Bank of America

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Bank of America Corporation

logo
legal form Corporation
ISIN US0605051046
founding 1923
Seat Charlotte , United States
management Brian Moynihan (Chairman & CEO )
Number of employees 208,000 (2019)
sales 91,240,000,000 US dollars (2019)
Branch Banks
Website www.bankofamerica.com
As of December 31, 2019

The Bank of America Corporation ( BofA , BoA , BAC ) is a major US bank with headquarters in Charlotte , North Carolina . The company was at times the largest credit institution in the United States since July 2006 . The bank's origins go back to the Bank of Massachusetts , which was founded in 1784 , which also makes it the second oldest bank in the United States. The company is listed on the NYSE and the Tokyo Stock Exchange . The Bank of America brand was the most valuable brand in the banking sector in 2008 at $ 33.1 billion, making it 14th worldwide . Measured in terms of equity , it was classified as the largest bank in the world by the British trade magazine The Banker in 2012 .

In 2016, the bank employed 208,000 people in 5,700 branches and had sales of 85 billion US dollars. The total assets were reported at 2.18 trillion US dollars in 2016 .

Bank of America is on the list of globally systemically important banks , so it is one of the 30 major banks that have been classified as a systemically important financial institution by the Financial Stability Board (FSB) . It is therefore subject to special monitoring and stricter requirements for the endowment with equity.

history

BofA was created through a long series of mergers and acquisitions. The namesake was founded in 1923 as Bank of America , Los Angeles , by Orra E. Monnette and merged in 1929 with the Bank of Italy , San Francisco . Various laws and regulations initially reduced their growth to California . In 1958 the Jesuit Order held 51 percent of the shares. Only after these restrictions were removed could expansion continue in 1983 with the purchase of Seafirst Corporation , Seattle . 1992 saw the largest takeover in history in the banking sector with the purchase of the Security Pacific Corporation .

NationsBank

The emergence of the nation's bank to the year 1874 back when the Commercial National Bank was established that the 1957 American Trust Co. for American Commercial Bank merged. In 1960 the name was changed to North Carolina National Bank and in 1992, after a series of acquisitions, to NationsBank .

Bank of America

Today's Bank of America was eventually created through the acquisition of Bank of America by NationsBank in 1998. NationsBank, based in Charlotte, also took over the name Bank of America with the purchase, with the company's headquarters remaining in North Carolina. The new company continued its expansion and also acquired FleetBoston Financial , based in Boston , the establishment of which dates back to 1784.

BankAmericard

The BankAmericard is the predecessor of the VISA card ; the Bank of America is considered the inventor with the publication of the first credit cards in 1959. 1977 was renamed VISA.

Banking and financial crisis from 2008

Due to the financial crisis in 2007/2009 , Bank of America bought the troubled company Countrywide Financial for 2.5 billion US dollars . On September 15, 2008, it was announced that Merrill Lynch , at that time the third largest investment bank in the United States, would be acquired. The acquisition was paid for in $ 50 billion worth of shares. The purchase of Lehman Brothers , the fourth largest investment bank in the US, has been canceled by Bank of America. On the same day, Lehman Brothers filed for bankruptcy . So far, Bank of America has received $ 25 billion from the state bank rescue plan. On November 17, 2008, it announced that it was exercising the remainder of an option to buy shares in the sovereign wealth fund China Safe Investments as a long-term strategic investment , holding 44.7 billion shares in China Construction Bank : a value was written to them at the time of purchase of about $ 24 billion too.

A press release was published on December 11, 2008, according to which between 30,000 and 35,000 jobs are to be cut within three years. In January 2009 it was announced that Bank of America from the US federal government additional 20 billion US dollars will receive from the government bailout. In return, the state will receive Bank of America preferred stock . In the fourth quarter, the provision for loan defaults, write-offs and losses in the trading business was a loss of 2.4 billion US dollars.

Bank of America's share price fell from $ 50 in April 2007 to $ 3.14 in March 2009 during the crisis.

On September 22, 2009, the bank announced that it would leave the state protective shield and pay a total of 425 million US dollars to the Treasury, the central bank and the deposit insurance for the termination of the security agreement. The bank has repaid all of its $ 45 billion in debt to the US government in one fell swoop. The bank raised the money for this by issuing convertible bonds and selling its own assets.

On October 20, 2010, it was announced that a group of investors wanted to force Bank of America to buy back problematic mortgages packed in bonds (see also subprime market ) worth around 47 billion US dollars. A total of eight investors accused the bank of mistakes in handling the mortgages and misleading information about the quality of the papers.

On June 29, 2011, Bank of America announced that it had entered into a $ 8.5 billion settlement with the relevant investors. For other controversial cases, another 5.5 billion US dollars were set aside by the bank.

Similarly, on August 25, 2011, it was announced that Warren Buffett was investing $ 5 billion in Bank of America. For this, Buffett received preferred shares with an interest rate of six percent per year.

On August 29, 2011, Bank of America announced that it is selling half of the 10 percent US $ 8.3 billion stake in China Construction Bank to undisclosed investors to increase equity . The bank will keep a share of around five percent. On November 14, 2011, Bank of America announced that it had sold an additional 10.4 billion shares in China Construction Bank. BofA now holds just under 1 percent of the China Construction Bank. With the sale of shares, Bank of America wanted to increase its core capital ratio.

In September 2011, the rating agency Moody’s downgraded the creditworthiness of Bank of America's long-term loans by two notches from “A2” to “Baa1”. It is less likely that the US government will step in to save a troubled big bank from a crisis.

For the first quarter of 2012, the Bank of America Chart showed a profit of 328 million US dollars (for comparison: JP Morgan Chase 5.4 billion; Citigroup 2.9 billion US dollars). On May 1, 2012 it was announced that the BoA 2000 plans to fire high-paid officials in investment banking .

Bank of America is the first credit institution among the main members of the FIDO alliance , which since 2013 has developed the industry standard Universal Second Factor (U2F) for generally applicable two-factor authentication .

As a result of the financial crisis, a new record fine is looming for Bank of America. The bank faces a new fine of at least $ 12 billion for improper mortgage deals. Out-of-court settlement negotiations are ongoing with the US Department of Justice and several state agencies. Government negotiators are pushing for a significantly higher fine.

Takeover of Merrill Lynch

On 14 September 2008, the Bank of America expressed its intention to Merrill Lynch & Co., Inc. to buy. Effective January 1, 2009, Merrill Lynch became a subsidiary of Bank of America.

Business figures

Business and employee development (the fiscal year ends on June 30th)
year Total assets
in US $ million 		Sales
in US $ million 		Balance sheet profit
in million US $ 		Price per share
in US $
2005 1,291,803 85.064 16,447 34.30
2006 1,459,737 116,767 21,111 39.61
2007 1,715,746 119,696 14,692 41.23
2008 1,817,943 113.106 2,487 27.08
2009 2.230.232 150,450 −2,204 11.46
2010 2,264,909 134.194 −3,599 13.66
2011 2,129,046 115.074 85 9.36
2012 2,209,974 100,078 2,760 7.93
2013 2.102.273 101,697 10,082 12.67
2014 2,104,534 96,829 4,476 15.45
2015 2,144,287 93,514 14,427 15.84
2016 2,188,067 93,662 16,140 14.95
2017 2,281,234 100.264 16,618 24.32
2018 2,354,507 109,627 26,696 29.70
2019 2,434,079 113,589 25,998 29.56

Shareholders

One of the biggest stakeholders in 2011 was the investment company Warren Buffett's Berkshire Hathaway via subscription rights

According to nasdaq, the top five institutional investors are the following

1. BERKSHIRE HATHAWAY INC 679,000,000
2. VANGUARD GROUP INC 671,120,942
3. BLACKROCK INC. 661,920,128
4th STATE STREET CORP 420,649,352
5. FMR LLC 342,334,404

building

Bank of America Tower in New York

Over time, Bank of America commissioned construction contracts for tall buildings in various American cities to set up some offices there. Well-known buildings are:

Web links

Commons : Bank of America  - Collection of Pictures, Videos and Audio Files

Individual evidence

  1. ↑ a b c Annual Report 2019. Retrieved on June 4, 2020 (English).
  2. ↑ Top 100: The Most Expensive Brands in the World. In: Spiegel Online . April 21, 2008, accessed February 12, 2015 .
  3. ↑ These are the largest banks in the world. In: finews.ch. July 2, 2012, accessed February 12, 2015 .
  4. ^ Policy Measures to Address Systemically Important Financial Institutions. In: Financial Stability Board (FSB) of November 4, 2011 (PDF file; 105 kB)
  5. ↑ Update of the group of global systemically important banks (G-SIBs) (PDF; 43 kB) from November 1, 2012.
  6. ↑ Financial policy: The major shareholder . In: Der Spiegel . No. 33 , 1958 ( online - 13 August 1958 ).
  7. ↑ James Bates: BankAmerica Takes Over at Security Pacific: Acquisitions: The merger becomes official today, creating the nation's second-largest banking company. In: Los Angeles Times . April 22, 1992, ISSN  0458-3035 (English, latimes.com [accessed August 23, 2017]).
  8. ^ Bank of America Merrill Lynch: Helping clients in Latin America 'connect the dots' . In: miamiherald . ( miamiherald.com [accessed August 28, 2017]).
  9. ↑ Belk once sold fishhooks ... and more about companies with Charlotte roots . In: charlotteobserver . ( charlotteobserver.com [accessed August 28, 2017]).
  10. ↑ Institution History. Retrieved August 28, 2017 .
  11. ^ Hugh McColl calls state LGBT law 'inappropriate, unnecessary legislation' . In: charlotteobserver . (English, charlotteobserver.com [accessed August 28, 2017]).
  12. ↑ Marc Pitzke: Mortgage Crisis: Crash of the American House Brand. In: Spiegel Online . January 11, 2008, accessed February 12, 2015 .
  13. ↑ Bank of America Buys Merrill Lynch Creating Unique Financial Services Firm , Bank of America, press release September 15, 2008.
  14. ^ Bank of America boosts stake in big Chinese bank. In: Reuters. November 17, 2008, accessed November 19, 2008 .
  15. ↑ Bank of America increases stake in third largest bank in China. In: Reuters. November 18, 2008, accessed November 19, 2008 .
  16. ↑ Bank of America Plans to Reduce Work Force , Bank of America, December 11, 2008
  17. ↑ Bank of America receives state aid. Archived from the original on January 12, 2010 ; accessed on March 23, 2015 . ARD online, January 16, 2009.
  18. ↑ Deep red quarter: Citigroup and Bank of America report gigantic losses. In: Spiegel Online . January 16, 2009, accessed February 12, 2015 .
  19. ↑ Chart of the share
  20. ↑ FAZ.NET: Bank of America parts with state aid. In: FAZ.net . September 22, 2009, accessed February 12, 2015 .
  21. ↑ börsennews.de: Bank of America pays state aid back in full, accessed on December 10, 2009
  22. ↑ Fed and Pimco demand billions from Bank of America ( Memento of October 22, 2010 in the Internet Archive ), FTD (Financial Times Deutschland), October 20, 2010
  23. ↑ Troubled Financial Institution - Buffett invests $ 5 billion in Bank of America. In: sueddeutsche.de . August 25, 2011, accessed February 12, 2015 .
  24. ↑ dpa, Reuters: Bank of America collects eight billion dollars. In: handelsblatt.com . August 29, 2011, accessed February 12, 2015 .
  25. ↑ Overview / Company - 5 p.m. version. In: finanzen.net. November 14, 2011, accessed February 12, 2015 .
  26. ↑ Rating: Moodys downgrades three US banks. In: Focus Online . September 21, 2011, accessed February 12, 2015 .
  27. ↑ Elite dismissal: Bank of America wants to fire 2000 high earners. In: Spiegel Online . May 1, 2012, accessed February 12, 2015 .
  28. ↑ Norbert Kuls: Bank of America threatens a new billion dollar fine . In: FAZ.net . June 6, 2014, accessed February 12, 2015 .
  29. ↑ Bank Of America - 32 Year Stock Price History | BAC. Retrieved October 22, 2018 .
  30. ↑ Buffett invests $ 5 billion in Bank of America . In: sueddeutsche.de . August 25, 2011, ISSN  0174-4917 ( sueddeutsche.de [accessed on May 23, 2018]).
  31. ^ John Maxfield: Who Is Bank of America's Biggest Shareholder? The Answer May Surprise You . In: The Motley Fool . ( fool.com [accessed May 23, 2018]).
  32. ^ Bank of America Corporation (BAC) Ownership Summary. Retrieved May 23, 2018 (American English).