What Happened to the First National Bank of Toms River?
Toms River–The First National Bank of Toms River, founded on March 3, 1881, grew to 58 offices countywide during its peak. The bank was the hometown bank of many Ocean County residents. In May of 1991, the bank was acquired by First Fidelity after its financial meltdown. More on that later.
At the time of the purchase on May 22, 1991, the bank held $1.6 billion in assets and maintained 259,100 accounts.
In January of 1994, First Fidelity merged into First Union. First Union was then acquired by Wachovia in August of 2003. Wachovia was then acquired by Wells Fargo in December of 2008.
The bank’s original main branch location was in a building on main street on the Toms River, next to the bridge until moving to their modern headquarters located at 975 Hooper Avenue, the current home of Ocean First Bank.
So what happened to the First National Bank of Toms River?
The first public sign of troubles came from loans made during the 1980′s construction boom in Ocean County. In the 1990′s and as the bank began to fail, bank executives tried hard to conceal their problems to customers. The bank was in dire financial trouble, but once news broke out, despite being covered by FDIC for accounts up to $100,000, investors began pulling out of the bank, compounding the problem. Debtors were unable to repay loans.
Then, attention turned to Larry Bathgate, a development attorney, when he was called upon to pay a $16,000,000 loan from the bank. When Bathgate, who was heavily involved in the time with high-stakes political fundraising was unable to pay the loans, the bank went after his two homes and a Rolls Royce. In the media, Bathgate was made the scapegoat of the bank’s collapse. Bathgate was sued by the bank after he failed to meet an April 11, 1991 payment deadline demanded by the bank.
Bathgate had borrowed over $19,000,000 from the bank between 1986 and 1990.
On May 25th, the bank filed for bankruptcy protection. Federal regulators had declared the bank insolvent after a loss of $165.8 million dollars in 1990. 5,000 shareholders in the bank, holding 9.6 million shares lost their holdings in the company. The bank that served the community for 110 years was now gone. First National Bank of Toms River was a victim of the Savings and Loan Crisis. It was ranked 19th during the crisis in size, according to book value of assets at $1.36 billion dollars.
After announcing the sale to First Fidelity Bancorp, the bank was immediately rebranded at all 58 offices under the new name.
By August of 1991, downsizing came. 14 branches were closed by September.
First National Bank of Toms River: Big enough to be close to you. Small enough to be friendly.