12509. Hackensack Bank (Hackensack, NJ)

Bank Information

Episode Type
Suspension → Closure
Bank Type
state
Start Date
November 20, 1879
Location
Hackensack, New Jersey (40.886, -74.043)

Metadata

Model
gpt-5-mini
Short Digest
697405daa15b8f7a

Response Measures

None

Description

Articles from Nov 1879 describe the Hackensack Bank insolvent under President Charles H. Voorhis, with committee recommending liquidation and the Comptroller threatening to place the bank in receivership. No contemporaneous run is described. A separate 1889 article describes formation of a new state-chartered Hackensack Bank a decade later — a new institution, not a reopening of the failed 1879 bank.

Events (2)
1. November 20, 1879 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Severe mismanagement and large worthless loans and overdrafts by President Charles H. Voorhis left the bank heavily impaired; committee reported large losses and recommended reduction of capital or liquidation; Comptroller threatened receivership if not wound up promptly.
Newspaper Excerpt
A communication was read at the meeting from the Comptroller of the Currency to the effect that if the affairs of the bank were not speedily wound up he would place it in the hands of a receiver.
Source
newspapers
2. July 9, 1889 Other
Newspaper Excerpt
It will be ten years next November since the First National Bank of Hackensack closed its doors... the bank will be ready for business about September 1; it will ... be organized under the State law, and will be called The Hackensack Bank.
Source
newspapers

Newspaper Articles (3)
1. November 20, 1879 The New York Herald New York, NY
Article from The New York Herald, November 20, 1879

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Article Text

BANKER AND CONGRESSMAN. MR. VOORHIS' MANAGEMENT OF A NEW JERSEY FINANCIAL INSTITUTION-COUNTING THE LOSSES. An adjourned meeting of the stockholders of the Hackensack Bank, of which Congressman Charles H. Voorhis was president, was held in the bank building yesterday. At the last meeting Mr. S. E. De Groote and Mr. John Swinburne, cashier of the First National Bank of Paterson, were appointed as a com. mittee to examine into the affairs of the bank, and it was principally to hear their report that yesterday's meeting was called. Mr. Voorhis' liabilities are now set down at about $250,000, with but few available assets. The committee reported that out of $131,00 loans and discounts made under Voorhis' presidency $81,000 are totally worthless, $30,000 doubtful and the balance available. On the list of liabilities and pad debts are to be found the following:-Charles H. Voorhis, executor of Tallman estate, $11,000, the estate never being considered worth more than $6,000; $10,000 in promissory notes signed by Mr. Voorhis' wife, total loss; Mr. Voorhis' own notes for $9,000, indorsed by himself and secured by stock of the defunet Union Bank, also a total loss; notes of the Hackensack Water Company, which is owned and controlled by Voorhis, amounting to nearly $20,000, and judgment against I. S. Christie, amounting to $9,400. utterly worthless. These and other small debts make up the sum of $80,000. There were also discovered over drafts, made upon the bank by Voor. his' friends amounting to $9,000, which are hopelessly bad; Voorhis' personal overdrafts sum up $6,000; Hackensack Water Company overdrafts, $1,800, and C. H. Voorhis, executor, $500. It is also reported that the Third National Bank of New York holds a note of $10,000 drawn by the Hackensack Water Company, indorsed by C. H. Voorhis as President, and for which the Hackensack Bank is liable. The committee presented three schedules to the stockholders for their consideration. The first exhibited the impairment which would have to be made good if the old capital of $100,000 was retained-viz,, seventy-three per cent or $73,000, Schedule No. 2 represented the amount to be paid in by stockholders in the event of a reduction of capital to $50,000-viz., forty-three per cent. Schedule No. 3. showed the amount to be expected by the stockholders, should the bank go into liquidation-viz,, twenty-five per cent. Of the 534 shares of the bank stock owned originally by Mr. Voorhis all of it has been hypothecated with New York and Jersey City banks, the holders of which refuse to become owners, as by doing so they, under the National Banking law, would be responslble fo: the liabilities of the bank. NO BOND. It was also discovered by the committee that, notwithstanding one of the laws of the Hackensack Bank explicitly states that the president should give a bond in the sum of $10,000, no such document was ever executed. This also reduces the securities from which the stockholders might possibly realize something. Several bank presidents, among others Mr. Jordan, of New York, and Mr. Young, of Jersey City, upon examining the schedules, refused to have anything further to do with the matter and expressed their entire willingness to let the bank go into liquidation. A communication was read at the meeting from the Comptroller of the Currency to the effect that if the affairs of the bank were not speedily wound up he would place it in the hands of a receiver. The Hackensack Savings Bank, which is simply an offshoot of the bank proper will, it it is thought probable, also go into liquidation. The meeting was adjourned until Saturday morning, when it is expected that some conclusive action will be taken by the stockholders. Mr. Voorhis still remains in Hackensack, but is seldom seen outside of his residence and refuses to converse upon the subject of his bankruptcy.

2. November 20, 1879 New-York Tribune New York, NY
Article from New-York Tribune, November 20, 1879

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Article Text

Present Original Item. Value. Amount. $3,000 $11,000 Charles H. Voorhis (executor) None. 10,000 Mrs. Charles H. Voorhis (notes) 1,064 9,000 Charles H. Voorbis (notes) None. 18,853 Hackensack Water Co. (notes) None. 9,400 J.S. Christic (judgment) In addition to these heavy items, there are overdrafts of Mr. Voorhis for $9,000. The committee has been informed by the cashier of the Third National Bank of this city that his bank holds a note of the Hackensack Water Company, the stock of which was almost exclusively owned by Mr. Voorhis, for $10,000, which had been indorsed by Mr. Voorhis as the president of the Hackensack Bank, and that the latter institution is hable for the full amount. The|Hackensack Bank also holds overdrafts of the Hackensack Water Company for $1,800. The committee presented three propositions. As the total impairment of the capital 18 $73,000, and in order to keep the stock at $100,000 the amount of the impairment must be made good at once. C. N. Jordan, the cashier of the Third National Bank of this city E. F. C. Young, the president of the First National Bank of Jersey City, and others who had offered to help reorganize the bank, at once stated that they would not now attempt to build it up, as it was in too bad a condition. The second proposition was to reduce the bank's capital to $50,000. and put in enough money to cover the deficiency below that sum. The third proposition was one to let the institution go into voluntary liquidation. After paying the necessary expenses it was estimated that the stockholders would receive about 25 per cent of their original subscription. Mr. Voorhis held 534 shares of the stock of the bank, and at the time of his suspension this stock was held by banks in this city and Jersey City as security for loans made to him. A meeting of the stockholders of the bank will be held Saturday morning when a resolution will probably be adopted, it is said, to let the institution go into volantary liquidation. The Controller of the Currency insists upon speedy action in the matter, and if the officers and stockholders do not come to some detision Saturday he will appoint a receiver, it is stated, to wind up its affairs, By the rules of the bank the president should give a bond for the sum of $10,000, but this was never done by Mr. Voorbis. The liabilities of Congressman Voorhis will nov. sxceed $250,000 or $260,000. Mr. Voorbis's health has improved, but he remains quietly at his home in the village and only sees his most intimate friends. No further criminal proceedings have been begun against him.

3. July 9, 1889 The Jersey City News Jersey City, NJ
Article from The Jersey City News, July 9, 1889

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Article Text

Hackensack's New Bank. It will be ten years next November since the First National Bank of Hackensack closed its doors. A year later, in 1880, John J. Berry, cashierof the Bank of Bergen County, dropped that institution into a hole at the bottom of which he first sunk $280,000. Since that time Hackensack has had no banking facilities, its citizens being compelled to go to Paterson, New York or Jersey City. -This state of affairs was the cause of constant annoyance, and frequently when village merchants could not cash checks great inconvenience was experienced. While the seriousness of the situation has been recognized by all interested, it has been impossible to induce capitalists to give the needed relief because of the lack of confidence engendered by past disasters, a feeling intensified by the general public expressions of distrust. Lately, however, there has been a change of sentiment, the community being susceptible to the constant arguments of the local press and a number of business men who were anxious to have a bank established. The proposition to open a bank was brought to a head on Wednesday evening, when there was a meeting at the office of Lawyer William M. Johnson and the subject was fully discussed by the several gentlemen present. Among the more prominent names in the company are Henry S. Little (late receiver of the Central Railroad of New Jersey), County Clerk Taylor, Surrogate Pell, Dr. David St. John, Nicholas Mehrhof, the brick manufacturer; Major S. H. V. Moore, William M. Johnson, M. E. Clarendon, Cornelius J. Cadmus, of Dundee Lake; F. A. Anthony, Howard D. Terhune and James A. Romeyn. These gentlemen have pledged themselves to take all the $50,000 stock with which the bank is to start, though they are willing to dispose of a few shares to others if applied for by July 12. It is understood that the bank will be ready for business about September 1; it will occupy the room of the late Bank of Bergen County, is to be organized under the State law, and will be called "The Hackensack Bank." The officers have not been determined upon, but it is believed that William M. Johnson will be president, and Howard D. Terhune cashier, Mr. Terhune being now cashier of a bank at Matawan. It is believed that William Walter Phelps will have an interest in the bank, which will open its doors under very favorable auspices, considering the difficulties that have had to be overcome. The gentlemen who will be most conspicuous in the Board of Management (Messrs. Pell, Taylor, Johnson and Moore) are well known to the people of Bergen county for their conservative business methods, and their names will no doubt have considerable influence in establishing the confidence requisite to success. The project was made public in the Hackensack local papers yesterday, and already several applications for stock have been voluntarily sent in.