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60-602: The plans established installment credit for customers. Lending required the borrower to provide references and proof of earnings to establish the borrower's credit worthiness. The banks gave depositors interest to secure funds for the loans. The banks were eventually organized as a New York-based banking organization (holding company) and made small loans to moderate income families through banks in more than 100 U.S. cities. In 1917, credit life insurance plans were offered. Morris Banks made 1,760,000 loans in its first 12 years, amounting to about $ 320 million. The banks were affected by

120-628: A bank teller . John S. Reed was selected CEO in 1984, and Citi became a founding member of the CHAPS clearing house in London. Under his leadership, the next 14 years would see Citibank become the largest bank in the U.S., the largest issuer of credit cards and charge cards in the world, and expand its global reach to over 90 countries. As the bank's expansion continued, the Narre Warren-Caroline Springs credit card company

180-412: A country that denied bank loans to a large part of its population had a “weak spot” in its banking system. Morris then began a study of the various banking laws in the U.S. in the hopes that some type of “banking institution could be evolved that would correct the existing evils and supply credit to the needy” (Herzog 1928, 12-13). Morris’ study resulted in his establishing a set of principles for lending to

240-574: A further $ 20 billion was invested in the company along with guarantees for risky assets of $ 306 billion. The guarantees were issued at a time markets were not confident Citi had enough liquidity to cover losses from those investments. Eventually, the Citi shares the Treasury took over in return for the guarantees it issued were booked as net profit for the treasury as Citi had enough liquidity and guarantees did not have to be used. By 2010, Citibank had repaid

300-400: A half manas of money belonging to Iddin-Marduk, son of Iqisha-apla, son of Nur-Sin, (is loaned) unto Ben-Hadad-natan, son of Addiya and Bunanit, his wife. Monthly the amount of a mana shall increase its sum by a shekel of money. From the first of the month Siman, of the fifth year of Nabonidus, King of Babylon, they shall pay the sum on the money. The call shall be made for the interest money at

360-435: A law library constructed in 1974 and named for him. Installment credit An installment loan is a type of agreement or contract involving a loan that is repaid over time with a set number of scheduled payments; normally at least two payments are made towards the loan. The term of loan may be as little as a few months and as long as 30 years. A mortgage loan , for example, is a type of installment loan. The term

420-459: A merger with Foreman National. When Foreman National was acquired by First National Bank in 1931, Head resigned to become president of Morris Plan Corp. At the time, Morris Plan was the largest industrial banking system in the U.S., with $ 200 million in annual business and 800,000 customers. Morris graduated from the University of Virginia and made donations at the end of his life to help fund

480-842: A position he held until 1933. Under Mitchell, the bank expanded rapidly and by 1930 had 100 branches in 23 countries outside the United States. The policies pursued by the bank under Mitchell's leadership are seen by many people as one of the prime causes of the stock market crash of 1929, which led ultimately to the Great Depression . In 1933, the Pecora Commission , a United States Senate committee, investigated Mitchell for his part in tens of millions of dollars in losses, excessive pay, and tax avoidance, later leading to his resignation. U.S. Senator Carter Glass said of him, "Mitchell, more than any 50 men,

540-534: A quarterly basis. The rate of 6% with 3% interest allowed on as signed deposits was adopted in May 1928, by the National City Bank of New York — The Morris Plan Bank of Virginia being then the only institution in the United States making loans on such an economical basis for the small borrower. Russell Sage Foundation viewed the lending procedure to be misleading at best, and at worst, an attempt to defraud

600-469: Is home to the majority of Citibank's US branches, with 292 branches located in the state.' Citi announced it may return its retail banking presence to Dallas in 2022. Citibank will take more than 9,000 square feet of space in the Berkshire Court building at Preston and Northwest Highway. Construction is scheduled to start on the new office early next year, according to planning documents filed with

660-588: Is most strongly associated with traditional consumer loans, originated and serviced locally, and repaid over time by regular payments of principal and interest. These “installment loans” are generally considered to be safe and affordable alternatives to payday and title loans , and to open ended credit such as credit cards . In 2007 the US Department of Defense exempted installment loans from legislation designed to prohibit predatory lending to service personnel and their families, acknowledging in its report

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720-463: Is no current maximum interest rate or usury restriction under South Dakota law when a written agreement is formed. In 2005, Federated Department Stores, now Macy's, Inc. , sold its consumer credit portfolio to Citigroup, which reissued its cards under the name Department Stores National Bank (DSNB). As of 2013, Citibank employed 2,900 people in Sioux Falls , South Dakota, and contributed to

780-579: Is responsible for this stock crash ." On December 24, 1927, its headquarters in Buenos Aires , Argentina, were blown up by the Italian anarchist Severino Di Giovanni , in the frame of the international campaign supporting Sacco and Vanzetti . In 1940 and 1941, branches in Germany and Japan closed. In 1945, the bank handled $ 5.6 billion in Treasury securities for War and Victory Loan drives for

840-564: Is the fourth-largest bank in the United States in terms of assets. The City Bank of New York was founded on June 16, 1812. The first president of the City Bank was the statesman and retired Colonel, Samuel Osgood . After Osgood's death in August 1813, William Few became President of the bank, staying until 1817, followed by Peter Stagg (1817–1825), Thomas Smith (1825–1827), Isaac Wright (1827–1832), and Thomas Bloodgood (1832–1843). After

900-443: Is the primary U.S. banking subsidiary of Citigroup , a financial services multinational corporation. Citibank was founded in 1812 as City Bank of New York , and later became First National City Bank of New York . The bank has branches in 19 countries. The U.S. branches are concentrated in six metropolitan areas, New York City , Chicago , Los Angeles , San Francisco , Washington, D.C. , and Miami . As of 2023, Citibank

960-647: The American Civil War with $ 50 million in war bonds, opening the first foreign exchange department of any bank (1897), and receiving a $ 5 million deposit to be given to Spain for the US acquisition of the Philippines (1899). In 1865, the bank joined the national banking system of the United States under the National Bank Act and became The National City Bank of New York. By 1868, it was one of

1020-670: The Banque Nationale de la République d'Haïti , which was the sole commercial bank of Haiti and served as the Haitian government's treasury. Citibank then lobbied for the United States occupation of Haiti , which began in 1915. During the occupation, Citibank imposed a US$ 30 million loan on the Haitian government, which was described by communist George Padmore as transforming Haiti into an "American slave colony". Citibank would go on to acquire some of its largest gains in

1080-544: The Great Depression and changes to the banking industry in its aftermath. In 1910, attorney Arthur J. Morris (1881–1973) opened the Fidelity Savings and Trust Company in Norfolk, Virginia , which made small loans to working people under a concept he called "Morris Plan". Under this lending approach, would-be borrowers had to submit references from two people of like character and earnings power who would guarantee

1140-639: The International Banking Corporation (IBC), a company chartered to conduct banking business outside the U.S., which was forbidden to U.S. national banks. In 1918, IBC became a wholly owned subsidiary and was subsequently merged into the bank. The same year, the bank evacuated all of its employees from Moscow and Petrograd as the Russian Civil War had begun, but also established a branch in Puerto Rico . By 1919,

1200-459: The Panic of 1837 , Moses Taylor acquired control of the company. During Taylor's ascendancy, the bank functioned largely as a treasury and finance center for Taylor's own extensive business empire. Later presidents of the bank included Gorham A. Worth (1843–1856), Moses Taylor himself (1856–1882), Taylor's son-in-law Percy Rivington Pyne I , and James Stillman (1891–1909). In 1831, City Bank

1260-445: The "Everything Card"—in 1967. In 1967, Walter B. Wriston became chairman and chief executive officer of the bank. In the 1960s, the bank entered into the credit card business. In 1965, First National City Bank bought Carte Blanche from Hilton Hotels . Three years later, under pressure from the U.S. government, the bank sold this division. By 1968, the company created its own credit card. The card, known as " The Everything Card ",

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1320-593: The 1920s due to debt payments from Haiti, according to later filings to the Senate Finance Committee . When the Federal Reserve Act allowed it, National City Bank became the first U.S. national bank to open an overseas banking office when it opened a branch in Buenos Aires , Argentina, in 1914. Many of Citi's present international offices are older; offices in London, Shanghai, Calcutta , and elsewhere were opened in 1901 and 1902 by

1380-448: The 1970s, Citibank was one of the first U.S. banks to introduce automatic teller machines (ATMs), which gave customers 24-hour access to cash. In 2002, Citigroup, the parent of Citibank, acquired Golden State Bancorp and its California Federal Bank , which was one-third owned by Ronald O. Perelman , for $ 5.8 billion. In 1999, Citibank was sued for improperly charging late fees on its credit cards. In August 2004, Citigroup entered

1440-556: The Chicago banking factions accused U.S. Secretary of the Treasury L. M. Shaw of having too close of a relationship with National City and other Wall Street operators. In 1907, Stillman, then the bank's chairman, intervened, along with J. P. Morgan and George Fisher Baker , in the Panic of 1907 . Between 1910 and 1911, the Department of State backed a consortium of American investors headed by Citibank to acquire control over

1500-551: The Texas market with the purchase of First American Bank of Bryan, Texas . The deal established the firm's retail banking presence in Texas, giving Citibank over 100 branches, $ 3.5 billion in assets and approximately 120,000 customers in the state. In 2006, the bank entered the Philadelphia market, opening 23 branches in the metropolitan area. In 2013, Citibank closed these locations for "efficiency-driven" reasons. In 2006,

1560-590: The U. S. In the last 21 years these banks loaned $ 1,750,000,000 to 7,000,000 people, and now do about $ 200,000,000 annual business with 800,000 customers.” Morris Plan banks pioneered the use of automotive financing through arrangements between the Morris Plan Company of America, the holding company for Morris Plan banks, and the Studebaker Corporation . In 1917 through the subsidiary Morris Plan Insurance Society, credit life insurance

1620-539: The U.S. government. In 1952, James Stillman Rockefeller was elected president and then chairman in 1959, serving until 1967. Stillman was a direct descendant of the Rockefeller family through the William Rockefeller (the brother of John D. ) branch. In 1960, his second cousin, David Rockefeller , became president of Chase Manhattan Bank , National City's long-time New York rival for dominance in

1680-424: The bank as additional collateral to his loan for the protection of his co-makers as well as the bank. That, then, was "The Morris Plan". Morris Plan banks can be traced to the concerns of Arthur J. Morris. Mr. Morris, a Virginia lawyer, found it troubling that a securely employed workman, seeking a small loan, was denied access to credit from local banks and was forced to borrow from loan sharks . Morris thought that

1740-593: The bank had become the first U.S. bank to have $ 1 billion in assets. As of March 9, 1921, there were four national banks in New York City operating branch offices: Chatham and Phenix National , the Mechanics and Metals National , the Irving National , and National City Bank. Charles E. Mitchell , also called "Sunshine" Charlie Mitchell, was elected president in 1921. In 1929, he was made chairman,

1800-615: The bank had been nicknamed "Citibank" since the 1860s, when City Bank of New York adopted it as an eight-letter wire code address. "Citicorp" became the holding company's formal name in 1974, and in 1976, First National City Bank was renamed Citibank, N.A. The name change also helped to avoid confusion in Ohio with Cleveland -based National City Corp. , though the banks never had any significant overlapping areas except for Citi credit cards issued in National City territory. In addition, at

1860-622: The bank set aside $ 3 billion in reserves for loan losses in Brazil and other developing countries . In 1990, the bank established a subsidiary in Poland. In 1994, it became the world's biggest card issuer. Also in the 1980s, the bank launched the Citicard, which allowed customers to perform all transactions without a passbook . Branches also had terminals with simple one-line displays that allowed customers to get basic account information without

Morris Plan Banks - Misplaced Pages Continue

1920-571: The banking industry in the United States. Following its merger with the First National Bank in 1955, the bank changed its name to The First National City Bank of New York, then shortened it to First National City Bank in 1962. It is also worth noting that the bank began recruiting at Harvard Business School in 1957, arranged the financing of the 1958 Hollywood film, South Pacific , and had its branches in Cuba nationalized in 1959 by

1980-550: The bank’s regulations, to run for twelve months, endorsed by two friends, relatives, or fellow-workers. At the same time the borrower agreed to open a savings account at the end of a week or two weeks or a month, as determined at the time of the loan. He agreed to deposit in the account at regular intervals 1/50 or 1/24 or 1/12 of the amount of his loan, so that at the end of twelve months there would be on deposit an amount, exactly equal to his note. He agreed in writing not to withdraw any funds from this savings account, but assigned it to

2040-436: The borrower's creditworthiness, and agreed to repay the loan through the purchase of Installment Thrift Certificates in weekly installments that would repay the face value of the loan. Morris Plan Banks expanded to more than 100 locations in the United States. At the time Morris Plan banks first appeared in 1910, few institutions existed for provision of consumer credit to low-and middle-income individuals. Morris Plans pioneered

2100-628: The borrowers. Hence, many viewed the profit-seeking Morris Plan institutions as little better, and in some respects worse, than loan sharks . H. Ross Ake was secretary-treasurer and manager of the Canton, Ohio , Morris Plan Bank from its founding in 1916. He also was on the Board of Governors of the National Association of Morris Plan Bankers. In 1929, Walter W. Head took over as president of State Bank of Chicago and guided it through

2160-422: The company announced a naming rights sponsorship deal for the new stadium of New York Mets , Citi Field , which opened in 2009. The deal reportedly required payments by Citi of $ 20 million per year for 20 years. As of September 2020, Citibank's US branches are located in the metropolitan areas of New York, Los Angeles, San Francisco, Sacramento, San Diego, Washington DC, Las Vegas, Miami, and Chicago. California

2220-485: The company's German division, was sold to Crédit Mutuel . On February 22, 2010, it was renamed to Targobank . In August 2008, after a three-year investigation by the California Attorney General , Citibank was ordered to repay the $ 14 million that was removed from 53,000 customers accounts over an 11-year period from 1992 to 2003, plus an additional $ 4 million in interest and penalties. The money

2280-463: The concept of paying the interest in installments at regular intervals. The payment of the interest on loans in installments can be discerned as early as the 6th century B.C. within such ancient contracts as the following contract for a loan of money, which is from ~ 550 B.C., wherein no security was given the creditor, but he received an interest of 20% and that interest was made payable in installments at intervals of one (assumedly lunar) month: "One and

2340-458: The fourth quarter of 2007, after an $ 18.1 billion write down. In March 2008, Citibank set up Mobile Money Ventures, a joint venture with SK Telecom , to develop mobile apps for banking. It sold the venture to Intuit in June 2011. In May 2008, the company closed an $ 87.5 million leaseback transaction for branches in New York City. In July 2008, Citibank Privatkunden AG & Co. KGaA ,

2400-543: The house which belongs to Iba. Monthly shall the sum be paid. " (From the Fordham University Internet Ancient History Sourcebook, Editor: Paul Halsall, "A Collection of Contracts from Mesopotamia, c. 2300 - 428 BCE"). A type of installment contract other than a loan involves the purchase of durable goods on credit. Such arrangements are usually referred to as "installment plans" rather than "installment loans". In 1807,

2460-422: The installment selling of durable goods was introduced in the US by the furniture store Cowperthwaite & Sons. It opened in New York City and soon began extending credit for purchases of furniture items with payment by installments. Within a few years, such installment plans were being used by merchants engaged in selling furniture in other cities. Well known installment plans used by Singer company for financing

Morris Plan Banks - Misplaced Pages Continue

2520-478: The largest banks in the United States. The bank became the largest bank in New York City following the Panic of 1893 . Two years later, in 1895, it had become the largest bank in the U.S. In 1904, the bank helped finance the Panama Canal . Two years later, in 1906, 11% of the U.S. federal government 's bank balances were held by National City. National City at this time was the banker of Standard Oil , and

2580-455: The loans from the Treasury in full, including interest, resulting in a net profit for the U.S. federal government. On January 16, 2009, Citigroup announced that it was separating Citi Holdings Inc. , its non-core businesses such as brokerage, asset management, and local consumer finance and higher-risk assets, from Citicorp. The split was presented as allowing Citibank to concentrate on its core banking business. On October 19, 2011, Citigroup,

2640-473: The nascent credit union movement. By 1931, there were 109 Morris Plan banks operating in over 100 cities with an annual loan volume about $ 220,000,000. “Walter W. Head, past president of American Bankers Assn., was elected president of Morris Plan Corp. of America, succeeding Austin L. Babcock. Morris Plan Corp. has large stock holdings in all the Morris Plan banks, the largest industrial banking system in

2700-401: The need to protect access to beneficial installment credit while closing down less safe forms of credit. Lending has been practiced for many thousands of years and has manifested a variety of forms throughout that time. Primitive loan contracts from Mesopotamia as early as the 10th century B.C. evidence the development of a rudimentary system of credit which included the concept of interest, and

2760-464: The new socialist government, and has its first African-American director in 1969, Franklin A. Thomas . The company organically entered the leasing and credit card sectors, and its introduction of US dollar-denominated certificates of deposit in London marked the first new negotiable instrument in the market since 1888. Later to become part of MasterCard , the bank introduced its First National City Charge Service credit card—popularly known as

2820-506: The parent of Citibank, agreed to a $ 285 million civil fraud penalty after the U.S. Securities and Exchange Commission accused the company of betting against risky mortgage-related investments that it sold to its clients. In 2014, Citigroup announced it would exit retail banking in 11 markets, primarily in Europe and Central America. In September 2014, it exited the Texas market with the sale of 41 branches to BB&T . In September 2015,

2880-723: The parent of Citibank, announced layoffs of 17,000 employees, or 8% of its workforce. On November 4, 2007, Charles Prince resigned as the chairman and chief executive of Citigroup, the parent of Citibank, following crisis meetings with the board in New York in the wake of billions of dollars in losses related to subprime lending . Former United States Secretary of the Treasury Robert Rubin took over as chairman, subsequently hiring Vikram Pandit as chief executive. On November 5, 2007, several days after Merrill Lynch announced that it too had been losing billions from

2940-444: The poor. Those principles were: 1. Character, plus earning power, is a proper basis of credit. 2. Loans made on this basis of credit must carry the privilege of repayment over a period long enough to match the earning power of the borrower. 3. Borrowed money should always be for some constructive and useful purpose. It was decided that 3% would be allowed on savings deposits required against loans, this interest to be computed on

3000-924: The purchase of their sewing machines began in 1850. After Singer, other companies started using installment loans. In 1899 in Boston, more than a half of furniture dealers used such loans. Around 1890, installment loans were used to finance sewing machines, radios, refrigerators, phonographs, washing machines, vacuum cleaners, jewelry and clothing. By 1924, 75% of automobiles were purchased with installment loans. Tribal installment loans are another version of installment loans. Unlike other forms of installment loans, which are offered by non bank lenders and overseen by state and federal regulators, tribal installment loans are offered by tribal lending entities and regulated by independent tribal regulatory authorities. National City Bank of New York Citibank, N.A. ("N. A." stands for " National Association "; stylized as citi bank)

3060-509: The state holding more bank assets than any other state. In 2013, Citibank purchased the credit card portfolio of Best Buy from Capital One. On April 1, 2016, Citigroup became the exclusive issuer of Costco 's branded credit cards. The bank's private-label credit card division, Citi Retail Services, issues store-issued credit cards for such companies as: American Airlines , Best Buy , ConocoPhillips , Costco , ExxonMobil , The Home Depot , Sears , Shell Oil , and Staples Inc. In

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3120-578: The state. The new Citibank office is described as an "experience center" in the planning documents. The plans identify the operation as "retail bank/office space". Citibank doesn't have a major retail banking presence in the Dallas area. A spokesman in the bank's New York office would not give details about what is planned in the North Dallas location. "We'll decline to comment on this," said Citibank's Drew Benson in an email. On April 11, 2007, Citigroup,

3180-413: The subprime mortgage crisis in the United States, Citi reported that it will lose between $ 8 billion and $ 11 billion in the fourth quarter of 2007, in addition to the $ 6.5 billion it lost in the third quarter of 2007. Effective November 30, 2007, Citibank sold its 17 Puerto Rico branches, along with $ 1.0 billion in deposits, to Banco Popular . In January 2008, Citigroup reported a $ 10 billion loss in

3240-409: The time of the name change to Citicorp, in 1968, National City of Ohio was mostly a Cleveland-area bank and had not gone on its acquisition spree that would occur in the 1990s and 2000s. Any possible name confusion had Citi not changed its name from National City eventually became completely moot when PNC Financial Services acquired National City in 2008 during the subprime mortgage crisis . In 1987,

3300-471: The use of automotive financing (through arrangements between the Morris Plan Company of America, essentially a holding company for Morris Plan banks, and the Studebaker Corporation ). The associated Morris Plan Insurance Society similarly pioneered credit life insurance (as it allowed for the loan to be repaid if the borrower died during the term of the loan, with any residue going to the estate). Morris Plan banks expanded relying on state charters just as did

3360-665: Was offered to pay off any outstanding loan balance if the borrower died. Any insurance left over went to the borrower’s estate. Opened in July 17 of 1922, the Morris Plan Bank of Virginia made loans based on “Character as the Prime Collateral.” Solicitors soon obtained over 2,000 savings accounts, and the volume of loans to individuals began to develop. The great majority of loans were made to persons seeking to borrow $ 100 to $ 300, who offered their notes, in keeping with

3420-675: Was promoted as a kind of East Coast version of the BankAmericard . By 1969, First National City Bank decided that the Everything Card was too costly to promote as an independent brand and joined Master Charge (now MasterCard ). Citibank unsuccessfully tried again from 1977 to 1987 to create a separate credit card brand, the Choice Card . In 1967, First National City Bank reorganized as a one-bank holding company, First National City Corporation, or "Citicorp" for short. However,

3480-431: Was purchased in 1981. In 1981, Citibank chartered a South Dakota subsidiary to take advantage of new laws that raised the state's maximum permissible interest rate on loans to 25% (then the highest in the nation). In many other states, usury laws prevented banks from charging interest that aligned with the extremely high costs of lending money in the late 1970s and early 1980s, making consumer lending unprofitable. There

3540-470: Was taken under an electronic "account sweeping program" where any positive balances from over-payments or double payments were removed without notice to the customers. As a result of the 2007–2008 financial crisis and huge losses in the value of its subprime mortgage assets, Citigroup, the parent of Citibank, received a bailout in the form of an investment from the U.S. Treasury . On November 23, 2008, in addition to an initial investment of $ 25 billion,

3600-516: Was the site of one of America's first bank heists when two burglars, James Honeyman and William J. Murray, made off with tens of thousands of dollars' worth of bank notes, and 398 gold doubloons , the equivalent of $ 52 million in 2013 currency. The bank financed war bonds for the War of 1812 , serving as a founding member of the financial clearinghouse in New York (1853), underwriting the Union during

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