November 15, 1908 - Ready to Alter an Old Bank Building
Title changed to Newark Banking Company on February 18, 1859. Title changed to National Banking Association on June 24, 1865.
From: "Newark, the City of Industry" Published by the Newark Board of Trade 1912
No history of the industrial growth and prosperity of Newark could be complete without an exhaustive review of the origin, uninterrupted progress and unexcelled record of the National Newark Banking Company, the first institution of its kind chartered under the laws of the State of New Jersey. So closely linked are the affairs of this venerable institution with those of the financial, commercial and industrial progress of its home city that it can truthfully be designated as the very keystone of the hustling, bustling, thriving and daily growing manufacturing center which has achieved a national, and even international reputation for the quality and quantity of the manifold products fashioned here.
The fact that the National Newark Banking Company has never failed to pay a dividend, some unprecedently large, from the time its charter was granted on February 8, 1804, until the present time, alone entitles it to a distinctive place in banking history. The customary dividend paid by the bank on its stock was 6%, although this rate gradually increased until it reached its present handsome rate of 24%. As long ago as 1813 the directors treated the stockholders to an agreeable surprise by declaring, in addition to the regular dividend, which at that time was 9%, an extra dividend of 4%. While heavy inroads were made on the bank's resources following the 1813-1814 war with England it never failed to return to its shareholders its regular dividend. The second extra dividend of 4½% and amounting to $17,903.25, was paid in 1835, when times were once more prosperous.
It requires a wide stretch of the imagination to connect the Newark Banking and Insurance Company charted 180 years ago with a capital of $225,000, with the National Newark Banking Company, whose assets today exceed 12 Million Dollars!
Occupying the most palatial quarters of any banking institution in the State, the magnificent white marble pile at Broad and Clinton Streets is quite in keeping with the dignified, venerable and substantial institution it houses.
It has been said that the present officers of the National Newark Banking Company form as happy an official family as is to be found in any financial institution in the country. Since the men at the helm of the bank's affairs are men who have been reared in the banking business, devoting their whole lives to finance, it is little wonder that such congeniality as here found should exist. Each officer has risen through the ranks. Each has filled every desk in this or some similar institution, and each is an expert in the field of his chosen endeavor.
When the Newark Banking and Insurance Company was chartered there were by 45 banks in the United States. There was little or no precedent by which the founders of this institution might be guided, save their own sound business judgment and insight into the affairs of the community in which each played a more or less important role.
The Revolutionary War had left the finances of this country in such a pitiably chaotic state that an appeal for help was made by the Federal Government to the States. Newark had no bank of its own, being entirely dependent upon New York and connected with that metropolis by a rough road over which an antiquated 2 horse stage coach made one round trip daily. Then it was that the businessmen of this city of five thousand souls bestirred themselves and procured a charter for a bank of their own. The provisions contained in this charter were manifold - some, to say the least, peculiar. For instance, the preamble showed that its ostensible purpose was to establish an insurance business, banking powers being added, lest the profits of the insurance business should prove inadequate to remunerate the shareholders, the advantages of a well organized bank being only in part recognized. A commission composed of John N. Cumming, Silas Condit, David D. Crane, Luther Goble and William Halsey was named to receive subscriptions for stock to the sum of $225,000. The State had reserved to the Governor the right to subscribe for $25,000 of this stock, a right he exercised when , by authority of law subsequently enacted, he sold this option to others eager for a parcel on the stock of the newly incorporated bank. The commissioners and stockholders met on May 14, 1804 to chose directors. Three months later, or on July 30, the bank threw open its doors for business in the parlor of the Smith Burnett Residence on Broad Street near Market Street, which suite the directors had secured by lease until the following May for the sum of $50.00.
Meanwhile property at the corner of Broad and Bank Streets had been purchased by the bank and a more suitable bank building contracted for. This structure was ready for occupancy at the expiration of the parlor lease. The newly erected building continued to be the home of the bank until 1856, when it was replaced by a handsome brownstone structure which, in turn, was razed to make room for one of the big skyscrapers there erected by the Prudential Insurance Company. Then it was that the National Newark Banking Company moved across the street to its present palatial quarters.
The most startling and dramatic event in the history of the Newark Bank occurred on May 14, 1848, when bank president Taylor, returning form New York, left a package containing $50,000 in checks and redeemed circulation notes in the seat he had occupied on the ferry boat. The appropriation of the package was traced to a woman who picked it up and concealed it beneath her apron as she left the boat. The detection was brought about by the woman's lavish expenditure of money, although when apprehended only $21,200 in note and $1,117.55 in checks were recovered. President Taylor keenly felt the loss which he attributed to his own carelessness, and the amount of the shortage he personally made good to the bank. Upon the dawn of the second half century in the bank's career Mr. Taylor resigned the presidency, James B. Pinneo being elected in his stead.
A renewal of the bank's charter, expiring in 1859, having been granted by the Legislature in 1855, one of its provisions permitted a change of title to the Newark Banking Company, effective in 1859. Meanwhile another change in the management of the bank occurred in February, 1858 when Mr. Vermilye relinquished the cashiership to accept a like berth with the Merchant's Bank on New York. It was in September of this year that the officials moved into the bank's newly erected brownstone structure that had been erected at Broad and Bank Streets, the bank being housed in temporary quarters, nearby, while the work was in progress.
Five months before the opening gun was fired upon Fort Sumter a panic ensued in financial circles, due to the fear of secession. The Government issued treasury notes, the proceeds of which were to be devoted to equipping its army. The Newark Bank in January, 1861, bought $25,000 of these notes, purchasing $130,000 more in the succeeding three months. The Government saw the necessity of raising additional funds in order to supply the sinews of war, and when bonds were issued for this purpose the Newark Banking Company was among the first to subscribe, taking over $50,000 of this paper at par. Some of the bank's customers had lost heavily at the outbreak of the war, due to the large accounts they were carrying with their southern trade. But in the majority of instances the Newark Banking Company took care of their paper, even going so far as to advance additional funds with which to make over their manufactories in order to produce their share of the many wares the Government required in the equipment of all arms on it service. Thus many a Newark manufacturer who saw ruination staring him in the face at the outset of the war, through the leniency and generosity of the Newark Banking Company, started afresh and built up a fortune far in excess of his most sanguine expectation.
Bravely surmounting all obstacles that arose in its path during the parlous days of the Civil War, the Newark Banking Company not only breasted the wave of financial depression that swept the country, but made money for its stockholders and furnished the capital for numbers of patrons who grew rich as purveyors to the Government during the war. On November 17, 1864, the question of organizing the NEwark Banking Company as a national banking association was agitated. This became a reality, and the transition became effective on May 4, 1865. The name of the reorganized institution then became the National Newark Banking Company, with its capital fixed at $500,000.
The war over, the National Newark Banking Company continued to thrive and expand. A period of prosperity became so manifest about this time that a gratuity of 15% and still another of 25% was added to the salaries of all the institution's employees. But in 1870 the tide turned and another long period of depression ensued which made it necessary to reduce salaries and retrench wherever possible. More than one big concern doing business in Newark went to the wall at this time, but, wherever possible, a helping hand was extended to its patrons. Despite this curtailment in expenses the bank paid its dividend. On March 27, 1879, the surplus find account was reduced $30,000 for losses beyond the amount of the undivided profits account. The resumption of specie payment was accomplished in this year after a suspension of seventeen years.
The most important and vital step in the bank's history came up for discussion in January, 1902, when the question of consolidation with the Newark City National Bank was seriously entered into. A meeting of the stockholders of the National Newark Banking Company was held on May 10, when ratification of the amalgamation was obtained, together with the election of 12 directors of the Newark City National Bank to the directorate of the consolidated institution.
At the present time the National Newark Banking Company is installing new safe deposit vaults which, when completed, will be the finest and strongest in the State. They are constructed of Harveyized nickel steel armor plate and are so built as to withstand conflagration or earthquake as well as being mob and burglar proof. They are being constructed by the Bethlehem Steel Company of South Bethlehem, PA under the supervision of the Hollar Company, the noted vault engineers of Philadelphia, and the material is the same as that used on the battleships of the United States Navy. These vaults when completed will be the largest and best equipped of any in the State, and the National Newark Banking Company will again show its determination to give to the City of Newark the very best in its line.
From: National Newark & Essex Banking Company - 1929, 125th Anniversary
In 1918 consolidation with the fine old Essex County National Bank marked a further strengthening of personnel and a big increase in assets and deposits. Which this last amalgamation, the name was changed to National Newark & Essex Banking Company.
The purely commercial bank of a century and a quarter ago, has become a great, many-sided, modern financial institution, rendering every banking service to its individual depositors, to manufacturers, to merchants, to other banks, to estates, and to religious, charitable and other organizations. In City, County,State and National financing, it plays the part of the oldest and largest National Bank in New Jersey.
The bank handles commercial and personal checking accounts, Savings Deposits, and Trust Funds. It renders expert investment service. For its many friends who are Americans by adoption as well as for business houses doing business abroad, the bank operates an efficient and experienced Foreign Department. Impregnable Safe Deposit Vaults and every other approved modern banking equipment and convenience are at the command of the great metropolitan community whose growth and prosperity have been interwoven with the growth of the bank during 125 years.
It is to house this vast business, to provide adequate space for the convenience and comfort of its thousands of patrons, that the bank has planned its new home. The building will beautiful as well as adequate. Its 32 stories will rise above any building now standing. In addition to the banking rooms, large store and office space will be provided. The rentals from these stores and offices in their highly desirable location will make the building a profitable investment.
The architects have so planned the construction that there will be absolutely no interruption of the bank's business and its patrons will not be inconvenienced.
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