Charles Linn From its incorporation in 1972 until 2006, when it was taken over by Regions Financial Corporation, AmSouth Bancorporation was one of Alabama‘s largest and most prosperous financial institutions. The bank that would become AmSouth went through several incarnations in the Birmingham area before taking on its modern name. In the early twenty-first century, the bank took advantage of regulatory changes and bought out other banks prior to its merger with Regions.
AmSouth Bancorporation traces its roots to Charles Linn, a Scandinavian immigrant and former ship captain, established the National Bank of Birmingham in 1872, just one year after the city’s founding. It was the first bank in Birmingham’s history and quickly grew under Linn’s leadership before merging with the City Bank of Birmingham in 1884 to create the First National Bank of Birmingham. First National not only endured the Panic of 1898, and the Great Depression, but it also provided several smaller suburban banks with the financial support they needed to survive the economic crisis. In 1935, six of these banks became the first branch locations of the First National Bank. The institution continued to expand in Jefferson County throughout the next three decades.
First National Bank in Birmingham In 1971, First National moved its headquarters to a newly constructed 30-story office building located at 20th Street and Fifth Avenue North in downtown Birmingham. (The building, known initially as the First National-Southern Natural Building, later was named the AmSouth-Sonat Tower.) The following year, shareholders approved the formation of a holding company legally capable of owning or controlling one or more commercial banks. This restructuring allowed the company to expand by acquiring new banks with the goal of establishing a statewide dominance within the banking industry. First National eventually acquired more than 20 affiliate banks, which were owned by the holding company, and became known as Alabama Bancorporation in 1972.
The new entity was led by John W. Woods, who served as chief executive from 1972 until his retirement in 1995. A former Air Force pilot, Woods began his banking career at Chemical Bank in New York before he was lured to serve as president of the First National Bank of Birmingham in 1969. Three years later, he became the first chief executive of Alabama Bancorporation. Under Woods, company assets increased from $800 million to $18 billion and added 20 banks. Woods also directed the acquisition of many competitor banks during his tenure.
The company continued to grow as a result of state and federal legislation approved in the 1980s. In 1981, the state government allowed banks to merge across county lines, and that April the corporation adopted the name AmSouth Bancorporation to better reflect its expanding geographic coverage. AmSouth became the first bank holding company in the state to be listed on the New York Stock Exchange. By the end of 1983, AmSouth had more than 100 branches throughout Alabama. In 1987, AmSouth took advantage of recently enacted federal legislation allowing interstate banking to venture outside of Alabama. During the next seven years, it purchased nine more banks in Florida, Tennessee, and Georgia.
Despite fiscal problems caused by a general downturn in the banking industry during the late 1980s, by 1994 the company had become a conglomerate of more than 50 banks and sought to become the South’s leading banking institution. AmSouth made no further acquisitions during the remainder of the 1990s, instead focusing upon performance. In 1999, AmSouth was added to the prestigious Standard & Poor’s (S&P) 500 Index, a benchmark group of stocks considered to be representative of the performance of the stock market as a whole. Later that year, the company undertook the largest acquisition in its history when it merged with and absorbed the larger Nashville-based First American National Bank, with nearly 400 branches in Tennessee as well as many in Kentucky, Virginia, and Mississippi. With this acquisition, AmSouth more than doubled its size to $40 billion in assets, 680 branches in nine states, and a network of 1,350 automated teller machines (ATM) in the Southeast.
In 2004, AmSouth ran afoul of federal reporting requirements. The U.S. Attorney’s Office for the Southern District of Mississippi investigated the bank’s failure to file Suspicious Activity Reports (SARs) in the wake of a fraud scheme that conned more than 60 investors out of millions of dollars, despite suspicions of illegal activity. The company paid out $40 million to the U.S. government and $10 million in civil penalties for its negligence.
Regions-AmSouth Merger AmSouth’s merger with Regions in 2006 enabled the new entity to become the nation’s eighth largest bank, with assets of approximately $140 billion and more than 2,000 branches. The merger came with a cost, however. In late 2006, company officials announced that it would likely close or consolidate 160 branches by mid-2008, in addition to cutting as many as 3,500 jobs. In early 2008, the company announced it would cut about four percent of its 33,000-person workforce or about 1,300 positions, in relation to the merger. The company also had to sell 52 branches in Alabama, Mississippi, and Tennessee in accordance with federal antitrust guidelines. Also headquartered in Birmingham, Regions Financial Corporation is a member of the S&P 100 Index and is on Forbes magazine’s “Platinum 400” list of America’s best big companies. It has branch offices in 16 states: Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, South Carolina, Tennessee, Texas, and Virginia.
Both Regions and AmSouth have a history of providing community in the form of charitable donations. In 2005, for example, both companies donated a total of approximately $14 million in support of the arts, education, health and human services, and community and economic development. AmSouth’s support of education was demonstrated in 2002, when the company donated $1 million to the University of Alabama at Birmingham (UAB) to establish the AmSouth Academic Scholars Endowment from which scholarships would be granted to incoming freshmen students.
O’Donnell, Joe. The Forge, Metal to Medicine: Birmingham’s Business History. Birmingham, Ala.: Birmingham Regional Chamber of Commerce, 2007.