First bank in the United States

The Philadelphia Savings Fund Society, known as PSFS, was the first savings bank in the United States, founded in 1816.

For most of its history, PSFS has emphasized practicality in its operations, its office architecture, and its customer-centric focus on its business. PSFS added a modern twist to the Philadelphia landscape in 1932 when it opened a new International Style building at the intersection of Twelfth and Market streets.

The merchants who organized PSFS, led by Condie Raguet (1784-1842), hoped to replicate the success of savings banks in Great Britain. The founders of PSFS avoided using the word "bank" in the name due to public distrust of financial institutions at the time.

PSFS had a humble mission: to uplift poor and working-class communities through the virtue of saving. The bank prioritized customer accessibility and long-term stability. Following this strategy, PSFS invested primarily in government bonds and mortgages.

Loyalty in management style led to compromise and forced adaptation. To secure incorporation in 1819, PSFS leaders agreed to allow the state to set deposit limits. The behavior of depositors, especially migrants who used accounts to accumulate targeted savings, also changed bank policy. PSFS hired translators to assist its large number of immigrant clients and was willing to pay balances on demand. During the Civil War, PSFS executives donated heavily to the city's defense.

Adjustment of bank policies, coupled with the growing use of savings banks by Americans, led to a rapidly growing customer base, including significant populations of African Americans, immigrants, and women. By 1900, about 15 percent of Philadelphia residents had accounts with PSFS.

PSFS moved several times during the nineteenth century, seeking larger premises for its growing business. The humble beginnings at Sixth and Minor streets moved to the 300 block of Walnut Street. In 1868, PSFS built a luxurious headquarters at 700 Walnut Street. In the early twentieth century, several branches served the growing suburban population..

The PSFS building opened at Twelfth and Market streets in 1932 and became an instant landmark. Designed by George Howe (1886-1955) and William Leskadze (1896-1969) in the functional International style, the glass and steel skyscraper attracted both criticism and admiration. It was far from low-rise. The thirty-two-story tower, the first International Style skyscraper in the United States, became a dominant part of the Philadelphia skyline. Observers couldn't help but notice the red neon letters PSFS on top or the WCAU antenna added in the late 1940s.

By 1940, PSFS was the largest financial institution in Philadelphia, serving 80 percent of local households. Many children knew PSFS through its school banking program.

PSFS also worked on urban issues. In 1968, civil rights leader Cecil B. Moore (1915-79) teamed up with PSFS President R. Stewart Rauch (1914-2001) to bring black and white leaders together to form the Good Friday Group. Hoping to prevent unrest, the group raised $1 million to support various social programs. In 1975, PSFS joined two other banks in the Philadelphia Mortgage Plan, aimed at lending in areas previously excluded from lending.

By the early 1980s, PSFS had become the largest mutual savings bank in the country, but it had difficulty adapting to regulation. PSFS quickly absorbed the troubled Western Savings Fund Society, changed its name to Meritor Financial Group, and divested itself of mutual ownership, becoming a publicly traded company. Subsequent attempts to diversify investments proved unprofitable. Meritor sold fifty-four branches and the PSFS name to Mellon Bank in 1989, but the institution did not last long. Regulators seized and sold Meritor's remaining assets in December 1992.

In its heyday, PSFS encouraged savings and home ownership, built significant infrastructure, and acted as a caring corporate citizen. After PSFS/Meritor collapsed in 1992, developers turned its flagship tower into the Loews Hotel. They have retained many of the design elements, including neon letters, to remind visitors of the once distinguished institution.