Old Stone Bank

Last updated
Old Stone Bank Building
Old Stone Bank Providence RI.jpg
General information
Address86 South Main St.
Town or cityProvidence, Rhode Island
Estimated completion1854
Technical details
MaterialGranite
Design and construction
Architect(s)C.J. and R.J. Hall
Old Stone Bank
Company type Public
Nasdaq: OSTN
IndustrySavings & Loan
Founded1819;205 years ago (1819) in Providence, Rhode Island as Providence Institution for Savings
DefunctJanuary 29, 1993;31 years ago (1993-01-29)
Fate Insolvency
Successor Citizens Financial Group
Headquarters Providence, Rhode Island, US
Area served
 Rhode Island
Parent Old Stone Corporation

Old Stone Bank was a popular Rhode Island banking institution that was founded in Providence in 1819 as a mutual savings bank that was called Providence Institution for Savings. [1]

Contents

The savings bank was the fourth largest bank in Rhode Island [2] when it was declared insolvent by the Office of Thrift Supervision on January 29, 1993. Providence-based Citizens Bank acquired all of the savings bank's deposits the following year.

History

In 1969, Old Stone Corporation was formed as the holding company for the savings bank. [3]

In the early 1970s the bank adopted as its mascot and "spokesperson" cartoon character Fred Flintstone, who would say in commercials "Yabba-dabba-doo, love that Old Stone Bank!" [4]

The bank's ATMs were called "Ready Freddy". [5]

Old Stone Bank collapsed in the 1980s when the federal government convinced it to take over two failed savings and loan institutions, but reneged on its promise that it would not hurt the bank to do so.

In 1992, Old Stone filed a lawsuit against the government alleging breach of contract. They were awarded $192 million in 2004, but an appeals court reduced the award to 74.5 million, and the Supreme Court declined to hear a further appeal. [6]

The savings bank was seized by the Office of Thrift Supervision on January 29, 1993. [7] [8] In July 1994, Providence-based Citizens Bank, a subsidiary of Citizens Financial Group, acquired all of the deposits and some of the offices of Old Stone from the Resolution Trust Corporation for $133.6 million. [2] [9] [10] As a result of the merger, Citizens closed 11 of the 28 of the former Old Stone branches along with 7 Citizens branches since there was extensive branch overlaps with the two banking organizations. [11]

Interstate expansion

In its first expansion move, Old Stone Corporation acquired the ailing Seattle, Washington-based Citizens Federal Savings and Loan Association for an undisclosed amount with the assistance of the Federal Savings and Loan Insurance Corporation. [12] [13] [14] This federal bailout had cost the tax payers $78.7 million. The new acquisition was renamed Old Stone Bank of Washington. Five years later, Old Stone sold its Washington savings bank to Washington Mutual in June 1990 for $10 million. [15] [16] [17]

Old Stone Bank Building

The landmark Old Stone Bank Building, from which the bank derived its popular nickname and which housed the bank's flagship branch, is located on South Main Street in Providence. The granite edifice with a distinctive gold leaf, spired dome was designed by C.J. and R.J. Hall in 1854 and is a prime example of the style of bank architecture, prevalent from the mid-19th to the mid-20th Century, which communicated stability, strength and permanence.

It was sold by the Resolution Trust Corporation to Brown University for $1.15 million in 1995 to house the Haffenreffer Museum of Anthropology's collection of Native American artifacts. [18] In 1999 Brown decided it was unfeasible to house the collection in the building as the necessary alterations would have altered the historic character of the building. In April 2009 Brown sold the building to Gold Dome Properties, LLC for $2.14 million. [19]

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References

  1. ↑ "Library Catalog Search". Rhode Island Historical Society. Archived from the original on 2011-08-18. Retrieved 2008-07-12.
  2. 1 2 "Citizens Financial Group Inc.: RTC accepts unit's offer for Old Stone's deposits" . Wall Street Journal . July 6, 1994. p. C17. ProQuest   398412264. Citizens Financial Group Inc said its Citizens Bank unit's bid for deposits and certain loans of Old Stone FSB was accepted by RTC. Terms were not disclosed. Old Stone Bank, which was Rhode Island's fourth largest bank, was placed in receivership in 1993.
  3. ↑ Stattler, Rick (2006). "Old Stone Bank Records". Rhode Island Historical Society.
  4. ↑ James, Caryn (May 27, 1994). "Review/Film: The Flintstones; Lovable And Loud, With Wits Of Stone". The New York Times .
  5. ↑ "M&A TV Commercials Financial Services". MacDonald & Associates. Archived from the original on 2007-12-08.
  6. ↑ Downing, Neil (2007-03-25). "Old Stone: Who gets what?". Moneyline. The Providence Journal. Archived from the original on 2011-06-04. Retrieved 2008-07-12.
  7. ↑ Davis, Paul (January 30, 1993). "Federal regulators seize Old Stone Bank Branches to stay open under their supervision" . Providence Journal . pp. A-01. Federal regulators yesterday seized the crippled Old Stone Bank, Rhode Island's second bank failure in two months.
  8. ↑ "Old Stone Bank unit is put in receivership by federal agency" . Wall Street Journal . February 1, 1993. p. B7A. ProQuest   398311890. The OTS has placed Old Stone Corp's Old Stone Bank unit in receivership and chartered a new federal mutual institution to take its place. The OTS said that as of Sep 30, 1992, Old Stone Bank's nonperforming assets totaled $279.1 million, or 14.5% of assets. The new federal institution will be called Old Stone FSB.
  9. ↑ "Company News; Citizens Bank to Acquire Bank In Rhode Island". New York Times . July 6, 1994.
  10. ↑ "Royal Bank of Scotland Group PLC: Citizens subsidiary acquires assets of New England thrift" . Wall Street Journal . July 12, 1994. p. B. ProQuest   398406693. The Citizens Bank unit of Citizens Financial Group Inc has acquired all the deposits and some loans of Old Stone FSB from the RTC for a premium of $133.6 million. Citizens Financial is a unit of Royal Bank of Scotland Group PLC.
  11. ↑ Kostrzewa, John (October 15, 1994). "Citizens to close 18 offices; may cut more jobs of former Old Stone staff" . Providence Journal . pp. B-15. Eighteen branch offices of the newly merged Citizens Bank and former Old Stone Bank will close in mid-January, requiring tens of thousands of customers to move to new locations... Eleven of the 28 Old Stone branches, including the 140-year-old, gold-domed building on South Main Street in downtown Providence that symbolized Old Stone, will be closed. Customers of those branches will be directed to nearby Citizens branches. Seven Citizens branches will close. Customers of those offices will be directed to former Old Stone locations.
  12. ↑ Lane, Polly (December 30, 1985). "Old Stone Buys Citizens Federal" . Seattle Times . p. D9. Citizens Federal Savings & Loan today became Old Stone Bank of Washington in a government-orchestrated acquisition by the Old Stone Corp. of Providence, R.I. The new organization, a federal savings bank, will operate as a subsidiary of Old Stone Corp. Deposits will continue to be insured by the Federal Savings & Loan Insurance Corp. (FSLIC).
  13. ↑ Lane, Polly (December 31, 1985). "FSLIC Helps Rhode Island Firm Buy Citizens" . Seattle Times . p. D3. A financially strapped agency that insures savings and loan deposits had to provide nearly $79 million to induce new ownership for Seattle's financially ailing Citizens Federal Savings & Loan. The Federal Savings & Loan Insurance Corp. (FSLIC), its resources rapidly depleting and its future clouded by congressional efforts to recapitalize it, put up the money so Old Stone Corp. of Providence, R.I., would step in to rescue Citizens. The government-orchestrated acquisition, which yesterday turned Citizens into Old Stone Bank, required the buyer to pump in about $15 million for the troubled lending institution while the Federal Home Loan Bank's insurance arm put up $78.7 million.
  14. ↑ "Old Stone Acquisition Of Citizens Savings Gets Bank Board Nod" . Wall Street Journal . December 31, 1985. p. 1. ProQuest   397928002. The Federal Home Loan Bank Board approved the acquisition of ailing Citizens Savings & Loan Association, Seattle, by Old Stone Corp., a Providence, R.I., thrift holding company. Citizens, a mutual thrift with $477.4 million in assets, was converted to a federally chartered stock savings bank, Old Stone Bank of Washington, effective yesterday. Old Stone Corp. has $3.7 billion in assets. To enable the takeover to occur, the Federal Savings and Loan Insurance Corp. will give the new savings bank some cash and indemnify it from certain liabilities and "possible litigation resulting from the acquisition," a Bank Board spokesman said.
  15. ↑ Bilotti, Armand G.; Holbrook, Robert B. & Izzi, Louis R. Jr. (January 25, 1990). "Old Stone Completes Agreement to Sell Washington Retail Division to Washington Mutual Savings Bank". Business Wire (Press release). p. 1. ProQuest   447086867. Old Stone Corp. Thursday announced the signing of a definitive agreement to sell its Washington state retail division, Old Stone Bank of Washington, to Washington Mutual, a Federal Savings Bank. Originally named Citizens Federal Savings and Loan Association, Old Stone Bank of Washington was acquired with federal assistance by Old Stone Corp. at the end of the 1985.
  16. ↑ Bilotti, Armand G. & Izzi, Louis R. Jr. (May 31, 1990). "Old Stone Completes Sale of Washington Branch Network". Business Wire (Press release). p. 1. ProQuest   447075265. Old Stone Corp. Thursday announced it has completed the sale of its Washington state retail division, Old Stone Bank of Washington, to Washington Mutual, a federal savings bank, a subsidiary of Seattle-based Washington Mutual Savings Bank, for a pre-tax gain of approximately $10 million. Old Stone and Washington Mutual reached a definitive purchase agreement on Jan. 25, 1990 and received regulatory approval for the sale from the Office of Thrift Supervision on April 6, 1990.
  17. ↑ "U.S. Bank Old Stone Bank Sale Completion Announced" . Seattle Post-Intelligencer . June 2, 1990. p. B6. Old Stone Corp. said it has completed the sale of its Washington state retail division, Old Stone Bank of Washington, to Washington Mutual for about $10 million... In 1985, Old Stone acquired the troubled bank, which was formerly the Citizens Federal Savings and Loan Association.
  18. ↑ "The Old Stone Bank in Providence". island-rhode.com.
  19. ↑ Shalvey, Kevin (April 22, 2009). "Brown sells Old Stone Bank for $2.1M". Providence Business News .
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