Henry P. Davison

Henry Pomeroy Davison (1867 to 1922) was an American banker who organized the Bankers Trust Company in 1903 with other New York bankers and served as one of its voting trustees, became a partner of J. P. Morgan & Co. on January 1, 1909, and chaired the War Council of the American Red Cross from 1917 to 1919. He was the father of F. Trubee Davison, who organized the First Yale Unit, and of Henry P. Davison Jr., who became a Morgan partner in 1929.¹

Troy, Bridgeport and the first banks

Davison was born in 1867 in Troy, Pennsylvania. The family finding aid gives June 12 as his birth date, and the New York Times obituary gives June 13.¹² The finding aid says that he began as a bookkeeper in a bank managed by a family member. The obituary says that he taught school as a teenager, gave his sisters what remained of the family fortune for their education, and entered the Astor Place National Bank. At twenty-one, according to the finding aid, he took a post at a bank in Bridgeport, Connecticut, where he met Mary Kate Trubee, who was born in Bridgeport on February 2, 1871. They married on April 13, 1893.¹

The finding aid places the move to New York City in 1896, when Davison took a post at the Astor Place Bank.¹ The 1915 account in the New York Times gives a different sequence. It says that Davison was paying teller at the Astor Place Bank and that in December 1894 he became assistant cashier of the Liberty National Bank, which he served as cashier, vice president and then president within five years; the 1922 obituary says that he became its head at thirty-two.³² Davison later told the Pujo Committee that he had been president of the Liberty National Bank and that "I resigned that position to take the position with the First National Bank."⁴

First National Bank and the Pujo testimony

Asked when he became vice president of the First National Bank of New York, Davison answered "On the 1st of January, 1902."⁴ Under questioning from Samuel Untermyer, George F. Baker confirmed that Davison "was our vice president" and that Davison had been vice president of the First National Bank before Thomas W. Lamont succeeded him in that post.⁵ An exhibit in the same hearings lists Davison among the six trustees of the First Security Company, the affiliate of the First National Bank whose voting rights were held by its trustees, with George F. Baker, H. C. Fahnestock, F. L. Hine, George F. Baker Jr. and Charles D. Backus.⁶

In his own testimony of January 23, 1913, Davison said that he had been eight years at the Liberty bank and seven at the First National.⁷ He listed his boards. He was a director of the Liberty National Bank and chairman of its executive committee, which had twelve members including Edward C. Converse, Seward Prosser, Daniel G. Reid, A. H. Wiggin and himself. He was a director and chairman of the executive committee of the Astor Trust Company, whose committee included Lamont, Gates W. McGarrah, William H. Porter and Benjamin Strong. He was a director of the First National Bank, the Chemical National Bank, the Bank of Commerce (New York) and the First Security Company, and a director and voting trustee of the Guaranty Trust Company and the Bankers Trust Company. He said that his personal counsel, George B. Case of White & Case, sat on the Liberty executive committee and that the firm was counsel to the Liberty bank, the Astor Trust and the Bankers Trust.⁸

Walter E. Frew, a director of the Bankers Trust Company since about 1905, was asked in the same hearings whether "Mr. H. P. Davison, of J. P. Morgan & Co.?" was a Morgan partner. Frew answered, "Of the First National Bank at that time." Asked whether Davison was a member of the firm, Frew said, "He is now; yes, sir. He was not at the time."⁹

Bankers Trust Company

Davison testified that "Several of the younger bankers in New York organized the Bankers Trust Co. in 1903."¹⁰ He said that the company "opened for business on the 30th of March, 1903."¹¹ Advertisements in the New York Times on April 1, 5, 7 and 23, 1903 give the company's address as 143 Liberty Street, its capital as $1,000,000 and its president as Edward C. Converse. The April 23 notice names as directors Edgar L. Marston, Stephen Baker of the Bank of the Manhattan Company, Samuel G. Bayne of the Seaboard National Bank, James G. Cannon, Converse, "Henry P. Davison, Vice-Pres, First National Bank," James H. Eckels of the Commercial National Bank of Chicago, Granville W. Garth, A. Barton Hepburn, William Logan, McGarrah and Edward F. C. Young, and the April 5 notice also names George W. Perkins of J. P. Morgan & Co., William H. Porter, Wiggin and Robert Winsor. Its officers were Converse as president, John F. Thompson as vice president, Lamont as secretary and treasurer and D. E. Pomeroy as assistant treasurer.¹²¹³

The company's stock went into a voting trust. Davison described the purpose: "The particular purpose of that was to preclude the purchase overnight of the control of that company by individuals who were at that time active in New York, whose credit and responsibility were somewhat under question." He added that these men were "regarded as promoters."¹⁰ Untermyer then read from the voting trust agreement, dated March 18, 1903, a recital that the agreement "formed a part of the consideration for the said subscriptions to said stock." Davison answered that it did not refresh his memory and that he was "perfectly willing to concede it."¹¹ Untermyer put into evidence three agreements: the first, of March 18, 1903, naming Davison, Perkins and Daniel G. Reid as voting trustees for five years; a second, of March 18, 1908, for a further five years; and a third, of March 9, 1912, naming Davison, George B. Case and Reid.¹⁴

Pressed on the role of J. P. Morgan & Co., Davison said that "they were individuals," that the founders were "young men" with reputations still to make in New York, and that "Morgan & Co. were not in any way important in the organization of the company." He acknowledged that Perkins was then a member of the firm and said that "it was Mr. Perkins and not Morgan that was in that."¹⁵ Frew testified that the voting trustees were "Henry P. Davison, George W. Perkins, and Daniel G. Reid."⁹

Davison also testified that the Guaranty Trust stock was "purchased in the interest of the Bankers Trust Co." and that the purchasers had in mind "merging the Guaranty Trust Co. and the Bankers Trust Co."¹⁶ He had negotiated the purchase of about 6,000 shares of the Guaranty Trust Company from the Mutual Life Insurance Company with its president, Mr. Peabody, in the early part of 1910, and a voting trust agreement for the Guaranty stock was dated January 3, 1910. Baker confirmed that Davison and Porter were his co-trustees there.¹⁶¹⁷

The 1922 obituary says that Davison conceived "the idea of a trust depository for national bank money," a company that could act as a depositary for national bank and insurance funds, and that a marble tablet in the company's building at Wall and Nassau Streets records the directors' appreciation of "the services of Henry Pomeroy Davison in the organization and upbuilding of the company and the erection of its permanent home."² A New York Times article of October 6, 1915 calls him "the chief organizer of the trust company." It says that one of the company's purposes was to supply a tenant to relieve the Liberty bank of its lease in the New Jersey Central Building, and it places the organization of the company in 1908. The voting trust of the company was renewed on March 18, 1908.³¹⁴

The panic of 1907

During the October 1907 panic the New York Clearing House issued clearing house certificates, and a special committee was "appointed to pass on the collateral." Frank A. Vanderlip, who was then with the National City Bank, named its members as A. H. Wiggin, Gates W. McGarrah, Davison, Walter E. Frew and James G. Cannon, and identified Davison as "a vice-president of the First National Bank."¹⁸ Vanderlip later wrote that "Henry Davison and Paul Warburg were others who had my deep respect after the panic."¹⁹ The obituary says that Davison's counsel was sought at the start of the panic, that he was made a member of a special Clearing House committee, and that his work "was highly praised by George F. Baker" and caught the eye of J. P. Morgan.²

Vanderlip also records a February 1910 conference at the Morgan offices with J. P. Morgan Jr. and Davison about the Bank of Commerce, which he said was then a cloud on the horizon of the National City Bank. Vanderlip wrote that the Morgan partners "were fearful, they told me, that the Bank of Commerce would become a derelict in the financial sea unless the house of Morgan took command of it." At the end of 1910 Jack Morgan and Davison proposed a pool to buy the stock of the Bank of Commerce held by the Equitable Life Assurance Society. "Davison and Jack Morgan told me plainly that delay was impossible," Vanderlip wrote, and the plan brought in Kuhn, Loeb and Company, which the Morgan partners said George F. Baker regarded as necessary. He recorded that "It was left to Davison, J. P. Morgan, Jr., and myself to work out the details."²⁰

Partner in J. P. Morgan & Co.

The obituary says that late in 1908 J. P. Morgan invited Davison "to become a partner" in the firm.² Davison testified before the Pujo subcommittee that he was "a member of the firm of J. P. Morgan & Co." and gave the start date as "Since the 1st of January, 1909."⁴ The family finding aid calls him a senior partner from 1909.¹

In the Pujo testimony of December 1912 Morgan read the names of the partners of the New York house into the record, and the list included "Henry P. Davison" beside Charles Steele, Lamont and Arthur E. Newbold.²¹ Davison told the subcommittee that Steele was the member of the firm best informed about the Southern Railway, and, asked whether Morgan & Co. were the railway's fiscal agents, answered "I do not think we are, officially. We are in fact."²²

Jekyll Island and the National Monetary Commission

Vanderlip opened the chapter of his memoir on the Jekyll Island meeting with a statement of motive: "there was an occasion, near the close of 1910, when I was as secretive, indeed, as furtive as any conspirator. None of us who participated felt that we were conspirators; on the contrary we felt we were engaged in a patriotic work." He added: "I do not feel it is any exaggeration to speak of our secret expedition to Jekyl Island as the occasion of the actual conception of what eventually became the Federal Reserve System."²³

The letter that began the episode came from James Stillman in Paris. It reported that Nelson W. Aldrich "regretted that Henry Davison of J. P. Morgan and Company and I had been unable to join him in Europe during the summer," and that Stillman had told Aldrich the freedom from interruptions could be had "by getting Davison and me down to his estate in Rhode Island without any one's knowing of it."²⁴ Vanderlip described the Commission's European summer as a pleasant one, after which its members "returned to the United States without any definite idea of what they ought to do."²³ The roster printed in the Commission's 1910 volume of interviews names Aldrich as chairman, Edward B. Vreeland as vice chairman, fifteen other senators and representatives (among them Arsene P. Pujo of Louisiana, who chaired the House subcommittee that heard Davison in 1913), Arthur B. Shelton as secretary and A. Piatt Andrew as special assistant. Davison is not on it.²⁵⁴ The obituary says nonetheless that Davison was appointed "expert on banking" to the National Monetary Commission, which visited France, Germany and England, and that while abroad he met European financiers.²

Vanderlip wrote that the men asked to attend the late 1910 meeting were "Henry Davison, Paul Warburg, Ben Strong, and myself," with Andrew coming from Washington, D.C., where he was Assistant Secretary of the Treasury. "We were told to leave our last names behind us," and they were instructed to arrive one at a time at the railroad terminal on the New Jersey side of the Hudson where Aldrich's private car stood. Aboard they used the first names "Ben," "Paul," "Nelson" and "Abe," and Davison and Vanderlip "adopted even deeper disguises, abandoning our own first names. On the theory that we were always right, he became Wilbur and I became Orville, after those two aviation pioneers, the Wright brothers."²⁶

The party was taken by boat to Jekyll Island, Georgia, where for "a week or ten days" they were "completely secluded, without any contact by telephone or telegraph with the outside." Vanderlip wrote that "Sometimes Davison and Strong would be up at day-break to get a horseback ride, or a swim before breakfast," that "Harry Davison was a splendid person to prevent wrangles in any company," and that Warburg, who "apparently felt a little antagonism toward Aldrich," was eased by Davison: "Always he could be counted on to crack a joke just at the right moment to ease a strain." The six, with Vanderlip as the stenographer, came away with "a bill that we felt, pridefully, should be presented to Congress," which "became known to the country as the Aldrich Plan." On return Warburg, Davison, Strong and Vanderlip went back to New York, and Strong and Vanderlip went on to Washington to prepare the accompanying report when Aldrich fell ill.²⁷

Vanderlip wrote that, had the meeting been known, the headlines would have run over "a story that Aldrich was conferring about new money legislation with a Morgan partner and the president of the biggest bank," and that "the bill we drafted did not get through Congress."²⁸ The family finding aid says that Davison attended a secret meeting at Jekyll Island in 1910, and states: "Many believe this meeting led to the creation of the Federal Reserve."¹

The Hukuang loan and the Six-Power negotiations

The 1922 obituary says that in 1910 the American group of bankers chose Davison as its official representative in the Six-Power Chinese loan negotiations in Paris, and that he was made chairman of the conference.² The United States government printed the memorandum of terms agreed at the Banque de l'Indo-Chine in Paris on May 23, 1910, among the British, German, French and American banking groups for a loan of 6,000,000 pounds for the Hankow-Canton and Hankow-Chengtu railways. The loan was "to be divided equally between the four groups." The memorandum names the London firm of Morgan, Grenfell & Co. as representing the American group, and is signed for the American group by E. C. Grenfell, H. P. Davison, Max Warburg, H. H. Harjes and Willard Straight. The document was forwarded by Ambassador Robert Bacon to the Secretary of State from Paris on May 27, 1910.²⁹

On March 18, 1913 President Woodrow Wilson issued a statement on the proposed reorganization loan to China. It said that "a certain group of American bankers undertook to participate in the loan now desired by the Government of China (approximately $125,000,000)" at the request of the previous administration, that the group had asked whether the new administration would request them to participate, and that "The administration has declined to make such request, because it did not approve the conditions of the loan." The text continued that the conditions "touch very nearly the administrative independence of China itself" and closed with the open door: "This is the only door we care to enter." The American group, in a letter of March 19, 1913 signed by Willard Straight, recorded that it held a one-fourth share in a 400,000 pound advance of May 23, 1911 under the currency-loan agreement and a one-sixth share, with the other five groups, in the advances made to the Chinese government in 1912.³⁰

The British commercial agency

On November 25, 1914 Davison sailed for Liverpool on the White Star liner Adriatic with Sir George Paish, the financial adviser to the British Treasury who had spent six weeks in New York. The New York Times reported that Davison was "going on a business trip to London and Paris," and quoted him as saying that the country "was never in a better condition for an extended trade." J. P. Morgan Jr. was at the pier and told Paish that "if there was anything the New York bank house could do to improve the situation action would not be denied."³¹ Two days earlier the Times had reported that the New York bankers who drafted the report of their conferences with Paish and Basil Blackett had asked Davison and James Brown to continue the discussion in London.³²

On December 4, 1914 the Times reported that Davison, accompanied by Straight, had arrived in England, and a London dispatch of December 5 stated that neither Davison nor Paish would add to their previous statements while conferences on the adjustment of foreign exchange continued.³³ On January 23, 1915 Davison and Straight returned on the Cunarder Lusitania. The Times reported that he "explained that his firm had been appointed the sole commercial agents for Great Britain in the United States," meaning "all purchases in this country for Great Britain would be made through J. P. Morgan & Co.," and that he "did not mean fiscal or financial agents" and would not discuss whether the firm was connected with the financial concerns of the British government.³⁴ An editorial in the same issue noted that "Mr. Davison returns with the appointment of his firm as the agents for the payment of British obligations in this country, incurred by purchases on war account," and that the American gold pool formed to guarantee foreign gold debts was dissolved on the day of his return.³⁵

Asked on February 16, 1915 about a credit of $100,000,000 for Britain, Davison, who had attended the London conference on the exchange situation, said that nothing of that kind was being done at the moment.³⁶ In February 1915 he was named treasurer of the Mayor's Committee for Relief Work in New York, which asked that contributions be sent to him at 23 Wall Street.³⁷

The French credit and the Anglo-French loan

Vanderlip wrote that "within a week after France and Germany went to war" the French government had sounded Morgan, Harjes & Co. in Paris about a credit of $100,000,000 in New York, and that "Henry P. Davison, quite soon after the war began, had gone to Washington and discussed this proposal with William Jennings Bryan." What came of it was a telegram from Bryan to J. P. Morgan & Co.: "In the judgment of this Government loans by American bankers to any foreign nation which is at war are inconsistent with the true spirit of neutrality."³⁸ Vanderlip reports that the Morgan partners had not been displeased by the ruling, and that after the National City Bank negotiated with the French ambassador, "Harry Davison explained that they felt the City Bank had usurped their position with the French Government."³⁹

In September 1915 the Times reported that the French commission was met at Quarantine by Morgan and Davison, and that Morgan and Davison were among the first visitors received at the Hotel Biltmore by the mission of Lord Reading.⁴⁰⁴¹ On September 28, 1915 the Anglo-French financial commission announced at the Biltmore the completion of a credit for the British and French governments. Davison sat beside Henry Babington Smith, who was described as "one of the four representatives of the British Government," and then read a statement for J. P. Morgan & Co. The loan was $500,000,000 in five-year 5 per cent bonds, offered to the public at 98 and sold through a syndicate. Davison's statement said that the firm "would receive no compensation for its part in the negotiations."⁴² On September 7, 1915 the Times had reported that his son F. Trubee Davison had returned from two months of driving an ambulance in France and been met at the pier by his father on the yacht Shipaki.⁴³

American Red Cross War Council

On May 10, 1917, President Wilson appointed a War Council for the American National Red Cross. Davison wrote in his 1919 history of the organization that "I was asked to take the chairmanship."⁴⁴ The War Council's own report of November 1, 1917 lists its original members: Davison, chairman, of J. P. Morgan & Co.; Charles D. Norton, vice president of the First National Bank; Major Grayson M.-P. Murphy, vice president of the Guaranty Trust Company; Cornelius N. Bliss Jr.; and Edward N. Hurley, formerly chairman of the Federal Trade Commission, with William Howard Taft and Eliot Wadsworth as ex-officio members. Hurley later became chairman of the Shipping Board and was replaced by John D. Ryan of the Anaconda Copper Mining Company.⁴⁵

The first task was a fund. A National War Finance Committee headed by Cleveland H. Dodge was appointed by Wilson, with Davison as vice chairman, Seward Prosser as executive committee chairman and William G. McAdoo as treasurer; its members included Henry Morgenthau, Julius Rosenwald, Frank S. Peabody, Francis L. Higginson Jr., Vance C. McCormick and Joseph P. Tumulty. Wilson proclaimed the week of June 18 to 25, 1917 as Red Cross Week, and the first conference of the War Council was held in Washington on May 24 and 25 with General John J. Pershing, Secretary of War Newton D. Baker and Herbert Hoover among the speakers.⁴⁶ Davison described the campaign: "It was finally and definitely decided that we should fix June 18-25 ... as Red Cross week. From that time on it was like a military campaign." Of the 450 leading men called to Washington he wrote that the conference resulted in "enlisting the services of a group of men with large experience in financial matters and in the raising of funds," and that a New York friend of the Red Cross set the keynote with a gift of a million dollars.⁴⁷

The totals differ inside the book. Davison's narrative gives $115,000,000 for the first drive and "a total subscription of more than $182,000,000" for the second; the appendix gives reported subscriptions of approximately $114,000,000 for the week of June 18 to 25, 1917 and approximately $170,000,000 for the second drive, held May 18 to 25, 1918.⁴⁸⁴⁹ The appendix states that the War Council "went out of existence on February 28th, 1919," that total revenues of National Headquarters and chapters for the twenty months ending that date were $400,178,000 and expenditures $272,676,000.⁴⁹ The foreword to the book says: "I have therefore omitted the mention of names."⁵⁰

General Pershing, asked what the Red Cross could do for him, cabled: "If you want to do something for me for God's sake 'buck up the French.'" Davison wrote that the War Council reached that realization "at its very first meeting."⁵¹ He was in Paris when the armistice was signed and summoned a conference there of the heads of the Red Cross commissions in Europe, according to the War Council's retirement statement of March 1, 1919, which records that Dr. Livingston Farrand became chairman of the Central Committee.⁵² The finding aid states that his wife organized the Nassau County chapter of the Red Cross in 1917 and chaired it for twenty-seven years.¹

League of Red Cross Societies

Davison's 1919 history says that the League of Red Cross Societies "came formally into being in Paris, May 5, 1919," with delegates from the Red Cross organizations of the United States, Great Britain, France, Italy and Japan, "whose representatives constitute the board of governors, of which board I was chosen chairman," and that Sir David Henderson was appointed director-general.⁵³ He tied the League to Article XXV of the Covenant of the League of Nations: "The members of the League agree to encourage and promote the establishment and cooperation of duly authorized, voluntary, national Red Cross organizations having as their purpose the improvement of health, prevention of disease, and mitigation of suffering throughout the world." He added that the relations between the two Leagues would be "of an intimate character" with "no statutory connection," and that the plan had the endorsement of a gathering of medical experts that met at Cannes in April 1919.⁵³⁵⁴

The finding aid gives May 15, 1919 as the League's formation date.¹ The obituary places the step at a conference in Geneva after the declaration of peace, where Davison "was made Chairman of the committee of Red Cross Societies" representing the organizations of the United States, Great Britain, France and Japan. The obituary adds that after the conference Davison urged an immediate loan by the United States government of $600,000,000 to the stricken countries of Central and Eastern Europe, and lists the Foreign Finance Corporation, formed in November 1919, among the postwar agencies in which he took a leading part.²

Honors, directorships and death

The obituary lists directorships at the Bankers Trust Company, the First Security Company, the New York Railway Company and the Guaranty Safe Deposit Company, and a post as treasurer of the National Institute for Social Service. It states that he was made a Commander of the Legion of Honor, "the first American to receive that honor from France," and received a high Belgian decoration from Albert I of Belgium and the rank of Grand Officer of the Crown of Italy from the king of Italy.²

Davison died in May 1922. The obituary reports that he "died today upon the conclusion of an operation upon an infiltrating tumor which could only be partially removed." The annual report of the American Museum of Natural History for 1922 records the date as May 6, 1922, and states that he had been elected to the museum's board on February 7, 1916, and served as its treasurer and chairman of the Finance Committee until his death.²⁵⁵

Peacock Point and the sons

The family estate was at Peacock Point, Locust Valley, New York, on Long Island.⁵⁶ The obituary gives the New York home as Park Avenue and Sixty-ninth Street.² Davison and Mary Kate Trubee had four children: F. Trubee Davison, born February 7, 1896; Henry P. Davison Jr., born April 3, 1898; Alice, born in 1899 and married to Artemus L. Gates in 1922; and Frances, born in 1903 and married to Ward Cheney in 1926.¹ The obituary says that F. Trubee Davison organized a flying corps of young men as the First New York Unit of the Aerial Coast Patrol and was injured in a training accident in June 1917.²

Henry Davison Jr. served in the American Ambulance Corps in France, spent a year at Cambridge University, became a Morgan partner in 1929, was made vice president and director in 1940, senior vice president in 1953 and president in 1955, and died on July 2, 1961.¹ Antony C. Sutton wrote in his 1983 study of Skull and Bones that "whose son H.P. Davison, Jr. was initiated in 1920," and that "some of his partners were" members of the society.⁵⁷ Sutton's index of members by class year lists "Davison, Harry Pomeroy" in the class of 1920.⁵⁸ His chart places the Davison family under J. P. Morgan among the new-wealth families, beside the Rockefeller family and the Payne family under Standard Oil.⁵⁹ In his text Sutton lists "Harriman, Rockefeller, Payne, Davison" among the families that "acquired wealth in the last 100 years, sent their sons to Yale."⁵⁷