Colchester Savings Bank - Colchester, CT

Bank Information

Episode Type: Run → Suspension → Reopening
Bank Type: savings bank
Start Date: January 1, 1897*
Location: Colchester, Connecticut (41.576, -72.332)

Metadata

Model: gpt-5-mini
Short Digest: b244ea65

Response Measures

Partial suspension

Other: Court-issued restraining orders limited payouts (10%→15%→30%→40%) over several years to avoid asset sacrifice.

Description

A run occurred in 1897 during a local business depression, leading to a judicial restraining order limiting payments (a partial suspension). The order was modified repeatedly (1898, 1899, 1900, 1901) and further amendments in 1902 and 1903 increased allowable payouts; newspapers state the bank is solvent and expected to resume business. Dates for the original run and restraining order are given as 1897 (no exact day).

Events (4)

1. January 1, 1897* Run

Cause: Local Shock
Cause Details: Business depression in Colchester triggered depositor withdrawals in 1897.
Measures: Judicial restraining order issued (1897) limiting payments to depositors to prevent asset sacrifice.
Newspaper Excerpt: Because of the business depression in Colchester there was a run on the bank.
Source: newspapers

2. January 1, 1897* Suspension

Cause: Government Action
Cause Details: Judge's restraining order (court action) preventing full payment of deposits to stop forced asset sales during run; effectively a suspension of payments under court injunction.
Newspaper Excerpt: The first restraining order was issued by a judge of the superior court in 1897...the order issued in 1897 restrained the bank from paying out any money for a year.
Source: newspapers

3. March 18, 1902 Suspension

Cause: Government Action
Cause Details: Court-modified restraining order increasing allowable payouts to 30% for the coming year (modification of earlier injunction).
Newspaper Excerpt: An Order Providing for Payment of 30 Per Cent to Depositors...Mr Day moved for a modification of the order now in force against the bank, which restrains it from paying out more than 15 per cent to depositors in a year. He asked that the order be amended so that the bank can pay out 30 per cent to depositors during the coming year.
Source: newspapers

4. March 16, 1903 Suspension

Cause: Government Action
Cause Details: Further court order limiting payments to 40% and continuing injunction intended to prevent another run; indicates ongoing partial suspension with expectation bank will resume business next year.
Newspaper Excerpt: Judge Case this afternoon signed an order ... restraining the officials of the bank from paying out more than 40 per cent. of the funds or deposits and continuing in force the injunction brought to prevent a run on the bank.
Source: newspapers

Newspaper Articles (2)

1. March 18, 1902 Waterbury Democrat Waterbury, CT

Article from Waterbury Democrat, March 18, 1902

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Article Text

COLCHESTER SAVINGS BANK. An Order Providing for Payment of 30 Per Cent to Depositors. Hartford, March 18.-Edward M. Day, representing the Colchester Savings bank, and George F Kendall and Charles H. Noble, state bank commissioners, appeared before Judge Case at the county building yesterday morning. Mr Day moved for a modification of the order now in force against the bank, which restrains it from paying out more than 15 per cent to depositors in a year. He asked that the order be amended SO that the bank can pay out 30 per cent to depositors during the coming year. The state bank commissioners made no objection and said that the officials of the bank had conducted the business in a very satisfacory manner. The order now in force against the bank does not expire until March 24, and after that date the new order will become operative. The first restraining order was issued by a judge of the superior court in 1897. Because of the business depression in Colchester there was a run on the bank. The bank had sufficient assets to meet all liabilities, but a continued run would have made it ne+ cessary to dispose of many of the àssets at a big loss to the bank, and the bank commissioners at that time were of the opinion that an order restraining the bank from paying out deposits should be made. The order issued in 1897 restrained the bank from paying out any money for a year. _In March, 1898, the order was amended SO that 10 per cent could be paid out, and the order of March, 1899, provided for a similar payment in that year. The payment was increased to 15 per cent by the order of 1900, and a 15 per cent payment was made under the order of 1901 Under the order passed yesterday, which will take effect on March 24, depositors will be entitled to 30 per. cent of their deposits. The bank is solvent and has assets to more than pay depositors. The action was taken in 1897 to prevent a sacrifice of the assets. Many of the assets are loans on real estate and could not be realized on readily. At the time the original restraining order was passed the bank had more than $200,000 on deposit and when payments are made under the order made by Judge Case yesterday there will be less than $70,000 remaining, There is no danger that the depositors will suffer any loss because of the temporary embarrassment,

2. March 17, 1903 The Daily Morning Journal and Courier New Haven, CT

Article from The Daily Morning Journal and Courier, March 17, 1903

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Article Text

Colchexter Savings Bank Case. Hartford, March 16.-Judge Case this afternoon signed an order in the superior court in the Colchester Savings bank case restraining the officials of the bank from paying out more than 40 per cent. of the funds or deposits and continuing in force the injunction brought to prevent a run on the bank. It is thought that the bank will be able to resume business next year.