Bank of America Corporation

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Bank-of-America-2018.svg

Bank of America is an American multinational financial services company based in North Carolina, with central hubs in New York City, London Dublin,[1] Hong Kong, and Toronto. It is the 2nd largest banking institution in the USA, after JP Morgan Chase. As one of the Big Four, it services ~10.73% of all American bank deposits, in direct competition with Citigroup, Wells Fargo & Company, and JP Morgan Chase.

The group is organised around 5 areas of activity:

  • 56.5%: Commercial banking;
  • 22.6%: Business and investment banking;
  • 13.1%: Wealth management and Asset management;
  • 6.6%: Market banking;
  • 1.2%: Other.

Tax Policy: 20 Bank of America maintains 91 subsidiaries in offshore tax havens.ref

BankTrack-Fossil-Bank.svg Financing Fossil Fuels:[2]
 Tar Sands: $321m   Arctic Oil: $327m   Offshore: $4.60bn   Fracking: $10.94bn   LNG Export: $1.72bn   Coal Mining: $231m   Coal Power: $1.67bn 

Company

Shareholders

Total float: 99.9%
Source: MarketScreener.svg, Mar.2020

Bank of America Merrill

Merrill-Lynch-2019.svg
Merrill, formerly branded as Bank of America Merrill Lynch, is BoA's investing and wealth management division. Together with the investment banking arm #BoA Securities, both firms engage in prime brokerage, security dealings and broker-dealer activities, with Merrill's broker-dealer arm known as Merrill Lynch, Pierce, Fenner & Smith. Merrill also operates #Merrill Edge, an electronic trading platform.

Prior to its acquisition by Bank of America in Jan.2009 (about which troubling questions remain unanswered),[3] the firm was known as Merrill Lynch & Company Inc. In Oct.2013, the firm was dissolved and hived up,ref although some of BoA's subsidiaries continued to use the Merrill Lynch name. In 2019, Bank of America rebranded the unit to "Merrill".ref

See main article: Bank of America Corporation/Merrill Lynch & Company

Merrill Edge

Merrill-Edge.svg
Merrill Edge, part of BoA's retail banking division, is an an electronic trading platform, providing "no-frills" online discount brokerage services,ref focusing on investors with between $100,000-$250,000 to invest.ref,ref,ref The service is intended for well-educated clients who want to invest between $100,000 and $250,000.ref Customers have 3 options for making trades: DIY; handing over a $6.95 fee for every order; and paying a fee of 1% of the capital for a separately-managed account.ref

Launched in Jun.2010, Merrill Edge was created to merge Bank of America Online Investing (Quick & Reilly) and Merrill Lynch's research, investment tools, and call centre counsel.ref,ref Merrill Guided Investing is offered with and without an advisor. Merrill, Merrill Lynch, and/or Merrill Edge investment advisory programs are offered by Merrill Lynch, Pierce, Fenner & Smith Inc, and Managed Account Advisors LLC.[1][2][3] ref,ref

BoA Securities Inc

Bank-of-America-Securities.svg
BoA Securities, (formerly "Bank of America Merrill Lynch") is the the marketing name used by BoA's Global Banking and Global Markets divisions, operating as investment banks.todo It was formed by the merging of BOA's and Merrill Lynch's corporate and investment banking operations, following BoA's acquisition of Merrill Lynch in Jan.2009.

BoA Securities acts as a broker for its clients, and as a dealer in the purchase and sale of corporate debt and equity securities, US Govt securities. It also acts as a broker/dealer in the purchase and sale of money market instruments, high yield bonds, municipal securities, financial futures contracts and options, and other financial instruments.
As an investment banking entity, BoA Securities provides corporate, institutional, and govt clients with a wide variety of financial services, including underwriting the sale of securities to the public; structured and derivative financing; private placements; mortgage and lease financing; and financial advisory services, including advice on mergers and acquisitions.ref

Bank of America Private Bank

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Bank of America Private Wealth Management, (formerly known as "US Trust"), provides investment management, wealth structuring, and credit and lending services to clients.

Timeline

  • Feb.2019: Bank of America Private Bank: as part of simplifying branding for its wealth management and private banking operations, the US Trust name disappeared, with the division being renamed.ref
  • Jul.2007: US Trust, Bank of American Private Wealth Management: The acquisition was completed, with US Trust forming the basis of BoA's private wealth management division.ref
  • Nov.2006:
    Bank-of-America-1998.svgDeals-All-Change.svg
    Bank of America bought US Trust from Charles Schwab.ref The acquisition strengthened BoA’s position in the lucrative private banking sector and its ability to cater to some of the nation's wealthiest clients.
  • 2001-2006: Culture clash: integrating the exclusive US Trust (which pampered the financial elite) into DIY discount-broker Charles Schwab resulted in conflicts that ultimately undermined the merger.[6] Kador, John (October 1, 2004). "Cultures in Conflict".
  • Jul.2000: Fined $10m: US Trust Corporation was issued a "cease and desist" order directing it to strengthen money laundering policies relating to the Bank Secrecy Act. The order also included a fine of $10m. ref
  • Jun.2000:
    Charles-Schwab-2001.svgDeals-All-Change.svg
    Charles Schwab & Company acquired US Trust, which became a wholly-owned subsidiary. The acquisition broadened Charles Schwab's wealth management platform, and helped to dam client outflow to bigger wealth management firms like Merrill Lynch and Morgan Stanley.ref
  • 1995: Chase Manhattan Corporation purchased US Trust's institutional custody, mutual funds servicing, and unit trust businesses. Chase also agreed to purchase US Trust Corporation of New York, the parent company's security processing and related back-office business. This sale of ~33% of US Trust's business allowed it to focus on its core businesses: asset management, private banking, and fiduciary.
  • 1995: J & W Seligman & Company's individual account business was acquired, along with J & W Seligman Trust Company.
  • 1993: Capital Trust Corporation was purchased, paving the way for the creation of US Trust Company of the Pacific Northwest, with offices in Portland, Oregon.
  • 1992: Campbell, Cowperthwait & Company, a Manhattan-based investment advisory firm specialising in high-quality growth stocks, was acquired.
  • 1992: Delafield, Harvey, Tabrell Inc, an investment advisory firm, was acquired, becoming the company's New Jersey subsidiary.
  • 1990s: Expansion: new offices were opened across the continental United States.
  • 1989: Denker & Goodwin, a Dallas-based investment firm, was acquired to form the basis of a full-service Texas trust subsidiary with banking powers.
  • 1987: Appealing to the hoi polloi: the account minimum was lowered from $1–2m to $250,000.[4]
  • 1987: U.S. Trust announced that it would no longer make basic business and real estate loans and would seek buyers for virtually all of its commercial, industrial, and real estate portfolios. This action restricted its corporate banking activities to serving securities industry and financial institution clients, both non-credit businesses.
  • 1986: Summit Management Company Inc, based in California, was acquired.
  • 1984: Financial Technologies International was launched to market and license computer software products and services to financial institutions.
  • 1980: Restructuring: To cut costs, "poor relations" (those with assets below $2m) lost privileges, such as having a bank officer drive to Connecticut to walk the poodle or relying on the company to write and mail checks to the gas and electric companies.[5]
  • end.1970s: Poor performance: profits declined; large pension fund clients were lost due to "inadequate performance"; Municipal Assistance Corporation certificates worth $397m disappearing from its vault didn't go down well.ref As a result, US Trust pulled out of international lending by closing its Geneva and London branches.[5]
  • 1978: US Trust Corporation was created as a new parent holdco, with US Trust Company becoming its subsidiary.ref
  • 1965: 85% of the company’s gross income came from trust and investment operations and estate administration. Banking emerged as an opportunity, and the firm began selling investment services to banks and insurance companies. By 1977, banking made up 50% of the company’s earnings.
  • mid.1800s: The company had grown to have a list of wealthy clients. Emerging capital markets offered opportunities to float large bond issues to finance major construction projects, including the New York Central Rail Road and the Panama Canal.
  • 1853: United States Trust Company of New York was created as a financial company to serve both institutions and individuals by acting as executor and trustee of their funds, by a group of wealthy men who invested $1m.[6]
Additional Sources: "International Directory of Company Histories, Vol.17", Editor: Tina Grant, Thomson Gale, St James Press, Detroit, Michigan, 1997. ♦ "U.S. Trust: A History of Growth with a Commitment to Personal Service", U.S. Trust Corporation, New York, 1996. ♦ "Bank of America Corporation", Wendy Johnson Bilas, St James Press, Detroit, Michigan, May.2009, ISBN: ISBN-13: 9781558627642

Timelines

ToDo: link, link, link, link, link, link, DDG
  • Jun.2017: MBNA's UK portfolio was purchased by Lloyds Banking Group.ref,ref
  • Jan.2013: MBNA Virgin Credit Card: Virgin Money agreed to buy the Virgin Credit Card assets which MBNA had serviced and managed in partnership with Virgin Money since 2002.ref
  • May.2010:
    Ameriprise-Columbia-Management-2000.svgDeals-Arrow-Right.svg
    Columbia Management Group LLC, FleetBoston Financial's asset management business, was sold to Ameriprise Financial Inc.ref,ref
  • Jan.2006: MBNA Corporation, a Delaware-registered bank holding company ,and parent company of wholly owned subsidiary MBNA America Bank NA, was acquired, giving BoA ~40m active credit card accounts,ref and resulting in 6,000 job cuts.ref MBNA was renamed to "Bank of America Card Services"; by mid-2006, all credit card products had been re-branded as Bank of America. Consequently, MBNA Corporation became "MBNA America Bank, National Association"; in Jun.2006, it was renamed to "FIA Card Services, National Association". In Oct.2006, a BoA subsidiary "Bank of America, National Association" merged with and into FIA.ref MBNAWikipedia-W.svg mbna.co.uk
  • Apr.2004:
    Bank-of-America-FleetBoston-Financial-2000.svgDeals-Arrow-Left.svg
    #FleetBoston Financial Corporation, a Boston, Massachusetts–based bank, was acquired, creating the 3rd-largest bank merger in history. ref,ref WebsiteArchive-org-sm.svg
  • 1983: Charles Schwab & Company, an American bank and stock brokerage firm based in San Francisco, California, was acquired - but not for long. In Feb.1987, a group of investors including management and founder Charles R Schwab, bought the company back.ref
  • ?date?: BoA agreed to sell BankAmerica Finance Ltd, its British mortgage operation, to the Bank of Ireland Group plc.

FleetBoston Financial Corporation

ToDo: FleetBoston FinancialWikipedia-W.svg, BankBostonWikipedia-W.svg, Columbia Management Group LLC

References

  1. ^ Bank of America completes merger. Bank of America, 2nd largest lender in the USA, has completed its move from London to Dublin as part of its Brexit preparations. The British entity has combined with its Irish operation to form "Bank of America Merrill Lynch International Designated Activity Company". The Dublin office will now function as Bank of America’s European hub of operations. Cianan Brennan, The Times, Dec.04.2018.
  2. ^ Banking on Climate Change: Fossil Fuel Finance Report 2020. The new Report shows financial support for the Fossil Fuel Industry has increased every year since the Paris Agreement was adopted in Dec.2015. Again, the big USA banks dominate; again, JPMorgan Chase leads the pack, with Wells Fargo, Citigroup, and Bank of America close on their heels. These 4 banks alone are responsible for 30% of all fossil fuel financing out of the 35 major global banks since the Paris Agreement was adopted. Rainforest Action Network, Mar.20.2019.
  3. ^ Three Troubling Questions About Bank of America's Epic Acquisition of Merrill Lynch. The deal resulted in Bank of America having to settle for $2.43bn a shareholder lawsuit that alleged the bank had failed to provide sufficient disclosures to investors. Why did Bank of America pay so much for Merrill Lynch? Why didn't Bank of America fully disclose Merrill Lynch's losses to shareholders? Why was (truthful) general counsel Timothy Mayopoulos terminated by Bank of America's management? John Reeves, The Motley Fool, Sept.14.2013.
  4. ^ "Affirmative Action", Matthew Schifrin, Forbes, Jan.03.1994.
  5. ^ a b "Brahman's Banker", Robert A Bennett, New York Times, Jan.20.1980.
  6. ^ "U.S. Trust Corp.", Robert Halasz, St James Press, Detroit, 1997.