Bank of Boston
| File:Bank Boston.png | |
| Industry | Bank holding company |
|---|---|
| Predecessor | Bank of Boston BayBank |
| Founded | Template:Sda (as Massachusetts Bank) |
| Defunct | October 1, 1999 |
| Successor | FleetBoston Financial |
| Headquarters | Boston, Massachusetts, United States |
| Products | Financial services |
BankBoston was a financial institution headquartered in Boston, Massachusetts, established through the 1996 consolidation of Bank of Boston and BayBank. Although its roots extend back to 1784, the combined organization existed briefly before being acquired by FleetBoston Financial in 1999. Subsequently, in 2005, FleetBoston was integrated into Bank of America headquartered in Charlotte, North Carolina.
Following the divestiture of its Latin American operations in 2006, BankBoston currently functions exclusively as a private banking subsidiary under Bank of America.
History
The evolution of BankBoston illustrates the amalgamation of multiple New England banking institutions over more than two hundred years. Prominent antecedents include the Massachusetts Bank, First National Bank of Boston, Old Colony Trust Company, and BayBank.
The Massachusetts Bank
The foundation of Bank of Boston traces back to The Massachusetts Bank, established in 1784. It holds the distinction of being the first federally chartered joint-stock bank in the United States and was the second to receive a federal charter after the Bank of North America. The charter bore the signature of John Hancock, with early clients comprising distinguished individuals such as Paul Revere, Samuel Adams, and Henry Knox. Created mainly by merchants desiring a U.S.-based institution to facilitate international trade, its initial headquarters were located at the former Manufactory House near Boston Common.
For several years, The Massachusetts Bank was Boston’s sole banking institution until 1792 when the Union Bank—later known as the Bank of New England—was founded.
In 1786, it financed the inaugural U.S. trade expedition to China and supported the first American ship voyage to Argentina in 1791, establishing early ties that would underpin its substantial Latin American presence. Over time, Bank of Boston emerged as a leading foreign bank across key Latin American markets.
In 1864, The Massachusetts Bank adopted the name Massachusetts National Bank.
First National Bank of Boston
In 1903, The Massachusetts Bank merged with The First National Bank of Boston amid a wave of early 20th-century banking consolidations. Originally founded in 1859 as Safety Fund Bank, it assumed the First National Bank title in 1864 upon joining the national banking system. After briefly operating under the name The Massachusetts First National Bank of Boston, it soon removed "Massachusetts" from its title.
On December 24, 1927, anarchist Severino Di Giovanni bombed Bank of Boston’s Buenos Aires offices during international protests related to Sacco and Vanzetti.
Despite challenges following the 1929 stock market crash, First National Bank of Boston expanded by acquiring Old Colony Trust Company. However, due to provisions in the 1933 Glass–Steagall Act, it was compelled to separate from its investment banking division, which became First Boston Corporation.
In 1970, the bank restructured under a holding company named First National Boston Corporation and pursued regional acquisitions throughout the next two decades. Notably, in a pivotal 1978 Supreme Court case titled First National Bank of Boston v. Bellotti, its First Amendment rights to engage in political speech were affirmed. The institution rebranded as Bank of Boston in 1982 and subsequently acquired Connecticut-based Colonial Bancorp in 1985 and Vermont's BankVermont Corporation in 1987.
Acquisition of BayBank Leading to BankBoston Formation
During the 1990s, Bank of Boston aimed to enhance its market share through a significant acquisition but was outbid by Fleet Bank in 1991 for the failed Bank of New England. A proposed merger with Shawmut Bank fell through in early 1992. Negotiations with Fleet in 1994 ended without agreement, especially as Fleet merged with Shawmut in 1995, establishing itself as the largest bank in New England.
In 1995, Bank of Boston combined forces with BayBank, a prominent retail banking institution operating 205 branches and over a thousand ATMs. BayBank, originally founded as Old Colony Trust in 1928 and renamed BayBanks in 1976 following a series of acquisitions, derived 80% of its income from retail banking and served nearly one-third of households in eastern Massachusetts.
This merger reinstated Bank of Boston as the leading bank in Boston by assets—reaching $62 billion by the close of 1996—although Fleet remained larger on a regional scale. The institution was rebranded as BankBoston in 1996, continuing to maintain a strong presence both domestically and internationally, particularly throughout Latin America.
In August 1998, BankBoston expanded further by acquiring Robertson Stephens & Co. from BankAmerica Corporation for roughly $800 million, marking its second most substantial acquisition after BayBank.
Bank of New York Partnership
On October 26, 1999, Bank of New York designated BankBoston Panama as its subcustodian bank within Panama. Established in 1973, BankBoston Panama had been providing custody services to non-resident investors since 1996.
Merger with Fleet
Fleet Bank, headquartered in Boston and originally founded as Providence Bank in 1791, acquired BankBoston in 1999 following its earlier purchase of Shawmut Bank. While Fleet dominated the New England banking sector, it retained the BankBoston brand for operations in Latin America.
This union resulted in the creation of the eighth-largest U.S. bank at that time, with combined assets exceeding $190 billion. Together, they had absorbed eight out of the ten largest banks in New England since the early 1990s.
The new entity, named FleetBoston Financial, operated from BankBoston’s former headquarters in Boston and maintained branch networks across New England and the mid-Atlantic region. In 2000, FleetBoston further expanded by acquiring Summit Bancorp based in Princeton, New Jersey, securing the top market share position there and entering the Philadelphia metropolitan area.
Acquisition by Bank of America
In 2004, FleetBoston was acquired by Bank of America as part of its strategy to strengthen its footprint along the East Coast. Subsequently, Bank of America divested BankBoston’s Latin American operations to concentrate on domestic expansion.
On December 17, 2004, Bank of America sold its BankBoston branches in Peru, Colombia, and Panama to Banco General—a Panamanian private equity bank founded in 1955—which maintains offices and correspondent relationships throughout Latin America and the Caribbean.
In 2006, all Brazilian assets under BankBoston were sold to Banco Itaú in exchange for shares; notably, the use of the BankBoston name was excluded from this transaction and remains prohibited for use by Bank of America. Banco Itaú also acquired BankBoston’s holdings in Chile and Uruguay during August 2006. The BankBoston brand persisted until Itaú completed its acquisitions in Chile (February 2007) and Uruguay (March 2007).
In December 2006, Argentina’s central bank authorized the sale of BankBoston Argentina to South Africa’s Standard Bank—a deal finalized by April 2007—after which the BankBoston brand ceased operations there. Standard Bank later sold an 80% stake to Industrial and Commercial Bank of China in 2012.
Currently, the BankBoston name survives solely as an international private banking subsidiary owned by Bank of America.