Did you know that Bank of America was formerly known as the Bank of Italy?
The success and reputation of Bank of America can actually be attributed to one man.
Amadeo Pietro Giannini.
Giannini was a member of the bank Columbus Savings & Loan Society.
He attempted to persuade the directors to lend out loans to the average everyday common worker.
No way would we lend out loans except to the rich or those owning businesses.
Not to be dissuaded, Giannini raised $150,000 from various friends and family to start the Bank of Italy which would specialize in loaning money out to the common worker.
With nothing more than a judge of character and a handshake, Giannini made it a practice to loan out money to the working class.
Within a single year, the Bank of Italy had accrued over $700,000 (around $15-$20 million in today’s money) in deposits and had become the third largest bank in the United States!
It didn’t stop there:
Two years after the founding of the Bank of Italy, the great San Francisco earthquake of 1906 occurred destroying 80 percent of the city.
Between 200,000 and 300,000 of the city’s 410,000 population were left homeless due to the devastation caused.
Giannini immediately went to work:
He dug through the rubble of his former bank, gathering $2 million into a wagon (which he covered to protect) and drove the wagon into town.
It gets better:
There he set up a temporary bank with nothing more than two barrels and a piece of wood as his desk!
True to his character, Giannini began taking deposits and giving loans out to help out those that had lost everything so that they could start the long hard process of rebuilding.
Since many people had even lost their identification papers, Giannini even went as far as to hand out loans with nothing more than a signature followed by a handshake as promise of repayment!
Here are some more truly inspiring facts on Bank of America’s original founder and bank:
Giannini famously said:
“Be first in everything.”
He was once riding on horseback to secure a contract with one of the valley’s biggest growers when he spotted one of his competitors heading in the same direction.
He immediately headed towards a short cut that required him to jump off his horse and swim across a swamp to get there first.
By the time his competitor had arrived, Giannini was already negotiating the deal with the grower!
The founders of HP, William Hewlett and David Packard, borrowed a loan from Giannini to start their business.
We all know how many billions and billions of dollars HP’s empire is worth today and it all started with that initial loan from Giannini’s Bank.
A visionary engineer named Joseph Strauss proposed plans for building a suspension bridge that would overcome the nightmarish commute across the San Francisco Bay.
However, in order to make his plans a reality, he had to find someone to purchase the necessary bonds.
Giannini did so stating:
“California needs that bridge. We’ll buy the bonds.”
Although Giannini did well and was able to retire by 31:
He popped back out of retirement when he was asked by a group of San Francisco businessman to serve interests of the Italian-American community.
I’m back, everyone!
Even though Giannini could have made a vast amount of fortune for himself throughout his career, he did not believe in accumulating great personal wealth.
His entire estate was valued at only $500,000 when he died at the age of 79 in 1949.
Throughout his career, Giannini refused pay for his work.
Even when the board attempted to give him $1.5 million as a bonus one year, he gave it all away to the University of California stating:
“Money itch is a bad thing.
I never had that trouble.”
Giannini’s biological father is said to have died in a fight over a single dollar when Giannini was just seven years old.
I mean come on I’ve heard of making every penny count, but I’ve also heard of not crying over spilled milk.
I hope his death was justified, though.
Giannini was asked by Congress what his thoughts about nationwide banking were.
“It is coming, gentlemen, and there is nothing you can do to stop it.”
His dream was realized many years after his death when Bank of America merged with NationsBank.
Nationwide banks could afford to lend money to troubled areas and people in those areas wouldn’t have to worry about losing their money.
Giannini often said:
“I don’t want to be rich.
No man owns a fortune; it owns him.”
Most of his money was used to start foundations, fund scholarships, and encourage medical and agricultural research.
A. P. Giannini once said:
“It’s no use to decide what’s going to happen unless you have the courage of your convictions.
Many a brilliant idea has been lost because the man who dreamed it lacked the spunk or the spine to put it across.
It doesn’t matter if you don’t always hit the exact bulls-eye, the other rings in the targets score points, too.”
What a fire of a spirit!
Bank of America was the first bank in America to offer a universally accepted credit card.
The credit card was originally called the “BankAmericard”before being re-branded as “VISA.”
I think we can all agree that VISA sounds a lot better than BankAmericard.
Giannini had a very sensitive heart towards the working class, who typically worked very long hours.
In order to cater to their schedules, Giannini made sure that his bank stayed open until 10 pm every night whereas traditional banks would close around 3 pm at the time.
By 2010, Bank of America had become the third largest non-oil company in the United States after Walmart and General Electric.
That’s quite a staggering figure to consider when you realize how large oil companies and Walmart are for Bank of America to be following right behind.
Bank of America is massive.
So massive, in fact:
That they operate around 5,100 banking centers, 16,300 ATMs, call centers, online and a mobile banking platform.
And here you thought your local college campus or neighborhood was huge.
The largest wealth management corporation title goes to Bank of America after it acquired Merrill Lynch.
This bank also holds a significant role in the investment banking market.
We’re not saying put all your wealth into Bank of America nor to dig a hole in the backyard.
Bank of America’s assets keep getting larger and larger.
In August of 2009, 12.2 percent of all bank deposits were held by Bank of America.
In 2014, Bank of America’s assets under management were enhanced 12.5 percent.
Bank of America is undoubtedly one of the largest and most competitive banks in the nation.
Its main competitors include:
Wells Fargo, Citigroup, and JPMorgan Chase.
We personally use JPMorgan Chase and haven’t had any problems with them so far.
How’s this for building a customer base?
Bank of America has approximately 50 million consumers and small business relationships.
Honestly, that’s a very large list of contacts for multiple companies to possess let alone a single company.
The financial crises in America was tough for a lot of people and even large corporations such as Bank of America had their share of troubles to deal with.
Legal problems that involved mortgages and financial disclosures it presented to its clients.
Bank of America’s largest division is the consumer banking division.
Over half of the company’s overall net income comes from this side of its business.
Think back for a minute:
Remember the story of Giannini and realize how much different the banks of today operate as compared to prior Giannini’s time.
Joining Bank of America’s Global ATM Alliance has a great perk for its members.
It means that you do not need to pay any access fees when you check the card at another bank in the network of Global ATM Alliance.
How’s that for customer convenience?
The network of Global ATM Alliance includes Westpac (Australia and New Zealand), BNP
Paribas (France), Scotiabank (Canada), UkrSibbank (Ukraine), Barclays (United Kingdom),
Deutsche Bank (Germany), China Construction Bank (China) and Santander Serfin (Mexico).
Bank of America has clients in over 150 different countries.
If that’s not enough then how about this:
Bank of America has a relationship with 99 percent of US Fortune 500 and 96 percent of Global Fortune 500 companies?
Few companies can claim to possess such a large customer base.
In 2010, Forbes ranked Bank of America as being the third largest corporation in the world.
I’m sure management at the company made big enough profits to live comfortably.
Hmm… that reminds us of another “big” company you may have heard of.
The company allegedly rejects the right of its customers to protest.
When one woman entered the bank and began protesting and demanding that her account be closed the response was:
“You cannot be a protester and a customer at the same time.”
Bank of America was the first large bank to charge customers a $5 debit usage fee for customers with less than a $5,000 balance and no mortgage with the bank.
This prompted the Consumers Union to write a letter to the Bank’s chief Brian Moynihan in opposition.
Senator Dick Durbin’s (D-Illinois) urged customers:
“Vote with your feet.
Get the heck out of that bank.”
Many consumers feel as if they are being overburdened or taken advantage of when it comes to Bank of America’s fees.
According to a former annual report:
The bank has 29.3 million active online subscribers who paid over $300 billion worth of bills in 2010.
A charge was brought against Bank of America for colluding with the two major credit card companies, Visa and Mastercard, to keep ATM fees high.
This is known as “price-fixing” and is in direct opposition to antitrust laws!
The sun is definitely setting on the company’s former glory.
Bank of America had an insanely large settlement agreement of $8.5 billion to settle claims related to $100 billion worth of countrywide-spun mortgage securities backed by faulty loans.
When the big bad wolf comes knocking, it helps if your home is built from bricks.
Bank of America was sued by state and federal regulators for shady foreclosure practices and a union benefits plan for hiding foreclosure problems that impacted its share price.
The facts can only be the facts.
How long before the truth becomes unbearable?
Since Bank of America acquired Merrill Lynch’s AIG (American International Group) related portfolio, Bank of America got to keep approximately $12 billion worth of federal AIG backing, too.
I don’t know.
Maybe it’s just us, but do you get a sense of corruption in the air?
In 2010, Bank of America was forced to pay $137.7 million after they were accused by the federal government of defrauding organizations with illegal investment practices.
Needless to say:
Giannini would not be pleased with the way things are operating today.
What are your thoughts on all of this?
Do you have any stories you’d like to share?