Maggie L. Walker Establishes St. Luke Penny Savings Bank, 1903.

The Consolidated Bank and Trust in Richmond, VA served as the oldest Black-owned and operated savings institution until 2005 when it was absorbed by Premier Financial Bancorp Inc. based in Huntington, WV. The building still stands on 320 N 1st St. in Richmond and operates as Premier Bank: Consolidated Division. The bank was established in 1903 by Maggie L. Walker, an African-American civil rights activist and educator. Walker was the first woman to establish and head any financial institution at the time. The bank was first opened under the name St. Luke Penny Savings Bank; it was underwritten by the post-bellum Independent Order of St. Luke, an organization that helped pay for funeral and other expenses for low-income and Black community members after the Civil War. The St. Luke Penny Savings Bank core value was to provide African Americans access to loans for college and entrepreneurial ventures. Walker’s vision, like that of her contemporary civil rights activists, was to keep wealth within the Black community in and around Richmond. She asked of her community: “Let us put our money together; let us use our money; let us put our money out at usury among ourselves, and reap the benefit ourselves.”1

 After Walker founded St. Luke’s in 1903 it steadily increased its deposits.  By the time of the stock market crash in 1929, St. Luke’s had enough assets to absorb all of the other Black-owned banks around the Richmond area.  The resulting merger was named Consolidated Bank and Trust.  From that time on it steadily increased its wealth and assets as well as opening seven new branches in Virginia.  The bank still rested on its core principle of making loans to lower and middle-class customers. 

In later years, the Consolidated Bank came into financial trouble.  Its then-current CEO and President, Vernard William Henley, a highly successful African American and civil rights activist, made some high-risk loans that resulted in defaults that damaged the bank.  Two years after Hensley’s retirement (with 30 years of service) in 2001, nearly all of Consolidated’s branches were closed or sold.  Henley’s successor, Leon L. Scott, was met by further financial trouble with state and federal regulators for unscrupulous loans made to Mechanicsville, VA investors.  In the last year of Consolidated Bank’s autonomous structure it recorded a net loss of $4.5 million.  The bank was then sold to Abigail Adams, a female-owned bank based in Washington, D.C.; this marked the end of the bank’s historic run as the oldest Black-owned savings institution.

The Adams branch kept Consolidated as a subsidiary and thus it retained its original name.  Unfortunately, Adams Bank also experienced financial problems not much later and was absorbed by Premier Bank based in West Virginia.  Premier quickly absorbed Adams and Consolidated Bank.  Now, the original St. Luke’s Penny Savings Bank building in Richmond is identified as the “Consolidated Division” of Premier Bank to retain customer familiarity with the branch.   

 

1. http://www.fedpartnership.gov/minority-banking-timeline/st-luke.cfm http://richmondfreepress.com/news/2014/sep/05/vw-henley-85-former-president-consolidated-bank/ http://www.richmondbizsense.com/2009/08/18/a-legacy-on-the-line/ http://content.time.com/time/specials/packages/article/0,28804,1963424_1963480_1963472,00.html http://richmondfed.org/publications/education/maggie_walker/pdf/mwalker.pdf