Using history to build community, we explore the New South from the end of the Civil War to today through powerful exhibits, programs and dialogue. Our blog is an extension of the programs and exhibits we provide to the Charlotte community and beyond.
Thursday, September 11, 2014
A Century of Change: Charlotte, Banking and the Federal Reserve
Levine Museum of the New South and
the Federal Reserve Bank of Richmond are pleased to co-host a panel discussion,
“A Century of Change: Charlotte, Banking and the Federal Reserve,” on Tuesday,
September 16. Matt Martin, the Richmond Fed’s Charlotte regional executive,
answers questions about the Fed’s founding 100 years ago and the opening of the
Charlotte office in 1927.
was not chosen for a main Fed bank when the Federal Reserve was founded in
1914, so why did the Richmond Fed create an office here in 1927?
Federal Reserve Act was signed into law, the next step became where to locate
the 12 regional Reserve Banks. A spirited competition began around the country.
Charlotte was one of 37 cities that submitted a formal petition for a regional
Reserve Bank. At the time it was one of the smallest cities to apply and was
Charlotte and the rest of the Carolinas became part of the Richmond Federal
Reserve District. Richmond was one of the 12 cities chosen to house a regional
Reserve Bank, opening for business on November 16, 1914. Branches around the
country began to open, and the Richmond Fed’s Baltimore office started
operations in 1918. Although Charlotte did not initially land a regional headquarters,
interest in a branch for Charlotte was high. Bankers in both North Carolina and
South Carolina led a seven-year campaign to get a branch office, noting
Charlotte’s growing importance as a regional financial center and its ideal location
for serving both North Carolina and South Carolina. The Richmond Fed looked
closely at the issue and agreed with these arguments. The Charlotte office
opened on December 1, 1927.
did the Federal Reserve contribute to the rise of Charlotte as a banking center
— what did the opening of a branch office in the city mean?
Loading coins, Charlotte Branch, 1956
has long been a banking center, and the decision to open a Federal Reserve
branch reflected that reality. By the 1920s, Charlotte had become an important
regional banking center supporting key industries like textiles. The banking
and business community believed that having a branch office of the Richmond Fed
would confirm the growing economic importance of the region, as well as provide
support for future growth. After the official announcement that Charlotte would
get a branch office, bankers noted that having the branch would increase
deposits in Charlotte banks (allowing for more lending in the region), speed up
check clearing and other payments, give banks ready access to the discount
window (short-term loans to banks that provided more liquidity) and generally
promote more commerce in the region.
and others in the region at the time also noted the symbolic importance of
having a branch office in Charlotte. One banker, quoted in the December 1, 1927,
Charlotte Observer, said that “Charlotte will be placed in the class of the
most important financial centers in the country.” In a sense, getting the
branch confirmed that Charlotte was a place of enough financial importance to
need one. Confirmation of that notion almost certainly aided further growth in
the way that success often leads to more success. Of course, there were other
important factors at work in the region, but the opening of the branch provided
confirmation those other factors were important.
Matt Martin alongside Hugh McColl, former chairman and CEO of Bank of America; HarveyGantt, former mayor of Charlotte; and Rick Rothacker, author of Banktown: The Rise and Struggles of Charlotte's Big Banks; will participate in a panel discussion moderated by Museum President Emily Zimmern. Tuesday, September 16, 5:30 pm reception; 6:30 pm discussion. Event is FREE, registration is required. Register at http://www.cvent.com/d/k4qf4d.
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