Who is bank one

Client presentation. Bank One is a generalist commercial bank registered in Mauritius. Bank One provides all the services of a universal bank retail, corporate, SME banking, etc.

It has a local presence with 13 branches and a regional presence with a representation office in South Africa. It is currently the country's tenth largest bank in terms of loans and deposits. Project description. This credit line will strengthen the banks equity, after the authorization of the Central Bank of Mauritius.

This credit line is Proparco's second operation with Bank One, following an initial USD 6m operation in , also earmarked to strengthen the bank's capital structure.

Project impact. The project will support private sector development in Mauritius. The bank's portfolio is highly diversified, both in terms of clients and the sectors financed. The bank will benefit from support from Proparco to improve environmental and social risk management. The surveys induced competition among the branches and provided an incentive to match the best.

Virtually all new affiliates met the challenge and improved their return on assets and profitability after merging with First Banc. The company's growth was also fueled by the liberalization of Ohio banking laws during this time, which were amended to allow statewide branching and mergers between banks located in any county. The holding company's name was changed to Banc One in , and by the corporation was one of only seven banking organizations among the largest in the United States to have recorded ten consecutive years of increases in both earnings and dividends.

In , Time magazine called Banc One 'perhaps the most advanced financial institution in the United States. Federal and state banking regulations changed dramatically in September , enabling Banc One to enter its first agreement with a banking organization outside of Ohio. Purdue National Corporation in Lafayette, Indiana, became the first out-of-state bank to affiliate itself with Banc One. After a relative lull in acquisitions from to , Banc One's merger activity picked up. Banc One took advantage of nationwide reciprocal banking soon after it was legitimized in Ohio in By the end of the following year, the corporation had added affiliates in Kentucky, Michigan, and Wisconsin.

Nevertheless, the corporation focused on regional operations until the early s, when it began to extend its presence west and south as virtually every barrier to interstate banking was removed. John B. McCoy, son of John G. Like his father, John B. After three years in the U.

Air Force, he took a position at Citicorp in New York, where he stayed for less than a year before returning home to Columbus in The younger McCoy worked his way through six different sections of the bank--including the credit card division, which he built into one of the nation's largest--and, in , he was named CEO of the corporation.

The bank lent more to consumers than to businesses and rarely offered loans at all to large companies. From to , John B. These acquisitions helped Banc One to thrive during an early s recession.

Banc One continued to refine the branch banking experience in the s by decreasing its number of tellers, adding new drive-in lanes and ATMs, giving the platform officers separate offices, adding travel agencies and a discount securities broker, and leasing space to insurance agents and real estate brokers.

The corporation also introduced such innovative concepts as Sunday hours in Ohio, 'weekly specials,' and credit card tie-ins with groups such as the American Association of Retired Persons and airline frequent flyer programs. However, by the beginning of the s, Banc One's five-state Midwestern market, in which the population had remained stagnant for years, was becoming saturated.

In order to maintain the corporation's customary 15 percent annual profit growth, John B. MCorp was Banc One's first turnaround situation, and observers wondered whether the corporation was up to the challenge, especially given the competitive banking environment in Texas.

Led by John B. For fiscal , Banc One earned a return on assets of 1. The company sustained its annual earnings per share increase, becoming one of only 14 nationally traded U. American Banker named John B. McCoy 'Banker of the Year' for In the mids, the inadequacy and inefficiency of Banc One's decentralized management strategy rose to the surface, and the company reorganized operations, which by included a network of 57 banks, along five core business lines: commercial banking, retail banking, specialty finance, investments, and credit cards.

Banc One also sought to streamline operations and cut costs, and thus the company eliminated about 4, jobs and sold or closed about bank branches. The bank planned to devote time and energy to restructuring and strengthening the company. Plans to develop national, profitable businesses and to enhance marketing efforts were put in place.

The bank's focus on strengthening operations culminated in its largest acquisition to date when the company bought First USA Inc. The acquisition effectively created the third largest U. The company indicated interest in further growth through acquisitions and in working toward the building of a national presence.

In the summer of , Edmund Aiken headed a group of ten investors who wanted to take advantage of the National Banking Act that President Abraham Lincoln had signed into law earlier that year. This act allowed national banks for the first time to exist along with state-chartered institutions.

Aiken, a year-old private banker, realized that the demands of financing war-related businesses, together with the industrial and commercial growth of Chicago and the development of Illinois, created a need for a national bank in the Midwest. The bank opened its doors for business on July 1, , the day the Battle of Gettysburg began. The First was an immediate success.

The First moved twice during its first five years, as increasing business forced it into larger quarters. Although the First was housed in a fireproof structure when the Chicago Fire struck in , its building was seriously damaged. Fortunately, the bank's safes and vaults withstood the flames and nothing of importance was lost. The job of collecting records and monies buried in the ashes fell to Lyman Gage, a young cashier who eventually became president of the bank and then secretary of the treasury in President William McKinley's cabinet.

Gage was one of a long line of employees who used his training and experience at the First to serve the federal government. Three months after the Great Fire, the First reoccupied its charred quarters and began helping Chicagoans rebuild their city. Out of the ruins, the First emerged as one of the most prominent and respected business leaders in the community.

As Chicago prospered, the First expanded and changed with its growing customer base. The bank began declaring quarterly dividends to customers at mid-year in That same year, it became the first bank to open a women's banking department, to make ladies more comfortable when conducting business in the male-dominated bank.

During the Panic of , the First found an original solution for the currency shortage: it imported gold from its London correspondent bank, a practice that quickly spread to other banks.

In the bank was the first American bank to establish a formal pension plan, a clear indication of its employee-oriented management style. At the turn of the century, the industrial revolution created an unprecedented demand for credit. The First met this need through mergers. In this way the First acquired the resources to serve both the needs of its regular customers, whose businesses were flourishing, and the needs of new customers, who were trying to capitalize on the opportunities of the era.

In the First opened the First Trust and Savings Bank, a separate corporation to serve the non-commercial members of the community. The First celebrated its 50th anniversary in by becoming a charter member of the Federal Reserve system. By the bank was one of the three most active banks in foreign exchange in the country.

During World War I, the First played a major role in helping the country finance the war effort. This patriotic act, coupled with the First's President James B. During the s the bank grew steadily.

A new addition to its headquarters, designed by Daniel Burnham, was completed in just as the number of depositors reached 20, But as passed, this optimism turned into a painful pessimism. As the great crash neared, the First witnessed a stream of large customer withdrawals to cover speculative securities purchases. During the Depression that followed the stock market crash, the First's sound financial base kept it from failing as 11, weaker banks did. Even in the depths of the Depression, the First never skipped an interest payment on savings deposits.

Its strength allowed the First to merge with the Foreman State Banks in early and accept all of their deposit liabilities. When President Franklin Roosevelt proclaimed a national bank holiday in to give banks a chance to stabilize, the First was one of the few banks able to open its doors without regulatory delays. Part of the reason for the First's quick reopening was its status as a Federal Reserve member bank, which meant that it accrued advantages that non-member banks did not.

Because the First Union Trust and Savings Bank was not a member, the First decided to absorb all of the savings bank's business in order to retain its customers' loyalty.

The establishment of the National Recovery Administration by Congress and the passage of the Banking Act of better known as the Glass-Steagall Act , which created the Federal Deposit Insurance Corporation and separated commercial banking from investment banking, strengthened confidence in the First.

When the Securities and Exchange Commission was established in , fears of a second crash dissipated. The First weathered the Depression and continued to grow as Roosevelt's recovery policies took hold.

Remembering that capital costs skyrocketed during World War I, the First advised businessmen to avoid high prices by borrowing money for investment before any outbreak of fighting. Women were hired to fill wartime vacancies and to staff new positions as business increased rapidly. Brown pioneered the development of highly specialized lending divisions to respond quickly and innovatively to corporate customers' financial needs. During the s and s the First enjoyed a period of sustained growth as it continued to build on its reputation as both a specialist and an innovator in business loans.

As a result, the First's assets more than doubled and the number of its loans quadrupled during this period. In the First opened a London office to improve its service to foreign correspondent banks and customers engaged in international trade. Three years later, the First started a Far East office in Tokyo. In the bank opened a representative office in Beijing, the first American bank to open such an office in China. As the First approached the end of the s, the bank prepared to expand, as fast as it could, throughout the Midwest and the world.

When Homer Livingston passed leadership of the bank to Gaylord Freeman in , an attitude of unrestrained optimism pervaded at the First. That year the bank was reorganized as the major subsidiary of the new First Chicago Corporation to allow it to broaden the scope of its activities worldwide. This reorganization gave the First a way around restrictive banking laws. From the beginning of his tenure, Freeman followed an aggressive program to increase its assets through the acquisition of more loans.

Freeman doubled First Chicago's size in just five years. He accomplished this by recruiting top business-school graduates and quickly promoting them to positions of considerable lending authority.

Unfortunately, this program produced one of the worst loan portfolios in the industry: in the bank's percentage of non-performing loans reached a high of 11 percent--twice the national average. Robert Abboud replaced Freeman in and immediately began dealing with First Chicago's bad loans. Unlike Freeman, who was warm and supportive, Abboud's methods were described as tyrannical and intimidating.

Where Freeman favored a decentralized managerial style that bestowed maximum freedom on loan officers to make decisions, Abboud favored a centralized style to check and double-check every loan. In one month period officers left, reducing the bank's executive ranks by 12 percent.

Even after promoting 84 employees from within, Abboud was still officers short of his budget, but he refused to hire recent business school graduates because he feared their lack of experience. Abboud also drove away established clients with his highly conservative loan policy. His new controls doubled the time it took to approve loans and also left old customers uncertain as to whether their loans would be approved.

Abboud raised interest rates on loans and required corporate customers to maintain compensating balances of 15 percent on an unexercised credit line when his competition required ten percent.

Abboud justified his actions by pointing proudly to First Chicago's balance sheet, which showed a to-1 ratio of assets to equity; only one other bank in the country had a better ratio. By Abboud had brought non-performing loans down six percent. First Chicago's five percent rate was still double the national average, however.

After three years, Abboud realized that First Chicago was not prospering. Clients were not returning and new customers were repelled by First Chicago's reputation for insensitivity to its customers' needs.

In Continental Illinois, First Chicago's chief rival, was strikingly similar to First Chicago in size and makeup; they both depended heavily on commercial loans for volume and on money markets for funding. Abboud decided that First Chicago had to become a risk-taker to catch up. Abboud chose to gamble in two speculative areas: fixed-rate loans and arbitrage in the Eurodollar market.

He was hoping for interest rates to fall, but, following the bank's own forecast, they rose in late and early The Federal Reserve made the bank's Eurodollar situation worse by tightening up regulations. Thus, First Chicago found itself funding its Eurodollar placements with higher-cost deposits.

Although consumer banking doubled in five years under Abboud, his speculative decisions cost the bank dearly. Barry F. Sullivan, an executive vice-president of Chase Manhattan Corporation, succeeded Abboud as chairman and chief executive of First Chicago in July He had the 'people skills' the autocratic Abboud lacked, as well as the experience of putting a floundering bank back on its feet.

Once in office, Sullivan zeroed in on building a new management team. He recruited officers for product development and corporate accounts, expanded the corporate-planning staff from three to 44, and reshuffled the talent he already had.

At the same time, Sullivan created a new organizational structure for First Chicago based on strategic business units SBUs.