1150. State Savings & Commercial Bank (San Francisco, CA)

Bank Information

Episode Type
Run → Suspension → Closure
Bank Type
state
Start Date
July 1, 1909*
Location
San Francisco, California (37.780, -122.419)

Metadata

Model
gpt-5-mini
Short Digest
822015ea

Response Measures

Accommodated withdrawals, Borrowed from banks or large institutions, Full suspension, Books examined

Other: Receiver S. P. Young appointed; legal actions and injunctions after failure.

Description

The bank suspended/failed in July 1909 and was placed in liquidation/receivership (receiver S. P. Young). Newspapers describe bank insolvency, falsified books, and actions to liquidate assets. Articles mention a threatened/actual small run (borrowing $5,000 to protect clearings) preceding the bank's closing; therefore classified as a run leading to suspension and permanent closure/receivership.

Events (3)
1. July 1, 1909* Receivership
Newspaper Excerpt
References to receiver S. P. Young and liquidation; defunct State Commercial and Savings bank and suits around receiver's actions were reported in Nov. 1910.
Source
newspapers
2. July 1, 1909* Suspension
Cause
Bank Specific Adverse Info
Cause Details
Bank was effectively insolvent, assets described as wiped out completely, questionable/falsified bookkeeping, hypothecation of securities and inability to meet obligations leading to closure and liquidation by the superintendent/receiver.
Newspaper Excerpt
The State Savings & Commercial bank ... suspended in July, 1909.
Source
newspapers
3. July 16, 1909 Run
Cause
Bank Specific Adverse Info
Cause Details
Withdrawals and nervousness triggered by the bank's bad bookkeeping, hypothecated securities, and insolvency concerns; managers borrowed cash to protect clearings when a small run threatened.
Measures
Borrowed $5,000 from Clarence Grange (secured by $15,000 collateral); transferred cash on hand to Anglo and London-Paris National Bank; attempted to protect clearings.
Newspaper Excerpt
when things looked as if We might have a small run we borrowed $5,000 from Grange.
Source
newspapers

Newspaper Articles (7)
1. July 21, 1909 The San Francisco Call San Francisco, CA
Article from The San Francisco Call, July 21, 1909

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note was secured by the shares. Miller gave this note to Grange and the Metropolis bank for collection. Both Miller and Grange declared yesterday that the stock was in the possession of the former and that Grange could not use it. The stock was an important block while the bank was running, for under the bylaws it took a two-thirds vote to secure any internal legislation and this lot carried the balance of power. Grange explained that his other contract with the banks was in the matter of the National Bank of the Pacific deal, in which he contracted to liquidate the 1,674 shares of stock in the national bank under an agreement with Hays. Hays said that in the early stages of the National of the Pacific transaction he and Hasshagen borrowed $34,000 from the Metropolis bank and $59,000 from the Western national. $15,000 IS BORROWED This $83,000 sufficed for the purchase of the stock, but later $15,000 was borrowed on collateral from the Western national to strengthen the State savings and commercial. At the time this $83,000 loan was secured from Grange's two banks Hays had $21,000 to his credit in the State savings and commercial, he said, and Hasshagen had $24,000. This $45,000 was left in the vaults, however, and the young financiers went to Grange to help them out in their big scheme. Grange ended by swallowing the big stew they brewed. Prior to the campaign which was to lead to the annexation of the National Bank of the Pacific Hays had a Burbank scheme of grafting a fresh new national bank on the moribund stock of the Union state bank. He was busy calling in stock in the Union state, for which he was to exchange stock in this newly propagated institution. But before he got the cuttings ripe he started after the National Bank of the Pacific and failed to land. The hypothecation of securities of the bank will be gone into by Anderson and A. Wenzelburger, the expert accountant. Some of the securities were deposited with the Western national. Part of the lot covered the clearing house account and other papers protected the $15,000 loan. Grange declared that the securities are triple the value of the loan made. As the Union state and the State savings and commercial simmered in a banking goulash, their accounts have not yet been segregated sufficiently to satisfy the examiners that the other securities covering loans are well placed. WHAT ANDERSON SAYS "It will be a week before this will be straightened out and our experts are able to tell where the banks stand in regard to the depositors," said Anderson yesterday afternoon, on leaving the bank offices in the Monadnock building. "The assets are wiped out completely, but if the books have not been falsified the banks can meet their obligations. The people who deposited money on Saturday morning before the bank closed its door will receive it back immediately upon making proof of No other altra

2. July 23, 1909 The San Francisco Call San Francisco, CA
Article from The San Francisco Call, July 23, 1909

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of the directors. "Grange promised to protect our clearings and then threw us down. When things looked as if We might have a small run we borrowed $5,000 from Grange. With that loan Grange promised to protect our clearings. We gave him $15,000 security for the $5,000 loan. and even at that he would not keep his promise." Grange placed an entirely different interpretation on his promise to help the bank out of its difficulties. He admits that he lent the bank $5,000 on the 16th and that his note from the bank was secured by $15,000 worth of collateral, but denies that he broke any promise. Hays called at the Metropolis bank on the morning of the 16th and asked Grange to let the State savings bank have sufficient coin to protect its clearings. Grange agreed, taking the aforementioned collateral as security. That he did not exact too much security is made apparent by his statement yesterday, in which he said that besides the $5,000 clearings that he protected were about $5,000 in checks, on one of which, a check for $1,000. payment had been stopped. NEEDED EXTRA SECURITY "I exacted the extra security on account of the checks. I was unable to tell how good the checks were, and I had to protect myself further than the I $5.000 cash clearings," he said. "If hadn't, and several of those checks had been protested or payment on them stopped. I would have been out.' Grange had considerable sympathy for Kington when told that Kington had made a declaration that he had been stung. "I guess that's true," he said. "Kington got into that bank as an attorney and was induced by W. C. Hays to invest his money in the new national bank that they were going to organize. He doesn't know the first thing about book keeping, and when he examined the books and became*puzzled over any entry it was always explained to him as being all right, and he took it for granted that it was. I guess he has lost about every cent he had." The marble cutters employed by the American marble and mosaic company. who erected the new marble front that has been placed at the entrance to the bank. have not received their money, and are beginning to worry, They presented a demand yesterday, but it was referred to Examiner Young, who would not honor it. All cash on hand has been transferred to the Anglo and London-Paris national bank and no bills will be paid until the exact condition of the bank has been ascertained. DISPUTE OVER NOTE CERTAIN That there will be a dispute over the Monnier note seems to be certain. Charles L. Patton and Kington say that there is no reason why the note should be protested, as it was given for services rendered. Mrs. Monnier says that the matter of the fee. to be paid Patton and Kington has not yet been settled, and declares that the fee will not be as much as $20,000. In the meantime the note is in the hands of Clarence Grange, drawing interest. No progress report was made by Bank Examiner Young yesterday. He and his corps of assistants were kept busy trying to unravel the mysteries of Hays' book keeping.

3. July 2, 1910 Los Angeles Herald Los Angeles, CA
Article from Los Angeles Herald, July 2, 1910

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Alden Anderson Forwards Letter to Governor Gillett Announcing His Retirement OUTLINES RESULT OF WORK Will Give Entire Time to His Campaign for Republican Nomination [Associated Press] SAN FRANCISCO, July 1.-Alden Anderson, state superintendent of banks, in order to give his entire time to his campaign for the Republican nomination for governor, has forwarded to Governor Gillett the following letter of resignation Permit me herewith to tender my resignation as superintendent of banks of the state of California, to which office you appointed me on July 1, 1909. take this action because of my candidacy for political office, in order that I may devote time to the campaign. The annual report of this office, required by law, will be submitted in October, but I deem it appropriate at this time to give a short resume of what has been accomplished during my incumbency. On July 1. 1909, when I assumed office, there were 486 state banks. During the year forty-five new banks have been established. However, owing to consolidation and amalgamation, facilitated by the provisions of the new law for departmental banking, liquidation, voluntary or otherwise, the number of banks has not been materially increased, there being at the present time 491. Thirteen banks changed from the state to the national system. I am pleased to say that this is a smaller number than nationalized during the previous year. $458,825,577 IN DEPOSITS The total individual deposits on July 1, 1909 (excluding deposits in banks nationalized during the year) were $403,472,990.71. On March 29, 1910, the date of the last call. practically nine months of administration, there were individual deposits of $458,825,577.80 showing a net gain of $55,352,587.09; a handsome showing, and one confirming the opinion that stringent and effective bank laws and efficient administration would win the confidence of the people and substantially increase deposits. During the year forty-eight banks were required to make good impaired capital stock varying from 10 per cent to 70 per cent. and in one case 150 per cent. Doubtful assets have been written off, excessive loans reduced, overdrafts and investments in stocks largely eliminated. I have found it necessary to close twelve banks, including two branches. The affairs of two of them were so handled that the depositors were able to secure their deposits without discount immediately, the assets of both being sold outright to other banks. The liquidation of another, the State Savings and Commercial bank of San Francisco, had progressed far enough so that I would have paid a first dividend of 60 per cent to depositors on May 1 last had I not been restrained by the suit brought against me as superintendent of banks, in which the constitutionality of the bank act was brought into question. I have done everything possible to bring about a speedy adjudication of the same, and hope for a final decision in the near future. EIGHT BANKS CLOSED Eight of the banks closed were controlled and managed by Japanese. Three of these were allowed to resume business after making good their impaired capital. In realizing upon the assets of these banks I have found it necessary to file fifteen suits, eight petitions for the sale of property and fifteen claims in bankruptcy proceedings. There have been filed against me in my official capacity eighteen suits for various reasons. As soon as the suit, involving the constitutionality of the bank act, has been settled the affairs of all banks now in liquidation can be closed up rapidly The liquidation of the closed banks has been conducted with strict economy. One receiver in a central office has acted for all of them. In this manner expenses have been kept down to the minimum, to the benefit of depositors. When final statements are rendered they will show conclusively the effectiveness and economy of this method of liquidating failed banks, and demonstrate that this feature of the new law has been an unqualified success. In the performance of my duty I have had the moral support and cooperation of the conservative bankers of the state, who realize that their own position is strengthened when all banks are put in an absolutely safe and sound condition. At the present time there are only two banks giving the department any trouble, and, including these, every bank in the state is solvent and able to pay its depositors in full. The present bank law should practically eliminate bank failures. Thanking you for the confidence manifested in selecting me for the administration of the affairs of this important office, and hoping that my handling of the same has been satisfactory to yourself and to all the people of the state, I am sincerely yours, ALDEN ANDERSON. Banks

4. November 17, 1910 Dziennik Chicagoski Chicago, IL
Article from Dziennik Chicagoski, November 17, 1910

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Telegramy krajowe. San Francisco, Cal., 17 listopada. - Ciekawy uzytek z zakazu sadowego (injunction) zrobiono poraz pierwszy W tem miescie, kiedy Artur Crane, byly prezydent upadlego banku State Saving and Commercial Bank, W wyszym sadzie postaral sie o zakaz - spelnienia morderstwa. Wierzyciele banku chca bylego urzednika zamordowac - a on broni sie zakazem sadowym. Zakaz skierowany jest przeciw receiverowi, któremu zakazuje podniecaé umysty wierzycieli przynajmniej do 18 listopada, kiedy sprawa odbedzie sie W sadzie. Crane utrzymuje, ze receiver S. P. Young i egzaminator banku bezprawnie wzieli interesa banku W swoje rece i wine na niego zwalili. Bank ten upadt W lipcu, 1909 roku. Waszyngton, 17 listopada. Departament sprawiedliwosci oglosit wczoraj swe zidanie W sprawie przestepców prawa antitrustowego, W którem uwaza kare wiezienna dla tych przestepców za jedyny i skuteczny srodek, kary pieniezine nie odstrasza innych od monopolizowania pewnych artykulów W przemysle handlu. Departament oswiadczyl sie przeciw karze pienieznej przy tej sposobnosci robi wyrzuty sedziemu J. I. Youngowi W

5. November 17, 1910 Los Angeles Herald Los Angeles, CA
Article from Los Angeles Herald, November 17, 1910

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COURT GRANTS WRIT TO PROTECT BANKER'S LIFE Stockholder of Defunct Institution Says He Has Been Threatened with Violence SAN FRANCISCO, Nov. 16.-Alleging that the depositors of the defunct State Commercial and Savings bank were seeking his life, Arthur Crane, one of the principal stockholders of the bank, was granted a temporary writ today by the superior court, forbidding them from visiting personal violence upon him. Named in the writ were Alden Anderson, state superintendent of banks; S. P. Young, chief deputy bank superintendent; W. C. Hays, former general manager of the Union Savings bank, which absorbed the State bank previous to its failure, and a number of the depositors of the two banks. The complaint on which the temporary writ was issued declared that Young had told Crane that unless he paid the claims of the depositors he would not answer for Crane's life. Crane also asked for an order forbidding the sale of a large number of securities and much real estate held by the receiver of the merged banks. He alleged that State Superintendent Alden Anderson had surresptitiously removed $7000 worth of fixtures from the building of the defunct bank. The petition to make the temporary order permanent will be heard by Judge Seawell on Friday.

6. November 17, 1910 The Salt Lake Tribune Salt Lake City, UT
Article from The Salt Lake Tribune, November 17, 1910

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BANKER FEARS VIOLENCE FROM THE DEPOSITORS SAN FRANCISCO, Nov. 16.-Alleging that the depositors of the defunct State Commercial and Savings bank were seeking his life Arthur Crane, one of the principal stockholders of the bank. was granted a temporary writ today by the superior court. forbidding them from visiting personal violence upon him. Named in the writ were Alden Anderson, state superintendent of banks; S. P. Young, chief deputy bank superintendent: W. C. Hays, former general manager of the Union Savings bank, which absorbed the State bank previous to its fallure. and a number of the depositors of the two banks. The complaint on which the temporary writ was issued declared that Young had told Crane that unless he paid the claims of the depositors he would not answer for Crane's life. Crane also asked for an order forbidding the sale of IL large number of securities and much real estate held by the receiver of the merged banks. He alleged that State Superintendent Edson had removed $7000 worth of fixtures from the building of the defunct bank. The petition to make the temporary order permanent will be heard by Judge Sewell on Friday.

7. November 18, 1910 Rock Island Argus Rock Island, IL
Article from Rock Island Argus, November 18, 1910

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TO PROTECT LIFE San Francisco Banker Makes Use of Injunction as Means of Defense. SAYS HE IS THREATENED Declares Receiver for Failed Institution Has Incited Creditors Against Him. San Francisco, Cal., Nov. 18.-Novel use of the injunction was made in this city yesterday when Arthur Crane, one time president of the defunct State Savings & Commercial bank, obtained from Superior Judge Seawell a restraining order to prevent the depositors and creditors of the suspended institution from killing him. The order is directed against S. P. Young, receiver of the bank, and forbids him to incite the creditors or others to do violence to Crane, at least until Nov. 18, when the matter will be fought out in court. Says It Is Receiver's Fault. Crane charges that Young and Bank Examiner Alden Anderson are in possession of the bank's assets without due authority of law, and his alleged grievance against Young is that the latter has put the responsibility for the present predicament of the bank's creditors on him. The complaint states that on Sept. 22 of this year Crane called at Young's office and was told that his life would not be safe if he did not immediately abandon his claim to the bank's assets. Young told him, the former banker says, that more than 20 creditors had called and threatened to shoot him (Young) for keeping them out of their rights, and that he had been compelled in self-defense to tell them that "Crane was the man." Threats on Life Charged. It is said that the creditors became so excited against Crane that they left Young's office vowing vengeance and threatening to kill the former bank president. Crane claims that he remonstrated with Young for his course of conduct, but that Young insisted that the only way to preserve his own life was to "put it off on Crane." Believing that Young would incite others to violence, as Crane puts it, he applied to the court for protection. The State Savings & Commercial bank was a small concern, which suspended in July, 1909.