Wachovia Bank
Wachovia Bank, based in Charlotte, North Carolina, purchased Birmingham's SouthTrust Bank in 2004. The company operated a nationwide financial services network with assets of over $706 billion and deposits of over $408 billion. In September 2008, Wachovia had 38 branches in the metro area, employees on about nine floors of the 34-story Wachovia Tower and more at a call center in Homewood at Wildwood, and a $400 million data center in the Oxmoor Valley.
In 2008, Wachovia was hit hard in the 2008 national financial crisis, stemming primarily from the 2006 acquisition of California mortgage lender Golden West Financial Corp, which specialized in sub-prime mortgages. On September 29, 2008, Wachovia Corp agreed to sell its banking operations to New York-based Citigroup, Inc. in a takeover orchestrated with help from the Federal Deposit Insurance Corporation (FDIC). Former Southtrust shareholders would have been left with stock in a company that consisted of Wachovia Securities retail brokerage and Evergreen Investments. However, on October 3, Wells Fargo Co. of San Francisco, California announced that it would be acquiring the complete Wachovia Corp portfolio, without assistance from the FDIC, for $7 per share.
If the Wells Fargo deal is approved, that bank will double in size and become the largest in the country. Citigroup immediately challenged the acquisition, and a New York judge put the Wells Fargo deal on hold pending litigation.
References
- Hubbard, Russell (September 30, 2008) "Wachovia sells banking operation to Citigroup." Birmingham News
- Hubbard, Russell (October 4, 2008) "Everything must go: Wachovia sells to Wells Fargo." Birmingham News