Chapter 483: Two Sides of the Coin

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"Stephen!"

"Now I should call you BOSS too!" said Stephen Bryan, who let go after hugging Guo Shouyun.

"It's fine to call me by my name in private, I still prefer the name Bruce!" patted him on the shoulder, "It's nice weather outside today, let's go for a walk?"

"Okay!"

Although the temperature in New York at the end of April is still not high, it looks very comfortable in the warm morning sun. And Guo Shouyun's back garden on the forest garden is very well maintained, especially the large green and flat lawn, which makes people have a special walk.

"Today is a rare good weather, if it weren't for the lack of time, I really want to go play golf!" Guo Shouyun said with a smile.

Stephen Bryan nodded in agreement, "Although good weather is rare, there will be many in the future, but some opportunities are not often for us." ”

Guo Shouyun glanced at him and smiled: "Listen to your tone, something has changed?"

"Ruben d'Estaing is more powerful than I thought!"

"Oh, how do you say that?" Guo Shouyun said curiously.

"He wants to merge his National City Bank with our Phoenix Company!"

"Merger? He doesn't want to be chairman of the board of directors? And he manages the National City Bank, which is one of the top 20 banks in the United States, and he is willing to do it?"

"If you can get a higher return through a merger, almost no one will be reluctant to do so. Bruce, I know Phoenix better than you about its place on Wall Street. Since her inception, each of her active funds has achieved one of the highest returns among similar funds in the United States. ”

"Phoenix Capital, three years after its establishment, has increased its own assets by 15 times, and its companies holding more than 5% of the shares have performed very well. BlackBerry, in particular, is now the most popular and fastest-growing mobile phone company in the United States, tripling its market value compared to when it was invested. Other key investment companies such as AMD, Gilled Sciences, and Amgen have nearly doubled their market value compared to when they invested. ”

There is also the well-known Thunder Fund, which has created an astonishing annual rate of return of 227.8%. Even the little-known Phoenix Trust grew at a rate of 57.4% per quarter. ”

Today, the entire Phoenix company has more than $350 billion in funds under management, $42.68 billion in its own capital, and a debt ratio of 37.2%. From its inception to the present, on a quarterly basis, the average increase in the scale of funds under management is 144.6%, the average increase in revenue is 87.4%, and the average increase in net income is 73.9%, which is nearly 2.6 times higher than that of similar companies. If it weren't for the fact that Phoenix had not yet been listed, institutions and investors who wanted to invest in our stocks would have broken the threshold of the New York Stock Exchange long ago. ”

In contrast, National City Bank is the 13th largest commercial bank in the United States, with $16.7 billion in own capital and $173.2 billion in assets. But its annual revenue was only $3.42 billion and its net profit was $457 million, a quarterly increase of less than 6%. Own capital and assets are only one-third of Phoenix. The more important revenue and profit are only one-tenth of ours, or even less. If I were the chairman of the board of directors of the National City Bank, I would also merge the company into Phoenix and take as many shares as I could in the new company, because the fool knows that the shares will increase much faster than the market value of the National City Bank. ”

Glancing at him, Guo Shouyun smiled and said, "The difference between you and Ruben d'Estaing is that you will ask me for the position of CEO of the new company." ”

He didn't know Ruben d'Estaing, but he knew Stephen Bryan's career pursuits.

“… However, I remember when we were talking about the acquisition of First Franklin Financial in Modu, you were against my acquisition of the National City Bank, and I should have focused on subordinated bonds, why did this change?"

"Because this is a merger, not an acquisition! It doesn't require us to come up with much capital, we only need to give up a part of the shares of Phoenix Company!" After taking a deep look at Guo Shouyun, "Bruce, the market value of the National City Bank of the United States is $11.5 billion, and considering the premium factor, it should be worth about $13 billion." Although Phoenix is not listed, with our revenue and net profit, as well as assets and liabilities, our market value will exceed $43 billion if it is listed, and if the premium factor is added, it will be no less than $50 billion. Even if the two parties merge, you will still have more than 75% of the shares in the new company, and you will have an absolute controlling stake. ”

Guo Shouyun nodded with a smile.

"I understand, Stephen. As long as I can guarantee my controlling stake in Phoenix, I don't mind giving up my shares. But one more thing you have to understand is that once we merge with the American National City, then we will have to abandon Merrill Lynch in a short period of time, and even cancel the merger plan for Merrill Lynch. ”

"I can understand that I will abandon the acquisition of Merrill Lynch in a short period of time, but why should I cancel the acquisition of Merrill Lynch?" asked Stephen Bryan after a pause.

"I have two plans for the future of Phoenix. One is investment banking financial companies like Da Mo, Goldman Sachs, and Merrill Lynch. The other is the universal bank represented by Wells Fargo and Seymour. If you choose National City Bank now, then Phoenix's future is the path of Wells Fargo, Seymour, and Citi. ”

After nodding clearly, Stephen Bryan pondered for a moment, "What about Merrill Lynch? We have invested so much money and energy in Merrill Lynch's mergers and acquisitions, wouldn't it be a pity to give up?"

Guo Shouyun smiled and shook his head.

"You're wrong again. I said that Phoenix gave up the acquisition of Merrill Lynch, but I did not say that I gave up the acquisition of Merrill Lynch. ”

Stephen Bryan's pupils shrank, his gaze quickly swept over the confident face of the man beside him, and sighed slightly.

"Bruce, your insatiable ambition is truly something he amazes and admires me!"

"I just don't want my life to be too dull. … Tell us about your plans for your new company. I know that when you were leaning towards merging with the National City Bank, you must have thought about the way forward. ”

Stephen nodded, "You know I'm an investment banker, and I'm more inclined to be a pioneer for the future of a new company. Start with real estate subordinated debt, seize the opportunity of the rise in U.S. real estate and grow as soon as possible. ”

Throughout the centuries of the world's financial history, innovation and conservatism are like two sides of the same coin, representing two different routes. Among them, the representative of innovation is Citigroup, and the representative of conservative is Wells Fargo.

Take the two sides as an example: Citi's predecessor was the City Bank of New York, which was founded by the Stillman family in 1812. How can a small bank stand out from the crowd in the New York financial market, where there are more banks than rice shops? The City Bank of New York chose to go overseas and provide financing services to businessmen who trade in Latin America. At that time, the mainstream of overseas trade was the import and export of Europe and North America, and relatively speaking, Latin American trade was a high-risk, low-profit small business, just like the unfortunate masters who ran to Africa and the Middle East today.

Emerging markets have a bright future ahead of their overseas trade, despite their low starting point. With the rise of the United States as a world power and the global trade network, Citi is undoubtedly at the forefront of the trend. They were the first to open overseas branches to carry out foreign exchange trading business, and laid branches in Modu, Manila, India, Hong Kong, Singapore, and Argentina, creating the largest overseas banking network in the United States.

On the other hand, Citibank, which has tasted the sweetness of adventure, has a strong interest in innovation in the financial industry.

They were the first to use compound interest to calculate interest on savings accounts, the first to offer unsecured personal loans, the first to offer checking accounts that did not require a minimum balance, the first to invent negotiable certificates of deposit, the first to launch leasing businesses and MasterCard credit cards, and the first to launch ATMs and online banking services.......

To this day, the reason why Citi is called a group, not a bank, is because the bank is only a part of its business, as well as securities brokerage, investment banking, insurance, and funds, and its business is the most complex among the four major banks in the United States.

Compared with Citibank, which has always been at the forefront of the times, Wells Fargo's history could not be simpler, and the more conservative could not be more conservative. To this day, Wells Fargo is still positioned as a retail bank, known for its many outlets, communities and tellers, and it neither goes abroad nor innovates.

Wells Fargo is wholeheartedly engaged in retail, and if the wind of your Internet thinking blows to the sky, I will remain unmoved, and I will do a good job of humanized service for a hundred years. Users may have been replaced by ATMs and online banking services when they go to other banks, but here at Wells Fargo, you can find branches most conveniently, and the most tellers are waiting for you like a god. As a result, Wells Fargo's service card has been launched, with strong user stickiness, a single user has purchased the most financial products, and the value mining has been achieved to the extreme.

If one of the two is more suitable, it can be summed up by a simple saying: you can't walk by the river without getting your shoes wet.

When the economy is growing, booming, and bubbles, innovative banks usually run faster, they serve emerging industries and markets, have higher gross margins, and their performance is growing rapidly. For example, in the 1990s, the United States won the Cold War, the economy penetrated globally, the information technology revolution broke out, and innovation flourished. In 1990, Citibank's stock price was $18, and in 2000 it grew to $400, an increase of 2,122%, topping the list.

In contrast, the conservative Wells Fargo rose by just 900% in that decade, much worse than Citi. However, the tortoise and rabbit race is not only a short-term sprint, but also a test of the survivability of the financial industry under the stormy seas. Every time an economic bubble is punctured, a group of pioneers who run ahead become martyrs.