Herman Kountze

Herman Kountze is shown here about 1865 when he was president of the First National Bank of Omaha, today the oldest continuously operating bank in Nebraska.

From an Ohio family of 12 siblings, five brothers — Augustus, Herman, Luther, Charles and William Kountze — arguably had more influence on Nebraska banking and Omaha history than any other family.

Their First National Bank of Omaha not only is the oldest continuously operating bank in the state, but it was the 209th national bank chartered in the United States.

In 1855, when the Nebraska Territory and Omaha City were just 1 year old, Augustus Kountze, the eldest of 12 children, briefly visited and bought three 15-acre tracts  in the territory’s capital city. The following spring, 29-year-old Augustus and his 23-year-old brother Herman moved to Omaha and began purchasing an ultimate 160-acre site north of the city.

There, near a mineral water sulfur spring, they established the city of Saratoga, northeast of today’s 16th and Locust streets and named for a New York state resort and spa.

As houses, a sawmill and steamboat landing at Saratoga Bend developed, the brothers built the Central House Hotel, which, though it did not prosper, became Brownell Hall School, which later was moved to Omaha. A portion of the area would become the Douglas County Fairgrounds and the Transmississippi Exposition grounds in 1898.

In the fall of 1857, Augustus established the Bank of Dakota City in Dakota County. Because banks briefly were illegal in the territory, it operated without a charter and unfortunately opened during the Panic of 1857. One of the common practices of such so-called wildcat banks was their issuance of their own currency. Augustus, atypically, never allowed more than $3,000 in his $1, $2 and $5 notes to be in circulation at any time and ultimately proved to be one of only two Nebraska banks to redeem all notes issued.

In 1857, Luther Kountze joined Augustus and Herman, and though the Dakota City bank still was in operation, the brothers were attracted to Omaha,  where they determined they could charge from 5 to 10 percent interest on loans.

That December, the Kountze Brothers Bank was opened next door to Francis Smith’s bank, probably on Farnam between 11th and 12th streets. There is some disagreement on the exact location, but it is generally agreed they soon were at 11th and Douglas until the building was moved to the northwest corner of 12th and Farnam, all within a few months.

During the early months of operation, one of the bank’s major businesses was the purchase of gold dust from miners returning from the West, much of which was stored in tin cans and boxes on shelves along one wall. Despite the seemingly casual storage of gold dust, the bank did have a safe and was considered the most secure in Omaha — to the point that some businesses simply took all their cash and coin to the Kountze Brothers Bank at the close of business every day and redeemed it the following morning.

It was also reported that one of the Kountze brothers and an associate usually slept in the small frame building for added security.

When the Bank of Dakota City was closed in 1860, the safe and furniture were purchased and moved to Omaha, where its outstanding notes continued to be redeemed. Because virtually all the Dakota City currency was bought back, signed notes are extremely scarce and command a large collector’s premium today.

In 1861, Augustus was appointed treasurer of the Nebraska Territory and Herman began acquiring more land north of Omaha, which he developed as Kountze Place, roughly described as Locust to Pratt, 16th to 20th streets. This development was aimed at the upper middle class and had more than 30 homes completed by 1888. The northern portion became the grounds of the Transmississippi Exposition in 1898, then about 1900 developed as Kountze Park with the residential development attracting major homes of the upper class of Omaha, including George Joslyn, William Redick and other prominent businessmen.

Brother William, meantime, had arrived but sadly died within a few months. Luther Kountze left Omaha in 1862 and moved to Denver, where he opened a branch of Kountze Brothers Bank.

In April 1863, Luther managed to save the Denver bank’s records and cash reserves during the great fire that destroyed much of the city’s business district. This enabled the bank not only to survive but to provide loans to local businesses and individuals and aid in the rebuilding of the city. Luther was then elected Denver city treasurer.

In 1868, Luther turned the Denver operation over to brother Charles when he moved to New York City to open yet another branch of the family bank at 52 Wall St. The Denver branch of the Kountze Brothers Bank became Colorado National Bank in 1866.

Meanwhile in Omaha, with the passage of the National Bank Act of 1863, Augustus, Herman and Luther, along with other prominent Omaha businessmen, incorporated the First National Bank of Omaha and received the 209th national charter. In 1865, the old Kountze Brothers Bank merged with First National, giving the brothers 38 percent ownership interest in the new bank.

In the 1870s, the Kountze brothers partnered with several other Omaha businessmen to form a corporation that built the Grand Central Hotel, but before it was completed, Augustus left to join Luther in New York City. In 1874, Herman Kountze was elected president of First National Bank of Omaha, a post he would hold until his death in November  1906.

J.A. Creighton held the presidency for less than three months when the position was awarded to Charles T. Kountze, son of Charles B. Kountze of Colorado. When Charles T. retired in 1914, the Kountze control of the bank left the family, with only William never to have held an office there.

The Kountze family, once said to be one of the largest property owners in Omaha, leaves a large legacy as bankers; vast real estate owners in Texas, Illinois, Minnesota, Colorado, Nebraska, Wyoming and Iowa; The Union Pacific Railroad; Sabine & East Texas Railroad; and political offices. The name lives on as an Omaha street, the Kountze Memorial Lutheran Church, Kountze Park and Kountze, Texas, the county seat of Hardin County.

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Historian Jim McKee, who still writes with a fountain pen, invites comments or questions. Write to him in care of the Journal Star or at jim@leebooksellers.com.


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