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New Bank to Get Assets of The Mercantile Bank of Central and South America Incorporated at Hartford With Capital of Five Million Dollars To Drop Trading Firms Control Will Be Divided Among Various Financial Institutions of Country Incorporation at Hartford, Gonn., of the Bank of Central and South America, with a capital of $5,000,000, brings to the point of final adjustment the affairs of the Mercantile Bank of the Americas, whose snarled condition a year ago caused the most severe crisis of the deflation period in the financial district. The new bank. whose capitalization is divided into 50,000 shares of $100 par value, will, it was learned last night, take over the assets and business of the Mercantile Bank, which has been under liquidation for more than a year. The branches in South and Central America which can be carried on at a profit will be continued when the affairs of the Mercantile Bank are wound up, but the trading companies associated with the enterprise will not be acquired. Little information regarding the project was available last night, but Edward R. Stettinius, of J. P. Morgan & Co., indicated that he would be prepared to divulge full details to-day. Mr. Stettinius has been probably the most active member of the committee named to administer the Mercantile Bank's affairs, the committee including also Gates W. McGarrah, chairman of the Mechanics and Metals National Bank; William C. Potter, president of the Guaranty Trust Company; Walter E. Frew, president of the Corn Exchange Bank, and Willard V. King, president of the Columbia Trust Company. Ownership Divided The understanding is that ownership and control of the new bank will be divided among various banking institutions. and houses much as was that of the Mercantile Bank of the Americas. In that institution, the Guaranty Trust Company, Brown Brothers & Co., and J. & W. Seligman & Co., were the largest stockholders while other banks all over the country were jointly interested. The Board of Directors and personnel of the new bank is expected to be determined by the committee which has liquidated the Mercantile Bank's affairs. The Mercantile Bank "situation" first began to assume threatening proportions following the collapse late in 1920, of the price of sugar, cocoa and other commodities in which it was interested. The bank was engaged in financing South and Central American commodities from the soil up and depended for repayment of loans upon the sale of these commodities. When the bottom of the market fell out, additional money was called for to enable the financing of a new crop, what occurred being virtually a pyramiding process in the expectation that prices would recover. Called Upon Stockholders First official intimation of the development of a crisis was given when early in 1921 a call was made upon stockholders to contribute additional capital, and an acceptance credit was established in which a great majority of the banking institutions and houses in the Street participated. This attempt to meet the problem proved unsuccessful and late in July, a year ago, the situation became so acute that J. P. Morgan postponed his annual holiday trip to Europe and a further credit was provided. Since the Morgan firm definitely took charge, little information has been forthcoming on progress of the bank's affairs. It has been known that the commodities held by the bank were being gradually disposed of and that associated banks and trading companies were being liquidated or nut on a sound basis. No exact estimate of the losses that have been taken is available, but they are known to run into millions.