Magazine article American Banker


Magazine article American Banker


Article excerpt

Just Say No

Wachovia Corp. chief Ken Thompson this week took a polite poke at a Charlotte neighbor, Bank of America Corp.'s Ken Lewis.

B of A's $47 billion deal for FleetBoston Financial Corp., announced at the end of October, has caused a flurry of speculation over whether other bank deals might follow. Shares of Wachovia, viewed as a potential buyer, have declined, as have the stocks of other banks rumored to be on the lookout for deals. Observers worry that other big deals might come at eye-popping premiums like the 43% B of A offered Fleet shareholders.

But Mr. Thompson insisted he would avoid big, pricey deals and stick with smaller, economical ones that add to earnings quickly.

"We want you to hold us accountable for what we have done, not for what other people have done," he said Tuesday at Goldman Sachs Group Inc.'s 14th annual Bank CEO Conference in New York.

Since becoming the chairman and chief executive in 2000, when his company was known as First Union Corp., Mr. Thompson has made only two major deals. He paid a relatively small 6% premium in 2001 to buy the old Wachovia, of Winston-Salem, N.C. This summer, he formed a brokerage joint venture with Prudential Securities that required no up-front payment.

Lori Appelbaum, a Goldman analyst, asked how a company the size of Wachovia can hope to stay disciplined on acquisitions while pursuing a national strategy.

"It's exactly like you teach your children. You've just got to be willing to say no," Mr. …

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