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A bank for America Bank of America is living up to its name. Formed by the $43 billion merger of the already large Bank of America and NationsBank, it has close to 5,000 branches in 22 states and the District of Columbia. And the bank is still looking to become an even bigger giant through acquisition. Before the merger, which was completed in September 1998, Bank of America was the third-largest commercial bank, based in San Francisco and with a major presence in the West. NationsBank, based in North Carolina, had a strong presence in the Southeast. Combined, Bank of America is the second-largest American bank, in terms of assets. A history of aggressive expansions Both sides of the banking merger grew through aggressive mergers and acquisitions in the last decade. In the early 1990s, Bank of America bought out Security Pacific, and made forays into the mortgage origination business, through acquisitions of Minnesota's United Mortgage and New York's Arbor National Holdings. In the 15 years before the merger, NationsBank had metastasized from a smallish Charlotte-based bank with assets of $12.8 billion to a major player with over $300 billion in assets and operations in 22 states (and the District of Columbia) and 40 countries. Both banks had also been looking to boost their investment banking operations previous to the merger. Bank of America had acquired high-tech I-banking stalwart Robertson Stephens & Company, although the company sold the bank affectionately known as Robbie to BankBoston after the announcement of the merger with NationsBank. In a deal that mirrored Bank of America's, NationsBank had acquired Robertson Stephens competitor Montgomery Securities. Further expansion Bank of America is now looking to poke its nose into New England and the eastern Midwest. Officially, NationsBank acquired Bank of America - the combined bank has its headquarters in NationsBank's digs in Charlotte, North Carolina. With 8.1 percent of U.S. bank deposits and 29 million households it can count on as customers, bank is the largest in the nation. However, the merger hasn't been a smooth one. In October 1998, former Bank of America CEO David Coulter (then-president of the merged bank) resigned amid a power struggle with CEO Hugh McColl (who was the former CEO of NationsBank). In January 1999, per McColl's recommendation, 29-year NationsBank veteran Kenneth D. Lewis was chosen to replace Coulter as president. That move further demonstrated NationsBank's dominance in the merger. Merger woes The merger has also had some harsh consequences for employees. The new bank has announced a target of cutting 5,000 to 8,000 employees over the next two to three years. It laid off the first 1,800 in the three months following the September 1998 announcement of the merger. The firm has also announced it will reduce its less profitable overseas operations. In March 1999, Bank of America announced it was selling its private operations in Europe and Asia to Switzerland's UBS AG. An e-commerce venture Bank of America announced in July 2000 that it was forming Banc of America Purchase Street, a Web-based financial services company that would offer electronic payment and purchasing services to government agencies. The bank teamed up with NIC Commerce, an e-commerce company that helps government agencies streamline their procurement systems.
At Bank of America, MBA-level associates are recruited directly by department. One former employee cautions: "Here's a tip. You can't always choose your city. [The firm] will try, but for example if you want to work in high yield bonds, you aren't going to be working in San Francisco." The former NationsBank, unsurprisingly, has historically recruited at Southeastern schools, especially at UNC/Chapel Hill and Duke. "Our core schools on the MBA level are Wharton, Chicago, Michigan, Darden and Duke, but we will read a resume from anywhere," says one insider. In the past, Bank of America has conducted extensive college recruiting and untilized a number of training programs, ranging from domestic programs in corporate finance and operations management to global opportunities in Hong Kong, Singapore, and Thailand.
A nice, if big place Bank of America employees who worked for the San Francisco-based Bank of America before the merger with NationsBank have nothing but praise for the bank's on-site job training but caution those looking for a kinder, gentler company. "This used to be an organization where we felt like family," says a manager, but no longer. The company is now "an extremely large retail bank with an extremely large retail bank culture." This shift in the corporate atmosphere has nevertheless fostered an "entrepreneurial" environment in which new employees receive "immediate exposure to clients, upper management, and other bank groups." While some feel that the recent changes have been detrimental to employee morale, others approve of "a new aggressive attitude with an emphasis on teamwork. Hard-charging environment Bank of America insiders concur that the culture of NationsBank reflects the personality of hard-charging yet caring ex-Marine CEO Hugh McColl. "[The bank] is very aggressive, and, because the bank is growing so quickly, offers plenty of opportunities. The exposure to top management is gratifying," says one associate. "You can truly feel the 'growth' feeling," echoes a loan officer. "The culture involves team work, working hard and playing hard. You will not find many jerks in the organization, as they get culled fast," comments one insider. "Much more than other banks, this is a really go-getter kind of a place. There isn't a lot of bureaucratic bullshit. We are a lean organization." McColl himself promotes this attitude; anyone who saves the bank money will receive a check for 10 percent of the amount saved, delivered by the CEO himself. "People now and again will have Hugh McColl show up on their doorstep with a check for $10,000," one employee says. Employees seem proud of their gruff, rough-and-ready CEO. Many praise "the good senior leadership, especially the CEO" and "our grenade thrower Hugh McColl." "Every year, the senior management, including McColl, goes around to five or six cities and does a presentation where they say how the company is doing and give out the crystal grenade awards."
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