Mellon Financial - History

History

Mellon was founded in 1869 by Thomas Mellon and his sons Andrew W. Mellon and Richard B. Mellon, as T. Mellon & Sons' Bank. In 1902, the institution became Mellon National Bank.

Mellon Bank was the driving force behind the vast majority of the mass production revolution, especially in the Midwestern United States. The Mellon family using the bank as a proxy had direct involvement with founding the modern aluminium, oil, consumer electronics and financial industries. Alcoa, Gulf Oil (now Chevron-Texaco), Westinghouse (now CBS Corporation and Siemens) and Rockwell, all were directly founded and managed by the bank. U.S. Steel (the world's first billion dollar corporation), Heinz, General Motors, Koppers and ExxonMobil (as Rockefeller's Standard Oil) were born and nurtured by Mellon.

In 1920 Andrew left his leadership post of the bank to become the longest serving U.S. Treasury Secretary in history (serving under three separate administrations).

In 1929, Richard founded Mellbank Corporation. In 1946, Mellon National, Mellbank, and the Union Trust Company merged to form Mellon National Bank and Trust Company.

A reorganization in 1972 brought about a name change to Mellon Bank, N.A. and the formation of a holding company, Mellon National Corporation.

In 1983, Mellon bought Girard Bank of Philadelphia and Central Counties Bank of State College, Pennsylvania. The next year, Mellon National Corporation became Mellon Bank Corporation, and purchased Northwest Pennsylvania Corporation of Oil City, Pennsylvania.

In 1986, Mellon bought Commonwealth National Financial of Harrisburg, Pennsylvania.

In 1991, Mellon bought United Penn Bank of Wilkes-Barre, Pennsylvania. The next year, Mellon bought 54 branch offices of Philadelphia-based Philadelphia Savings Fund Society, whose parent company had become insolvent. Philadelphia Savings Fund Society, was the first savings bank in the United States, founded in 1819.

In 1993, Mellon bought The Boston Company from American Express and AFCO Credit Corporation from The Continental Corporation. The next year, Mellon merged with the Dreyfus Corporation, bringing its mutual funds under its umbrella.

1998 saw Mellon's purchase of United Bankshares, Inc., of Miami, 1st Business Bank of Los Angeles, and Founders Asset Management.

In 1999, Martin G. McGuinn became chairman and chief executive officer of Mellon Bank Corporation. Mellon Bank Corporation then became Mellon Financial Corporation. Two years later, it sold its retail banking operations to Citizens Financial Group.

In 2004, Mellon announced it would purchase Safeco Trust Company from Seattle-based Safeco Corporation. The same year, it purchased outstanding shares in London-based Pareto Partners and offered them floor space in Mellon Financial Centre (opened earlier in the year).

In 2006, Mellon announced its plans to merge with Bank of New York.

July 1, 2007, merged with Bank of New York to become The Bank of New York Mellon. Headquarters of the new company are located in New York. It is the world's largest securities servicing firm and one of the world's top ten asset managing firms.

These two companies, along with State Street, followed essentially the same evolution. All were originally large diversified financial service providers, particularly in the corporate banking space in the regions they were located in. However competition in the corporate loans and retail banking businesses saw them jettison these operations in favor of what were believed to be more stable, fee based business: asset management (i.e. investment management in the form of mutual funds and other separately managed accounts) and asset servicing (i.e. corporate trust, stock transfer services and Depository Receipts).

Mellon is a large provider of what are known as controlled disbursement accounts. These are checking accounts in specialized locations which are given early warning by the Federal Reserve as to what checks will be clearing them. Companies can then transfer the exact amount needed to pay those checks, while then investing the unneeded money or using other funds to pay down debt.