Bank of America Corporation is one of America’s biggest financial companies with headquarters at 100 North Tryon Street, Charlotte, North Carolina, United States. According to Wikipedia it is the largest bank holding company in the United States by assets and the second largest by market capitalization (1). This leading bank holding company is registered in the New York Stock Exchange as BAC, in the Tokyo Stock Exchange as 8648:JP; it is also listed in the Dow Jones Industry Average Index and the S&P 500 Index. As of 2009, BAC had disclosed the worth of their total assets as US $2.223 trillion with total revenue of US $150.45 billion. Aside from being one the leading bank holding company, it is involved in Financial and Investment services industry also.
The corporation has a strong history in the United States of America. It was founded 1928 when Amadeo Peter Giannini merged his Bank of Italy with Orra E. Monnette’s bank in Los Angeles. Hence the union of the two banks took the name “Bank of America” which was headed by Giannini and co-chaired by Orra E. Monnette. Throughout the 1950s and 1960s, the bank faced strict legislations that restricted its further expansion and diversification. In 1967, due to the Bank Holding Company Act, Giannini-Orra’s bank and all its subsidiaries were taken over by the newly formed BankAmerica Corporation. Bank America swiftly grew into one of the biggest Bank Holding Company in the United States; but due to heavy losses in 1997, the BankAmerica Corporation could not sustain its financial standing. Finally in the year 1998, the largest US bank holding company of the time NationsBank Corporation acquired the BankAmerica Corporation. This acquisition resulted in the renaming of NationsBank to Bank of America Corporation.
On January 1 2009, the BAC successfully closed the deal to purchase Merrill Lynch & Co., Inc. at approximately US $50 billion. Merrill Lynch & Co., Inc. was on the verge of bankruptcy before the merger and due to this reason the bank was hesitant throughout the process. According to an official statement, BAC tried to abandon the deal in December when the extent of losses of Merrill Lynch & Co., Inc. was fully disclosed, but the US government forced the bank to go through with the deal. This merger proved to be disastrous for the bank as was shown in the earnings released in January of 2009 which revealed huge losses for newly purchased Merrill Lynch & Co., Inc. These losses brought the market capitalization of Bank of America including Merrill Lynch & Co., Inc. down to a total of US $ 45 Billion. The BAC stock price tumbled to about US $ 7 which was recorded as the lowest stock price for the company in 17 years. This disastrous situation called for government intervention. On January 2009, the bank received a federal bailout package of over US $ 40 billion. This bailout money helped it in regaining its lost stature and in less than a year, the Bank of America erased its previous losses. On 9th of December 2009, it was officially announced the bailout money had been completely repaid back to the US federal government.