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"Another bank organized in 1865 was the Freedman's
Savings and Trust Company, but this institution, as its name
suggests, did not come under the provisions of the National Bank
Act. The Freedman's Savings and Trust Company came into existence by
a special act of Congress, approved March 3, 1865, upon the petition
of fifty incorporators. Its object was semi-benevolent; at least,
its stated purpose "was to receive on deposit such sums of money as
might be, from time to time offered by on behalf of persons
previously held in slavery, or their descendants, and to invest them
in stocks, bonds, Treasury notes, or other securities of the United
States." The original intention, it seems, was that this institution
should take care of the banking business of most of the freed men
who had come to the North during the Civil War. At the outset, its
place of business was in New York City, but before long the
headquarters were removed to Washington. Its vice-president and
cashier, D.W. Anderson and W.J. Wilson respectively, were negroes,
but its president, J.W. Alvord, was a well known white citizen. So
well conducted were its affairs during the first five years that
Congress, in 1870, expanded the authority of its executives, so as
to enable them to make real estate loans. In this branch of
financing, the officers of the bank were not so successful, and
during the collapse of almost all values following the failure of
Jay Cooke in 1873, the Freedmans' Bank, which had at that time no
less than thirty-four country branches, became hopelessly involved.
In 1874 it went into bankruptcy. Commissioners appointed to take
charge of its affairs in 1875 discovered that the Bank had no less
that 70,000 depositors; that the deposits had totaled $56,000,000;
that $53,000,000 had been paid back. The Comptroller of the Currency
eventually became administrator, and during the next twenty years
more than 62 per cent of the deficiency of $3,000,000 had been
returned to the original depositors or their heirs."
Washington, Past and Present: A History 1930-1932
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