Albert Henry Wiggin

Background

Albert Henry Wiggin was born on February 21, 1868 in Medfield, Massachussets, the son of James Henry Wiggin, a Unitarian minister, and Laura Newman Wiggin.

Education

He graduated from Dwight School (1882) and English High School (1885) in Boston.

Career

Wiggin went to work as a clerk in the Commonwealth Bank of Boston. He resigned in 1891 to accept a job as an assistant national bank examiner. Forced out of his examiner's job two years later by a Democratic party victory, Wiggin accepted a position as assistant cashier with the Third National Bank of Boston. He left that institution in 1897 to take a vice-presidency with the Eliot National Bank, which he held until 1899, when he became a vice-president of the National Park Bank in New York City. He retained this position until 1904, while holding similar posts at the Mt. Morris and Mutual banks. Able and hardworking, the tall, reserved Wiggin quickly won the attention of prominent New York financiers, two of whom (George F. Baker and Henry P. Davison) asked him to assist them in organizing the Banker's Trust Company (1903). The next year Baker and Davison helped Wiggin secure a vicepresidency with the Chase National Bank. The youngest vice-president in the bank's history, Wiggin rose rapidly, becoming president in 1911 and chairman of the board in 1917. He held one or both of these positions until 1930, when a reorganization of the top executives elevated him to the newly created post of chairman of the governing board, which he occupied until his retirement. Under Wiggin's forceful leadership, the Chase grew from a relatively small bank into the world's largest, its assets climbing from less than $250 million (1904) to $2. 7 billion (1933) and its clientele expanding to include an impressive list of corporate accounts. Wiggin built the Chase by the traditional method of extending services. To profit from the trust business, which was barred to national banks, he helped organize the Mercantile Trust Company (1917); and that year, following precedents set by other banks, he established a security affiliate (Chase Securities Corporation) to underwrite and distribute stocks and bonds, activities also legally denied to commercial banks. Backed by the Chase's mounting resources, the affiliate quickly became a major factor in the securities markets. Wiggin's policy of developing close ties with big business, which he accomplished by recruiting the bank's directors from among the country's largest corporations and by serving himself on fifty-nine corporate boards, also added significantly to the Chase's growth in resources and importance. But his greatest contribution to its development came from a series of mergers, in which the Chase absorbed seven major New York banks, the largest being the Equitable Trust Company, which had resources in excess of $1 billion. This merger, which occurred in 1930, gave the Rockefeller family, through its substantial holdings in the Equitable, a large interest in the Chase. As head of the Chase, Wiggin occupied a prominent and influential position in the world of finance. He was elected chairman of the New York Clearing House Committee (1913) and was reelected for an unprecedented consecutive second term; when World War I broke out in 1914, precipitating a crisis in the world's financial centers, Wiggin took the lead in getting New York's commercial banks to come to New York City's rescue by subscribing to $100 million of its gold notes. He was one of the Wall Street leaders who helped raise $135 million to assist southern cotton growers who were faced with a record crop but cut off from their export markets. Wiggin served as a director of the American Foreign Securities Corporation, organized in 1915 to help France finance its American war purchases. He was also a New York State fuel administrator in 1917-1918. During the last week of October 1929, when stock prices collapsed, Wiggin joined the small group of leading Wall Street bankers who tried but failed to stabilize the market. Early in 1931, when Europe's finances crumbled, he was chosen to represent New York bankers at an international meeting of financiers to deal with the acute problem of Germany's short-term credits; the conference produced the "standstill agreement, " delaying collection of those debts. Wiggin also served as chairman of the American committee of the Bank for International Settlements to study Germany's indebtedness and credit needs. In December 1932, while still engaged in these negotiations, he retired as head of the Chase. He was nearing the bank's mandatory retirement age of sixty-five and, more important, his views on banking differed radically from those of Nelson W. Aldrich, who had become the Chase's president after the Equitable merger. To show their appreciation of Wiggin's service, the Chase's directors voted him an annual life salary of $100, 000, with the understanding that they could call on him to advise the bank "upon important matters affecting its welfare and management. " Wiggin's counsel was never sought because of the damage done to his reputation by the Senate's investigation of Wall Street practices in the 1920's. That probe, conducted in 1933 by a subcommittee of the Committee on Banking and Currency, disclosed that the Chase, like many other metropolitan banks, had used affiliates to circumvent the law. But far more damaging were the revelations deailing Wiggin's private transactions while he headed the Chase and was paid a high salary and even larger bonuses. Ferdinand Pecora, the subcommittee's counsel, showed that Wiggin had used family-owned and controlled investment companies to participate in syndicates managed by the Chase's affiliate, sometimes borrowing from the bank itself to finance these ventures; that he had entered various stock pools, including some dealing in the shares of his own bank; and, worst of all, that he had conducted some of these operations at the height of the 1929 panic. From mid-September through mid-December, when the Chase was a member of the consortium seeking to support prices, Wiggin was selling his own bank's stock short, making a profit of some $4 million. "In the entire investigation, " Pecora concluded, "it is doubtful if there was another instance of a corporate executive who so thoroughly and successfully used his official and fiduciary position for private profit. " Wiggin, however, not only refused to admit any wrongdoing but also defended all his actions, including the use of private Canadian corporations to reduce his income taxes. Nor did he admit of any need to reform the financial system. The Chase's new management thought otherwise. It sought to dissociate itself from Wiggin and his policies, many of which Aldrich openly repudiated. Late in October 1933 Wiggin renounced his pension; and when a group of Chase shareholders filed a $100 million lawsuit against the bank and its officers, he denied the validity of their charges but assumed "sole responsibility" for whatever losses the plaintiffs may have sustained. His $2 million settlement offer was accepted. Except for his services as a director of several corporations, Wiggin led a quiet life in retirement. He continued to support the Boys' Clubs of America, of which he had been a longtime treasurer. "I faced life as a poor boy, " he had said, "and no matter how busy I am I've got time enough to devote to underprivileged boys. " He donated a new building to the Boys' Club of Greenwich, Connecticut, where he had a summer home and where he died. His two daughters were the principal beneficiaries of his estate, estimated at some $18. 9 million.

Achievements

• His greatest contribution to its development came from a series of mergers, in which the Chase absorbed seven major New York banks, the largest being the Equitable Trust Company, which had resources in excess of $1 billion.

Works

More photos

• book

  • Degas Volume v.1 (French Edition)

    (This book was originally published prior to 1923, and rep...)

Personality

Quotes from others about the person

• General Electric's Owen D. Young once described him as "the most colorful and attractive figure in the commercial banking world" of his time.

Connections

In October 1892 he married Jessie Duncan Hayden; they had two daughters.

Father:

James Henry Wiggin

A Unitarian minister

Mother:

Laura Newman Wiggin

Spouse:

Jessie Duncan Hayden