You Can Bank On It

By Terry Hogan

Our ancestors had a time of it when it came to banking. The U.S. didn’t always have a national currency. There were no federal and state regulated banks. There were no insured deposits by FDIC. Banks came. Banks went. Currency was issued. Some was secured with gold and silver. Some weren’t. Sometimes the banks and their currency worked out. Sometimes they didn’t. Sometimes depositors lost. Sometimes shareholders lost. Sometimes they both lost. This was true in states and in territories. This was true in Galesburg too.

Travelers had a time with currency in the old days. It was worse than pre-Euro traveling in Europe. Travelers moving from state to state had to be sure to exchange currencies at the right time. A bank’s currency value (or even acceptance) was geographically dependent. Hold a dollar too long, and it decreased in value or even became worthless as you traveled from one location to another. Oddly enough, Ernest Elmo Calkins records that in Galesburg’s early years, the only "paper money" accepted at par in Galesburg was that of the bank at Hartford, Connecticut. Unfortunately there was no explanation offered why it was so blessed.

Local history records that the first bank (of sorts) in Galesburg was the old Colton’s store. It was the "only game in town" for a number of years. Like a lot of stores of the period, it would advance goods against the crops in the fields of local farmers. When the crops came in and the farmers got paid, the store got paid.

James Dunn started the first "real bank". Being a highly efficient sort of bank, Mr. Dunn was the president, cashier, and teller. Not only did this probably save money, but also it probably reduced the potential for employee complaints. Dunn didn’t issue currency, but he did issue scrip that was accepted locally for some transactions.

Reeds Banking House was opened in Galesburg in 1855. It was a private bank, founded and sponsored by A. D. Reed, Horatio Reed, and E. L. Chapman. In 1857, it became a chartered bank and became "a bank of issue". The worth of the Reed bank is in some dispute. One history observed that even Reed would not accept his own currency at par, nor would Reed accept it at 30 cents on the dollar. However, history being history, a second local county history observed that "Its notes never falling below par." This latter source also politely recorded that "…Mr. Reed removed to Chicago and its affairs were wound up." The other, perhaps less tactful source, reported that the bank closed on Thanksgiving Day, 1863.

Galesburg had its own "wild cat" bank known as Nemaha. T.L. McCoy, who also ran a packinghouse in Galesburg, established the bank in 1855. Local history records that the bank was "…nominally located at Brownsville, Nebraska". As was the case with most wild cat banks, it failed.

The Knox County Savings Bank was organized in 1861, but it met the same fate as Nemaha. Local history records that the depositors were paid, but the shareholders lost.

In January of 1864, the banking business was changing in Galesburg. The First National Bank was opened. C. H. Mathews was President. Frans Colton and E. L. Chapman were Vice President and Cashier, respectively. Presumably this E. L. Chapman was the same individual who was involved with the Reed bank. The First National Bank constructed a new building at the corner of Main and Cherry in 1866.

Not long after the First National Bank, Galesburg had its Second National Bank in May 1864. David Sandborn was President and Edwin Post and Albert Reed were Vice President and Cashier, respectively.

Other banks followed. The Farmers & Mechanics Bank was established in 1870 with C. S. Colton, C. E. Grant, and W. Little as President, Vice President and Cashier, respectively. Calkins, in his "They Broke the Prairie" observed that the Farmers & Mechanics was the "strongest bank" and that it has a directorate composed of "real dirt farmers".

The Galesburg National Bank was established in 1884 with W. W. Wasburn, A. H. Smith, and James H. Losey as President, Vice President and Cashier, respectively.

The Bank of Galesburg was established in 1889 as a state bank and incorporated in 1891.

The 1899 "Illinois and Knox County" history records that there were 19 banks in Knox County with five in Galesburg.

Another bank in Galesburg that had its run was the People’s Trust & Savings Bank. Moses Ocean Williamson (also known as "Mose" and "M.O.") was the president. M.O. was a Swede and a politician. He was born on a Swedish sailing bark, "Maria" in 1850, en route to New York. The captain and his wife were on board the ship, and having no children of their own, offered to adopt the newborn. The offer was not accepted. The baby was named "Moses Ocean" for his unusual birth. The family traveled to Wataga, Illinois and set up housekeeping in a little log cabin south of town. M.O. was a man in local politics and then state politics, and became Illinois State Treasurer in 1900. Carl Sandburg observed in his autobiography ("Always The Young Strangers") "Many Swedes had become voters and a power in politics and business. The Republican leader for years was a banker, Moses O. Williamson, known as "Mose." He was on the Illinois State Committee of the Republican Party and if you wanted a state or Federal office the word was ‘See Mose’." The bank was destined to be lost by merger with another Galesburg bank.

Today we find our old local banks disappearing as a result of mergers and acquisition. Old, friendly, reliable names are replaced with the names of national or international banking institutions that have no or few local roots. This is not to say that it is bad, but rather a reflection of the growing trend of fewer but bigger institutions. The banks’ clients will have to make their own judgment if the trend is good or bad.

But for the local enthusiasts, there are still remnants of Galesburg’s banking past which can be found to help "put the meat on the bones" of your ancestors. For me, these remains are those of the Peoples’ Trust & Savings Bank. M.O. Williamson was not only the President, but he was my great, great great uncle. Thus, for me, relics of the old bank have family ties. They have family significance.

Go out and put the meat on the bones and find the local history to go along with your ancestors. Perhaps it wasn’t a bank. Perhaps it was a store, a farm, a school, the "Q" or the Santa Fe. Whatever the connection, search it out, and record the facts and the setting. Perhaps even add a memento or two, if you don’t already have one rattling around in the closet, the attic, the basement, or under the bed.

Get out and get started on your relatives. It is worth the time.

You Can Bank On It!

April 9, 2002