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Chemical Bank Chemical Bank was a bank with headquarters in New York City from 1824 until 1996. The bank operated as the primary subsidiary of the Chemical Banking Corporation, a bank holding company established in 1988. At the end of 1995, Chemical was the third largest bank in the U.S. with approximately $182.9 billion in assets.[1]HP Pavilion dv3-2310ea Laptop Keyboard Beginning in 1920 but accelerating in the 1980s and 1990s, Chemical was a leading consolidator of the banking industry in the United States, acquiring Chase Manhattan Bank, Manufacturers Hanover, Texas Commerce Bank and Corn Exchange Bankamong others. Following Chemical's acquisition of Chase, the bank adopted the venerable Chase brand. What had been Chemical Bank is at the core of what today is JPMorgan Chase. TOSHIBA Mini NB 505-SP0160 Laptop Keyboard Chemical Bank was headquartered in New York City with more than 39,000 employees globally as of the end of 1995. Chemical Bank was the principal operating subsidiary of the Chemical Banking Corporation, a bank holding company. As of the end of 1995, prior to its merger with the Chase Manhattan Bank, Chemical was the third largest bank in the United States in terms of total assets with $182.9 billion of assets. The Chemical Banking Corporation was the fifth largest bank holding company in terms of total assets.[1]TOSHIBA Satellite L505-S5971 Laptop Keyboard Of Chemical's $182.9 billion of total assets, the bank held approximately $82.1 billion of loans, representing a balance between mortgage loans and other consumer loans as well as commercial loans in the U.S. and internationally. Among Chemical's largest international exposure was to Japan, Germany and the United Kingdom. The other assets on the bank's balance sheet included cash as well as various debt and equity securities.[1]SONY Vaio PCG-K23 Laptop Keyboard Chemical reported record net income of $1.8 billion for 1995. Chemical's level of capital at the end of 1995 remained strong, withcapital adequacy ratios well in excess of regulatory requirements. The Corporation's Tier 1 and Total Capital ratios were 8.5% and 12.1%, respectively.[1]COMPAQ Presario C700 Laptop Keyboard Chemical was one of the leading banks in the U.S., active both in corporate banking as well as retail banking. Within retail banking, Chemical provided personal and commercial checking accounts, savings and time deposit accounts, personal loans, consumer financing and mortgage banking as well as trust and estate administration.[1]HP Pavilion dv3-2310ea Laptop Keyboard Chemical's corporate banking business provided a wide variety business loans, leasing, real estate financing, money transfer and cash management among other services.[1] Chemical was among the leading bank lenders to small and medium sized businesses. Chemical also had a significant presence in investment banking as well as underwriting corporate debt and equity securities.[1]SAMSUNG N140 Laptop Keyboard The bank opened its first offices at 216 Broadway in Downtown New York in 1824 at the corner of Ann Street. In 1848 the bank agreed to sell its building to its neighbor Barnum's American Museum (the building collapsed during Barnum's subsequent remodeling) and in 1850 the bank moved into its newly constructed headquarters at 270 Broadway.[2] Chemical bought additional land adjacent its 270 Broadway building in 1879 and 1887 but its offices remained modest through the start of the 20th century. COMPAQ Presario C700 Laptop Keyboard In 1907 the bank constructed a new headquarters on the original and adjacent properties at 270 Broadway. In 1921, Chemical acquired a 13-Storey building belonging to the Shoe & Leather Bank on Broadway, next door to and surrounded by its existing properties.[3] Despite expanding its 1907 headquarters over the years, by the mid-1920s Chemical was in need of additional space to accommodate its growth and reflect its increasing profile. DELL Latitude D620 Laptop Keyboard In 1926, the bank made plans to move again, this time constructing a new six storey location at 165 Broadway, on the corner of Broadway and Cortlandt Street, closer to the Financial District. Chemical moved into its new headquarters in 1928, after completion of the building, and the bank's headquarters would remain at that location for more than five decades.[4]HP Pavilion DV6-1000 Laptop Keyboard Under Chairman Donald Platten, Chemical's headquarters was to move to 277 Park Avenue in 1979.[5][6] The bank moved across Park Avenue in 1991 to occupy the former headquarters of Manufacturers Hanover Corporation at 270 Park Avenue, which is still the headquarters of Chemical's successor, JPMorgan Chase. However, JPMorgan Chase returned to 277 Park Avenue in 2000, following the departure of its previous tenant, Donaldson Lufkin & Jenrette.[7] In 2008, following JPMorgan's acquisition of Bear Stearns, the bank relocated its investment banking groups from Chemical's old headquarters to 383 Madison Avenue.[8]DELL Vostro PP37L Laptop Keyboard The company was founded in 1823 as the New York Chemical Manufacturing Company by Balthazar P. Melick together with the original directors of the company, John C. Morrison, Mark Spenser, Gerardus Post, James Jenkins, William A. Seely and William Stebbins.[9] Additionally, Joseph Sampson, although not a director was among the largest of the original shareholders of the bank.[9] The founders used the manufacturing company, which produced chemicals such as blue vitriol, alum, nitric acid, HP 634139-001 Laptop Keyboard camphorand saltpeter, as well as medicines, paints, and dyes as a means to securing a bank charter from the New York State legislature.[10] During the 1820s, prospective bankers found that they were more likely to be able to successfully secure a charter if the bank were part of a larger business. The following year, in April 1824, the company successfully amended its charter to allow Chemical to begin its banking practice. As a result, Chemical Bank was originally a division of the New York Chemical Manufacturing Company. Balthazar Melick was named the first president of the bank, which catered to merchants in New York City.[11]ACER Aspire 5742 Laptop Keyboard John Mason became a shareholder of the bank in 1826 and would serve as Chemical's second president. Mason, who would later be referred to as "the father of the Chemical Bank," and was one of the richest merchants of his day in New York, succeeded Baltus Melick in 1831.[9] Mason was responsible for establishing the highly conservative business culture of the young bank that would persist for nearly 90 years. For its first twenty-five years, the bank paid no dividends, nor did it pay interest on its customers deposits.[11] DELL Inspiron 1750 Laptop Keyboard Mason was also responsible for leading Chemical through the Panic of 1837. When a speculative bubble collapsed on May 10, 1837, banks suspended payment of gold and silver. Although twenty years later, Chemical would stand alone and continue to make payments in specie, in this crisis the bank followed others in suspending payments. Chemical was one of the earliest to resume payments in specie.[9]HP Pavilion dv3-2310ea laptop keyboard Mason died on September 26, 1839, but his legacy of conservatism was taken on by his successors.[11] Isaac Jones and later his cousin John Quentin Jones would lead Chemical, both serving as president, across the next forty years through 1878. Both Isaac and John Jones had close connections to John Mason, particularly Isaac who married one of John Mason's three daughters. The Mason and Jones families would maintain effective control of Chemical for much of its first five decades.[12] John Q. Jones was succeeded in 1878 by George G. Williams, who had joined the bank in 1842 and served as cashier of the bank from 1855 onward.[13] In that position, Williams was also inculcated in Chemical's conservative style of banking. Williams would serve as president from 1878 through 1903.[9]Packard Bell PEW91 laptop keyboard In 1844, when New York Chemical Manufacturing Company's original charter expired, the chemical company was liquidated and was reincorporated as a bank only, becoming the Chemical Bank of New York in 1844.[11] Among the bank's first directors under its new charter were Cornelius Roosevelt, John D. Wolfe, Isaac Platt and Bradish Johnson, as well as the bank's president John Q. Jones.[9] The company sold all remaining inventories from the chemical division as well as real estate holdings by 1851. TOSHIBA Satellite P500 Laptop Keyboard Two years later, in 1853, Chemical became a charter member of the New York Clearing House, the first and largest bank clearing house in the U.S.[11] Two Chemical presidents would also serve as head of the clearing house, with John Q. Jones serving from 1865–1871 and George G. Williams serving in 1886 and from 1893–1894.[14]HP 636376-001 Laptop Keyboard During the Panic of 1857, Chemical Bank earned the nickname "Old Bullion" by taking a stand that it would continue to redeem its bank notes in specie throughout the crisis. The panic, which had hit banks and caused a number of failures, led banks across the country to suspend specie payments and turn to issuing paper promissory notes.[15][16] HP Pavilion G6-1223TX Laptop Keyboard Chemical's decision was highly unpopular among its fellow banks and led to the bank's temporary suspension from the New York Clearing House, of which Chemical was a charter member.[17] While hundreds of banks closed, including 18 banks in New York in a single day, Chemical developed a reputation for stability. This reputation proved extremely important in Chemical's growth during subsequent recessions during the 1860s. Chemical frequently used the refrain "Good as gold then, good as gold today" in advertisements from the 1860s well into the 20th century.[18]HP G62-264CA Laptop Keyboard Chemical received its national charter as the Chemical National Bank of New York in 1865, at the urging of the secretary of the treasury. This allowed Chemical to issue government-backed national bank notes, the forerunner to paper money. By the early 1870s, Chemical had accumulated deposits in excess of $6 million. ACER Aspire One D150-1920 Laptop Keyboard By the first decade of the 20th century, Chemical had one of the strongest reputations in banking but as a business was in decline, losing accounts each year. Unlike many of its peers, Chemical had been reluctant to expand into securities and other businesses and had not paid interest on bank accounts. Both practices, considered to be highly conservative, had allowed Chemical to develop a large capital reserve but were not attracting customers. William H. Porter, a prominent banker of the era, was named president of the bank in 1903 after the death of the previous president George G. Williams.[13] Porter would leave Chemical seven years later to become a partner at J.P. Morgan & Co. in 1910 and was succeeded by Joseph B. Martindale, who was named president in 1911.[20]ACER Aspire 5610Z Laptop Keyboard In 1917, Chemical named a new president of the bank, Herbert Twitchell,[21] after the death of Joseph B. Martindale. It was uncovered, just months after Martindale's death, that the former Chemical president had stolen as much as $300,000 from the account of Ellen D. Hunt, a niece of Wilson G. Hunt.[22][23]HP Pavilion G6-1223TX Laptop Keyboard Twitchell initiated a major turnaround of Chemical, setting up a trust business and reversing Chemical's policy of not paying interest on cash accounts. These steps along with other initiatives, resulted in an increase in deposits from $35 million to $81 million by 1920.[11][24] In 1920, Twitchell was succeeded by Percy H. Johnston and remained with the bank as chairman of the board.[25] Johnston would hold the presidency of the bank through 1946 at which time the bank had grown to become the seventh largest in the U.S.[26]COMPAQ Presario C700 Laptop Keyboard In 1920, Chemical completed its first major acquisition, merging with Citizens National Bank. The acquisition of Citizens National, a small New York commercial bank, increased Chemical's assets to more than $200 million with more than $140 million of deposits.[24] In 1923 Chemical established its first branch and by the end of the 1920s had opened a dozen branches in Manhattan and Brooklyn as well as a branch in London, its first international presence. ACER Aspire 5742 Laptop Keyboard In 1929, Chemical reincorporated as a state bank in New York as Chemical Bank & Trust Company and merged with the United States Mortgage & Trust Company, headquartered on the Madison Avenue and 74th Street.[27][28] During the Depression-era of the 1930s, Chemical's deposits grew by more than 40% and in 1941, the bank reached $1 billion of assets. During this period, Chemical also established Chemical National Company a securities underwriting business. TOSHIBA Satellite L775D-S7340 Laptop Keyboard In 1947, after the retirement of Percy Johnston, Harold Holmes Helm was named the new president of Chemical and would serve first as president and later as chairman of the bank for the next 18 years until his retirement in 1965. Under Helm, Chemical completed a series of large mergers in the late 1940s and early 1950s that again made the bank among the largest in the U.S.[29] In 1947, Chemical merged with Continental Bank and Trust Company. Then in 1954, Chemical would merge with the Corn Exchange Bank and only five years later merge again with the New York Trust Company. COMPAQ Presario C700 Laptop Keyboard Chemical completed its largest acquisition to that point, in 1954, merging with the Corn Exchange Bank to become the Chemical Corn Exchange Bank. Founded in 1853, the Corn Exchange Bank was based in New York City, but had built a network of branches in other states through the acquisition of community banks.[30] The merger with the Corn Exchange Bank added 98 additional branches to Chemical's system largely in the New York City and $774 million in deposits.[29]SONY VAIO VGN-FS940 laptop keyboard In 1959, the bank, now known as Chemical Corn Exchange Bank, merged with New York Trust Company, effectively doubling the size of the company. New York Trust Company, which had a large trust and wholesale-banking business, specialized in servicing large industrial accounts.[29] At the time of the merger, Chemical Corn was the fourth largest bank in New York and New York Trust was the ninth largest bank and the merger created the third largest bank in New York, and the fourth largest in the U.S. with $3.8 billion of assets.[31] Following the merger, the bank dropped the usage of the "corn exchange" from the corporate name to become the Chemical Bank New York Trust Company. HP Pavilion dv6-2120ec laptop keyboard In 1968, Chemical reorganized itself as a bank holding company which allowed for more rapid expansion.[32] Throughout the early 1960s Chemical had begun to expand into New York's suburbs, opening branches on Long Island and in Westchester County. However by the late 1960s and early 1970s, Chemical was focused on building its international business. In these years, Chemical opened new offices in the Frankfurt, Germany (1969), Zurich, Switzerland (1971), Brussels, Belgium (1971), Paris, France (1971) and Tokyo, Japan (1972). Packard Bell PEW91 laptop keyboard Chemical continued pursuing acquisitions, throughout the 1980s notably its acquisitions of Texas Commerce Bank (1986) andHorizon Bancorp (1986) as well as its attempted takeover of Florida National Bank (1982). Packard Bell Easynote LM85 laptop keyboard Chemical and Florida National Bank agreed, in 1982, to enter into a merger, after laws preventing interstate banking were lifted, giving Chemical an option to acquire the business.[34] In February, 1982, Southeast Banking Corporation (SBC), which had been rebuffed in its attempted to acquire Florida National sued to obtain an injunction against the Chemical merger.[35] HP Pavilion DV7-3173nr laptop keyboard In early 1983, Southeast Banking Corporation dropped its takeover attempt and agreed to exchange their Florida National shares for 24 FNB branch offices and other consideration.[36] Following the deal with SBC, Florida National was cleared to merge with Chemical, however interstate banking acquisitions were still prohibited by Federal law and required state legislative approval.[37] With the 1990 deadline running out for its option to buy Florida National and no sign of state legislative approval, Chemical Bank sold their 4.9% interest to First Union Corporation for $115 million.[38]Packard Bell Easynote LM85 laptop keyboard Chemical completed its largest transaction of the 1980s in December 1986, when the bank agreed to acquire Texas Commerce Bank. The $1.1 billion transaction represented the largest interstate banking merger in U.S. history to that time.[39][40] Texas Commerce, which was officially acquired in May 1987, was one of the largest bank holding companies in the Southwestern U.S., HP G61-465SL laptop keyboard with a strong presence in corporate banking for small and medium sized businesses. Chemical did not seek Federal Deposit Insurance Corporation backing for its acquisition of Texas Commerce although other large Texas banks, First RepublicBank Corporation (Acquired by NationsBank) and MCorp Bank (acquired by Bank One), received over $5 billion of support. Ultimately Chemical contributed $300 million to shore Texas Commerce as it continued to suffer losses.[41][42]COMPAQ Presario CQ40-130TU laptop keyboard Also in 1986, Chemical agreed to a merger with New Jersey-based Horizon Bancorp, although the merger was not completed until 1989, due again to interstate banking rules.[43] The bank's holding company, which had been the Chemical New York Corporation was renamed the Chemical Banking Corporationin 1988 following its series of out of state mergers and acquisitions, including Texas Commerce Bank and Horizon Bancorp.[44]TOSHIBA Satellite P305D-S8995E laptop keyboard It was during this period, in the 1980s and early 1990s, that Chemical emerged as one of the leaders in the financing of leveraged buyout transactions. By the late 1980s, Chemical developed its reputation for financing buyouts, building a syndicated leveraged finance business and related advisory businesses under the auspices of pioneering investment banker, Jimmy Lee.[45][46] It was not until 1993 that Chemical would permission to underwrite corporate bonds, however within a few years, Chemical (and later Chase) became a major underwriter of below-investment-grade debt under Lee. Additionally, in 1984, Chemical launched Chemical Venture Partners to invest in private equity transactions alongside various financial sponsors.[47][48]DELL NSK-DB301 laptop keyboard In July 1991, Chemical announced that it would acquire Manufacturers Hanover Corporation in a $135 billion merger transaction.[49] At the time of the merger, Chemical and Manufacturers Hanover were the sixth and ninth largest banks, respectively, by assets. The transaction, when it closed at the end of 1991, made the combined bank, which retained the Chemical name, the second largest bank in the U.S., behind Citicorp both in terms of assets and customers (approximately 1.2 million household accounts in 1991).[50] Chemical adopted Manufacturers Hanover's logo design and moved into its headquarters at 270 Park Avenue in New York. In corporate banking, Manufacturers Hanover was better established with larger, blue-chip companies, whereas Chemical had been stronger with small- and medium-sized businesses.[33]SONY VAIO VGN-FS640 laptop keyboard Nationally, the combined Chemical bank became one of the largest lenders to U.S. companies and was arguably the leader in loan syndications globally. Additionally, Chemical took a leading role providing foreign exchange, interest rate and currency swaps, corporate finance services, cash management, corporate and institutional trust, trade services and funds transfer. Chemical operated one of the nation's largest bank credit card franchises and was a major originator and servicer of home mortgages.[51]Packard Bell Easynote TM98 laptop keyboard In 1996, Chemical acquired The Chase Manhattan Corporation in a merger valued at $10 billion to create the largest financial institution in the United States. Although Chemical was the acquirer, the bank adopted the Chase brand, which was considered to be better known, particularly internationally. Chase, which had been the largest bank in the U.S. had fallen to sixth, while Chemical was the third largest bank at the time of the merger.[52][53][54][55][56] The merger resulted in the reduction of more than 12,000 jobs between the two banks and merger related expenses of approximately $1.9 billion.[57][58]HP Pavilion G6-1223TX Laptop Keyboard The bank continued to operate under the Chase brand until its acquisition of J.P. Morgan & Co. in December 2000 to form JPMorgan Chase & Co. Throughout all of these acquisitions, Chemical's original management team, led by Walter V. Shipley remained in charge of the bank. When the combined bank purchased J.P. Morgan & Co., William B. Harrison, Jr., who had been a longtime Chemical executive, was named CEO of the combined firm. Additionally, many of Chemical's businesses remaining intact through the various mergers. Chemical's private equity group for example, was renamed multiple times, ultimately becoming JP Morgan Partnersbefore completing a spin-out from the bank, as CCMP Capital, after the bank's 2004 merger with Bank One. ACER Aspire One D150-1920 Laptop Keyboard Chemical was among the pioneers of electronic online banking. On September 2, 1969, Chemical installed the first automated teller machine (ATM) at its branch in Rockville Centre, New York. The first ATMs were designed to dispense a fixed amount of cash when a user inserted a specially coded card.[59] A Chemical Bank advertisement boasted "On Sept. 2 our bank will open at 9:00 and never close again."[60] Chemicals' ATM, initially known as a Docuteller was designed by Donald Wetzel and his company Docutel. Chemical executives were initially hesitant about the electronic banking transition given the high cost of the early machines. Additionally, executives were concerned that customers would resist having machines handling their money.[61]COMPAQ Presario C700 Laptop Keyboard In 1982, Chemical initiated the first personal computer based banking system when it launched a pilot electronic banking program called Pronto.[62] Chemical had spent $20 million to develop the software for Pronto.[62] The system, which worked with the ATARI console, began in New York and served 200 Chemical Bank customers. Pronto was an extension of other electronic banking services offered by Chemical that included a corporate cash-management system and its growing ATM network and was one of the largest early foray by a bank into home computer based banking.[63] However, a year after launching Pronto only 21,000 of Chemical's 1.15 million customers were using the system, in large part due to the high monthly subscription costs that Chemical charged customers to use it.[64] By 1985, it was clear that Pronto, which was heavily promoted by Chemical was growing much slower than anticipated.[65]HP G42-415DX Laptop Keyboard In 1985, Chemical and BankAmerica, another pioneer in electronic banking, entered into a joint venture with AT&T Corporation and Time Inc., known as Covidea, to market banking and discount stock-brokerage services to computer-equipped households.[64] By combining resources and sharing costs, the four firms hope to reduce the risk of large and protracted losses.[66] Eventually Chemical discontinued its efforts in 1989 at a loss of nearly $30 million.[67][68]John Francis McGillicuddy (December 30, 1930 – January 4, 2009) was an American banking industry executive who oversaw the merger between Manufacturers Hanover Trust and Chemical Bank in the early 1990s. DELL NSK-D8001 Laptop Keyboard McGillicuddy played football for Harrison High School (New York) and then attended Princeton University on a football scholarship, playing defensive back on the college's undefeated football teams in 1950 and 1951.[1][2] His roommate at Princeton was fellow football player Dick Kazmaier, who won the Heisman Trophy for 1951. John McGillicuddy later attendedHarvard Law School and was hired by the law firm of Simpson Thacher & Bartlett after serving in the United States Navy.[2]ACER Aspire One D150-1920 Laptop Keyboard He was hired by Manufacturers Trust Company in 1958.[2] He was elected to serve as the bank's president in 1971 at age 40, making him one of the youngest people to run a major banking company, after his predecessor R. E. McNeil, Jr. announced that he would be stepping down.[1][2]Compaq Presario CQ57 Series Laptop Keyboard During New York City's fiscal crisis during the 1970s, McGillicuddy helped organize the financial aid needed to bail out the city. He later played a key role in the late 1970s in the Bailout of Chrysler, working to organize the government loan guarantees that helped that company avoid bankruptcy.[2]SONY VAIO VGN-NW50JB laptop keyboard Melick who was born in Lebanon, New Jersey in 1770, started as an apprentice at a mercantile house at the age of thirteen.[2] In 1792, at the age of twenty-one he was admitted to a partnership and for many years he was a prosperous merchant in Greenwich Village, New York. In 1795, he was listed as a "grocer" doing business at 183 Washington Street.[3][4] Melick founded the commercial house of Melick & Burger, which owned trade vessels sailing in the Caribbean, doing much of its business with the island of St. Croix.[2][3] The firm, which had its offices at 76 Washington Street, owned a ship known as "Chase"[5] which afterwards was prominent in the sugar trade.[2]FUJITSU CP270342-02 laptop keyboard He became a Director in the Equitable Fire Insurance Company, the Greenwich Fire Insurance[6] and the Union Marine and Life Insurance Company.[4] Melick was also a noted member and secretary of the Black Friars Society, also known as the Friary, a music and social club.[3][4] Melick founded the New York Chemical Manufacturing Company, the predecessor of Chemical Bank in 1823 together with John C. Morrison, Mark Spenser, Gerardus Post, James Jenkins, William A. Seely and William Stebbins.[1] Melick and his partners used the manufacturing company, which produced chemicals such as blue vitriol, alum, nitric acid, camphor andsaltpeter, as well as medicines, paints, and dyes as a means to securing a bank charter from the New York State legislature.[7] During the 1820s, prospective bankers found that they were more likely to be able to successfully secure a charter if the bank were part of a larger business. The following year, in April 1824, the company successfully amended its charter to allow Chemical to begin its banking practice. Compaq Presario CQ56-130SY laptop keyboard Melick retired as president of the bank in 1831 in favor of John Mason, one of the richest merchants of his day in New York, and an early shareholder in the bank.[1] Melick, who never married, died shortly thereafter in 1835. Compaq Presario CQ42-173TU laptop keyboard In 1991, as chairman and chief executive of Manufacturers Hanover, McGillicuddy was the chief architect of a merger with the Chemical Banking Corporation that was the largest bank merger in the United States to that time, helping both companies deal with difficulties arising from problem loans in previous years.[2][3] Following the merger, McGillicuddy became the chairman and chief executive of the combined institution, remaining with the bank until his retirement in 1993 when he was to be followed by Walter V. Shipley, who had been the chairman of Chemical.[3]SONY VAIO VGN-FS940 laptop keyboard The merger ushered in a wave of consolidation in the banking industry that continued with Chemical purchasing Chase Manhattan Corporation and assuming that company's name in 1996 and a December 2000 deal with J.P. Morgan & Co. that formed JPMorgan Chase & Co.[2] McGillicuddy served on the boards of organizations and companies including the Boy Scouts of America, Kraft Foods, United Airlines and U.S. Steel.[2] McGillicuddy died at age 78 on January 4, 2009 at his home in Harrison, New York due to complications from prostate cancer.[2] He is interred at Greenwood Union Cemetery, Rye, New York. Compaq Presario CQ42-219AX laptop keyboard CCMP has been known by several names over the past two decades, originally founded as Chemical Venture Partners in 1984, to serve as the private equity and venture capital arm of Chemical Bank. Following Chemical's acquisition of Chase Manhattan Bank in 1996, Chemical adopted the Chase name and Chemical Venture Partners changed its name to Chase Capital Partners. Similarly, following the 2000 acquisition of J.P. Morgan & Co. and the formation of JPMorgan Chase, the group changed its name yet again to JP Morgan Partners. Over this time, the platform grew through its integration of the private equity organizations of Manufacturers Hanover, Chase Manhattan, Hambrecht & Quist, Robert Fleming & Co., The Beacon Group and J.P. Morgan & Co. HP 517865-031 Laptop Keyboard Commercial National Bank (CNB), the earliest forerunner of NationsBank, was formed in 1874. In 1957, Commercial National merged with its longtime rival in Charlotte, American Trust Co.,[2] forming American Commercial Bank. American Commercial changed its name to North Carolina National Bank (NCNB) in 1960 after acquiring Greensboro-based Security National Bank. In the early 70s, it reorganized as the leading subsidiary of NCNB Corporation.  ACER K032130A1 Laptop Keyboard NCNB expanded beyond North Carolina for the first time in 1982, when it purchased Lake City, Florida-based First National Bank of Lake City, its first interstate expansion. Hugh McColl became CEO of NCNB the following year. In 1988, NCNB's assets grew to $60 billion after it bought the failed First RepublicBank Corporation of Dallas, Texas from the FDIC. First RepublicBank Corporation had entered FDIC receivership after filing bankruptcy in March, and was the largest FDIC bank failure in history. HP Pavilion dv6-3047eo Laptop Keyboard By that time, NCNB had become associated with "mergers, acquisitions, expansion, integration". From 1989 to 1992, NCNB acquired over 200 thrifts and community banks, many of these through the Resolution Trust program. Favorable terms, with the FDIC assuming most of the loan portfolios and absorbing mark-to-market losses, allowed NCNB to expand profitably, and a cost-cutting culture improved margins. TOSHIBA 9J.N7482.901 Laptop Keyboard NCNB became NationsBank in 1991 after acquiring Atlanta-based C&S/Sovran Corp. Following the merger, the Bank's assets grew to $118 billion. In July 1992, Nationsbank agreed to invest $200 million in Maryland National Corporation for a 16 percent nonvoting stake and an option to buy the whole company, which it subsequently executed in February 1993. HP Mini 110-1120SL Laptop CPU Cooling Fan In March 1993, NationsBank acquired Chicago Research and Trading Group, expanding into derivatives and dramatically increasing foreign exchange trading. In September 1995, NationsBank announced the acquisition of Bank South Corp for $1.6 billion in stock. The deal gave NationsBank a stronger presence in theAtlanta banking market. [1] ACER Aspire 1660 Series laptop keyboard In 1996, NationsBank acquired St. Louis-based Boatmen's Bancshares for $9.6 billion. The combined bank became the largest in the American south, with assets of $225 billion, and 2,600 branches stretching from North Carolina to New Mexico. The following year, NationsBank acquired Florida's largest bank, Jacksonville-based Barnett Bank, for $15.5 billion, growing the company's total assets to $284 billion. HP Mini 1001TU Laptop Keyboard In June 1997, NationsBank acquired Montgomery Securities in a $1.2 billion transaction. Montgomery was integrated into the firm's existing broker-dealer,NationsBanc Capital Markets, and the combined subsidiary was renamed NationsBanc Montgomery Securities.[3]SONY 148024022 Laptop Keyboard In 1998, it acquired BankAmerica Corporation of San Francisco in what was the largest bank merger in American history at the time. NationsBank was the nominal survivor, and the merged bank was (and still is) headquartered in Charlotte. However, the enlarged bank took the Bank of America name, and operates under BankAmerica's charter. With this merger, all of NationsBank's holdings, including some of the tallest buildings in the nation (like Bank of America Plaza inAtlanta and the Bank of America Corporate Center in Charlotte) took Bank of America's name. BankAmerica's broker-dealer, BancAmerica Robertson Stephens, was integrated into NationsBanc Montgomery Securities, and the combined subsidiary was renamed Banc of America Securities.[4] Headquarters for the new enterprise were established in Charlotte, North Carolina. DELL 454RX Laptop Keyboard In 2004, JPMorgan Chase completed its acquisition of Bank One which had its own in house private equity investment group, One Equity Partners.[3] One Equity, led by Dick Cashin was ultimately designated as the lead private equity platform for JPMorgan Chase at which point JP Morgan Partners formalized plans to spin out of JPMorgan Chase.[4]SAMSUNG NP-N150-JP01 Laptop Keyboard JP Morgan Partners announced the spinout in March 2005 and completed the separation from JPMorgan Chase effective July 31, 2006.[5] The new firm adopted the CCMP acronym in reference to its predecessor entities (i.e., Chemical and Chase and JP Morgan Partners). In April 2006, JPMorgan Chase completed the sale of a $925 million interest in JP Morgan Partners Global Fund to a consortium of secondary investors.[6]HP Mini 210-1014TU Laptop Keyboard The spinout of CCMP came at the same time as the spinouts of private equity groups from other leading investment banks including: Morgan Stanley (Metalmark Capital), Citigroup(Court Square Capital Partners), Deutsche Bank (MidOcean Partners) and Credit Suisse First Boston (Avista Capital Partners, Diamond Castle Holdings). ACER Aspire 5742 Laptop Keyboard In 2007, CCMP completed fundraising for its most recent fund, closing on $3.4 billion in commitments from institutional investors for CCMP Capital Investors II. CCMP Capital Investors II, represented the first fund raised by the CCMP team subsequent to its split from JPMorgan Chase and came in slightly below the original $3.5 billion target that CCMP set for the fundraising. HP Pavilion G6-1223TX Laptop Keyboard First Union Corporation was founded as Union National Bank on June 2, 1908, a small banking desk in the lobby of a Charlotte hotel. by H.M. Victor. The bank merged with First National Bank and Trust Company of Asheville in 1958 to become First Union National Bank of North Carolina.[2] In 1964, the bank added Cameron-Brown company, a mortgage banking and insurance firm.[2]HP 576835-001 Laptop Keyboard First Union Corporation was incorporated in 1967. As part of a corporate reorganization in 1968, a predecessor of First Union National Bank and First Union Mortgage Corporation, the mortgage banking firm acquired in 1964 became subsidiaries of First Union Corp creating the structure the bank utilized until the 2001 merger.  HP Pavilion dv3-2310ea Laptop Keyboard Starting in 1985, with the Supreme Court decision upholding regional interstate banking legislation, First Union focused on an aggressive growth strategy and from 1985 through the merger with Wachovia in 2001, First Union completed over 90 banking-related acquisitions, 50 of which were completed between 1985 and 1995.[3][4] Atlantic National Bank of Jacksonville, Florida merged with First Union in 1985.[5][6]TOSHIBA Satellite l20-101 Laptop Keyboard In February 1986, Cameron-Brown Co., a $10 billion mortgage banker created in 1955 from the merger of Fidelity Bond & Mortgage Co. (started in 1946 in Raleigh) and Brown-Hamel Mortgage Co. of Greensboro, changed its name to First Union Mortgage Corp. to match its parent company.[7]HP Pavilion G7-1081NR Laptop Keyboard In a deal announced in June 1992, First Union acquired South Carolina Federal Corp., making First Union the third largest bank in South Carolina by deposits, but also giving North Carolina-based banks the majority of financial institution assets in South Carolina, something that had never happened in any state since regional banking began in 1986.[8][9] merger in US banking history.[10]HP Pavilion dv3-2310ea Laptop Keyboard CoreStates traced its history to 1781 and the Bank of North America, the first bank chartered in the United States. Once the merger finalized, First Union began to claim 1781 as its founding date. Wachovia still operates The Bank of North America's first branch at Sixth and Chestnut in Philadelphia. This branch opened in 1782 and is now the longest continuously operated branch in America.[11]HP 516884-001 Laptop Keyboard The acquisition of CoreStates brought problems. Many of these arose when First Union attempted to integrate the CoreStates and First Union computer systems too rapidly. Initially, CoreStates’ tellers received insufficient training with the new First Union systems and the two systems were unable to communicate with each other. This led to problems with account access and payments not correctly applied to loans. HP Probook 4510S Laptop Keyboard On April 16, 2001, Charlotte-based First Union Corporation announced it would merge with Winston-Salem based Wachovia Corporation. This was viewed with great surprise by the financial press and security analysts. While Wachovia had been viewed as an acquisition candidate after running into problems with earnings and credit quality in 2000, the suitor shocked analysts as many speculated that Wachovia would be sold to SunTrust.[15]HP Probook 4520S Laptop Keyboard As an important part of the deal, First Union would shed its name and assume the Wachovia identity and stock ticker. Analysts said this move was most likely to help First Union acquire a new identity, as Wachovia's reputation was far better with consumers than First Union. At the same time, Wachovia's name and corporate identity would survive. HP 516884-001 Laptop Keyboard The deal met with skepticism and criticism. Analysts, remembering the problems with the CoreStates acquisition, were concerned First Union's ability to merge with another large company. Winston-Salem's citizens and politicians suffered a blow to their civic pride because Wachovia's corporate headquarters would move to the larger city of Charlotte. City leaders were concerned both by job losses and the loss of stature from losing a major corporate headquarters. First Union was concerned by the potential deposit attrition and customer loss in the city.[16] First Union responded to these concerns by placing the wealth management and Carolinas-region headquarters in Winston-Salem. Compaq Presario CQ57 Series Laptop Keyboard On May 14, 2001, Atlanta-based SunTrust announced a rival takeover bid for Wachovia, the first hostile takeover attempt in the banking sector in many years. In its effort to make the deal appeal to investors, SunTrust argued that it would provide a smoother transition than First Union and offered a higher cash price for Wachovia stock than First Union. SONY V072078AS1 Laptop Keyboard Wachovia's board of directors rejected SunTrust's offer and supported the merger with First Union. SunTrust continued its hostile takeover attempt, leading to a bitter battle over the summer between SunTrust and First Union. Both banks increased their offers for Wachovia, took out newspaper ads, mailed letters to shareholders, and initiated court battles to challenge each other's takeover bids. On August 3, 2001, Wachovia shareholders approved the First Union deal, rejecting SunTrust's attempts to elect a new board of directors for Wachovia and ending SunTrust's hostile takeover attempt.[17] TOSHIBA Satellite L775-S7245 Laptop Keyboard Another issue concerned each bank's credit card division. In April 2001, Wachovia agreed to sell its $8 billion credit card portfolio to Bank One.[18] The cards, which would have still been branded as Wachovia, would have been issued through Bank One's First USA division. First Union sold its credit card portfolio toMBNA in August 2000. After entering into negotiations, the new Wachovia agreed to buy back its portfolio from Bank One in September 2000 and resell it to MBNA. Wachovia paid Bank One a $350 million termination fee.[citation needed]TOSHIBA Satellite P505D-S8934 laptop keyboard On September 4, 2001, First Union and Wachovia formally merged to form the new Wachovia Corporation. In order to prevent a repeat of the CoreStates problems, the new Wachovia phased the conversion of Wachovia computer systems into the First Union systems. The company first began converting systems in the southeast United States, where both banks had branches, before moving to the Northeast, where First Union branches only had to change their signs to reflect the new company name and logo. This process ended on August 18, 2003, almost two years after the merger took place.[19]SONY VAIO PCG-FR395EP laptop keyboard When Wachovia and First Union merged, Charlotte, North Carolina's One, Two, and Three First Union buildings became One, Two, and Three Wachovia Center (respectively), and the 55-story First Union Financial Center in downtown Miami became the Wachovia Financial Center. The merger also affected the names of the indoor professional sports arenas in Philadelphia and Wilkes-Barre, Pennsylvania. Formerly known as the First Union Center and the First Union Spectrum (both Philadelphia) and First Union Arena (Wilkes-Barre), they became the Wachovia Center, Wachovia Spectrum, and Wachovia Arena at Casey Plaza, respectively. In 2010, following Wachovia's merger into Wells Fargo, the Spectrum was demolished and the other venues became the Wells Fargo Center and the Mohegan Sun Arena at Casey Plaza. DELL E141395 laptop keyboard CCMP has been known by several names over the past two decades, originally founded as Chemical Venture Partners in 1984, to serve as the private equity and venture capital arm of Chemical Bank. HP Pavilion G7-1075DX laptop keyboard Following Chemical's acquisition of Chase Manhattan Bank in 1996, Chemical adopted the Chase name and Chemical Venture Partners changed its name to Chase Capital Partners. Similarly, following the 2000 acquisition of J.P. Morgan & Co. and the formation of JPMorgan Chase, the group changed its name yet again to JP Morgan Partners. Over this time, the platform grew through its integration of the private equity organizations of Manufacturers Hanover, Chase Manhattan, Hambrecht & Quist, Robert Fleming & Co., The Beacon Group and J.P. Morgan & Co. HP 640208-001 Laptop Keyboard In 2004, JPMorgan Chase completed its acquisition of Bank One which had its own in house private equity investment group, One Equity Partners.[3] One Equity, led by Dick Cashin was ultimately designated as the lead private equity platform for JPMorgan Chase at which point JP Morgan Partners formalized plans to spin out of JPMorgan Chase.[4]TOSHIBA Satellite L655D-S5095 Laptop Keyboard JP Morgan Partners announced the spinout in March 2005 and completed the separation from JPMorgan Chase effective July 31, 2006.[5] The new firm adopted the CCMP acronym in reference to its predecessor entities (i.e., Chemical and Chase and JP Morgan Partners). In April 2006, JPMorgan Chase completed the sale of a $925 million interest in JP Morgan Partners Global Fund to a consortium of secondary investors.[6]HP Mini 210-1135TU Laptop Keyboard The spinout of CCMP came at the same time as the spinouts of private equity groups from other leading investment banks including: Morgan Stanley (Metalmark Capital), Citigroup(Court Square Capital Partners), Deutsche Bank (MidOcean Partners) and Credit Suisse First Boston (Avista Capital Partners, Diamond Castle Holdings). SAMSUNG NP-N150-JP01 Laptop Keyboard In 2007, CCMP completed fundraising for its most recent fund, closing on $3.4 billion in commitments from institutional investors for CCMP Capital Investors II. CCMP Capital Investors II, represented the first fund raised by the CCMP team subsequent to its split from JPMorgan Chase and came in slightly below the original $3.5 billion target that CCMP set for the fundraising. SAMSUNG N150 Laptop Keyboard The company was established as a box-maker in Rathmines, Dublin in 1934 and was acquired by Mr Jefferson Smurfit in 1938, trading afterwards as Jefferson Smurfit.[2] It was listed on the Irish Stock Exchange in 1964 and acquired a partial interest in Time Industries, a Chicago-based paper and packaging company, in 1974.[3] Jefferson Smurfit grew under the leadership of the founder's son, Sir Michael Smurfit, who became Chief Executive in 1977.[4]HP Pavilion DV6-1104au Laptop Keyboard It merged its 46%-owned US business with Chicago-based Stone Container Corporation to form Smurfit-Stone Container Corporation in 1998.[5] Jefferson Smurfit was the subject of a management buyout financed by Madison Dearborn Partners, Cinven Limited and CVC Capital Partners in 2002.[6] It merged with Kappa Packaging in 2005, changing its name to Smurfit Kappa,[7] and was the subject of an Initial Public Offering in 2007.[8]HP Probook 4515S Laptop Keyboard Samuel Hubbard's Mercantile Exchange Bank eventually became Florida National Bank[1] after Jacksonville's Great Fire of 1901. Millionaire Alfred I. du Pontacquired a major interest in the FNB shortly after moving to Jacksonville in the mid-1920s, but he was unable to gain control until the Great Depression struck in 1929.[2] The FNB stayed solvent throughout the 1930s because du Pont put $15 million of his own money into the institution to cover Bank runs.[3] HP Envy 15 Laptop Keyboard During the early 1930s, six other Florida National Banks were opened throughout Florida, including Lakeland and Bartow; Alfred's wife, Jessie Ball du Pont was named a director of the bank. When Alfred du Pont died in 1935, the du Pont Trust, managed by Ed Ball, Jessie du Pont's brother, continued to control the bank. Growth continued with the acquisition of many more Florida banks over the next two decades and became known as the Florida National Group,[4] which was one of the strongest banks in the state. In size, the branches eventually numbered 185, second only in Florida to Barnett Bank.[5]HP Mini 210-1099TU Laptop Keyboard Ball built the Florida National Bank building at 214 North Hogan Street in Jacksonville in 1961.[citation needed] The structure was constructed using materials which would appreciate in value, such as marble floors and granite exteriors, but excluded items that Ball considered frills.[citation needed] There were no executive washrooms and no hot water faucets in the entire eleven story edifice.[citation needed] The corporate offices of the group were housed in the upper floors and the bank's principal location was on the ground floor. Ed Ball also kept his personal office there for managing the du Pont Trust. After Ball's death, the structure was renamed the Edward Ball Building. ACER TravelMate 3002WTCi Laptop Keyboard Congress forced the du Pont Trust to divest itself of banking interests when they withdrew the trust's 15-year exemption from the Bank Holding Company Act of 1956.[6] The trust sold 34.7% ownership in Florida National Banks to Charter Company in 1971 for $42M, leaving the du Pont Trust with 24.9%, below the legal definition of a bank holding company. The CEO of Charter wasRaymond Mason, a protégé of Ed Ball. Additionally, Ed Ball personally owned 6.4% of FNB and was executor of his sister's estate, which owned 4.5% of FNB.[7]ASUS F3F Laptop Keyboard On July 9, 1973, the Federal Reserve Board issued a preliminary determination that the du Pont Trust had retained enough stock that would allow the trust to continue to exert some control over the bank.[8] Ball was forced to sell the trust's remaining shares and resign as chairman of FNB. However, the du Pont Trust owned a significant block of Charter stock, and the close personal relationship between Mason and Ball still allowed some indirect control. TOSHIBA Satellite U305-S5097 Laptop Keyboard Acquisition Southeast Banking Corporation (SBC), Florida's largest bank holding company, targeted FNB with a takeover bid in 1980, which the FNB board rejected. That same year, a group of foreign investors from Chile, Venezuela, Canada and south Florida sought 40% ownership and control of FNB. FNB filed suit in circuit court and the group was enjoined from acquiring more than 25% of the bank holding company's outstanding shares.[9] However, Florida National revealed in 1981 that it was willing to permit acquisition by Chemical Banking Corporation of New York after laws preventing interstate banking were lifted.[10] At the same time, C.A. Cavendes Sociedad Financiera, a Venezuelan investment company, announced that it had acquired 24.99 percent of the common stock of Florida National. HP Mini 210-2010ee Laptop Keyboard In February, 19

82, SBC sued to obtain an injunction against the merger in Federal court, citing contrary banking laws in both Federal and Florida codes.[11]Florida National Bank countered with an antitrust suit against SBC. It was FNB's contention that if SBC were allowed to complete the takeover, commercial banking competition would be unlawfully reduced.[12] ACER TravelMate 2350 Laptop Keyboard In early 1983, Southeast Banking Corporation dropped its takeover attempt and agreed to exchange their 1.73 million FNB shares for 24 FNB branch offices, $5.7M in cash, a downtown Miami real estate parcel and other assets.[13] This was during the time when Charter was going through a bankruptcy. The Federal Reserve Board approved a revised merger plan between FNB and Chemical Bank in 1984. However, at the time, interstate banking acquisitions were prohibited by Federal law and required state legislative approval.[14] HP Mini 110-1120SL Laptop CPU Cooling Fan With the 1990 deadline running out for its option to buy FNB and no sign of state legislative approval, Chemical Bank sold their 4.9% interest to First Union for $115 million.[5] On March 7, 1989, it was revealed that Florida National Banks was to be acquired by Charlotte, North Carolina's First Union Corporation.[5] The transaction, valued at $849 million,[5] was consummated the following year. Packard Bell PEW91 laptop keyboard The Texas Commerce Bank (officially Texas Commerce Bank N.A.[1], with its parent bank holding company known as Texas Commerce Bancshares, Inc.) was a Texas-based bank acquired by Chemical Banking Corporation of New York in May 1987. The acquisition of Texas Commerce Bank represented the largest interstate banking merger in history at the time with a purchase price of $1.2 billion.[citation needed] The bank had its headquarters in what is now the JPMorgan Chase Building (formerly Gulf Building) in Downtown Houston, Texas.[2]SONY VAIO VGN-FS730 laptop keyboard Prior to the merger, interstate banking was illegal in Texas and many other states,[3] which effectively prevented such cross-border mergers. Texas and New York had changed their laws to allow a merger of an in-state bank and an out-of-state bank. Without those changes to the law, the merger between Chemical Bank and Texas Commerce Bank, and later Chase Manhattan Bank would not have been possible.[4]SONY VAIO VGN-N110E laptop keyboard ACER Aspire 5710Z laptop keyboard Through a series of mergers and acquisitions Chemical Bank bought Chase Manhattan Bank and then JP Morgan finally changed Texas Commerce to JPMorgan Chase & Co. The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation operating as an independent agency created by the Banking Act of 1933. As of January 2013, it provides deposit insuranceguaranteeing the safety of a depositor's accounts in member banks up to $250,000 for each deposit ownership category in each insured bank. As of September 30, 2012, the FDIC insured deposits at 7,181 institutions.[2] The FDIC also examines and supervises certain financial institutions for safety and soundness, performs certain consumer-protection functions, and manages banks in receiverships (failed banks). The FDIC receives no Congressional appropriations – it is funded by premiums that banks and thrift institutions pay for deposit insurance coverage and from earnings on investments in U.S. Treasury securities. Packard Bell NEW95 laptop keyboard The FDIC does not provide deposit insurance for credit unions, which are insured by the National Credit Union Administration (NCUA). Insured institutions are required to place signs at their place of business stating that "deposits are backed by the full faith and credit of the United States Government."[3] Since the start of FDIC insurance on January 1, 1934, no depositor has lost any insured funds as a result of a failure.[4]SONY VAIO VGN-FS940 laptop keyboard The Texas Commerce Bank traces its roots to 1866. Texas Commerce changed its name to Chase Bank of Texas in 1998 and merged into The Chase Manhattan Bank in 2000.[5] In 1977, Lady Bird (Claudia Taylor) Johnson (wife of President Lyndon Baines Johnson) became a director of Texas Commerce Bank and Texas Commerce Bancshares in Houston. Other directors were former President Gerald R. Ford, Jr., former U.S. Representative Barbara Jordan and the Odessa oil industrialist Bill Noël. At one time Ken Lay of Enron was a director. Past presidents of the bank include Thomas E. Locke of Lubbock. HP 636376-001 Laptop Keyboard Jeb Bush's career started with an entry level position in the international division of the Texas Commerce Bank, a job he received through James A. Baker, III, a longtime family friend and chairman of the board. Bush assisted in drafting communications for the company's chairman, Ben Love. In November 1977 he was sent to the Venezuelan capital of Caracas to open a new operation for the bank. Bush spent about two years there, working in international finance. He eventually worked for the bank's executive program. HP Envy 15 Laptop Keyboard Federal deposit insurance received its first large-scale test since the Great Depression in the late 1980s and early 1990s during the savings and loan crisis(which also affected commercial banks and savings banks). The brunt of the crisis fell upon a parallel deposit insurer, the Federal Savings and Loan Insurance Corporation (FSLIC), created to insure savings and loan(S&L) institutions (S&Ls, also called thrifts). Due to a confluence of events, much of the S&L industry was insolvent, and many large banks were in trouble as well. The FSLIC became insolvent and was abolished in August 1989. It was replaced by the Resolution Trust Corporation (RTC). On December 31, 1995, the RTC was merged into the FDIC, DELL NSK-DCK01 Laptop Keyboard and the FDIC became responsible for resolving failed thrifts. Supervision of thrifts became the responsibility of a new agency, the Office of Thrift Supervision. (Credit unions remained insured by the National Credit Union Administration.) The primary legislative responses to the crisis were theFinancial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), and Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA). Thrifts are now regulated by the OCC. DELL Precision M4500 Laptop Keyboard important because former regulators say that this is the level that can wipe out a bank’s equity and threaten its survival. While this ratio does not always lead to bank failures if the banks in question have raised additional capital and have properly established reserves for the bad debt, it is an important indicator for future FDIC activity.[14]SONY VAIO VGN-FS715F Laptop Keyboard On August 21, 2009, Guaranty Bank, in Texas, became insolvent and was taken over by BBVA Compass, the U.S. division of Banco Bilbao Vizcaya Argentaria, the second-largest bank in Spain. This was the first foreign company to buy a failed bank during the credit crisis of 2008 and 2009. In, addition, the FDIC agreed to share losses with BBVA on about $11 billion of Guaranty Bank’s loans and other assets.[15] This transaction alone cost the FDIC Deposit Insurance Fund $3 billion. HP Pavilion G60-230 Laptop Keyboard On August 27, 2009, the FDIC increased the number of troubled banks to 416 in the second quarter. That number compares to 305 just three months earlier.[16] At the end of the third quarter, that number jumped to 552.[17] At the close of 2009, a total of 140 banks had become insolvent.[18] This is the largest number of bank failures in a year since 1992, when 179 institutions failed.[19]HP Pavilion DV7-3065dx Laptop Keyboard As a result of the financial crisis in 2008, twenty-five U.S. banks became insolvent and were by their respective chartering authority.[11] However, during that year, the largest bank failure in terms of dollar value occurred on September 26, 2008, when Washington Mutual, with $307 billion in assets, experienced a 10-day bank run on its deposits. ACER Aspire 5610Z Laptop Keyboard Between 1989 and 2006, there were two separate FDIC funds — the Bank Insurance Fund (BIF), and the Savings Association Insurance Fund (SAIF). The latter was established after the savings and loans crisis of the 1980s. The existence of two separate funds for the same purpose led to banks’ attempting to shift from one fund to another, depending on the benefits each could provide. In the 1990s, SAIF premiums were, at one point, five times higher than BIF premiums; several banks attempted to qualify for the BIF, HP COMPAQ NX6325 Laptop Keyboard with some merging with institutions qualified for the BIF to avoid the higher premiums of the SAIF. This drove up the BIF premiums as well, resulting in a situation where both funds were charging higher premiums than necessary.[22]HP Mini 210-1072TU Laptop Keyboard Then Chairman of the Federal Reserve Alan Greenspan was a critic of the system, saying, “We are, in effect, attempting to use government to enforce two different prices for the same item – namely, government-mandated deposit insurance. Such price differences only create efforts by market participants to arbitrage the difference.” Greenspan proposed “to end this game and merge SAIF and BIF”.[23]HP 636376-001 Laptop Keyboard In February 2006, President George W. Bush signed into law the Federal Deposit Insurance Reform Act of 2005 (FDIRA) and a related conforming amendments act. The FDIRA contains technical and conforming changes to implement deposit insurance reform, as well as a number of study and survey requirements. Among the highlights of this law was merging the Bank Insurance Fund (BIF) and the Savings Association Insurance Fund (SAIF) into a new fund, the Deposit Insurance Fund (DIF). This change was made effective March 31, 2006. The FDIC maintains the DIF by assessing depository institutions an insurance premium. The amount each institution is assessed is based both on the balance of insured deposits as well as on the degree of risk the institution poses to the insurance fund. HP 508112-001 Laptop Keyboard Bank failures typically represent a cost to the DIF because the FDIC, as receiver of the failed institution, must liquidate assets that have declined substantially in value while, at the same time, making good on the institution’s deposit obligations. A March 2008 memorandum to the FDIC board of directors shows a 2007 year-end Deposit Insurance Fund balance of about $52.4 billion, which represented a reserve ratio of 1.22% of its exposure to insured deposits, totaling about $4.29 trillion. The 2008 year-end insured deposits were projected to reach about $4.42 trillion with the reserve growing to $55.2 billion, a ratio of 1.25%.[24] As of June 2008, the DIF had a balance of $45.2 billion.[25] However, 9 months later, in March, 2009, the DIF fell to $13 billion.[26] HP Pavilion dv6-2132ec Laptop Keyboard That was the lowest total since September, 1993[26] and represented a reserve ratio of 0.27% of its exposure to insured deposits totaling about $4.83 trillion.[27] In the second quarter of 2009, the FDIC imposed an emergency fee aimed at raising $5.6 billion to replenish the DIF.[28] However, Saxo Bank Research reported that, after Aug 7, further bank failures had reduced the DIF balance to $648.1 million.[29] FDIC-estimated costs of assuming additional failed banks on Aug 14 exceeded that amount.[citation needed] SONY VAIO VGN-NW130D Laptop Keyboard The FDIC announced its intent, on September 29, 2009, to assess the banks, in advance, for three years’ of premiums in an effort to avoid DIF insolvency. The FDIC revised its estimated costs of bank failures to about $100 billion over the next four years, an increase of $30 billion from the $70 billion estimate of earlier in 2009. The FDIC board voted to require insured banks to prepay $45 billion in premiums to replenish the fund. News media reported that the prepayment move would be inadequate to assure the financial stability of the FDIC insurance fund.  HP Pavilion G6-1223TX Laptop Keyboard DELL Inspiron 510m Laptop Keyboard The FDIC elected to request the prepayment so that the banks could recognize the expense over three years, instead of drawing down banks’ statutory capital abruptly, at the time of the assessment.[30] The fund is mandated by law to keep a balance equivalent to 1.15 percent of insured deposits.[30]As of June 30, 2008, the insured banks held approximately $7,025 billion in total deposits, though not all of those are insured.[31] As of September 30, 2012, total deposits at FDIC-insured institutions totaled roughly $10.54 trillion, although not all deposits are insured.[32] HP Envy 15 Laptop Keyboard The DIF's reserves are not the only cash resources available to the FDIC: in addition to the $18 billion in the DIF as of June, 2010;[33] the FDIC has $19 billion of cash and U.S. Treasury securities held as of June, 2010[33] and has the ability to borrow up to $500 billion from the Treasury. The FDIC can also demand special assessments from banks as it did in the second quarter of 2009.[34][35]HP Pavilion dv6-3178ee Laptop Keyboard HP Pavilion dv6-3047eo Laptop Keyboard TOSHIBA Satellite A305 Laptop Keyboard

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