Business Hero John Allison: BB&T — The Bank That Atlas Built

by | Apr 25, 2013 | Business, Money & Banking

Ayn Rand asked the question, "Philosophy: who needs it"? Allison and BB&T have proven that businesses need philosophy -- Ayn Rand's philosophy.

An excerpt from Donald Donald and Andrew Greta’s I am John Galt: Today’s Heroic Innovators Building the World and the Villainous Parasites Destroying It (Wiley).


In November 2008, 30 days before his scheduled retirement, John Allison sat atop a black office tower in Winston-Salem, North Carolina, preparing to sign away his life’s work.

He’d spent 37 years, his entire career, at BB&T (or, more formally, Branch Banking and Trust Company). When he arrived in 1971, it was an obscure farm bank with 250 employees and $250 million in assets. Allison became president in 1987 and chief executive in 1989, and by 2008 he was the longest-serving bank CEO in the United States. Under his leadership BB&T had grown into a bank holding company with 1,800 branches sprawling over 12 Southern states and Washington, D.C., among the top 10 banks in all but one of those markets. BB&T has 30,000 employees and over $150 billion in assets, making it the 12th largest U.S. bank.

Now he was being forced to give substantial control of it to the U.S. government.

And not because BB&T had failed, as so many other banks had in the terrifying banking crisis of 2008. No, BB&T was being punished because it had succeeded.

BB&T had made no subprime mortgage loans. While other banks blew themselves up with high-fee negative amortization and “pick- a-payment” loans that supported a cancerous housing bubble, BB&T resisted temptation and wrote only conventional mortgages.

Yet after Congress enacted the Troubled Asset Relief Program (TARP), banking regulators forced even healthy banks to take government money, that is, to accept the government as a shareholder. That meant committing to pay the government hundreds of millions in preferred dividends, and giving up valuable warrants so that the government could later purchase common stock at fire-sale prices. Adding insult to injury, Allison had to sign a waiver that allowed the govern- ment to unilaterally change the terms of his compensation from the company he’d served for 38 years.

But he had no choice. BB&T was a strong bank, with more than enough capital and more than enough liquidity to see it through the crisis, and a strong loan portfolio. Yet his banking examiner from the federal government told him that the rules had suddenly changed.

According to Allison, “They called us and said, ‘Okay, we’ve had these capital rules forever, and you guys got a lot more capital based on those rules. But we’ve decided we’re going to have some new capital rules. And based on these new capital rules, we don’t think you have enough capital. Now, we don’t know what the rules are, but we’re confident that if you don’t take the TARP money, you won’t have enough capital.’ ”1

Allison knew that the bank examiner was just a messenger boy for his bosses in Washington, D.C., where the Federal Reserve under chairman Ben Bernanke was desperate to save a few insolvent mega- banks, even if the entire banking system had to pay the bill do it.

Allison says, “There were three large financial institutions in serious trouble in the capital markets.” Presumably he means Citigroup, Bank of America, and General Electric Credit. But Bernanke didn’t want to reveal to the public how weak these three really were — so all banks would be forced to take TARP money. “He felt like if he forced all the large banks, all the $100 billion banks and over, to participate, the market couldn’t figure it out. . . . It was a huge rip-off for healthy banks.”

Allison signed. He had to. He had adamantly opposed TARP when it was being debated. He thought it was wrong. He thought it was unfair. He thought it was unnecessary. But he had to sign. A Southerner who often expresses himself in gracious understatement, Allison says, “To be forced to do that with 30 days left in your career, on something you were adamantly opposed to in the first place, was not much fun.”

For Allison, it all had a certain sense of déjà vu. Specifically, as he puts it, “It is right out of Atlas Shrugged. I mean, it’s eerie. It is eerie. It is eerie.” And Allison should know.

BB&T is the bank that Atlas built. Its success, and its durability in a crisis that destroyed so many other banks, is testimony to the real- world, real-money impact of Rand’s value system: purpose, reason, and self-esteem. The crisis itself is testimony to the real-world consequences of the philosophy of Rand’s villains — the looters, the power seekers, and the altruists.




Allison became president of BB&T in 1987, and chief executive in 1989. He spread the word about Ayn Rand and got every- one on the bank’s management team to read Atlas Shrugged. But the Randification of BB&T kicked into high gear in 1994. That’s when Allison discovered Objectivism: The Philosophy of Ayn Rand, written three years earlier by Rand’s longtime associate and designated intellectual heir, Leonard Peikoff.

“Though I’d read all of Rand and agree with it,” Allison says, “I really, in retrospect, didn’t truly understand it. I understood its politics, and I understood parts of it, but I never was able to totally integrate it until 1994, when I read Objectivism: The Philosophy of Ayn Rand. And that was a huge integrating event for me, because I was able to really get it from A to Z.”

After years of promoting Rand’s ideas in a general way within the bank, Allison turned them into a formal system. Most big businesses have a mission statement. But Allison took it much further. For BB&T, he used Rand’s ideas to create a corporate philosophy. It became embodied in a lengthy booklet that Allison wrote himself, and that still serves BB&T substantially unaltered after all these years.

The Rand-based BB&T philosophy has been what Allison calls “a filter.” Not everyone accepts it, but the ones he wants in his bank do. “What I’ve found is that better people like the ideas.”

At first the BB&T philosophy doesn’t look all that different than the usual corporate pabulum. The stated vision is “To Create the Best Financial Institution Possible.” The mission is “To make the world a better place to live.”

But then we get to the bank’s purpose, and that’s when things start to get interesting. It was “purpose” that first attracted Allison to Rand —what he finds living is all about.

Our ultimate purpose is to create superior long-term economic rewards for our shareholders.

This purpose is defined by the free market and is as it should be. Our shareholders provide the capital that is necessary to make our business possible. They take the risk if the business is unsuccessful. They have the right to receive economic rewards for the risk which they have undertaken.

A Randian creed, indeed — it brings to mind some of the more flamboyant statements  by  Francisco d’Anconia, the  noble  and eloquent defender of capitalism in Atlas Shrugged. He said that “the most depraved type of human being” is the “man without a purpose.” And he said that “I want to be prepared to claim the greatest virtue of all — that I was a man who made money.”

For critics of Rand, such statements supposedly argue for greed and selfishness. For her admirers like Allison, they are the enshrinement of the honorable matter of earning one’s living with one’s own productive work.

For Allison, all companies exist to make money for their shareholders, though most pretend there’s some other more altruistic purpose. That’s a fundamental hypocrisy that undermines a business’s relationships with its employees. Allison says, “If you throw in a value system that has some kind of altruism, which most businesses do, then people know you’re not serious, because . . . you’re not treated that way, and you can’t be treated that way.”

A typical altruistic purpose is to claim, necessarily falsely, that the business is all about serving clients — as though shareholder profits were to be sacrificed to make customers happy. BB&T turns this on its head in the statement of purpose, saying that client satisfaction is an essential means to the end of shareholder wealth creation.

“. . . our  purpose, to  create superior long-term  economic rewards for our shareholders, can only be accomplished by providing excellent service to our clients, as our Clients are our source of revenues.”

If this sounds familiar to Rand fans, it should. Howard Roark, the rebellious architect hero of The Fountainhead, said, “I don’t intend to build in order to have clients. I intend to have clients in order to build.”

But does this focus on clients and shareholders mean that employees of BB&T are to altruistically sacrifice themselves? Hardly. The next point in the statement of purpose states:

To have excellent client relations, we must have outstanding Employees to serve our clients. To attract and retain outstanding employees, we must reward them financially and create an environment where they can learn and grow.

Shareholders, clients, and employees, all working to mutual benefit. Nobody sacrifices; everybody gains. Does this sound familiar, too? The great industrialist Henry Rearden explained it in Atlas Shrugged: “I do not sacrifice my interests to them nor do they sacrifice their interests to me; we deal as equals by mutual consent to mutual advantage — and I am proud of every penny I have earned in this manner.” Allison calls it the “trader principle.”

He explains, “We talk about the trader principle over and over again. . . . You never should ever take advantage of other people, nor should you self-sacrifice. What life is about is creating win-win relationships, figuring out how to get better together, and you ought to do that consciously. What’s in it for you is a fair question, but what’s in it for them? . . . And you do that internally and externally. You treat your clients the same way. You never take advantage of clients, but if somebody’s trying to take advantage of you, I’ve told our employees many times, they are people you don’t want to do business with.”

Finally, the statement of purpose brings it all together in one big integration of the trader principle:

Our economic results are significantly impacted by the success of our Communities. The community’s “quality of life” impacts its ability to attract industry for growth.

Therefore, we manage our business in a long-term context, as an integrated whole, with the ultimate objective of rewarding the Shareholders for their investment, while realizing that the cause of this result is quality client service. Excellent service will be delivered by motivated employees working as an integrated team. These results will be impacted by our capacity to contribute to the growth and well-being of the communities we serve.

For BB&T, imbuing employees with a coherent purpose isn’t just a human resources exercise. It’s a high-powered competitive weapon.

Every employee is encouraged to read Atlas Shrugged. Every employee is given a printed copy of the BB&T philosophy embodying Allison’s Randian value system. Every year Allison, and now CEO Kelly King (a longtime Allison intimate), gives a one-hour presentation before all employees renewing the bank’s commitment to the philosophy.

Where the rubber really meets the road is through semiannual performance appraisals, in which every employee from top to bottom is evaluated in terms of whether he or she successfully lived the BB&T philosophy.

For every single employee, from tellers to executive vice presidents, every single day, the Ayn Rand – inspired BB&T philosophy is the cultural glue the holds the far-flung organization together — and has kept it from getting into trouble while other banks have spectacularly blown themselves apart.

Ayn Rand asked the question, “Philosophy: who needs it”? Allison and BB&T have proven that businesses need philosophy — Ayn Rand’s philosophy.


An edited excerpt from Donald Donald and Andrew Greta’s I am John Galt: Today’s Heroic Innovators Building the World and the Villainous Parasites Destroying It (Wiley). Republished in Capitalism Magazine by permission of the author(s).

Donald L . Luskin is Chief Investment Officer of TrendMacro, an investment strategy and economics research firm. For over thirty years, he has been a leading figure in investment management and financial markets. He was formerly vice chair of Barclays Global Investors (now BlackRock) and is the founder of Investment Technology Group and Luskin appears weekly on CNBC’s Kudlow Report and contributes frequently to the op-ed page of the Wall Street Journal. He is the author of Index Options and Futures: The Complete Guide and editor of Portfolio Insurance: A Guide to Dynamic Hedging, both published by Wiley. Andrew Greta is an author and business executive with more than fifteen years of experience in the financial markets and currently holds an appointment with the College of Business at the University of Illinois in Champaign-Urbana. He formerly led corporate and business development at CME Group in Chicago. Greta is a former contributing editor for His articles on finance and investing have appeared in numerous national publications including SFO magazine,,, Online Investor, and Individual Investor.


  1. Since when are “fi” and “fl” represented by a single character, as they are all over this article?

  2. Great article by Luskin and Greta. This is a blueprint in how to make Objectivism a living reality. Imagine our society with a 100, 500, or even thousands of examples like this. John Allison is a real Objectivist hero who had great respect for Ayn Rand and demonstrated it in the real world instead of just talking about it like many so-called Objectivist intellectuals, who are next to helpless in the real world.

  3. BB&T is nothing like it was when Allison was at the helm. The corporate philosophy is not nearly as explicitly Objectivist as it was*, and the sorts of petty, underhanded behavior and poor customer service, famous amongst the “big banks” and so (understandably) reviled by the general public, has only increased.

    * For example, you should have seen the company’s “philosophy” section of it’s website circa 2004; it looked almost like the table of contents of OPAR. Today, while still admittedly implicitly Objectivist, one has to strain to call it anything but empty, anachronistic “corporate speak” at at time when it’s predecessor is needed even more desperately.

  4. I won’t doubt, from my armchair, that Allison had to sign on the dotted line. But, I do ask, why, specifically. Was it because the goons & kingpins, in & out of gvt., had legislation, regulations and maybe judicial decisions (but not, I say, law) backed by immense phys. pwr. ultimately from the people? Was it because Treas. Sec’y. Paulson threatened the bank with “grievous harm” (FORBES, 5/6/2013, PG. 13)? Was it because, with rule changes, the bank must take TARP money or it “won’t have enough capital.”? I bet it was one, two or all three of these.

    Allison was thinking of the best interests, in the circumstances, of the shareholders, the clients and the employees (incl. mgnt.) of BB&T. He had people, things & values to protect, for now at least, from the crooks & the criminal regime. I believe he’s trying now to establish longer-term protection at-large post BB&T, as head of CATO. But, he will have to change CATO from libertarianism to Objectivist. Mike Kevitt

  5. Allison statement about BB&T not participating in the sub prime mortgage market is false. BB&T referred loan applicants that could not qualify for a conventional loans to their subsidiary Lendmark Financial who markets sub prime mortgages and higher risk personal loans. How conveniently he skipped over this fact.

  6. Interesting that there is no mention of BB&T taking a 3.1 billion dollar bailout. I dont think Ayn Rand would have approved of this, they should have failed.

  7. That was the TARP mentioned.

  8. Having just visited the local branch, I’m (sadly) forced to agree with you.

  9. Check your browser; they aren’t showing up in mine.

  10. Which means BB&T did not use it’s capital to fund such loans. And the bank isn’t reticent about its relationship with or the function of Landmark:

    ” Lendmark Financial Services
    is a consumer finance company that specializes in providing direct and
    indirect consumer loans, first and second non-conforming mortgages, auto loans, home improvement loans, and merchant retail sales financing
    services. Lendmark operates out of 104 branch locations throughout
    Georgia, Tennessee, Virginia, Maryland, Florida, North Carolina, South Carolina, Kentucky, West Virginia and Delaware. ***In addition, Lendmark provides alternative mortgage and consumer loan products to clients unable to meet BB&T’s normal consumer or mortgage loan guidelines.*** Lendmark is based in Covington, Ga., and can be reached at 678-625-6500.”

  11. Sounds like a great coherent philosophy for savvy business people. Everyone working for the mutual benefit without sacrifice sounds wonderful. However, a question please: what does the Objectivist world have to say about the elderly, the infirm, the vulnerable, or–if I may–men and women who, through no fault of their own, lack the ability to contribute “as equals” in any economically meaningful way? Please do not use a tired image about all boats rising equally or job creators handing out minimum wage service jobs. I mean, right now, I am strong, mentally-sharp, white and male, so I can probably play this business game for another 30 or 40 years. I am worried, however, that your Objectivist children will turn on me when I can’t play the game anymore. Is that just too bad for me?

    It is difficult to image a philosophical system that takes as its starting point the human individual at the top of his human abilities, and the rest of them be damned.

  12. This banker should be hiding in shame for his actions and immature beliefs based on a work of fiction written by a degenerate.

    It’s fiction written for teenagers, you imbecile. And horrible fiction at that!

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