• Jeff Matthews

Now That’s An Idea That Would Never Fly

Former BB&T* CEO John Allison has written a book about, well, about his time at BB&T, during which it grew from $275 million in assets to $152 billion (profitably) and some lessons learned along the way. American Banker, one of the publications Warren Buffett reads every day, is publishing excerpts from the book, covering everything from how BB&T got into the subprime auto lending business to how it looks for acquisitions (100 and counting during Allison’s 35 years at the bank). And while Warren Buffett has long lambasted American CEOs for not providing shareholders with honest post-mortems about acquisitions where big things were promised but not delivered, Allison makes Buffett look like a piker when it comes to the notion that deals ought to be scrutinized in hindsight. Here’s what Allison says, and it’s so logical you wonder why everybody doesn’t do it. Well, actually, you understand why they do not… Of course, the economics had to work from our shareholders’ perspective…In this regard, the board members were told that for 10 years after an acquisition was effected, they would be provided with a report on how well the acquisition performed relative to our projections. It is tough to remind your board for 10 years that you made a significant mistake, so this discipline encouraged rational, objective analysis. JM 11/17/14 *Your editor has an interest in BB&T, just for the record, but we would have published this even if we didn’t.

0 views0 comments

Recent Posts

See All

Donald Immelt?

“It became clear right away that my main role would be Person to Blame,” Mr. Immelt writes in his new book “Hot Seat: What I Learned Leading a Great American Company,” which will be published Feb. 23.

Spot the Non-Sequitur

First, this headline from the Wall Street Journal, February 5, 2021: Bill Gates Joins Private-Equity Firms in $4.7 Billion Deal for Private-Jet Company Private-jet travel is booming amid travel restri

BROWSE CATEGORIES

Stay up to date with an insider's look into The World of Wall Street.

Great! You're all signed up.