The Freedman’s Savings Bank: A Historic Place in the Financial Empowerment of African Americans

By: Monique Nelson 2/21/2014

Treasury Annex BuildingThe Treasury Department is located in one the most historically significant areas in our nation’s history, surrounded by buildings that have existed since the early days of America’s founding.  But few know that the Treasury Annex on Pennsylvania Avenue was built on the site of the Freedman’s Savings and Trust Company, more popularly known as the Freedman’s Savings Bank, which played a notable role in African American history during Reconstruction.
At the end of the Civil War, there ​were approximately four million ex-slaves across the southern states and the District of Columbia.  Congress passed a bill in 1865 that established the Freedmen’s Bureau within the War Department to undertake relief efforts and the necessary reconstruction activities that would lead to full citizenship for these individuals. President Abraham Lincoln signed the bill, which included incorporating the Freedman’s Savings Bank, into law in 1865.  The bank’s purpose was to help newly freed African Americans become more financially stable and expand their access to capital.  Originally, the bank was headquartered in New York, but it later moved to the current site of the Treasury Annex building in Washington.
Freedman's Bank BuildingThe bank was created specifically as a repository for African American veterans, ex-slaves, and their families.  However, it also enabled other community organizations to build their financial strength including several hospitals, schools, and institutions like the St. Elizabeth Home for Colored Children and the Francis Xavier Church’s Orphan Aid Society. 
While there is little documentation on the early presidents of the Freedman’s Savings Bank, the last bank president was the venerable Frederick Douglass.  He is quoted as saying “The whole thing was beautiful.  I had read of this bank when I lived in Rochester, and had indeed been solicited to become one of its trustees, and reluctantly consented to do so:  but when I came to Washington and saw its magnificent brown stone front, its towering height, its perfect appointments, and the fine display it made in the transaction of its business, I felt like the Queen of Sheba when she saw the riches of Solomon, that the ‘half had not been told me’.” Unfortunately, Douglass ended up having to petition Congress to close the bank after it declined rapidly during the panic of 1873.

The bank finally closed its doors in June 1874.  Remarkably, during Freedman’s Savings Bank’s existence, it had over $57 million in deposits and over 70,000 depositors.  But that is not the only part of the bank’s legacy.
Frederick Douglass
Maggie L. Walker
The short-lived success of the Freedman’s Savings Bank inspired other African Americans to establish their own banks.  One of particular interest was the St. Luke Penny Savings Bank, chartered by Maggie L. Walker of Richmond, VA.  Walker was the daughter of a former slave who had been the cook to a Union spy in the Confederate capital of Richmond, VA. She attended the city’s public school and began work with the Independent Order of St. Luke, a black fraternal organization.  In 1902, Walker established a newspaper followed by the bank, serving as the first president.  As a result, she earned the distinction of being the first black woman to charter a bank in the United States. The bank prospered, and after several mergers became The Consolidated Bank and Trust Company.  Maggie Walker served as the first Chairwoman to the Board of Directors until her death in 1934. Historically, the bank was the longest operating African American-owned bank in the United States when another bank acquired it in 2009.
As the Administration continues to celebrate African American History month, these stories about laying important foundations for every citizen’s financial empowerment inspire Treasury’s mission of promoting economic opportunity for all Americans. Working in the historic site where former slaves started a life with unprecedented access to bank accounts imbues this Department with the responsibility to continue improving the financial security of those least fortunate among us today.
Monique Nelson is a member of the Office of the Curator at the United States Department of the Treasury.