The following article was written in 1992 by my father Francesco (Frank) Caponegro and published as a “UNICO Historical Feature” by the Greater Kansas City Chapter of UNICO, an Italian-American organization, in its members-only magazine. It is one of several articles my father submitted under the heading “As a Matter of Fact…Italian: All About Fellow Paesani.”
Luigi Giannini was not to be found among “the poor, the tired huddled masses.” He and his wife Virginia, nee DeMartini, who had married at the ages of twenty and fourteen respectively, emigrated to the sunny Santa Clara Valley in California drawn by accounts of promised prosperity. Both were from farming families that had earned comfortable livings, albeit laboriously, from the soil around Genoa in Italy that had been overworked for centuries. By contrast, it appeared to them that hard work in the New World would be rewarded more generously.
In 1869 Luigi and Virginia were pioneer passengers on the newly completed transcontinental railroad that brought them from New York to the West Coast, where they settled in San Jose. Older than San Francisco, San Jose was the first major settlement in California. It was the first inhabited by Americans in 1845, and only about twenty-five years later it was well-represented by those Italian immigrants who were there to greet the Gianninis. With not much more than a few bucks in his pocket, Luigi was able to lease the twenty-room clapboard Swiss Hotel in downtown San Jose where his first son was born May 6, 1870, and he saved enough within a year to purchase a forty-acre farm northeast of San Jose at Alviso. Along with the land’s good harvests came two more sons.
It was his eldest, Amadeo Peter Giannini, age seven, who saw Luigi shot by an eccentric farmhand in an altercation over a debt of one or two dollars. The father lay dying in the son’s arms because of an argument over a paltry sum of money - but nevertheless money - and perhaps it was a tragic foreshadowing of the billions of dollars that were to mark the life of A. P. Giannini, as he was popularly called. [For a detailed account of his youth, see Julian Dana’s “A. P. Giannini: Giant in the West.”]
Stepfather Lorenzo Scatena took the Giannini family to North Beach, San Francisco's Italian colony, when A. P. was twelve. Scatena found marketing fruit and vegetables less trying and more profitable than growing the produce. He was as successful as head of the family as he was in business; his stepsons adored him, and he enlarged the family with three children the former Virginia Giannini bore him. Scatena was father, companion, and business associate to A. P. until the very end of his life.
The six-month business course A. P. completed after elementary school was the last of his formal education. He contributed aggressively and significantly to Scatena’s firm from childhood and was made a full partner at nineteen. At twenty-two he married Clorinda Agnes Cuneo, whose Italian-born father had made a small fortune in real estate.
Through the years A. P. was to announce his retirement several times. The first was made at age thirty-one when he sold his partnership interest for one hundred thousand dollars to several of his employees. He was content with the two hundred fifty dollars a month income his investments afforded him, an amount then capable of comfortably supporting a family. He reportedly said, “I don't want to be rich. No man actually owns a fortune; it owns him.” Considering that billions of dollars were to pass, as it were, through his hands, he emerged the unique financier who struggled half a century to avoid becoming a millionaire!
His short-lived retirement saw the death of father-in-law Joseph Cuneo, whereupon he inherited several obligations including membership on the board of the Columbus Savings and Loan Society, the first bank in the Italian North Beach. He was in serious disagreement with the bank’s policies from the very start, especially with its reluctance to serve the small entrepreneur, the “little fellow,” who often resorted to loan sharks, and all too often ruinously. Unable to remain in good conscience, he resigned, and he, a neophyte, decided to establish his own bank: the Bank of Italy! [For an account of his financial empire, cf. “Biography of a Bank: The Story of Bank of America” by Marquis James and Bessie Rowland James.]
The Bank of Italy, appropriately named for having initially served A. P.’s paesani in North Beach, was formed in 1904 with a capital of three hundred thousand dollars. On Montgomery Street, San Francisco's Wall Street, it went completely unnoticed; but in 1906 as San Francisco was laid waste by earthquake and fire, Giannini and the bank started a meteoric ascendancy into banking history. A.P. proved his mettle by rescuing the bank’s two million dollars in gold and securities by hiding them under heaps of produce in horse-driven carts (borrowed from Scatena) driven through the ruins past drunken looters, never stopping until the assets were safely hidden in the fireplace of his San Mateo home. Soon he was making loans to businessmen, otherwise incapable of rebuilding the city, over “a plank laid across two barrels on the Washington Street wharf.” His reputation after the earthquake is best described by what we read in his New York Times obituary: “His name suddenly became to San Franciscans a symbol of wisdom, daring, and integrity.”
The image of Giannini the banker was further enhanced by the panic of 1907, which he anticipated and provided for by hoarding gold. During the crisis, unlike other banks, the Bank of Italy was paying depositors in hard money. Concluding that banking safety lay only in size, A. P. starting to acquire hundreds of banks throughout California. The year 1928 saw the birth of Transamerica Corporation, comprising the Giannini banking, insurance, and industrial organizations. In 1930 the name Bank of Italy ended, as the institution was merged into the Bank of America National Trust and Savings Association. Far from ever disdaining a large account, nonetheless, the bank loaned as much as three hundred dollars to a wage-earner on his signature alone. Well-represented among beneficiaries were the California fruit growers. In 1935 the president of the United States was to say, “In my opinion, A.P. Giannini has done more to build California through his great bank and his personal efforts than any other Californian.” [A good review of Bank of America history from the Giannini years to its troubles in the 1980s can be obtained from “Breaking the Bank: The Decline of Bankamerica” by Gary Hector.]
Transamerica, like all businesses, was adversely affected by the depression, and Wall Streeters to whom A. P. had entrusted the corporation, possibly underestimating the financial condition of Transamerica, embarked upon a course of dismembering it. Apprised of the plan, Giannini envisioned his empire, including Bank of America, at the time a subsidiary ofTransamerica, vanishing. He thought of it as a conspiracy in which Transamerica assets would be divested at bargain prices to the advantage of the Wall Street people involved. In a proxy fight that must be described in detailed to be appreciated [cf. already recommended books] A.P. emerged victorious. It was said that only two men were able to take on Wall Street and win: Henry Ford and A.P. Giannini. What made A.P.’s accomplishment remarkable is that Giannini, consistent with his vow to eschew personal wealth, interests combined, owned less than one tenth of one percent of the stock. Proxies were pledged to him solely on the strength of his reputation.
A.P. resumed control of his empire, which he kept on expanding and readied for California's war boom. In 1945 the Bank of America, which began as the Bank of Italy in 1904, had become the world’s largest private bank. Giannini died in 1949, and the bank in 1953 with resources of about eight trillion dollars had “the largest aggregation of wealth ever assembled under one banking management in the history of mankind.” [cf.Marquis James] Yet the bank’s savings and checking account balances, averaging only about nine hundred dollars and sixteen hundred dollars respectively, attested to A.P.’s desire to serve, as he put it, “the little fellow.”
Giannini constantly fought regulation and legislation instigated by competitors fearful of his success, men who were hindering the greatest innovator in banking history. A. P. began lending on automobiles, offered unsecured loans for purchasing appliances, and furthered government programs for aiding farmers, homebuyers, and returning servicemen.
It was said of his wife Clorinda Agnes who died in 1941, that A.P. had cherished the “love and companionship of the girl who was to be the only woman in his life.” In 1904 A. P. had built the spacious home called Seven Oaks in San Mateo for Clorinda Agnes and the children. At that time he was worth three hundred thousand dollars. I do not recall who said, “What does not destroy me, makes me stronger,” but if it means that one thrives on adversity, then it most certainly applied to A. P. -through the 1906 earthquake, the 1907 crash, and finally the depression years. In late 1929 Giannini, affected by polyneuritis, retired as head of Transamerica to seek medical help in German and Austrian spas. At his death Seven Oaks was still “home” and his personal fortune was less than five hundred thousand dollars. In terms of equivalent dollars, he had passed on with a mere fraction of what he possessed forty-five years earlier.
In his instructions regarding the aims of his Bank of America-Giannini Foundation, he wrote, “Like St. Francis of Assisi, do good…do not merely theorize about goodness. This is my wish and I confidently commit this Trust to your hands for its fulfillment.”
What an interesting piece of history!
Thank you! I will be posting soon at least 4 more pieces my father wrote about not well-known Italians or facts about them...