HOW THE SAN FRANCISCO EARTHQUAKE CREATED DISNEY

Yes, you read that right. One could argue that the 1906 San Francisco
earthquake created Disney's success or, more correctly, that it made
Disney's success possible. When the massive earthquake hit, the
devastation was near-total, with massive fires following the quake's
devastation. All the major banks were destroyed. They could not open
or even get to their vaults, with cash and records inside. But one
very small bank was able to access its cash. The two-year-old Bank of
Italy, started by Amadeo Giannini, serviced poor immigrants that the
large banks would not lend to.

Giannini put a board across two barrels and so had a desk on the
street outside his destroyed building. He then lent cash to all who
applied, whether past customers or not, for day-to-day needs, and for
rebuilding, their signatures being satisfactory. Later, he was always
proud to say that every loan was repaid. San Francisco in 1906 and
California in general was still cut off from the rest of the country
in the best of times. After the earthquake the city was isolated for
many weeks. Giannini's belief in his city and its people was rewarded
by the loyalty of millions of people who moved to the “caring bank.”

Today that small company is the second-largest bank in the United
States, now called the Bank of America. A.P. Giannini continued to run
the bank and while it was not always a smooth relationship, the bank
stood by the Disney brothers when it counted. Two stories tell the
upside. SNOW WHITE AND THE SEVEN DWARFS, the first Disney feature, was
in financial trouble halfway through its production phase. More money
was needed to complete it, and their bank was sending over one of its
key decision-makers to see what this cartoon was all about and see if
they would put any more money into it or close down production.

One Saturday morning the Disney brothers screened for Joe Rothenberg
what had been completed, showed storyboards and sketches to the man,
who took it all in without saying a word, even as he got into his car
to leave. He finally said to the anxious brothers as he pulled away
“That thing is going to make a hatful of money.” And of course, it
became the highest-grossing film yet made.

In the 1940s, with world war two decimating their income (much of
which normally came from other countries) Disney faced closure. Its
debt to the bank had soared and they needed more just to stay open.
The board of directors called in the Disneys for a meeting, where they
presented their case. Almost to a man the board members said they
should not get a further loan. Then Mr. Giannini spoke. He asked his
directors if they had seen BAMBI and if they had seen DUMBO. Most had
not. He said he had, that he enjoyed them and that what the Disneys
were doing was good for people and good for the film industry which
the bank was by then supporting heavily. The loan was approved.

Yes, there were times when individual films were refused funding and
even the crazy idea that was Disneyland was nor bank approved or
financed, leaving Disney to finance it with other partners (Paramount,
Western Publishing and the new ABC Television Network) only to sell it
to his own company years later at a good price. But when it really
mattered, when the company's survival was at stake, the bank acted as
it should have in those cases.

These were the days when bankers were bankers and not computer
operators. In assessing a loan, a person's character and track record
was a factor along with financial factors. Banks took risks and
overall they paid off and made the strong economy we once had. Though
Disney said “a banker is someone who'll give you an umbrella on a
sunny day” he did better than one would have expected with them. Of
course he had his brother Roy handling the business side of things,
and his contribution and importance was equally creative and
essential.

I can remember the days when bankers were judges of people and not
just numbers that computer programs evaluate anyway. Disada had no
business getting the bank loans that started it, and we had to go to
over a dozen banks before one agreed. They saw something beyond the
numbers and took a chance. That branch is still our bank, over forty
years later. A bank by the numbers is as creative as a paint by number
picture. In the film industry it means that most funding goes to
sequels, pre-established plays, books, comic books and over-the-hill
old TV series crap.

The San Francisco earthquake let the Bank of Italy become the Bank of
America. And the Bank of America let the Disney brothers become
Disney..