A history of Wilkes-Barre, Luzerne County, Pennsylvania : from its first beginnings to the present time, including chapters of newly-discovered early Wyoming Valley history, together with many biographical sketches and much genealogical material. Volume V, Part 8

Author: Harvey, Oscar Jewell, 1851-1922; Smith, Ernest Gray
Publication date: 1909
Publisher: Wilkes-Barre : Raeder Press
Number of Pages: 734

USA > Pennsylvania > Luzerne County > Wilkes-Barre > A history of Wilkes-Barre, Luzerne County, Pennsylvania : from its first beginnings to the present time, including chapters of newly-discovered early Wyoming Valley history, together with many biographical sketches and much genealogical material. Volume V > Part 8

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One of the banks that had failed to function was a Wilkes-Barre institu- tion. Its life had been snuffed out, fortunately, while it was still in embryo. The Susquehanna Bankt of Wilkes-Barre was one of the institutions char- tered, but apparently its promoters were unable to bring their banking plans to consummation in time to participate in the manufacture of worthless paper. Joseph Sinton, who was the president of the Board of Directors, may have been the stumbling block. Certainly, this worthy old Quaker merchant was, in later years, widely known and respected for his exactness and honesty in all his trading. Bedford, in his "Early Recollections," writes: "The Quaker merchants, Jacob and Joseph Sinton, were most scrupulous and exact in all their dealings; most particular were they to see that full weight and full measure were accorded every customer . . . the Sintons, unable to return change to the half cent, would hand the customer part of a paper of pins or

*See Vol. III, pp. 1783-84.

See p. 1783, Vol. III.

needles of equivalent value." Men of this type would hardly wittingly give their name to a banking promotion of doubtful prospect. The record has it that "a wave of hard times" prevented the Susquehanna Bank "from ever opening its doors to the public," though it seems that its preparations reached even to the stage of having plates made for the issuance of its own bank notes.

The next Wilkes-Barre bank to be organized, and the first, it seems, to come into operation, was the Wyoming Bank, now the Wyoming National Bank. At the time it was chartered, in 1829, there was only one National bank, the United States Bank. All other banks were governed by State bank- ing laws. As a matter of fact, even the United States Bank was governed in Pennsylvania by Pennsylvania law; indeed, it possessed a State charter, under which, in 1836-when political opposition again robbed the great National bank of its Federal charter-it tried to carry on. Had the shrewd Wilkes-Barre gentlemen identified with the founding of the Wyoming Bank, in 1829, foreseen the stormy decade ahead of them-the most disastrous in American financial history, made so by political interference with a sound National financial system-they would probably have hesitated and, after a little thought, resumed the normal course of their own affairs, shelving unused the banking charter they had secured. But they could not see the future, and Wilkes-Barre stood in need of banking facilities, controlled by Wilkes-Barre men. So, having been granted a charter on November 4, 1829, certain local men of substance associated to make use of it. William Ross, Henderson Gaylord, John N. Conyngham, William Swetland and Isaac Bowman were made "commissioners to receive subscriptions," and on November 16, 1829, the Wyoming Bank was organized. The first Board of Directors consisted of Benjamin Dorrance, who became first president ; William Ross, John N. Conyngham, William Swetland, George N. Hollenback, O. Collins, Ziba Ben- nett, H. Gaylord, James Nesbitt, Jr., Steuben Butler, Abraham Thomas and Miller Horton. 'Mr. Bennett acted as secretary "until a cashier should be chosen." The first cashier was Edward Lynch. Mr. Dorrance was the presi- dent until May 30, 1832. Then, upon the resignation of Mr. Dorrance, who indeed had sought to retire a year earlier, George M. Hollenback became president. He carried the institution through all the uncertainties and wor- ries of two financial panics-1837 and 1857-as well as through the strenuous exciting Civil War period. He remained at its head until his death, Novem- ber 1, 1866. He had lived through many crises. Andrew Jackson had gone back to the White House in 1832, vowing that he would tear down Democ- racy's foe, the United States Bank. In order to complete its destruction, he took from it the moneys of the United States. These he deposited with State banks. Probably none came to Wilkes-Barre, but the Wyoming Bank, in common with all other State banks, went forward with the swell of importance that all State banks derived from the Presidential favor. The removal of nine millions of National deposits from the United States Bank within nine months caused the latter to curtail its discounts. On the other hand, however, the State banks. Jackson's "pet banks" as they were called, were easing the situa- tion. Rising, over night almost, to dignity and importance to which they were unused, the State banks, as was to be expected, were over-reaching themselves in their emissions of paper money. Again, it was the day of the State bank. Again the country was to be showered with "shin-plasters" blown into the light air by flimsy institutions whose power to blow came from systems dan- gerously inflated by the knowledge that, almost in a night, they had been transformed from unimportant little citified bodies to great National figures, from small-town banks to National institutions, the chosen depositaries of the money of a great Nation.

The Wilkes-Barre institution probably was not one of those State banks that basked in the Presidential favor, but it had to live through, or expire dur-

ing, the exciting period, 1830-37, in which paper money in circulation increased from $66,628,898 to $149,000,000. In 1837, America had six hundred and thirty-four State banks, aggregating a capital of $291,000,000, against which had been issued $149,000,000 of notes and $525,000,000 of loans and discounts. Deposits were only $127,000,000. Some banks could show only one dollar in specie for every twenty-five of its issued notes. As a matter of fact, since the beginning of minting in 1792, the United States had coined barely $50,000,000, and of this the bulk had been exported to meet foreign obligations. Therefore, when Andrew Jackson, in denying the rechartering of the United States Bank. "stopped the balance-wheel which regulated the finances of the country," the State banks were expected to prove the compensating force. But the Presi- dent jolted the State banking systems out of all chance of preserving equilib- rium by his famous "specie circular," which required all payments for public lands to be made in specie. New York and Philadelphia banks suspended specie payments in May, 1837, and almost all the banks of the country fol- lowed their example.

In some parts of the country, where development had been phenomenal during the artificial period of seeming prosperity that had preceded the crash, the state of the people was deplorable. Whole communities sank into insolv- ency, and had it not been for the Bankrupt Law of 1840 many of the sub- merged debtors would never have emerged to solvency again. Andrew Jackson had been triumphant in his fight against the United States Bank, but his own fall from popularity came with dramatic suddenness. His case, thinks Dr. Lord, should be "a lesson to all future Presidents who set up their own will against the collected experience and wisdom of the leading interests of the country."

The country did not recover from the panic of 1837 for almost ten years, and politicians, as a rule, avoided banking legislation. The State banks did what business was to be done, and the average man did as little business as he could with banks. However, with the discovery of gold in California in 1848 and 1849, a new period of financial stability seemed to have come. Banking became more active in Pennsylvania, and in 1850 another "Act Regulating Banks" became law.

Once again, the courage that seems inevitably to come when pockets long empty begin to fill led the courageous and imprudent on much farther than they should have gone. The State banks, having no competition as financial agents, eased the money market. This was fortunate for there was so much to be done in that wonderful decade of railway pioneering. Undertakings that called for immense loans were begun with carefree optimism. In 1850, the country possessed only 7,000 miles of railways. During the next seven years 20,000 miles more were laid, the construction calling for $700,000,000 of bor- rowed money. Again, the country-through the State banks-had overstepped itself. Its footing had become so precarious that one slip-a "run" on one Cincinnati bank-sent the whole banking system tottering. Within a few weeks a financial storm "began to sweep over the country and strew it with wrecks." It swept overseas, indeed, for the mighty Bank of England "was saved only by a suspension of the operation of the Banking Act." Almost all Pennsylvania banks followed the lead of Philadelphia in suspending specie payments in September, 1857.

The recovery was rapid. however. The local banks resumed specie pay- · ments in February, 1858, although the industries of the Nation were not well upon their feet again in 1860, when the rumblings of approaching war brought uneasiness into banking circles. Pennsylvania had followed New York, in 1860, in introducing a system of "free banking," whereby chartered institu- tions might, without restriction, issue their own notes to the value of securi- ties they had deposited with the State. It was not a successful system, and the

day of the State bank was almost over. The question of a Federal banking system again became one of the most vital matters of business in the National Legislature. Congress and Senate were driven to the consideration of this partly because of the need of developing strong sinews of war, and partly to grapple with the ever-increasing evidences of counterfeited or altered bills. "When almost every bank had its own plates for six or more denominations of notes, the land was full of counterfeits and alterations." In 1862 there were counterfeits on the notes of two hundred and fifty-three banks, and on even the best notes a discount of as much as fifteen per cent. was exacted in busi- ness circles, to cover possible losses.

The United States Government decided, as one of the earliest war meas- ures, to borrow $50,000,000 from the State banks, issuing demand notes to that extent. In 1862 an issue of $150,000,000 of treasury notes was made. $50,000,- 000 of this being apportioned to wipe out the demand notes of 1861. The National Banking Law came into effect in 1863, and was amended in 1864. By this law a Currency Bureau, and Comptroller of the Currency, were made part of the Treasury Department, with power to authorize banking associations to handle National currency under financial advantages not possible to the State banks. The latter desired to come into the new system, and nearly all of the states made this possible by withdrawing from circulation their old notes, the banks taking new ones from the United States Treasury. Of the Pennsylvania State banks, fifty-seven entered the National system in 1863-65. By the year 1867, Pennsylvania possessed only six State banks, not counting savings banks. By 1869, Luzerne County possessed five National banks, and three savings banks, if one might include in the latter the Markle private banking house which twenty-five years later became the Markle Banking and Trust Company. The five National banks, giving them in the order in which they were granted Federal certificates to do business as National banks, were: The First and Second National Banks of Wilkes-Barre, certificates Nos. 30 and 104, respectively ; the First National Bank of Pittston, No. 468; the First National Bank of Plymouth, No. 707; and the Wyoming National Bank, of Wilkes- Barre, certificate No. 732.

With the full establishment of the National banking system, American banking had finally emerged from the precarious experimental period. Hence- forth, American banking was to go forward along safe and sane lines, and carry the country with prosperity into first place among the wealthy nations of Occidental civilization. More than once, since the Civil War period, has the National system been put to the test, but in each test the Nation has emerged financially sound-all classes being convinced of the advantage they derive in making the Nation the bedrock of the banking system. A very sharp financial stringency occurred in 1873-caused again by railway construction over- reaching the financial means-and some National banks failed, but "the one redeeming feature of the 'panic' of 1873 was the demonstration it afforded of the protection given by the National banking system. Securities deposited with the Treasury Department, against issuances of currency by the National banks that failed, made it possible for the Government to honor all the National bank notes issued." Banking, therefore, being set, by the National Banking Act, along the lines which it has, in general, followed ever since, the writer will devote the remainder of this review to a closer survey of the bank- ing history of Luzerne County.

Strange to say, the Wyoming Bank, in 1861, came into possession of the. site of the Susquehanna Bank of 1816. The Sinton store, a one-storied frame building at the corner of Franklin and Market streets, had for long been a landmark, and indeed the place of considerable business-probably the largest general store business in Wilkes-Barre during its time, which by the way was before that of the department stores. The store was torn down in 1860, and

MDCCCXXIX

WYOMING NATIONAL BANK

..... . YA STATIONAI DANE WHI VEC RADDE DENNISVI VANIA

the new Wyoming Bank Building erected. . The latter was opened on March 17, 1861. On January 19, 1865, the Wyoming Bank added "National" to its name, and as the Wyoming National Bank the institution has ever since been conducted. In November of the next year President Hollenback died. While most of his successors have held the chief executive office for lengthy periods, no Wyoming National Bank president has approached Mr. Hollenback's rec- ord of thirty-four years as such. Among his successors have been General William S. Ross, Hon. Ziba Bennett, Col. Charles Dorrance, Sheldon Rey- nolds, Andrew H. McClintock. The present officers are: Dorrance Reynolds, president ; Theodore S. Barber, vice-president, and C. M. Austin, cashier. At the end of 1926, the Wyoming National Bank had a paid in capital of $500,000 and a surplus of more than $1,000,000. Its deposits totaled to $5,454,800.

The First National Bank of Wilkes-Barre was evidently one of the first to apply for a National charter. It holds charter No. 30 of all the thousands of National charters that have been issued to National banks. The bank, organ- ized on April 14, 1863, was chartered on July 21 of that year, and opened its doors for business two weeks later-on August 8, with a capital of $51,500. Its first officers were : James McLean, president, and Thomas Wilson, cashier. Alexander McLean, brother of James, was one of the leading projectors of the bank, and the McLean family is still identified with the institution, William S. McLean, Sr., the existing president, being a son of Alexander McLean. He has been president for almost forty years. The existing vice-presidents are William H. Conyngham and Charles F. Huber. Francis Douglas is cashier. At the end of 1926 the First National Bank had capital of $375,000, a surplus of $1,125,070, and deposits aggregating $7.370,580.

The Second National Bank of Wilkes-Barre, charter No. 104, was organ- ized on September 23, 1863, with a capital of $250,000. The original officers were : Thomas T. Atherton, president ; M. L. Everett, cashier. Its officers in 1926 were: H. B. Schooley, president; W. T. Payne, A. P. Kirby and E. B. Mulligan, vice-presidents ; and W. E. Lewis, vice-president and cashier. Its capital is $1,000,000, with surplus of $2,757.280, and deposits of more than $10,000,000.

The First National Bank of Pittston was organized in June, 1864, receiving National Charter No. 478. Theo. Strong was president for many years, and William L. Watson, once its cashier, was president fifteen years ago ;: The existing officers are : H. J. Mahon, president ; S. M. Parke, vice-president ; J. Benfield, cashier. At the end of 1926 its capital was $250,000, its surplus was $805,230, and its deposits amounted to $5,781,070. Identified with the bank for .. many years was the late Mr. C. S. Crane, a shrewd, conservative banker and " for some years virtually managing the bank, as cashier.

The First National Bank of Plymouth, the fourth of the five chartered in .. the 'sixties, was organized in September, 1865, its charter number being. 707;' and that of the Wyoming National Bank 732. The Plymouth institution, began, with a capital of $100,000. For its first few decades the bank had as its presi- dent the Hon. John B. Smith, son of Abijah Smith, who, in 1807, helped to .. open at Plymouth the first anthracite coal mine operated in the United States,; The first cashier of the bank was Henderson Gaylord. Edwin Davenport was .. president for many years, Henry Lees, the present incumbent, being his suo- .. cessor. A. K. De Witt, who is vice-president and cashier, has for the greater ... part of his lifetime held the latter office. At the end of 1926 the bank reported .. its deposits at $5,498,200. Its capital is $200,000 and surplus $830.050 ......

These National banks did their part in carrying the Nation's france's .. steadily during a critical period. The National currency in circulation af the end of the Civil War amounted to about $450,000,000. This flood of paper money

W .- B .- 4

would have constituted a most ominous financial state had the financial con- trol not been in the hands of a central authority. As it was, the Nation man- aged to exist and to rise above its financial difficulties during the next fifteen years, in which very little specie was in circulation.

The two savings banks organized in Luzerne County during the 'sixties were the Miners' Savings Banks of Wilkes-Barre and Pittston. They were organized under State law, the Wilkes-Barre institution being the first of its kind in the county. An act incorporating it was passed on February 13, 1868, the associa- tors being authorized to conduct a savings and loan institution, and indeed to do all other business that came within the power of a State bank. The savings bank was the forerunner of the trust company, having power also "to act as executor or administrator of any deceased testator or intestate." The Wilkes- Barre institution had a paid-in capital of $150,000, and its affairs were in the care of the following officers: A. C. Laning, president ; Ziba Bennett, Walter G. Sterling and A. T. McClintock, vice-presidents; J. A. Rippard, cashier. The institution was conservatively managed and steadily expanded its opera- tions. Latterly, it has been known as the Miners' Bank of Wilkes-Barre, and is now an immense banking institution, its deposits at the end of 1926 being $18,980,520. Its capital is two million dollars and its surplus in reserve is almost five millions. The present executives are: F. M. Kirby, chairman of board: C. W. Laycock. president: I. M. Thomas, J. N. Conyngham, Samuel McCracken and F. A. Gamble, vice-presidents ; W. J. Ruff, cashier.

The Miners' Savings Bank of Pittston was chartered under State law on November 1, 1869, and, with a capital of $60,000, began to do a banking busi- ness much like that of the Wilkes-Barre institution, having as wide powers. Mr. A. Bryden was president for many years, and the present chief executive, WV. L. Foster, was for many years cashier. Mr. W. J. Fowler is vice-president and Mr. Leo Reap is cashier. At the end of 1926 the condition of this strong institution was : Paid-in capital. $100,000; surplus, $1.595.530; deposits, $6,953.930.

One more of the existing banks of Luzerne County dates back to the 'sixties. In 1867 a private banking company began to do business in Hazle- ton, the leading coal operators of that district giving banking accommoda- tion to their employees under the banking name of Parlee, Markle and Grier. In 1872 they built a banking house. Eventually the company name was changed to Markle Brothers and Company. In June, 1892, as the volume of banking had grown considerably, corporate powers were taken, under the name Markle Banking and Trust Company, which is the present name. At the end of 1926 its capital was $600,000, its surplus $1,224,190, and its deposits totaled to $6,621,120. The officers then were: Alvan Markle, president ; Alvan Markle, Jr., and C. J. Kirschner, vice-presidents.

In the early 'seventies three of the existing banks of the county were founded. Some others were established, but could not stand the stress of the financial storm that raged in 1873 and left debris that could not be cleared for many years. Perhaps this explains the blank space on Luzerne County's list of banking promotions from 1872 to 1888. The People's Union Savings Bank .of Pittston and the Wilkes-Barre Deposit and Savings Bank were organized in 1871, and the Whitehaven Savings Bank in 1872, but the next that calls for notice is the Hazleton First National Bank, founded in 1888. In one or two . instances, banks organized during this period, and conducted successfully - through the critical period, have since been merged with other banks, and so ·have lost their identity in this record, which is of current institutions.

The People's Union Savings Bank of Pittston, organized in 1871 under State law, was operated on a capital of $75,000 for many years. Its capital at end of 1926 was $250,000; its surplus then was $504.530; and its deposits totaled-to $3.129.210. W. J. Kilgallon is president. The vice-president, A. C.

7 -77

EL CE EE

EE EE

THE MINERS BANK BUILDING, WILKES-BARRE, PENNSYLVANIA

Shoemaker, and cashier, W. H. McMillan, have held these offices for very many years.

The movement to establish a bank in Whitehaven was active in 1871, and on January 2, 1872, an act was passed authorizing the associators to begin banking business, under State law, with a capital of $25,000, with authority to increase to $50,000. Mr. Abram F. Peters was identified with the Whitehaven Savings Bank during its early decades as its president. R. P. Crellin, who is now president, was a director of the bank more than thirty years ago. H. P. Baker is vice-president, and F. F. Baetz cashier. At the end of 1926 its capital was still $25.000, but its surplus was $135,600. The deposits then were $813.440.

The Wilkes-Barre Deposit and Savings Bank was incorporated, under State law, on May 20, 1871, with an authorized capital of $300,000. Before the bank opened for business on July 1, 1871, $150,000 of this capital was paid in by the stockholders, who, in the main, constituted the directorate. The first directors were C. L. Lamberton, Stanley Woodward, C. Brahl, J. McNeish, Jr., W. W. Ketcham, A. J. Pringle, F. J. Helfrich, Joseph Lippincott and J. P. Williamson. The two last named were elected president and cashier, respec- tively. In its fifty-five years of careful operation the bank has become an institution of $300,000 paid-in capital, $740,570 surplus and more than $5,000,- 000 of deposits. The officers in 1926 were: J. R. Davis, president ; J. J. Becker, vice-president ; B. F. Williams, secretary.

The First National Bank of Hazleton was founded in June, 1888, charter No. 3893, with capital of $100,000, and the following officers: A. W. Leisen- ring, president ; David Clark, vice-president; John R. Leisenring, cashier. John B. Price, who was assistant cashier in the first years, is now president, an office he has held for almost a generation. The Heidenreich family, also, has been closely identified with the bank since its beginning; H. W. Heidenreich, vice-president, and P. G. Heidenreich, cashier, have acted as such for many years. At the end of 1926 the bank's paid-in capital was $500,000; its surplus was $806,280; and its deposits were $5,638,720.

The First National Bank of Nanticoke was founded in November, 1888, charter No. 3955. Its doors were opened for business on January 14, 1889. Its original capital was $75,000. After three years of operation it had accumu- lated a surplus of $13,000 and deposits of $167,189. At the end of 1926 its capital was $150,000, its surplus was $1,250,000, and its deposits stood at $7.000,000. This tells its own story. The officers in the first years were : John Smoulter, Jr., president; H. W. Search, vice-president; H. D. Flana- gan, cashier. Both Mr. Smoulter and Mr. Flanagan were in those respective offices for the first quarter century of the bank's existence. The officers in 1926 were : C. A. Shea, president ; J. H. Lecher, and F. H. Kohlnroker, vice- presidents, and William T. Harris, cashier.

During the 'nineties four of the existing banks began their careers. The Citizens Bank of Freeland was incorporated on January 30, 1890, under State laws. Its capital was $50,000, and its original officers were: Joseph Birk- beck. president ; H. C. Koons, vice-president ; B. R. Davis, cashier. Mr. Koons succeeded to the presidency and William Birkbeck became vice-president. The latter is now president, with C. O. Boyle as vice-president and W. E. Kahler as cashier. At the end of 1926 the paid-in capital was $200,000, the surplus was $447,680, and the deposits were $2,688,310.

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A history of Wilkes-Barre, Luzerne County, Pennsylvania : from its first beginnings to the present time, including chapters of newly-discovered early Wyoming Valley history, together with many biographical sketches and much genealogical material. Volume V, Part 8

Author: Harvey, Oscar Jewell, 1851-1922; Smith, Ernest Gray Publication date: 1909 Publisher: Wilkes-Barre : Raeder Press Number of Pages: 734

Author: Harvey, Oscar Jewell, 1851-1922; Smith, Ernest Gray
Publication date: 1909
Publisher: Wilkes-Barre : Raeder Press
Number of Pages: 734