The Bank of America Corporation (Bank of America; often abbreviated BAC, BofA, or, less commonly, BOA) is an American multinational bank and financial services holding company headquartered at the Bank of America Corporate Center in Charlotte, North Carolina, with investment banking and auxiliary headquarters in Manhattan. The bank was formed by the merger of NationsBank and the legacy corporation of Bank of America in 1998. It is the second-largest banking institution in the United States by consolidated assets, after JPMorgan Chase. It is also the second-largest bank in the world by market capitalization, after JPMorgan Chase.
Among the Big Four banking institution and one of eight systemically important financial institutions in the United States; it competes with JPMorgan Chase, Citigroup, and Wells Fargo. Its primary financial services revolve around commercial banking, wealth management, and investment banking.
Through past mergers, the oldest branch of the Bank of America franchise dates back to 1784, when Massachusetts Bank was chartered, becoming the first federally chartered joint-stock-owned bank in the United States. Another branch of its history goes back to the American-based Bank of Italy, founded by Amadeo Pietro Giannini in 1904, which provided various banking services to Italian immigrants who faced service discrimination at the time. The bank grew due to insurance monies provided after the 1906 Earthquake. Headquartered in San Francisco, California, Giannini acquired Banca d'America e d'Italia in 1922 and eventually did business as Bank of America.
In the 1950s, the passage of landmark federal banking legislation facilitated rapid growth, quickly establishing prominent shares for the present bank's predecessors. After suffering significant losses during the 1998 Russian financial crisis, BankAmerica, as it was then known, was acquired by the Charlotte-based NationsBank for $62 billion. Following what was then the largest bank acquisition in history, the Bank of America Corporation was founded. Through a series of mergers and acquisitions, it built upon its commercial banking business by establishing Merrill Lynch for wealth management and Bank of America Merrill Lynch for investment banking in 2008 and 2009, respectively, and since renamed BofA Securities.
As of 2018, the investment bank was considered within the "bulge bracket" as the world's third-largest investment bank. Its wealth management unit then managing $1.08 trillion in assets under management (AUM) as the second-largest wealth manager in the world, after UBS. In commercial banking, Bank of America has operations, but does not maintain retail branches in all 50 states of the United States, Washington, D.C., and over 40 other countries.B of A has operations (for example, Merrill Lynch offices), but no retail branches in Alabama, Alaska, Hawaii, Louisiana, Mississippi, Montana, Nebraska, North Dakota, South Dakota, Vermont, West Virginia, Wisconsin, or Wyoming. Bank of America Branches and ATMs; . Click "Browse locations by state." 2014 Bank of America Corporation. Retrieved June 30, 2014.
The bank's large market share, business activities, and economic impact have led to numerous lawsuits and investigations regarding both mortgages and financial disclosures dating back to the 2008 financial crisis. Its corporate practices of servicing the middle class and wider banking community have yielded a substantial market share since the early 20th century. , Bank of America has a $313.5 billion market capitalization, making it the 13th largest company in the world.
History Bank of America, Los Angeles, was founded in California in 1923. In 1928, this entity was acquired by the Bank of Italy of San Francisco, which took the Bank of America name two years later.
The eastern portion of the Bank of America franchise can be traced to 1784, when the Massachusetts Bank was chartered, the first federally chartered joint-stock owned bank in the United States and only the second bank to receive a charter in their country. This bank became FleetBoston, with which Bank of America merged in 2004. In 1874, Commercial National Bank was founded in Charlotte. That bank merged with American Trust Company in 1958 to form American Commercial Bank. Two years later, it became North Carolina National Bank when it merged with Security National Bank of Greensboro. In 1991, it merged with C&S/Sovran Corporation of Atlanta and Norfolk to form NationsBank.
The central portion of the franchise dates to 1910, when Commercial National Bank and Continental National Bank of Chicago merged to form Continental & Commercial National Bank, which evolved into Continental Illinois National Bank & Trust.
Early history
The history of Bank of America dates to October 17, 1904, when Amadeo Giannini founded the Bank of Italy in San Francisco. In 1922, the Bank of America, Los Angeles, was established with Giannini as a minority investor. The two banks merged in 1928 and, through further consolidations to become the largest banking institution in the country.
In 1928, Bank of Italy merged with Bank of America, Los Angeles. The following year, New York City investment bank, Blair & Co., merged with Bank of America. The Bank of Italy was renamed on November 3, 1930, to Bank of America National Trust and Savings Association, with Giannini and Monnette as co-chairs. By 1929, the bank had 453 banking offices in California with aggregate resources of over US$1.4 billion."Statewide Expansion" pp. 34–38 In: Branch Banking California. Report for the U.S. Federal Reserve System. web version at: PDF version Giannini sought to build a national bank, expanding into most of the western states, as well as into the insurance industry, under his holding company, Transamerica Corporation.
In 1953, regulators succeeded in forcing the separation of Transamerica Corporation and Bank of America under the Clayton Antitrust Act.Transamerica Corporation, a corporation of Delaware , has petitioned this court to review an order of the Board of Governors of the Federal Reserve System entered against it under Section 11 of the Clayton Act, 15 U.S.C.A. § 21, to enforce compliance with Section 7 of the Act, 15 U.S.C.A. § 18.
New technologies enabled the direct linking of credit cards with individual bank accounts, so that, in 1958, the bank introduced its BankAmericard, later renamed Visa, in 1977.
From February 1970 through September 1971, there were 66 attacks on Bank of America branches in California, including 53 bombings or fire-bombings, and 13 arson fires. There were "few injuries" and the property damage cost about $500,000, 80% of which was from the burning of the Isla Vista branch during a February 1970 riot.
Expansion outside California
Following the passage of the Bank Holding Company Act of 1956 by the U.S. Congress, BankAmerica Corporation was established for the purpose of owning and operating Bank of America and its subsidiaries.
In 1983, Bank of America expanded outside California, through acquisition of Seafirst Corporation in Seattle and its wholly owned banking subsidiary, Seattle-First National Bank.
BankAmerica experienced huge losses in 1986 and 1987 due to the placement of a series of bad loans in the Third World. In 1992, the company acquired 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 represented, at the time, the largest bank acquisition in history.
The series of 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 North Carolina's fast-growing NationsBank Corporation, and to third in 1998 behind First Union Corp.
On the capital markets side, the acquisition of Continental Illinois helped BankAmerica to build a leveraged finance origination- and distribution business, which allowed the firm's existing broker-dealer, BancAmerica Securities (originally named BA Securities), to become a full-service franchise.. American Banker, June 17, 1996. In addition, in 1997, BankAmerica acquired Robertson Stephens, a San Francisco–based investment bank specializing in high technology for $540 million. Robertson Stephens was integrated into BancAmerica Securities, and the combined subsidiary was renamed "BancAmerica Robertson Stephens"."BankAmerica to Buy Robertson, Stephens Investment Company" (.) The New York Times, June 9, 1997.
Merger of NationsBank and BankAmerica, 1998
In 1997, BankAmerica lent investment management firm D. E. Shaw & Co. $1.4 billion to run various businesses for the bank. However, D.E. Shaw suffered significant losses during the 1998 Russian financial crisis. NationsBank of Charlotte acquired BankAmerica in 1998 in what was the largest bank acquisition in history at that time.
While NationsBank was the nominal survivor, the merged bank took the better-known name of Bank of America. Hence, the holding company was renamed Bank of America Corporation, while NationsBank, N.A., merged with Bank of America NT&SA to form Bank of America, N.A. as the remaining legal bank entity. The combined bank operates under Federal Charter 13044, which was granted to Giannini's Bank of Italy on March 1, 1927. However, the merged company was and still is headquartered in Charlotte, and retains NationsBank's pre-1998 stock price history. All U.S. Securities and Exchange Commission (SEC) filings before 1998 are listed under NationsBank, not Bank of America. NationsBank president, chairman, and CEO Hugh McColl took on the same roles with the merged company.
In 1998, Bank of America possessed combined assets of $570 billion, as well as 4,800 branches in 22 U.S. states. Despite the 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. These branches were sold to BOK Financial Corporation, which operates them under the name "Bank of Albuquerque". The broker-dealer, NationsBanc Montgomery Securities, was named Banc of America Securities in 1998.
Banc of America Securities subsidiary
Banc of America Securities LLC (BAS) was the investment banking subsidiary of BoA from 1998 until BoA was merged with Merrill Lynch (2008). Headquartered in New York City, the company competed in both the domestic and international equity and investment banking markets. The company was a registered broker-dealer with the United States Securities and Exchange Commission (SEC) and was a member of the New York Stock Exchange and the National Association of Securities Dealers. The use of "Banc" in the BAS's name was indicative of the fact that the company was not a bank, and its deposits and other holdings were not insured by the Federal Deposit Insurance Corporation.