EXHIBIT 11
CHEMICAL BANKING CORPORATION and Subsidiaries
Computation of net income per share
In the 1995 second quarter, the Corporation changed its reporting of earnings
per share ("EPS") from reporting simple EPS, (which is based solely on the
average number of common shares outstanding), to reporting primary and fully
diluted EPS (which are based on the average number of common and common
equivalent shares outstanding).
Previously, the Corporation reported simple EPS, since the differences between
simple EPS and primary EPS or simple EPS and fully diluted EPS were not material
(less than 3%). Primary and fully diluted EPS are now being reported for all
periods presented.
Net income for primary and fully diluted earnings per share are computed by
subtracting from the applicable earnings the dividend requirements on preferred
stock to arrive at earnings applicable to common stock and dividing this amount
by the weighted average number of common and common equivalent shares
outstanding during the period.
(in millions, except per share amounts): Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
1995 1994 1995 1994
---- ---- ---- ----
EARNINGS PER SHARE
Primary
Earnings:
Income Before Effect of Accounting Change $ 453 $ 357 $ 849 $ 676
Effect of Change in Accounting Principle --- --- (11)(a) ---
-------- ------- --------- --------
Net Income $ 453 $ 357 $ 838 $ 676
Less: Preferred Stock Dividend Requirements 26 33 56 65
-------- ------- --------- --------
Net Income Applicable to Common Stock $ 427 $ 324 $ 782 $ 611
======== ======= ========= ========
Shares:
Average Common and Common Equivalent
Shares Outstanding 248.3 255.1 246.8 255.2
======== ======= ======== ========
Primary Earnings Per Share:
Income Before Effect of Accounting Change $ 1.72 $ 1.27 $ 3.21 $ 2.39
Effect of Change in Accounting Principle --- --- (0.04)(a) ---
-------- ------- --------- --------
Net Income $ 1.72 $ 1.27 $ 3.17 $ 2.39
======== ======= ========= ========
Assuming Full Dilution
Earnings:
Net Income Applicable to Common Stock $ 427 $ 324 $ 782 $ 611
Add: Applicable Dividend on Convertible
Preferred Stock 2 5 7 10
-------- ------- --------- --------
Adjusted Net Income $ 429 $ 329 $ 789 $ 621
======== ======= ========= ========
Shares:
Average Common and Common Equivalent
Shares Outstanding 248.3 255.1 246.8 255.2
Additional Shares Issuable Upon Exercise of Stock
Options for maximum dilutive effect and Conversion
of Preferred Stock (b) 6.5 7.9 9.0 7.8
-------- ------- --------- --------
Adjusted Shares of Common and Equivalent Shares
Outstanding 254.8 263.0 255.8 263.0
======== ======= ========= ========
Earnings Per Share Assuming Full Dilution:
Income Before Effect of Accounting Change $ 1.68 $ 1.25 $ 3.12 $ 2.36
Effect of Change in Accounting Principle --- --- (0.04)(a) ---
-------- ------- --------- --------
Net Income $ 1.68 $ 1.25 $ 3.08 $ 2.36
======== ======= ========= ========
<FN>
(a) On January 1, 1995, the Corporation adopted SFAS 106 for accounting for
other postretirement benefits relating to the Corporation's foreign plans.
(b) During the second quarter of 1995, the Corporation called all of the
outstanding shares of its 10% convertible preferred stock for redemption.
Substantially all of the 10% convertible preferred stock was converted, at
the option of the holders thereof, to common stock. The common stock was
issued from treasury.
</FN>
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