Click image to open full size in new tab
Article Text
VICTIMS OF UGLY RUMOR
GOSSIP STARTS RUNS, AND TWO STANBERRY, MO., BANKS CLOSE.
When One Institution Fails to Open Panie Results, and Another Financial House Suspends Operation.
(By Staff Correspondent.) STANBERRY, Mo., Jan. 16.-Their doors closed and windows darkened, two banks here illustrate foreibly the damaging effect of ugly rumors. The rumors directed against one of the banks have been alarming bankers here the last six-months. Then came the coup of the gossipers-and in one week two banks suspended operations. Residents had expected the Gentry County Trust Company to close its doors for some time, it was learned to day. but in spite of their expectations they were greatly surprised Monday morning when they noticed the curtains of the bank down at the usual opening hour and a sign on the door announcing the bank had been closed. An immediate panic resulted. and the depositors of the Farmers and Mechanics Bank made run on that bank for their deposits. When the bank closed Tuesday night upward of $25,000 had been withdrav according to W. E. Teel, president of the bank.
ONLY ONE COURSE. "The run was so great," Mr. Teel said, "there remained only one thing to do. and that was to close our doors. called a meeting of the board of directors early yesterday morning and notified R. E. Shelby of Albany, a state bank examiner, who was going over the books at the closed Gentry County Trust Company. Mr. Shelby made a hurried inspection of our resources and liabilities and found everything in good order." Do as you feel about it." Mr. Teel quoted Mr. Shelby as saying. "The board decided to close the bank," Mr. Teel, an elderly, gray-haired man, said. The city's third bank. the Commercial Bank, is reported to be not affected. L. E. Miller, cashier of the Commercial Bank, said no run had been made on the Commercial and none was expected. Stanberry is in Gentry County, in the northwestern part of the state. The city has population of about twentyfive hundred. The merchants and banks suffered business setback last year because of the poor crops. Heavy rainfalls in the spring washed out the corn, and corn is one of the chief products. The rumors on the streets of the city regarding the insecurity of the town's banks have died out now. The people are rather reluctant to talk, the bank ers refrain from making statements. and the townspeople hope everything will be worked out satisfactorily. Even the bankers have not given up hope en tirely, and indicate there is a possibility of the banks reopening. But even if the banks failed to open, the bankers explained, the depositors would not lose one cent.
TELLS OF RUMOR.
C. A Greenlee. secretary treasurer and one of the most active organizers of the Gentry County Trust Company in November. 1919, was free with his discussion of his bank. "Several months ago," he said, "I went to St. Joseph for the bankers' convention. was gone only day. Even in that short time the rumor became general about town that my bank was on the rocks and had skipped out. That's just one of the examples, Mr. Greenlee said patrons of the bank started to withdraw their deposits about six months ago. withdrawals continued to grow." he declared. "and the indications were that every cent would have been drawn out.
"We were simply forced to close." Mr. Shelby, the examiner. said he had found no irregularities in the affairs of the bank. Claude Stout of Savannah, another state bank examiner. and Walton T. Todd. chief deputy commissioner, joined Shelby here last night. Mr. Teel, president of the Farmers and Mechanics Bank, declared his bank was closed as the result of the failure of the Gentry County Trust Company A SPIRIT OF ILL FEELING.
Mr. Teel gave, perhaps. the most plausible reason for the failure of one of his competitors. He said Greenlee, secretary treasurer of the Gentry County Trust Company, formerly was an officer of the Farmers and Mechanics Bank A misunderstanding arose between the two with the result that Mr. Greenlee resigned November 11, 1919 He immediately organized the trust company. Others declared that since the organization of the trust company, "a sort of illegitimate offspring. as it were, of the Farmers Bank spirit of III feeling was maintained between the two institutions which finally resulted in the downfall of both. Mr. Greenlee admitted having had grievance with his former employer. Mr. Teel. had no intention of organizing bank until had left the employ of the Farmers Bank he said. "I was on my way to look for a new job," he continued, "the day after had resigned and met Will Temple. Will and talked the situation over and decided to start new bank. Before night that same day we had raised $75,000 and easily could have raised $100,000. "George Morton and W. S Harden, then both directors of the Farmers and Mechanics Bank, left that institution and helped me organize the new bank. Most of the other big stockholders were former depositors of the Commercial Bank. E. Holding. who is now living at 2507 East Twenty-eighth street, Kansas City, and is a former vice-president of the Farmers and Mechanics Bank, also joined us in the enterprise and became stockholder.' STATEMENT SHOWS DEPOSIT LOSS. An official statement of the financial condition of the Farmers and Mechanics Bank, issued June 30, 1924, shows that the total deposits at that time were $222,863 45 The total resources were $334,727 A second report of the bank's condition, issued December 31, 1924, gives the total deposits at $200,017.62, or almost $20,000 less than the report of seven months before. This would indicate that the Farmers Bank suffered much greater withdrawals than its rival, the Gentry County Trust Company and in addition to the above $20, 000 must be added the $25,000 withdrawn the first two days this week The Farmers and Mechanics Bank was the oldest bank in Stanberry It was organized in 1885. Bert Moore, cashier. man in his early seventies, had been identified with the institution almost forty years. The question naturally arises: What became of the money that was with. drawn from the two banks that failed? No one in Stanberry appears to know.
The open door to opportunity- Star Want Ads. Read them every day.
