First Arkansas Valley Bank

The First Arkansas Valley Bank, located in the Business District of Old Cowtown Museum, represents the financial institutions which serviced the expanding economy in Wichita during the 1870s. The evolution of the First Arkansas Valley Bank is typical of many early banks in the Midwest. William Woodman moved to Wichita from Illinois in 1870. An experienced merchant, he opened a general store, and as was customary sold things on credit to many in the area, especially the farmers. As his transactions and wealth increased he created a bank that issued the first mortgage in the county. He continued in the banking business until his death.

Banks were a necessary part of town building. For cities and farmers they provided the necessary capital for growth and expansion. Unfortunately they became a driving part of the Wichita / Sedgwick County schism. As mechanized farming had increased since before the civil war, farming required a large amount of money to buy land, machinery and expand over time. Farming was fraught was challenges in the new country, from inconsistent weather, drought or flood, locust infestation and just learning what would grow in this formerly called “Great American Desert.” Farmers often felt they were charged extreme interest compared to their city citizens. With only one railroad they also felt hostage to the shipping fees that were charged to move their produce. These two complaints were of the greatest factors that gave rise to the farmer’s political organization, The Grange, which was active in local, state and national politics for many years.

Wichita was founded on Osage Trust Land and the land was held and sold for the benefit of the Native Nation the Osages for $1.25/ acre. This land was not avialble for the terms of the homestead act – 160 acres free if lived on for 5 years.

Most farmers had to borrow money to purchase their land. The settler on Osage lands had one year from the filling date to pay in full. A farmer in search of a longer term of payment was forced to mortgage his property to a Wichita banker at ruinous rates. An area farmer during the period complained that the objectives of congressional land laws must be "to give the land grabber a chance to buy cheap land with improvements already made or money lenders a chance to loan at rates that would double in eighteen months."

The land mortgage system seemed especially unsound and unfair to the farmer who compared the borrowing power of a cattle broker in Wichita. Local farmers complained bitterly at paying annual mortgage interest rates of 30-60% while nonresident cattle men received loan rates as low as 4%.

The general assumption by farmers during the period was that anyone connected with the booming cattle‑trailing industry that followed the cattle town promoter and entrepreneur Joseph G. McCoy, was sufficient collateral for speculation in the cattle trade. The commitment to the frontier farmer who was often viewed with tepid interest by the typical cattle town businessman. Rural residents during the cattle trade era in cattle towns like Wichita were considered a subsidiary clientele, albeit an important one.