Bank of the Manhattan Company

The Bank of the Manhattan Company (established 1799) is the earliest of the predecessor institutions that eventually formed the current JPMorgan Chase & Co.

History

As background, the first corporate bank in New York, organized by Alexander Hamilton in 1784, was chartered in 1792 as the Bank of New York. This bank and the federal bank monopolized the banking industry in the city and state until opposition led by Aaron Burr successfully fought for banking privileges through a clause in a charter for his Manhattan Company, which was established ostensibly to supply much-needed pure water to the City of New York. The Manhattan Company was awarded two million dollars for the water project. There was a clause to the contract which allowed the directors to use any unspent money for any purpose as they so desired. The directors of the Manhattan project used one hundred thousand dollars for supplying water to Manhattan and the rest was used to start the bank. After a multitude of cholera epidemics a water system was finally established 1842 in NYC with the building of what is now known as the Old Croton Reservoir.

On April 17, 1799, the Manhattan Company appointed a committee "to consider the most proper means of employing the capital of the Company" and elected to open an office of discount and deposit. The "Bank" of the Manhattan Company began business on September 1, 1799, in a house at 40 Wall Street. In 1808 the company sold its waterworks, pocketing 1.9 million dollars, to the city and turned completely to banking. Even so, it identified as a water company as late as 1899. The Company maintained a Water Committee which yearly assured, quite truthfully, that no requests for water service had been denied, and moreover conducted its meetings with a pitcher of the water at hand to ensure quality. It is unclear whether anyone at these meetings actually tasted the water.^[1]

The Bank started paying dividends in July 1800, and in 1853 the Manhattan Company became one of the original 52 members of the New York Clearing House Association. In 1923 it moved its headquarters to the Prudence Building. A 1929 merger made Paul Warburg its chairman. The Bank merged with Chase National Bank in 1955 to become Chase Manhattan, and then was acquired by Chemical Bank in 1996, who retained the Chase name, to form what was then the largest bank holding company in the United States. In December 2000, the bank acquired J.P. Morgan & Co. to form JPMorgan Chase & Co.

References

• Bank of the Manhattan Company at Project Gutenberg
• History of JPMorgan Chase
• National Information Center

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