USA > New York > Bronx County > The Bronx and its people; a history, 1609-1927, Volume II > Part 21
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The Commonwealth Savings Bank opened May 9, 1910, at No. 2007 Amsterdam Avenue. As business expanded and larger quarters were needed it moved to its present location, No. 2039 Amsterdam Avenue corner of 161st Street. Alexander Grant is president, George H. Hyde, Martin Wallace and Robert L. Jones, vice-presidents; Frederic Burk- hardt, secretary, and Dr. Gustav Scholer, treasurer. Herman W. Beyer is chairman of the executive committee.
State Bank-In October, 1913, the State Bank opened a branch on Westchester Avenue at Union Avenue. This was opposite its present location at No. 801 Westchester Avenue. Joseph A. Seckinger, who is now assistant vice-president of the bank, in charge of the West- chester branch, was then paying teller. This bank maintains another branch at No. 822 East Tremont Avenue, under Charles A. Wells, and one at No. 1046 Southern Boulevard, with Charles P. Ranges as man- ager. All the managers are Bronxites.
The Chatham Phenix National Bank & Trust Company came to Harlem in 1915, taking over what were formerly parts of the Century and Security banks at 116th Street and Lenox Avenue, and 125th Street and Lenox Avenue. In 1917 the branch at 144th Street and Broadway was opened. F. B. French, vice-president, is now manager of the 116th Street branch, Robert C. Stafford is at 125th Street and H. G. Cooper- man supervises affairs at the 144th Street offices.
The Public National Bank opened its first Bronx branch in 1913. A. S. Bernstein, now vice-president, was appointed manager of the
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VIEW SHOWING CORN EXCHANGE BANK ON RIGHT
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branch at Claremont Parkway and Bathgate Avenue. Morris Meltsmer is the present manager of this branch which is now located at No. 3817 Third Avenue. The next branch was opened in 1922 at No. 982 Southern Boulevard. Morris Cohen is manager of this office. Other uptown branches opened subsequently are at 116th Street and Madison Avenue, 138th Street and Willis Avenue, 163rd Street and Prospect Avenue, 180th Street and Crotona Parkway, 160th Street and Broadway, No. 273 East 169th Street, No. 26 West Burnside Avenue, No. 1453 Boston Road, No. 1605 Nelson Avenue and 149th Street and Prospect Avenue.
The Morris Plan Company established its first uptown branch in 1916 at No. 391 East 149th Street on the second floor. It now occupies the entire ground floor. Another branch is maintained at No. 940 Southern Boulevard, opened in 1924. Rhett R. Dufour is manager of the 149th Street offices and Thomas Loffman of the Hunt's Point branch.
The Banco di Napoli opened in 1918, at No. 353 East 149th Street, where it still is. A. Disilippi is manager in charge.
The Colonial Bank-In 1920, the Colonial Bank opened a branch at the corner of Fordham Road and Morris Avenue. It is now managed by Ralph P. Blake. The oldest uptown branch is at 116th Street and St. Nicholas Avenue, opened in 1900. Edwards Dietz is the manager. Other branches are at 174th Street and Broadway, 167th Street and Gerard Avenue, and at Sherman Avenue and Dyckman Street, in the Inwood section.
The Bank of the United States-The first Bronx branch of The Bank of the United States was opened March 28, 1921, at No. 928 Freeman Street, corner of Southern Boulevard. The manager is Frank Silverstein. Another branch, at 171st Street and Third Avenue, was opened January 8, 1927. S. B. Goldstein is in charge.
The Port Morris Bank was established in 1922 on the corner of Willis Avenue and 138th Street. Russell B. Smith is president, Benjamin Benenson is vice-president, and Gilbert C. Freeauf, cashier.
The Fordham Savings Bank, No. 2480 Grand Concourse, near Ford- ham Road, opened in 1923. William H. Steinkamp is president, J. J. F. McLaughlin, Charles H. Dahmer and John Stratton O'Leary, vice- presidents ; Christian C. Cramer, treasurer, and John Meyer, secretary.
The Bowery & East River National Bank opened in 1923 at 184th Street and Third Avenue. This is a branch of the Bowery and East River National Bank, and Lewis Battaglia is manager of The Bronx offices, and M. M. Appelbaum is assistant manager. The first quarters were at No. 670 East 187th Street. The present building was taken over in 1925.
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The Manufacturers Trust Company in 1923 took over what had been formerly the Westchester Avenue Bank, later the Tradesmen's Bank, and finally the Columbia Bank. The headquarters in The Bronx are at No. 1042 Westchester Avenue. George F. Frost is vice-president, and N. Ettinger, assistant-secretary.
Italian Discount and Trust Company-In 1923 the Italian Discount and Trust Company established a Bronx branch at No. 363 East 149th Street. This bank is now known as the Discount National Bank, but a merger is in the process of completion whereby this bank will be merged with the Bowery & East River National Bank. Joseph Orsi, assistant vice-president, is manager of The Bronx branch.
During 1924 a number of new banks made their appearance in the uptown section, and a few downtown banking institutions established contacts in the uptown section that year.
The Capitol National Bank was opened at No. 850 Longwood Avenue on June 5, 1924. B. J. Weintraub is manager. In 1926 this bank opened two additional branches at 146th Street and Broadway, under Elmer Marrah, and at Fordham Road and the Concourse, under William H. Henlotter.
The Hamilton National Bank of New York, the main office of which is at No. 130 West 42nd Street, opened its first branch above 110th Street, November 17, 1924, at No. 96 East 170th Street, near the Con- course, where Robert O'Leary, assistant cashier, is manager. The latest branch office was opened December 4, at 110th Street and Broadway, with Thomas J. King as manager. Another branch under J. D. H. Leary is maintained at 181st Street and Wadsworth Avenue.
Italian Savings Bank-In 1924 the Italian Savings Bank opened its only uptown branch at No. 204 East 116th Street. Humbert A. Van- nozzi is manager.
New York Title & Mortgage Branch-The New York Title & Mort- gage Company took over the building formerly occupied by the New York Telephone Company at No. 373 East 149th Street near Third Avenue in October, 1925, and remodeled it to accommodate its Bronx headquarters. Charles R. Van Anden is manager in charge. In 1926 the gross income of this company was nearly $11,000,000.
Fordham National Bank-In January, 1926, the Fordham National Bank was formed by Fordham men, and opened for business at No. 2 West Fordham Road at the corner of Jerome Avenue. Joseph P. Ryan is president ; Cyrus C. Miller, A. A. Koswick, and Harry Douglas are vice- presidents. William B. Allman is cashier and Roy H. Griffin is comp- troller.
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The Seventh National Bank opened its first and only branch at 116th Street and Lexington Avenue in February, 1926. Frederick C. Budenbender is manager and L. W. Loomer, assistant.
The Melrose National Bank opened in the Hub section, on the corner of 150th Street and Melrose Avenue, in June, 1926. The board of direc- tors, of which Charles S. Levy is chairman, is composed of local bus- iness men. William T. Keogh is president. Vice-presidents are Arthur Baumann, William Blumstein and Walter F. Copeland.
The Amalgamated Bond & Mortgage Company was established in December, 1926, by Herman Knepper, for thirty years a real estate operator and financier in The Bronx, and Edward Polak, former Register of Bronx County. The headquarters of this company are in the Knepper Building, Nos. 3118-20 Third Avenue, near 159th Street. This is the only local organization of its kind.
National Banks in The Bronx-Several of the banks in The Bronx are National banks. The National Banking legislation that came as a result of the Civil War vindicated Alexander Hamilton's theory that Federal control was essential to the banking operations of the country. Under the National Bank Act of 1863, passed as a war measure and several times amended, the banking area of the United States was divided into twenty-five regional groups, each under an examiner. In order to create a market for Government bonds, each bank, upon entering the National system, was required to invest at least one-fourth of its capital in United States bonds. Upon depositing these bonds with the Treasury they were allowed to issue notes to the value of twenty per cent of their bond holdings. By imposing a tax of ten per cent on notes issued by State banks, the Federal Government proposed to bring about the discontinuance of issue by State financial institutions and to give the National banks a monopoly of the issue privilege. After the war this monopoly was gradually accomplished. The first National bank to be opened for business under the new National Banking Act of 1863 was the First National Bank of Davenport, Iowa, which had been successfully organized by Austin Corbin who in later years became a prominent New York railroad financier and most active in the develop- ment of the Long Island Railroad. Salmon P. Chase, Lincoln's Sec- retary of the United States Treasury, was a strong advocate of the experiment of standardizing the banks of the country. He had hoped that the oldest bank in New York City, the Bank of New York, would enter the system as the First National Bank, and that the other banks would take the numerical designation in the order of their entrance. But the older banking institutions of New York were unwilling to give up historic names under which they had established their business
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reputations. When the Secretary consented to inclusion of the title "National" in their old names, many of the well-known New York banks surrendered their State charters and became National institutions.
The First National Bank of New York was organized in 1863 as a product of the new law. It made its reputation in the refunding operations of 1879 when $500,000,000 worth of Government bonds were placed. It became one of New York's main reserve agents for inferior National banks. By 1866 there were fifty-eight National banks in New York City. In 1882 all of the National banks in the United States whose charters were about to expire were re-chartered for twenty years more. The National banking system, established in 1863, had inherent defects. As the Government retired its war bonds, the volume of circulating notes of the National banks was consequently reduced. Moreover, the fluctuating value of the bonds had made a variable paper currency. Strict adherence to the provisions of the Act limiting a bank's issue of notes to its bond ownings, kept currency "sound, but inelastic," the most frequent criticism of the system. The Act created no machinery for a National Clearing House, it made no provision for foreign exchange; but it did contribute to the financial progress of the country by doing away with the evil of discounting bank notes, on which the brokers of the country had been taking an estimated annual tax of $6,000,000 from the public. It prepared the National structure for the Federal Reserve System, but that was not given to the country until half a century later.
Federal Reserve System-As the relations of the banks to the Goverii- ment under the National Banking Act of 1863 may be likened to the loose confederation of the colonies under the Continental Congress, so their firm organization under the Federal Reserve Act of 1913 may be compared to the organic unity of the States under the Constitution. In the ironic way that history has of reconciling issues that once bitterly divided men, the Federal Reserve Act, embodying the triumph of the idea of Federal control, advocated by the father of the Republican Party, Alexander Hamilton, was signed by a Democratic President, Woodrow Wilson, on December 23, 1913. The plan of the Federal Reserve System divided the United States into twelve districts, each containing a Reserve city with a central bank, to which the banks of the district were to subscribe capital. The minimum capital required for opening a Reserve bank was set at $4,000,000, and all National banks were required to join the system. State and other types of banks and trust companies might, of their own volition, enter the Reserve system, upon complying with its conditions of membership. Under the new law members may be authorized to conduct a trust business and they may also open foreign branches. The cities chosen as centres
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of banking reserves for their financial territory were: Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas and San Francisco. New York City was the natural centre for District Number Two in the Federal Reserve System, which includes all of New York State, twelve counties of Northern New Jersey, and the border county of Fairfield, Connecticut.
The Federal Reserve Bank of New York was organized and ready for business by November 16, 1914, the date set for the opening of the Reserve banks in all the twelve districts throughout the country. The outbreak of the World War in August, 1914, and its immediate depres- sion of the American money market through the sudden withdrawal of European capital, hastened the preparation of the system with an authorized capital of $19,931,700 and a membership of four hundred and eighty banks. Of this number there were thirty-three New York City banks, all of them National banks, which had a year only to choose between affiliation with the Federal Reserve Bank or forfeiting their charters. Each of the member banks was required to subscribe six per cent of its paid-in capital and surplus. Of this amount, one-sixth was to be paid on call; one-sixth three months after; one-sixth six months later; and the remainder on call. The stock of the Reserve Bank was not to be transferred or hypothecated. Only the stocks held by the banks carried voting power. In New York the required capital was so over-subscribed by the original bank members that private buyers had no chance at the stock. In every sense the new institution was essentially a bankers' bank. Benjamin Strong became the first Governor of the New York Federal Reserve Bank which, for the first ten years of its operation, has been under his admirable management.
In the new era of banking, inaugurated by this comprehensive scheme of National organization, the older banks of New York City gave co- operation from the start. The National City Bank had the honor of being the first of the Metropolitan banks to deposit its reserve, and to secure the first receipt signed by the Federal Reserve Bank of New York. The amount deposited by this famous old bank was $21,000,000, which was $5,000,000 above its required proportion. The American Exchange Bank deposited $2,000,000 in excess of its required sum, $5,500,000. Other great banks deposited as follows: the National Bank of Commerce, $9,000,000; First National Bank of New York, $8,000,000; the Chase National Bank, $8,000,000; the National Park Bank, $6,- 500,000; Hanover Bank, $6,200,000; Mechanics and Metals National Bank, $5,400,000; Chemical National Bank, $2,100,000; Seaboard Nation- al Bank, $2,000,000; and Citizens Central Bank, $1,400,000. The Chemi- cal National Bank made the first application for a rediscount from the Federal Reserve Bank, thus leading the way to contributing to the credit of the country, as it had done before in the panic of 1857, when
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it was the only bank in New York City, which did not suspend specie payment.
At its first appearance as an individual financial institution at the Clearing House, the Federal Reserve Bank of New York turned in $12,538.08 in checks and had against it an account of $1,000,000. The bank has constantly increased its membership and therefore its re- sources. It has gained the support of the banking world of New York. At the end of the first decade of its activity, it counted as members 694 National banks, fifty-five State banks, and eighty-nine Trust Com- panies throughout its district, a total membership of 838 banking in- stitutions. Its resources demonstrate the enormous financial strength of the Reserve System.
Within the first ten years of its history the Federal Reserve System accomplished the primary purpose of its wise designers. No panics have occurred in the United States since the system was adopted, nor does there seem any likelihood that a future panic could gain sufficient momentum to develop that disturbance of financial conditions which reappeared with uncomfortable frequency in years now happily past. Even in the early period of the European War, which brought the most severe test to which any banking system could be subjected, the United States was saved from financial upheaval by reliance on the citadels of credit represented by its reserve banks. The Federal Reserve Bank had its first headquarters at No. 65 Cedar Street, but later moved to larger quarters in the Equitable Building. One of the cap-sheafs of New York's banking progress, as represented by architectural symbols, is the magnificent new building of the Federal Reserve Bank of New York, occupying the Nassau Street block between John Street and Maiden Lane, which became the permanent home of that institution in October, 1924. The new building is fifteen stories in height and five stories below the Liberty Street grade level and, with the exception of a small plot at the William Street end, occupies the entire plot bounded by Maiden Lane, Liberty Street, Nassau Street, and William Street. The building is one of the largest banking structures in the world, ample not only for its present staff of 2,500 but for larger future additions. The foundation work was the largest undertaking of that nature ever attempted in New York. The superstructure rests upon ninety-nine reinforced concrete piers extending down to bed rock. The entire building area was excavated for a depth of five stories below street grade, the piers being sunk the remainder of the distance to bed rock through pneumatic caissons. This necessitated the removal of 121,000 cubic yards of earth material and the use of heavy timbering to overcome the pressure of the neighboring buildings.
The new Federal Reserve Bank Building may, very appropriately, be called the "last word" in bank construction. Simplicity and utility
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have been the watchwords and the structure may be truly considered beautiful in both. Convenience of arrangement is noticeaable every- where, and many generations will have passed away before any traces of decay are likely to appear. The vault, located at the western end of the building, and quite below tidewater, rests upon solid rock footings. It is built in three levels served by adjacent security elevators. The easterly wall is ten feet thick, whilst the other three walls are eight feet thick. The material for these walls was selected after very ex- tended tests of the most indestructible combinations known to science, and it is not likely the Bank's reserves will ever suffer from physical attacks. The three main doors are equally formidable. They are cir- cular in form and arranged to revolve on a vertical axis within a heavy steel frame. Each door is ten feet thick and weighs two hundred and thirty tons. Within the vault a day force of between sixty and eighty persons are employed and a constant supply of fresh air is provided by mechanical means. On October 24, 1917, the Bank's Directors authorized the purchase of site and erection of building. By the end of June, 1919, a total of 46,084 square feet of land had been purchased at a total cost of $4,798,000. The work of clearing the ground was commenced on May 12, 1921, the corner-stone of the new building was laid on May 31, 1922, and the structure was pronounced complete and the Bank and its assets moved in during the week end, October 4-6, 1924. The entire cost of the building and its equipment totaled $14,000,000, approximately $4,500,000 less than was estimated. This is carried as invested capital and constitutes an asset of the bank to yield returns through savings in rent and the subletting of surplus space. It stands as an impressive monument worthy to commemorate the three hundredth anniversary of New York's founding, its com- mercial progress, and its expansion over The Bronx territory and the sister outlying boroughs. With the Federal Reserve System, which has its stronghold here, banks in The Bronx are linked up, both adding to and partaking of the strength of the vast organization it represents.
Bronx Banks and New York Clearing House-The great development of banking in The Bronx is shown perhaps more clearly than anywhere else in the increasing business done by its banks through the New York Clearing House. The idea of simplifying the banking business of Manhattan and its suburbs by means of a clearing house originated in Manhattan itself. To overcome the clumsy system of having porters of sixty different institutions go from one bank to another once a week, to balance the transactions between banks, always a cause of great loss of time and temper through the confusion involved, the leading banks of the city planned a clearing house, which began opera- tions in October, 1853. In 1849 there were but twenty-five banks in
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the city, but this number increased to sixty within a very few years and the "Clearing House Proofs" of March 20, 1857, which were official statements of member balances, listed fifty-five regular members. Co- öperation between the banks for clearing purposes had long before been suggested by Albert Gallatin. It had been opposed by conservative bankers as a "dangerous concentration of power," a revival of the old anti-Federalist spirit in its financial form. George Curtis prepared a constitution for the organization which was adopted June 6, 1854, and while the Clearing House was not yet prepared to meet the requirements of the great panic of 1857, in 1860, when business conditions became most acute, following the election of Lincoln, it issued its first certifi- cates. During each of the later great panics of 1873, 1893, and 1907, the Clearing House certificates were invariably the saving element in the credit crisis. During the impending panic of 1914 the banks de- pended on the Clearing House to support them through the unprece- dented strain at the beginning of the European War.
The first chairman of the Clearing House Committee, which is com- posed of five bank officers from the member banks, was Thomas Tileston, president of the Phenix Bank, and the first manager was George D. Lyman. He was followed in 1864 by William A. Camp, who was connected with the Clearing House for more than a quarter of a century. To Frederick W. Tappen and George Gilbert Williams the success of this great financial institution as a clearing house is also due. Toward the perfection of its technique they contributed their years of banking experience and their personal devotion, and their work in the panics from 1857 to 1893 fills many brilliant chapters in the banking history of New York. The process of financing the infinite variety of New York's business negotiations without the actual handling of money, which the New York Clearing House has effected, may be comprehended by the figures of a single year. For example, in 1922 the average daily clearings through the Clearing House amounted to $706,378,761, but by a system of balances and credits of the banks, only $69,644,619 was paid out in cash. As a result of numerous mergers and liquidations, which more than offset the new organizations, the present Clearing House memberships total only thirty-eight on the regular list, those including National and State banks and trust companies, alto- gether representing a total capital of $311,550,000.
It is curious to recall that the first idea of cooperative effort in making clearings between banks originated with the bank porters in 1850, or thereabouts, when they developed the habit of meeting on the steps of one of the Wall Street banks after completing their Friday rounds, and there concluded their final checkups between themselves. This custom brought about the first organization of 1853, when rooms were secured in the new building of the Bank of New York on the northeast corner
LORILLARD'S SNUFF MILL, BRONX PARK, 1892
BEARS' DEN (NATURAL), BRONX PARK
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of Wall and William streets and the Clearing House commenced opera- tions with a regularly organized staff of bonded managers and clerks. In 1896 the Clearing House moved to its newly erected permanent home in Cedar Street. The success of the New York institution prompted the banks of other cities to establish clearing houses of their own. There is of course cooperation between them, and thus a transaction in a Bronx bank may in a brief interval have its repercussion through the New York Clearing House in Chicago or some other distant city.
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