First Bank of the US Founded - History

First Bank of the US Founded - History

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First Bank of the Untied States

Hamilton urged the founding of the Bank of the United States. Jefferson opposed the idea. The Bank was to be a depository of federal funds and a means of regulating the currency. Its establishment, in February 1791, strengthened the federal government.

The Bank was part of the Hamiltonian plan for American economic development. Hamilton was concerned to place America on a firm economic footing to compete in the world. His plan called for raising money through an excise tax on whiskey; instituting a system of tariffs on the importation of manufactured goods and establishing a national bank.

The Bank of the United States was designed to create a sound United States monetary policy. The Bank was to hold all government deposits. It would issue bank notes, in place of all outstanding federal debts. This would give the United States a sound paper currency. The Bank of the United States was approved narrowly with sectional support key. Most of the representatives from the Northeast voted in favor of the plan, while most Southern Representatives voted against.

The bank was a private institution chartered by the government and when the stock of the bank went on sale it was in great demand. The bank remained controversial with many common citizens believing it was just an instrument for the wealthy to get ever richer.

The History of Bank of America

Erin O'Neil is an expert and consultant with many years of experience in both banking and finance. While she began her career in real estate, she currently works for a wealth management firm that uses a holistic approach to financial planning. Erin continues to work with a broad range of clients, helping them address all financial planning and wealth management needs they come across.

If you are looking to establish a banking relationship defined by convenience, one-stop shopping, online accessibility, and a broad range of products and services, you should consider large national banks. Among them, one of the largest is Bank of America, commonly referred to as BofA.

As of October 2020, Bank of America serves roughly 66 million customers, including both consumers and small businesses. The bank operates approximately 4,300 retail financial centers, 17,000 ATMs, and online banking software with approximately 39 million active users, 31 million of whom access the software through BofA's mobile app. The company specializes in small business support and boasts 3 million small business owners as customers. In addition to the U.S. and its territories, BofA also operates in 35 countries abroad.

First Bank of the United States.

The First Bank of the United States was needed because the government had a debt from the Revolutionary War, and each state had a different form of currency. It was built while Philadelphia was still the nation's capital. Alexander Hamilton conceived of the bank to handle the colossal war debt &mdash and to create a standard form of currency.

Up to the time of the bank's charter, coins and bills issued by state banks served as the currency of the young country. The First Bank's charter was drafted in 1791 by the Congress and signed by George Washington. In 1811, Congress voted to abandon the bank and its charter. The bank was originally housed in Carpenters' Hall from 1791 to 1795. The neo-classical design of the bank was intended to recall the democracy and splendor of ancient Greece. When you're there, note the eagle which crowns the two-story portico. At the time of the bank's creation the eagle had been our national symbol for only 14 years. The bank building was restored for the Bicentennial in 1976.

Bank of America

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Bank of America, in full Bank of America Corporation, one of the largest banking and financial services corporations in the United States. It was formed through NationsBank’s acquisition of BankAmerica in 1998. Bank of America is headquartered in Charlotte, North Carolina.

The bank’s history dates to 1904 when Amadeo Peter Giannini opened the Bank of Italy in San Francisco. It eventually developed into the Bank of America and was for a time owned by Giannini’s holding company, Transamerica Corporation. It issued the first bank credit card, BankAmeriCard, in 1958. (The first universal credit card, which could be used at a variety of establishments, had been introduced by the Diners’ Club, Inc., in 1950.)

The Genesis of Modern Central Banking Goals

Before 1914, central banks didn&rsquot attach great weight to the goal of maintaining the domestic economy&rsquos stability. This changed after World War I, when they began to be concerned about employment, real activity, and the price level. The shift reflected a change in the political economy of many countries&mdashsuffrage was expanding, labor movements were rising, and restrictions on migration were being set. In the 1920s, the Fed began focusing on both external stability (which meant keeping an eye on gold reserves, because the U.S. was still on the gold standard) and internal stability (which meant keeping an eye on prices, output, and employment). But as long as the gold standard prevailed, external goals dominated.

Unfortunately, the Fed&rsquos monetary policy led to serious problems in the 1920s and 1930s. When it came to managing the nation&rsquos quantity of money, the Fed followed a principle called the real bills doctrine. The doctrine argued that the quantity of money needed in the economy would naturally be supplied so long as Reserve Banks lent funds only when banks presented eligible self-liquidating commercial paper for collateral. One corollary of the real bills doctrine was that the Fed should not permit bank lending to finance stock market speculation, which explains why it followed a tight policy in 1928 to offset the Wall Street boom. The policy led to the beginning of recession in August 1929 and the crash in October. Then, in the face of a series of banking panics between 1930 and 1933, the Fed failed to act as a lender of last resort. As a result, the money supply collapsed, and massive deflation and depression followed. The Fed erred because the real bills doctrine led it to interpret the prevailing low short-term nominal interest rates as a sign of monetary ease, and they believed no banks needed funds because very few member banks came to the discount window.

After the Great Depression, the Federal Reserve System was reorganized. The Banking Acts of 1933 and 1935 shifted power definitively from the Reserve Banks to the Board of Governors. In addition, the Fed was made subservient to the Treasury.
The Fed regained its independence from the Treasury in 1951, whereupon it began following a deliberate countercyclical policy under the directorship of William McChesney Martin. During the 1950s this policy was quite successful in ameliorating several recessions and in maintaining low inflation. At the time, the United States and the other advanced countries were part of the Bretton Woods System, under which the U.S. pegged the dollar to gold at $35 per ounce and the other countries pegged to the dollar. The link to gold may have carried over some of the credibility of a nominal anchor and helped to keep inflation low.

The picture changed dramatically in the 1960s when the Fed began following a more activist stabilization policy. In this decade it shifted its priorities from low inflation toward high employment. Possible reasons include the adoption of Keynesian ideas and the belief in the Phillips curve trade-off between inflation and unemployment. The consequence of the shift in policy was the buildup of inflationary pressures from the late 1960s until the end of the 1970s. The causes of the Great Inflation are still being debated, but the era is renowned as one of the low points in Fed history. The restraining influence of the nominal anchor disappeared, and for the next two decades, inflation expectations took off.

The inflation ended with Paul Volcker&rsquos shock therapy from 1979 to 1982, which involved monetary tightening and the raising of policy interest rates to double digits. The Volcker shock led to a sharp recession, but it was successful in breaking the back of high inflation expectations. In the following decades, inflation declined significantly and has stayed low ever since. Since the early 1990s the Fed has followed a policy of implicit inflation targeting, using the federal funds rate as its policy instrument. In many respects, the policy regime currently followed echoes the convertibility principle of the gold standard, in the sense that the public has come to believe in the credibility of the Fed&rsquos commitment to low inflation.

A key force in the history of central banking has been central bank independence. The original central banks were private and independent. They depended on the government to maintain their charters but were otherwise free to choose their own tools and policies. Their goals were constrained by gold convertibility. In the twentieth century, most of these central banks were nationalized and completely lost their independence. Their policies were dictated by the fiscal authorities. The Fed regained its independence after 1951, but its independence is not absolute. It must report to Congress, which ultimately has the power to change the Federal Reserve Act. Other central banks had to wait until the 1990s to regain their independence.

“US Bancorp History

Today’s U.S. Bank was forged during the 1990s from the acquisitions of several major regional banks in the West and Midwest. Those banks, in turn, had grown from the mergers of numerous smaller banks throughout the years. Since 1988 alone, mergers with and acquisitions of more than 50 banks, large and small, have helped form today’s U.S. Bank.

The U.S. Bank name first appeared as United States National Bank of Portland, established in Portland, Oregon in 1891 it changed its name to the United States National Bank of Oregon in 1964. In 1902, it merged with Ainsworth National Bank of Portland, but kept the U.S. National Bank name. The decision turned out to be fortuitous, as a 1913 federal law prohibited other banks from using “United States” in their names from that time forward. U.S. National was among the first banks to form a bank holding company — called U.S. Bancorp.

The central part of the franchise dates from 1864, with the formation of First National Bank of Minneapolis. In 1929, that bank merged with First National Bank of St. Paul (also formed in 1864) and several smaller Upper Midwest banks to form the First Bank Stock Corporation, which changed its name to First Bank System in 1968.

In the eastern part of the franchise, when Farmers and Millers Bank in Milwaukee opened its doors in 1853, growing into the First National Bank of Milwaukee and eventually becoming First Wisconsin and ultimately Firstar. In Cincinnati, First National Bank of Cincinnati opened for business in 1863 under National Charter #24 with the boom of Civil War cannons firing just across the Ohio, but it survived through many more decades to grow into Star Bank.

These banks thrived as independent entities. As opportunities arose, each participated in in-market mergers and acquisitions during the early decades of the 20th century and in more widespread expansions during the 1980s and 1990s — including the 1993 transaction that brought Colorado National Bank in Denver into the First Bank System, and West One Bancorp of Boise, Idaho, coming into the original U.S. Bancorp in 1995.

In 1997, U.S. Bancorp merged into First Bank System. Although First Bank System was the surviving company and corporate headquarters stayed in Minneapolis, the merged bank took the U.S. Bancorp name.

In 1999, Firstar merged with Star Bank, and acquired Mercantile five months later. The present-day company was formed when Firstar bought U.S. Bancorp, a deal which closed on February 27, 2001. While Firstar was the surviving company, it changed its name to U.S. Bancorp and moved its headquarters to Minneapolis.

On December 13, 2001, two business lines of Firstar switched to the U.S. Bancorp name, the first name changes after the Firstar/U.S. Bancorp merger.

On August 10, 2004, U.S. Bancorp announced it had raised its prime lending rate to 4.50 percent from 4.25 percent at all U.S. Bank locations.

On November 14, 2008, U.S. Bancorp received $6,599,000,000 from the Emergency Economic Stabilization Act in the form of a preferred stock and related warrants. On November 21, 2008 U.S. Bank purchased Downey Savings & Loan Assn FA from Downey Financial Corp and Pomona First Fed Bk & Tr(PFF) from PFF Bancorp Inc,CA. At year-end 2008, U.S. Bancorp had total assets of $266 billion, and U.S. Bank was the 6th-largest commercial bank within the United States. On June 17, 2009, U.S. Bancorp redeemed the $6.6 billion of preferred stock and on July 15, 2009, it completed the purchase of a warrant held by the U.S. Treasury Department. This effectively concluded U.S. Bancorp’s participation in the Capital Purchase Program. It was among the first banks to repay the Troubled Asset Relief Program (TARP) funds.

During October 2009 US Bancorp announced four separate acquisitions:

  • On October 5, 2009 US Bancorp announced its acquisition of the mutual fund administration and accounting servicing division of Fiduciary Management, Inc.
  • On October 7, 2009 U.S. Bank, agreed to buy the bond trustee business of First Citizens Bank, a subsidiary of First Citizens BancShares Inc.
  • On October 14, 2009 U.S. Bank agreed to acquire the Nevada banking operations of BB&T Corp.
  • On October 20, 2009 US Bancorp completed a transaction to purchase FBOP Corporation’s nine subsidiary banks from the FDIC: BankUSA, National Association (AZ), California National Bank (CA), Citizens National Bank (TX), Community Bank of Lemont (IL), Madisonville State Bank (TX), North Houston Bank (TX), Pacific National Bank (CA), Park National Bank (IL), and San Diego National Bank (CA). (US Bancorp subsequently sold the three banks in Texas in 2010 to Houston-based Prosperity Bancshares.)

On January 28, 2011, US Bancorp acquired the assets and deposits of First Community Bank of New Mexico. That is the first entry into New Mexico, its 25th state.

On January 27, 2012, US Bancorp acquired the assets and deposits of failed Knoxville, Tennessee-based BankEast, which was closed by state regulators. The bank’s ten branches were rebranded as US Bank branches the following Monday.

On January 7, 2014, US Bancorp announced that it was acquiring 94 branches of Charter One Bank in Chicago from RBS Citizens Financial Group as of mid-2014. It will double its market share in Chicago.

U.S. Bank Place
601 Second Avenue South
Minneapolis, Minnesota 55402-4302


Public Company
Incorporated: 1929 as First Bank Stock Investment Company
Employees: 26,891
Total Assets: $81.53 billion (1999)
Stock Exchanges: New York
Ticker Symbol: USB
NAIC: 551111 Offices of Bank Holding Companies 52211 Commercial Banking (pt) 52221 Credit Card Issuing (pt) 52232 Financial Transactions Processing 52239 Other Activities Related to Credit Intermediation (pt)

Company Perspectives:

We strive to create superior value for our shareholders by fulfilling our customer promise.
We simplify our customers' lives by delivering anytime, anywhere access to a comprehensive range of financial solutions. This is the essence of the U.S. Bancorp brand. 'Simplify' means satisfying customer expectations for quality, convenience and execution, while meeting the need for confidence and security. 'Access' is providing a wide range of choices for doing business with us. 'Solutions' result from our knowledge of the customer, the superior performance of our products and services, and the expertise of our people.

Key Dates:

1891: United States National Bank of Portland is founded.
1902: United States National and Ainsworth National merge.
1925: United States National merges with Ladd and Tilton, Oregon's oldest bank.
1929: First Bank Stock Investment Corporation is formed.
1964: United States National Bank of Portland is renamed United States National Bank of Oregon.
1968: First Bank Stock Investment Corporation is renamed First Bank System, Inc. United States National Bank reorganizes as a holding company called U.S. Bancorp.
1988: First Bank National Association is formed through the merger of large banks in Minneapolis, St. Paul, and the greater Twin Cities region.
1990: First Bank hires John (Jack) Grundhofer as CEO, chairman, and president.
1993: First Bank acquires U.S. Bancorp's corporate trust operations in Oregon and Washington.
1995: U.S. Bancorp acquires West One Bancorp of Idaho.
1997: In its largest acquisition, First Bank purchases U.S. Bancorp and adopts the U.S. Bancorp name company also acquires Piper Jaffray Companies Inc.

U.S. Bancorp, headquartered in Minneapolis, is the nation's 11th largest financial services holding company, operating in 16 states in the West and Midwest, through more than 1,000 banking locations. U.S. Bancorp is a leading provider of corporate trust services and is the leading supplier worldwide of Visa corporate and purchasing cards. The company also offers investment, payment systems, asset management, insurance, and banking services to consumers and businesses. Subsidiary U.S. Bancorp Piper Jaffray provides brokerage and investment banking services through some 100 offices.

History of First Bank System Inc.

In April 1929, just one-half year before the great stock market crash, 85 banks located in the Ninth Federal Reserve district joined together in a loose confederation called First Bank Stock Investment Corporation. Since the Federal Deposit Insurance Company (FDIC) had not yet been created, the purpose of the confederation was to provide mutual financial support during difficult economic times. Although there was a great deal of speculation going on during this time in Wall Street brokerage houses, most banks throughout the country remained financially conservative and extremely cautious about using their assets for anything except the most stable investments.

Despite their fiscal conservatism, a number of banks were forced to close their doors during the 1920s. With the stock market crash of October 1929 and the onset of the Great Depression, conditions for the banking industry grew harsher and harsher. Many banks were forced to close during the years between 1929 and 1932. As the depression grew worse during the first few months of Franklin Roosevelt's presidency, he decided in early 1933 to close all the nation's banks for ten days. The purpose of this dramatic decision was to make certain that only those banks with stable financial ledgers would be permitted to reopen their doors to the public. When the ten-day period was over, all First Bank Stock Investment Corporation subsidiaries were allowed by the federal government to reopen without any mandated reorganization. The conservative policies adhered to by First Bank management were so sound, in fact, that the holding company was able to start an acquisitions campaign that lasted through much of the 1930s.

During the 1940s, banks that belonged to the First Bank confederation largely operated independently of one another. Managers at the individual banks were fiercely loyal to their own self-interests, and never hesitated to engage in extensive price cuts if they thought it might take a profitable customer away from another bank within the confederation. In fact, the competition among confederation banks was most intense in the Twin Cities of Minneapolis and St. Paul, Minnesota, where the largest individual banks in the First Bank system fought one another for customers. One cause of this counterproductive competition among the banks was the restrictive and antiquated branching legislation in Minnesota and other states in the region.

In 1954, the Bank Holding Company Act was passed by the U.S. Congress. This legislation gave the First Bank confederation and other bank holding companies throughout the nation the approval for already existing multi-state banking operations. Banks within the First Bank confederation were spread across a four-state area during this time, including Montana, South Dakota, North Dakota, and Minnesota. For the remainder of the 1950s, and throughout the decade of the 1960s, the banks of the confederation expanded their presence in these states by engaging in an aggressive acquisitions policy. By the 1970s, however, member banks of the confederation were operating so independently of one another that there was not only a lack of uniformity in services, but an overall lack of direction and centralized decision making.

During the late 1970s and early 1980s, the economy in the United States went into a tailspin, and the First Bank confederation was faced with the challenges of high inflation, uncertain interest rates, and growing competition from nonbank financial service companies. Confederation management recognized the need for more centralized control and in 1982 began to prepare a comprehensive strategy for this purpose. In 1985, First Bank management made its first significant decision by selling 28 smaller, rural banks with little prospect for future growth. This decision resulted in the sale of 45 offices over a four-state region. Another major decision involved the 1988 merger of the large Minneapolis and St. Paul banks, and additional suburban banks in the Twin Cities area, into First Bank National Association. The increase in operational efficiency and reduction in service costs provided the bank with a greater opportunity to compete effectively in the entire Twin Cities metropolitan area. Management at First Bank also purchased banks in the states of Washington and Colorado during this time, taking advantage of recent federal legislation that weakened many barriers to national banking.

More than the recession of the early 1980s led First Bank to reassess the adequacy and effectiveness of a loose confederation and hands-off management style. The farm crisis of the early to mid-1980s created credit quality problems for the regional banks affiliated with First Bank which were outside of the greater Twin Cities metropolitan area. Under the bank's own credit examination, its credit losses amounted to $424 million by 1986. This loss was compensated for by the $397 million in realized gains when the investment securities were sold. Yet when rising interest rates led to a substantial unrealized loss estimated at $640 million in the long-term bonds which had been bought to replace the securities recently sold, the company decided upon a hedging strategy to minimize the loss. Unfortunately, the hedging strategy failed, and the bonds were finally sold at a pre-tax loss of $506 million in 1988.

First Bank's emphasis on merchant banking, capital markets, and lending specializations proved disastrous during the mid-1980s. With decreasing capital levels resulting from the securities and bond losses, rising noninterest costs, an increasing amount of nonperforming assets, and weakening profitability, the company announced a comprehensive reorganization strategy in late 1989. The strategy included a withdrawal from merchant banking and lending specializations and a concentration on more basic banking services, such as merchant processing, credit cards, automated teller machines, and cash management. The company also began to capitalize upon and extend its geographic franchise. In 1989, First Bank recorded a restructuring expense of $37.5 million, while also reporting a $175 million provision for credit losses.

After a four-month search, in January 1990 the First Bank board of directors hired John F. (Jack) Grundhofer to act as chairman, president, and chief executive officer. Grundhofer, a former vice-chairman and senior executive officer at Wells Fargo, immediately initiated a massive cost-cutting strategy designed to bring the bank back to profitability. Grundhofer and his hand-chosen management team examined each line of the bank's business to determine whether or not it could remain competitive in the market. Grundhofer's first move was to stop lending to large corporations and concentrate more on retail banking, trusts and investments, and small and middle-range businesses. As a result, First Bank's portfolio of loans was drastically reduced. All the bank's national lending programs and its indirect auto loan programs were entirely eliminated, thus allowing the company to concentrate on expanding its regional commercial lending program and its direct consumer loan program. In general, First Bank's loan portfolio was gradually restructured to emphasize a larger number and more diverse mix of consumer loans.

The most important move that Grundhofer made, however, was to commit $150 million in First Bank funds to a cost-cutting technology program. When he arrived on the scene in the beginning of 1990, Grundhofer discovered that First Bank was mired in 1950s and 1960s technology. Over 45 banks under First Bank's umbrella had 47 different data processing centers, 715 different kinds of basic consumer deposit accounts, 16 loan processing centers, eight consumer loan centers, and 20 item processing centers. The bank also was without any centralized pricing structure for its products or services, and each bank within the system offered various kinds of products and services. The company's installment loan system was initially brought in during 1959 and was still in use. First Bank's customer information system dated back to 1964, without the benefit of any update since that time. In addition, its online savings system was more than 20 years old.

Within two years Grundhofer consolidated the bank's 47 data processing centers into one, and drastically reduced or eliminated all the other loan and processing centers. He implemented a fixed price structure for the bank's products and services, and standardized the products and services each of the banks offered within the First Bank system. As First Bank's efficiency ratio improved, more customers were attracted to the services provided by the bank. By 1992, a customer could walk into any of First Bank's affiliates in the Twin Cities area and get a cashier's check or automobile loan within ten minutes. The bank also developed an extremely useful and very popular 48-hour turnaround on small business loans for a $250,000 loan, the customer was asked to fill out a brief two-page application. Other processing capabilities that were improved by the bank's emphasis on technological development included a customer's ability to access account information from a remote site. Finally, all of the bank's numerous customer service phone centers were consolidated into two locations.

When the cost-cutting technology program began to show financial rewards, Grundhofer decided to increase First Bank's asset base through an aggressive acquisitions program. First Bank purchased U.S. Bancorp's Oregon and Washington corporate trust operations in early 1993. Prior to this, it had purchased the California corporate trust subsidiary of Bankers Trust New York Corporation in 1992. The company acquired Colorado National Bank with over $3 billion in assets, and Boulevard Bancorp in Chicago with over $1.5 billion in assets. Perhaps the most important acquisition involved the purchase of the domestic corporate trust of J.P. Morgan & Company, one of the largest and most prestigious banks in the United States. In May 1994, the company confirmed its acquisition of Metropolitan Financial Corporation for approximately $800 million. Metropolitan Financial, a Minneapolis, Minnesota-based bank with $5.7 billion in assets, operated a multi-state banking office network located in Minnesota, North Dakota, Iowa, Nebraska, Kansas, and Wyoming. The purchase of Metropolitan helped push First Bank's assets to $34.5 billion, ahead of the assets at First Fidelity Bancorp, the nation's 25th largest bank holding company.

In 1990 and 1991, the bank's capital restoration program involved a private placement of new common stock, which raised some $145 million from an investment partnership headed by Lazard Freres, and $30 million from the State Board of Administration of Florida. The bank also initiated a public offering of $114.5 million of preferred stock. These moves placed First Bank's capital ratio in the top percentile of regional banks in the United States.

Under Grundhofer's leadership, by the beginning of 1995 First Bank had grown into one of the largest and most successful of the regional banks. With its financial condition clearly improved, First Bank began to develop a community initiatives program that became a model for regional banks. First Bank's extensive community outreach program involved volunteerism, youth-employment projects, event sponsorships, and grants to nonprofit organizations. The company offered a comprehensive line of mortgage products and services to help low and moderate income families purchase their own homes. The bank also tailored loans for people with disabilities, provided customer assistance for non-English speaking peoples, and offered free accounts and services to individuals with low-income jobs. First Bank also extended credit to small businesses that fostered community development and rehabilitation by working closely with the Small Business Administration.

First Bank continued to focus its efforts on growth through acquisitions, and in March 1995 the company completed its acquisition of holding company First Western Corporation, which owned Western Bank in Sioux Falls, South Dakota. The sale included Western Bank's 12 branches in South Dakota. Also that year First Bank bought Southwest Bank, First Bank of Omaha, and FirsTier Financial Inc., greatly furthering its presence in Nebraska. The acquisitions made First Bank the largest banking firm in Nebraska, with a leading market share in Lincoln and the number two spot in Omaha. The FirsTier purchase was the largest bank acquisition in Nebraska history. Continuing with its flurry of acquisitions in 1995, First Bank bought the corporate trust operations of BankAmerica Corporation, making First Bank the nation's largest corporate trust company in terms of revenues. The following year First Bank added to its corporate trust operations by purchasing the municipal and corporate bond trustee division of Comerica Inc., a banking company based in Detroit.

Though acquisitions were a primary concern of First Bank, the company also focused on streamlining operations. The company's trust and investment division implemented a cost-cutting plan, which included personnel cuts and technology enhancements, to decrease expenses and boost revenues. First Bank also made the decision to depart the mortgage banking industry by selling its FBS Mortgage and Colorado National Mortgage operations. The bank planned to continue offering mortgage loans through its bank branches.

In the mid-1990s First Bank also spent a great deal of time, money, and energy in its attempt to acquire First Interstate Bancorp. First Bank lost out to Wells Fargo & Co., which had made several hostile takeover bids for First Interstate before succeeding. The battle was the largest hostile takeover attempt in the history of U.S. banking and, while it left First Bank without the First Interstate empire, the company gained a $200 million termination fee. First Bank hoped to use these funds to finance a significant acquisition, one that would enhance its operations and make it a strong contender in the rapidly consolidating and highly competitive U.S. banking industry.

U.S. Bancorp was organized as a holding company by the United States Bank of Oregon in the late 1960s, a time when many large banks across the country acknowledged and fostered their transformation into diversified financial services organizations by forming bank holding companies. The company's historical roots, however, stretch back nearly a century before the descriptive phrase 'diversified financial services organizations' became part of banking nomenclature, reaching back into the late 19th century to a simpler age when the business of banking comprised the rudimentary tasks of receiving deposits, cashing checks, and extending and collecting loans. Banking would develop into a much more sophisticated business by the time U.S. Bancorp first emerged in the late 1960s, but the company's true origins stemmed from the efforts of a handful of wealthy and influential businessmen during the early 1890s and their organization of The United States National Bank of Portland.

From out of the uncharted Portland wilderness, Oregon developed into a bustling commercial and industrial hub during the 19th century, its growth propelled by successive waves of settlers into the Pacific Northwest and the subsequent establishment of a spectrum of businesses and industries. As the community evolved from a secluded settlement into a burgeoning town and finally into one of the principal cities underpinning the Pacific Northwest's economy, banks were there to promote and support its growth, serving as a crucial source of capital in a region far removed from the established financial centers in the eastern United States. Starting in 1859, when the first national bank in Portland, the Ladd and Tilton, was organized, Portland's business operators began to utilize bank loans to develop their enterprises. As the town grew, requiring more and more capital to fund its development, the number of banks increased, totaling five in the state of Oregon by 1872, then jumping to 16 by 1880. Roughly a decade later, when more than 40 national banks were operating in Oregon, United States National Bank of Portland (U.S. National) was organized by nine businessmen.

Led by Donald MacLeay, an immigrant from Scotland who made his fortune in the grocery and shipping business, and George Washington Ewing Griffith, a wealthy Kansas businessman, the founding directors, all of whom were born outside of Oregon, organized U.S. National on February 5, 1891, then opened the bank four days later in rented offices in downtown Portland. Although U.S. National operated without a vault during its inaugural year, the apparent lack of security did not dissuade customers from bringing their banking business to the city's newest bank. During the bank's first day 15 customers opened new accounts, depositing a total of $21,886.30. By the end of its first year, fledgling U.S. National had become a thriving enterprise, holding $450,000 in deposits and capital stock and administering more than $350,000 in loans. It was an encouraging start for U.S. National, but before there was much chance for celebration, economic conditions in Oregon and throughout the nation soured, providing the bank with its first great test of resiliency while still in its infancy.

In 1893, two years after U.S. National began operating, a severe economic depression gripped the country, devastating more than 500 of the nation's banks and more than 16,000 businesses by the end of the year. Among the victims of the harsh economic conditions were a number of stable and respected Portland banks, but despite its status as a neophyte in the area's banking community U.S. National beat back the debilitating effects of the economic downturn. The bank's deposits slipped from a high of more than $400,000 in 1892 to less than $340,000 in 1896, but when the discovery of gold in the late 1890s swept away any lingering effects of the economic depression in the Pacific Northwest, U.S. National emerged stronger than ever before. For this strength the bank was indebted to the financial malaise of the early and mid-1890s, a deleterious period for many banks that left U.S. National occupying a more powerful position. Of Oregon's 41 national banks operating in 1892, only 27 remained after the depression, creating a more consolidated banking industry that buoyed U.S. National's position considerably. Of these 27 national banks, only four would survive to compete during the 20th century: Ainsworth National, Merchants National, First National, and the upstart U.S. National.

Less than a decade old in 1900, U.S. National had already passed Ainsworth National in volume of business to rank as the third largest bank and was gaining ground on Merchants National to secure the industry's second position. Growth would come quickly during the first decades of the new century as bankers recouped their losses from the 1890s and shared in the prosperity of the times. During the first decade of the century, the number of national banks in Oregon increased from 27 to 75, and deposits quadrupled as the city of Portland, with 200,000 residents by 1910, flourished economically. As one of the city's stalwart banks, U.S. National benefited greatly from the more robust economic conditions and was able to conclude several pivotal transactions that secured its inclusion among the region's leading banks. In 1902 U.S. National and Ainsworth National, the fourth largest bank, agreed to merge, creating a banking entity that kept the U.S. National corporate title and controlled resources valued at more than $2 million. Three years later U.S. National merged with Wells Fargo Company's Portland bank as growth and prosperity reigned, then in 1917 the bank merged with another large Portland bank, Lumbermens National. The merger with Lumbermens National increased U.S. National's deposits by $6.5 million and made it the second largest bank in the Pacific Northwest.

By the beginning of the 1920s U.S. National had deposits of more than $36 million, having grown considerably during its first 30 years of operation. In 1925 the bank set the tone for the magnitude of growth ahead when it merged with the venerable Ladd and Tilton. Aside from being the region's oldest bank, Ladd and Tilton represented a potent banking competitor with more than $20 million in deposits and 30,000 depositors. Once Ladd and Tilton was merged into U.S. National, U.S. National received a substantial boost to its stature, becoming the largest bank north of San Francisco and west of Minneapolis, with resources totaling $64.6 million, deposits reaching $60 million, and a large base of 75,000 depositors.

The 1920s were heady years for U.S. National, but as the events of the next decade unfolded, the bank faced economic conditions far more menacing than those surmounted during the 1890s. During the Great Depression more than half of the country's banks were financially ruined, thousands of businesses were devastated, and the ranks of the unemployed swelled beyond precedent. Like the economic depression touched off in 1893, however, U.S. National withstood the pernicious effects of financial collapse all around it, although deposits once again shrank during the period. Deposits reached a high of $71 million in September 1931, then over the next eight months fell by $10 million however, by the late 1930s business began to recover and the bank's deposits eclipsed $100 million. Perhaps the most important occurrence during the otherwise crippling 1930s was the enactment of legislation enabling banks to establish branches, which U.S. National began doing in 1933 and would continue to do thereafter.

During the 1940s U.S. National expanded its presence geographically by acquiring existing banks and converting them to U.S. National branches, such as the bank's 1940 purchase of the Medford National Bank, First National of Corvallis, and the Ladd and Bush Bank of Salem. Although the number of banking units comprising U.S. National's growing branch network rose only modestly during World War II, climbing from 26 to 29, deposits nearly tripled during the war years, leaping to $581 million by the end of 1945. Following the war, when an era of widespread prosperity gave large segments of the American population substantially more disposable income than ever before, the national banking industry underwent a dramatic shift as banks across the country began focusing on the consumer with concerted intensity. Loans for consumer purchases proliferated, and U.S. National responded by augmenting its consumer credit department with a branch consumer credit department in 1949. Bank advertising during the era reflected the significant shift in focus, as advertisements began to emphasize the availability of loans for individuals and the use of bank credit, rather than encouraging thrift as they had done since U.S. National's inception.

Between 1945 and 1955, 35 banking units were added to U.S. National's branch system, the bulk of which--29--were acquired through mergers and acquisitions as the bank swallowed smaller competitors and outpaced larger competitors with its aggressive expansion across the state of Oregon. Aside from ranking as one of the larger state banks in the nation, U.S. National also began to distinguish itself as an industry pioneer during the 1950s by offering such innovative services as drive-up banking, erecting the first motor banking facility in Oregon in 1956, and leading the way with a computerized system to post checks in 1957.

In contrast to the 1950s, U.S. National expanded its branch network through internal means during the 1960s, creating new banking facilities rather than absorbing existing banking units through mergers or acquisitions. By 1965 the bank operated 100 branches across the state, a considerable presence that the bank's directors had acknowledged the previous year by changing the bank's name from United States National Bank of Portland to United States National Bank of Oregon. Other, more significant changes were in the offing as the bank entered the late 1960s and began to formulate a plan for the future, in search of a way to contend with the mounting pressures affecting banks during the period.

The business of banking had become a complex and highly competitive endeavor by the 1960s, substantially more sophisticated than when U.S. National first opened its doors in 1891. In addition to a much broader range of financial services offered by commercial banks, the market for these services had become more competitive since World War II. Between 1945 and 1960, savings in commercial banks such as U.S. National had doubled, whereas the amount in savings and loan associations had sextupled and the amount in credit unions had increased an enormous tenfold, absorbing business that would traditionally have gone to commercial banks.

In response, commercial banks began to form one-bank holding companies during the late 1960s, enabling them to acquire and organize other subsidiaries that could legally offer a broader range of services. In so doing, banks hoped to beat back the competition and keep noncommercial banks from entering into financial activities that historically had been under the exclusive purview of commercial banks. On September 9, 1968, U.S. National followed the nationwide trend by forming U.S. Bancorp as a one-bank holding company, heralding the development of a vast financial services network and the extension of U.S. Bancorp beyond Oregon's borders.

Once able to delve into new businesses, U.S. Bancorp did so with fervor, organizing a host of financial services subsidiaries during the 1970s: Bancorp Leasing, Inc., which was organized to enhance service to business customers through lease financing U.S. Bancorp Financial, Inc., a subsidiary formed to specialize in asset-based commercial financing and Mount Hood Credit Life Insurance Agency, which was created to centralize and streamline credit-related insurance activities throughout the U.S. National system. Numerous other subsidiaries were formed in the wake of U.S. Bancorp's founding, transforming the U.S. National-U.S. Bancorp network into a genuine regional financial services organization.

By the beginning of the 1980s, U.S. Bancorp was well on its way to becoming one of the preeminent regional financial services organizations in the country. Decidedly acquisitive throughout the 1980s, the holding company started the decade by establishing The Bank of Milwaukee, a state-chartered bank, in 1980, making U.S. Bancorp a multi-bank holding company. During the year, the company also acquired State Finance and Thrift Company of Logan, Utah, and established Citizen's Industrial Bank in Littleton, Colorado, further bolstering its out-of-state presence in regions where U.S. National was not allowed to operate. By the end of the year U.S. Bancorp's territory included California, Texas, Washington, Utah, Idaho, Colorado, Montana, and its home state of Oregon, giving the company ample room to grow as the decade progressed.

With the acquisition of Spokane-based Old National Bancorp and Seattle-based Peoples Bancorp in 1987, U.S. Bancorp became the largest bank holding company based in the Northwest. During the late 1980s, the company continued to aggressively pursue smaller rival banks, hoping to achieve a dominant position in markets opened up earlier in the decade. Other large banking organizations followed a similar strategy, creating a nationwide trend toward consolidation that left U.S. Bancorp as the last major independent bank in the Pacific Northwest by the early 1990s. With $19 billion in assets in 1992, the company ranked as the 32nd largest bank in the United States.

During the next two years, U.S. Bancorp's management began to focus its efforts on achieving greater efficiency by streamlining the company's operations and eliminating nearly a quarter of its workforce through layoffs and the divestiture of noncore subsidiaries. After two years of implementing severe downsizing measures, the company announced a momentous acquisition in 1995 that added substantially to U.S. Bancorp's already sizable holdings. Intent on strengthening its position in Idaho, where the company maintained only a token presence, U.S. Bancorp officials announced the $1.6 billion acquisition of West One Bancorp of Idaho in May, which the shareholders of both banking organizations agreed to in October. Completed at the end of 1995, the deal made U.S. Bancorp one of the 30 largest banking organizations in the country, with $30 billion in assets and $21 billion in deposits.

Buoyed by its purchase of West One, U.S. Bancorp continued its quest for growth in 1996. In an age of industry consolidation, U.S. Bancorp hoped to expand and grow to stave off takeover attempts, and acquisitions proved an optimal way to grow quickly. The company bought Northern California-based California Bancshares Inc. for about $327 million, boosting its presence there from 57 branches to 93 and expanding its area of operations from 22 counties to 27. In December 1996 U.S. Bancorp grew its presence in northern California further with the acquisition of Sacramento-based Business & Professional Bank. The small bank had four offices in the Sacramento region. U.S. Bancorp picked up another small bank with the purchase of Sun Capital Bancorp of Utah. The fast-growing Sun Capital had three branches in St. George, in the southern portion of Utah. U.S. Bancorp also hoped to capitalize on the growth of in-store banking and made plans to open about 200 supermarket branches from 1996 to 2000. The company inked a deal with Albertson's Inc. to provide exclusive banking services to about 170 Albertson's stores in Oregon, Washington, Idaho, and Nevada.

Though U.S. Bancorp continued to strengthen operations and grow, industry analysts believed the bank was not immune to takeover attempts. U.S. Bancorp's strategy of acquiring small companies, some analysts felt, was insufficient and would not protect the bank from larger adversaries. In addition, small to mid-sized banks were growing more scarce, leaving U.S. Bancorp with few potential acquisitions, and competition was growing. The bank ran into a small obstacle when its attempt to buy 61 branches in California from Wells Fargo & Co. in 1996 failed. Still, U.S. Bancorp remained confident and hopeful that it would be able to continue functioning independently.

First Bank System Acquires U.S. Bancorp: Late 1990s

In early 1997 First Bank System announced it would acquire U.S. Bancorp for about $8.8 billion, extending First Bank's reach to the Pacific Ocean. The deal, which was one of the largest in U.S. banking history, nearly doubled First Bank's asset size and created a mega-bank serving about 17 states in the Midwest and West. The merged entity took the name U.S. Bancorp, with headquarters remaining in Minneapolis. First Bank's Grundhofer served as president and CEO, while U.S. Bancorp's Gerry Cameron continued as chairman until his retirement in 1998. According to the Star-Tribune, Grundhofer commented on the merger at a press conference and said, 'Our regions are contiguous, compatible and are in attractive growth markets. Our banks both have strong market presence. Our business strategies are virtually identical.'

As part of the consolidation efforts, nearly 4,000 staff members were laid off, the bulk of them from among U.S. Bancorp's 14,000 workers, including about 2,000 positions in the Portland region. Loan servicing operations in Portland were moved to Minneapolis, and credit card processing operations were moved to Fargo, North Dakota, where First Bank's credit card division was based.

In late 1997 the new U.S. Bancorp announced it would buy Minneapolis-based Piper Jaffray Companies Inc. for about $730 million. The acquisition greatly enhanced U.S. Bancorp's ability to provide investment banking and securities brokerage services to customers and created the 11th largest brokerage in the nation. U.S. Bancorp continued to grow in 1998 and bought Northwest National Bank, a small, family-owned bank in Vancouver, Washington, near Portland, Oregon. In the summer of 1998 U.S. Bancorp gained an exclusive contract to provide the Department of Defense with purchasing cards and electronic commerce systems. The bank beat out several competitors to gain the lucrative contract.

In 1999 U.S. Bancorp exited the retail banking scene in Kansas when it sold its 20 branches to INTRUST Bank of Wichita, Kansas' largest bank. The company also sold eight branches in Iowa. Though U.S. Bancorp left Kansas, it strove to increase its presence in southern California in 1999 by acquiring several banks. The bank purchased Bank of Commerce, based in San Diego, for $314 million in stock. Bank of Commerce operated ten branches. U.S. Bancorp also bought Western Bancorp of Newport Beach for about $958 million in stock. Western Bancorp operated Santa Monica Bank and Southern California Bank and had 31 branches. The bank was known for its commercial lending operations. In the fall of 1999 U.S. Bancorp announced it would buy Peninsula Bank of San Diego for about $104 million in stock. Prior to the three acquisitions, U.S. Bancorp had 88 branches in southern California.

U.S. Bancorp grew its U.S. Bancorp Piper Jaffray division with the acquisition of Libra Investments, Inc., in early 1999 and the investment banking operations of John Nuveen Co. in September. The following year the company bought specialty leasing company Oliver-Allen Corporation. Also in 2000 the bank continued its acquisition streak in southern California when it purchased Scripps Financial Corp. of San Diego. The buy included nine branches of Scripps Bank, primarily a commercial bank.

Though U.S. Bancorp appeared to be on the fast track of growth in the late 1990s, its consumer banking operations, which accounted for about one-third of U.S. Bancorp's earnings, struggled, and retail revenue grew a mere four percent in 1999. U.S Bancorp's 1999 net income was $1.51 billion, up from 1998 net income of $1.33 billion, but the company failed to meet its growth goals. To stoke up its consumer banking division, U.S. Bancorp hired hundreds of new branch tellers, customer service representatives for its telephone operations, and small business bankers. The bank also added new electronic banking services and began to overhaul more than 1,000 branches. Still, the company's stock continued to sag, and during the first half of 2000 its stock price fell 11 percent. U.S. Bancorp's Grundhofer remained optimistic and confident about the bank's future, stating in his letter to shareholders in the company's 1999 annual report that U.S. Bancorp hoped to meet its growth goal of 12 to 15 percent by the end of 2001.

Principal Subsidiaries: U.S. Bank National Association U.S. Bank National Association MT U.S. Bank National Association ND U.S. Bank National Association OR U.S. Bank Trust Company, National Association U.S. Bank Trust National Association U.S. Bank Trust National Association MT U.S. Bancorp Investments, Inc. FBS Capital I U.S. Bancorp Venture Capital Corporation U.S. Bancorp Community Development Corporation U.S. Bancorp Information Services, Inc. U.S. Bancorp Equity Capital, Inc. USB Trade Services Limited U.S. Trade Services, Inc. U.S. Bancorp Capital I U.S. Bancorp Piper Jaffray Companies Inc. First Building Corporation First Group Royalties, Inc. First System Services, Inc. U.S. Bancorp Card Services, Inc. U.S. Bancorp Insurance Services, Inc.

Principal Competitors: Citigroup Inc. Wells Fargo & Company KeyCorp.

Anderson, Michael A., 'U.S. Bancorp's Interstate Bid Begins Anew,' Business Journal-Portland, May 19, 1986, p. 1.
Bennett, Robert A., 'Roger Faces Goliath,' United States Banker, June 1992, p. 20.
Condon, Bernard, 'Brother, Can You Spare a Bank?', Forbes, April 3, 2000.
Crockett, Barton, 'U.S. Bancorp to Ax 52 Branches After Merger,' American Banker, October 27, 1995, p. 4.
DePass, Dee, 'FBS Reaches West,' Star-Tribune Newspaper of the Twin Cities Minneapolis-St.Paul, March 21, 1997, p. D1.
Fitch, Mike, 'Mother Lode's Buyer Got Good Deal, Say Observers,' Puget Sound Business Journal, November 6, 1989, p. 22.
Heind, John, 'Buy or Be Bought,' Forbes, May 18, 1987, p. 48.
Jaffe, Thomas, 'Cheap Bank,' Forbes, June 29, 1987, p. 122.
Jordon, Steve, 'First Bank Is Poised to Grow in Nebraska,' Omaha World-Herald, June 9, 1995, p. 14.
------, 'U.S. Bancorp Chairman Is Building for Long Haul,' Omaha World-Herald, June 21, 2000, p. 18.
Kapiloff, Howard, 'Fourth-of-July Merger Fireworks,' American Banker, July 5, 1994, p. 1.
Klinkerman, Steve, and Karen Gullo, 'First Bank System to Purchase Morgan's Corporate Trust Unit,' American Banker, January 5, 1993, p. 5.
Manning, Jeff, 'Bankruptcies May Be Lever for U.S. Bank,' Business Journal-Portland, December 9, 1991, p. 1.
Milligan, John W., 'Making First Bank Work,' US Banker, March 1, 1997, p. 32.
Ota, Alan K., 'First Bank Begins to Issue Pink Slips at U.S. Bancorp,' Portland Oregonian, June 4, 1997, p. C1.
------, 'U.S. Bancorp: Hunter or Prey?', Portland Oregonian, September 12, 1996, p. B1.
------, 'U.S. Bancorp on Guard Duty,' Portland Oregonian, May 8, 1996, p. B1.
Ota, Alan K., and Steve Woodward, 'First Bank Wooed U.S. Bank in Polite but Insistent Romance,' Portland Oregonian, March 26, 1997.
'Purchase by U.S. Bancorp to Create Northwest Giant,' New York Times, May 9, 1995, p. D2.
Rhoads, Christopher, 'First Bank System Buying U.S. Bancorp Pricey $8.4B Deal Is Banking Industry's Fourth Largest Ever,' American Banker, March 21, 1997, p. 1.
'Shareholders Approve Merger of U.S. Bancorp & West One, Bancorp,' PR Newswire, October 3, 1995, p. 1.
Silvestri, Scott, and Laura Mandaro, 'U.S. Bancorp CEO Talks Like a Buyer,' American Banker, June 19, 2000, p. 1.
Talley, Karen, 'U.S. Bancorp's Piper Deal an Integration Success,' American Banker, November 10, 1999, p. 1.
Taylor, John H., 'No Chest-Beater,' Forbes, May 11, 1992, p. 172.
'U.S. Bancorp Will Acquire Piper Jaffray,' Portland Oregonian, December 16, 1997, p. B1.
Zack, Jeffrey, 'Technology Gives First Bank's Grundhofer a Cost-Cutting Edge,' American Banker, May 9, 1994, p. 1.
Zimmerman, Rachel, 'Branch Closures Likely in U.S. Bank-West One Deal,' Puget Sound Business Journal, August 25, 1995, p. 7.

Source: International Directory of Company Histories , Vol. 36. St. James Press, 2001.


Bank of New York Edit

The first bank in the U.S. was the Bank of North America in Philadelphia, which was chartered by the Continental Congress in 1781 Alexander Hamilton, Thomas Jefferson and Benjamin Franklin were among its founding shareholders. [7] In February 1784, The Massachusetts Bank in Boston was chartered. [7]

The shipping industry in New York City chafed under the lack of a bank, and investors envied the 14% dividends that Bank of North America paid, and months of local discussion culminated in a June 1784 meeting at a coffee house on St. George's Square which led to the formation of the Bank of New York company it operated without a charter for seven years. The initial plan was to capitalize the company with $750,000, a third in cash and the rest in mortgages, but after this was disputed the first offering was to capitalize it with $500,000 in gold or silver. When the bank opened on June 9, 1784, the full $500,000 had not been raised 723 shares had been sold, held by 192 people. Aaron Burr had three of them, and Hamilton had one and a half shares. The first president was Alexander McDougall and the Cashier was William Seton. [8] [9] [10] [11]

Its first offices were in the old Walton Mansion in New York City. [2] [8] [9] In 1787, it moved to a site on Hanover Square that the New York Cotton Exchange later moved into. [8]

The bank provided the United States government its first loan in 1789. The loan was orchestrated by Hamilton, then Secretary of the Treasury, and it paid the salaries of United States Congress members and President George Washington. [12]

The Bank of New York was the first company to be traded on the New York Stock Exchange when it first opened in 1792. [13] In 1796, the bank moved to a location at the corner of Wall Street and William Street, which would later become 48 Wall Street. [8] [14]

The bank had a monopoly on banking services in the city until the Bank of the Manhattan Company was founded by Aaron Burr in 1799 the Bank of New York and Hamilton vigorously opposed its founding. [8]

During the 1800s, the bank was known for its conservative lending practices that allowed it to weather financial crises. It was involved in the funding of the Morris and Erie canals, and steamboat companies. [15] [16] The bank helped finance both the War of 1812 and the Union Army during the American Civil War. [17] [18] Following the Civil War, the bank loaned money to many major infrastructure projects, including utilities, railroads, and the New York City Subway. [15]

Through the early 1900s, the Bank of New York continued to expand and prosper. [16] [18] In July 1922, the bank merged with the New York Life Insurance and Trust Company. [19] The bank continued to profit and pay dividends throughout the Great Depression, and its total deposits increased during the decade. [16] [18] In 1948, the Bank again merged, this time with the Fifth Avenue Bank, which was followed by a merger in 1966 with the Empire Trust Company. [15] [18] The bank's holding company was created in 1969. [15]

In 1988, the Bank of New York merged with Irving Bank Corporation after a year-long hostile take over bid by Bank of New York. [20] Irving had been headquartered at 1 Wall Street and after the merger, this became the headquarters of the Bank of New York. [21] In 1922, Irving Trust opened an account with Vnesheconombank, now known as VEB, and beginning on October 7, 1988, when the merger was approved, the Bank of New York was able to conduct transactions with the Soviet Union and later in 1991 Russia. [22] Natasha Kagalovsky (née Gurfinkel) with the pseudonym Gurova, who had been an employee at Irving Trust since 1986 and was in charge of the banking with the Soviet Union, became a senior vice president at the Bank of New York heading the Eastern European operations from 1992 until October 13, 1999, when she resigned. [23] [24] [25] [26] [27] [a]

From 1993 to 1998, the bank made 33 acquisitions, including acquiring JP Morgan's Global Custody Business in 1995. [18] Ivy Asset Management was acquired in 2000, and the bank acquired Pershing LLC, the United States' second-largest trade clearinghouse, in 2003. [18] [29]

In the 1990s, Vladimir Kirillovich Golitsyn or "Mickey" Galitzine (Russian: Владимир Кириллович Голицын 1942-2018, born Belgrade) with the pseudonym Vladimirov, whose father was a director of the Tolstoy Foundation, established and headed the Eastern European Department at the Bank of New York until 1992 and hired many Russians. He mentored many new bankers in Hungary, the former East Germany, Poland, Romania, and Bulgaria and travelled extensively to capital cities in the former Soviet Union or the CIS to assist new bankers especially in Russia to where he travelled for his first time in 1990, Ukraine, Latvia, Georgia, Armenia, Turkmenistan, and Kazakhstan. In 1960, he joined the Bank of New York and worked as an accountant in its International Department but later headed the Russia team as a vice president of the bank. His wife Tatiana Vladimirovna Kazimirova (Russian: Татьяна Владимировна Казимирова b. 1943, Berlin), an employee at the Bank of New York whom he married in 1963, worked very closely with him. He traveled for his first time to Russia in 1990. He worked closely with banks in Greece, Malta, and Italy and was an expert in cotton, gold, silver, and other raw materials financing. [23] [27] [30] [31] [32]

Bank of New York had correspondent accounts for several Russian banks including Inkombank (Russian: Инкомбанк ), Menatep (Russian: «Менатеп» ), Tokobank (Russian: Токобанк ), Tveruniversalbank (Russian: Тверьуниверсалбанк ), Alfa-Bank (Russian: Альфа-банк ), Sobinbank (Russian: Собинбанк ), Moscow International Bank (Russian: Московский международный банк ) and others. [33] [34]

In 2005, the bank settled a US federal investigation that began in 1996 concerning money laundering related to post-Soviet privatization in Russia. The illegal operation involved two Russian emigres, Peter Berlin and his wife Lyudmila "Lucy" (née Pritzker) Edwards who was a Vice President of the bank and worked at its London office, moving over US$7 billion via hundreds of wires. [25] [27] [35] [36] [37] [38] [39] Through accounts created by Peter Berlin for Alexei Volkov's Torfinex Corportion, Bees Lowland, which was an offshore shell company created by Peter Berlin, and Benex International Company Inc, numerous irregular wire transfers occurred at the Bank of New York. [27] In October 1997 at Bologna, Joseph Roisis, also spelled Yosif Aronovizh Roizis and nicknamed Cannibal as a member of Russian mafia's Solntsevskaya Bratva with businesses in Czechoslovakia, explained to Italian prosecutors that 90% of the money flowing through Benex accounts at the Bank of New York is Russian mafia money. [25] [28] [b] Alexei Volkov was charged in the United States but fled to Russia which has no extradition treaty with the United States and later the charges were dropped. [24] Svetlana Kudryavtsev, a Bank of New York employee that was responsible for the proper operation of the Benex accounts in New York which had ties to Semion Mogilevich and through which passed $4.2 billion from October 1998 to March 1999, refused to cooperate and resigned during an internal audit of the matter but was later indicted by the FBI for her role in which she received $500 a month from Edwards for her services. [41] [42] [43] [c] Alexander Mamut's Sobinbank, which since August 2010 is a subsidiary of Rossiya Bank, was raided on October 10, 1999, in support of United States investigations into money laundering at the Bank of New York. [47] Edmond Safra of the bank Republic New York, which is a longtime rival of the Bank of New York, alerted the FBI to the money laundering scheme which also involved Russian banks including Sobinbank and the Depozitarno-Kliringovy Bank or the Russian Deposit Clearinghouse Bank (Russian: российский «Депозитарно-клиринговый банк» («ДКБ») ) which was created by Peter Berlin and had the same address as the Bees Lowland offshore shell company. [25] [26] [48] $3 billion went from both Russian DKB and Sobinbank accounts through the Igor and Oleg Berezovsky owned Italian firm Prima based in Rimini and, through Andrei Marisov at the Grigory Luchansky associated French firm Kama Trade which had accounts with the Société bancaire arabe (SBA) to accounts at the Peter Berlin created Sinex Bank in Nauru. [25] [26] [49] [d] [e]

In 2006, the Bank of New York traded its retail banking and regional middle-market businesses for J.P. Morgan Chase's corporate trust assets. The deal signaled the bank's exit from retail banking. [56]

Mellon Financial Edit

Mellon Financial was founded as T. Mellon & Sons' Bank in Pittsburgh, Pennsylvania, in 1869 by retired judge Thomas Mellon and his sons Andrew W. Mellon and Richard B. Mellon. [57] The bank invested in and helped found numerous industrial firms in the late 1800s and early 1900s including Alcoa, Westinghouse, Gulf Oil, General Motors and Bethlehem Steel. [58] [59] Both Gulf Oil and Alcoa are, according to the financial media, considered to be T. Mellon & Sons' most successful financial investments. [58] [59]

In 1902, T. Mellon & Sons' name was changed to the Mellon National Bank. [58] The firm merged with the Union Trust Company, a business founded by Andrew Mellon, in 1946. The newly formed organization resulting from the merger was named the Mellon National Bank and Trust Company, and was Pittsburgh's first US$1 billion bank. [60]

The bank formed the first dedicated family office in the United States in 1971. [61] A reorganization in 1972 led to the bank's name changing to Mellon Bank, N.A. and the formation of a holding company, Mellon National Corporation. [57] [58]

Mellon Bank acquired multiple banks and financial institutions in Pennsylvania during the 1980s and 1990s. [62] In 1992, Mellon acquired 54 branch offices of Philadelphia Savings Fund Society, the first savings bank in the United States, founded in 1819. [63]

In 1993, Mellon acquired The Boston Company from American Express and AFCO Credit Corporation from The Continental Corporation. The following year, Mellon merged with the Dreyfus Corporation, bringing its mutual funds under its umbrella. [58] In 1999, Mellon Bank Corporation became Mellon Financial Corporation. Two years later, it exited the retail banking business by selling its assets and retail bank branches to Citizens Financial Group. [58]

Merger Edit

On December 4, 2006, the Bank of New York and Mellon Financial Corporation announced they would merge. [64] The merger created the world's largest securities servicing company and one of the largest asset management firms by combining Mellon's wealth-management business and the Bank of New York's asset-servicing and short-term-lending specialties. [2] [64] The companies anticipated saving about $700 million in costs and cutting around 3,900 jobs, mostly by attrition. [2]

The deal was valued at $16.5 billion and under its terms, the Bank of New York's shareholders received 0.9434 shares in the new company for each share of the Bank of New York that they owned, while Mellon Financial shareholders received 1 share in the new company for each Mellon share they owned. [17] The Bank of New York and Mellon Financial entered into mutual stock option agreements for 19.9 percent of the issuer's outstanding common stock. [64] The merger was finalized on July 1, 2007. [4] The company's principal office of business at the One Wall Street office previously held by the Bank of New York. [3] The full name of the company became The Bank of New York Mellon Corp., with the BNY Mellon brand name being used for most lines of business. [3] [4]

Post-merger history Edit

In October 2008, the U.S. Treasury named BNY Mellon the master custodian of the Troubled Asset Relief Program (TARP) bailout fund during the financial crisis of 2007 to 2010. BNY Mellon won the assignment, which included handling accounting and record-keeping for the program, through a bidding process. [65] In November 2008, the company announced that it would lay-off 1,800 employees, or 4 percent of its global workforce, due to the financial crisis. [66] According to the results of a February 2009 stress test conducted by federal regulators, BNY Mellon was one of only three banks that could withstand a worsening economic situation. [67] The company received $3 billion from TARP, which it paid back in full in June 2009, along with US$136 million to buy back warrants from the Treasury in August 2009. [68] [69]

In August 2009, BNY Mellon purchased Insight Investment, a management business for external funds, from Lloyds Banking Group. [70] [71] The company acquired PNC Financial Services' Global Investment Servicing Inc. in July 2010 and Talon Asset Management's wealth management business in 2011. [72] [73]

By 2013, the company's capital had steadily risen from the financial crisis. In the results of the Federal Reserve's Dodd-Frank stress test in 2013, the bank was least affected by hypothetical extreme economic scenarios among banks tested. [74] It was also a top performer on the same test in 2014. [75]

BNY Mellon began a marketing campaign in 2013 to increase awareness of the company that included a new slogan and logo. [76] [77]

In 2013, the bank started building a new IT system called NEXEN. [78] [79] NEXEN uses open source technology and includes components such as an API store, data analytics, and a cloud computing environment. [80] [81]

In May 2014, BNY Mellon sold its 1 Wall Street headquarters, [82] and in 2015, moved into leased space at Brookfield Place. [83] In June 2014, the company combined its global markets, global collateral services and prime services to create the new Markets Group, [84] also known as BNY Markets Mellon. [85] The company expanded its Hong Kong office in October 2014 as part of the company's plans to grow its wealth management business. [86]

Between 2014 and 2016, BNY Mellon opened innovation centers focused on emerging technologies, big data, digital and cloud-based projects, with the first opening in Silicon Valley. [87] [88] [89]

In September 2017, BNY Mellon announced that it agreed to sell CenterSquare Investment Management to its management team and the private equity firm Lovell Minnick Partners. The transaction is subject to standard regulatory approvals and is expected to be completed by the end of 2017. [90]

In January 2018, BNY Mellon announced that it was again moving its headquarters location, less than four years after its prior move. The headquarters location was announced as 240 Greenwich Street, a renaming of the already BNY Mellon-owned 101 Barclay Street office building in Tribeca, New York City. [91] [92] BNY Mellon had owned the office building for over 30 years, with control of the location obtained via 99-year ground lease. The same year, the company purchased the location from the city for $352 million. [93]

The following graphs represent the net income and assets and liabilities for the years 2000 to 2016 for the Bank of New York Mellon, the Bank of New York Mellon Corporation's New York state-chartered bank and an FDIC-insured depository institution.

Assets and Liabilities 2000–2016 [94] [95]

Assets/Liabilities Ratio (%) 2000–2016 [94] [95]

Net Income 2000–2016 (in millions) [94] [95]

BNY Mellon operates in 35 countries in the Americas, Europe, the Middle East and Africa (EMEA), and Asia-Pacific. [96] [97] The company employed 51,300 people as of December 2018. [1] In October 2015, the group's American and global headquarters relocated to 225 Liberty Street, as the former 1 Wall Street building was sold in 2014. [83] In July 2018, the company changed its headquarters again, this time to its existing 240 Greenwich Street location in New York (previously addressed 101 Barclay St). [98] The group's EMEA headquarters are located in London and its Asia-Pacific headquarters are located in Hong Kong. [99] [100]

Business Edit

The bank's primary functions are managing and servicing the investments of institutions and high-net-worth individuals. [13] Its two primary businesses are Investment Services and Investment Management, [101] which offer services for each stage of investment, from creation through to trading, holding, management, distribution and restructuring. [102] [103] The bank's clients include 80 percent of Fortune 500 companies. [104] The company also serves 77 percent of the top 100 endowments, 87 percent of the top 1,000 pension and employee benefit funds, 51 percent of the top 200 life and health insurance companies and 50 percent of the top 50 universities. [105]

Investment Services Edit

The bank's Investment Services business represents approximately 72 percent of the company's revenue [106] and it has $31.1 trillion under its custody or administration as of September 2016. [107] The financial services offered by the business include asset servicing, alternative investment services, broker-dealer services, corporate trust services and treasury services. [97] [101] Other offerings include global collateral services, foreign exchange, securities lending, middle and back office outsourcing, and depository receipts. [97] [101]

The company's subsidiary Pershing LLC handles securities services, including execution, settlement, and clearing. It also provides back office support to financial advisors. [108] [109]

In 2014, the company formed a new Markets Group, which offers collateral management, securities finance, foreign exchange and capital markets. [84] The group is now known as BNY Mellon Markets. [85]

Investment Management Edit

BNY Mellon's Investment Management business generates 28 percent of the company's revenue [106] and had US$1.7 trillion (Q4 2016) in assets under management. [110] [71] [111] It operates several asset management boutiques and as of 2014 was the largest multi-boutique investment manager in the world. [103] [112]

BNY Mellon's Wealth Management unit handles the private banking, estate planning, family office services, and investment servicing and management of high-net-worth individuals and families. [97] [113] As of 2014, it ranks 7th among wealth management businesses in the United States. Starting in 2013, the unit began expansion efforts, including opening eight new banking offices, increasing salespeople, bankers, and portfolio managers on staff, and launching an awareness campaign for wealth management services through television ads. [113]

Leadership Edit

Charles W. Scharf was appointed CEO in July 2017 and became Chairman after former CEO and Chairman Gerald Hassell retired at the end of 2017. [114] [115] Hassell had been Chairman and CEO since 2011, after serving as BNY Mellon's president from 2007 to 2012 [115] and as the president of the Bank of New York from 1998 until its merger. Scharf stepped down in 2019 to become the new CEO of Wells Fargo. Thomas "Todd" Gibbons took over as the new CEO in 2020. [116]

Karen Peetz served as president (the bank's first female president) from 2013 to 2016, when she retired the company did not appoint a new president when she retired. [117] [118] Thomas Gibbons served as CFO between 2008 and 2017, when he also serves as vice chairman. [119] In 2017, Gibbons was replaced as CFO by Michael P. Santomassimo. [120] [121] BNY Mellon's Investment Management business is run by CEO Mitchell Harris, [122] and the company's Investment Services business was led by Brian Shea [123] until his retirement in December 2017. [124]

As of July 2017, the company's board members were Linda Z. Cook, Nicholas M. Donofrio, Joseph J. Echevarria, Edward P. Garden, Jeffrey A. Goldstein, Gerald L. Hassell, John M. Hinshaw, Edmund F. (Ted) Kelly, John A. Luke Jr., Jennifer Morgan, Mark A. Nordenberg, Elizabeth E. Robinson, Charles W. Scharf and Samuel C. Scott III. [125]

Company culture Edit

In 2008, BNY Mellon formed a Board of Directors corporate social responsibility committee to set sustainability goals. [126] [127] The company's corporate social responsibility activities include philanthropy, social finance in the communities the bank is located in, and protecting financial markets globally. [128]

The bank's philanthropic activities include financial donations and volunteerism. [129] The company matches employee volunteer hours and donations with financial contributions through its Community Partnership program. [130] Between 2010 and 2012, the company and its employees donated approximately $100 million to charity. [129] In 2014, the company worked with the Forbes Fund to create a platform that connects nonprofit organizations with private businesses to solve social challenges. [131]

The company received a 100 A rating in 2013, 2014 and 2015 by the CDP, which measures corporate greenhouse gas emissions and disclosures. [127] [132] [133] BNY Mellon was named on the Dow Jones Sustainability North America Index in 2013, [134] 2014 and 2015, and the World Index in 2014, [135] 2015 [136] and 2016. [137] Another one of the company's focuses has been building efficiency. As of 2014, the company has saved $48 million due to building efficiency. Five of its buildings have achieved Leadership in Energy and Environmental Design (LEED-EB) certification and 23 have interiors that are LEED certified. [127]

The company has business resource groups for employees that are focused on diversity and inclusion. [128] [138] In 2009, Karen Peetz co-founded the BNY Mellon Women's Initiative Network (WIN), a resource group for female employees' professional development. [139] As of 2013, WIN had 50 chapters. [140] Other groups include PRISM for LGBT employees, IMPACT, which serves multicultural employees and HEART for employees with disabilities. [138] The bank has services for returning military, including a tool to help veterans align military skills and training with jobs at the company. [141] In 2014, it was recognized for its diversity practices by the National Business Inclusion Consortium, which named it Financial Services Diversity Corporation of the Year. [142]

In 2009, the company began an innovation program for employees to suggest ideas for large-scale projects and company improvement. Ideas from the initial pilot program generated approximately $165 million in pretax profit. The program results in an annual contest called "ACE" in which teams pitch their ideas. [143]

Foreign currency exchange issues Edit

In October 2011, the U.S. Justice Department and New York's attorney general filed civil lawsuits against the Bank of New York, alleging foreign currency fraud. The suits held that the bank deceived pension-fund clients by manipulating the prices assigned to them for foreign currency transactions. Allegedly, the bank selected the day's lowest rates for currency sales and highest rates for purchases, appropriating the difference as corporate profit. The scheme was said to have generated $2 billion for the bank, at the expense of millions of Americans' retirement funds, and to have transpired over more than a decade. Purportedly, the bank would offer secret pricing deals to clients who raised concerns, in order to avoid discovery. Bank of New York defended itself vigorously, maintaining the fraud accusations were "flat out wrong" and warning that as the bank employed 8,700 employees in New York, any damage to the bank would have negative repercussions for the state of New York. [144] [145]

Finally, in March 2015, the company admitted to facts concerning the misrepresentation of foreign exchange pricing and execution. BNY Mellon's alleged misconduct in this area includes representing pricing as best rates to its clients, when in fact they were providing clients with bad prices while retaining larger margins. In addition to dismissing key executives, the company agreed to pay a total of US$714 million to settle related lawsuits. [146]

In May 2015, BNY Mellon agreed to pay $180 million to settle a foreign exchange-related lawsuit. [147]

In May 2016, multiple plaintiffs filed suit against the bank, alleging that the company had breached its fiduciary duty to ERISA plans that held American Depositary Receipts by overcharging retirement plans that invested in foreign securities. [148] In March 2017, the presiding judge declined to dismiss the suit. In December 2017, another lawsuit alleged that BNY Mellon manipulated foreign exchange rates was filed by Sheet Metal Workers' National Pension Fund. [149] BNY Mellon agreed to pay $12.5 million to settle the 2016 lawsuit in December 2018. [150]

Personal data breach Edit

In February 2008, BNY Mellon suffered a security breach resulting in the loss of personal information when backup tapes containing the personal records of 4.5 million individuals went missing. Social security numbers and bank account information were included in the records. The breach was not reported to the authorities until May 2008, and letters were sent to those affects on May 22, 2008. [151] [152]

In August 2008, the number of affected individuals was raised to 12.5 million, 8 million more than originally thought. [153] [154]

IT system outages Edit

On Saturday, August 22, 2015, BNY Mellon's SunGard accounting system broke down during a software change. This led to the bank being unable to calculate net asset value (NAV) for 1,200 mutual funds via automated computer system. [155] Between the breakdown and the eventual fix, the bank calculated the values using alternative means, such as manual operation staff. By Wednesday, August 26, the system was still not fully operational. [156] The system was finally operational to regular capacity the following week. As a result of a Massachusetts Securities Division investigation into the company's failure and lack of a backup plan, the company paid $3 million. [157]

In December 2016, another major technology issue caused BNY Mellon to be unable to process payments related to the SWIFT network. As of the time of the issue, the bank processed about 160,000 global payments daily totally an average of $1.6 trillion. [158] The company was unable to process payments for a 19 hours, which led to a backlog of payments and an extension of Fedwire payment services. [158]

Privately owned public space agreement violation Edit

According to a New York City Comptroller audit in April 2017, BNY Mellon was in violation of a privately owned public space (POPS) agreement for at least 15 years. In constructing the 101 Barclay Street building in Lower Manhattan, BNY Mellon had received a permit allowing modification of height and setback regulations in exchange for providing a lobby accessible to the general public 24 hours a day. Auditors and members of the public had been unable to access or assess the lobby for many years, and were actively prevented from doing so by BNY Mellon security. [159] [160]

In September 2018, the company began to permit public access to a portion of the lobby. [161] However, BNY Mellon remains in violation of its agreement, as the lobby must be accessible to the public 24 hours a day. [162]

Employment legal issues Edit

BNY Mellon settled foreign bribery charges with the U.S. Securities and Exchange Commission (SEC) in August 2015 regarding its practice of providing internships to relatives of officials at a Middle Eastern investment fund. [163] The U.S. SEC found the firm in violation of the Foreign Corrupt Practices Act. [164] The case was settled for $14.8 million. [165]

In March 2019, BNY Mellon staff considered legal options after the company banned employees from working from home. [166] In particular, staff cited concerns regarding the impact on childcare, mental health, and diversity. [167] The company reverted the ban as a result of employee outcry. [168]

Other legal issues Edit

In September 2009, BNY Mellon settled a lawsuit that had been filed against the Bank of New York by the Russian government in May 2007 for money laundering the original suit claimed $22.5 billion in damages and was settled for $14 million. [169] [170]

In 2011, South Carolina sued BNY Mellon for allegedly failing to adhere to the investment guidelines relating to the state's pension fund. The company settled with the state in June 2013 for $34 million. [171] [172]

In July 2012, BNY Mellon settled a class action lawsuit relating to the collapse of Sigma Finance Corp. The suit alleged that the bank invested and lost cash collateral in medium-term notes. The company settled the lawsuit for $280 million. [173]

In December 2018, BNY Mellon agreed to pay nearly $54 million to settle charges of improper handling of "pre-released" American depositary receipts (ADRs) under investigation of the U.S. Securities and Exchange Commission (SEC). BNY Mellon did not admit or deny the investigation findings but agreed to pay disgorgement of more than $29.3 million, $4.2 million in prejudgment interest and a penalty of $20.5 million. [174] [175]

As of 2015, BNY Mellon was the world's largest custody bank, [106] [176] the sixth-largest investment management firm in the world, [177] and the seventh-largest wealth management firm in the United States. [86] In 2018, BNY Mellon ranked 175 on the Fortune 500 [178] and 250 on the Financial Times Global 500. [179] It was named one of world's 50 Safest Banks by Global Finance in 2013 and 2014, [180] [181] and one of the 20 Most Valuable Banking Brands in 2014 by The Banker. [182]

The bank says it is the longest running bank in the United States, [183] a distinction sometimes disputed by its rivals and some historians. [7] The Bank of North America was chartered in 1781, and was absorbed by a series of other entities until it was acquired by Wells Fargo. Similarly, The Massachusetts Bank went through a series of acquisitions and ended up as part of Bank of America. The Bank of New York remained independent, absorbing other companies, until its merger with Mellon. BNY Mellon is at least the third-oldest bank in the US. [7]

Since 2012, BNY Mellon has expanded its number of sponsorships. [184] BNY Mellon was the title sponsor of the Oxford and Cambridge Boat Race from 2012 to 2015. [184] [185] [186] The company also sponsors the Head of the Charles Regatta in Boston. [184] In 2013, the company became a 10-year sponsor of the San Francisco 49ers and a founding partner of Levi's Stadium. [187] The company is a regular sponsor of the Royal Academy of Arts in London. [188]

The True Reformers Bank (1888-1910)

The Savings Bank of the Grand Fountain United Order of True Reformers in Richmond, Virginia was the first bank owned by African Americans in the United States. It was founded on March 2, 1888 by Reverend William Washington Browne and opened on April 3, 1889. Although the True Reformers bank was the first black-owned bank chartered in the United States, the Capitol Savings Bank of Washington, D.C. was the first to actually open on October 17, 1888.

Born in 1849, Browne was a former Georgia slave who escaped joined the Union Army in the North. After the Civil War, he founded the Grand Fountain United Order of True Reformers, a black fraternal organization. In 1887 when Browne visited Charlotte County, Virginia to establish a local branch of the True Reformers, he encountered problems. The branch arranged to keep its savings with a white shopkeeper in the county, but with racial tensions high after an 1887 lynching, the shopkeeper told other white residents that local blacks were organizing and raising funds, and the branch was forced to disband. Browne decided the True Reformers would have to found and run a bank itself so that its finances could not be monitored by whites.

The Savings Bank of the Grand Fountain United Order of True Reformers Bank opened a year after its founding, initially operating out of Browne’s home at 105 West Jackson Street in the Jackson Ward district of Richmond, Virginia. The first day’s deposits totaled $1,269.28. In 1891, the bank moved several blocks away to 604-608 North Second Street. The bank grew and survived the financial panic of 1893, during which it was the only bank in Richmond to maintain full operation, honoring all checks and paying out the full value of accounts.

Rev. Browne died in 1897 but the bank continued to thrive after his death, expanding into a number of other services including a newspaper, a real estate agency, a retirement home and a building and loan association. New branches opened as far away as Kansas, and by 1900 the bank was operating in 24 states, owning property valued at a total of $223,500.

After the turn of the century, the bank’s prospects began to falter under its new president, Reverend William Lee Taylor. Distant branches were poorly regulated, and the strict rules the bank had required for its operations in its first years were allowed to grow lax. Under Taylor, the bank made large, unsecured loans to finance lodge projects. Those loans often defaulted. When the bank’s cashier, R.T. Hill, was discovered to have embezzled $50,000 from the company, the resulting scandal brought down the bank, and most account holders lost their savings.

The bank examiner of the banking division of the State Corporation Commission ordered the closure of the bank on October 20, 1910. True Reformers Bank was placed into receivership six days later.

1992 kicked off years of rapid change at U.S. Bank

“We didn’t even know what to do with the things after we turned them on,” said one banker who, other than a brief computer training session several months prior, had lived in a world of faxes and while-you-were-away notes.

“All of a sudden we had to become self-sufficient,” added another, who had become used to dictating notes and letters that the department secretary would, in turn, type on a typewriter.

Since that time in 1992, banking has undergone many transformations. Among them, a wave of consolidation throughout the 90s. And First Bank, with $18 billion in assets, branches in seven states and a growing reputation for efficiency, was in prime position for growth through mergers and acquisitions.

Five years later, it merged with Portland-based lender U.S. Bank and formally became the company that would later acquire naming rights to Super Bowl XLII host U.S. Bank Stadium. In taking on the U.S. Bank name, the company invested in its future aspirations as a national bank. In maintaining its headquarters in Minneapolis, it nodded to First Bank’s roots dating back to the founding of First National Bank of Minneapolis and First National Bank of St. Paul in the 1860s.

Beyond the Twin Cities, during the consolidation era the company also picked up the assets and based-on-a-true-story histories of a St. Louis bank that financed Charles Lindbergh’s transatlantic flight, a Colorado bank with a branch that was the first robbed by Butch Cassidy and a Cincinnati bank whose charter was signed as the Civil War raged across the Ohio River, among other firms. A familiar face helped engineer the flurry of moves: current U.S. Bank CEO Andy Cecere, who was on First Bank’s M&A team for much of the 90s.

In the years since, U.S. Bank has continued to grow, largely organically, more than doubling in size and becoming the fifth-largest bank in the United States.

News coverage at the time of the First Bank-U.S. Bank merger foretold this trend, with one analyst telling The New York Times that First Bank “paid a full price but got something that was worth a fortune.”

Reporters also pointed out the necessity of such mergers, as industrywide investment in technology and marketing was ramping up – and those with scale were winning.

That investment by U.S. Bank will be on display next month as tens of thousands of visitors descend on downtown Minneapolis for the big game at U.S. Bank Stadium. The bank will provide out-of-towners refuge from the cold at its Possibilities Lounge, which, located at the corner of 9th St. and Nicollet Mall, will give consumers the opportunity to experiment with the latest in financial technologies such as contactless and person-to-person payments.

One thing you probably won’t find in the Possibilities Lounge? A desktop computer.

Watch the video: The Choice is Ours 2016 Official Full Version (June 2022).


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