Bank of America facts for kids
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| Public | |
| Traded as |
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| ISIN | ISIN: [https://isin.toolforge.org/?language=en&isin=US0605051046 US0605051046] |
| Industry | Financial services |
| Predecessors |
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| Founded | 1998 (via the merger of BankAmerica & NationsBank) |
| Headquarters | Bank of America Corporate Center,
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United States
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Number of locations
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c. 3,800 retail financial centers, c. 15,000 ATMs (2023) |
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Area served
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Worldwide |
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Key people
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| Products |
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| Revenue |  US$98.6 billion (2023) |
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Operating income
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 US$28.3 billion (2023) |
| US$26.5 billion (2023) |
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| AUM | US$1.62 trillion (2023) |
| Total assets | US$3.18 trillion (2023) |
| Total equity | US$292 billion (2023) |
| Owners | Berkshire Hathaway (12.8%) |
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Number of employees
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c. 213,000 (2023) |
| Divisions |
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The Bank of America Corporation (often called BofA or BoA) is a huge American bank. It helps people and businesses with money matters. Its main office is in Charlotte, North Carolina. It also has a big office in Manhattan for its investment banking work.
The bank was created in 1998 when two banks, NationsBank and Bank of America, joined together. It is now one of the biggest banks in the United States. It's also one of the top banks in the world based on its value in the stock market. Bank of America is part of the "Big Four" banks in the U.S. It handles a large part of all American bank deposits. Its main services are regular banking, managing wealth for people, and investment banking.
The history of Bank of America goes back a long way. One part of its history started in 1784 with the Massachusetts Bank. This was one of the first banks in the U.S. Another part began in 1904 with the Bank of Italy. This bank was founded by Amadeo Giannini in San Francisco. It helped Italian immigrants who sometimes had trouble getting banking services. Over the years, through many mergers and acquisitions, Bank of America grew much larger. It acquired companies like Merrill Lynch to expand its services.
Bank of America and Merrill Lynch Wealth Management are very important in their fields. The investment bank is one of the largest in the world. Its wealth management side helps manage a lot of money for clients. Bank of America has branches in all 50 U.S. states and in over 40 other countries. It serves millions of customers and small businesses.
The bank's large size and many activities have led to various legal cases over the years. These often involved issues like mortgages and financial reporting. Despite these challenges, Bank of America has remained a very large and important company. It was ranked among the top U.S. corporations by total revenue. It was also named the "World's Best Bank" by Euromoney Institutional Investor in 2018.
Contents
- History of Bank of America
- How Bank of America Works
- Bank of America Leadership
- Helping Communities
- Who Bank of America Competes With
- Important Buildings
- Images for kids
- See also
History of Bank of America
How Bank of America Started
The story of Bank of America begins on October 17, 1904. A man named Amadeo Pietro Giannini founded the Bank of Italy in San Francisco. In 1922, another bank, Bank of America, Los Angeles, was started. Giannini was a small investor in this bank. These two banks joined together in 1928. They combined with other banks to become one of the largest banking groups in the country.
In 1930, the Bank of Italy changed its name to Bank of America National Trust and Savings Association. Giannini and Orra E. Monnette led the new company together.
Growing Across California
Giannini was one of the first to offer "branch banking." This meant having many smaller bank offices instead of just one main one. By 1929, the bank had 453 offices in California. It had over $1.4 billion in total money. Giannini wanted to create a national bank. He expanded into many western states and even into the insurance industry.
In the 1950s, new rules made Bank of America separate from its insurance business. Also, federal rules stopped Bank of America from having banks in other states. Its banks outside California became a separate company. It wasn't until the 1980s that Bank of America could expand its regular banking services outside California again.
New technology also helped banks. In 1958, Bank of America launched the BankAmericard. This was a new type of credit card. It later changed its name to Visa in 1977. Other banks created their own card, which became Mastercard in 1979.
Expanding Beyond California
After new laws in 1956, BankAmerica Corporation was created. This company owned Bank of America and its other businesses.
Bank of America started expanding outside California in 1983. It bought Seafirst Corporation in Seattle, Washington. Seafirst was having financial problems. BankAmerica kept Seafirst operating under its own name until 1998.
In the 1980s, BankAmerica faced big losses from some bad loans. The company sold off parts of its business to recover. By 1992, its stock price had greatly improved.
In 1992, BankAmerica made another big purchase. It acquired Security Pacific Corporation. This was the largest bank acquisition at that time. This deal helped BankAmerica become the largest U.S. bank again by deposits. However, by 1997, it fell to second place behind NationsBank Corporation.
Joining Forces: NationsBank and BankAmerica
In 1998, NationsBank of Charlotte bought BankAmerica. This was the biggest bank acquisition in history at that time. Even though NationsBank was the buyer, the new combined bank took the more famous name: Bank of America. The main office stayed in Charlotte. Hugh McColl, who was the head of NationsBank, became the head of the new Bank of America.
In 1998, the new Bank of America had $570 billion in assets. It also had 4,800 branches in 22 U.S. states.
Bank of America from 2001 to 2007
In 2001, Ken Lewis became the new CEO. In 2004, Bank of America bought FleetBoston Financial for $47 billion. This made Bank of America even bigger. All of FleetBoston's branches changed to the Bank of America name.
In 2005, Bank of America bought MBNA, a large credit card company. This deal made Bank of America a top issuer of credit cards.
Bank of America also had operations in other countries, like Brazil and Chile. In 2006, it sold its operations in these countries to a Brazilian bank called Banco Itaú.
In 2007, Bank of America bought The United States Trust Company. This company managed about $100 billion in assets for clients. Later that year, Bank of America also bought LaSalle Bank Corporation for $21 billion. This deal made Bank of America the largest bank in the Chicago area. LaSalle's branches changed to the Bank of America name in 2008.
Bank of America During the 2007–2010 Financial Crisis
During the subprime mortgage crisis, Bank of America made two very important purchases. These deals greatly changed the company.
Buying Countrywide Financial
On January 11, 2008, Bank of America announced it would buy Countrywide Financial. Countrywide was a very large company that handled home loans and mortgages. This purchase made Bank of America the biggest company for originating and servicing mortgages in the U.S. It controlled a large part of the home loan market. Countrywide Financial later changed its name to Bank of America Home Loans.
Buying Merrill Lynch
On September 14, 2008, Bank of America announced it would buy Merrill Lynch & Co., Inc. This was a huge deal worth about $50 billion. Merrill Lynch was facing serious financial problems. This purchase helped save Merrill Lynch from going out of business. This acquisition made Bank of America the largest financial services company in the world.
However, Merrill Lynch had lost a lot of money. Bank of America found out about these big losses after agreeing to the deal. The U.S. government encouraged Bank of America to complete the merger. The bank's stock price dropped a lot after this news.
The acquisition made Bank of America a leader in helping companies raise money and advising on mergers. As the financial crisis got better, Merrill Lynch started making profits again.
Government Support and Repayment
On January 16, 2009, Bank of America received $20 billion from the U.S. government. This was part of a program called the Troubled Asset Relief Program (TARP). It was in addition to $25 billion the bank received earlier. This money helped the bank during the financial crisis and supported its merger with Merrill Lynch.
On December 2, 2009, Bank of America announced it would pay back all $45 billion it received from TARP. The bank completed the repayment on December 9. The CEO, Ken Lewis, said they were happy to repay the money to taxpayers.
Settlement Regarding Bonuses
In 2009, Bank of America agreed to pay a fine to the U.S. government. This was because the bank did not fully tell its shareholders about large bonuses being paid at Merrill Lynch before the merger. A judge at first did not approve the settlement, saying the fine would be paid by the shareholders who were supposed to be protected. Later, a revised settlement with a larger fine was approved.
Changes in Leadership
Ken Lewis retired as CEO at the end of 2009. Brian Moynihan became the new president and CEO on January 1, 2010.
Bank of America from 2011 to Today
Making the Bank Smaller (2011 to 2014)
From 2011, Bank of America started reducing its number of employees. This was part of a plan to save money. The bank also began to close some of its physical branches. This happened as more customers started using online and mobile banking. By 2014, Bank of America had 31 million online users and 16 million mobile users.
In 2005, Bank of America bought a 9% share in China Construction Bank. This was a big step into China's growing banking market. However, in 2011, Bank of America decided to sell most of its share. By 2013, it had sold all its remaining shares in the Chinese bank.
Large Settlement with the Justice Department
In August 2014, Bank of America agreed to a very large settlement with the U.S. Justice Department. It was nearly $17 billion. This was to settle claims related to the sale of certain mortgage-backed investments. The bank paid fines and provided relief to homeowners and others affected.
Helping Military Personnel
Bank of America works with the United States Department of Defense. They created a bank called DOD Community Bank. This bank provides services to military personnel. It has branches and ATMs on U.S. military bases in many countries around the world.
Decision on Military-Style Guns
In April 2018, Bank of America announced a new policy. It would stop providing money to companies that make military-style weapons. The bank stated it wanted to help reduce mass shootings.
Growing Again (2015–Present)
Starting in 2015, Bank of America began opening new branches in cities where it didn't have a retail presence before. This included cities like Denver, Minneapolis–Saint Paul, and Indianapolis.
In 2018, Bank of America expanded into Pittsburgh and other areas in Ohio. These areas were already strongholds for other big banks. However, Bank of America quickly gained a good market share in these new locations.
In 2020, Bank of America hired new advisors. Their job is to help very wealthy clients manage their money.
How Bank of America Works
Bank of America makes most of its money in the United States. Its main goal is to be the top bank in its home market. It has done this by buying other companies.
Banking for Everyday People
This is the largest part of the company. It offers financial services to regular people and small businesses. These services include:
- Banking accounts
- Investments
- Credit cards
- Loans for homes and businesses
It also offers stockbroker services through a part of the company called Merrill Edge. This division makes money from interest on loans, service charges, and fees. Bank of America has over 4,600 branches and about 15,900 automated teller machines (ATMs).
Bank of America is part of the Global ATM Alliance. This is a group of big international banks. If you use your debit card at an ATM of another bank in this group while traveling, you might pay fewer fees.
Banking for Businesses
The Global Banking division provides services to businesses. This includes investment banking and lending money to companies. This part of the bank helps businesses with mergers and acquisitions. It also helps them raise money and trade stocks and bonds. This division is headquartered in New York City.
Managing Wealth and Investments
The Global Wealth and Investment Management (GWIM) division helps manage money for large organizations and individuals. This includes Merrill Lynch Global Wealth Management. It is one of the largest wealth managers in the U.S. It manages trillions of dollars for clients.
Global Markets
The Global Markets division offers services to big clients like other financial institutions. This includes trading in financial securities. They also provide research and help manage risks using derivatives.
Employee Wages
On April 9, 2019, Bank of America announced it would increase its minimum wage. It started at $17.00 an hour in May 2019. The goal is to reach $20.00 an hour by 2021.
Bank Offices
Bank of America's main offices are in the Bank of America Corporate Center in Charlotte, North Carolina. This tall building was finished in 1992.
The bank also has international offices. Its European headquarters are in Dublin. Its Asian headquarters are in Hong Kong and Singapore.
Bank of America Leadership
| Name | Position |
|---|---|
| Brian Moynihan | Chairman of the board and chief executive officer, Bank of America Corporation |
| Susan S. Bies | |
| Frank P. Bramble, Sr. | |
| Arnold W. Donald | |
| Monica C. Lozano | |
| Lionel L. Nowell, III | |
| Clayton S. Rose | |
| Thomas D. Woods | |
| Maria T. Zuber | |
| Sharon L. Allen | |
| Jack O. Bovender, Jr. | Lead Independent Director, Bank of America Corporation |
| Pierre J. P. de Weck | |
| Linda P. Hudson | |
| Thomas J. May | |
| Denise L. Ramos | |
| Michael D. White | |
| R. David Yost |
Chief Executive Officers (CEOs)
The CEO is the top leader of the company. Here are the CEOs of Bank of America since its merger in 1998:
- Hugh McColl (1998–2001)
- Ken Lewis (2001–2009)
- Brian Moynihan (2010–present)
Helping Communities
Bank of America has made many efforts to help communities.
- In 1998, the bank promised $350 billion over ten years. This money was for affordable homes, helping small businesses, and creating jobs in areas that needed them.
- In 2004, it pledged $750 million over ten years for community development.
- In 2007, the bank offered employees money back for buying hybrid vehicles. It also offered lower interest rates for energy-efficient homes.
- Bank of America has also given money to health centers and homeless shelters.
- In India, the bank supports preserving historical items and arts and culture.
Who Bank of America Competes With
Bank of America has many competitors. These include other large banks like Wells Fargo, Chase Bank, Citigroup, and US Bank. It also competes with other financial companies like PNC Financial Services, Capital One, and Truist.
Important Buildings
Bank of America has its name on many important buildings across the United States and in other countries. Some of these include:
- Bank of America Tower in Phoenix, Arizona
- 555 California Street, a former headquarters, in San Francisco, California
- Bank of America Tower in Jacksonville, Florida
- Bank of America Plaza in Atlanta, Georgia
- Bank of America Tower in New York City
- Bank of America Corporate Center in Charlotte, North Carolina (the main headquarters)
- Bank of America Plaza in Dallas, Texas
- Bank of America Tower in Hong Kong
In 2010, the bank finished building the 1 Bank of America Center in Charlotte. This tower is designed to be environmentally friendly.
Past Buildings with the Bank's Name
Some buildings used to be named after Bank of America but are not anymore.
- The Robert B. Atwood Building in Anchorage, Alaska, was once called the Bank of America Center.
- The Bank of America Building (Providence) in Providence, Rhode Island, was leased by the bank until 2012. It's often called the "Superman Building."
- The Miami Tower in Miami, Florida, was known as the Bank of America Tower for many years.
- The TC Energy Center in Houston, Texas, was also previously known as Bank of America Center.
Images for kids
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Bank of America, Los Angeles
Bank of America, Los Angeles was founded in California in 1923.
See also
- List of members ATM Industry Association (ATMIA)
- BAML Capital Partners
- Bank of America (Asia)
- Big Four banks
- Calibuso, et al. v. Bank of America Corp., et al.
- List of bank mergers in the United States
- List of largest banks in the United States
