History of FNB Financial

FNB History

The National Currency Act of 1863 and the National Banking Act of 1864, proposed by President Abraham Lincoln and approved by Congress, provided for a sound and dependable currency and a strong system of national banks. At the same time, the community of Three Rivers, MI, like many other towns and cities in the Midwest, was experiencing rapid growth in population. In response to the need for the financial services requested by a growing community, and authorized through President Lincoln’s national banking legislation, The First National Bank of Three Rivers was organized on October 8, 1864 by local businessmen. The original capital pledged by these men was $50,000. On December 3, 1864, a charter was issued to The First National Bank of Three Rivers by the first Comptroller of Currency of the United States, appointed by President Lincoln, Mr. Hugh McCulloch.

In 1872, The Manufacturer’s National Bank of Three Rivers was established. Another national bank, The Three Rivers National Bank was established in 1885. The Manufacturer’s National Bank of Three Rivers was prompted merged into the new bank. Then, in 1897, the combined banking entity was absorbed by The First National Bank of Three Rivers, leaving just one national bank in Three Rivers.

The first president of the bank was Edward S. Moore, and the first cashier was Charles Warren. Mr. Warren was paid an annual salary of $1,000. Since records do not indicate any salary for E. S. Moore, it is assumed that he was not a working officer of the bank, but functioned more on a policy making level with the Board of Directors. In the absence of the cashier, Joseph Prutzman, who was appointed teller, was to be paid on a daily basis for any services rendered.

The first location of the bank was on the east side of Main Street in leased facilities. In 1871 the Board of Directors authorized the construction of a permanent bank building "on the plan of the Marshall Bank". The building was located at 66 North Main Street. An engraving of this Victorian styled building was used on drafts of this bank for many years, starting in the 1870’s. Over the years, the original bank building was remodeled and expanded. In 1914 the interior of the building was remodeled, with minor exterior changes. Then, in 1938 the interior was completely remodeled and a new “modern” slate façade was added to the structure. In 1958, the bank building was expanded through the purchase of the old "Hotel De Hamburg", which was adjacent to the original structure.

In 1962 the downtown drive-in facility was opened, with three windows. In 1963, when the bank listed assets of $12 million and had a staff of 27 employees, Donald Smallcombe succeeded Raymond Linsley as president. His first major move was to expand the drive-in facility to four units.

By 1968 a new bank facility was being planned to keep up with the growth and increased responsibilities of The First National Bank of Three Rivers. The site selected was the aging Three Rivers Hotel at the southwest corner of Main and Moore Streets. In 1970 the bank purchased the hotel and the home behind it and began preparing the future site. Two months into the project, a disastrous fire completely destroyed the original bank building. The operation of the bank continued from temporary quarters located near the downtown drive-in facility. On January 4, 1971, with assets of $20 million, the bank moved into the new quarters.

By 1972, the volume of checks and other transactions handled by this bank had reached the point where it became imperative that a faster, more economical means of processing our work be found. Together with two other area banks, Information Technology Services or "ITS" as it was most commonly known, was founded. This data center operated from a Sturgis location, serving The First National Bank of Three Rivers and a number of other banks in South Central Michigan and Northern Indiana. The center brought the bank into the era of computers and made it possible to compete in terms of modern services.

In 1972, the bank was granted trust powers and, in 1973, opened the area’s first trust department.

With the computer age in banking came 24-hour automated teller services and in June of 1977, The First National Bank of Three Rivers introduced the first fully automated 24-hour teller machine in St. Joseph County.

By 1978 it became apparent that the needs of our customers called for further expansion of drive-in facilities. The Westland branch office and North Main branch office were built in 1979, with North Main opening in 1979 and Westland opening in 1980. Each office was equipped with a 24-hour teller machine.

By 1984 computer technology had reached a state whereby it was economically practical for an independent bank to operate in-house with its own computer system. Information Technology Services was closed, and the bank purchased its own computer hardware and a software system.

In December 1985, Donald Smallcombe retired after 47 years of service to the bank including 23 years as president. During those 47 years our bank grew from a tiny country bank with just over $1 million in assets into a modern, full service financial institution. Richard M. Bell was named President and Chief Executive Officer in September, 1985.

Expansion became a key part of the bank’s strategic plan in the 1990’s. In January, 1991 a branch in Constantine was opened. The Constantine expansion was the bank’s first physical move outside of the city of Three Rivers. The pattern continued with the acquisition of an office in Mendon in November, 1994 and the opening of a branch in Centreville in May, 1998.

In March 1996, our Board of Directors and shareholders approved a corporate reorganization. A one bank holding company, FNB Financial Corporation, was formed to become the sole owner of The First National Bank of Three Rivers. Former bank shareholders were granted shares in the new one bank holding company. The bank holding company structure allowed the bank to provide more services, to more easily obtain capital, and to make a more liquid market for its stock.

Technology became the focus of the latter part of the 1990’s as the bank entered into the world of networked computers, voice mail, E-mail, and the Internet. The bank’s first automated voice response telephone system was introduced in 1999.

During 2000, Richard Bell retired from the organization. After a brief interim period, Richard E. Dyer was hired by the Board of Directors as President & Chief Executive Officer of FNB Financial Corporation and First National Bank of Three Rivers.

In 2001, the organization “reinvented” itself with a new bold logo and look.
Products and services were expanded significantly during the period from 2001 to 2003, including the expansion of the trust and financial services departments into full financial service organizations, offering stocks, bonds and mutual funds to trust and non-trust clients. Expanded mortgage products, tiered interest rate deposit and loan products, enhanced commercial lending products and activities, imaged checks and various insurance products were also introduced.

In 2003, the downtown drive-in facility, after serving the Three Rivers area for 40 years, was closed and demolished due to the deteriorating physical condition of the facility and the shift of clients from drive-in locations to telephone, Internet and ATM usage.

First National Bank of Three Rivers celebrated its 140th anniversary in 2004 with many community-wide events and activities, including the introduction of an annual “Voices of Leadership Address”. At the first annual address, legendary University of Michigan football coach Glenn “Bo” Schembechler served as the keynote speaker. The bank also celebrated 140 years by introducing Internet banking and electronic bill pay.

In 2004, First National Bank expanded outside of St. Joseph County for the first time in the long history of the organization. A loan production office was opened in Niles, MI, just north of the main downtown business district. That opening was followed by the opening of a second loan production office in downtown Dowagiac, MI. The Dowagiac office opened in 2005.

A full-service branch location was opened in Cassopolis late in the year 2005. First National Bank partnered with Midwest Energy Cooperative to convert an existing drive-up payment window for the utility company into a full-service drive-up teller window. First National Bank also worked with Midwest Energy to convert a conference room into a private banking office and establish a lobby presence through the establishment of a teller window at the energy coop’s main reception counter.

The bank’s trust department and investment/brokerage operation were combined in 2005 to form FNB Financial Services Group. The combined financial group moved into the bank’s renovated North Main Street facility in Three Rivers, MI where it offers the full gamut of non-traditional financial products and services. The North Main facility also continues to house both lobby and drive-in teller services.

The history of the organization is long and impressive. The organization has been a leader in the community since the days of President Abraham Lincoln, and continues to take its leadership role very seriously. As with the past, the future of the organization promises to be exciting and successful.