Chapter 893 The Core of the Future Polaris Consortium (2 Chapters in 1)

Xia Yu first opened the first folder and browsed it.

In addition to the basic information of Polaris Capital, it is the operation of the invested company.

Genentech, Amgen, Home Depot, Abbott... All companies have the situation, each company has first and second quarter earnings reports, and the business situation is clear at a glance.

It's just that most companies are in the early stages of development, so their financial reports are not eye-catching, and they have even been investing without output, but Xia Yu doesn't care, as long as he sees that the money is being spent.

After browsing, the situation of Polaris Capital was updated in his mind, and overall, no problems were found.

Xia Yu, who was relieved, closed the first folder and put it aside, and turned over the second folder.

After a closer look, I found that the first four pages were all directories, and there were 87 banks listed in the serial number. No wonder I opened the folder and found that the documents inside were so thick.

Thinking about it carefully, it has only been less than two days since Xia Yu called Peter Lynch to do this work when he was in New York and was about to come to San Francisco. This is too efficient.

If you do a good job, you must praise it. Xia Yu couldn't help but praise: "Peter, your work is very efficient, you did a good job!"

Peter Lynch said with a smile: "Boss, I have been paying attention to the banking industry before, especially in the first half of this year, the interest rate volatility of the banking industry has reached the highest level in the past ten years, so I have long ago asked people to collect information on the banking industry and see. Whether there is an investment opportunity, after you told me, I can just come up with it, and these 87 banks are the targets of acquisition value in the western United States."

Xia Yu immediately understood that because of the fluctuation of the exchange rate of the US dollar and the impact of inflation, there was indeed a banking crisis in the United States in the early 1980s. Thousands of banks failed, and the core banks of the top ten consortiums all failed. The total number of banks in the United States has dropped sharply from more than 70,000 to more than 50,000, and it took more than ten years to reach the number of more than 70,000.

This time the intelligence gathering work seems to be accidental, but it is in fact inevitable.

Xia Yu said with a smile: "Anyway, you did a good job."

Peter Lynch smiled, nodded slightly to Xia Yu and said no more.

Bowing his head again, Xia Yu first carefully browsed the catalogue, trying to find a bank that is still well-known in later generations. According to the historical trajectory, a bank that can survive and grow for more than 30 years is definitely the best acquisition target among the banks. .

don't say it,

When Xia Yu turned to the third page and saw the name of the bank in the first row, his eyes couldn't help but freeze.

WELLSFARGO!

Translated, it is Wells Fargo Bank!

The only AAA-rated bank in the United States in later generations, Wells Fargo, once known as the first bank in the universe, has alternated with Huaxia ICBC to sit on the throne of the first bank in the universe four times!

Although it was surpassed later, it is still one of the four major banks in the United States. Its market value has been around 200 billion US dollars, and it was even close to 300 billion US dollars at a high time!

The four major banks in the United States in later generations are Bank of China, Bank of America, Wells Fargo and Citigroup.

Of course the **** bank is. Morgan and Chase Manhattan Bank merged in 2000, and now the two before the merger are the financial core of the Morgan consortium and the Rockefeller consortium, respectively.

The later Bank of America did not change its name at this time. It was also called Bank of America. It was the largest bank in the United States and the second largest in the world. It was the financial core of the California consortium.

Not to mention Citibank Group, the core of the first Citibank consortium, the second largest bank in the United States and the third largest bank in the world.

Therefore, the only one of the four major banks in the United States that has a chance is Wells Fargo.

Although there are still dozens of bank names in the data catalog, but Xia Yu didn't have the heart to look at it at this time. No matter how brilliant the future is, can it be more brilliant than Wells Fargo?

Since Peter Lynch has put the information into it, it proves that Wells Fargo has a relatively high possibility of acquisition. Even if Xia Yu knew that Wells Fargo should belong to a California consortium, he also had a sense of expectation in his heart.

With expectation, Xia Yu turned to the location of Wells Fargo Bank according to the page number and read it carefully.

Wells Fargo, founded in 1852, is headquartered in San Francisco...

Because he cared, Xia Yu read it very carefully. After watching it for nearly 20 minutes, he had a clear concept of Wells Fargo at this time in his mind.

At this time, Wells Fargo was really only a medium-sized bank, and its activities were basically in California, and 60% of it was in southern California.

Moreover, the main business of Wells Fargo is very distinctive. It is a community bank. It can be said that it is dedicated to retail. The business of community banks accounts for more than 80% of Wells Fargo, and most of Wells Fargo's savings also come from community retail investors. The cooperation of large enterprises is more based on loans.

Because Wells Fargo has not yet been listed, it is not easy to collect information. The most representative of the data is Wells Fargo's 1979 annual financial report.

According to the annual report, as of December 1979, Wells Fargo had total assets of $21.4 billion and total loans of $15.6 billion, including $4 billion in personal home mortgage loans.

Although Wells Fargo's total assets are US$21.4 billion, it is a mid-sized bank in the United States, where the financial industry is developed. Wells Fargo's owner's equity is only US$830 million.

Owner's equity can be considered as net assets, because in accounting, owner's equity refers to the ownership of corporate investors' net assets. This includes capital invested by corporate investors, as well as capital reserves, surplus reserves and undistributed profits formed in the course of business operations. It is the source of enterprise assets, and the relationship is expressed as: assets = liabilities + owner's equity.

So don't look at Wells Fargo's total assets of 21.4 billion US dollars, but that money is all depositors, Wells Fargo is only escrow.

In 1979, Wells Fargo's net profit was $130 million.

The U.S. financial industry is in a slump right now. None of the top ten companies in the U.S. is a financial company. The general P/E ratio in the banking industry is now around five, which is still less than ten times the P/E ratio of the future when it was stable.

At a common price-to-earnings ratio of five, the unlisted Wells Fargo would be worth $650 million, less than Wells Fargo's net worth.

This undoubtedly sounds outrageous, but it is a fact now, whether it is Bank of America or Citibank, it is almost the same, and the market value is only a little over 10 billion US dollars.

The downturn in the financial industry has been dragged down by the overall environment, and also has a certain relationship with the global oil crisis. Now, five of the top ten companies in the United States are oil companies.

Having said that, this year, because of the overall environment, the inflation in the United States is quite serious, which has led to drastic fluctuations in the federal funds rate, which has triggered a series of negative consequences.

Last year, Wells Fargo's interest rate spread was around 4.47%, but the research team of North Star Capital calculated that the interest rate spread of Wells Fargo Bank this year will be lower than 4% this year, which means that this year's net profit will be lower than last year.

Not only that, because of the drastic fluctuations in the federal funds rate, Wells Fargo needs to pay more to absorb deposits from the outside world, but in response to market fluctuations, Wells Fargo’s benchmark interest rate has to be adjusted accordingly.

For example, according to the data, the preferential interest rate announced by Wells Fargo was 15%, which rose to 20% in April, but dropped to 11% at the end of July, but at the end of September, with the start of the Iran-Iraq war, the interest rate rose again. twenty one%!

This interest rate fluctuates in real time, but the interest rate on previous lending and bonds, etc., can be fixed.

Wells Fargo’s financial report last year disclosed that the average lending rate of the total loan amount of 15.6 billion was 12.7%, of which the lowest interest rate for bonds was 9.3% for US$ 1.67 billion, and the interest rate for personal housing mortgage loans was 5.37 billion. The second-lowest rate on $10,000 is 10.3%, along with real estate development loans and more.

Now with the rise in the federal funds rate, the market bond prices have fallen by more than 10%. If these bonds are cleaned up now, Wells Fargo will lose $160 million.

After all, there are about 9.5 billion US dollars of assets due in more than one year in all aspects. If all are calculated according to the loss of 10% of the bonds, these assets are cleaned up at this time. The loss of 100 million US dollars will reach 950 million US dollars, which exceeds the net assets of Wells Fargo of 830 million US dollars, and Wells Fargo will have to go bankrupt.

Fortunately, these assets mature in more than a year, and as long as the federal funds rate is below 10% before the maturity date of the assets, Wells Fargo will not be out of luck.

Even if this is the case, the analysis also evaluates Wells Fargo as a fairly conservative bank and a potential stock.

From this, we can imagine how much pressure other aggressive investment banks are facing in such a harsh environment.

It is no wonder that over the past few years, more than 10,000 and nearly 20,000 banking institutions have closed down. Even among the top ten consortiums, there are consortiums that cannot save their core big banks and watch them go bankrupt.

At the end of the data, I also made an analysis of the acquisition difficulty of Wells Fargo.

Although Wells Fargo belongs to the California consortium, the California consortium does not value it. After all, it is only a medium-sized bank that has not yet left California. The shareholding ratio belonging to the California consortium is about 43%, and it has not reached relative control.

In addition to Wells Fargo, the California consortium has more than a dozen financial institutions, including Bank of America, Western Bank, Safepac Banking Corporation, Wells Fargo Bank, and Crocker National Bank, etc. Which one is not bigger than Wells Fargo?

Not to mention multinational banks like Bank of America and interstate regional banks like Western Bank, but in the San Francisco area Wells Fargo is inferior to Wells Fargo and Crocker National.

Therefore, according to the analysis, the California consortium does not value Wells Fargo Bank. In the face of the current downturn in the banking industry and the huge risk of interest rate fluctuations, the California consortium must be worried about adding a foundation to the bank to resist risks.

But there are too many banks under the California consortium, and with their strength, there is also enormous pressure.

So as long as the bid is right, the California consortium will not refuse to sell the stake in Wells Fargo.

However, the analysis also mentioned that although Wells Fargo is a medium-sized bank, its investment is conservative and its ability to withstand pressure is relatively stronger. The California consortium also knows certain potential. If it wants to acquire, it does not rule out the suspicion of the lion's mouth on the board of directors of Wells Fargo, which is a conservative estimate. , the purchase price is more than one billion US dollars.

The figure of one billion US dollars not only did not make Xia Yu tangled, but he breathed a sigh of relief and was quite happy.

There is no doubt that Polaris Capital's analysis department underestimated Wells Fargo's potential, and Xia Yu would have made a similar judgment if he hadn't been a rebirth.

In his mind, the California consortium's assessment of Wells Fargo will be similar to the one in the current document, which is a great opportunity.

According to the situation of later generations, it is undoubtedly quite wise for Wells Fargo to focus on the development of community banks at this time, and the development model is excellent.

As long as it can adhere to this model and develop, it will still become the top big bank in the United States.

If it is acquired at this time, then the Optimus Prime of the Polaris consortium in the United States will be established, and it will not hesitate to confront the Bank of America of the California consortium, not to mention that he will add a golden finger halo to Wells Fargo, and the speed of development would be pretty amazing.

Therefore, Xia Yu did not hesitate at all, and stopped looking at the information of other banks, and handed the information directly to Peter Lynch. When the latter looked at the information, Xia Yu said solemnly: "Peter, give you one of the most important things. task, this Wells Fargo, you have to go all out to acquire it.”

"Don't say it's a billion dollars, even if it's 1.5 billion or even 2 billion dollars, it doesn't matter, I only have one to be fully acquired, and I will acquire it!"

"Polaris Capital and all of its companies need it!"

A flash of lightning flashed across Peter Lynch's mind, and while his heart was shaking, he instantly understood the purpose of the boss, Xia Yu.

The boss is going to take Wells Fargo as the center and attract all the companies under Polaris Capital to form a consortium!

He only felt the blood flow faster, and couldn't help but look at Xia Yu and asked, "Boss, do you want to create a consortium?"

Peter Lynch saw through his purpose at once, but Xia Yu was not surprised.

After all, Peter Lynch has been on Wall Street where there are many consortia for many years. He must have done a lot of research on the consortium, and it is normal to see it.

In the United States, where consortiums are rife, it is normal and common for large and small companies and family newspaper groups to form a consortium, so Xia Yu did not hide it, nodded and said: "Yes, I have this idea, so you understand the acquisition How important is Wells Fargo?"

Although I don't know why the boss caught a glimpse of Wells Fargo, Peter Lynch didn't ask. He was in high spirits, nodded boldly and said, "I understand, boss, don't worry, I will definitely buy Wells Fargo."

Xia Yu nodded, and because he cared, he exhorted Peter Lynch again uneasy: "Peter, now the oil crisis is breaking out, which has a great impact on the financial industry. We must seize the opportunity and strive for the Wells Fargo bought it, and it doesn’t matter if the price is high, of course, if you can lower the price, I will not be stingy with bonuses at the end of the year.”

Peter Lynch replied solemnly, "Boss, I won't let you down."

Afterwards, Peter Lynch hurried out of the office to build the Wells Fargo acquisition team.

Xia Yu stayed in the company until about 11:10, when he received a notification from the employee, he immediately called Li Wuming to go downstairs and prepare to go back.

The person he was waiting for had come, and it was time to go back.

PS: Due to work reasons, I can only code words late at night, please forgive me, this chapter is 4200 words

Dear, click in and give a good comment. The higher the score, the faster the update. It is said that those who give full marks to the new ones have found a beautiful wife at the end! The mobile station is newly revised and upgraded. The address: , data and bookmarks are synchronized with the computer station, no advertisements Fresh reading!