Manufacturers Hanover Corporation
Manufacturers Hanover Corporation was an American bank holding company that was formed as the parent of Manufacturers Hanover Trust Company, a large New York City bank formed through a merger in 1961 with ancestor companies, especially the Manufacturers Trust Company, having had a long history in New York banking going back to the 1850s. After 1969, Manufacturers Hanover Trust became a subsidiary of Manufacturers Hanover Corporation. Throughout most of its existence, Manufacturers Hanover Trust was the fourth-largest bank in the United States.
MHT was both a major money center bank and heavily engaged in retail banking. As such, the bank was known for stability and was well established via its personal accounts base tied to New York branch locations as well as having a number of large blue-chip corporate customers. It ran several memorable advertising campaigns in the 1970s and also had some prominent sports sponsorship arrangements. Over time it gained substantial operations in other parts of the United States as well as overseas.
But by the late 1980s, Manufacturers Hanover had fallen in rank among American banks and was troubled by several bad loans, especially ones in Latin America. In 1991 it merged into Chemical Banking Corporation and within a couple of years had disappeared under its name. However it continued to have an influence via some of its executives, internal systems, and its presence at 270 Park Avenue, where successor corporations down to JPMorgan Chase continued to locate their headquarters.
Ancestor history of Manufacturers Trust Company
The roots of Manufacturers Hanover have been traced as far back as 1812, when the New York Manufacturing Co. was founded with a charter that included banking authority.Commonly, however, the history of the Manufacturers Trust line is considered to have started in 1853. That is when the Mechanics' Bank of Williamsburgh was created, in what was then the City of Williamsburgh, a couple of years before its incorporation into Brooklyn.
It mainly serviced business customers in the Second Ward of Williamsburgh, and was considered small in size.
According to one account in the Brooklyn Daily Eagle, the bank's directors were ex-officials of Williamsburgh.
In 1858, the bank changed its name to the Manufacturers' Bank of Brooklyn. Then in 1865, it changed from being a state-chartered bank to a national bank, moved its offices to Lower Manhattan, and took the name Manufacturers National Bank of New York. But the year 1867 saw it foundering financially, and it soon returned to Brooklyn. It took the name Manufacturers National Bank of Brooklyn in 1868, which name it kept into the twentieth century.
Meanwhile, the Citizens Trust Company of Brooklyn had been formed in 1905. Citizens Trust's first acquisition came with its merger with the Broadway Bank of Brooklyn in 1912. Then in 1914, the Manufacturers National Bank and the Citizens Trust Company merged to become the Manufacturers-Citizens Trust Company, with directors and officers of both banks having similar positions in the new entity and the resulting combination becoming the largest bank in the Eastern District of Brooklyn. Some sources view Citizens Trust as the surviving company in this merger, which leads them to trace the Manufacturers Trust line back only to 1905, while others, as previously stated, consider the line to extend back to 1853.
In any case, the new entity had its headquarters at the 774-776 address on Broadway. The following year, the merged bank's name was simplified to the Manufacturers Trust Company. It would stay under the Manufacturers Trust Company name for the next forty-six years.
Manufacturers Trust Company
The head of Manufacturers Trust Company was the noted banker and philanthropist Nathan S. Jonas, who had come over from Citizens Trust. Jonas put into place an ambitious strategy towards expansion, and through various mergers with banks throughout New York City, it became a growing commercial bank. To begin with, Manufacturers Trust acquired a Manhattan presence with its acquisition of the West Side Bank of New York in 1918. Later Manufacturers Trust acquired the Ridgewood National Bank of Queens, the North Side Bank of Brooklyn, the Industrial Savings Bank, and the Columbia Bank of New York. By the time it absorbed the Yorkville Bank of New York in 1925, Manufacturers Trust had become the 29th largest bank in the United States. Having accomplished one of the quickest expansions seen, it also ranked as one of the largest banks within New York City.Acquisitions continued apace. Jonas retired from the bank in 1931, having, according to one account, gained the reputation as "the man who humanized banking." By now the bank's headquarters offices were at the original 55 Broad Street location in Manhattan's Financial District.
Image:Last-minute huddle. Washington, D.C., Dec. 8. Harvey D. Gibson, President of the Manufacturers Trust Company, goes into a last minute huddle with John P. Murphy, Director of the LCCN2016870972.jpg|thumb|left|Harvey D. Gibson, President of the Manufacturers Trust Company, at a 1936 U.S. Senate hearing
However, in 1931, during the Great Depression, Manufacturers Trust was being subjected to serious bank runs, which led to Harvey D. Gibson being named president of the bank, a position he would hold for the next two decades. Working with banking officials at both the national and state levels, Gibson stabilized Manufacturers Trust and then led it in the following year in acquiring the large but financially troubled Chatham Phenix National Bank and Trust Company of New York.
In 1932, Manufacturers Trust created the National Hotel Management Company to centrally oversee the hotels the bank held mortgages on. They appointed hotel pioneer Ralph Hitz as president of the NMH. His appointment was because, even at the height of the Great Depression, Hitz had been able to turn a profit at the New Yorker Hotel, which the Manufacturers Trust also held the mortgage for. By 1940, the NHM had become the largest hotel organization in the United States. It managed the New Yorker, the Lexington, and the Belmont Plaza hotels ; the Congress Hotel ; the Netherland Plaza ; the Adolphus Hotel ; the Van Cleve ; the Book-Cadillac ; the Nicollet Hotel ; the New York Municipal Airport Restaurants ; and the Eastern Slope Inn. The National Hotel Management Company was dissolved within a month of Hitz's death in 1940.
Image:2003-03-NYC-Manufacturers-Trust-Company-Building.jpg|thumb|right|upright|The Manufacturers Trust Company Building, a landmark bank branch at the corner of West 43rd Street and Fifth Avenue in Midtown Manhattan
During the late 1930s and 1940s, Manufacturers Trust introduced several new services to retail banking, including personal loans and loans for property improvement and construction purposes. In 1944, the bank had 67 branches. In 1950, Manufacturers Trust grew even bigger when it acquired the Brooklyn Trust Company after outbidding Chase Bank for it. As a result, the number of branches that the bank had rose to over a hundred. One landmark branch that opened in 1954 at 510 Fifth Avenue in Midtown Manhattan is known as the Manufacturers Trust Company Building; built in the International Style, its spacious luminous feel, large glass facade, and the bank vault's visibility from the street were an immediate success with customers and even became a tourist attraction.
Manufacturers Hanover Trust
Origin in merger
On January 17, 1961, it was announced that Manufacturers Trust Company had agreed to merge with Hanover Bank, creating the Manufacturers Hanover Trust Company. The planned entity would become the fourth-largest bank in the United States and the third-largest in New York City. Charles J. Stewart was the new company's first president and chairman.The bank moved into new headquarters at 350 Park Avenue in Midtown Manhattan during 1961, leasing space from the Uris Buildings Corporation.
The merger was approved by the New York State Banking Department in June 1961 and then by the Federal Reserve Board in September 1961. The merger closed on September 8, 1961, a couple of days after the Fed assent, in an effort to forestall any possible action from the United States Department of Justice Antitrust Division. However, minutes after the merger papers were filed, the Justice Department filed suit against the banks to block it from proceeding.
Image:Grand St Bushwick Av td 03 - Manufacturers Trust Company.jpg|thumb|left|A later branch in Bushwick, Brooklyn
Five years of court cases ensued, complicated by the U.S. Supreme Court case United States v. Philadelphia National Bank, which interpreted the Bank Merger Act of 1960 as to allow the forbiddance of mergers such as the Manufacturers Hanover Trust one. One U.S. court refused to block the merger, while another U.S. court ruled that a "demerger" must take place. During this time, Robert E. McNeill Jr., first president and then chairman and chief executive officer, and Gabriel Hauge, vice chairman and then president of Manufacturers Hanover, led the company's efforts to keep the merger in place. In 1966, a new law was passed by Congress; it clarified the Bank Merger Act and cleared the way for the mergers in question, and Manufacturers Hanover reached an agreement with the Department of Justice.
Years of success
Through its existence, the bank was often referred to as "Manny Hanny."In 1969, a rearrangement was done such that the holding company Manufacturers Hanover Corporation was created, and the bank was made a subsidiary of that. At the same time, shares in Manufacturers Hanover Corporation were listed on the New York Stock Exchange Manufacturers Hanover remained the nation's fourth-largest bank.
Hauge was named chairman in 1971, succeeding McNeill, who retired. But the effective leadership of the corporation went to its president, John F. McGillicuddy, who had risen quickly within the ranks of the bank. In 1979, Hauge retired, and McGillicuddy held all three titles of president, chairman, and chief executive officer.
Image:Manufacturers Hanover Trust presentation folder and interoffice envelope.jpg|thumb|right|MHT presentation folder and interoffice envelope, early-mid-1980s
As a clearing house, Manufacturers Hanover was a core member of the Clearing House Interbank Payments System that began operation in 1970.
It was considered among the top American banks, alongside Citicorp and Chase Manhattan Bank, and had a reputation for stability. Among commercial banks in New York City, it was the only one still willing to distribute food stamps and to cash welfare checks, and the bank became a main source of financing for check-cashing stores. Manufacturers Hanover had a sense of internal loyalty, wherein layoffs were avoided and lifetime employment was fairly common. It also had a sense of loyalty towards its customers, with relationships formed over long associations and activities such as time spent together on golf courses. One successful instance of such a relationship was its successful rescue plan for the troubled Chrysler Corporation.
Image:Manufacturers Hanover Trust stapler and stickers.jpg|thumb|left|MHT office stapler and stickers
As of the early 1970s, MHT was a New York-based bank with a few offices overseas, but then over the next decade, it grew its outside-of-New-York presence substantially.
It grew within New York City as well, finding twice the amount of usable space in 1981 when it moved into new headquarters at 270 Park Avenue, having bought that building from the Union Carbide Corporation. By 1982, it had more than 700 offices across 32 states in the country and another 102 branches across 40 nations around the world. Three operations were headquartered in Dallas, Texas: Manufacturers Hanover Commercial Corp., which did commercial financing; Manufacturers Hanover Leasing Corp., which was the largest bank-associated leasing outfit in the world, with 45 global branches; and MH/Edie Investment Counsel Inc., which offered investment services.
By the early to mid-1980s, Manufacturers Hanover was both a major money center bank and still heavily engaged in retail banking. It grew its merchant banking and investment banking operations, with offices in major financial hubs around the world.
It would establish a division for trading in currency swaps and foreign exchange options. Among banks, Manufacturers Hanover Corporation also contained the second-largest mortgage banking house and the fourth-largest mortgage banking operation in the world, and its consumer finance network was the third largest among banks.
Image:2024-05-20 14 18 39 View northwest along John Street at Water Street in Manhattan, New York City, New York.jpg|thumb|right|upright=0.75|MHT also had a presence in New York's financial district, such as at 130 John Street
MHT was one of the banks that created the CIRRUS interbank network in the early 1980s for providing cash and other personal banking transactions nationwide. For its large internal data processing systems at the time, such as the Wholesale Banking System, a common environment was IBM mainframes running CICS for online applications with IMS as the database and IBM's DB/DC Data Dictionary.
In 1983, Manufacturers Hanover agreed to acquire the CIT Financial Corporation for some $1.5 billion, an amount that no bank holding company had ever spent on a single acquisition before. When the deal closed in 1984, it created the biggest factoring unit across the globe.
An up-and-coming executive was Peter J. Tobin, who was responsible for the bank's controller, accounting, and management information systems. This operation was centered in MHT's offices at 130 John Street in New York's financial district. He became chief financial officer at MHT and played an important role in the CIT acquisition.
Up through the early 1980s, Manufacturers Hanover remained the fourth largest bank in the nation.