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STATE GUARANTY FUND HAS GOOB RECORD OF PAYING DEPOSITORS
Total of Eight Million Dollars Paid Out Under Law Since 1911
FIFTEEN MILLION RAISED BY ASSESSING BANKS
With fl draft for $258,982 made upon the state guaranty fund Tuesday, for the payment of 200 depositors in the suspended Farmers' State bank at Craig, the aggregate amount of money paid out under the provisions of the guaranty law since it was put into force in 1911 is raised to more than $38,000,000. Of that sum, all about $100,000 was disbursed within the last seven years,* that being the period in which the failures have mainly occurred. Altogether, some 45,000 depositors have received payment for 100 cents on the dollar of their claims. In many cases they have been paid interest besides. Solvent banks of Nebraska have contributed $15,000,000 in the form of direct assessments for the guaranty fund to help meet the depository obligations of those which failed. The other $23,000,000 was salvage realized from the assets of the closed Institutions. Total deposits of all state banks now operating in Nebraska (national banks are not included because they are outside the guaranty system) amount to $290,000,000. The guaranty fund has thus taken care of a sum equivalent to about 13 per cent of the deposits of all banks contributing to it at this time. Such a thing as a "run" on a state bank has not happened in Nebraska during recent years. Although 138 in stitutions have been closed and placed in the hands of receivers, and 56 more were taken over in weakened con dition and are still being operated the guaranty commission no scare has ensued among depositors in other institutions leading them to withdraw their money. Since everybody knows that deposits in a state bank which is forced to suspend will be paid by the guaranty fund, an ordinary failure causes little disquietude even in the community where it occurs. People go about their business just as before; the state sends its agents to assume charge of the institution; and in due course of time, generally inside of three or four months, the depositors get their mon
Under such circumstances, a man or woman whose savings are in a closed bank can go to bed and sleep at night without worrying over the possibility of losing them. From the standpoint of the sound banks, which are assessed on their deposits to pay the losses of insolvent ones, the guaranty system is somewhat expensive; but the benefit they derive from the public confidence it inspires in banks generally is worth many times what it has cost, in the opinion of a large number of bankers. A. L. Schantz. of Omaha, president of the largest bank operating under a Nebraska charter, stated recently that his Institution had paid in more than $60,000 as assessments for the guaranty fund, but he had no complaint to make on that scohe because of the feeling of security which the system has implanted in the minds of depos itors, 80 that the good banks do not suffer from withdrawal when a weak one goes under. Since the guaranty fund commission came into existence four years ago, it has succeeded in greatly increasing the ratio of salvage from failed banks and at the same time reducing the cost of receiverships. Where it was formerly unusual for a suspended institution to return to the guaranty fund more than 25 or 30 per cent of the drafts made upon it. the average reimbursement to the fund now runs 60 to 65 per cent. according to Secretary Peterson of the commission. The commission's own members net as receivers of failed banks and draw $10 per day, with expenses, for time actually given to receivership matters. They average 4 or 5 days per month for this service. The commission puts agents in charge of the banks and pays them moderate salaries. Under this plan, much of the expense that used to be incurred when receivers drew fancy salaries and had extensive corps of highly paid helpers is eliminated, and the money goes back to the guar anty fund instead of being squandered.
The Christensen Motor company, who succeeds the Maley Motor company in the distribution of new Hudson-Essex automobiles in this territory, has just received a carload of the late models.
The Methodist kensington ladies will hold a bake sale at the Star market on Saturday, August 6th, beginning at 11:00 a. m. 90-92
