Security Pacific National Bank (SPNB) was a large
USThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
bankA bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
headquartered in
Los AngelesLos Angeles , with a population at the 2010 United States Census of 3,792,621, is the most populous city in California, USA and the second most populous in the United States, after New York City. It has an area of , and is located in Southern California...
,
CaliforniaCalifornia is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
. In 1992
Bank of AmericaBank of America Corporation, an American multinational banking and financial services corporation, is the second largest bank holding company in the United States by assets, and the fourth largest bank in the U.S. by market capitalization. The bank is headquartered in Charlotte, North Carolina...
acquired SPNB.
History
On September 1, 1868, Hellman, Temple and Co. opened in the then small town of Los Angeles. The banking firm was the predecessor of Farmers and Merchants Bank (1870), which was the predecessor of Security First National Bank. The bank earned a reputation for aggressive and creative business practices and benefited from economic and population growth in the
Western United States.The Western United States, commonly referred to as the American West or simply "the West," traditionally refers to the region comprising the westernmost states of the United States. Because the U.S. expanded westward after its founding, the meaning of the West has evolved over time...
. By the mid-20th century it had an international presence, and was ranked the fifth-largest
bankA bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
in the
United StatesThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
and third-largest in
CaliforniaCalifornia is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
in terms of deposits.
In 1967, Security First National Bank bought Pacific National Bank and became Security Pacific National Bank.
In 1971, SPNB Security Pacific National Bank (SPNB) buys 69% of
Bank of CantonBank of Canton was the first Chinese-owned bank in Hong Kong. At the time, all the other banks in Hong Kong were foreign, primarily British, including the locally incorporated but British-run Hongkong and Shanghai Banking Corporation....
.
In 1975, Security Pacific Bank constructed a 55-story tower in downtown Los Angeles, now known as
Bank of America PlazaBank of America Plaza, formerly Security Pacific Plaza, is a 55 story class-A office skyscraper in Los Angeles, California. It was completed in 1974 with the headquarters of Security Pacific National Bank, and Sheppard, Mullin, Richter & Hampton as its main tenants...
.
In 1978, computer consultant Stanley Rifkin learned the electronic codes Security Pacific used to telegraph funds to other banks. On October 25 he stole $10,200,000 from a non-existent account, executing one of the largest
bank robberiesBank robbery is the crime of stealing from a bank during opening hours. According to the Federal Bureau of Investigation's Uniform Crime Reporting Program, robbery is "the taking or attempting to take anything of value from the care, custody, or control of a person or persons by force or threat of...
in history. He used the funds to buy some 115,000
RussiaRussia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
n
diamondIn mineralogy, diamond is an allotrope of carbon, where the carbon atoms are arranged in a variation of the face-centered cubic crystal structure called a diamond lattice. Diamond is less stable than graphite, but the conversion rate from diamond to graphite is negligible at ambient conditions...
s in
SwitzerlandSwitzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
, which he smuggled back into the
United StatesThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
and attempted to sell, but he was captured. Security Pacific took ownership of the diamonds but received few offers for such a large quantity. Eventually it was forced to sell them on unfavorable terms to a
LiechtensteinThe Principality of Liechtenstein is a doubly landlocked alpine country in Central Europe, bordered by Switzerland to the west and south and by Austria to the east. Its area is just over , and it has an estimated population of 35,000. Its capital is Vaduz. The biggest town is Schaan...
firm affiliated with the
De BeersDe Beers is a family of companies that dominate the diamond, diamond mining, diamond trading and industrial diamond manufacturing sectors. De Beers is active in every category of industrial diamond mining: open-pit, underground, large-scale alluvial, coastal and deep sea...
company.
On May 9, 1980, five men robbed the Security Pacific branch in
Norco, CaliforniaNorco is a city in Riverside County, California, in the United States. As of the 2010 census, the city population was 27,063, up from 24,157 at the 2000 census...
. They were among the most heavily armed bank robbers in history, carrying
semi-automatic firearmA semi-automatic, or self-loading firearm is a weapon which performs all steps necessary to prepare the weapon to fire again after firing—assuming cartridges remain in the weapon's feed device or magazine...
s,
handgunA handgun is a firearm designed to be held and operated by one hand. This characteristic differentiates handguns as a general class of firearms from long guns such as rifles and shotguns ....
s, and
improvised explosive deviceAn improvised explosive device , also known as a roadside bomb, is a homemade bomb constructed and deployed in ways other than in conventional military action...
s, and succeeded not only in stopping several patrol cars but forcing a
San BernardinoSan Bernardino is a city located in the Riverside-San Bernardino metropolitan area , and serves as the county seat of San Bernardino County, California, United States...
police helicopter to give up pursuit. By the end of the
Norco shootoutThe Norco shootout was an armed confrontation between five heavily armed bank robbers and deputies of the Riverside and San Bernardino County sheriff's departments in Norco, California, United States on May 9, 1980...
, a police officer and two robbers had been killed, with the other three suspects arrested and sentenced to life in prison.
In 1984 The boards of SPNB and Bank of Canton announced that SPNB wanted to acquire the ordinary and preferred shares of the Bank of Canton it did not already own. The agreement stipulates that the management of Bank of Canton will remain in place and that Russell Fok will continue as chairman of the board. Furthermore, a company associated with Fok will be entitled, upon completion of the acquisition, to purchase a limited equity position in BoC. SPNB agrees to pay $59.31 per share for the 714,128 common shares (31%) that it does not already own for a total cost of about $42 million.
In 1985 a class action lawsuit against Security Pacific accused it of overcharging some 2,500 trust accounts going back to 1974.
In 1986 SPNB acquired California Pacific National Bank, a small bank that primarily served Los Angeles's Chinese business community, for US$11.5 million. Earlier, BoC had revealed plans for a major expansion in the United States, concentrating on the growing Asian community in California. SPNB also entered into talks with American Asian Bank. This Chinese ethnic bank operated four branches around San Francisco and four in the Los Angeles area.
In 1988, Security Pacific denied a job to
hackerIn computer security and everyday language, a hacker is someone who breaks into computers and computer networks. Hackers may be motivated by a multitude of reasons, including profit, protest, or because of the challenge...
Kevin MitnickKevin David Mitnick is a computer security consultant, author, and hacker. In the late 20th century, he was convicted of various computer- and communications-related crimes. At the time of his arrest, he was the most-wanted computer criminal in the United States.-Personal life:Mitnick grew up in...
for his failure to disclose prior convictions. Four days later, a false press release circulated stating that the bank had lost $400 million in the first quarter, hurting the bank's share price. The
Federal Bureau of InvestigationThe Federal Bureau of Investigation is an agency of the United States Department of Justice that serves as both a federal criminal investigative body and an internal intelligence agency . The FBI has investigative jurisdiction over violations of more than 200 categories of federal crime...
attempted to use this
circumstantial evidenceCircumstantial evidence is evidence in which an inference is required to connect it to a conclusion of fact, like a fingerprint at the scene of a crime...
in their case against Mitnick, but no proof of a connection was ever uncovered. Mitnick, in particular, denied the allegation in his book
Ghost in the Wires, saying it was not his style, while admitting other crimes unrelated to the bank.
Also in 1988 SPNB completed the acquisition of Bank of Canton and renamed it Security Pacific Asian Bank. SPNB finally acquired American Asian Bank, controlled by individuals associated with the ailing Hong Kong-based Tung Group. (Earlier American Asian had acquired a portion of the failed American City Bank in 1983 and Toronto Dominion Bank of California in 1984).
The 1980s boom for a time sustained the bank, but its aggressive acquisition strategy, unfavorable financial engineering arrangements, and the 1990
recessionIn economics, a recession is a business cycle contraction, a general slowdown in economic activity. During recessions, many macroeconomic indicators vary in a similar way...
and
Southern CaliforniaSouthern California is a megaregion, or megapolitan area, in the southern area of the U.S. state of California. Large urban areas include Greater Los Angeles and Greater San Diego. The urban area stretches along the coast from Ventura through the Southland and Inland Empire to San Diego...
real estateIn general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
crash devastated its loan portfolio and balance sheet. Banking regulators, concerned problems at Security Pacific could compound the emerging
savings and loan crisisThe savings and loan crisis of the 1980s and 1990s was the failure of about 747 out of the 3,234 savings and loan associations in the United States...
, placed the bank under heightened scrutiny.
In 1992 Security Pacific Bank merged with
San FranciscoSan Francisco , officially the City and County of San Francisco, is the financial, cultural, and transportation center of the San Francisco Bay Area, a region of 7.15 million people which includes San Jose and Oakland...
-based BankAmerica (now called Bank of America), a deal that was at the time one of the largest bank mergers in history. Federal regulators, however, forced the sale of Security Pacific's Washington subsidiary, Rainier Bank, as the combination of Seafirst and Rainier would have given BankAmerica too large a share of the market in that state. The Rainier Bank branches were divided and sold off to West One Bancorp (now
U.S. BancorpU.S. Bancorp is a diversified financial services holding company, headquartered in Minneapolis, Minnesota. It is the parent company of U.S. Bank, the fifth largest commercial bank in the United States based on $330 billion in assets. U.S. Bank ranks as the sixth largest bank in the U.S. based on...
) and KeyBank. Later that year, BankAmerica expanded into Nevada by acquiring Valley Bank of Nevada.
In 1993 Bank of America changed Security Pacific Asian Bank’s name to
Bank of America (Asia)China Construction Bank Corporation Limited is a licensed bank incorporated in Hong Kong.-History:...
. In 1994 Arab-Malaysian Bank acquired Security Pacific Asian Bank operations in Malaysia.
In 2000 Robert H. Smith, Security Pacific's last chairman and CEO, published the book
Dead Bank Walking which chronicled the merger.
New Security Pacific Bank
A new Security Pacific Bank emerged in February 2005, the result of a name change by a bank formerly known as Network Bank USA and, prior to that, Golden Pacific Bank. The new Security Pacific Bank (which failed on November 7, 2008) had no relation to Bank of America or the former Security Pacific National Bank, although it did utilize the same interlocking 'S' logo as the former bank. After its closure, it was acquired by Pacific Western Bank.