The Beginning of Banking in Traverse City
Back when lumber was king, TC's founding father built a brick-and-mortar legacy that still stands today.
TRAVERSE CITY – One bank with more than $100 billion dollars in assets; the other a quickly growing locally owned bank founded in 2000. They share one thing in common: a unique and varied history that belongs to both.
The beginnings of the first Traverse City State Bank harken back to a small corner of the Hannah & Lay Mercantile Company store, Traverse City's first and, until 1860, only retail store. Opened by lumber baron business partners Perry Hannah and A. Tracy Lay in 1856 on Bay Street near the Boardman River, the store was the place Hannah & Lay employees went to secure and draw their pay. But as the company and its employee numbers quickly grew, the small section of the store became something of a financial center. Townspeople took to calling it the village bank, and in 1874, it opened its services to the general public.
In the 1880s, the bank was relocated to the company's headquarters, the Hannah-Lay building, then located at the northeast corner of Front and Union streets (now home to Boyne Country Sports and Northwestern Bank offices.) It was started as a branch of the Chicago-based Safety Vault Company, but in 1892 was incorporated into the Traverse City State Bank with deposits totaling more than $1 million dollars.
By the turn of the 20th Century, the bank had outgrown its location inside the company headquarters, so Hannah sought to build a building befitting his bank's success. His choice location? Directly across from Hannah-Lay's headquarters, on the northwest corner of Front and Union streets. Hannah selected local architects F. E. Moore and W. A. Dean to solidify designs he and his son, Julius Hannah, drew up themselves. H. H. Watermann served to build the structure.
On June 20, 1903 Hannah himself placed the cornerstone of the new bank building. By 1904, the bank was completed, built of local brick manufactured at nearby Greilickville and adorned inside and out with ornate designs from the Ionic Greek pillars made of Vermont granite guarding the entranceways to the English veined marble and mahogany woodwork and furnishings.
The building's hallmark, its tower, stood 100 feet and boasted four clock faces made by Seth Thomas Company of Chicago and was purchased through local jeweler J. N. Martinek. Its pendulum weighed 125 pounds; each clock face stretched five feet in diameter.
In the year the bank building was completed, Traverse City State Bank saw a doubling of their capital stock from $100,000 to $200,000 . Perry Hannah didn't live to celebrate his bank's success. He died that year, and on the day of his funeral, while the mercantile and other related industries closed out of respect to the city's founding father, federal laws required his bank remain open until noon.
If Hannah had intended to make his bank building the town's crowning glory and his legacy, it was most certainly a success. For decades after his death, the ornate bank lobby served as bustling gathering place for townspeople, host to displays highlighting the region's agricultural diversity and the place to see and be seen.
Unlike many banks around the nation, TC State Bank survived the Great Depression and, until the early 1950s, the structure was left largely untouched.
But in 1951, progress beckoned: A $100,000 remodel of the first floor yielded an expansion that would include a section used previously for retail space. By 1956, two drive-in windows, a high-speed elevators and air conditioning had been installed. In the midst of changes to the structure, a familiar name emerged. In 1954, a descendant of Perry Hannah, Julius Beers, was elected president of the bank.
During this period of renovation, the original clock tower was stripped down to its steel understructure to determine its stability. While the original clock faces were preserved, the rest of the tower was resurfaced and "modernized." Later, the tower would undergo a series of changes to both the tower roofing as well as the clock faces, spurring much debate from locals.
By 1981, changes in the banking industry led to a merger between Traverse City State Bank and a conglomerate; the resulting bank was renamed Pacesetter Bank & Trust. Old Kent Financial Corporation bought out Pacesetter in 1983; and in 2000, Fifth Third Bank – the building's current occupant – purchased Old Kent.
That same year, two former employees of the old Traverse City State Bank, Pete and Shirlanna Correia, founded a new bank under the old name. Says Connie Deneweth, president and CEO of the new Traverse City State Bank, "Pete and Shirlanna became aware that the name had never been preserved or held, so they got permission from the Michigan Financial Institution Bureau to resurrect the name."
According to Deneweth, the name was a huge part of the bank's early success. Within a year, it had expanded to Suttons Bay, followed by branch locations on Garfield in 2002 and at Copper Ridge in 2005. Says Deneweth, "People wanted the old bank again. They wanted to be with the bank that their parents and grandparents were with."
Today, Traverse City State Bank, located just a few blocks down from the old bank building, employs 75 people at the four branches and boasts total assets of $184 million with $20 million in capital and $164 million in deposits.
Meanwhile, a branch of Fifth Third Bank, a national entity recently named the best-capitalized bank in the United States by Bloomberg, occupies the old bank building on Front Street. Fifth Third employs 70 people at the Front Street location. Its holding company boasts more than $112 billion in assets.
Fifth Third's Community President Mark Eckhoff calls the structure an "historic cornerstone" and says its significance isn't lost on the employees who walk the building's hallowed halls. "Everyone here takes a lot of pride in the monument of the building, as well as the place we hold in Traverse City," he says.
To that end, the bank recently commissioned a massive cleaning of the building and inspection to determine the stability of its understructure. The process started in August; at press time, it was just wrapping up.
Says Eckoff: "After 107 years, [the building] needed a little more of a going over than usual." Here then, to 107 more. BN