is this stepfather, Mr. I. Scatena, who is now chairman of the Board of Directors of the Bank of Italy.

Mr. Giannini and his stepfather were successful in the commission business. Vegetables and produce of all kinds were brought in from the districts across the Bay and sold to the people of San Francisco. It was in this way that Mr. Giannini got his financial start.

About 1900 he branched out into real estate at a time when realty values in San Francisco were rising. This gave him more profits. He was then asked to become a director of the Columbus Building and Loan Association on account of his influence in the Italian colony. He did not stay long with this organization, resigning because of lack of agreement with the other directors. The Columbus Building and Loan Association conducted a sort of banking business, so that he was able to learn something about banking.

On leaving the Building and Loan Association he determined to start a bank of his own. With about ten of his Italian friends associated with him as stockholders he opened in October, 1904, the Italian Bank of California, as it was called, with a capital of $150,000. He soon changed its name to that of Bank of Italy. The bank, a small affair located in the Italian district, attracted little attention at that time. The depositors were largely Italian friends of Mr. Giannini and his father, a clientele that had been built up while Mr. Giannini was in the commission business.

In 1906 came the disastrous earthquake and fire in San Francisco. This catastrophe ultimately proved to be a real help to Mr. Giannini. On the morning of the earthquake he hurried to his modest bank to see how it had fared. The fire was approaching the district where the building was located, so he obtained a horse and wagon, loaded into the wagon the cash, securities, books and stationery of the bank, and with an escort of two soldiers that had been provided him drove to his home in San Mateo, twenty miles distant. Here the treasure was buried in the garden.

While the fire was still smouldering, Mr. Giannini had the distinction of having his bank the first to reopen for business. He set up a desk in the open at the water front with a sign over it,

"Bank of Italy," and here conducted an improvised banking business. A few days later he moved his bank to the residence of his brother on Van Ness Avenue, which was in the district that had escaped serious damage. About a month later he opened temporary quarters on Montgomery Street, until a permanent building could be constructed on Montgomery and Clay streets. The Montgomery Street bank had its name appear in Italian, "Banca d' Italia".

After the fire and earthquake the Banca d' Italia adopted a fairly liberal loan policy for reconstruction purposes. This policy, combined with the fact that it had weathered the catastrophe so successfully and reopened so early, added greatly to its prestige and to the extent of its business.

Paradoxical as it may seem, the financial panic of 1907 gave the Bank of Italy another boost. The bank had maintained large specie reserves, partly because of the nature of the business of its customers who made heavy demands for cash, and who liked “hard money", and partly as a matter of deliberate caution. During the crisis of that year, when most other banks were suspending cash payments, the Bank of Italy was able to pay in gold all the demands that were made upon it. Confidence in Mr. Giannini and his Bank of Italy thus scored again.

III

The year 1907 marked the entry of Mr. Giannini into branch banking. In August of that year he opened a branch on Mission Street, San Francisco. Two years later, December, 1909, he purchased the Commercial and Savings Bank of San José, which had resources of $491,000. In October, 1910, the Bank of Italy moved up in society when it appeared on Market Street. This was accomplished through the purchase of the Bank of San Francisco and the Mechanics Savings Bank, two institutions which were merged into one and known as the Market Street Branch of the Bank of Italy. The Bank of Italy was thus leaving the old Italian district and moving along side of San Francisco's established and most reputable institutions.

It was about this time that Mr. Giannini's moves began to

attract more than casual attention. His entrance into Market Street caused considerable comment, and also sharp criticism. Branch banking was unpopular, and the sentiment against it in some quarters in California was at that time fairly strong.

His next move was to take over the Bank of San Mateo, in his home town, which became known as the San Mateo Branch of the Bank of Italy. Further comment and criticism resulted. In order to help finance this expansion he began actively to sell stock in the Bank of Italy to the general public.

In 1913 occurred his most spectacular move up to that time. Los Angeles, five hundred miles to the south, had been watching proceedings from a distance. He now purchased the Park Bank at Fifth and Hill Streets, Los Angeles, and thereby also acquired a branch of the Park Bank out on Pico Street, Los Angeles. The banking fraternity in Los Angeles viewed this action with disapproval. His bitterest fight throughout has been waged in Los Angeles and began about this time. The State Banking Department of California also soon began to view with suspicion the branch expansion of the Bank of Italy.

Another bank in Los Angeles was acquired in 1914, when the City and County Bank was purchased and merged with the Park Bank. The following year Mr. Giannini moved his Los Angeles bank to the corner of Seventh Street and Broadway, the very heart of the Los Angeles business district. He also opened that year, 1915, the International Branch on North Spring Street, in a district where the bank could cater to the foreign element.

Rapid expansion of branches took place in 1916 and 1917, especially in the latter year. One bank after another was added up and down the length of the State, usually by the purchase of an existing bank. The Bank of Italy during these years entered the San Joaquin Valley, and then the Santa Clara Valley, two of the great agricultural districts of California.

Acquisition of branches under the name Bank of Italy continued until the passage by Congress of the McFadden Bill, early in 1927. This Act prohibits any bank in the Federal Reserve System from establishing branches outside the city where it is located.

Immediately prior to the passage of the Act the acquisition of

branches was especially active. The Act was signed by President Coolidge on February 25. On January 28 had come the announcement of the consolidation of four Giannini banks, the Liberty Bank of San Francisco with thirty-two branches, the Bank of America of Los Angeles with twenty-two branches, the Commercial National Trust and Savings Bank of Los Angeles with twenty-three branches, and the newly acquired Southern Trust and Commerce Bank in San Diego with eight branches. This merger was approved by the new State Superintendent of Banks of California, the application for merger having been pending, it is understood, for eleven months under the former Administration.

On February 15 the Superintendent of Banks approved the purchase by the Bank of Italy of the newly consolidated institution, which had been named the Liberty Bank of America, subject to approval by the Federal Reserve Board, which was later given on February 21. On February 16 the McFadden Act passed the Senate and went to the President, by whom it was signed on February 25. Thereupon the Bank of Italy, now with 270 branches, took out a national charter under the title Bank of Italy National Trust and Savings Association, and opened for business as a National bank on March 1, 1927.

Since the passage of the McFadden Act the Bank of Italy has established fourteen new branches in the city of San Francisco and has acquired banks outside of San Francisco by means of the holding company device, and also by other legal means, so that at present it has 289 branches.

The principal means for further branch expansion by the Bank of Italy interests in California is at present through ownership by Bancitaly of stock of the United Security Bank and Trust Company. This bank, with its head office in San Francisco, is under State charter and is not a member of the Federal Reserve System. The bank is therefore free, so far as the McFadden Act is concerned, to establish branches anywhere it wishes in California. The United Security Bank and Trust Company has at present fifty-four branches throughout the State, which are in effect part of the Bank of Italy system. The United Security Bank has a capitalization of over eight million dollars and de

posits of $142,000,000, so that by itself it is not a small institution. The development of the United Security Bank and Trust Company along branch lines has brought to the front a clash over names, now in the California Supreme Court, which is likely to be but the beginning of a long series of difficulties over similarity in names as banks reach out and invade each other's territories.

Among the oldest, largest and most respected banks in Los Angeles is the Security Trust and Savings Bank located on the corner of Fifth and Spring Street, a bank which has approximately fifty-five branches, a capitalization of twelve million dollars and deposits of $249,000,000. The United Bank and Trust Company, with its head office in San Francisco, was formed in April, 1927, out of the consolidation of two other banks, one of which dated back to 1860. Further consolidation took place in October, 1927, when the name was changed to Security Bank and Trust Company and the place of business moved to Bakersfield, where was located the Security Trust Company, one of the consolidating banks. In March, 1928, additional consolidation was accomplished and the name changed again, this time to its present form, United Security Bank and Trust Company. The place of business was moved back to San Francisco.

The United Security Bank and Trust Company has been acquiring branches in Southern California in proximity to branches of the Security Trust and Savings Bank, the Los Angeles institution, and has plans for further expansion in that part of the State. The Security Trust and Savings Bank has therefore secured an injunction against the United Security Bank and Trust Company prohibiting the latter institution from establishing additional branches under its existing name. The United Security Bank is contesting the authority of the court to grant the injunction, maintaining that approval of the name by the State Superintendent of Banks is final.

A humorous side to the dispute occurred when a telegram from Mr. Giannini intended for his own United Security Bank was delivered by mistake to the other Security Bank.

Another conflict over similarity in names occurred last year when the First National Bank of Los Angeles, another of the