McColl: Storrs was Best at Thinking Conceptually

Thomas Storrs, the former chairman and chief executive of North Carolina National Bank, died last week at the age of 93. From 1974 to 1983, he ran the bank that would eventually become NationsBank and then Bank of America Corp., shaping a daring strategy to expand beyond North Carolina's borders. Under his watch, NCNB pioneered interstate banking by using a legal loophole to aggressively expand in Florida and, later, throughout the Southeast.

Hugh McColl Jr. succeeded his long-time mentor in 1983 and continued the company's transformation into a coast-to-coast powerhouse. In an interview with American Banker Tuesday, McColl shared his fondest memories of Storrs and reflected on the former executive's legacy at Bank of America and on the banking industry as a whole. Here is an excerpt.

What are your biggest takeaways from Tom Storrs?
HUGH MCCOLL: I started working for him in 1966 when he was in charge of banking. Storrs was a very organized person. He always was interested in facts and getting the facts to make a decision. He was very diligent about that. If you wanted to make a point with him or carry an argument with him, you had to be well armed with facts and logic. Your conclusions had to be logical. That was my number one memory of him.

He ended up being a great CEO because he had the ability to think conceptually and strategically about things. Under his leadership is how we escaped North Carolina. He had put together a team of mid-level managers with the task of getting us out of North Carolina. They came up with all kinds of ideas. For instance, we thought about converting our finance company offices into industrial banks to branch in other states. So he was always thinking about how to grow the bank profitably and how to get out of the trap of being just in North Carolina.

He taught me how to identify a problem, develop a solution for it and then execute on it. He was very good at all those things.

People often link your name to the bank's growth, but isn't it true that Tom Storrs was a key part of that strategy as well?
The truth is I really continued a strategy developed by [former CEOs] Addison Reese and Tom Storrs. It was a really simple, straightforward philosophy, which was to build dominant market share in large and fast-growing markets and, where possible, to leverage our existing infrastructure. That was it, and it never changed through three chairmen. I was simply the third in a line of people who executed the same strategy. I just happened to be there when [the banking laws changed]. Certainly, Tom was at the cutting edge of that. We really had discussions about merging with Barnett [Banks Inc. in Jacksonville, Fla.] prior to the laws changing. We had very serious board meetings about it, trying to figure out how to take cross investments in each other to prepare for what we thought was the inevitable future of interstate banking.

(NationsBank eventually bought Barnett in 1998.)

What is his legacy for the banking industry?
He was certainly honored among his peers. … Everyone respected his mind and the logical way he approached things. I think his legacy is that one should plan a great deal, have a system with checks and balances and that you have systems that produce facts so you can run a company. We developed software where the transactional operating systems produced consistent results to run the company, which a lot of people didn't have. You could argue Mr. Storrs believed in having only one company with one set of executives. We only had one holding company. We didn't have a confederation of banks. That gave us efficiency and the ability to drive down costs for advertising and other things. That really kept everybody on the same song sheet, so to speak and it also made it easier to keep score.

How competitive was he?
Very. He was an intellectual but he was a tough competitor. He had to work from the time he was 15 years old really to support the family. But he was not a hostile person. He was able to confine his competitiveness to beating you on the playing field and not trying to out talk you. He was a master of the English language. He never said anything that he didn't mean, and he never meant anything he didn't say. So if you tried to read between the lines with Tom you were in the wrong place. He handled the language so skillfully. I always thought was interesting. I learned that what he said was what he meant, and nothing else.

What will you miss about him the most?
I will miss our ability to talk conceptually about the industry and the economy. He was very analytical. He came out of research with the Fed. He had a Ph.D. in economics. I never thought Tom was 'a great banker,' but he was a great CEO. Those are two different things. He knew how to run the business and he knew how to control risks because he understood that really well and he hired the people he needed to control risk. He was very good at understanding the business itself without being a great lending officer. He never really tried to do that. I miss having dispassionate intellectual discussion. I miss that a lot. We could talk about Europe, for instance, and he would look at the facts. I would talk to him about personnel decisions and business decisions, always.

How much did he follow current industry events?
He was very much up to date on what was going on and very aware of it. He wasn't given to making pronouncements about it. He basically was a student and he had observations about it. Obviously, he had informed opinions and he always had good contacts. His view would be that one should understand the risks they are taking and should disburse them so you don't have all your eggs in one basket. You learn to try and understand the macro economy because at the end of the day it is going to affect your bank, as opposed to thinking you can operate outside the norm and get away with it. He certainly didn't believe that. He was conservative in terms of the risk taking, but was aggressive in terms of expansion. He was willing to take chances to try anything to get out of the trap of North Carolina.

Any other thoughts about his leadership?
His lasting thing for NCNB was that he created a meritocracy where people were judged on their performance as opposed to what school they went to. We had a true meritocracy, and he deserves credit for that. He forced us into the discipline of looking only at the truth as opposed to what someone would hope would be the truth.