The New York Trust Company was a large trust and wholesale-banking business that specialized in servicing large industrial accounts. It merged with the Chemical Corn Exchange Bank and eventually the merged entity became Chemical Bank .
43-557: On April 3, 1889, the New York Security and Trust Company received its certificate of authorization and was formed with Charles S. Fairchild as the first president and "original capital" of $ 1,000,000. Fairchild, a former attorney general of New York under Governors Samuel J. Tilden and Lucius Robinson , was serving as the 38th United States Secretary of the Treasury under President Grover Cleveland immediately before
86-518: 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 the Great Depression and changes to the banking industry in its aftermath. In 1910, attorney Arthur J. Morris (1881–1973) opened
129-491: A case which involved the New York Trust Company as executors of the will of J. H. Purdy against M. Eisner. Justice Oliver Wendell Holmes Jr. delivered the opinion of the court on May 16, 1921, where the judgment was affirmed with costs. In 1929, Artemus L. Gates succeeded Gibson as president of New York Trust, becoming "the youngest president of a large downtown New York bank". The 34 year old Gates (who
172-413: 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
215-568: A large downtown New York bank". The 34 year old Gates (who was the son-in-law of the late Henry P. Davison , a former Liberty National Bank president) had started his career in 1919 with Liberty National Bank, going to New York Trust after the 1920 merger and becoming a vice president in 1926. Gates became chairman of the executive committee and Buckner remained chairman of the board of trustees. As of June 30, 1941, New York Trust reported total assets of $ 694,659,000. In 1941, John E. Bierwith succeeded Gates as president of New York Trust. Gates resigned
258-460: 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
301-598: 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
344-400: 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
387-607: 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 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.,
430-618: The United States Supreme Court heard arguments on Argued April 25 and 26, 1921 in New York Trust Co. v. Eisner , a case which involved the New York Trust Company as executors of the will of J. H. Purdy against M. Eisner. Justice Oliver Wendell Holmes Jr. delivered the opinion of the court on May 16, 1921, where the judgment was affirmed with costs. In 1929, Artemus L. Gates succeeded Gibson as president of New York Trust, becoming "the youngest president of
473-569: 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 the borrower's creditworthiness, and agreed to repay the loan through the purchase of Installment Thrift Certificates in weekly installments that would repay
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#1732764917845516-612: 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 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
559-627: The New York Security and Trust Company merged with the Continental Trust Company (which had been organized in 1890) under the New York Security and Trust name, but occupied the offices of Continental Trust in the Blair & Co. Building on Broad Street . The new firm had capital of $ 3,000,000. Fairchild became chairman of the board of trustees, and the president of Continental, Otto T. Bannard , became president of
602-558: The New York Trust Company, which was based at 24 Broad Street , would merge with Liberty National Bank of New York . Liberty, which had recently absorbed the Scandinavian Trust Company, and was based out of the Equitable Building , had been formed in 1891. After the merger, Buckner succeeded Bannard as chairman of the board, and Harvey Dow Gibson , the former president of Liberty, became president of
645-585: The New York Trust Company. Past presidents of Liberty included such prominent bankers as Henry P. Davison , Thomas Cochran , and Seward Prosser . The merged bank had capital of $ 10,000,000 and "undivided profits and surplus of nearly $ 20,000,000." It occupied offices that had been prepared for Liberty in the American Surety Company Building at 100 Broadway . In 1921, the United States Supreme Court heard arguments on Argued April 25 and 26, 1921 in New York Trust Co. v. Eisner ,
688-472: 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 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
731-425: 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
774-736: The banks largest shareholder was a holding company representing the Henry Phipps estate. In 1959, the New York Trust Company, which was largely a wholesale institution, merged with the Chemical Corn Exchange Bank , largely a "retail" institution, creating the Chemical Bank New York Trust Company , the third largest bank in New York City and the fourth largest in the nation. Before the merger, New York Trust, with seven offices,
817-438: The banks largest shareholder was a holding company representing the Henry Phipps estate. In 1959, the New York Trust Company, which was largely a wholesale institution, merged with the Chemical Corn Exchange Bank , largely a "retail" institution, creating the Chemical Bank New York Trust Company , the third largest bank in New York City and the fourth largest in the nation. Before the merger, New York Trust, with seven offices,
860-400: The board along with Gilbert H. Perkins, who held the post at Chemical Corn. Arthur J. Morris Morris Plan Banks were part of a historic banking system in the United States created to assist the middle class in obtaining loans that were often difficult to obtain at traditional banks. They were established by Arthur J. Morris (1881–1973), a lawyer in Norfolk, Virginia , who noticed
903-474: The board along with Gilbert H. Perkins, who held the post at Chemical Corn. New York Security and Trust Company The New York Trust Company was a large trust and wholesale-banking business that specialized in servicing large industrial accounts. It merged with the Chemical Corn Exchange Bank and eventually the merged entity became Chemical Bank . On April 3, 1889, the New York Security and Trust Company received its certificate of authorization and
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#1732764917845946-403: The board and of the executive committee. In December 1920, it was announced that the New York Trust Company, which was based at 24 Broad Street , would merge with Liberty National Bank of New York . Liberty, which had recently absorbed the Scandinavian Trust Company, and was based out of the Equitable Building , had been formed in 1891. After the merger, Buckner succeeded Bannard as chairman of
989-424: The board of trustees, and the president of Continental, Otto T. Bannard , became president of the new entity, which was renamed the New York Trust Company the following year, effective March 1, 1905. In January 1916, Mortimer N. Buckner , who had worked with Bannard at Continental since 1901, succeeded Bannard as president of the New York Trust Company, while Bannard assumed the newly created position of chairman of
1032-467: The board, and Harvey Dow Gibson , the former president of Liberty, became president of the New York Trust Company. Past presidents of Liberty included such prominent bankers as Henry P. Davison , Thomas Cochran , and Seward Prosser . The merged bank had capital of $ 10,000,000 and "undivided profits and surplus of nearly $ 20,000,000." It occupied offices that had been prepared for Liberty in the American Surety Company Building at 100 Broadway . In 1921,
1075-630: 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
1118-544: The company's formation. Fairchild previously was a partner in the Boston Brahmin investment banking firm of Lee, Higginson & Co. In 1904, the New York Security and Trust Company merged with the Continental Trust Company (which had been organized in 1890) under the New York Security and Trust name, but occupied the offices of Continental Trust in the Blair & Co. Building on Broad Street . The new firm had capital of $ 3,000,000. Fairchild became chairman of
1161-530: The difficulty his working clients had in getting loans. The first was started in 1910 in Norfolk, and the second in Atlanta in 1911. 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
1204-434: 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 the use of automotive financing (through arrangements between the Morris Plan Company of America, essentially a holding company for Morris Plan banks, and
1247-414: The new entity, which was renamed the New York Trust Company the following year, effective March 1, 1905. In January 1916, Mortimer N. Buckner , who had worked with Bannard at Continental since 1901, succeeded Bannard as president of the New York Trust Company, while Bannard assumed the newly created position of chairman of the board and of the executive committee. In December 1920, it was announced that
1290-445: 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
1333-652: The presidency after being appointed the Assistant Secretary of the Navy for Aeronautics by President Franklin D. Roosevelt . In 1949, the New York Trust Company acquired the Fulton Trust Company of New York under the terms of a cash merger agreement involving a purchase price of $ 5,000,000 (i.e. $ 250 a share for 20,000 shares of Fulton Trust). Bierwith remained president of New York Trust, which had assets of $ 670,836,167, and Arthur J. Morris ,
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1376-458: The presidency after being appointed the Assistant Secretary of the Navy for Aeronautics by President Franklin D. Roosevelt . In 1949, the New York Trust Company acquired the Fulton Trust Company of New York under the terms of a cash merger agreement involving a purchase price of $ 5,000,000 (i.e. $ 250 a share for 20,000 shares of Fulton Trust). Bierwith remained president of New York Trust, which had assets of $ 670,836,167, and Arthur J. Morris ,
1419-673: The presidency of the National Distillers Products Corporation and was succeeded by Charles J. Stewart , who had been with New York Trust since 1930. Hulbert Aldrich served as director and president of the company from 1950 through 1959. In 1952, the New York Trust Company management completed a merger deal with the Manufacturers Trust Company involving an exchange of 1 2/3 shares of Manufacturers Trust for each share of New York Trust. New York Trust president Charles J. Stewart
1462-492: The presidency of the National Distillers Products Corporation and was succeeded by Charles J. Stewart , who had been with New York Trust since 1930. Hulbert Aldrich served as director and president of the company from 1950 through 1959. In 1952, the New York Trust Company management completed a merger deal with the Manufacturers Trust Company involving an exchange of 1 2/3 shares of Manufacturers Trust for each share of New York Trust. New York Trust president Charles J. Stewart
1505-418: The president of Fulton Trust (which had assets of $ 36,158,041), became a vice president of the new firm. Charles S. McVeigh, the chairman of Fulton Trust, and three other Fulton Trust trustees, namely Stephen C. Clark , Charles J. Nourse , and Walter N. Stillman, were added to the board of New York Trust, increasing it from eighteen member to twenty-two. In late 1949, Bierwith left New York Trust to assume
1548-416: The president of Fulton Trust (which had assets of $ 36,158,041), became a vice president of the new firm. Charles S. McVeigh, the chairman of Fulton Trust, and three other Fulton Trust trustees, namely Stephen C. Clark , Charles J. Nourse , and Walter N. Stillman, were added to the board of New York Trust, increasing it from eighteen member to twenty-two. In late 1949, Bierwith left New York Trust to assume
1591-508: 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 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
1634-483: Was formed with Charles S. Fairchild as the first president and "original capital" of $ 1,000,000. Fairchild, a former attorney general of New York under Governors Samuel J. Tilden and Lucius Robinson , was serving as the 38th United States Secretary of the Treasury under President Grover Cleveland immediately before the company's formation. Fairchild previously was a partner in the Boston Brahmin investment banking firm of Lee, Higginson & Co. In 1904,
1677-475: Was the ninth largest in New York and Chemical Corn, with ninety-four offices, was the fourth largest. Chemical Corn's chairman and president, Harold H. Helm, remained in those roles post merger, while New York Trust's chairman, Adrian M. Massie, became chairman of the trust committee and general supervisor of the combined trust departments. New York Trust's president, Hulbert S. Aldrich , became vice chairman of
1720-417: Was the ninth largest in New York and Chemical Corn, with ninety-four offices, was the fourth largest. Chemical Corn's chairman and president, Harold H. Helm, remained in those roles post merger, while New York Trust's chairman, Adrian M. Massie, became chairman of the trust committee and general supervisor of the combined trust departments. New York Trust's president, Hulbert S. Aldrich , became vice chairman of
1763-511: Was the son-in-law of the late Henry P. Davison , a former Liberty National Bank president) had started his career in 1919 with Liberty National Bank, going to New York Trust after the 1920 merger and becoming a vice president in 1926. Gates became chairman of the executive committee and Buckner remained chairman of the board of trustees. As of June 30, 1941, New York Trust reported total assets of $ 694,659,000. In 1941, John E. Bierwith succeeded Gates as president of New York Trust. Gates resigned
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1806-482: Was to have become president of Manufacturers Trust in the proposed merger, but New York Trust shareholders protested the arrangement as "not sufficiently rewarding and the agreement was dissolved." After the deal ended, Stewart resigned and shortly afterward and became a general partner of the investment bank Lazard Frères & Company . In 1959, however, Stewart left Lazard Frères to become president of Manufacturers Trust Company, as had been proposed in 1952. By 1958,
1849-480: Was to have become president of Manufacturers Trust in the proposed merger, but New York Trust shareholders protested the arrangement as "not sufficiently rewarding and the agreement was dissolved." After the deal ended, Stewart resigned and shortly afterward and became a general partner of the investment bank Lazard Frères & Company . In 1959, however, Stewart left Lazard Frères to become president of Manufacturers Trust Company, as had been proposed in 1952. By 1958,
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