13096. Harrison State Bank (Harrison, NE)

Bank Information

Episode Type
Run → Suspension → Reopening
Bank Type
state
Start Date
December 18, 1929
Location
Harrison, Nebraska (42.687, -103.883)

Metadata

Model
gpt-5-mini
Short Digest
7699b4f5

Response Measures

Partial suspension, Books examined

Description

Bank was closed Dec 18, 1929 after malicious/unfounded rumors (originating ~Wyoming) caused a run. Officers closed doors to protect depositors. Bank reorganized and reopened mid-January 1930 with full payment to depositors and restrictions on large withdrawls (over $500) to protect borrowers.

Events (3)

1. December 18, 1929 Run
Cause
Rumor Or Misinformation
Cause Details
Malicious/unfounded rumors (originating in a nearby Wyoming town) and adverse newspaper advertisements prompted depositors to withdraw funds.
Measures
Officers closed the doors to stop the run and protect depositors; later reorganized under supervision and agreed withdrawal schedules for large accounts.
Newspaper Excerpt
The Harrison State bank at Harrison, Nebr., which closed its doors Dec. 18, 1929 following malicious rumors as to its solvency ...
Source
newspapers
2. December 18, 1929 Suspension
Cause
Rumor Or Misinformation
Cause Details
Immediate cause was unfounded rumors and malicious newspaper reports questioning the bank's solvency, which led to rapid withdrawals and forced closure.
Newspaper Excerpt
To save the bank from utter ruin, the officers closed the doors.
Source
newspapers
3. January 19, 1930 Reopening
Newspaper Excerpt
Reopening today, the bank had deposits of 334 thousand dollars ... Unfounded rumors ... brought about the closing just days ago. Reopening today, the bank had deposits of 334 thousand dollars ... undivided profits of $4,200 after charging off the doubtful items. (Omaha World-Herald, Jan. 19, 1930).
Source
newspapers

Newspaper Articles (3)

Article from The Mitchell Index, December 26, 1929

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Article Text

Established 1901 per Annum ADVERTISING RATES Display advertising, 25 cents per Inch each insertion. Additional charge for special position; no deduction for plate furnished. Agency commission only to regularly established agencies. Locals in "Want-Ad" column are cents per line per week, with miniman charge of 25 cents. Same with news locals 10 cents per Ine. Lengthy readers, such as Sale Notices, Political Announcements, Obituary Poetry and reading matter of any kind, 5 cents per line. Legal notices at legal rates. WAGGING TONGUES So it goes. The reports concerning the closing of the Harrison State bank last week indicate the work of ging tongues," this time in the form of a newpaper report, which was magnified from mouth to mouth, until led to run on the In order save the bank from utter ruin, the officers closed the doors. The same kind of case developed in Neligh, Nebr., few weeks It is said the first ago. of the bad reports about the Antelope State bank was started at bridge party. The story that the bank was weak was spread from mouth to mouth, until it caused run, and the bank closed. The writer witnessed bank "run" in Milwaukee some years ago, which was started by disgruntled borrower. The depositors were mostly foreigners, and the borrower, who had been turned down at the bank, decided to even things up and came very near doing it. The whole foreign population made demands for their deposits. When other banks in the city learned of the predicament of bank, they sent all available cash they could muster to the aid of the particular institution, for other banks knew it to be safe and sound bank. Depositors who demanded the money got it. Along in the afternoon, the depositors began to relaize they had been led to believe an untruth, and steady stream of re-depositing began to flow into the bank. The banks of the city saved fellow institution and averted crash. But that kind of a condition cannot exist in small towns. Cash is not available to stem rush of deposit withdrawals, even though other banks are certain the bank which is being "run" is sound. In these times, when there have been so many bank failures, people are more given to talk of this bank's condition, that bank's condition. Now and then some easily influenced man or woman gets fearful of some certain bank, draws out his or her money, and then proceeds to tell friend what he did. This leads to others becoming panicky, and the next thing that happens good bank weakened and oftentimes, as in the above mentioned cases, the bank is closed. And all this happens without foundation. Banking laws require banks to publish statements of condition. These statements appear at intervals about every three months. They are for the perusal of the public and are for public protection. Most anyone can read bank statement and judge its condition. True, it is, that the note case tells the story, but if there is a good spread between the deposits and the loans, and the cash reserve is fifteen or more percent of the deposits, there is little fear that the bank is going to erash any time soon. The public could, if it would, find out for itself the condition of any bank it is interested in. and thereby gain first hand information without relying upon the "bunk of the busy brains" or the reports of the "wagging tongues." Bank failures in any town are not to be desired, and many of them could be averted if people would think more and talk less. How from Growing Old A writer in the American Mutual magazine said in sarcastic way, lot of things that would be well for many of us who drive automobiles to think about. Here they are: "Alwaws drive fast out of alleys; might hit policeman; there's no telling. "Always race with locomotives to crossings; engineers like it; it breaks the montony of their jobs; it is always good test for your car. "Always pass the car ahead on the curves or turns; don't use the horn because it might unnerve the other fellow and cause him to turn out too far. 'Demand half of the road, the middle half; insist upon your rights. "Always lock your brakes when skiding; it makes the job more artistic; often you can turn clear round. "Always drive close to pedestrians in wet weather; dry cleaners will erect monument to your memory. "Always try to pass cars on hills when it possible; it shows your bus has more power, and you can turn surely if you meet another car at the top. "Never look around when you back up; there is never anything behind your automobile. A few shots of booze will enable your car to do real stunts; for permanent results quaff long and deeply of the flowing bowl before taking the wheel. "Drive as fast as you can on wet pavements; there is always something to stop you if you lose control, often heavy truck of plate glass window. "New drivers should be shown how to drive fast in heavy traffic; it gives them the experience every motorist should have. "Never and listen at railroad crossings; it consumes times, and besides nobody believes in signs. "In wet weather drive in trolley tracks; it's smoother going." One of the cheapest kinds of advertising bunk which has been promulgated lately was when the Radio corporation of America tried to create the impression that President Wilson initiated this organization through Mr. Owen D. Young, whom many gard as a possible presidential candidate on the democratic ticket. Mr. Young is one of the active executives of an organization closely affiliated with the Radio corporation of America. The basis for the report is that President Wilson did urge Mr. Young not to allow the patents on certain important radio devices get into the hands of foreign holders to the detriment of this country. The radio corporation of America is very im portant link in the radio trust, and the idea of such private monopoly was wholly abhorrent to President Wilson. But this only shows to what lengths selfish men will go to forward their own ends. President Hoover set up farm lief board to relieve agriculture, pointing Chairman Legge of the harvester trust to head it. He then sets up business board to relieve market depression, and appoints Julius H. Barnes, head of the wheat trust, to be its chairman. Now Legge and Barnes are quarreling with each other, and farm relief seems just as mote as ever. Artificial farm relief farce. Getting square deal for agriculture, which is the only intelligent way to give farmers an opportunity to work out their own relief, seems long way off. The Greeley, Colorado, News, expresses the hope, now that Commander Byrd has the south pole, he may "find the darned thing, and will bring it back to set up somewhere where the rest of have chance to see it without running the risk of taking cold." Many valley farmers made New Year resolutions this fall that will probably go the way of many that will be made next will be postponed. To make the Christmas season complete, why not pay your subscription that is, if there is anything left to pay with. It would take powerful magnifyglass to make some bank accounts discernable today. Christmas comes, but once year's Happy New Year to you. NOTICE To residents of Sioux County: The law provides that automobile licenses shall be procured from the county treasurer of the county in which you reside. You are requested to purchase 1930 licenses from county treasurer of Sioux county. County Board, Sioux Co., Nebr. Famous Crackers— Soda. Ice. Oyster. Nut. Safe. Whip. Dome. Fire. Jim. Wise.


Article from Omaha World-Herald, January 19, 1930

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Article Text

STATE REOPENING ANNOUNCED Rumors Blamed for Shows $4,200 Balance quiry "Undivided Profits." Neb., Jan. surplus and resources its capital, intact, the Harrison State bank was today for Harrison business under the same management without the depositors losing penny. Unfounded rumors, State Bank Commissioner Woods combining advertising nearby Wyoming town questioning Nebraska banks. brought about the closing just days solvency of the bank certained when positors began investigation representative of the bank department. To possible future stress, thou sand worth of "doubtful" removed. Reopening today, the bank had deposits of 334 sand dollars, loans and 201 far above the amount quired by law. To the commission said, has undivided profits account of after charging off the doubtful items.


Article from Chadron Record, January 24, 1930

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Article Text

Reorganize State Bank At Harrison Depositors Reliaze 100 Percent Of Deposits-Rumors Were The Cause Of Closing The Harrison State bank at Harrison, Nebr., which closed its doors Dec. 18, 1929 following malicious rumors as to its solvency was reorganized and opened its doors Saturday morning. Payments on deposits of the bank were 100 percent it was announced by Bank Commissioner George Woods. The reorganization work was carried out by a depositors committee assisted by Examiner C. A. Lau and Commissioner Woods, who found that the bank was in a solvent condition, and so it reopened with the same capital and the same deposits. The bank has deposits of $334,000, loans of $291,000, with cash reserve well above the legal limit. The capital is $20,000, with a surplus of $10,000 and net undivided profits of $4,200 after all of the bad paper was charged off. The only stipulation to which the depositors had to agree was that those with deposits over $500 had to agree that they would not withdraw their funds, other than under scale established by Commissioner Woods. Those holding time certificates of deposit over $500 could take out their money in installments not to exceed 25 per cent each six months over a period of twenty-four months. Those having checking accounts could not withdraw an excess of one-third each six months over a period of eighteen months. Depositors with less than $500 can draw their entire account if they desire. This move was for the protection of the borrowers whose paper the bank still holds, and which is all good. If the bank was forced to collect money on notes now it would be hard on many of the ranchers of the vicinity who would be forced to sell their effects to clear their obligations to the bank. The bank retains the same officers, who are George Gerlach, president, and J. L. Gerlach, cash- ier. Commissioner Woods in his investigation found that rumors starting in Wyoming forty miles to the west of the town started a rapid run on the bank and the officers closed the institution to protect the depositors. Newspaper advertisements were used in the adverse and malicious statements that were allegedly published about the bank. This is the twenty-second state bank to reorganize and reopen.