33. Timeline

Where to begin?  Where to end?  So many events – external and internal – became part of the fabric of this story, it seemed appropriate to create a timeline, a summary to guide a reader through Hibernia’s disaster recovery.

Monday, March 6, 2005, was an appropriate starting point, with the announcement of a merger between Hibernia and Capital One.

An endpoint was less obvious, but eventually Monday, April 24, 2006 suggested itself.  This date became known inside Hibernia as “Customer Day One.”  It was the day during which the 135-year-old Hibernia name was retired and the enterprise officially became Capital One, N.A.  Although the story ends there, disaster-recovery activities continued.

Date
Event
Sunday
March 6Time - Logo
Merger:  Capital One and Hibernia announce a definitive merger agreement valued at approximately $5.3 billion in combination of stock and cash.
– HIB close (03/07/05): $32.24, up 21.3%.
– COF close (03/07/05): $76.00, down 2.7%.
Tuesday
July 5Time - Cindy
Hurricane Cindy:  Close to 8 p.m., the first hurricane-force storm of the season makes landfall 8 miles southwest of Grand Isle, LA.  First classed as a tropical storm, it later is upgraded to a Category 1 hurricane, with winds exceeding 74 m.p.h., storm surge of 4 to 6 feet and rain up to 7 to 9 inches.
–  Impact:  Flooding in LA, MS, AL, GA; 33 tornadoes in NC, AL, VA, GA, MS, LA, SC, MD; Power lost to 278,000 in New Orleans area.
–  Damage:  $320 million.
–  Fatalities:  1 direct, in GA.
Source: Wikipedia.com
Sunday
July 10Time - Dennis 2
Hurricane Dennis:  At 2:25 p.m. CT, this Category 3 storm drives ashore at Santa Rosa Island, FL, providing the Gulf Coast its second taste of the 2005 the hurricane season, with winds up to 121 m.p.h., storm surge up to 6 to 7 feet, and rain up to 13 inches.
–  Impact:  9 tornadoes in FL, 1 in GA; Rain in AL, MS, GA, TN, OH.
–  Damage:  $2.2 billion in U.S.
–  Fatalities:  42 direct, 47 indirect.
Source: Wikipedia.com
Wednesday
Aug. 3
Merger:  At 9 a.m. CT, in a special Hibernia shareholders’ meeting, more than 94% of Hibernia shares voting are reported in favor of the merger with Capital One.
Tuesday
Aug. 16
Merger:  The Federal Reserve System approves the proposed merger, clearing the way to close Sept. 1.
Monday
Aug. 29Time - Katrina
Hurricane Katrina:  At 6:10 a.m. CT, a huge storm slams ashore near Buras, LA, 63 miles downriver from New Orleans.  Growing to Category 5 in the Gulf, it makes landfall as a Category 3 with tremendous momentum, winds up to 120 m.p.h., storm surge up to 34 feet and significant rain.
–  Impact:  Flood, numerous tornadoes, damage area estimated at 90,000 sq. mi.
–  Damage:   $75 billion estimated.
–  Fatalities:  1,836 (at this writing).
–  Hibernia:  Hibernia Center, housing the mainframe computer, operates normally despite minor damage and flooding.
Source: Wikipedia.com
Tuesday
Aug. 30Time - Industrial Canal
Flood:  Canal breaches and massive flooding are reported in New Orleans.  Three canals are identified – Industrial, 17th Street and London Avenue.

Hibernia:  The mainframe computer at the Hibernia Center now is in jeopardy from loss of city water.  Loan portfolio assessments begin and the executive team assembles in Baton Rouge.

Water spills over Industrial Canal levee

Wednesday
Aug. 31Time - Rescue
Branches: Company announces that all New Orleans-area branches will be closed through Labor Day.

Rescue: At 5:30 p.m. CT, Steve Hebert wades from the Hibernia Center after evacuating 34 men, women and children (and 2 dogs) in life rafts.

Merger:  At 8:34 p.m. CT, Capital One and Hibernia announce a 7-day delay of the Sept. 1 merger “as a result of the devastation and disruption caused by hurricane Katrina.
–  HIB close:  $31.75, down 5.8%.
–  COF close: $82.24, up 1.1%.
Thursday
Sept. 1Time - Rescue 2Time - TX 2
Rescue:  At 7:30 a.m. CT, helicopters lift off Hebert’s group from the roof the Tulane Medical Center parking garage where employees and their families and others spent the previous night.  They fly to Houma, LA, then to Dallas with vital data tapes.

Branches:  In Houston, locations are “swamped” with evacuees.  Hibernia employees feed homeless customers.  A temporary branch is planned at the Astrodome.  The mainframe is down until a back-up computer can be brought up.  Other applications are affected – TouchPoint, ATMs, VRU and voicemail.  Branches run “blind.”

Customers:  A loan payment deferral program is announced for displaced customers.

Employees:  A hotline is established for 3,100 displaced employees to report their whereabouts.  (Later, Rita displaced another 500.)

Housing: Company begins finding lodging for hundreds of displaced employees.

Merger:  The companies announce results of consideration elections by Hibernia shareholders:  Cash – 32.7%, Stock – 54.4%, No election – 12.9%.  Close still set for Sept. 7.

Friday
Sept. 2Time - Mereaux
Branches:  74 closed, down from 107.

Systems:  Essential systems are down a second day.  At 8 p.m., the mainframe is brought up for the first time since the Hibernia Center rescue.

 

Meraux branch is one of worst hit

Saturday
Sept. 3

Fairbank, Rich - IMG_0174 (2)

Branches: 67 closed, down from 74.

Systems:  After working all night, Dallas system engineers report the mainframe computer is online to support all functional branches.

Capital One:  Rich Fairbank announces a $1 million grant for hurricane relief on national telethon.

Loan portfolio:  Marsha Gassan, Rob Stuart and others work through the weekend on loan loss provision estimate.

Rich Fairbank, Capital One’s CEO

Sunday
Sept. 4Time - Reidy
Recon flight:  At 12:36 p.m. CT, Miles Reidy, Capital One merger coordinator, and Randy Bryan, executive team member, take an 85-minute helicopter flight over New Orleans with Wally Ford, structural engineer, to assess infrastructure damage.  Vital wharves, highways and utility towers appear intact.

Shared banks:  Louisiana Banking Commissioner John Ducrest supports a plan posed by Hibernia banker Kyle Waters for bankers from other institutions to share offices in New Orleans.

Miles Reidy on recon flight

Monday
Labor Day
Sept. 5
Vaults:  Cash recovery in damaged branches slows because of holiday vault-clock settings.

Loan portfolio:  Loan loss assessment and preliminary provision estimate of $175 million reported to Executive Management Team and to Capital One.

Tuesday
Sept. 6

Merger - Bryan Notebook (2)

Merger:  At an 8 a.m. CT, executive team meeting, Boydstun indicates Capital One seeks a change in merger terms and calls a special Hibernia board meeting.
–  1 p.m., directors meet by phone to consider renegotiation, then adjourn to allow more discussion between companies.

–  5 p.m., the Board reconvenes and authorizes lower consideration and new storm protection clause, subject to shareholder approval.

New formula:  For each HIB share, 0.2055 times Capital One’s five-day average share price (vs. 0.2261 originally) plus $13.95 in cash (vs. $15.35 originally).

Discount:  The new formula equals an approximately 9% discount from March 6 terms.

Wednesday
Sept. 7
Merger:  Before the New York Stock Exchange opens, Capital One and Hibernia announce amended terms.

Board:  At 9 a.m., Hibernia directors meet for update on merger amendment, news release, stock market reaction.
–  HIB close:  $29.86, down 4.9%.
–  COF close:  $79.45, down 1.3%.
Thursday
Sept. 8
Merger:  The two companies issue a news release about new voting procedures for Hibernia shareholders.  New terms must be approved, and shareholders must re-elect how they want to be paid.

Employees:  About 1,800 of 3,100 displaced Hibernia people are accounted for.

Sunday
Sept. 11Time - Duhon
Central money vault:  Hibernia’s southeast regional vault manager, Bobby Duhon, carefully opens the 24-ton door to the historic central money vault in the basement of New Orleans’ Main Office Building for the first time since the storm.  He recovers about $20 million in wet currency.  Floodwater damages contents of some of the 3,864 safe deposit boxes inside.  The vault has never before flooded in the building’s 84-year history.

 

Floodwater spills from vault

Monday
Sept. 12Time - Shared
Sharing:  16 “shared bank” locations – including  Hibernia offices – open in Jefferson Parish.  Banks with undamaged locations share space with other banks that cannot open their own facilities.

FDIC chairman Don Powell (later tapped by Pres. Bush to head the federal government’s Gulf Coast recovery effort) lauds the plan proposed by Hibernia’s Kyle Waters and implemented through the Louisiana Bankers Association.

Other banks have desks in Hibernia ‘Shared bank’

Monday
Sept. 12

Seal - manint and cookout 3 (2)

Systems:  Two teams of technology engineers buy camping gear, get immunization to re-occupy Hibernia Center before city is open.  They camp out in shifts for several days at a time in the still-impaired building.  Some use the rooftop for makeshift barbeques.

 

 

 

Robert Minint BBQs on roof

Wednesday
Sept. 14Time - Tower
Tower:  At 7 p.m. CT, the Hibernia Tower is re-illuminated for the first time since Katrina, an event captured by Los Angeles Times photographer Rick Loomis and published in many newspapers across the country.

 

 

 

Hibernia Tower shines

Monday
Sept. 19Time - Rejazz
ReJazz New Orleans:  Hibernia and Capital One announce a recovery fund-raising campaign, naming it “ReJazz New Orleans.”  Commemorative beads are offered to contributors.

 

ReJazz beads symbolize recovery

Friday
Sept. 23
Hurricane Rita:  Anticipating a Louisiana-Texas landfall of the second major storm in less than a month, Hibernia closes offices in the projected impact area.  Disaster plans are instituted incorporating lessons learned from Katrina.
Saturday
Sept. 24Time - Rita
Hurricane Rita:  At 2:38 a.m. CT, Rita roars ashore between Sabine Pass, TX, and Johnson’s Bayou, LA, as a Category 3 storm with winds of 115 m.p.h., storm surge of 6 to 8 feet and rain.
–  Impact:  Extensive damage to several southwest LA parishes and parts of southeast TX.
–  Damage:  $10 billion.
–  Fatalities:  7 direct, 113 indirect.
Monday
Sept. 26Time - Lake Charles
Damage:  Many offices re-open, except in hard-hit Calcasieu and Cameron parishes and Beaumont and Orange, TX.

 

 

Lake Charles: Hibernia’s landmark tower suffers significant wind damage.

Tuesday
Sept. 27
Merger:  The date for special meeting of Hibernia shareholders to vote on revised merger terms is set for Nov. 14.  Consummation date is set for Nov. 16.  Shareholders of record on Sept. 26 are eligible to vote.
Friday
Sept. 30
Offices:  Hibernia announces most offices open Columbus Day, Oct. 10, a normal bank holiday, “to help customers during this difficult time.”  In Lake Charles, the first office is opened since Rita.
Tuesday
Oct. 4News - Cap 1 Debit Card
Small business:  A special line of credit program is announced for small businesses affected by Katrina and Rita.

Red Cross:  Hibernia teams up with PayChex to assist the international aid organization in mailing thousands of disaster relief checks to Katrina victims.  Ten thousand checks per day for 30 days are expected to be distributed; all are drawn on Hibernia.

 

Red Cross emergency cash card

Wednesday
Oct. 5
ReJazz New Orleans:  Capital One announces a $150,000 donation to the relief fund.  Eventually, a total of $170,000 is disbursed to 12 New Orleans-area non-profit organizations.
Sunday
Oct. 9Time - Usher
Benefit concert:  Grammy Award-winning superstar (Raymond) Usher presents an Atlanta benefit concert supported by Hibernia to aid “Project Restart,” a fundraising program for the ravaged Gulf Coast.

 

 

 

Usher performs

Monday
Oct. 10
Lake Charles:  The badly mauled 21-story landmark tower in Lake Charles re-opens.  Temporary teller stations and retail services follow a week later.

Houston:  In a “Project Restart” initiative, Hibernia teams with Freddie Mac to give a home to a displaced New Orleans family.  Entertainer Usher takes part in the ceremony.

Thursday
Oct. 20
Earnings:  Capital One announces third-quarter earnings of $491.1 million, including a $44-million charge for Gulf Coast hurricanes; a $75-million impact from the unprecedented number of bankruptcy filings preceding new stiffer federal legislation; and that the delayed merger closing is not expected to have a material impact on expected integration costs or synergies.
–  HIB close:  $28.56, down 0.6%.
–  COF close:  $72.60, down 1.3%.
Friday
Oct. 21
Earnings:  At 7 a.m. CT, Hibernia announces a third-quarter loss of $58.1 million, after a charge of $175 million for potential loan losses related to hurricanes.  It is Hibernia’s final earnings release as a public company.
–  HIB close:  $29.17, up 2.1%.
–  COF close:  $74.45, up 2.6%.
Wednesday
Oct. 26Campbell, Bo 5
Final board meeting:  At 8:30 a.m. CT, Hibernia’s Board holds its final meeting, and directors hear a storm impact assessment from the Executive Management Team

Employee disaster relief:  $26 million expected by year-end 2005.

Dividend:  Directors declare a final dividend of 20 cents per share, payable Nov. 15, a day before the merger is to be consummated.

 

Bo Campbell, Hibernia’s last chairman

Monday
Oct. 31Time - Generator
New Orleans:  At 8 a.m., Hibernia’s New Orleans main office re-opens with the return of the Executive Management Team, led by Herb Boydstun, and others.  The building runs on auxiliary electrical power and air-conditioning units located on sidewalks.  Heat and hot water are months away.

 

 

Emergency generators on street powered bank for months

Wednesday
Nov. 9
Systems recovery: The Incident Management Team declares disaster recovery of information technology operations complete.  Significant employee housing and disaster relief continue.
Monday
Nov. 14Time - Merger
Final shareholder meeting:  At 9 a.m. CT, in a special meeting in Houston, approximately 59% of outstanding Hibernia shares are voted in favor of the new merger terms.  Herb Boydstun and Cathy Chessin, corporate secretary, complete final documents.

Consideration:  Preliminary results indicate 18.9% of outstanding shares voted in favor of cash and 68% for stock;  13.1% fail to make valid election.
–  HIB close:  $30.58, up 0.6%.
–  COF close:  $80.91, up 0.1%.
Wednesday
Nov. 16Time - Cap 1
Merger:  Hibernia officially merges into Capital One with the filing mid-morning of merger certificates in the Secretary of States’ offices in Louisiana and Delaware.  In a welcome letter to employees, Rich Fairbank says it is the “most transformational move in the history of our companies.”
–  Bo Campbell, Hibernia’s last chairman, is named to the Capital One board.
–  HIB close:  $30.45, down 0.5%.
–  COF close:  $81.74, up 0.6%.
Monday
Dec. 5Time - FSRT
Financial Services Roundtable:  Hibernia coordinates a visit by some 30 financial industry lobbyists to New Orleans.  Group tours city after hearing Mayor Ray Nagin and others.  They pledge help with relief legislation and fundraising.
–  Result:  In an April 2006 report, FSRT notes $93 million raised by financial institutions for Katrina relief.
Wednesday
Dec. 14
Recognition:  Hibernia’s Executive Management Team is recognized for disaster recovery efforts at a dinner hosted by Rich Fairbank in McLean, VA.  “I’m proud of the things you did and lift my glass to the new history we will create together,” he says.
Saturday
Dec. 31
Hurricane season end:  2005 sees a record 27 named storms.
–  Hurricanes:  15, a record.
–  Category 5:  A total of 3, a record – Katrina, Rita, Wilma.
–  Strongest:  Wilma.

–  Costliest:  Katrina.

Named storms:*  Arlene, Bret, Cindy, Dennis, Emily, Franklin, Gert, Harvey, Irene, Jose, Katrina, Lee, Maria, Nate, Ophelia, Philippe, Rita, Stan, Tammy, Vince, Wilma, Alpha, Beta, Gamma, Delta, Epsilon, Zeta.
–  Start, finish:  Arlene, June 9; Zeta, Dec. 30.

–  Retired names:**  Dennis, Katrina, Rita, Stan, Wilma

*  Italics denotes hurricanes.
**  When hurricanes are particularly destructive, their names may be retired from the list of usable names kept by the World Meteorological Organization.
2006
Thursday
Jan. 19
Year-end results:  Capital One reports earnings per share (diluted) of $6.73 for 2005, an 8.4% increase from $6.21 in 2004.  Total earnings rise 20% to $1.8 billion from $1.5 billion.  Fourth-quarter 2005 earnings increase to $0.97 per share (diluted), or $280.3 million, from $0.77, or $195.1 million, in fourth-quarter 2004.

Hibernia impact:  Results include a $30.6-million contribution to net income after the Nov. 16, 2005 acquisition of Hibernia.  The 2006 outlook includes about $90 million of integration expense.  Of 323 branch banking offices, 300 are open and operating.
– COF close:  $85.52, down 0.6%.
Thursday
Feb. 2

Royal Ridge

 

Royal Ridge facility:  The bank announces a move of some back-office functions to a facility in Irving, TX (Dallas-Fort Worth area) to make the company more resilient in disasters and to support expansion in Texas.

Jobs:  350-400 people are given option to relocate.  Moves are to be phased throughout the year, beginning first quarter.  The largest departments affected are Loan Operations and Loan Administration.

 

New Texas facility at Royal Ridge

Wednesday
Feb. 8Time - Fairbank
Bank rally:  At a 9 a.m. meeting in New Orleans of Hibernia consumer bankers in New Orleans, Rich Fairbank says, “The hurricanes were a defining moment.  What you did was the most unbelievable thing I’ve seen in business.”

Fairbank also tours the city with Herb Boydstun, Miles Reidy and others, viewing the still badly damaged Lower 9th Ward, eastern New Orleans, Gentilly and Lakeview areas.

Reidy, Fairbank examine damage

Tuesday
Feb. 21
Economy:  In an analysis sponsored by Hibernia and Capital One, renowned Louisiana economist Dr. Loren Scott finds New Orleans trails other communities in hurricane recovery.
Sunday
March 12
Acquisition:  Capital One announces it will acquire North Fork Bankcorporation, Inc., a nearly $37-billion-deposit Long Island-based organization with 355 offices in New York, New Jersey and Connecticut.  The stock/cash deal is valued at about $14.6 billion, representing a 23% premium.
–  Hibernia is to become part of the larger banking segment that will include North Fork once the merger is complete.
– COF close (03/13/06): $83.10, down 7.6%.
Thursday
April 20
Earnings:  Capital One reports record first-quarter results across its diversified portfolio of businesses, with earnings per share (diluted) of $2.86, a 44% increase from first-quarter 2005’s $1.99.  Total earnings of $883.3 million rise 74% from $506.6 million in the year-ago period.

Banking segment:  Net income is $43.3 million from most of Hibernia’s historical business and Capital One’s branchless deposits, including integration expense, corporate allocations and purchase-accounting impacts.
– COF close:  $83.57, down 0.3%.
Monday
April 24Time - TX
Brand Day One:  Capital One brings its signature “no hassle” approach to Texas and Louisiana banking as Hibernia officially adopts the name and appearance of Capital One’s national brand.  Coincidentally, the date is exactly 33 years to the day after Hibernia became a bank holding company in 1973.  In a news release, Herb Boydstun reassures customers that “everything (they) like about Hibernia remains unchanged.”

The Tower:  The trademark atop the bank’s New Orleans headquarters building “will continue to shine brightly … and remain a symbol of … banking excellence in the years ahead,” Boydstun says.
– COF close:   $85.56, down 0.6%.

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