14193. Newark Bank (Newark, NJ)

Bank Information

Episode Type
Run → Suspension → Closure
Bank Type
state
Start Date
October 31, 1881
Location
Newark, New Jersey (40.736, -74.172)

Metadata

Model
gpt-5-mini
Short Digest
4e844873

Response Measures

Accommodated withdrawals, Full suspension

Other: Receivership/appointment of a federal receiver mentioned by Comptroller; cashier arrest and criminal charges described.

Description

Contemporary reports describe a run on the Newark Bank in late October–November 1881 precipitated by large misappropriations by the cashier (Baldwin) and his loans to C. Nugent. The bank suspended (reported Oct 31, 1881) and the Comptroller/receiver was reported to be appointed shortly after; articles describe arrest of the cashier and the bank as failed. Classified as run → suspension → closure (receivership). 'Newark Bank' appears in sources as the institution name; OCR errors in Article 2 were corrected (e.g., 'Baldwin', 'Nugent', dates).

Events (3)
1. October 31, 1881 Suspension
Cause
Bank Specific Adverse Info
Cause Details
After discovery of large loans/misappropriation by the cashier (Baldwin) and inability to meet obligations, the bank decided to suspend payments on Oct. 31, 1881 according to dispatches.
Newspaper Excerpt
The Newark Bank yesterday ... decided to suspend.
Source
newspapers
2. November 2, 1881 Receivership
Newspaper Excerpt
The Comptroller of the Currency to Appoint a Receiver for the Newark Bank.
Source
newspapers
3. November 18, 1881 Run
Cause
Bank Specific Adverse Info
Cause Details
Large misappropriations/unauthorized loans by the cashier Baldwin to C. Nugent led to loss of bank funds and depositor withdrawals.
Measures
Other banks sent cash (about $30,000) for depositors; presumed protective deposits and attempts to shore up liquidity.
Newspaper Excerpt
The run on the Newark Bank continues, and about $30,000 in cash was sent over from here yesterday for depositors.
Source
newspapers

Newspaper Articles (5)
1. November 1, 1881 The Evening Critic Washington, DC
Article from The Evening Critic, November 1, 1881

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Article Text

Current Rumors in Wall Street. Special Dispatch to THE EVENING CRITIC. NEW YORK, Nov. 1.-The more conservative bankers at the Windsor said last night they thought the effect of the Newark Bank failure was of less importance than many imagined, and the depression in stocks was more directly chargeable to the natural stringency in money for November settlements than to anything elsc. A good many loans were consequently called in, and a considerable quantity of funds had gone into the city treasury for taxes. About $17,000,000 is to be disbursed here to-day. It was reported that the defaulting cashier of the Newark bank had lost most of the bank's money in discounting notes, a great deal of it having been paid to Nugent & Co., who were endeavoring to sell down all the other Morocco manufacturers in the United States. A portion of the funds.was lost, however, in bearing the Chicago grain market. Little or none was lost in Wall street. The other Newark banks fortified themselves against a possible run to-day. The Fourth National, of this city, sent one of these institutions $50,000 in notes last night for this purpose: Seligman & Cd. report great improvement in affairs in Paris, and, although there is still great inflation in values, matters look much better. Sterling is down to 21) francs, against 25 francs. Money has loaned as high there as 24 per cent. per annum on good stocks. The Gould-Sage Metropolitan Elevated Railroad faction were before the Stock Exchange list committee, yesterday afternoon, with an application to have the assented stock admitted. The opposition, representing $40,000 shares, opposed the admission, and the chances are against the stamped securities being allowed on the list. The brokers say that the largest room traders have apparently sold out their long stocks and have switched over to the bear side; also that the street was decidedly bearish late in the day. The bears insist that there was good selling of stocks from noon until 3 o'clock, and that the bull movement has culminated. The story was reported last night that Sammy Tilden had sold out the last of his U. P., but the bulls in it deelare that the investment demand front the Astors and their friends has absorbed very much of it. The new fast palace-car train over the New York Central, with dining-room cars attached, will begin to run on Monday or Wednesday next, leaving, here at 5:30 m. one day and arriving at Chicago at 6 p.m. the next day. The Vanderbilt railroad people insist that the war is by no means settled, notwithstanding the advanced rates, and if the Baltimore &POhio, Pennsylvania Central or Erie cut the no# figures; orders have been given to the Lake Shore, Missturi Central and New York Central Railroad Compatiles to meet them at once. They also say that while Mr. Vanderbilt has not recently been buying any stocks, he certainly has sold none, and he has not advised his friends to sell short. Mr. Chase, the principal owner of the celebrated Jummel estate, denies that this property has been sold, but is willing to dispose of it. There are over 100 lots and $1,000,000 is bid for the whole property. It will probably fetch $1,500,000 Mr. Sage said last night he thought the full effect of the Newark Bank disaster had been discounted yesterday, and the market would be strong and higher all around this afternoon. There is a new and powerful bull party in Texas Pacific for sixty this week.

2. November 1, 1881 Sacramento Daily Record-Union Sacramento, CA
Article from Sacramento Daily Record-Union, November 1, 1881

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DOMESTIC The Newark Bank Failure NEW YORK, October 31st. The the Cashier the Newark Bank yesterday told that debt. They ibe half mill millions he dollars, but not do it, and decided to suspend. The that the deposits President Halsey $2,417,000 and Cashier Manage and Oscar the for Baldwin thund clap like trouble the deemed the and the officers most while high financier. and The New for York loses nothing, having fused to allow to withdraw his were who Nugent latera Other ended. with fail bank, the that stated the the bank are the buildings worth $50 000 warrant CHICAGO, arrest the had used The funds. $2,000,000 wildest The Cashier the but unlimited was fidence the Bank Board Water where that that but the The bank Mutual $900.000 400.000, believed that saved. is NEWARK October 31st Cashier Baldwin of the Mechanics Bank while confined his residence, was waited upon by United States District Attorney and Keesby and admitted to bail in $25,000. appear at Court His bondsmen are A Freeman. of Bloomfield, his brother. Wm Baldwin and Matthias Dodd, of East Orange stated about voluntarily that Baldwin then 1873 he began to make loans to C. Nugent manufacturera without the hav sanction Directors, curity the ing begun he was in the power of Nugent the continued and times loaning them $50,000 in one month till total the Nugent assured him that he had large prop which cash in assets the business, and erty all loans would the make he that (Baldwin) the money and bank's using his in case property Under these the trouble. any $2,000,000. The reached loan manner which this business drafts thus Nugent uid give friends be would to Baldwin would use the drafts when take the due. be the Finally, loans placed in the account of it the the truth $200,000 The District held to be Section under the United States Revised Statutes. the about about At beginning sinca position life Mutual the The Life annual dividend of the bank was for per cent. The stockholders of the bank are liable for That is for $100 must pay $100 stock. besides The Bank arriv the with the aid of the clerks can been been dispre cerning any other The will oubtedly be de veloped organized Bank The is it loss, national 000 believed, Nugent only portion of small $160,000 the Then there is hand, under of bills esti mated llar Baldwin fifty fried, Joseph Brewer the largest confess Nugent judg ment on his ind liest the period was when the Directors had tion affairs of the The first was by Baldwin addition to those befor among the are F. F. Frelinghu and Kenney T. T DISPATCH. [FOURTH NEWARK October Baldwin reste bed o'clock this morning. He showed and idently ing the arrest. He said he would not bail, and content to pass his life in prison never be seen on Broad street The business of the morrocco firm of C Nugent said amount to $100.000 s year They 600 men, and the weekly 900. to pay When Baldwin was before us, said a he appeared Director porter, clean breast of the matter He said he fully realized the grave nature of the offence. and admitted that he ought to be dealt with in the severest manner the law There's allow my would misdeeds, he said, and I now what should have years ago. stand befor you to-night perjurer, forger, falsifier and criminal think. gentleman. he said in conclusion, that you ought to send for officers, and but meunder arrest for misappropriating your money. and money belonging to other persons. your duty to send me to jail, and only ask the privilege of going home to inform my wife and family of my misdeeds. They know nothing about this affair never expect to go to the bank again. but instead expect go to jail. and from there to the State Prison, and there I will have to end my days. If I had not been much of coward. would not have been here tell you this story -night. should have shot myself Since have chosen to live. must suffer Shortly after the last statement of the New ark Bank was published peculiarity in it the attracted the attention of the officers of It Mechanics' National Bank of this city was observed once by the officers other banks Newark who wondered at the state ment, but could not prove false. The Star Route Cases- Williams' Report. NEW YORK. October 31st The following in Williams' report published for the first time oute 46 129. originall running from Delano to Los Angeles, F nine months the D partment paid the tractors 123 miles at the rate of $15. 427 94 per annum, when railroad was in opera-

3. November 2, 1881 The Dallas Daily Herald Dallas, TX
Article from The Dallas Daily Herald, November 2, 1881

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ELECTRIC FLASHES. It is Rumored Gladstone Will Resign the Chancellorship of the Exche. quer and Retire from Public Life. Washington Brokers Make Large Purchases of Confederate Bonds to Supply Demand From England. The Public Debt Statement of Last Month Shows a Decrease of Over $13,000,000. The Comptroller of the Currency to Appoint a Receiver for the Newark Bank. A Cowardly and Inexcusable Assas. sination of Negroes in Mississippi. The English Making New Dispositions of Troops in View of an Emergency.

4. November 19, 1881 The Evening Critic Washington, DC
Article from The Evening Critic, November 19, 1881

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ANOTHER good bank gone wrong. The Pacific National Bank, of Boston, has suspended. And thereby hangs a tale. This is the second instance with in a very few weeks where national banks of supposed back-bone have suddenly Wtakened. Why is this? In some respects the case of the Pacific National is worse than thar of the Newark Bank. There seems to have been no cashier in the former case who "removed" some two millions which can't be accounted for, but the scientific business misman agement of the Pacific will strike the obs erver as marvelous. How it could have continued so long is a mystery. From its birth this bank appears to have enjoyed no clearing-house privileges, all its drafts and checks being managed through the proxy of another banking firm. Ex. cept so far, therefore, as the reputable standing of the proxy went, no one dealing with the Pacific could at any time swear as to credit and stability. In the face, however, of this well recognized fact in the mercantile world, Boston capitalists kept on with their Pacific deposits up to the very moment almost that the suspension was announced. The direct reason assigned for the failure is a heavy overdraft by Weeks, the broker, which was met no doubt as the drafts on the Newark Bank were met, on the principle that a rule once violated will have to be stretched till it breaks. Overdrafts should never be allowed without the deposit of collateral. This is demanded by the pledged faith of the bank. But another element enters into the problem. The Treasury carries on its rolls a number of alleged bank examiners. Their business is to keep informed on the credit and standing of banks using the national currency, The expert assigned to the Newark district never discovered straw credits to the extent of two millions till the crash came, and the Boston expert will now proceed to hold a post-mortem examination on the body of the Pacific National. We move, therefore, if we can obtain a second, that the present corps of bank examiners be placed on the retired list, and that we try to secure the services of examiners who will examine before the death of the patient is announced.

5. November 19, 1881 National Republican Washington, DC
Article from National Republican, November 19, 1881

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MINING STOCKS. 141/2 Quicksilver 11/4 Arizona 61% 2 Caribou Quicksilver pref. 23 Standard 17 Homestake 11/6 2 Sutro Tunuel Little Pitts 834 Robinson Mining 351/2 Ontario Silver. GOVERNMENT BONDS-CLOSING QUOTATIONS. 1011/@101% United States 6 per cent. extended 102 @10216 United States 5 per cent. extended @112% United States 41/6 per cent. registered 113% @11316 United States 41/2 per cent. coupon 1163.0 117 United States 4 per Cent. registered 116% @117 United States 4 per cent. coupon 116% Sales United States 4 per cent. C. L 107 District of Columbia 3.65s. BANKERS' EXCHANGE. 4811/2 485% I Sixty-day bills Three-day bills WALL STREET GOSSIP. NEW YORK, Nov. 18, 10:10 a. m.-The bulls in the stock market last night were generally anticipating another upward turn in Lake Shore to-day, but there was little said about anything else. The operations of the Vanderbilt people was regarded as past finding out, but if funds become easier the tendency would probably be upward again. Mr. Gould and Connor were talking bullish at the Windsor last night, especially on Western Union and Misscuri Pacific, but it was the average impression that Gould would not attempt to promulgate much of an upward turn again until Keene had liquidated. Cammack and Hutchings say that the present movement is merely a Keene market, but Keene's friends say that he denies being the large buyer of Lake Shore yesterday. Hutchings says he personally is out of the market. but he thinks it is going down, especially the Vanderbilts. George Chase and W. M. L. Scott are likewise out of the market, and are merely lookers-on. The Windsor Hotel bear party, including Park, Cammack, Smith, and Mills, still predict a lower market. and believe that money will continue to work closely until the end of the year. Sage also still talks the market down. It is said that the Importers and Traders' Bank called in loans largely. A private Washington dispatch was recelved at the Union League Club last night stating that while Secretary Folger was very reticent regarding the new plans for relieving the money market, the fact had leaked out, however, that a draft of his new policy had been made and submitted to the President. The Northern Pacific directors at their meeting last night came to a conclusion. but it was subsequently stated that no action regarding dividends was taken, and this caused the slum in the market later in the day. Park & Mills declare that there is no hope for the Pacific Mail, as the railroads will not allow It living rates, but there is more than a suspicion that this story is all a dodge, and if the steamship company sell the road its China steamers harmony will again prevail, and the South American business will be declared sufficiently remm erative to permit dividends upon the Pacific Mail stock. The new Hannibal and St. Joe say that this company has $350,000 In cash on hand, and that the concern is In excellent financial condition. The run on the Newark Bank continues. and about $30,000 in cash was sent over from here yesterday for depositors. The bank is sound. It is announced this morning that the Northern Pacific directors left the dividend question to a finance committee to decide upon. Joe Mills says the ten thousand shares bought yesterday by Hollins were for Henry N. Smith, who is now covered up. Cammack also covered up his shorts through Coombs. 12 m.-The market has sold off on reports of bank failures in Boston. Private dispatches from there state that the Central and Pacific banksare in trouble, and that they have been carrying large amounts of new securities for a prominent speculator there. They are small concerns, with a capital of $500,000 each. 1:30 p. m. A Boston telegram says there are many rumors in circulation there respecting the standing of two or three small city banks, but the only one which appears actually embarrassed is the National Pacific, small concern of 8250,000 capital. The Elliott Bank of Boston, which clears for the latter, threw them out this morning. The correspondents here were the Continental National, but President Randolph, of the latter, denies that they are now acting as such. It t was reported that the Citizens' and also the Central Banks of Boston were likewise in trouble, but the ree ports were unfounded, and the Boston people attach no importance to the Pacific Bank matter. 2:30 p. .-Money loaning at 6 1-64 cents interest.