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By Lisa Schofield Photograph Courtesy Provident Bank
The economy may look bleak right now, especially when it comes to the banking sector. But as one New Jersey bank reminds us, Americans have managed to ride successfully through economic storms since our nation’s birth.
It was in 1839, despite a dismal financial landscape, that Provident Bank opened its doors in Jersey City. Only two years earlier panic had set in when the value of U.S. banknotes became so questionable that the federal government began accepting only silver or gold as payment for public land or taxes, causing many commercial banks to collapse.
The idea that Jersey City should establish its own savings bank was first proposed by local businessmen who gathered regularly around the stove at a local store. This group of men recognized that by pooling many small deposits they could make new investment capital available to Jersey City, and thus help the community survive. The new savings bank was to be founded as a philanthropic organization to assist Jersey City’s working class—the immigrant poor who came to America to labor on the city’s wharves and in its factories.
In 1838, Provident’s founders petitioned the state to charter the bank, and on February 27, 1839, the New Jersey Legislature passed a bill creating the Provident Institution for Savings in Jersey City, the state’s first mutual savings bank. Many of the men who incorporated Provident—namely, Cornelius Van Vorst, David Henderson, Peter Sip, Hartman Van Wagener, and Jacob Vreeland—also incorporated the City of Jersey City. Provident’s first active president, Dudley Gregory, was also the first mayor of Jersey City. Thanks to Gregory, sound judgment was instilled as one of Provident’s principles, and is perhaps what has guided the bank through the various financial storms of the past 170 years.
Provident was among the rare few banking institutions that withstood the stock market crash on October 24, 1929. When President Roosevelt declared a “bank holiday” in 1933, Provident was one of the first banks permitted to re-open. Provident not only kept on course but actually grew, thanks to its Depression Era president, James Throckmorton—by 1935, Provident had more than 25,000 depositors and assets of more than $38 million.
In the 1970s, banking regulations changed, allowing banks to expand beyond their home areas. Provident seized this opportunity and established its first out-of-town branch in West New York. As territorial restrictions on banks continued to change over the years, Provident expanded outside of Hudson County, acquiring banks in Dunellen and Bloomfield, and opening new branches in Bergen, Essex, Monmouth, Ocean, Somerset, Middlesex, and Mercer counties.
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