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(Banking, Insurance and Securities- A Philadelphia Heritage)
1740: Fire Insurance with Prevention
Ben Franklin, most notable among America's most famous fire fighters organized the "Philadelphia Contributorship" in 1740 to insure houses from loss by fire. The company identified their insured with "fire marks" that were attached to the front of each insured's property. It also was the first insurance company to make definite contributions toward fire prevention, saving lives and preserving property. It recognized certain hazards and either warned against them or simply refused to insure buildings where these risks existed. For example, wooden buildings were not accepted for insurance and homeowners were cautioned not to smoke meat in their houses, a common practice at that time. They were permitted to have either shade trees or insurance, but not both, as the former were considered definite risks, attracting lightning and interfering with firemen's efforts. The mutual idea "whereby every man might help another without any disservice to himself," has set the standard generations as one of the oldest operating fire insurance companies in the United States.
1780: First State Bank
The Bank of Pennsylvania was created in 1780 to raise money for the Continental Army. The Bank had a special relationship with the Commonwealth of Pennsylvania in providing a method to control currency and credit. It was the precursor to the Federal Government's First Bank of the United States (1791-1811). The Bank continued to operate until the world-wide financial panic of 1857. The bank building then served as a federal prison during the Civil War and was demolished in 1867.
1791: First U.S. Bank
The Continental Congress chartered the Bank of North America in Philadelphia as the nation's first "real" bank to give further financial support to the Revolutionary War and to create a standard form of currency. The first Treasurer, Alexander Hamilton conceived of the bank.
The First Bank's charter was drafted in 1791 by the Congress and signed by President George Washington. When its' 20 year charter expired in 1811, Congress voted to abandon the bank and its charter. It was succeeded by the First Bank of the United States that lasted for a term of five years until 1816.
Its first home was at Carpenters' Hall, where it rented space from 1791-1797, when it moved into its own building, erected between 1795-97 while Philadelphia was still the nation's capital, from designs of Samuel Blodgett, Jr. The original plan called for a building constructed entirely of marble, but to economize, brick was used on the rear and sides. The neo-classical design of the bank was intended to recall the democracy and splendor of ancient Greece. Claudius F. Le Grande, a French sculptor working in Philadelphia (1795-1801), carved the mahogany eagle in the pediment and other architectural features.
The First Bank of the United States is the oldest bank building in America. The bank building was restored for the U.S. Bicentennial in 1976. The building can still be found at Third Street, between Chestnut and Walnut Streets.
1789: First U.S. Paper Money
After adoption of the Constitution in 1789, the first paper notes were authorized by the United States Congress and issued by the First Bank in Philadelphia. At that time, private bank-note companies printed a variety of notes with State chartered banks. In order to eliminate confusion and simplify trade, the Continental Congress adopted the dollar in1785 as the unit for national currency of the United States and then in 1789 authorized the First Bank it to issue the first national paper bank notes. The bank served as the U.S. Treasury's fiscal agent, thus performing the first central bank functions.
1790: First U.S. Stock Exchange
The official organization of the exchange in 1790 came after forty-four years of effort. According to the Philadelphia Stock Exchange history, ‘Colonial Philadelphia's mayors had traditionally closed their term of office with lavish entertainment, but in 1746, Mayor James Hamilton broke with tradition. The following extract from the minutes of an October 7, 1746 meeting of the Philadelphia Board of Aldermen explains why: "James Hamilton, Esq., Mayor, represented to the board that as it had been customary for the mayors of this city, at the going out of their office, to give an entertainment to the gentlemen of the corporation, he intended in lieu thereof, to give a sum of money equal at least to the sum usually expended on such occasions, to be laid out in something permanently useful to the city and proposed the sum of one hundred and fifty Pounds toward erecting an exchange or other public building."
Mayor Hamilton's exit from office started a new tradition. Over the years, the fund grew with donations from successive mayors. However, the Philadelphia merchants who stood to benefit most from an exchange eventually decided to start one without tapping the special fund, which ultimately went to build a new city hall in 1775.'
The City Tavern functioned as the City's exchange from 1790 to 1834. After the City Tavern burned down 1834 the exchange moved to new building. William Strickland, the architect, designed this new Philadelphia Stock Exchange Building on classical Greek models. Built almost entirely of Pennsylvania marble, the exchange building opened for business in 1834. The Philadelphia Stock Exchange is operating in center city Philadelphia in offices apart from the historical building that still be found located at Third and Walnut Street.
1792: First U.S. Mint
The Federal Monetary System was established with the creation of the U.S. Mint in Philadelphia. On April 2, 1792, Congress passed The Coinage Act, which created the Mint and authorized construction of a Mint building in the nation's capitol, Philadelphia. This was the first federal building erected under the Constitution. Secretary of the Treasury Alexander Hamilton personally prepared plans for a national Mint. The first American coins were struck in 1793.
President George Washington appointed Philadelphian David Rittenhouse, a leading American scientist, as the first Director of the Mint. Under Rittenhouse, the Mint produced its first circulating coins; 11,178 copper cents, which were delivered in March 1793. Soon after, the Mint began issuing gold and silver coins as well. President Washington, who lived only a few blocks from the new Mint, is believed to have donated some of his own silver for minting. An Act of Congress in 1828 ensured that the Mint would remain permanently in Philadelphia. There have been four buildings built in the years 1792; 1833; 1901; and 1969; at different locations over its' history to accommodate the increases in production. The Philadelphia Mint designed by architect Vincent G. Kling in 1969 is the largest mint in the world and is located on 5th Street and Arch Streets, north of Market Street across from Independence Mall.
1792: First Marine Insurance Company
After a series of meetings in Philadelphia's Independence Hall, a group of prominent citizens forms the Insurance Company of North America (INA). INA is the first marine insurance company in the United States is the nation's oldest stockholder-owned insurer.
1811: Private Merchant Banking Financier-Stephen Girard
After the United States Congress failed to renew the First U.S. Bank's charter in 1811 the building was sold to Stephen Girard, a merchant, banker and philanthropist, who conducted his private banking business there for the next twenty years. Stephen Girard helped to finance the United States in the War of 1812, and to fund the Second Bank of the United States in 1816.
He was born in Bordeaux in 1750. As the son of a sailor he began his working life as a cabin boy. He first appeared in Philadelphia during the Revolution as a small trader and after some years he was reported in 1790 to have an estate valued at $30,000. Subsequently, through trading with the West Indies, he rapidly amassed wealth. In 1812, when he opened his bank, he had capital of $1,200,000. The public confidence in his integrity made his bank successful and he increased its capital to $4,000,000. When the war with England began in that same year he was able to help finance the war and make a $5,000,000 loan to the United States government. He died in 1831, the wealthiest man in the country, bequeathing to the city the bulk of his huge estate of between $6 to $9 million (including the First Bank building) in trust for the improvement of the City and for constructing and endowing a home and school for poor orphan children. The recipient, Girard College was opened in 1848.
In 1832, after his death, the First Bank building was rented to a newly chartered state bank named Girard Bank (unrelated to Stephen Girard's bank). With the exception of several years during the 1840s Girard Bank and its successor, Girard National Bank of Philadelphia, were the principal tenants in the building until 1926 when the bank merged with the Philadelphia National Bank. In 1954, the federal government purchased the historical First Bank building for the National Park.
1816: Second U.S. Bank
To continue the note worthy incorporation of the First Bank which closed in 1811, the Second Bank of the U.S. was granted a 20-year charter. Modeled on the Parthenon in Greece, the Second Bank of the United States was built in 1818, and chartered for many of the same reasons as its predecessor, the First Bank of the United States. The War of 1812 had left a formidable debt, and inflation grew due to the notes issued by private banks. President Madison signed a bill authorizing the Second Bank in 1816. President Andrew Jackson in 1832 vetoed renewal of the bank charter because he considered U.S. banking as unconstitutional. Today the bank is home to a portrait gallery. Signers of the Declaration and Constitution are captured in the many of the works painted by Charles Wilson Peale, James Sharples and Thomas Sully. The building can still be found at the original location of 420 Chestnut Street between 4th and 5th Streets.
1816: First Savings Fund Society
The Philadelphia Savings Fund Society ("PSFS") was the nation's first savings bank, a venerable Philadelphia institution which had instilled into six generations of Philadelphia school children the virtues of economy, thrift and savings since being founded in 1816 on December 20th, during the presidency of James Madison. Its purpose was to provide working-class Philadelphians with a safe place to deposit their savings and an opportunity to accumulate interest.
The archives of the Philadelphia Saving Fund (1816-1992), are now at the Hagley Museum and Library in Wilmington, Delaware. They contain significant documentation on the bank's working-class depositors. Signature books and deposit ledgers recorded information about the depositors' ethnicity, occupation; place of birth; physical characteristics; marital status; address; and number of years she or he lived in Philadelphia.
Philadelphia First- an Air Conditioned modern high-rise. The Philadelphia Saving Fund Society Building headquarters, completed in 1932, was widely hailed as the most significant architectural structure of its time. Designed by architects George Howe and William Lescaze. The building was the first identifiable International Style high-rise in the world. It was the first building of its class and size in the United States to be completely and centrally air-conditioned year round. Purchased in 1997, a $115 million renovation project preserved the original design of the public spaces and enhanced the acclaimed Modernist style of the building and converted one of the most distinguished Office Towers in the Philadelphia skyline, into a new Hotel facility Located at 12th and Market Streets.
1873:Pioneers of American Securities
In Philadelphia, one example is Charles Barney, founder of his firm in 1873 and Edward B. Smith starting in 1892, who jointly formed a Philadelphia based securities firm. That firm is still strongly rooted in Philadelphia and has been attributed with pioneering the securities exchange and holdings business. It is credited with shaping the United States markets by contributing to New York's Wall Street business district that has evolved into the world's financial capital.
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