New York's Oldest Companies
Grass was literally growing in Wall Street when Bank of New York & Trust Co. was founded in 1784. The little city of 23.000 souls which sprawled across the lower tip of Manhattan Island was just beginning to recover from the scourge of British occupation. One-eighth of the town was a blasted waste of charred ruins. Orchards and fences had all been burned for fuel. Cows browsed in the weedy thoroughfares. Wharves were decaying. The city treasury was empty.
But Manhattan's bewigged merchants had bestirred themselves in the short half-year since War had officially ceased. On a bright February morning in 1784 the
Packet, one of the town's four newspapers, carried this announcement : "It appearing to be the disposition of the gentlemen of this city to establish a bank on liberal principles, the stock to consist of specie only, they are therefore invited to meet tomorrow evening, at six o'clock, at the Merchants' Coffee-House, where a plan will be submitted for their consideration." Up to that time there had been no bank in New York. Until three years before when Bank of North America (now part of The Pennsylvania Co. for Insurance of Lives & Granting Annuities) was found ed in Philadelphia there had been no bank in all the 13 colonies. Prime mover behind the new bank was a brilliant young bastard from the West Indies named Alexander Hamilton. Banks were new even in Europe but this 27-year-old veteran of the Revolution knew all the banking there was to know. It took a pocket full of depreciated paper money to buy a twist of to bacco or a cannikin of rum and people had long talked of a bank whose stock would be subscribed in land. But Hamilton's bank was to be a specie bank or no bank at all. The president, directors and company of the Bank of New York were organized with $500.000 capital. Among the directors were Nicholas Low, Comfort Sands and a doughty old sugar refiner named Isaac Roosevelt who later became the bank's president and whose first cousin four times removed was to become 25th President of the U. S. and whose great-great-grandson was to become 32nd President of the U. S. The directors picked for their first president, General Alexander Macdougall, a brisk, decisive Scotch merchant who earlier in his life had piled up a small fortune privateering. Without waiting to obtain a charter (which was not granted until seven years later), the bank soon opened for business, having duly "qualified before his Worship, the Mayor.''
Bank of New York had a monopoly on Manhattan banking until the branch of the Bank of the United States was established in 1791. Its first private competitor originated with a bright young man who had just begun to realize the possibilities of a new organization known as Tammany Society. With a fine show of public spirit, Aaron Burr promoted a water system for the city. In the charter for his Manhattan Co. he inserted a clause permitting it to engage in "moneyed transactions." A few of the people's representatives suspected a ruse but Burr talked vaguely of "trade with the Indies" and the charter was granted. Manhattan Co. promptly opened a banking business which it still carries on at 70 branches throughout New York. For the first 100 years of its existence Bank of New York remained the biggest institution in the city. Like other Manhattan banks it occasionally moved out to Greenwich Village in the country during periodic yellow fever plagues. It weathered panic after panic, including that of 1857 when Harper's Weekly wrote: "Not for many years — not in the lifetime of most men who read this paper — has there been so much grave and deep apprehension. ... Of our troubles no man can see the end." Last week this venerable institution celebrated its sesquicentennial. Each & every employe got half a month's salary as a bonus. A privately printed history of its first 150 years was written by no less a person than Allan Nevins, last year's Pulitzer Prize winner (Grover Cleveland}. Clients and depositors, many of them lineal descendants of original customers, sent armfuls of flowers. To become 17th president of Bank of New York John C. Traphagen went through the bank's usual ritual. A Chase National vice president, he was first nominated by the trustees for the requisite period of three weeks. After he was made a trustee, his fellow trustees solemnly elected him president in 1931. The stockholders have no voice in elections and the trustees are a self-perpetuating body. Today under boyish, affable President Traphagen Bank of New York with $151,-000.000 in resources is not a big bank as Manhattan banks go, but it commands enormous respect for its conservative sagacity. The only merger in its history was with New York Life Insurance & Trust Co. in 1922. Nearly a century old at the time of the merger, the insurance company was the first institution in the U. S. to use the word "trust" in its corporate title. Its insurance business was dropped but the bank's annual reports show a reserve for old annuities which grows smaller each year and will disappear when the last annuitant dies. Bank of New York is dominated by no family or group except the self-perpetuating board of 26 trustees. Its sole branch is a colonial mansion uptown in the swank residential section. There the tellers may receive their socialite customers behind desks instead of wickets.
But Manhattan's bewigged merchants had bestirred themselves in the short half-year since War had officially ceased. On a bright February morning in 1784 the
Packet, one of the town's four newspapers, carried this announcement : "It appearing to be the disposition of the gentlemen of this city to establish a bank on liberal principles, the stock to consist of specie only, they are therefore invited to meet tomorrow evening, at six o'clock, at the Merchants' Coffee-House, where a plan will be submitted for their consideration." Up to that time there had been no bank in New York. Until three years before when Bank of North America (now part of The Pennsylvania Co. for Insurance of Lives & Granting Annuities) was found ed in Philadelphia there had been no bank in all the 13 colonies. Prime mover behind the new bank was a brilliant young bastard from the West Indies named Alexander Hamilton. Banks were new even in Europe but this 27-year-old veteran of the Revolution knew all the banking there was to know. It took a pocket full of depreciated paper money to buy a twist of to bacco or a cannikin of rum and people had long talked of a bank whose stock would be subscribed in land. But Hamilton's bank was to be a specie bank or no bank at all. The president, directors and company of the Bank of New York were organized with $500.000 capital. Among the directors were Nicholas Low, Comfort Sands and a doughty old sugar refiner named Isaac Roosevelt who later became the bank's president and whose first cousin four times removed was to become 25th President of the U. S. and whose great-great-grandson was to become 32nd President of the U. S. The directors picked for their first president, General Alexander Macdougall, a brisk, decisive Scotch merchant who earlier in his life had piled up a small fortune privateering. Without waiting to obtain a charter (which was not granted until seven years later), the bank soon opened for business, having duly "qualified before his Worship, the Mayor.''
Bank of New York had a monopoly on Manhattan banking until the branch of the Bank of the United States was established in 1791. Its first private competitor originated with a bright young man who had just begun to realize the possibilities of a new organization known as Tammany Society. With a fine show of public spirit, Aaron Burr promoted a water system for the city. In the charter for his Manhattan Co. he inserted a clause permitting it to engage in "moneyed transactions." A few of the people's representatives suspected a ruse but Burr talked vaguely of "trade with the Indies" and the charter was granted. Manhattan Co. promptly opened a banking business which it still carries on at 70 branches throughout New York. For the first 100 years of its existence Bank of New York remained the biggest institution in the city. Like other Manhattan banks it occasionally moved out to Greenwich Village in the country during periodic yellow fever plagues. It weathered panic after panic, including that of 1857 when Harper's Weekly wrote: "Not for many years — not in the lifetime of most men who read this paper — has there been so much grave and deep apprehension. ... Of our troubles no man can see the end." Last week this venerable institution celebrated its sesquicentennial. Each & every employe got half a month's salary as a bonus. A privately printed history of its first 150 years was written by no less a person than Allan Nevins, last year's Pulitzer Prize winner (Grover Cleveland}. Clients and depositors, many of them lineal descendants of original customers, sent armfuls of flowers. To become 17th president of Bank of New York John C. Traphagen went through the bank's usual ritual. A Chase National vice president, he was first nominated by the trustees for the requisite period of three weeks. After he was made a trustee, his fellow trustees solemnly elected him president in 1931. The stockholders have no voice in elections and the trustees are a self-perpetuating body. Today under boyish, affable President Traphagen Bank of New York with $151,-000.000 in resources is not a big bank as Manhattan banks go, but it commands enormous respect for its conservative sagacity. The only merger in its history was with New York Life Insurance & Trust Co. in 1922. Nearly a century old at the time of the merger, the insurance company was the first institution in the U. S. to use the word "trust" in its corporate title. Its insurance business was dropped but the bank's annual reports show a reserve for old annuities which grows smaller each year and will disappear when the last annuitant dies. Bank of New York is dominated by no family or group except the self-perpetuating board of 26 trustees. Its sole branch is a colonial mansion uptown in the swank residential section. There the tellers may receive their socialite customers behind desks instead of wickets.
