Billion-Dollar Bank

In Manhattan last week the developing billion-dollar merger of the Chase National Bank and the Mechanics & Metals National Bank (under the name of the Chase National Bank) seemed catalytic to three other banking consolidations similarly stupendous. Talk on Wall Street was that the National City Bank (the greatest in the U. S., with total assets of $1,215,033,702) was in process of absorbing the Corn Exchange Bank; that the Central Union Trust Co., the National Park Bank and the Chemical National Bank might be driven into union by Clarence Dillon, of Dillon, Read & Co. (he is reported a large stockholder in the first two); and that the Irving Bank-Columbia Trust Co. and the Chatham & Phenix National Bank and Trust Co. would join.

Comparable statistics for these banks, based on their most recent (December, 1925) publishing, are:

TOTAL ASSETS

National City $1,215,033,702

Corn Exchange 255,557,954

Total 1,470,591,656

Chase National 638,050,230

Mechanics & Metals 387,893,588

Total 1,025,943,818

Central Union 379,637,593

National Park 240,069,533

Chemical National 199,357,664

Total 819,064,790

Irving Bank-Columbia Trust Co. 454,172,040

Chatham & Phenix 308,848,271

Total 763,020,311

Of these the union of the Chase National and the Mechanics & Metals is most interesting, not only because the merger is the greatest of such in U. S. history or because their combined assets of $1,025,943,818 will make them the second billion-dollar bank in this country (outranked only by the National City), but because their histories, their traditions and their fields have been so dissimilar.

The Chase National Bank was organized 48 years ago with $300,000 capital and 18 clerks. Today it has 1,487 clerks, a capital of $20,000,000, surplus and undivided profits of more than $27,000,000 and deposits of more than $565,000,000. In deposits it ranks second only to the nearly 700 millions of the National City.

Much of its success has been due to Albert Henry ("Al") Wiggin, President 1911-17, Chairman of the Board 1918-21, holder of both jobs since 1921. Son of a smalltown, Massachusetts preacher, he could not afford to go to college. So, at 17, he got a clerk's job in a Boston bank; became an assistant national bank examiner at 23 and soon married Jessie Duncan Hayden of Boston. The panic of 1907 gave him his great opportunity. He had come to Manhattan shortly before. During the crisis J. P. Horgan found two young men upon whom he could rely, Henry Pomeroy Davison (died 1922) and 39-year-old "Al" Wiggin.

Now Mr. Wiggin is a financial giant; his counsel is eagerly sought. He is director and officer in about 30 financial, railroad and industrial organizations, member of a score of clubs, trustee of many philanthropic activities. All through he has kept his reputation of being "tremendously loyal. . . . generous to a fault ... of unlimited courage," of being a hard worker and player, "big, jovial, wholesome." Called by his first name more than any other Wall Street potentate, he is occasionally spoken of as "the man of a million friends."

One of his friends is Gates W. McGarrah, Chairman of the Board of the Mechanics & Metals, who will become Chairman of the Executive Committee of the new bank. (Mr. Wiggin will be Chairman of the combined Board.) He too started banking early, at 18; came to Manhattan and has remained active in banking there more than 40 years. In 1902 he was made President of the old Leather Manufacturers' Bank and, when the Mechanics & Metals absorbed it, became President of the combination in 1904; Chairman of the Board in 1922. He is a director of the German Reichsbank, being on its General Board as a result of the Dawes Plan.

His President of the Mechanics & Metals since 1922, John McHugh, now becomes President of the new Chase National.

The Mechanics & Metals, founded in 1810 and one of the very oldest in the U. S., was originally a labor bank created by members of the Society of Mechanics and Tradesmen for "the benefit of mechanical interests and to be conducive to the more successful conduct of the manufactories of the city." Their initial capitalization was $1,500,000, strong competition for the only three other banks then existing in Manhattan. Its first building was the three-story, onetime home of Alexander Hamilton. Customers approached the counting room over a front lawn, on which thrifty first President John Slidell kept tethered his family cow. He slept in a room above the vault as a deterrent to marauders.

The merging institutions will pool their resources. Besides the $25,000,000 Chase Security Corp., the Chase National puts in its foreign branches at Havana, Cristobal and Panama City and its seven branches in New York City. The Mechanics & Metals contributes its 13 New York City branches, and will become a branch office of the consolidation, which for at least the present will use the headquarters of the Chase National. Certain competing branches will be wiped out to afford economies. Other savings will result from a smaller, combined overhead. Jr.