Girard Bank

Girard Bank was a Philadelphia-based American bank whose name and early business were closely associated with the legacy of financier Stephen Girard, although Stephen Girard did not found the institution that carried his name and had no financial relationship with it. The bank was established in 1831, shortly after Girard's death, by Philadelphia merchants who sought to continue banking under a name that had acquired considerable local prestige. The institution's origins are connected to Stephen Girard's earlier private banking operation. After the charter of the First Bank of the United States expired in 1811, Girard acquired most of its stock and facilities in Philadelphia and opened a private bank on May 18, 1812. He hired George Simpson, formerly cashier of the First Bank, and retained a small staff. Because Pennsylvania law restricted unchartered banking associations but did not prohibit a single individual from conducting banking operations, Girard operated the business personally. His notes initially faced resistance from competing Philadelphia banks, which unsuccessfully sought to force him to incorporate. During the War of 1812, Girard's banking operation became an important source of credit for the federal government. When government credit deteriorated near the end of the conflict, Girard committed most of his resources to the United States and underwrote as much as 95 percent of a government war-loan issue. After the war he became a major shareholder and director of the Second Bank of the United States. When he died in 1831, his personal bank passed into a trust under the terms of his will. The later Girard Bank was chartered by Philadelphia merchants to acquire the banking assets held by that trust and continue the business. The bank subsequently became part of the changing American banking system. Following the National Banking Act, it reorganized in 1863 as Girard National Bank. It acquired the business of Mechanics National Bank in 1903 and expanded its institutional presence in central Philadelphia. In 1908 it completed a monumental headquarters on Broad Street, the Girard Trust Building, designed by architect Frank Furness. A larger tower adjoining the domed building was constructed in 1930–1931 according to designs by McKim, Mead & White. Girard expanded its Philadelphia franchise in the twentieth century. In 1952, Girard Trust Company acquired the Philadelphia branches of Corn Exchange Bank and adopted the name Girard Trust Corn Exchange Bank. The institution used the Girard Trust Bank name from 1964 to 1971 and thereafter generally operated as Girard Bank. In the late 1970s it also became an early participant in automated banking, introducing a proprietary ATM network called George in 1978. The bank's independent identity ended in 1983, when it merged with Mellon Bank in a transaction valued at approximately $220 million. The former Girard institution was immediately renamed Mellon Bank (East). The merger followed changes in Pennsylvania banking law that enabled bank holding companies to own multiple banks and operate more broadly across the state. The integration produced difficulties involving employees, customers, and the loss of the Girard name. Mellon later sold much of the former Girard business to Citizens Bank, approximately two decades after the merger. Girard Bank is therefore defunct as an independent brand, but its architectural and institutional legacy remains visible in Philadelphia. The former domed Girard Trust Building now forms part of The Ritz-Carlton Philadelphia hotel.

Girard Bank emerged in Philadelphia in 1831, following the death of Stephen Girard. Its founders were local merchants who wanted to establish a bank capable of benefiting from the strong reputation associated with Girard's name. The later institution was not founded by Stephen Girard, and available historical accounts distinguish it from his privately controlled banking operation. Stephen Girard's own banking career began after the First Bank of the United States lost its federal charter in 1811. Girard acquired most of the bank's stock and its Philadelphia facilities and opened a private bank on May 18, 1812. George Simpson, who had served as cashier of the First Bank, became cashier of Girard's operation. Girard took advantage of a technical feature of Pennsylvania law: while an association of individuals could not bank without a charter, a single individual was not prohibited from doing so. His bank issued notes based on his personal credit, although established Philadelphia banks initially refused to accept them and pressed the state to intervene. The private bank played a major role in financing the United States during the War of 1812. As federal credit weakened late in the war, Girard committed almost all of his resources to the government and underwrote up to 95 percent of a war-loan issue. He later became a substantial shareholder and director of the Second Bank of the United States. Following his death in 1831, his bank was placed in a trust in accordance with his will. Philadelphia merchants then chartered Girard Bank to purchase the trust-held banking assets and carry on the business. The institution occupied an unusual position in the city's banking system. Despite its later association with the Girard name, it became one of the Pennsylvania banks receiving government deposits transferred by Treasury Secretary Roger B. Taney from the Second Bank of the United States. The bank later adapted to federal banking legislation and reorganized in 1863 as Girard National Bank after passage of the National Banking Act. Girard expanded through acquisitions and major construction projects. In February 1903 it acquired the business of Mechanics National Bank. In 1908 it completed the domed Girard Trust Building on Broad Street, designed by Frank Furness. A tower adjoining the original building was begun in 1930 and completed in 1931; the tower was designed by McKim, Mead & White and occupied a site formerly associated with the West End Trust Building. The complex became one of the most recognizable financial landmarks in Philadelphia. In 1952, Girard Trust Company acquired the Philadelphia branches of Corn Exchange Bank and changed its name to Girard Trust Corn Exchange Bank. The bank operated as Girard Trust Bank from 1964 to 1971 and subsequently used the shorter Girard Bank name. During the 1970s it invested in new delivery channels and in 1978 launched the George automated teller machine network. Philadelphia National Bank responded with its own ATM network in 1979, a development that helped lead to the MAC system with support from additional financial institutions. After the 1983 acquisition, Mellon Bank joined the MAC network. Girard's independent existence ended in 1983. Changes in Pennsylvania law permitted bank holding companies to own multiple banks and made statewide expansion easier. Mellon Bank acquired Girard in a transaction valued at approximately $220 million and promptly renamed the institution Mellon Bank (East). The disappearance of the Girard identity created integration problems among employees and customers. Mellon later sold much of the former Girard business to Citizens Bank roughly two decades after the merger. The former headquarters still survives architecturally; the domed 1908 building is now associated with The Ritz-Carlton Philadelphia hotel.

• 1983

  Acquired by Mellon Bank

  [1]Girard Banken.wikipedia.org

  Girard merged into Mellon Bank in a transaction valued at approximately $220 million and became Mellon Bank (East).

• 1978

  George ATM network launched

  [1]Girard Banken.wikipedia.org

  Girard introduced its proprietary George automated teller machine network.

• 1952

  Corn Exchange Bank branches acquired

  [1]Girard Banken.wikipedia.org

  Girard Trust Company acquired Corn Exchange Bank's Philadelphia branches and adopted the Girard Trust Corn Exchange Bank name.

• 1931

  Broad Street tower completed

  [1]Girard Banken.wikipedia.org

  A tower adjoining the 1908 domed building was completed after construction began in 1930, with designs by McKim, Mead & White.

• 1908

  Girard Trust Building completed

  [1]Girard Banken.wikipedia.org

  The bank completed a new Broad Street headquarters designed by Frank Furness.

• 1903

  Mechanics National Bank business acquired

  [1]Girard Banken.wikipedia.org

  Girard Bank acquired the business of Mechanics National Bank, strengthening its Philadelphia operations.

• 1863

  Reorganization as Girard National Bank

  [1]Girard Banken.wikipedia.org

  The bank reorganized as Girard National Bank following the National Banking Act.

• 1831

  Girard Bank is chartered

  [1]Girard Banken.wikipedia.org

  Philadelphia merchants chartered Girard Bank after Stephen Girard's death to acquire and continue the banking assets held in trust under his will.

• 1812

  Stephen Girard opens a private bank

  [1]Girard Banken.wikipedia.org

  Stephen Girard opened a privately controlled bank in Philadelphia on May 18, 1812, after acquiring much of the former First Bank of the United States's stock and facilities.

A Philadelphia-centered full-service bank whose reputation drew on the legacy of Stephen Girard, with a later emphasis on commercial, retail, branch, institutional, and automated banking services.

• Banking services

  Commercial banking

  Girard provided banking services to businesses and institutions in Philadelphia and surrounding markets. Its historical activities included deposit-taking, credit provision, government-related finance, and branch-based commercial banking. The bank's institutional history also included a major role in extending credit to the United States during the War of 1812 through Stephen Girard's earlier private operation.

• Consumer banking

  Retail and branch banking

  Through its Philadelphia branch network, Girard served individual and local business customers with conventional banking services, including deposits, loans, payments, and account access. The bank expanded this footprint through the acquisition of Philadelphia branches from Corn Exchange Bank in 1952.

• Automated banking · 1978

  George

  George was Girard's proprietary automated teller machine network, introduced in 1978. It represented the bank's early move toward self-service banking and electronic customer access. The initiative also placed Girard in competitive tension with Philadelphia National Bank, which introduced its own network the following year.

• 1983

  Merger with Mellon BankM&A

  Background

  Changes in Pennsylvania law made it possible for bank holding companies to own multiple banks and operate more broadly across the state.

  Action taken

  Girard merged with Mellon Bank in a transaction valued at approximately $220 million and was renamed Mellon Bank (East).

  Aftermath

  Girard lost its independent corporate identity. Integration difficulties affected employees and customers, and much of the former Girard business was later sold to Citizens Bank.

  Transaction value. $220 million (1983)

  Source

• 1978

  Launch of the George ATM networkProduct launch

  Background

  Girard was seeking to modernize customer access and became an early participant in the development of automated banking.

  Action taken

  The bank launched a proprietary automated teller machine network branded George.

  Aftermath

  The initiative contributed to Philadelphia's emerging ATM competition. Philadelphia National Bank launched its own network in 1979, later helping establish the MAC system.

  • Philadelphia National Bank — Philadelphia National Bank introduced its own ATM network in 1979 and supported the development of the MAC system with other financial institutions.

  Source

1. 1Girard Banken.wikipedia.org