Wachovia Bank of Georgia, N.A.

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Wachovia Bank of Georgia, N.A.

191 Peachtree Street, N.E.
Atlanta, Georgia 30303
(404) 332-5000
Fax: (404) 332-5919

Wholly Owned Subsidiary of Wachovia Corporation
1929 as the First National Bank of Atlanta
Assets: $8 Billion (1995 est.)
Employees: 730
SICs: 6712 Bank Holding Companies; 6021 National Commercial Banks

A leader in Southern banking, Wachovia Bank of Georgia, N.A. is one of the three banks that constitute the Wachovia Corporation, along with the Wachovia Banks of North and South Carolina. Wachovia Bank of Georgia, the pre-eminent bank within the Peanut State, was one of the countrys early leaders in providing highly sophisticated cash management services to businesses and corporations throughout the southern part of the United States, including such technologies as automated lockbox centers to process receivables. Wachovia Bank of Georgia was the first bank holding company in the state to list its stock on the New York Stock Exchange, and was in the vanguard of American banks that encouraged and assisted domestic companies with the growing volume of international trade during the 1960s and 1970s. As a subsidiary of Wachovia Corporation since 1985, the banks asset base continues to grow at an impressive rate.

Following the Fortunes of the South

The beginning of the most important bank in the state of Georgia was tied to the fortunes and talents of Alfred Austell, a native of East Tennessee born in 1814. Raised on a farm and taught in a field school, Austell worked his way to Atlanta, Georgia, where he worked in various businesses as clerk and cashier, and as a planter. As a successful businessman, Brigadier General of the Georgia Militia, and a civic leader, he established the Bank of Fulton, and worked as its cashier. The bank soon garnered a reputation as one of the most trustworthy financial institutions within the state.

Unfortunately, with the advent of the Civil War in 1861 the city of Atlanta, along with all its financial institutions, fell on hard times. At the time of Georgias secession from the United States in January of 1861, Atlanta was one of the most illustrious and charming cities in the nation. As the cornerstone of the Confederate war efforts, Atlanta became the target of the Union armys wrath and was in ruins by the end of the war. The Bank of Fulton, having dealt in Confederate currency during the war, was left insolvent by the demise of the Confederacy.

Despite these setbacks, Alfred Austell was determined to use his own personal resources to redeem every one of the banks Confederate notes held by loyal customers. Austell reimbursed all the banks customers in gold and then, with his fortune depleted, headed north to New York to explore the possibilities of revitalizing the financial community in Atlanta. Using his network of Northern contacts, Austell was able to procure a federal charter for a bank that he named the Atlanta National Bank. The first such national bank in the Southeast, the Atlanta National Bank opened for business on December 19, 1865, in Austells home. Capitalized at $100,000, and with Austell as president, the new bank grew quickly. Within eight months, the bank had moved to permanent offices on Alabama Street in the heart of downtown Atlanta, had gained more than $300,000 in new deposits, and had made loans surpassing $100,000. After its first full year in operation, the Atlanta National Bank was operating at a profit.

By the time Alfred Austell died in 1881, the Atlanta National Bank had developed into one of the premier financial institutions in the state of Georgia. The bank had loaned the city of Atlanta funds for reconstruction activities, and continued to do so throughout the remainder of the 19th century. As the city grew, the bank issued bonds to fund public services such as street construction, school building, water supply, and the creation of fire and police departments. Atlanta National Bank was also one of the first banks in the South to provide its customers with individual bank accounts where checks could be written in order to draw on their deposits.

The 20th Century

By the turn of the century, the Atlanta National Bank was one of the most successful and most stable in the entire South. Largely due to its financial stability, the bank was able to take advantage of the Panic of 1903 and purchase some of its local competitors, such as the Capital City National Bank. As a federally chartered national bank, Atlanta National Bank was required to become a member of the regional Federal Reserve Bank, created by the Federal Reserve Act of 1913. This federal legislation required member banks to keep a portion of their reserves on deposit with the local Federal Reserve Bank, and allowed the member bank to borrow from the pool of money collected. Atlanta National Bank again capitalized on this opportunity to expand its activities by acquiring some smaller banks and enlarging its offices. During the First World War, the bank was highly successful in promoting the purchase of Liberty Bonds to finance the American military effort in Europe.

State law prohibited Georgia banks from expanding their services through branch banking outside the city limits within which they originally operated. The only other method to expand their presence in communities and towns other than their own was to pursue a strategy of merger and acquisition. Thus in 1916, Atlanta National Bank merged with American National Bank, and in 1923 Atlanta National merged with the Lowry Bank and Trust Company of Georgia. In 1929, the mergers were brought to their culmination when Atlanta National Bank merged with the Fourth National Bank, also located in Atlanta. The merger created the largest bank in Georgia and the oldest national bank in the southeastern section of the United States. With approximately $58 million in assets, the newly formed First National Bank of Atlanta was the largest financial institution south of Philadelphia, Pennsylvania, and ranked among the top 15 in the nation.

The Great Depression and World War II

By the time Franklin Delano Roosevelt was sworn in as president of the United States on March 4, 1933, the Depression was in full force across the country. The Stock Market crash of 1929 brought with it widespread panic in financial circles, and many banks were forced into bankruptcy when they were unable to meet the demand to return the deposits of their customers. Upon assuming office, Roosevelt declared a national Bank Holiday which closed all American banks. With the passage of the Emergency Banking Bill less than one week after his inauguration, banks were subjected to strict financial guidelines before they could reopen. First National Bank of Atlanta was one of the first banks in the South to reopen for business after the Bank Holidays.

Through its conservative investment policies and astute financial management, First National Bank of Atlanta weathered the difficult years of the Great Depression. By the end of the 1930s, the bank had regained its depositors and had implemented new loan programs that stabilized the finances of many commercial firms in the city. When America entered World War II in December of 1941, the revitalization of industry required to sustain the war effort did more than anything else to lift the country out of the Great Depression. First National Bank of Atlanta was at the forefront of mobilizing all its resources to support Americas involvement in World War II. The bank assumed a leading role in financing those companies in the South that retooled their manufacturing facilities to produce ammunition, and also provided many loans to textile firms making clothing for soldiers serving overseas. The U.S. Treasury Department requested banks to join its campaign selling war bonds in order to finance the massive expenditures required by the American military effort, and First National Bank of Atlanta responded enthusiastically. Setting an example, the bank purchased many war bonds and, by the end of the war in 1945, was one of the banks whose commercial assets were mostly in the form of government bonds.

Postwar Years

When U.S. soldiers returned home from the battlegrounds of World War II, First National Bank of Atlanta was ready to meet their needs as consumers. As the demand for housing, automobiles, appliances, and other consumer goods increased, the bank established such services as installment loans for the purchase of a wide variety of items. With a new emphasis on corporate lending, the bank initiated a program designed to provide companies in the Southeast with the capital required to convert their manufacturing facilities from wartime to peacetime production. Continuing a practice established at the turn of the century, First National Bank of Atlanta also financed the construction of schools and local roads by issuing bonds. One of the most important services that the bank provided during the 1950s involved retirement plans set up for elderly citizens through the trust department. From 1945 to 1960, the number of employees belonging to their companys private pension plan more than tripled, and the First National Bank of Atlanta provided consulting services to individuals and companies seeking advice on pension management and investments.

The decade of the 1960s was one of the most prosperous periods for First National Bank. During the early part of the decade, the bank established an international department to assist domestic companies in the Southeast that wished to expand their presence in Europe and Asia. Although the banks deposits began to decline, its mortgage lending program and loans to small and mid-sized companies brought in significant revenue. In 1965, First National Bank of Atlanta began construction on a 41-story headquarters tower, one of the most impressive of the new buildings that adorned downtown Atlanta. In 1969, the banks management decided to form First National Holding Corporation, a holding company for its banking operations, in order to take advantage of the many benefits involved in such a reorganization.

Expansion and Consolidation

During the 1970s, First National opened its first foreign office in London, and implemented a strategic policy to expand its presence overseas. When the state of Georgia relaxed its requirements for banks to open branch offices, First National immediately initiated an aggressive acquisitions policy and acquired 13 banks during the mid- and late 1970s, including the prominent First Bank of Savannah. Through these acquisitions, First National rapidly extended its services to 17 counties throughout the state of Georgia. In 1978, the bank was one of the first in the South to support the Community Reinvestment Act, legislation passed by the U.S. Congress which detailed the financial responsibilities of banks to serve the needs of lower-income communities and neighborhoods. In 1979, the bank renamed itself the First Atlanta Corporation.

First Atlanta was a leader in innovative banking technology. The banks tape-driven computers were replaced rapidly by electronic computers; its automated teller machine, Tillie The All-Time Teller, was one of the first in use throughout the South; and the electronic transfer of funds and point-of-sale devices were welcomed by an enlightened management that wanted to increase the convenience of the banks customer services. These new developments in technology allowed First Atlanta to expand its overseas network of offices and simultaneously concentrate on new and increasing domestic opportunities such as corporate business lending and development, mortgage lending, and the burgeoning field of credit card operations.

Yet even with such a bright future, management at First Atlanta arrived at the conclusion that the bank would be better prepared for the competition of the future if it merged with another large banking institution. In the mid-1980s, First Atlanta entered into merger negotiations with Wachovia Bank Corporation, located in North Carolina. Having already rejected another offer from a southeastern bank, management at First Atlanta felt that Wachovia was the perfect match. Throughout the late 1980s, teams were set up by both banks to plan, arrange, and implement the consolidation of the separate operations and staff.

The 1990s and Beyond

By 1993, the merger between First Atlanta and Wachovia had been completed. Joined by South Carolina National Corporation, the three banks formed one of the largest and most impressive financial institutions in the United States. By 1994, total assets had doubled to $36 billion, deposits had climbed from $12 billion to $23 billion, and trust assets had increased from $38 billion to $92 billion. Under the Wachovia name, new offices were opened in London, Tokyo, New York City, and Chicago, and an extensive network of new branch offices in the Southeast was in the planning stage. To reflect its involvement with and commitment to its new partners, First Atlanta decided to adopt the Wachovia logo and change its name to Wachovia Bank of Georgia, N.A.

Principal Subsidiaries

First Bank Building Corporation; First Atlanta Services Corporation; Wachovia Auto Leasing Company of Georgia; WMCS, Inc.

Further Reading

Bronstein, Barbara, Big Georgia Banks Win Branching Battle, American Banker, January 30, 1996, p. 7.

Gordon, Noel, Homes for Orphans, The Banker, January 1996, p. 3A.

Harker, Patrick J., and Kathleen C. McClave, Inconsistent Decisions Undermine Value of Technology Spending, American Banker, February 7, 1996, p. 14.

A History of Banking And Wachovia, Winston-Salem, N.C.: Wachovia Corporation, 1994.

Moore, Michael, Wachovia Doubling Its Staff for Branch Fund Sales, American Banker, January 10, 1996, p. 4.

Rhoads, Christopher, Georgia Regulator Comes Out for Intrastate Branching, American Banker, December 22, 1995, p. 6.

Tracey, Brian, Reopening the Door to Outsourcing: Eased Rules on Subsidiary Operations May Bring Banks Back, American Banker, December 27, 1994, p. 15.

Thomas Derdak