Chapter 1326: Chapter 453: The Three Most Famous Men in Los Angeles (Part 2)
But Amadei Giannini was very confident that in his bank, small business owners and farmers could obtain low-interest loans of 25 US Dollars without any collateral.
This was a very visionary strategy at the time, as common folk often struggled to borrow money for starting a business or investing in agricultural production, leaving them helpless. Amadei Giannini remembered well the lesson of how his father had suffered tragedy over just 1 US Dollar. He frequently visited farmers door to door, persuading them to deposit their money into his bank.
Undoubtedly, his approach supported farmers and small business owners, who, once they made money, would become loyal depositors of the Italian Bank—people generally have this sense of gratitude.
Amadei Giannini’s foresight was precisely reflected here.
In the morning of April 18, 1906, a world-shocking earthquake occurred in San Francisco.
Due to its suddenness, the earthquake caused devastating consequences, but fortunately, the location of the Italian Bank did not suffer significant damage. Facing the devastation, Amadei Giannini personally oversaw the transfer of 80,000 US Dollars in cash from the bank to a safe location. This successful transfer laid a good foundation for the bank to resume business after the disaster.
Two days later, major newspapers jointly initiated discussions on post-disaster reconstruction work.
Disregarding his low status, Amadei Giannini attended this emergency meeting.
At the time, all the attending businessmen demanded loans from the banks, but for their own safety, the banks were unwilling to do so, leading to intense arguments. Suddenly, Amadei Giannini stood up and said, “I am Giannini of the Italian Bank, and we will officially open tomorrow! And it will be outdoor banking!” His words shocked the audience, and everyone could hardly believe their eyes and ears.
On April 22, four days after the great disaster, newspapers published large advertisements: “The Italian Bank is officially open, business as usual, outdoors, and not threatened by the earthquake!” Unexpectedly, more people came to deposit money than to withdraw, because in light of the fires caused by the earthquake, people believed it was safer to keep money in the bank.
This move made those bankers, who refused to open their doors, very regretful.
Through this event, the Italian Bank developed from a small bank to a well-known large bank.
From 1903-1907, the United States experienced the most severe economic crisis in history.
The economic crisis spread rapidly like a plague, causing panic among people, with depositors rushing to withdraw their savings, forming an unstoppable avalanche.
Although the situation in California was not as severe as elsewhere, due to the overall climate, the situation was also inevitably precarious.
Having luckily escaped this crisis, Amadei Giannini was astonished to discover that only one bank in San Francisco was unaffected, which was the Canadian Bank.
For this reason, he made a special trip to investigate and discovered the secret: the Canadian Bank had branches across the country, forming a network that collected deposits from all over the nation and concentrated them at the headquarters, thus giving the bank great flexibility and control.
This was very different from the financial system in the United States at the time.
At the time, local banks in the United States concentrated their gold at large Wall Street banks.
Once a crisis occurred on Wall Street, local banks inevitably lost their security.
Amadei Giannini had an epiphany: it was essential to have one’s own branch network!
Subsequently, he embarked on a great endeavor: gradually acquiring and merging some poorly managed local banks.
The first to be merged was a usurious bank in San Noe, Giannini’s hometown.
Although American law prohibited a single bank from acquiring shares of another peer bank, the law had loopholes. He only needed to buy the small shares except for the leading family, and if the total shares exceeded half, the acquisition and merger would be legal.
As for such poorly managed banks, small shareholders were eager to sell their shares. Hence, Giannini’s acquisitions were very smooth.
In 1910, Amadei Giannini also acquired the San Francisco Bank and the San Francisco Mechanics Bank, and shortly thereafter, he successfully acquired the San Mateo Bank.
But these were not Giannini’s real goals; his target was Los Angeles.
In 1913, when Giannini came to Los Angeles, planning to continue acquiring another soon-to-bankrupt United Bank, he encountered opposition from some local banks.
The local newspaper ran headlines like “Resist Italy’s Invasion.”
The clever Giannini took countermeasures and ran a full-page advertisement in the newspaper the next day: “Poor Italy lends money to the poor petty citizens and workers. Italy is a friend of the poor.”
At that time, Italy was indeed a poor country, with as many as 870,000 people emigrating overseas. Simultaneously, he published his advertisement in seven languages, targeting ordinary Californians and immigrants as his audience.
Once again, the facts proved the correctness of his policy of targeting citizens as main customers.
By 1918, the Italian Bank’s branches in California had grown to 24, becoming the largest branch banking system in the nation.
In the summer of 1928, exhausted by years of hard work, Giannini left the tumultuous Wall Street in New York and returned to his picturesque hometown of Milan, Italy, to recuperate.
At this time, the head of the Italian Bank became Amadei Giannini’s daughter and only child, Crea Giannini, who took charge.
However, simultaneously, Amadei Giannini’s nephew, Ham Giannini, also held an important position in the Italian Bank.