Information about Bank Of America

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Bank of America Corporation
	Public (NYSE: BAC TYO: 8648 )
Founded	(as "Bank of Italy") San Francisco, CA (1928) (acquiring banks) Charlotte, NC (1874) Boston, MA (1784)
Headquarters	Charlotte, North Carolina, U.S.
Key people	Kenneth D. Lewis, Chairman, CEO & President Amy W. Brinkley, Global Risk Executive J. Steele Alphin, CAO Joe L. Price, CFO
Industry	Banking
Products	Financial Services
Revenue	$117.01 billion USD (2006)[]
Operating income	$21.64 billion USD (2006)[]
Net income	$21.13 billion USD (2006)[0][0]
Employees	203,425 (2006)[0]
Slogan	Bank of Opportunity[3]
Website	[https://www.bankofamerica.com/ www.bankofamerica.com]

Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world.^[4][5] It is the largest American company (by market capitalization) that is not part of the Dow Jones Industrial Average.

Corporate history

Before 1998, the Bank of America that exists today was known as NationsBank, based in Charlotte, North Carolina. In 1998, NationsBank acquired San Francisco-based BankAmerica and assumed the Bank of America name.

Pre-1998 history

Bank of Italy

The roots of the pre-1998 Bank of America lie in the American Bank of Italy, founded in San Francisco by Amadeo Giannini in 1904. When the 1906 San Francisco earthquake struck, Giannini was able to get all of the deposits out of the bank building and away from the fires. Thus, unlike many other banks, he retained the confidence of the depositors and also had money to lend to those struck by the disaster.

In the late 1920s, Giannini approached Orra E. Monnette, President and founder of Bank of America, Los Angeles, about a merger between the two entities. The Los Angeles based bank had exhibited strong growth throughout the 1920s, due in part to its success in developing an advanced branch banking system. The merger was completed in early 1929 and took the name Bank of America. The combined company was headed by Giannini with Monnette serving as co-Chair.

While the names of many nationally chartered banks end with the initials 'N.A.' (National Association), Giannini picked a unique ending, National Trust and Savings Association, or 'NT&SA', because he wanted the name to highlight the different functions of the bank. Bank of America was the only NT&SA in the country. Thanks to good management, but also to aggressive development of the branch banking concept, the bank was soon the largest in California.

Growth in California

Giannini also sought to build a national bank, expanding into most of the western states as well as into the insurance industry, under the aegis of his holding company, Transamerica Corporation. Bank of America NT&SA also had banking relationships in international financial markets. Largely out of fear that Giannini would succeed in his efforts to create a nationwide bank, federal legislation prohibited banks from accepting deposits in states where they were not headquartered. This led to the creation of the bank holding company which could own a separate bank in each state.

The passage of the Bank Holding Company Act of 1956, prohibited banks from owning non-banking subsidiaries such as insurance companies. Bank of America and Transamerica were separated, with the latter company continuing in the insurance business. However, federal banking regulators prohibited Bank of America's interstate banking activity, and Bank of America's domestic banks outside California were forced into a separate company that eventually became First Interstate Bancorp, which was acquired by Wells Fargo and Company in 1996. It was not until the 1980s with a change in federal banking legislation and regulation that Bank of America was again able to expand its domestic consumer banking activity outside California.

California was the nation's fastest growing state during the post-World War II boom, with the highest use of checking accounts (partially driven by many soldiers being paid via bank accounts during World War II), resulting in Bank of America being swamped by checks. By 1949 , the branches had to close at 2:00 p.m. in order to process the bookkeeping by 5:00 p.m. To cope with the transaction volume, the bank invested heavily in information technology and is generally credited, together with General Electric and SRI International, with inventing modern centralized bank operations, along with a number of financial transaction processing technologies such as automatic check processing, account numbers, and Magnetic Ink Character Recognition. Because of the efficiency of these technologies, the bank had significantly lower administrative costs than other banks and was able to expand until it became the world's largest bank in the early 1970s.

These technologies also enabled credit cards to be linked directly to individual bank accounts. In 1958, the bank invented the bank credit card, the BankAmericard, which changed its name to VISA in 1977. A consortium of other California banks came up with Master Charge (now MasterCard) in order to compete with BankAmericard.

Expansion outside of California

Following the passage of the Bank Holding Company Act of 1967, BankAmerica Corporation was established for the purpose of owning Bank of America and its subsidiaries.

BankAmerica expanded outside California in 1983 with its acquisition of Seafirst Corporation of Seattle, Washington, and its wholly owned banking subsidiary, Seattle-First National Bank. Seafirst was at risk of seizure by the federal government after becoming insolvent due to a series of bad loans to the oil industry. BankAmerica continued to operate its new subsidiary as Seafirst rather than Bank of America until the 1998 merger with NationsBank.

BankAmerica was dealt huge losses in 1986 and 1987 by the placement of a series of bad loans in the Third World, particularly in Latin America. The company fired its CEO, Sam Armacost. Though Armacost blamed the problems on his predecessor, A.W. (Tom) Clausen, Clausen was appointed to replace Armacost. The losses resulted in a huge decline of BankAmerica stock, making it vulnerable to a hostile takeover. First Interstate Bancorp of Los Angeles (which had originated from banks once owned by BankAmerica), launched such a bid in the fall of 1986, although BankAmerica rebuffed it, mostly by selling its FinanceAmerica subsidiary to Chrysler, and by selling the brokerage firm Charles Schwab and Co. back to Mr. Schwab. By the time of the 1987 stock market crash, BankAmerica's share price had fallen to $8, but by 1992 it had rebounded mightily to become one of the biggest gainers of that half-decade. The sale of its trophy corporate headquarters Bank of America Center building in San Francisco to raise capital was a symbolic blow to the bank.

BankAmerica's next big acquisition came in 1992. The company acquired its California rival, Security Pacific Corporation and its subsidiary Security Pacific National Bank in California and other banks in Arizona, Idaho, Oregon and Washington (which Security Pacific had acquired in a series of acquisitions in the late 1980s). This was, at the time, the largest bank acquisition in history. Federal regulators, however, forced the sale of Security Pacific's Washington subsidiary, Rainier Bank, as the combination of Seafirst and Rainier would have given BankAmerica too large a share of the market in that state. Later that year, BankAmerica expanded into Nevada by acquiring Valley Bank of Nevada.

In 1994 , BankAmerica acquired the Continental Illinois National Bank and Trust Co. of Chicago, which had become federally owned as part of the same oil industry debacle that had brought down Seafirst. At the time, no bank had the resources to bail out Continental, so the federal government operated the bank for nearly a decade. Illinois at that time regulated branch banking extremely heavily, so Bank of America Illinois was a single-unit bank until the 21st century. BankAmerica moved its national lending department to Chicago in an effort to establish a financial beachhead in the region.

These mergers helped BankAmerica Corporation to once again become the largest U.S. bank holding company in terms of deposits, but the company fell to second place in 1997 behind fast-growing NationsBank Corporation, and to third in 1998 behind North Carolina's First Union Corp. In 1998, BankAmerica was purchased by NC-based NationsBank, and changed the headquarters to Charlotte, North Carolina.

Merger of NationsBank and BankAmerica

In 1997, BankAmerica lent D.E. Shaw & Co., a large hedge fund, $1.4bn so that the hedge fund would run various businesses for the bank. However, D.E. Shaw suffered significant loss after 1998 Russia bond default. BankAmerica was later acquired by NationsBank that year.

The purchase of BankAmerica Corp. by the NationsBank Corporation was the largest bank acquisition in history at that time. While the deal was technically a purchase of BankAmerica Corporation by NationsBank, the deal was structured as merger with NationsBank renamed to Bank of America Corporation, and Bank of America NT&SA, changing its name to Bank of America, N.A. as the remaining legal bank entity. The bank still operates under Federal Charter 13044 which was granted to Giannini's Bank of Italy on March 1, 1927. However, SEC filings before 1998 are listed under NationsBank, not BankAmerica.

Following the US$64.8 billion acquisition of BankAmerica by NationsBank, the resulting Bank of America had combined assets of US$570 billion, as well as 4,800 branches in 22 states. Despite the mammoth size of the two companies, federal regulators insisted only upon the divestiture of 13 branches in New Mexico, in towns that would be left with only a single bank following the combination. This is because branch divestitures are only required if the combined company will have a larger than 25 percent FDIC deposit market share in a particular state or 10 percent deposit market share overall.

History since 1998

In 2001 , Bank of America CEO and chairman Hugh McColl stepped down and named Ken Lewis as his successor. Lewis's greater focus on financial discipline and efficiency contrasted greatly with the expansionary mergers and acquisition strategy of his predecessor.

Acquisition of National Processing Company

In 2004 , Bank of America purchased Louisville, Kentucky-based National Processing Company for $1.4 billion from National City Corp. The renamed company—BA Merchant Services—has been processing one in every five VISA and MasterCard transactions. The company also has been providing financial solutions for travel and healthcare companies. BA Merchant Services has been headquartered in Louisville.

FleetBoston Financial merger

Also in 2004, Bank of America acquired Boston, Massachusetts-based FleetBoston Financial for $47 billion in an all-stock deal to solidify Bank of America's position as the bank with the largest FDIC-rated deposit market share in the United States with $513 billion in deposits, well ahead of the number two bank holding company, newly-merged JPMorgan Chase-Bank One with $353 billion in deposits and number three Wells Fargo & Co. with $228 billion (as of 30 June 2003). This acquisition gave Bank of America access to the northeastern market.

Purchase of MBNA

On 30 June 2005, Bank of America announced it would purchase credit card giant MBNA for $35 billion in cash and stock. The Federal Reserve Board gave final approval to the merger on 15 December 2005, and the merger closed on 1 January 2006. The acquisition of MBNA provided Bank of America a leading credit card issuer at home and abroad. The combined Bank of America Card Services organization, including the former MBNA—had more than 40 million U.S. accounts and nearly $140 billion in outstanding balances.

Divestiture of operations in Brazil, Chile and Uruguay

In May 2006, the Bank of America and Banco Itau (Investimentos Ita S.A.) entered into an acquisition agreement through which Itaú agreed to acquire BankBoston's operations in Brazil and was granted an exclusive right to purchase Bank of America's operations in Chile and Uruguay. A deal was signed in August 2006 under which Itaú agreed to purchase Bank of America's operations in Chile and Uruguay. Prior to the transaction, BankBoston's Brazilian operations included asset management, private banking, a credit card portfolio, and small, middle-market, and large corporate segments. It had 66 branches and 203,000 clients in Brazil. BankBoston in Chile had 44 branches and 58,000 clients and in Uruguay it had 15 branches. In addition, there was a credit card company, OCA, in Uruguay, which had 23 branches. BankBoston N.A. in Uruguay, together with OCA, jointly served 372,000 clients. While the BankBoston name and trademarks were not part of the transaction, as part of the sale agreement, they cannot be used by Bank of America in Brazil, Chile or Uruguay following the transactions. Hence, the BankBoston name has disappeared from Brazil, Chile and Uruguay. The Itaú stock received by Bank of America in the transactions has allowed Bank of America's stake in Itaú to reach 11.51%. Banco Boston do Brazil had been founded in 1947.

Purchase of US Trust

On 20 November 2006, Bank of America announced the purchase of The United States Trust Company for $3.3 billion, from the Charles Schwab Corporation. US Trust had about $100 billion of AUM and over 150 years of experience. The deal closed 1 July 2007.^[6]

Acquisition of ABN Amro North America and LaSalle Bank

On Sept 14 2007, Bank of America won approval from the Federal Reserve to acquire ABN Amro North America and LaSalle Bank Corporation from ABN AMRO for $21 billion. With this combination Bank of America will have 1.7 trillion in assets. A Dutch court blocked the sale until it was later approved in July. The acquisition was completed on October 1, 2007.

The deal increased Bank of America's presence in Illinois, Michigan, and Indiana by 411 branches, 17,000 commercial bank clients, 1.4 million retail customers and 1,500 ATMs. Bank of America has become the largest bank in the Chicago market with 197 offices and 14% of the deposit share, passing up JPMorgan Chase. LaSalle customers now have fee free access to Bank of America ATMs from coast to coast as well as access to the Global ATM Alliance.

Investment in Countrywide Financial Corporation

On August 23, 2007 the company announced a $2 billion dollar repurchase agreement for Countrywide Financial Corporation. This purchase of preferred stock is arranged to provide a return on investment of 7.25% per annum and can be converted into common stock at a price of $18 per share.^[7]

Bank of America divisions

Bank of America generates 90% of its revenues in its domestic market and continues to buy businesses in the US. The core of Bank of America’s strategy is to be the number one bank in its domestic market. It has achieved this through key acquisitions. ^[8] As a result of its mergers and acquisitions, Bank of America is now the largest issuer of credit, debit and prepaid cards in the world based on total purchase volume, as well as the largest consumer and small business bank in the United States.

Consumer

Global Consumer and Small Business Banking is the largest division in the company, and deals primarily with consumer banking and credit card issuance. The acquisition of FleetBoston and MBNA significantly expanded its size and range of services, resulting in about 51% of the company's total revenue in 2005. It competes directly with the retail banking divisions of Citigroup and JPMorgan Chase. The GC&SBB organization includes over 5,700 retail branches and over 17,000 ATMs across the United States.

Bank of America is a member of the Global ATM Alliance, a joint venture of several major international banks that allows customers of the banks to use their ATM card or check card at another bank within the Global ATM Alliance with no fees when traveling internationally. Other participating banks are Barclays (United Kingdom), BNP Paribas (France), China Construction Bank (China), Deutsche Bank (Germany), Santander Serfin (Mexico), Scotiabank (Canada) and Westpac (Australia and New Zealand).^[9]

Corporate

Global Corporate and Investment Banking (GCIB), also known as Banc of America Securities LLC, provides mergers and acquisitions advisory, underwriting, capital markets, as well as sales & trading in fixed income and equities markets. Its strongest groups include Leveraged Finance, Syndicated Loans, and mortgage-backed securities. It also has one of the largest research teams on Wall Street. Banc of America Securities LLC is based in New York City, with major offices also located in Charlotte, Chicago, San Francisco, Tokyo, Frankfurt, London, and Mumbai.

Investment Management

Global Wealth and Investment Management manages assets of institutions and individuals. It is among the 10 largest U.S. wealth managers (ranked by private banking assets under management in accounts of $1 million or more as of June 30, 2005). In July 2006, Chairman Ken Lewis announced that GWIM's total assets under management exceeded $500,000,000,000. GWIM has five primary lines of business: Premier Banking & Investments (including Banc of America Investment Services, Inc.), The Private Bank, Family Wealth Advisors, Columbia Management Group, and Banc of America Specialist.

Bank of America has recently spent $675 million building its US investment banking business and are looking to become one of the top five investment banks worldwide. "Bank of America already has excellent relationships with the corporate and financial institutions world. Its clients include 98% of the Fortune 500 companies in the US and 79% of the Global Fortune 500. These relationships, as well as a balance sheet that most banks would kill for, are the foundations for a lofty ambition."^[10]

Bank of America is currently constructing a massive new headquarters for its New York City operations. The skyscaper will be located on 42nd Street and Avenue of the Americas, at Bryant Park, and will feature state of the art, environmentally-friendly technology throughout its 1.2 million square feet (111,484 m²) of office space. The building will be the headquarters for the company's investment banking division, and will also host most of Bank of America's New York-based staff.

International operations

In 2005, Bank of America acquired a 9% stake in China Construction Bank, China's second largest bank, for $3 billion.^[11] It represented the company's largest foray into China's growing banking sector. Bank of America currently has offices in Hong Kong, Shanghai, and Guangzhou and is looking to greatly expand its Chinese business as a result of this deal.

Bank of America has invested in India as an emerging market. Currently, Bank of America maintains branches in Mumbai, Chennai, Calcutta, New Delhi and Bangalore. For the fiscal year ending March 31, 2006 Bank of America reported an 80% increase in net profit.^[12] .

Bank of America operated under the name BankBoston in many other Latin American countries, including Brazil. In 2006, Bank of America sold all BankBoston's operations to Brazilian bank Banco Itaú, in exchange for Itaú shares. The BankBoston name and trademarks were not part of the transaction and, as part of the sale agreement, cannot be used by Bank of America. That, in practical terms, deemed the definite extinction of the BankBoston brand.

Bank of America's Global Corporate and Investment Banking spans the Globe with divisions in United States, Europe and Asia. The U.S. headquarters are located in New York, European headquarters are based in London and Asia's headquarters are split between Singapore & Hong Kong.

Financial Data

Financial data in $ millions

Year	2002	2003	2004	2005	2006
revenue net of interest	35 082	38 529	49 610	56 923	74 247
EBITDA	18 654	16 722	21 885	29 490	35 597
Net Results	9 249	10 810	14 143	16 465	21 133
Staff	NA	NA	176 000	176 638	203 000

:::::''Source :'OpesC'

Corporate Governance

Directors

• William Barnet III, Chairman, President and Chief Executive Officer, The Barnet Company
• Frank P. Bramble Sr, Former, Executive Officer, MBNA Corporation
• John T. Collins, Chief Executive Officer, The Collins Group
• Gary L. Countryman, Chairman Emeritus, Liberty Mutual Group
• Tommy Franks, Retired General, United States Army
• Charles K. Gifford, Former Chairman, Bank of America Corporation
• W. Steven Jones, Dean, Kenan-Flagler Business School University of North Carolina at Chapel Hill
• Kenneth D. Lewis, Chairman, Chief Executive Officer and President, Bank of America Corporation
• Monica C Lozano, Publisher and Chief Executive Officer of La Opinion
• Walter E. Massey, President Emeritus, Morehouse College
• Thomas J. May, Chairman, President and Chief Executive Officer, NSTAR
• Patricia E. Mitchell, President and Chief Executive Officer, The Paley Center for Media
• Thomas M. Ryan, President and Chief Executive Officer of CVS/Caremark Corporation
• O. Temple Sloan, Jr., Chairman, General Parts International
• Meredith R. Spangler, Trustee and Board Member
• Robert L. Tillman, Chairman and CEO Emeritus, Lowe's
• Jackie M. Ward, Retired Chairman/CEO, Computer Generation

Social responsibility

In the mid 2000s, Bank of America began accentuating its charitable side. In addition to its new eco-friendly office tower in Manhattan, Bank of America has pledged to spend billions on commercial lending and investment banking for projects that it considers "green." The corporation, which already supplied all of its employees with cash incentives to buy hybrid vehicles, is also helping its customers be eco-friendly by rolling out a new credit card program in 2007 that would donate money to helping the environment, as well as providing mortgage loan breaks for customers whose homes qualified as energy efficient.^[13]

In addition to trying to help the environment, Bank of America has also donated money to help health centers in Massachusetts^[14] and made donations to help homeless shelters in Miami.^[15]

Diversity

Bank of America was named one of the 100 Best Companies for Working Mothers in 2004 by Working Mothers magazine. Furthermore, Amy Woods Brinkley, the Bank's Global Risk Executive, and Barbara Desoer, the Bank's Global Technology and Service Fulfillment Executive, were named two of the most powerful women in Banking by US Banker magazine, and were among the "top 50 most powerful women in business," as ranked by Fortune.

Controversies

Main article: Bank of America controversies

Bank of America has been involved in a number of controversial issues. Many of its policies, such as "biggest check first" check clearing, overdraft fee policies, credit cards to illegal immigrants, and early account closures, have become heavily criticized. Bank of America controversies details some of the more notable and public issues.

Bank of America corporate buildings

• Bank of America Fifth Avenue Plaza in Seattle, WA
• Bank of America Building in Bellevue, WA
• Bank of America Tower in St Petersburg, FL
• Bank of America Tower in Providence, RI
• Bank of America Tower in New York City, NY (under construction)
• Bank of America Tower in Jacksonville, FL
• Bank of America Tower in Albuquerque, NM
• Bank of America Tower in Hong Kong
• Bank of America Tower in Tampa, FL
• Bank of America Plaza in St Louis, MO
• Bank of America Tower in Richmond, VA
• Bank of America Tower in Miami, FL
• Bank of America Tower in Lubbock, TX
• Bank of America Tower in Los Angeles, CA
• Bank of America Tower in Boca Raton, FL
• Bank of America Center in Houston, TX
• Bank of America Center in San Francisco, CA
• Bank of America Banking Center in Washington, DC (across from the White House)
• Bank of America Plaza in Atlanta, GA (the tallest U.S. building outside of NYC and Chicago)
• Bank of America Plaza in Charlotte, NC (adjacent to the Bank of America Corporate Center)
• Bank of America Plaza in Dallas, TX
• Bank of America Building in Chicago, IL
• Bank of America Building in Galveston, TX ^[16]

Major Sponsorships

Bank of America owns the naming rights of several venues and events in the sports world

• Bank of America Stadium, Charlotte, NC—Carolina Panthers, NFL.
• Bank of America Arena, Seattle, WA—University of Washington men's and women's basketball
• Bank of America 500, a NASCAR race that is hosted annually at Lowe's Motor Speedway, Concord, NC
• Bank of America Chicago Marathon

Official Bank of:

• United States Olympic Teams
• NFL (the National Football League)
• NHL (the National Hockey League)
• NASCAR (National Association for Stock Car Auto Racing)
• Major League Baseball
• Minor League Baseball
• Little League Baseball

Ad campaigns that run during the Little League World Series and the World Series use the slogan "The Official Bank of Baseball."

Regional Sponsorships:

Arts and Culture

• Latino Institute, Phoenix, AZ
• Lincoln Park ZooLights, Chicago, IL
• Seven Wonders of Chicago, Chicago, IL
• University of Arizona, Tucson, AZ

Baseball

• Baltimore Orioles, a MLB team
• Boston Red Sox, a MLB team
• Chicago Cubs, a MLB team
• Los Angeles Angels of Anaheim, a MLB team
• Los Angeles Dodgers, a MLB team
• New York Yankees, a MLB team
• Oakland A's, a MLB team
• San Diego Padres, a MLB team
• San Francisco Giants, a MLB team
• St. Louis Cardinals, a MLB team
• Cape Cod Baseball League
• Rutgers University

Basketball

• Phoenix Suns, an National Basketball Association League team
• University of Maryland

Football

• Carolina Panthers, an NFL team.
• Dallas Cowboys, an NFL team
• New England Patriots, an NFL team
• Washington Redskins, an NFL team
• ARMY/NAVY game
• Bank of America Atlanta Football Classic
• Orange Bowl Classic
• Rutgers University
• New England Revolution, a MLS team.

NASCAR, International Speedway Corp. (ISC) and Speedway Motorsports, Inc. (SMI)

• Atlanta Motor Speedway, GA
• California Speedway, CA
• Chicagoland Speedway, IL
• Infineon Raceway, CA
• Kansas Speedway, KS
• Las Vegas Motor Speedway, NV
• Lowe's Motor Speedway, NC
• Phoenix International Raceway, AZ
• Texas Motor Speedway, TX
• Watkins Glen International, NY

Golf

• Bank of America Championship (PGA Champions Tour)
• Bank of America Colonial (PGA Tour)
• Bank of America Gasparilla Distance Classic
• Booz Allen Classic (PGA Tour)
• Buick Invitational (PGA Tour)
• Hispanic Heritage Classic
• Iroquois Steeplechase presented by Bank of America
• Michelin Championship at Las Vegas (PGA Tour)

References

See also

• Bank of America Canada
• Bank of America (Asia)
• List of bank mergers in United States

External links

• [https://www.bankofamerica.com BankOfAmerica.com] PC / Mac homepage
• BofA.mobi Mobile Banking
• Yahoo!—Bank of America Corporation Company Profile
• For more information about bank market share, see the FDIC's web site, which includes historical data

•  • [ e] 50 largest American banks and bank holding companies

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