In the early 1900’s before Grapeland had a bank, some of the general merchants took care of the monies of their friends and customers. They carried a deposit ledger and allowed these people to put money in and draw it out at their will.

In 1907, on January 22, seeing the need for a bank, charter was applied in the name of The Farmers and Merchants State Bank, Grapeland, Texas. This charter was signed and sealed on January 31, 1907, by L.T. Dashiell, Secretary of State and the number given to the bank was 183.

The original stockholders who joined together to form this bank were; George E. Darsey Sr., W.G. Darsey Sr., J.J. Brooks, Mrs. H.J. Cunyuns, Joe Adams, Starley Boykin, R.E. Galson, P.H. Blalock, S.E. Miller, George Shipper, T.S. Kent, W.F. Murchison, M.P. Herod, A.W. Cain, Miss Freddie and Luke Garrison, H.J. Ivey, Dr. F.C. Woodard, J.H. Beazley and Arck Baker. 

The capital stock of the bank in 1907 consisted of $15,000, no surplus and no undivided profit accounts.

The present capital structures is $75,000 capital stock, $100,000 surplus, $50,000 reserve, $12,252.71 undivided profits, $2,383,864.71 deposits, $12,000 unearned interest and other reserves $7,719.40.

The original officers of the bank were George E. Darsey, President, J.J. Brooks, Vice President, Sam E. Miller, Cashier, W.D. Granberry succeeded Miller as cashier in 1910.

George E. Darsey Sr. served as president of the bank until his death in 1930, at which time T.S. Kent, then Vice President was elected honorary president and W.D. Granberry was elected active vice president. Leon Anderson was elected cashier. T.S. Kent served was president until his death in 1938. M.E. Darsey Sr. was elected president and succeeded by Mary Lou Anderson. George E. Darsey Jr. became president in 1957 and was followed by Frank Granberry in July 1962. In July 1966 M.E. Darsey Jr. became president in 1957 and Jeff Austin, Jr. was elected Chairman of the board of directors. The name of the Farmers and Merchants State Bank was changed to First State Bank in 1967.

Leon Anderson served the bank as active vice president for 28 years. 

A new drive-in bank building was constructed four years later. Walter Cook has served as president since 1970.

In 1973, Jeff Austin sold his interest in the bank to Mike Vaughn and Associates of Waco. Mr. Vaughn served as chairman of the board for the following year. At this time, a group of local businessmen purchased the interest of Vaughn and Associates in order to bring the controlling interest in the bank back into local hands. 

The building was expanded in 1986 to include a community and directors room, a kitchen, and storage areas. A parking lot was also built behind the bank.

The First State Bank has steadily grown through the years until the total assets now stand at $16,525,000 with a total capital of $1,600,000. The present board of directors is made of Walter Cook (chairman), George Bartee, Harvey Huff, J.A. Wilkins, Dan Walling, Charley Darsey, and Chester Cunningham.