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finance-banking Monday, July 23, 2007finance-banking
financeThe Best European PerformersThere are no flavor-of-the-month outfits or dot-com hangers-on in the European BusinessWeek 50. Only companies whose managers know how to earn money in good times and bad make the grade.Name an economic malady and Europe has it in abundance right now: sluggish economic growth, lackluster consumer spending, currency swings that hurt exports, and depressed stock markets. For that reason, BusinessWeek could not have picked a better time to launch its first annual ranking of Europe's 50 best-performing companies. You won't find any frothy flavor-of-the-month outfits or dot-com hangers-on among these stalwarts. The BW Europe 50 is instead studded with companies whose managers know how to make money in good times and bad. What do corporations such as British bank HBOS (No. 1), Belgian utility Electrabel (No. 4), and Swedish apparel retailer H&M Hennes & Mauritz (No. 8) have in common? All have made singular progress in boosting sales, increasing profits, and delivering superior returns to investors in these worst of times for much of Europe. "Such top performers excel mainly because of good management that knows what to do in a difficult environment," says Robert Parkes, a European analyst at HSBC Bank in London. "They're doing well because they've kept in touch with what their customers and shareholders want."Most of the companies that powered to the top of this inaugural list are top-notch names with the size, stamina, and savvy needed to thrive in turbulent times. Energy companies like Total and financial-services companies such as Royal Bank of Scotland Group figure prominently. So do retail and consumer-staple giants such as France's Carrefour and Switzerland's Nestlé. Notable by their absence are Europe's big technology and telecom companies. Only three made it onto our top 50 list: France's Bouygues, Italy's Telecom Italia Mobile, and Finland's Nokia. Absent from the top 50 are powerhouses such as Germany's SAP, Geneva-based STMicroelectronics, and France's Alcatel. Blame the poor tech showing on three years of weak revenue growth, poor profitability, and, most of all, sagging stock market valuations.As investors know all too well, companies can manage impressive profits one year, only to disappoint the next. That's why the BW Europe 50 rewards those with staying power. To generate our ranking we used a series of criteria that judge the performance of the companies in the Standard & Poor's Europe 350 stock index over both one and three years.The turmoil in the markets over the past year means that today's darling can become tomorrow's dog almost overnight. That's why it's important not to see the BW Europe ranking as an all-knowing investment guide. Even stellar performers have their ups and downs from year to year. Take German pharmaceutical firm Altana and Spanish construction and engineering company Grupo Dragados. They beat all comers with total returns of 160.2% and 140.6%, respectively, between June 30, 2000, and June 30, 2003. However, both companies have delivered lower returns in recent months and neither Altana nor Grupo Dragados would appear in the top 50 if the ranking was based simply on the returns generated over the past 12 months.There's a definite British tilt in the European BW 50: British enterprises dominate, accounting for 17 of the 50 and 6 of the top 10. In part, that's because Britain has the most publicly traded companies of any European nation. That automatically increases the odds for British companies. Other elements are at work, though: The British economy has outperformed the 12-member euro zone in each of the past three years, and British companies have benefited from more buoyant domestic demand. France and Spain are also well represented. By contrast, although the German economy is the biggest in Europe by far, there isn't a single German company among the top 20. "Many German companies, such as car manufacturers, are well managed," says Paul Strebel, a professor at the IMD-International Institute for Management Development in Lausanne, Switzerland. "But the environment is more difficult there in terms of the macro background and structural rigidities."What's the secret of Anglo-Saxon corporate prowess? British companies operate in a freer environment than many of their Continental competitors. They do not suffer from the same labor restrictions, heavy social-security burden, and other structural impediments that hold back enterprises in many countries. It would have been much more difficult for HBOS, Royal Bank of Scotland Group, and HSBC Holdings to cut costs and exploit synergies as aggressively as they have done over the past three years if they had been headquartered in Germany rather than Britain. Yet structural reforms now wending their way through the German parliament may give Teutonic companies a competitive jolt. Also, notable absentees from this year's list, such as Deutsche Bank, could well make it next year, thanks to their belated cost-cutting efforts.The European BW 50 also provides proof that, despite the long-standing argument over whether mergers generate shareholder value, they can and do create powerful, successful companies. HBOS and Royal Bank of Scotland, the two top-performing banks on the list, both British, prove the point. HBOS, which heads the overall ranking, was created in 2001 when Bank of Scotland joined forces with Halifax PLC, a mortgage specialist. A year earlier, Royal Bank of Scotland, No.3 on our list, acquired National Westminster Bank PLC. The merged entities now not only outrank British arch-rivals HSBC (No. 48) and Barclays PLC (No. 52), but also every bank on the Continent. "We have the financial strength and flexibility needed to sustain growth and manage risk in an uncertain world," says HBOS Chief Executive James Crosby. "Our merger continues to exceed expectations."Meanwhile, ongoing consolidation within the global pharmaceutical industry has produced some of Europe's biggest mergers. The 1999 union of Sweden's Astra and Britain's Zeneca gave birth to Europe's third-largest drug company -- and No.35 on our list. A year later, rival British drugmakers GlaxoWellcome and Smith-Kline Beecham joined forces, to form the global No. 2, behind Pfizer of the U.S.With a market value of 105 billion euros, GlaxoSmithKline PLC also ranks No.2 in the BW Europe 50. Glaxo boosted net income 27% last year to produce an astounding 62% return on equity in 2002. Despite shareholder criticism of the size of senior executive pay-packages, CEO Jean-Pierre Garnier told shareholders in May that the group's "effective cost control" and "promising early-stage R&D pipeline" give it an edge over its competitors.One of the most striking things about the BW Europe 50 is the presence of so many energy and utility companies. In all, there are 13 producers, refiners, and distributors of oil, natural gas, and electricity. Some want to extract the energy and avoid the costly business of selling the end product. Oil giant Total, for example, is making a major bet on finding new acreage. "We are benefiting from a very clear long-term strategy of giving priority to the upstream," said Christophe de Margerie, president of exploration and production.Total benefited from a rise in world oil prices, but those companies in power generation and distribution had to combat three years of stalled demand for power by consumers and companies. Plus, privatization, deregulation, and mounting competition have limited the ability of these companies to push through rate hikes. To make matters worse, many European energy outfits temporarily fell out of favor with investors following the collapse of Enron Corp. in 2001 on the other side of the Atlantic.Despite the tough odds, European power producers such as Belgium's Electrabel (No. 4) and Italy's ENI (No. 28) managed to assert themselves. Both have a commanding presence in their domestic markets. And, as a result of collapsing borders and deregulation, they have been able to push deep into markets elsewhere in the European Union. Electrabel has made significant breakthroughs into France, Italy, and Spain, and now chalks up 37% of its sales abroad. All told, Electrabel increased sales by 18% over the past year. Its success sends an important message to the rest of Europe: Companies that exploit opportunities stemming from deregulation and the single currency are poised to excel.Then there's retail. Stagnant economies and rising joblessness have caused consumers in many parts of the Old World to pull in their horns. At the same time, fierce competition and deflationary pressures have forced down prices for many goods. That's hardly an optimal climate for retail chains. Yet seven retailers of one sort or another made it into the European BW 50. British supermarket operator Tesco PLC (No. 10) shows that grocers can sparkle even in tough markets. The group, headquartered in Hertfordshire, England, spent 300 million euros last year in a successful bid to wrest market share from rivals such as J. Sainsbury PLC, slashing prices and opening 62 new stores in Britain. Whereas many retailers saw profits plunge, Tesco's surged 14% in 2002. Tesco also runs the world's most successful online supermarket, which it is now replicating from Korea to Central Europe to the U.S., via a partnership with its American peer, Safeway.Giving customers what they want at a reasonable price is also paying big dividends at Swedish apparel retailer H&M Hennes & Mauritz (No. 8). The chain has 893 stores in 17 countries and plans to open another 110 this year, including 20 in the U.S. "We've halved the time it takes to open new stores, to an average of four to five weeks," says CEO Rolf Eriksen. "This doesn't reduce start-up costs, but it does help accelerate sales."H&M has long been an investor favorite. On the flip side, companies that investors shunned just 12 months ago are back in favor. France Télécom, for example, generated a jaw-dropping 161.6% shareholder return over the past year, thanks to the appointment of turnaround whiz Thierry Breton as CEO and investor enthusiasm for his plan to slash the company's massive debt load and trim operating expenses. Despite its improved outlook, though, France Télécom didn't make it into the top 50 because its performance in the previous two years was so dire. The same goes for other telcos such as Deutsche Telekom and Britain's BT Group, which are rebounding but still dealing with post-boom excesses.Despite their strengths, many of the companies in the BW Europe 50 face new challenges. Although there are some signs that the euro- zone economy is finally beginning to recover, consumers are still reluctant to splurge on big-ticket items. According to the European Automobile Manufacturers' Assn., European car sales were down 2.6% in unit terms during the first six months of 2003. Notwithstanding cheap financing deals and special offers, demand for autos could drop further in the coming months. Innovation, expansion into new markets, and deft control over manufacturing will set the winners apart from the losers, and likely continue to benefit the four carmakers on our list: France's PSA Peugeot Citroën (No. 15), Renault (No. 19), Germany's BMW (No. 21), and Porsche (No. 27).Luxury carmakers Porsche and BMW are expected to boost revenues and outmaneuver rivals, even in the stagnant Western European market. As the U.S. and European car markets went into a tailspin, Porsche moved quickly to trim production of its classic 911 and Boxster models. It also introduced the Cayenne, a racy new sport-utility vehicle that is powering sales and more than offsetting the decline in sportscar sales. The Stuttgart-based carmaker has returned 39% in value to shareholders over the past three years.It does help that global consumers have demonstrated a willingness to spend more of their income on luxury cars. The premium auto segment is growing at nearly twice the annual clip of the mass market. "The outlook for German luxury brands in the U.S. is extremely bright in sedans and SUVs," says Stephen B. Cheetham, auto analyst at Sanford C. Bernstein & Co.Meanwhile, the strong euro is giving headaches to many European companies -- and that could eventually include the luxury carmakers. Most vulnerable are exporters and those with large dollar revenues. If, as some currency traders predict, the euro hits $1.25 by year end, BMW, Carrefour, Sanofi-Synthélabo, and other companies with large sales outside the euro zone could see their revenues crimped.Yet for every euro loser there will be a euro winner. Companies that source a large portion of their products outside Europe stand to gain, as wages and other production costs decline when measured in euros. H&M's Eriksen says his company has already reaped some benefits. "As the euro strengthens," he says, "so does our purchasing power. That enables us to pass on those gains to consumers through lower prices."Falling interest rates could also spell relief for European businesses. With the benchmark European Central Bank rate at 2%, interest rates for most companies in the euro zone are at their lowest level in a generation. And the consensus among economists is that the ECB will cut rates again before the end of the year. On the Continent, cheap money is changing the dynamics of corporate performance. For starters, it makes it easier for heavily indebted enterprises to refinance themselves, which is one reason why many telcos have been able to stage a recovery in recent months.The biggest impact of low interest rates could be to underpin the recovery of the equity markets and create an environment in which managers are once again willing to assume big capital-market risks, such as mergers and acquisitions.The process has already started. In June, Italy's Banca Generali acquired compatriot Banca Privamera for 50 million euros in cash and 202 million euros in shares. A return to the go-go days of the late 1990s is probably still a long way off, however. And despite all the uncertainties about the euro, interest rates, and the economy, the European companies that are likely to thrive over the next year will be the ones that can do what the winners have done over the past three years: cut costs, widen margins, develop a more intimate and lucrative relationship with customers, and generate more profits.By David Fairlamb, with Jack Ewing and Gail Edmondson in Frankfurt, Kerry Capell and Stanley Reed in London, and Andy Reinhardt in Paris, and Frederick F. Jespersen in New YorkGet BusinessWeek directly on your desktop with our RSS feeds.Add BusinessWeek news to your Web site with our headline feed.Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video.To subscribe online to BusinessWeek magazine, please click here.Learn more, go to the BusinessWeekOnline home page# posted by brijesh agarwal @ 10:19 PM 0 Comments banks-financeThursday, July 12, 2007Bank 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.[3][4] Bank of America is the largest American company (by market capitalization) that is not part of the Dow Jones Industrial Average. On July 19, 2006, Bank of America reported second quarter 2006 net income of $5.48 billion,[5] surpassing that of Citigroup for the first time.Contents[hide]1 Corporate history1.1 Pre-1998 history1.1.1 Bank of Italy1.1.2 Growth in California1.1.3 Expansion outside of California1.2 Merger of NationsBank and BankAmerica1.3 History since 19981.3.1 Acquisition of National Processing Company1.3.2 FleetBoston Financial merger1.3.3 Purchase of MBNA1.3.4 Divestiture of Brazil operations1.3.5 Plans to acquire LaSalle Bank2 Bank of America today2.1 Consumer2.2 Corporate2.3 Investment Management2.4 Social responsibility3 Controversy and criticism4 International operations5 Bank of America corporate buildings6 Diversity7 Major sponsorships7.1 Official bank of8 References9 See also10 External links//[edit] Corporate historyIt has been suggested that NationsBank be merged into this article or section. (Discuss)Before 1993, the Bank of America that exists today was known as NationsBank, based in Charlotte, NC. In 1998, NationsBank merged with San Francisco-based BankAmerica and assumed the Bank of America name.[edit] Pre-1998 history[edit] Bank of ItalyThe 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 loan to those struck by the disaster.In the late 1920s, Giannini approached Orra E. Monnette, President and founder of the Los Angeles based Bank of America, Los Angeles about a potential 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 bank branching system. The merger of the two institutions 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.[edit] Growth in CaliforniaGiannini 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 of 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 of 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 2:00pm 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.[edit] Expansion outside of CaliforniaBank of America Corporate Center, located in the center of uptown Charlotte, North Carolina.Following 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 due to the placement of a series of bad loans in the Third World, particularly in Latin America. The company fired its CEO, Sam Armacost, although Armacost blamed the problems on his predecessor, A.W. (Tom) Clausen, who was then 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. On the day of the 1987 stock market crash, BankAmerica was trading at $8 per share, although by 1992 it had rebounded mightily to become one of the biggest gainers of that half-decade. The selling of the corporate headquarters building in downtown San Francisco to raise capital was a symbolic blow to the bank.[citation needed]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 biggest bank acquisition in history. Federal regulators nevertheless forced the sale of Security Pacific's Washington subsidiary, Rainier Bank, because 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 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 and NationsBank executed a merger-of-equals and changed the headquarters to Charlotte, North Carolina.[edit] Merger of NationsBank and BankAmericaIn 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.[edit] History since 1998In 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.[edit] Acquisition of National Processing CompanyIn 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.[edit] FleetBoston Financial mergerAlso in 2004 , Bank of America acquired Boston, Massachusetts-based FleetBoston Financial for $47 billion 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).[edit] Purchase of MBNAOn 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 combined Bank of America Card Services organization, FIA Card Services - including the former MBNA - will have more than 40 million U.S. accounts and nearly $140 billion in outstanding balances.[edit] Divestiture of Brazil operationsIn May 2006, the Bank of America and Banco Itau - (Investimentos Ita S.A.) entered into an acquisition agreement through which the Banco agreed to acquire BankBoston's operations in Brazil. BankBoston's Brazil includes asset management, private banking, a credit card portfolio, and small, middle-market, and large corporate segments. It has 66 branches and 203,000 clients in Brazil. BankBoston in Chile has 44 branches and 58,000 clients and in Uruguay it has 15 branches. In addition, there is also a credit card Company, OCA, in Uruguay, which has 23 branches. BankBoston N.A. in Uruguay, together with OCA, jointly serve 372,000 clients. After the merger 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. Itaú also received exclusive rights to purchase BankBoston's operations in Chile and Uruguay. In return, Bank of America has taken about a 6% stake in Itaú. Banco Boston do Brazil had been founded in 1947 . With the purchase, the BankBoston name will disappear from Brazil as Bank of America has retained the rights to the name and in which they can't use the name due to the merger agreements.[edit] Plans to acquire LaSalle BankOn April 23, 2007, Bank of America announced plans to acquire LaSalle Bank Corporation from ABN AMRO for $21 billion,[6] which will increase Bank of America's presence in Illinois, Michigan, and Indiana. Bank of America was also expected to thereby become the largest bank in the Chicago market. The sale is expected to close in late 2007 or early 2008.[7] The LaSalle acquisition would put Bank of America just above the 10% mandated limit imposed by the Federal government of the total bank deposits in the country. However, on May 3, 2007 a Dutch court blocked the sale until it can be approved by shareholders of ABN AMRO as part of a larger merger discussion involving Barclays Bank and Royal Bank of Scotland(RBS). RBS has made a competing $24.5 billion bid for LaSalle Bank.[8] Both ABN AMRO and Bank of America appealed to the decision of the Dutch court, and on June 26, the Advocate-General advised to the highest Dutch court to destroy the regulation which blocked the sale, saying approval of the shareholders isn't necessary.[9] Since in four out of five cases the judgement of the highest court follows the advice by the Advocate-General, it is likely that the Bank of America can buy LaSalle without approval of ABN AMRO's shareholders.[edit] Bank of America todayBank of America ATMBank of America branch in Lowell, MA with error in signage.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.Bank of America today comprises three main divisions.[edit] ConsumerTypical Bank of America local officeGlobal 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).[10][edit] CorporateGlobal Corporate and Investment Banking, also known as Banc of America Securities, provides mergers and acquisitions advisory, underwriting, as well as 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.[edit] Investment ManagementGlobal 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 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.[edit] Social responsibilityIn 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.[11]In addition to trying to help the environment, Bank of America has also donated money to help health centers in Massachusetts[12] and made donations to help homeless shelters in Miami.[13][edit] Controversy and criticismMain article: Bank of America controversiesBank 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, and early account closures, have become heavily criticized. Bank of America controversies details some of the more notable and public issues.[edit] International operationsIn 2005, Bank of America acquired a 9% stake in China Construction Bank, China's second largest bank, for $3 billion.[14] 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 also invested in opening new branches in India, particularly Mumbai.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.[edit] Bank of America corporate buildingsBank of America Plaza, Atlanta, GA.Bank of America Tower in Tampa, FloridaBank of America Fifth Avenue Plaza in SeattleColumbia Center in Seattle (formerly known as Bank of America Tower)Bank of America Tower in St Petersburg, FLBank of America Tower in Providence, RIBank of America Tower in New York City (under construction)Bank of America Tower in Jacksonville, FLBank of America Tower in Albuquerque, NMBank of America Tower in Hong KongBank of America Tower in Tampa, FLBank of America Plaza in St LouisBank of America Tower in Richmond, VABank of America Tower in Miami, FLBank of America Tower in Lubbock, TXBank of America Tower in Los AngelesBank of America Tower in Boca RatonBank of America Center in HoustonBank of America Center in San FranciscoBank of America Banking Center in Washington, DC (across from the White House)Bank of America Plaza in Atlanta, GABank of America Plaza in Charlotte, NC which is adjacent to the Bank of America Corporate CenterBank of America Plaza in Dallas, TXBank of America Building in Chicago, Illinois[edit] DiversityBank of America in Washington, D.C.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.[edit] Major sponsorshipsBank of America owns the naming rights of several venues in the sports world.Bank of America Stadium, Charlotte, North Carolina - Carolina Panthers, NFL.Bank of America Arena, Seattle, Washington - University of Washington men's and women's basketballBank of America 500, a NASCAR race that is hosted annually at Lowe's Motor Speedway, Concord, North Carolina[edit] Official bank ofUnited States Olympic TeamNASCARMajor League BaseballMinor League BaseballLittle LeagueCarolina Panthers, a NFL team.New England Patriots, a NFL teamBoston Red Sox, a MLB team.New York Yankees, a MLB team.San Francisco Giants, a MLB team.St. Louis Cardinals, a MLB team.New England Revolution, a MLS team.Ad campaigns that run during the Little League World Series and the World Series use the slogan "The Official Bank of Baseball."[edit] References^ Bank of America (2007-02-22). Bank of America to Unveil New Brand Campaign Celebrating the Power of Opportunity. Press release.^ Bank of America (2007-01-23). Bank of America Reports Record 2006 Earnings of $21.13 Billion, or $4.59 Per Share. Press release.^ The Largest Banks in the U.S. (List). The New York Job Source (2006-06-30).^ United States' Largest Banks (List). Pearson Education, Inc. (2005-12-31).^ Bank of America (2006-07-19). Bank of America Reports Record Second Quarter Earnings of $5.5 Billion, or $1.19 Per Share. Press release. Retrieved on 2007-05-05.^ ABN AMRO (2007-04-23). ABN AMRO announces USD 21 billion sale of LaSalle to Bank of America. Press release.^ Bank of America (2007-04-23). Bank of America Agrees to Acquire LaSalle Bank. Press release.^ "RBS Group Makes Bid for LaSalle", TheStreet.com, 2007-05-05. Retrieved on 2007-05-05.^ "Geen stemming nodig verkoop LaSalle", NU.nl, 2007-06-26. Retrieved on 2007-06-26.^ "Five big banks form Global ATM Alliance", ATMmarketplace.com. January 9, 2002. Accessed June 22, 2007.^ "Bank vows $20 billion for green projects", msnbc, 2007-03-07.^ Kowalczyk, Liz. "Bank to aid health centers", The Boston Globe, 2007-03-10.^ Freer, Jim. "BofA donates $1M to Camillus House", South Florida Business Journal, 2007-03-09.^ "Bank of America invests in China", BBC, 2005-06-17.Bonadio, Felice A. A.P. Giannini: Banker of America. Berkeley, Calif.: University of California Press, 1994.Hector, Gary. Breaking the Bank: The Decline of BankAmerica. Boston: Little, Brown, 1988.James, Marquie and Bessie. Biography of a Bank: The Story of Bank of America N.T.&S.A. New York: Harper and Brothers, 1954.Johnston, Moira. Roller Coaster: The Bank of America and the Future of American Banking. New York: Ticknor & Fields, 1990.Lampert, Hope. Behind Closed Doors: Wheeling and Dealing in the Banking World. New York: Atheneum, 1986.Monnette, Orra Eugene. Personal Papers Collection. Los Angeles Public Library (Main), Los Angeles California.Nash, Gerald G. A.P. Giannini and the Bank of America. Norman, Okla.: University of Oklahoma Press, 1992.Yockey, Ross. McColl: The Man with America's Money. Atlanta: Longstreet Press, 1999.Ahmed, Azam and Demirjian, Karoun. Credit offered to illegal residents., Chicago Tribune, Feb. 15, 2007.Boyle, Matthew. The Dirty Half-Dozen: America's Worst Boards For those who track bad corporate. Fortune, May 14, 2001.[edit] See alsoBanc of America Securities, Bank of America's investment banking divisionBanc of America Investment Services, Inc.FleetBostonMBNAList of bank mergers in United StatesBank of America CanadaBank of America (Asia)[edit] External linksBankOfAmerica.com PC / Mac homepageBOFA.mobi Mobile homepageYahoo! - Bank of America Corporation Company ProfileFor more information about bank market share, see the FDIC's web site, which includes historical data50 largest American banks and bank holding companiesABN AMRO North America • Associated • BancWest • Bank of America • Bank of New York Mellon • BB&T • BOK Financial • Capital One • Charles Schwab • Citigroup • Citizens Financial Group • Colonial • Comerica • Commerce Bancorp • Commerce Bancshares • Compass • Fifth Third • First BanCorp • First Citizens • First Horizon National • Fulton • Harris • HSBC Bank USA • Huntington • JPMorgan Chase • Key • M&T • Marshall & Ilsley • National City • New York Community • New York Private Bank & Trust • Northern Trust • PNC • Popular • Regions • RBC Centura • Sky • State Street • SunTrust • Synovus • Taunus • TD Banknorth • U.S. Bancorp • UnionBanCal • W Holding • Wachovia • Webster • Wells Fargo • Zions BancorporationRetrieved from "http://en.wikipedia.org/wiki/Bank_of_America"Categories: Current events as of April 2007 Companies listed on the New York Stock Exchange Companies listed on the Tokyo Stock Exchange Articles to be merged since April 2007 Articles with unsourced statements since May 2007 All articles with unsourced statements Companies established in 1874 Bank of America Banks of the United States Charlotte, North Carolina Companies based in North Carolina Bank of America legacy banksposted by parichay perikal j at 9:09 PM 0 Comments 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.[3][4] Bank of America is the largest American company (by market capitalization) that is not part of the Dow Jones Industrial Average. On July 19, 2006, Bank of America reported second quarter 2006 net income of $5.48 billion,[5] surpassing that of Citigroup for the first time.Contents[hide]1 Corporate history1.1 Pre-1998 history1.1.1 Bank of Italy1.1.2 Growth in California1.1.3 Expansion outside of California1.2 Merger of NationsBank and BankAmerica1.3 History since 19981.3.1 Acquisition of National Processing Company1.3.2 FleetBoston Financial merger1.3.3 Purchase of MBNA1.3.4 Divestiture of Brazil operations1.3.5 Plans to acquire LaSalle Bank2 Bank of America today2.1 Consumer2.2 Corporate2.3 Investment Management2.4 Social responsibility3 Controversy and criticism4 International operations5 Bank of America corporate buildings6 Diversity7 Major sponsorships7.1 Official bank of8 References9 See also10 External links//[edit] Corporate historyIt has been suggested that NationsBank be merged into this article or section. (Discuss)Before 1993, the Bank of America that exists today was known as NationsBank, based in Charlotte, NC. In 1998, NationsBank merged with San Francisco-based BankAmerica and assumed the Bank of America name.[edit] Pre-1998 history[edit] Bank of ItalyThe 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 loan to those struck by the disaster.In the late 1920s, Giannini approached Orra E. Monnette, President and founder of the Los Angeles based Bank of America, Los Angeles about a potential 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 bank branching system. The merger of the two institutions 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.[edit] Growth in CaliforniaGiannini 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 of 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 of 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 2:00pm 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.[edit] Expansion outside of CaliforniaBank of America Corporate Center, located in the center of uptown Charlotte, North Carolina.Following 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