Financial History Issue 131 (Fall 2019) - Page 33

of the First National Bank of New York. By 1921, it was the second largest national bank in the United States, and during the 1920s it grew larger after a series of merg- ers. Chase National’s securities under- writing affiliate—Chase-Harris, Forbes Securities Corporation—was the result of the merger between its former securi- ties affiliate, Chase Securities Corporation, and the firm of Harris, Forbes & Co. in 1931. Harris, Forbes & Co. traced its his- tory back to N.W. Harris and Company, a bond house founded by Norman Wait Harris in 1881–2. A native of Berkshire, Massachusetts, Norman Harris was the former secretary of the Union Central Life Insurance Company of Cincinnati. After founding N.W. Harris & Co. in Chicago, he also became a founder of the Harris Trust & Savings Bank in 1907. Harris Forbes & Co., a New York invest- ment house, was founded in 1911. Like First National, Chase National Bank found itself in a similar situation after the passage of the Banking Act of 1933. Chase-Harris, Forbes Securities Corporation had to be separated from Chase Bank as did the Chase Corpo- ration, which was “a holding company for various investments of the bank,” including Chase Harris Forbes Corporation. First Boston also “acquired the right to take over the named ‘Harris Forbes,’ its good will and the custody of its records.” The First Boston Corporation (f. 1934, Boston) The newly merged firm was called The First Boston Corporation. John R. Macomber, a native of Framingham, Mas- sachusetts, was named the first chairman. Macomber, a Massachusetts Institute of Technology graduate, had been a former director of First National, vice president of N.W. Harris & Co. and president of Har- ris Forbes & Co. He was also the former chairman of the board of Chase Harris Forbes Corporation. Col. Allan Melvill Pope was named president. The son of a merchant, Pope graduated from the Boston Latin School and the US Military Academy. First Boston Corporation was a publicly held company from its origin. According to the International Directory of Company Histories, it was the first “publicly held underwriting firm.” In 1946, during Macomber and Pope’s tenures, First Boston Corporation took over the Mellon Securities Corporation of Pittsburgh, which “brought in an addi- tional $8 million in capital and access to Mellon’s industrial accounts, among them Alcoa, Allegheny Ludlum, and Gulf Oil.” The following year, Macomber and Pope retired and were succeeded by Harry M. Addinsell and James Coggeshall Jr., respectively. Addinsell was the former president of the Chase Harris Forbes Cor- poration and vice president of Harris, Forbes. He retired in 1951 and was suc- ceeded by George D. Woods. A native of Boston, George David Woods was the son of a shipyard worker. He was raised in Brooklyn and graduated from the Brooklyn Commercial High School before becoming an office boy at Harris, Forbes & Co. and working his way up the firm hierarchy at First Boston. Coggeshall retired in 1962 and was succeeded by Emil J. Pattberg, who had started working at First National Bank of Boston in 1929 “in the ‘cage’” and worked his way up to chairman of the executive committee of First Boston by 1952. Woods left First Boston and became the president of the World Bank in 1963. First Boston Inc. (f. 1976, holding company) In 1971, Pattberg was succeeded by Ralph Saul, the president of the American Stock Exchange who was recruited from out- side the firm to deal with the financial challenges the firm experienced in the late 1960s when trading volume dropped and profits dramatically declined. During his tenure, First Boston Corporation joined the New York Stock Exchange in 1971 and became “the first publicly held investment bank to be granted membership.” In 1975, George L. Shinn, an Amherst graduate, was recruited to become chairman and CEO of First Boston. Shinn had been the president and chief operating officer of Merrill Lynch since 1973 and had been with the Merrill firm since 1948. Alexander Tomlinson, a member of Morgan Stanley, joined the firm in 1976 and became chair- man of the executive committee. That year, “in March, 1976, First Boston Cor- poration became a wholly owned subsid- iary of First Boston Inc.” During Shinn’s tenure, First Boston Corporation created an alliance with Credit Suisse to create Financiere Credit-Suisse First Boston, a European holding company, in 1978. First Boston’s alliance with Credit Suisse stemmed from the acquisition of White, Weld Holdings, Inc., the parent holding company of White, Weld & Company, by Merrill Lynch & Co. in 1978. White, Weld & Co. was then merged into Merrill Lynch, Pierce, Fenner & Smith, Inc., Mer- rill’s brokerage subsidiary. White Weld’s relationship with Credit Suisse dated back to 1962. That year, White, Weld & Co. sold its Zurich subsidiary to Credit Suisse, White, Weld & Co. AG. The subsidiary was renamed Clariden Finanz AG (later Clariden Bank). Eight years later, in 1970, Credit Suisse and White, Weld & Co. cre- ated WW Trust, a holding company for the Clariden subsidiary. In 1974, “Credit Suisse became the largest shareholder in WW Trust, which was renamed Société Anonyme Financiére du Crédit Suisse et de White Weld (CS&WW). In 1978, when Merrill Lynch bought White Weld, it also bought “a minority interest in Financiere du Credit Suisse et de White, Weld and www.MoAF.org  |  Fall 2019  |  FINANCIAL HISTORY  31