The story of Bank of America begins in a rundown office, behind a desk made of two planks stacked atop barrels. The man seated behind the desk, ready to lend money to help rebuild San Francisco after the earthquake of 1906, was Amadeo Gianni. Gianni, who was particularly proud of the fact that all of those loans were eventually repaid, had created the beginnings of a major banking institution from the ruins of a major city.
Gianni merged with the existing Bank of America in 1928. The firm was based in Los Angeles, which helped Gianni grow his holdings there. He wanted to expand into insurance, and he was able to consolidate under the Transamerica Corporation, but regulators forced the two entities to separate in 1953. The Bank Holding Company Act of 1956 further prevented banks like Bank of America from expanding into “non-banking subsidiaries.” Further, the bank was barred from interstate banking activities. Bank of America would halt its consumer activities in California
Moving Out of California
Bank of America became one of the largest banks in California because of soldiers. Most had their pay checks direct deposited into their Bank of America accounts. Regulations forced the bank to stay within California until 1967, when changes to legislation allowed Bank of America to form BankAmerica Corp to own companies outside of the state.
Bank of America almost went under in 1986, because of some bad loans made to third world countries. Latin America was especially problematic for the bank, which suffered losses so high that the company was in danger of a hostile takeover.
The 1987 stock market crash would see shares in the bank dip to less than $10, but the company would rebound within a few years. By 1992, Bank of America had orchestrated some of the biggest gains in a half decade.