First three buildings of the American bank
By John Steele Gordon
BBefore there could be bank buildings, there had to be banks, and the United States did not have any when it declared independence. Britain had banned the American colonies from operating banks, not the least of the restrictions the motherland had placed on the burgeoning American economy.
But then, in 1781, the Continental Congress chartered a bank with the unwieldy name of The President, Directors, and Company of the Bank of North America. (In 1825, the bank changed its name to what everyone called it anyway, the Bank of North America, or BNA for short.)
It opened in Philadelphia on January 7, 1782. It was located in a store owned by its chief cashier, Tench Francis, on Chestnut Street, which had been redeveloped to serve as a bank. The converted store would be the headquarters of the bank for the next 64 years.
Regardless of its unappealing architecture, the bank quickly operated with great success, paying dividends of 14% of the face value of the share. Its biggest client was the Continental Congress, which quickly borrowed $ 400,000, a sizeable sum by the standards of the time. It is a sign of the primitivity of the American financial system in the early 1780s that these dollars were Mexican dollars, often referred to as pieces of eight, as they were sometimes cut into eight pieces to make small change.
The Continental Congress had issued paper money called “continental” to finance the War of Independence, but they quickly depreciated and it was not until 1785 that the United States adopted the dollar, based on the Spanish dollar, as currency. American coins were not minted until 1792.
The Bank of North America, through a series of mergers that have been so part of the American banking industry over the past hundred years, is now part of Wells Fargo.
The second bank to open in the nascent United States was the Massachusetts Bank in Boston in 1784. Like the Bank of North America, it was licensed by the Continental Congress. Its first seat was at the Manufacture House near the Boston Common.
The Manufacture was built in 1753 by the Society for Encouraging Industry and Commerce and the Employing of the Poor. He hoped to use young women to spin linen thread, but the business soon failed and the building was rented. In 1768, the governor ordered the tenants to vacate the building, an important building, so that it could house a regiment of British soldiers. The tenants refused and a brief confrontation ensued before the soldiers moved elsewhere. This is often considered the first conflict between American civilians and British soldiers during the American Revolution. The building was demolished in 1806 and a nearby plaque commemorates it. Today, Massachusetts Bank is part of Bank of America.
The third bank, the Bank of New York, was founded in 1784 by Alexander Hamilton. Its first headquarters actually looked like purpose-built banks later, located in the Walton House on Pearl Street. The mansion, built by William Walton, one of the wealthiest of New York’s “Knickerbocker aristocracy”, had a fifty foot wide frontage. It was made of imported Dutch bricks with beautiful architectural details in brown stone.
James Roosevelt, one of the founders and early executives of the Bank (and Franklin Roosevelt’s great-grandfather), was married to a niece of William Walton. A decade later, the Bank of New York built a new head office on the corner of Wall and William Streets, one of the very first purpose-built banks in the country. It will remain there for two centuries (in three successive buildings).