1093101590 109310
national
4698b5b8b459c5a9Accommodated withdrawals, Public signal of financial health, Capital injected, Books examined
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THREE CALIFORNIA BANKS CLOSE AFTER HEAVY RUNS SAN BERNARDINO, Cal.-The doors of three banks were closed today following heavy withdrawals, assertedly as the result of malicious rumors regarding their solvency. A run started on a fourth bank, the American National, jafter the San Bernardino National,*the County Savings Bank and the First Bank of Highland, six miles from here, were closed.
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San Bernardino Banks Closed SAN BERNARDINO, June 18. (U.P.)-The doors of three banks were closed today following heavy withdrawals by depositors, assertedly as the result of malicious rumors regarding their solvency. A run started on a fourth bank, the American National bank, after the San Bernardino National, the County Savings bank and the First Bank of Highland, six miles from here, were closed. Officers of the American National said they would remain open and pay all depositors. Superintendent of Banks Edward Rainey announced that the County Savings bank would probably open within a few days and the San Bernardino National soon after Police had been investigating a "whispering campaign" for several days, since bank officers reported rumors had been circulated by telephone, frightening depositors. WASHINGTON, June 18. (U.P.)The comptroller of the currency's office today said that M. V. Stendrup, national bank examiner, win handle affairs of the San Bernardino, Calif., National Bank until a receiver is appointed. Officials said it was better for the bank to close its doors and liquidate, than to continue operations and run itself into a worse condition. Deposits on the date of closing were listed by the examiner at $1,100,000 and total resources on February 1, 1932, at $2,096,168.
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OPEN FALSE Gilbert Instructed to Select 'Vigilantes' Group to End Destructive Tactics (Continued from Page Eleven) perienced Friday and for more than an hour yesterday because the secondary reserves ed, has the hand deposit other banks. added that the Federal bank examiner had check on the bank on May and pronounced solvent. detailed the of national bank, explaining the depositors safeguarded by He reassured the audience that the bank solvent and continue but made for the loyalty cooperation which, he declared, should given all business houses. pointed out, "go broke" when the depositors want their money all the same Mr. Hellyer declared that the timidity people rush the banks and make not only the banks but the people themselves. He talked viewing the he views he was interrupted Grant prominent attorney, told the the day enlist for the banks, declaring obtained more than $30,000 deposits for the American National bank. He, too, urged support for financial houses and hysteria be driven by acts and expressions confidence. Mr. Cowen said that he learned his San Diego from fishing Friday that the San National bank, where he had business for seven years, closed doors. Oakley Avers Run Broken uncertain to what would do, course," not discouraged. When saw that line in front of the American bank, said, 'right bank me just need and gave my busimade deposit there terday and shall make one Monday, the next day and every day have faith San Bernardino. had but little came years and made money down. I'll go down with But your cooperation and faith won't go down." Edward Coulter, secretary of the United Travelers, declared that deposit in American National bank and that his organization would permit, for moment, the of any funds from the bank this time. M. Oakey, an executive of the Bank declared the the banks was definitely broken felt o'clock this he said, "that had passed the crisis licked the wave which gripped the people You go that this thing (the run the banks) over." Veterans Touch Funds R. H. prominent busiand the Amreported that Friday went to Walter M. Steele, the service that withdraw gion funds from the American Nabank Steele with the and was unanithat of be that addition the legion lend its full support to the Mr. Stockwell with to Mayor Gilbert that he have the sponsored by Mr. Cowen wait Commander Steele and the name of the person the suggestion. An of the scope by the was by Thomas R. executive the council of San Berthat the men the city stand man the leaders in the community's financial houses. do within our power to help this emersaid Mr. Conova. alize that situation as now stands will be made by many times this hysteria not alize that can only obtained through the of normal business We would be ashamed ourselves and our mothwould ashamed of us did not for the the people here.' In closing the meeting. Mayor Gilbert thanked the huge crowd for its help and expressed the belief there sufficient faith in San Bernardino banking institutions to carry the through. bank just strong its depositors," Mayor Gilbert, immediately get back sound footing."
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Banks' Business Back to Normal; Expressions of Confidence End Hysteria San Bernardino's banking restored to normalcy yesterday. The hysteria which precipitated runs the Bank America the American National bank last week before expressions confidence business terests bank depositors the financial When the banks opened their doors yesterday, there crowds there had been the ordinary number of clients the banks, many of them there open time during the day was there indication of the return the hysteria. Banks Get Many New Depositors At both the American National and the Bank the one the gest days their history from the standpoint opening new counts. McCook, the American National said that there more accounts opened his bank than during any previous since the bank established nearly years ago. Virtually possibility of the currence the banks, which faded before noon on Saturday, eliminated Saturday night when business men met the American Legion hall to war against circulators false reports, such forced the closing San Bernardino National bank The meeting instructed Mayor Gilbert name committee cooperating with district attorney effecting the arrest of malicious gossipers. The committee, which Mayor Gilbert named Monday, will serve mayor believing that more effective work accomplished by business men working quietly without their identity of the committee being publicly known. With again restored, the San Bernardino grand jury will take its investigation of the communistic plot by which the San Bernardino National bank tacked, announced by District Attorney Stanley Mussell. Strict Secrecy Will Mark Probe Among the more of nesses to testify the jury's inquiry will be depositors made withdrawals of funds from the bank after calls telling them that the bank unsound. The depositors will asked to the inquisitors why they made particularly if they acted after being and whom, the district attorney said. Strict secrecy will mark the investigation and the inquiry will be rected along lines which the prosecutor believes will the Identity least few of the circulators of the false reports concerning the soundness of the bank. extremely serious said Mr. Mussell, investigation will prosecuted from angle. We shall invite every anyone who has information against the bank to testify before the grand
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SEVENTEEN STATES CHECK RUNS ON BANK Seven More Join Movement to Restrict Withdrawals of Deposited Moneys THREE AND FOUR DAYS TO BE TEMPORARY HOLIDAYS Situation Easing in Some States as Legislatures Planned Curb Laws Mississippi, Arizona, Nevada and in Oregon today joined the states. which there are limitations placed on the withdrawals of deposits from banks. in which limitations on withdrawals now exist. The proclamation of Gov. Ralph at San Francisco makes mandatory the closing of California banks (or three-day period ending Saturday The three-day holiday called Gov. Murray in Oklahoma for same period also is mandatory. The of Gov. Allen of Louisiana provides for the sation until the end of the week "all public business including Banks and other public enterprises." Mississippi the decree of state banking called only (Continued On Page Two)
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BANK CLOSING'S EFFECTS Thousands of theories are being voiced as to the causes and effects of the closing Thursday morning of all of the banks in California. Wise men who stand high in the financial world differ in their opinions on these two angles of the great crisis, so one guess is just about as good as another. But the fact remains that the three-days' holiday of closed banks will surely prevent any "run" on the banks which might come at this time. And "run" on bank is the worst thing that can happen, financially, to any community. It means, if carried far enough, that the bank must close permanently, and that means loss to the depositors as whole and the men who stand back of the bank stockholders. By the time the banks re-open next Monday it is thought the frenzy of withdrawal will have been overcome either in the minds of the people or through legislation making it compulsory. Other states that have declared similar banking holidays are now re-opening their banks with satisfactory results and business resumed in the normal channels. Let us have faith that this will be the outcome in California. Meanwhile, efforts to continue trade and business activity as usu will be made in Escondido. with an exchange worked out on confidence in the integrity of the merchants, business men and all citizens whose promises to pay are regarded as "good." So the whole thing sifts down to the matter of confidence, which is really the ultimate need and necessity of the situation, all the way from Escondido to New York, or even to Washington.
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California Bank Extended Holiday Until Thursday Few Institutions Expected to Open Tuesday Morning SAN FRANCISCO, March Federal Reserve Bank of San Francisco closed today for the duration of California's banking holiday. Rolph tonight proclaimed an extension of the Callfornia bank holiday until Thursday, March The new three-day period will begin Monday with general holiday similar to the one now in effect. the governor said. The holiday Tuesday and Wednesday will be effective under terms of the special holiday bill passd today by the legislature. Provisions of the bill affect only banks and permit them to open or remain closed, it was explained. The action was taken by the governor after the assembly had approved the special holiday bill by vote of 54 or by exactly the required two-thirds vote. The senate passed the measure with only one opposition vote. The holiday extension will be fective for the three-day period re. gardless of what action is taken on specific bank bill now before the legislature, the governor said. Action on this measure was delayed until Monday. SAN FRANCISCO, March officials were bit puzzled tonight as they tried to determine course of action to follow Tuesday, when "special holiday," proclaimed by Governor Rolph, becomes effective. Under bill passed by the state legislature late today, the governor was permitted to proclaim special as well as general holidays. The banking moratorium was extended until March with the understanding that Monday would be general and Tuesday and Wednesay a cial holiday On special holiday banks may close or be opened as their officers desire. It was believed some banks would open Tuesday and Wednesday while most of them would remain closed until the legislature approves bill permitting restriction of withOfficials of the Bank of America discussed the situation tonight but said they probably would not reach decision or have an announcement to make until Monday. Wells Fargo Bank and Trust Company officials were understood to be desirous of opening Directors of other banks preferred to follow along with the majority and wait for some protective legislation.
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Clearing House Scrip Plan Starting Friday Approved Continued from page in this situation was "no meeting surprise other country would have taken the situation calmly said. manner people has and to the out the has been lant New Regulation Waited The reopening made banks many states hastened take vantage At the treasury, the White House and on Capitol Hill participated in by RooseSecretary Woodin etal forward the fort to bring an orderly passage the muddled economic situation In some quarters. another bank Ing regulation was expected which would permit with draw one-third their deposits Roosevelt Thanks Hoover President Roosevelt today gland hurriedly through an tion mail telegrams before of again devoting his attention to the banking crisis. chief executive remained the White House the ing and the Early, of Mr. Roosevelt's was done the President's convenience. Through Early. the chief expressed his the issuance by former President Hoover in New of statement urging co-operation for Mr. Roosevelt's policy in the bank. ing emergency. Roosevelt planned today begin drafting his message the special session of congress which meets day after tomorrow though he already formulated the outlines of the proposals will the White House had had time to work on the itself and intended considerable portion the day to Bans Currency Withdrawals The regulation issued "Any institution lawful engaged in serving registrar of stocks or bonds. transfer agent. guardian estate signee. receiver. committee of in any other fiduciary capacity. may transact such business the mal and usual manner: provided that in the said busi except may permitted by other regulations of the secretary, such banking institution shall not pay out or the withdrawal coin withdraw any trust fiduciary funds deposit any other department the bank quiries, it was said at the treasury regulations issued by Secre Woodin are being communicat ed through federal reserve order permitting the use of cash food being interpreted by bankers in the west permitting them furnish funds for market which are to be used for bank closed by both state federal would about easing the situation under the new treasury would depend upon their state regulations. OHIO BANKS UNDER March The majority Ohio's 800 banks opened today almost the Identical regulations placed them week ago. In largest than under state law permitted banks on old deposits cent Febru27 balances, stipulated that new deposits must held subject on mand without restriction or limita few Ohio banks which placed last and did not segrenew were forbidden pay out money though received new deposits for BANKS REOPEN ON RESTRICTED Koeneke, Kansa. state bank authorized the im. mediate reopening of state banks for business on restricted basis outlined by Secretary of the Treasury Woodin. Deposits made the banks Saturday may returned the depositors in full Koeneke the banks but per cent deposits books previous March may not withdrawn. CALIFORNIA MOVES TO RESUME BANKING San March Far and state today such as permitted issue scrip generally conform with national provisions. Clearing house certifictes ready printed in Seattle and Los Angeles, from eujation pending receipt detailed rules from the secretary of the Gold reported appearing trade channels. Bankers said hoarders apparently were being forced by currency turn loose the yellow coins. FLORIDA TO RESUME RESTRICTED BANKING March Banks Miami Tampa planned to reopen treasury department restrictions today make change and carry other limited functions while state conferred the Florida ing situation. Circuit Judge Frank Birdseye View of Banking Situation Over the Country Associated State after state announced the of today in line with ruling Secretary the treasury permitting the transaction of essential business. Each institution may "meet the needs Its community for other necessities life. for the relief of distress, for usual salarles' and for other similar enbe made, currency may be changed, but gold gold certificates shall paid out. States which had given their governors regulate Included York and The New York executive net up corporation for the issustatewide Scrip manufacturers said they had little to fear from counterfeiters because an design they are employing. Chicago's medium will pic. ture Abraham Lincoln: New York's will Its coat arms, and Philadelphia's boast likeness of Benjamin Smith signed an order providing on fore closure sales in Orange and Osceresult of the banking situation. QUICK RETURN NORMAL BANKING SOUGHT New March certed efforts to transfuse enough life into nation's money teries to finance ordinary breadbusiness hastened the day America' mobanking holiday And nation which had develhighly organized and efficient system of settling per cent business with checks found that. the highcomplex procedure was not easTrue, bankers pointed out, scrip clearing certificates have in this country before. In the banking groups quickly ganized and the supplemenmedium exchange But to with much more of the country's conducted on national scope, many executives feel banking must be restored quickly national basis. Most the leading corporations the today do business almost every Therefore, form emergency used City, must be so drawn by furniture Grand Rapids, unless the manufacturer is prepared extend almost credit distributors Kansas City and points. the banking problem being dealt far Individual ies states on separate schemes, while Washington authorities are trying to piece them together. Governor Lehman has worked out statewide plan for New York the New York has New city plan which may plan. the Governor Lehman explained his state plan might absorbed by national What banking authorities particularly anxious avoid foreign exchange market in the commanding would make business costly and uncertain. CHICAGO'S LARGEST BANK OPENS: OTHERS TO FOLLOW Chicago March Chicago's National Bank and Trust Company, opened to operate authorized by the the treasury. some other banks they would do later The other banks their decision because the belief the restrictions conflicted the Illinois holiday declared by Governor Henry Horner Layburn bank examiner announced after telephonall national banks should obey the orders and disregard state bank orders. HOARDS REPORTED March New York banks today hardships among their millions of depositors Immediately upon receipt of Secretary mitting reopening accounts funds cient to and food needs they were open for such busi- Hoarded gold is being deposited Irving Trust Company announced shortly But the from Woodin meant technical difficulties for the banks means one banker said, "that some responsible officer each branch must interview each person to determine there the funds different Each case probably will Among the major banks open der the provisions Morgan Bankers Trust Bank Corn Ex Bank Trust Company Bank Trust Company Irving Company jungle plant intensively Brazil manufacturers of insecti-
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BUSINESS CONDITIONS IN 12TH DISTRICT Banking developments in the 12th district, as in the United States generally, were of dominant importance during late February and the first half of March.- No outstanding changes in the general business or financial situation had been apparent during the first six weeks of the year, although the failure of two rather large and several smaller banks in January had been followed by withdrawals of deposits from other banks. About the time that the force of this adverse influence appeared to be coming to an end, however, widespread publicity given to the Michigan banking moratorium and to other unfavorable banking situations began to have an effect in the 12th district, and immediately following announcement of banking holidays or restrictions in other eastern states on February 25 a substantial run on California banks developed. This relatively heavy run lasted for three days -February 27, February 28 and March 1-when it was brought to an end by a proclamation of the governor of California closing all banks in the state for a three-day period. This action in California was followed by runs on banks in other far western states and by March 3 emergency banking restrictions had been placed in effect in all 12th district states. Withdrawal of currency during the week ending March 1, while at a re. cord rate, was SO short-lived that its effect upon district banks deposits was relatively small. Currency payments by banks to depositors were about 30 million dollars during the week ending March 1, compared with deposits in those banks of considerably more than three billion dollars at the beginning of this year. Banks met the unusual demand for currency by borrowing from the Federal Reserve bank of San Francisco and by drawing upon their reserve balances, which had been built up during the first half of February through transfers of funds from other parts of the United States. Reopening of banks under licenses issued by the secretary of the treasury and by state authorities commenced on March 13 and proceeded 20 most 12th district banks had resumed customary operations, although a good many were either in the hands of conservators or had been closed for liquidation. Currency which had been withdrawn prior to the closing of banks on March 2 was redeposited in large amounts between March 13 and March 20 and considcrably more gold coin was turned in to the Federal Reserve bank of San Francisco than had been withdrawn from January 1 to March 4. 1933. Redeposited currency was sent in to the reserve bank to repay borrowings and to increase reserve balances. Volume of production was slightly smaller in February than in January. Department store sales and intercoastal trafic through the Panama canal increased, but the number of cars of freight loaded on district railroads during the month decreased. Other trade measures changed little. Petroleum production during February approximated that of the preceding month. The cut of lumber declined contrary to the seasonal movement and the volume of engineering construction decreased sharply. Employment conditions remained about the same in February as in January. Commodity prices declined slightly during February, but advanced considerably during and immediately following the banking holiday in March. Non-statistical reports inicate that the banking restrictions during the first half of March reduced business activity. particularly retail sales volume. The engagement of Miss Edna May Bradbury and Willis Cruse has been anounced. Miss Bradbury, laughter of Mr. and Mrs. Lou Bradbury. was the incentive for a surprise party one recent evening given by a number of friends. During the evening she was presented with a shower of gifts for her new home.