State Bank - Denver, CO

Bank Information

Episode Type: Run → Suspension → Reopening
Bank Type: state
Start Date: July 20, 1893
Location: Denver, Colorado (39.739, -104.985)

Metadata

Model: gpt-5-mini
Short Digest: 04e73d55

Response Measures

Full suspension, Books examined

Other: Bank examiner arranged reports to comptroller; eastern banks shipped cash to Denver banks.

Description

Multiple July 1893 newspaper dispatches report timorous depositors and heavy withdrawals that forced the State Bank (Denver) to close temporarily. Reports indicate the closure was to forestall the heavy demands and bank examiners and officers expected resumption in a few days; no evidence articles show a permanent failure or receivership.

Events (3)

1. July 20, 1893 Run

Cause: Macro News
Cause Details: Widespread contraction/panic linked to recent monetary issues and general timorous withdrawal of deposits across Denver; banks experienced heavy withdrawals and inability to liquidate securities.
Measures: Closed doors temporarily to forestall heavy demands; paid out large sums prior to suspension (reported $900,000 paid out within 30 days).
Newspaper Excerpt: The timorous feeling among depositors in the Denver banks ... The German, State and People's National banks closed their doors yesterday in order to forestall the heavy demands that it was evident would be made.
Source: newspapers

2. July 20, 1893 Suspension

Cause: Macro News
Cause Details: Banks suspended payments due to heavy withdrawals and tight money market (inability to realize securities and lack of ready cash after large outflows).
Newspaper Excerpt: The State bank and the German Nat. closed their doors ... the State National failed to open for business this morning ... a notice to the effect that the (bank) would not open owing to lack of ready cash.
Source: newspapers

3. * Reopening

Newspaper Excerpt: Mr. Adams ... said that he believed the suspended banks will all resume business in a short time; the people are now stopping to think, with the result that ... more money was deposited than was withdrawn.
Source: newspapers

Newspaper Articles (6)

1. July 19, 1893 The Providence News Providence, RI

Article from The Providence News, July 19, 1893

Click image to open full size in new tab

Article Text

New York Market. SPECIAL TO THE NEWS. NEW YORK, July 19.-The opening this morning in stocks wa encouraginr. but the bears soon brought about a lissitude that no one seemed willing to combat Denver was more hopeful. The prospect of resumption by a number of banks which had closed their doors yesterday seemed good, and even when the State bank and the German Nat. closed their doors more trouble was anticipated, this disaster which has struck the queen city of the west readily finds it explanation in the unsound doctrines recently uttered by the governor of Colorado. Eastern banks could no longer afford deal with banks situated in such communities and they at once shut down on loans to the Denver banks, without ready cash the banks were compelled to close their doors. When this panic is well past and men review their exgeriences and count their 104865 they will find a very small portion of them due to national bank failures. Under ordinary conditions the Denver banks would doubtless have continued busi ness without trouble. But then securities were as unsaleable as wint overcoats in July. Not that the ov rcoats are not good, or that the securities are not valuable, but nobody wants them. e same is true of stocks. Exchange dropped today 11/4 below yesterday, and stood at 4.83% The cause was the more plentiful appearance of grain bills and the lack of demand for bills to pay for stocks sold for foreign account. Curerncy continues to flow into N. Y. in fair amounts. The withdrawal of 50,000 from the sub-treasury was mainly for St. Louis. The Illinois Central declared its regular six months diIt vidend of 21/1 per cent. showed a net increase of $560. 854. The business of Reading is greater than that of any other trunk line, except the New York Central The gold reserve, Washington, is $97,672,852, n decrease of $400,000 since yesterday. The market ali day was active, and at the close there was not a great decline from yesterday.

2. July 20, 1893 Evening Star Washington, DC

Article from Evening Star, July 20, 1893

Click image to open full size in new tab

Article Text

Contraction and Inflation. To the Editor of The Evening Star: In yesterday's STAR William Birney, in opposing (as I do) the proposed ten-million-dollar loan,said: "Twenty millions( equivalent to thirty millions if the gold standard be adopted) is a ... If the coinburden heavy enough. age be contracted, as is threatened," &c. I have not heard of any proposition to adopt the gold standard any more completely than it has existed since the resumption of specie payments in 1879; I have heard objections to the abandonment of that standard and the adoption of a silver one. I have not heard of any threat to contract the currency; the most heroic measure I have heard proposed has been to repeal the "Sherman act" and cease expanding the currency. Since Mr. Birney is 80 fearful of a contraction of the currency, it may be well for him to note that it has been enormously contracted already as the result of our recent pro-silver legislation, and fears of more of the same sort. During the year ending June 30, 1893, our exports of gold amounted to $108,680,884; our imports to $21,174,381; excess of imports over exports, $87,506,463. There. to begin with, is a contraction of $87,500,000. A few years ago there was, outside of the treasury and of the national banks, over $300,000,000 in private hands in circulation. (See report of the director of the mint for July 1, 1891). Where is that gold now? Hoarded by its owners, who think that if gold is destined to go to a premium they may as well reap the profit as to have it go to the banks or the government. There is a contraction of the currency to the full extent of all the gold that was once in circulation, but now has gone out of it. Those of the citizens of the United States who are possessed of ordinary intelligence (and this embraces a large and increasing proportion of them) are well aware that there has never been a rapid inflation of the currency without most baneful results. Witnessing the utterly needless purchase of 4,500,000 ounces of silver per month, and threatened with the free and unlimited coinage of fifty-cent silver dollars, the timid class of community decided to take their cash out of the banks rather than risk its loss in the financial crash they feared. The banks, having less money on deposit, had less to loan. The calling in of loans and the refusal to make more. because all the money obtainable was needed to satisfy the demands of depositors, by just so much reduced the amount of money in circulation. From the 1st of January to the 1st of June, 1893 (according to the reports of the national banks to the controller of the currency), their resources were thus crippled to the amount of seventy-eight millions of dollars. When we read in yesterday's dispatches that the State Bank of Denver has paid out to depositors $900,000 within the last thirty days;the German National Bank of Denver one million dollars within the last sixty days, and that the same work is going on all over the country, we may realize how rapidly money is being withdrawn from circulation. Is there in Washington, or any other community, ten dollars obtainable for businessfuses now wheresixteen dollars could be obtained a year ago? If not, then there has been within the past year a practical, actual, disastrous contraction to the extent of six hundred millions of the nineteen hundred millions of dollars that constituted our circulation a year ago. It is to be hoped that the discerning public will see that the dangers which Mr. Birney imagines will result from a cessation of inflation are very minor matters compared with the that have already come upon us because of the pontraction born of the unwise inflation of the past. J. L. McCREERY.

3. July 21, 1893 The Roanoke Times Roanoke, VA

Article from The Roanoke Times, July 21, 1893

Click image to open full size in new tab

Article Text

SENSELESS BANK RUNS They Compel Denver Banks to Temporarily Suspend. DEPOSITORS WILL NOT SUFFER. The State Bank Examiner Thinks All Depositors Will be Paid in Full, as the Banks Are in Good Condition - The Scare About Over. DENVER, July 20.-The timorous feeling among depositors in the Denver banks, which has resulted in the closing of a number of these institutions this week, seems at last to have reached its limit, and the people are now stopping to think, with the result that yesterday afternoon more money was deposited than was withdrawn. The German, State and People's National banks closed their doors yesterday in order to forestall the heavy demands that it was evident would be made. As soon as the action had been taken depositors in other banks seemed to take new courage, and during the day talk on the streets was much more conservative and rational. The North Denver bank closed its doors late in the afternoon. There was no great run, but the bank had been unable to realize upon its securities and was short of funds. The depositors have been assured that they will be paid 100 cents on the dollar. During the afternoon the five national banks that are still open for business showed no signs of any unusual excitement among their patrons. Indeed, these banking houses were quieter than on many days during ordinary times, and everybody seems to feel that the end of the unjustifiable excitement has been reached. Following the suspension of the State and German National a few small depositors who had their money in the First National renewed the run on that institution, but it was a small affair and soon wore itself out. In two hours the run was completely broken and quiet was restored. The run was caused principally by those who werenear at hand when notices declaring the suspension of the German and State National were posted. These people at once became panic stricken, although the remarkably strong condition of the First National is a matter of common knowledge. Around the Denver National, Colorado National A Notional

4. July 22, 1893 The Carbon Advocate Lehighton, PA

Article from The Carbon Advocate, July 22, 1893

Click image to open full size in new tab

Article Text

SENSELESS BANK RUNS They Compel Denver Banks to Temporarily Suspend. DEPOSITORS WILL NOT SUFFER The State Bank Examiner Thinks All De. positors Will be Paid in Full, as the Banks Are In Good Condition The Scare About Over. DENVER, July 20.-The timorous feeling among depositors in the Denver banks, which has resulted in the closing of a number of these institutions this week, seems at last to have reached its limit, and the people are now stopping to think, with the result that yesterday afternoon more money was deposited than was withdrawn. The German, State and People's National banks closed their doors yesterday in order to forestall the heavy demands that it was evident would be made. As soon as the action had been taken depositors in other banks seemed to take new courage, and during the day talk on the streets was much more conservative and rational. The North Denver bank closed its doors late in the afternoon. There was no great run, but the bank had been unable to realize upon its securities and was short of funds. The depositors have been assured that they will be paid 100 cents on the dollar. During the afternoon the five national banks that are still open for business showed no signs of any unusual excitement among their patrons. Indeed, these banking houses were quieter than on many days during ordinary times, and everybody seems to feel that the end of the unjustifiable excitement has been reached. Following the suspension of the State and German National a few small depositors who had their money in the First National renewed the run on that institution, but it was a small affair and soon wore itself out. In two hours the run was completely broken and quiet was restored. The run was caused PAYMENT principally by those who were near at hand when notices declaring the suspension of the German and State National were posted. These people at once became panie stricken, although the remarkably strong condition of the First National is a matter of common knowledge. Around the Denver National, Colorado National, American National and City National banks all was quiet. There were very few calls for money, and a few of those who had withdrawn their money from the suspended banks were depositing in the banks that yet remain open. Among the officers of the banks which were open for business the expression was unanimous that the flurry was at an end, and that the people would now see the folly of their actions in forcing a suspension of the banking institutions by all withdrawing their deposits at once and taking from circulation all the money that would ordinarily flow through the regular channels and help in sustaining the business public and the banks. The suspended banks all had much more than enough money to be considered perfectly safe guaranty in ordinary circumstances and with business at Its normal condition would have laughed at the idea of a run. A tour of the banks just before their closing hour showed that all excitement had died away and there was not the least semblance of a "run." The officers of all the banks stated that they were taking in more money than they werepaying out. "I do not think I will have to place A bank in Denver in the hands of a receiver," said Frank Adams, the bank examiner for Colorado. Mr. Adams further said that he believed the suspended banks will all resume business in a short time. He has the clerks at all of the banks engaged in making out the reports, which will be sent to the comptroller as soon as they can be gotten ready. Mr. Adams seems to have the utmost confidence in the belief that the banks will reopen again in a few days, and that no losses will follow to depositors. The morning train from Omaha brought in $50,000 in cash for Denver national banks. Another bank last night received two iron safes full of money from the east by express. Owing to the tightness of the money market a large number of business houses in the city and state have made assignments. The Wheeler Banking company, of Aspen, Colo., closed its doors, and there was an exciting run on the First National bank at that place.

5. July 26, 1893 Watertown Republican Watertown, WI

Article from Watertown Republican, July 26, 1893

Click image to open full size in new tab

Article Text

WHIRL AT DENVER. Banks Suspend, Making Twelve Failures in Forty-eight Hours. ENVER, Col., July 19.-Three banks here this morning. Six closed doors yesterday and three susMonday, making twelve bank in this city in forty-eight hours. is on to-day to an extent perhitherto unknown in any city in West, and the financial and comsituation is of the gravest kind. old German National Bank, with eputation for stability of twenty standing, and the equally State National, failed to their doors for business morning. All night long destood in line in front of the and by 9 o'clock there was long sea of faces. At the opposite where the State National has SO done business, there was quite a of anxious depositors waiting the of the doors. Here the people relieved of their agony a few minafter 9 o'clock, when a nowas posted on the to the effect that the would not open owing to lack of ready cash, and the crowd away. At the German there evidently a determination to go with business up to almost the moment, when a slip of paper was on the window, stating that the would remain closed temporarily. the scene became distressing. and women down the long line out in tears and wailing. There run on every bank in the city. resident McNeil, of the State Bank, that his bank has paid out in cash a more than $900,000 within the last days. He vainly tried to call in loans in order to keep the doors but it proved to be an impossibilIn concluding a long talk, he said: say for me that our assets toare fully twice as large as our liaharles M. Clinton, cashier of the National, stated that the exdingly hard times and inability to securities, together with the failto call in loans had forced them to their doors. "During the last days," he said, "there had been a drain on the bank, and over 00,000 had been paid to depositors, days the demand being all the from $25,000 to $75,000." he bank expected $300,000 from the this morning, but it failed to arrive as they had paid out nearly all their during yesterday's run, they forced to close. The bank has very lenient with all its creditors never made an attachment until terday, which was against the Mouatt Company for $155,000, and this not done until absolutely necessary. president of the bank is John J. tham and its capital and surplus is Its officers expectit to resume as its assets are greatly in exof its liabilities. came the greatest crash of the when the People's National Bank its doors. The notice on its read: "This bank is closed by of the board of directors. Net $1,100,000; liabilities, $310,000." he Mercantile Bank, a private instiin the Mining Exchange buildsuspended late yesterday, owing to closing of the Union Bank, through its clearances were made. The Bank, another private concern, suspended in the afternoon because German National declined to help it The North Denver Bank also he People's National Bank closed at 'clock to-day. when President Law-

6. July 27, 1893 Burlington Weekly Free Press Burlington, VT

Article from Burlington Weekly Free Press, July 27, 1893

Click image to open full size in new tab

Article Text

WAILING DEPOSITORS. DLD RELIABLES OF DENVER CLOSE THEIR DOORS. With Abundant Assets the German National, People's National and State Banks Forced to Announce Empty Coffers-Other Banks Survive the Run and the Crisis Seems Past.