Pittsburgh, PA
August 20, 2019
    News           Sports           Lifestyle           Classifieds           About Us
The Dining Guide
National Job Network
Commercial Real Estate
Place an Ad
Headlines by E-mail
Home >  Business Printer-friendly versionE-mail this story
For 132 years, Mellon money fed industrial engine that transformed Pittsburgh, nation

Wednesday, July 18, 2001

By Milan Simonich, Post-Gazette Staff Writer

Mellon Bank's story of wealth and power began with one man's angst and ambition.

Judge Thomas Mellon was 56 years old when he reached his crossroads in life.

Burned out on courtrooms and lawyers, with his term as an Allegheny County Common Pleas Court judge about to expire, he wanted -- and needed -- a fresh start. The year was 1869.

"In view of the condition of the times, and the position it might afford for some of my younger sons, I concluded to open a banking house," he wrote in his autobiography, "Thomas Mellon and His Times."

T. Mellon & Sons' Bank started on the first floor of a two-story building that stretched from 512 to 514 Smithfield St. The sons in this family venture were Andrew W., then 14, and Richard B., who was 11. Both would become rich and worldly because of this family business that began so inauspiciously.

Plenty of competition existed in Pittsburgh banking during the post-Civil War era when T. Mellon & Sons' Bank flung open its doors. Mellon, though, seized the key moment, when rural landscapes were being transformed into manufacturing zones.

Soon after it opened, the bank forged ties with 21-year-old bookkeeper Henry Clay Frick, lending him $10,000 in 1871 to build coke ovens, launching his empire.

Mellon invested in coal, railroads, steel, glassmaking and electricity. By 1900, the bank had financial ties to virtually every large industrial firm in the region -- except Carnegie Steel Corp., the forerunner to U.S. Steel.

It often would provide loans in exchange for stock, such as when it assisted an upstart company seeking to produce a new metal, aluminum. The company became Alcoa.

Mellon once held controlling stakes in Gulf Oil, Alcoa and Koppers, and exercised influence over Westinghouse Electric, PPG Industries and other corporate giants.

Thomas Mellon made it happen by sheer force of will. In his autobiography, which he finished in 1885, he told of rebuffing his own father, who had tried to steer him to a simple life on the farm.

The Mellons had left Northern Ireland in 1818 to settle in Westmoreland County. Mellon was just 17 when he explained to his father that, no, he would not till soil for the rest of his life. He wanted a faster pace for himself and a chance to leave his mark on the world.

At 14, he had read Benjamin Franklin's autobiography and been inspired. Franklin's rise from poverty to power was the life that Mellon wanted to imitate.

Ever mindful of that turning point, Mellon eventually graced his Pittsburgh bank with a statue of Franklin. By then, the idea that Mellon would exert influence across the planet no longer was in question.

Mellon money helped make Pittsburgh into the world's greatest manufacturing center. It also underwrote ventures that helped the University of Pittsburgh and Carnegie Mellon University become renowned research institutions in medicine and industry.

Thomas Mellon died in 1908 at age 95, but his banker sons and their offspring remained prominent in shaping industry and public policy.

Son Andrew W. Mellon left the bank in 1921 to become Treasury secretary under President Warren G. Harding. He kept the post in the Coolidge and Hoover administrations.

Outside the presidential cabinet, he left another mark. The donation of his immense art collection was instrumental in founding the National Gallery of Art in Washington, D.C.

Richard B. Mellon's son, Richard King Mellon, was at the center Pittsburgh's renaissance, teaming with a Democrat, Mayor David L. Lawrence, to rid the city of much of its grime and decay, and organizing the Allegheny Conference on Community Development to get major corporations behind the effort.

As for the bank itself, its fortunes faded in the 1980s when it almost went bankrupt because of nearly $1 billion in sour real estate and Third World loans. But it rebounded again in a changing economy, hitching itself to financial planning and new ventures in mutual funds and other investments.

Now more changes loom. Mellon Financial Corp.'s retail banking operations are being sold to a unit of The Royal Bank of Scotland Group, Britain's second-largest bank.

Thomas Mellon, the man whose vision started the empire, could not have fathomed such change. In 1885, he admitted that the business world was passing him by.

"To the general public which surrounds me now," he wrote, "I am a stranger in a strange land."

Back to top Back to top E-mail this story E-mail this story
Search | Contact Us |  Site Map | Terms of Use |  Privacy Policy |  Advertise | Help |  Corrections