1830. Washington Loan & Trust Company (Washington, DC)

Bank Information

Episode Type
Run Only
Bank Type
trust
Start Date
November 17, 1906
Location
Washington, District of Columbia (38.895, -77.036)

Metadata

Model
gpt-5-mini
Short Digest
1e71e9c887ec2858

Response Measures

None

Description

A depositor run occurred 17 Nov 1906 driven by a groundless rumor/confusion with another similarly named institution. The bank paid withdrawals, directors and government examiners publicly reassured depositors, and business resumed; no suspension or receivership followed.

Events (1)
1. November 17, 1906 Run
Cause
Rumor Or Misinformation
Cause Details
A confusingly similar-named institution and a woman's complaint at the Pension Office led to a magnified rumor that the Washington Loan & Trust Company could not pay, prompting depositors to withdraw funds.
Random Run
Yes
Random Run Snippet
Rumor confused with similarly named institution; examination showed false
Measures
Directors posted a statement; bank examiners and officials (acting controller, examiners, clergy) publicly reassured depositors; withdrawals were paid promptly and depositors later redeposited funds.
Newspaper Excerpt
A run being made on the Washington Loan and Trust Company...the run was caused by the complaint of a woman who had money in an institution with a name somewhat similar to the Washington Loan & Trust Company and was unable to get it at once.
Source
newspapers

Newspaper Articles (12)
1. November 17, 1906 Evening Star Washington, DC
Article from Evening Star, November 17, 1906

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in you have of According Washington the the of laws District as not Columbia, maintrust a company. its but tain last you 12, financial of you see will November in of than more $76,000 profits." undivid Reassuring to Statements. the same effect general by by B. H. were made Father Stafford, and Warner others. in seen office When Edson President the apdeeply affected obviously in the institution. he of confidence the and rumor the only reason "At our last was an that made declare of parent was lack repeated of for the the panicopistic a be the one trust this said company by this (and was morning 'but Mr. Edson), President the to increase in the increase $1,000,000 tion has before been profits." there distribution All Satisfied. Applicants at the the were When closed of at end the regular business bank do gaturday in 200 noon there about persons of All in were line. settled and any that made to could desired money do SO others full, on who Monday. Utmost Surprise Expressed. in all and fact Among among bankers. of any the who have classes knowledge of in this condition financial Institutions is the city, that utmost surprise expressed in the of run have nature anything in of the any case occurred Institution It was difficult deposits. an receivinghave appreciato of tion of realize anything the kind here for men the situation could a is It that what curious has the been most examiof the of the nation institu stitutions perhannancial by has city that the been conmade of the has been just comtroller currency pleted. of the This into banks affairs examination of was one most made in competent the men bank experts, treasury and the to were highly the creditable the as to well condition of the institudo The and ComTrust Management of the has being pany managed in the its and most manner, conservative as cash ammost upon reserves e looked an As of ple. the confidence Illustration is the in of which this stability it is of said that president one Institution, this banks leading of of the one large him notifying if of that department Loan and were Trust check presented be he would responsible morning of to stores the head in the the during day he they that said were personale would cashed to up that offer make good $100,000. and Senseless. T. P. Unnecessary of the curKane, acting controller a in an with Star rency, reporter interview the this made afternoon to as the the that announcement Washington and was Trust Loan Company "unnecesMr. not did sary Kane consenseless." to a formake sider said, sider it mal conceive Washi should the be suspected of Mr. possible state and it atement, necessary. that so as Loan strong he he of could and being an Trust institution in Company a weak said, Kane of the re fact" was never bank condition "As examiner a matter made one an month ago, in better in call for thing. ever ported institution "our The the Statement of In the a fact, few made days the statemeweshington last night answer ago condition shows to is our considered same Loan the and best Trust Com- and to pany. by "I the have allay done the all I uneasin I think could. that that by that seems Monday they and existed, to and will be ashamed asill last night me up many people the people have with their about I have today doubt bank. and. inquired called told voices them of that solid on the showing the bancider I have financial the trust institutions one in the today whole United the most States. Denial of Weakness that the an that inarose its "I understand from somewhat statement similar affairs. Some- name the conflicted and few talking was stitution thing preparing with to the wind name up Trust with Company that of about and of The but Washington on body Loan people that were company. few people to in a condition yesterday. they would amount depositors any idea I am surprised not better they could anything had are If they were busy rumor the started that fear. that kept informed as not in the to possibly its affairs. by have Mr. calls any Kane, as he to was the was condition great to today As stated answering bank, he and gave each Institution's unequivoca time there weakness. denial persons rellet of the when of the were A numthe stories of the inquiries department of engraving hard the by Many govern Government in bureau hit pretty here, and there fallusomething and ber in the of printing persons were of recently savings like bank small Danic was (Continued on Second Page.)

2. November 17, 1906 Evening Star Washington, DC
Article from Evening Star, November 17, 1906

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Beginning of Run on Washington Loan and Trust Company. MANY DEPOSITORS WITHDRAW MONEY Acting Controller Says Alarm is Unnecessary and Senseless. Statement by T. P. Kane, Acting Controller of the Currency: "The uneasiness as to the Washington Loan and Trust Company is unnecessary and senseless. Our examiner made an examination of the institution about one month ago, and reported that the concern was never in better condition. The statement of the bank a few days ago shows the same thing. In fact, the statement is considered the best ever made by the Washington Loan and Trust Company. By Monday the people will be ashamed that they ever doubted the company. I consider this trust company one of the most solid financial institutions in the United States." Father Stafford: "All my church money is on deposit with the Washington Loan and Trust Company, and it will stay there." By he Directors of the Washington Loanand Trust Company: "The institution was never in such sound and safe condition as at the present time. We assure all concerned that their money and property intrusted to our care are perfectly safe."

3. November 17, 1906 The Washington Times Washington, DC
Article from The Washington Times, November 17, 1906

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A statement alleged to have been made yesterday by a woman employe of the Pension Office that she could not draw her money from a Washington loan company, grew, and was magnified until this morning it resulted in a run being made on the Washington Loan and Trust Company. Shortly after doors were open this morning an unusual number of customers filed into the bank office, and began to draw out their deposits. Realizing the harmful effect of the rumors, John Joy Edson, president of the Washington Loan and Trust Company, called a conference of the directors, and went over the situation with them. A statement, signed by the directors, was then issued and posted in full view of the crowd. The statement had a tendency to reassure the depositors. Owen T. Reeevs, jr., national bank examiner, who several weeks ago made a thorough examination of the company's books, mounted a chair and in a short sepech told the depositors that there was no occasion to be alarmed. "This bank is as solid and sound now," said Mr. Reeves, "as it has ever been. Its assets are greater at this moment than at any other time since the organization of the company," The crowd applauded and some turned and left the building. Others, however, remained and presented checks for their balances. A gratifying incident in connection with the run was pointed out by Mr. Edson. At the paying teller's window there was a string of people that extended into the street, and at the receiving teller's window on the opposite

4. November 17, 1906 Alexandria Gazette Alexandria, VA
Article from Alexandria Gazette, November 17, 1906

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From Washington. (Correspondence of the Alexandria Gazette.] Washington, Nov. 17. A run on the Washington Loan and Trust Company created considerable excitement this morning. A bank examiner, B. H. Warner and Father Stafford talked to the excited depositors from a table, telling them that the bank is one of tae salest institutions in the country and there was no danger. Father Stafford said all the church money was there and he was not worrying. The run was caused by the complaint of a woman who had money in an institution with a name some what similar to the Washington Loan & Trust Company and was unable to get it at once. An examination ordered by the Comptroller of the Currency showed the bank to be perfectly solvent. The "insufficient funds" referred to her own RCcount. The Newfoundland government, in pursuance of its determination to contest the legality of the modusvivendi entered into between the United States and the British government which conflicts into its own fishing law and restructions regarding the fishing by American in Newfoundland waters, has taken steps to put the matter to a test. The State Department has been informed that two colonial fishermen, Baits and Crane, have been arrested tried and convicted of having. in violation of the bait act, put herring on board the American vessel, Ralph Hall, and of having shipped aboard that vessel outside the three mile limit. They were fined $500 each with the alternative of serving three months in prison Bond was given for the men by counsel and an appeal will be taken to the Supreme Court. At the State Department this morning it was announced that this attitude of Mr. Alexandria was taken under instrnerious from the department itself. In a formal statement issued this afternoon Secretary Shaw, of the Treasary Department, announces that he is in entire sympathy with the general plan for elastic currency adopted by a special committee of the American Bankers' Association in this city. He says "he will be pleased beyond measure if Congress will adopt every detail of the plan." He says if Congress determines to add an elastic feature to the currency system, there should be no doubt of favorable results in a short time. Capt. Carl Reichman, 17th Infantry, will probably be called upon by the Secretary of War to explain the statement made by him in It letter to a New York friend published this morning that he has been debarred from the United States army general staff because of his German birth. He insinuat's also, much to the surprise of his brother officers at the War Department that he has been in dis. favor because he is not an "Anglomaniae" and a "Japanesemaniac." The reference made by Capt. Reichman in his letter to the close relations between the United States an Japan are considered serious by officials of the War Department. It is declared that there is ab. solutely no foundation in his statement that be has been kept out of the general staff because he was born a German and once served in the German army.

5. November 17, 1906 Evening Star Washington, DC
Article from Evening Star, November 17, 1906

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A Senseless Bank Run. A striking Illustration of the folly of "running" a bank is afforded by today's experience of the Washington Loan and Trust Company. "This institution is not only thoroughly sound. but it is distinguished in local financial circles for its exceptional conservatism of management. A bank less likely to subject-itself by its methods to public suspicion is difficult to find. Yet on the strength of a rumor, said to be based upon a confusion of names, that The Washington Loan and Trust Company was in straits, hundreds of depositors this morning presented themselves with demands for the repayment of their deposits. The fact that they were promptly paid and that they were assured that the bank was in sound condition, having just passed the close scrutiny of the controller of the currency. had no influence for a time in checking the tide. Conditions were never less suggestive of financial stringency in Washington. There was never less reason for public doubt as to the soundness of the local financial Institutions of good standing. Yet, without pausing to inquire into the reasonableness of the reports, and without thinking of the absurdity as well as the possible danger of starting a run upon an institution of such generally recognized conservatism and strength, these depositors poured pell mell into the bank with their pass books and Insisted upon withdrawing their deposits. It is to be hoped that this groundless, senseless run will teach its proper lesson to the people of Washington, who are safeguarded in their financial affairs as are few communities. Those who without the slightest reason circulated the reports that precipitated the run have cause to reflect upon the responsibility that attaches to gossip prejudicial to the soundness of financial institutions.

6. November 18, 1906 The Washington Herald Washington, DC
Article from The Washington Herald, November 18, 1906

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sively "losing their heads" without rhyme or reason. Assistant Comptroller Reeves, of the Treasury; Rev. Father Stafford, of St. Patrick's Church; Director B. H. Warner, President Edson himself, and others addressed the crowd during the morning, all assuring the depositors of the absolute safety of their money. Father Stafford appealed to them in eloquent manner, urging them not to be disturbed. "All of my church money is on deposit here, and will stay here," said he. Meanwhile, throughout the city, checks on Mr. Edson's company were cashed without a moment's hesitation, and citizens and firms who have not done business there announced their intention of opening accounts to-morrow, simply to show their faith and confidence. Mr. Edson and his associates, from morning until night, received generous and substantial testimony of the high regard in which they are held in Washington. A Conservative Institution. The Washington Loan and Trust Company has always been managed in the most conservative manner, and its cash reserves are looked upon as most ample. As an illustration of the confidence which is entertained in the stability of this institution, the president of one of the leading banks telephoned to the head of one of the large department stores, notifying him that if any checks of the Washington Loan and Trust were presented during the day he would be responsible personally if they were cashed. He said that he would make that offer good up to $100,000. Among bankers, and in fact among all classes who have any knowledge of the condition of financial institutions in this city, the utmost surprise is expressed that anything in the nature of a run could have occurred in the case of any institution here receiving deposits. It is a curious circumstance that what has been perhaps the most rigorous examination of the financial institutions of the city that has ever been made by the Comptroller of the Currency has just been completed This examination into the affairs of banks was made by one of the most competent men in the force of Treasury bank experts, and the results were highly creditable to the management, as well as to the condition of the various institutions. Statement by Directors. During the morning the following statement was issued by the directors: "In view of rumors resulting from an error in confounding this institution with another, we desire to assure the stockholders, depositors, and patrons of the Washington Loan and Trust Company that it was never in such sound and safe condition as at the present time. Attention is invited to its statement just made to the Comptroller of the Currency, which is published in the press. "We assure all concerned that their money and property entrusted to our care are perfectly safe. "Charles B. Bailey, A. L. Barber, William E. Barker, John Cammack, John R. Carmody, Augustus Crane, jr., J. J. Darlington, James T. Du Bois, John Joy Edson, A. P. Fardon, John A. Hamilton, Philip Hichborn, John A. Johnston, Martin A. Knapp, John B. Larner, W. A. Mearns, H. D. Mirick, Watson J. Newton Theodore W. Noyes, Samuel L. Phillips, N. H. Shea, Louis P. Shoemaker, Thomas W. Smith, Ellis Spear. John A. Swope, George Truesdell, B. H. Warner, A. A. Wilson. A. S. Worthington, H. K. Willard, directors. Acting Comptroller T. P. Kane, in addition to the brief statement herewith printed, had this to say in further emphasis of the senselessness of the "run:" Never in Better Condition, "As a matter of fact, our examiner made an examination of the institution about one month ago, and reported that the concern was never in better condition. The statement of the bank in answer to our call for a report a few days ago shows the same thing. In fact, the statement is considered the best ever made by the Washington Loan and Trust Company. "I have done all I could to allay the uneasiness. All last night and throughout to-day people have called me up on the telephone, and, with their voices showing great uneasiness, inquired about the bank. I have unheasitatingly told them that I consider the trust company one of the most solid financial institutions in the United States. "I understand to-day that the whole thing arose from a statement that an institution with a somewhat similar name was preparing to wind up its affairs. Somebody conflicted the name with that of the Washington Loan and Trust Company and in a few hours people were talking about the condition of that company. The rumor started yesterday, but few people had any idea that they would amount to anything. I am surprised that depositors in the institution are not better informed as to its affairs. If they were they could not possibly have any fear. REPORT OF THE CONDITION OF AND TRUST

7. November 18, 1906 The Washington Herald Washington, DC
Article from The Washington Herald, November 18, 1906

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An extraordinary spectacle was witnessed yesterday in a "run" on one of the soundest and safest financial institutions in the country, the Washington Loan and Trust Company. No less extraordinary was the reassurance that came promptly from all quarters-even from the government itself, through high officials-to quiet the alarm of excited depositors. Such a tribute to a financial institution has seldom been paid anywhere; and this may be, in fact, the only instance where the United States Treasury, speaking directly through officials of the Comptroller's office, in person and on the scene, has so quickly and unreservedly vouched for the soundness of a banking or trust company. In addition to this, all the other banks in Washington offered aid in any amount needed, and not a few of them even went so far as to refuse to open accounts with the excited people who, wholly without cause, were impetuously withdrawing their deposits from the Washington Loan and Trust Company. Money Offered in Over-abundance. Money enough to pay all the depositors two or three times over would have been immediately available had it been required. But the withdrawals were well offset during the "run" by new deposits from substantial individauls and concerns who took this practical method of demonstrating their confidence in the institution. Mr. John Joy Edson was fairly overwhelmed all day by kindly expressions and generous offers of assistance, These came not only from Washington, but from the great financial center in New York. A confusion as to name, it appears, invelving a loan concern where there was delay in paying a check, started the mischievous rumor on Friday. Whatever the origin, it spread through the Pension Bureau and an incipient "run" began that day. When the company's doors opened yesterday morning it was renewed in increased proportion. It was wholly unaccountable to those who understood the sound condition of the Washington Loan and Trust. Its last report, just published, was so exceptionally fine in its showing that the "run" was all the more puzzling. It was simply a case of depositors impul-

8. November 18, 1906 The Washington Herald Washington, DC
Article from The Washington Herald, November 18, 1906

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Washington Loan and Trust Company. Nothing quite so causeless, SO wholly without reason, has happened in the financial history of the Capital as the "run" yesterday on that sound, wellmanaged institution, the Washington Loan and Trust Company-all due to a mischievous rumor that had no basis of fact. Human nature is the same here, there, and everywhere. There is no use to editorialize on the subject. The thing has happened before and may happen again. No financial concern is immune. Human nature cannot be changed; we can only deplore it, and hope that such a thing will not occur in this city again. But, deplorable as such a "run" is, there is a good and a helpful side to it. The frightened depositors know more to-day than they did yesterday. Their groundless fears have enabled them and the whole community to learn how strong and prosperous and reliable the Washington Loan and Trust Company really is; how large a surplus it carries; what the government thinks about its soundness, and, best of all, what the substantial people of the Capital think about it and its officers. The depositors should have known all this before-an examination of the company's reports would have told them enough-but now this unfortunate episode has forced the knowledge upon them in a manner they cannot forget. Mr. John Joy Edson's name speaks conservatism and honorable dealing. Money in an institution over which he has supervision is as safe as human agencies can make it. He and his associates had earned the fine tributes of faith and confidence which spontaneously came forth in consequence of this senseless "run"-tributes that would have carried with them funds to any amount had such been needed.

9. November 19, 1906 Evening Star Washington, DC
Article from Evening Star, November 19, 1906

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LOCAL FINANCIAL NEWS. Trading smaller in volume than that which was recorded on Saturday in the case of the common stock of the Washington Railway and Electric Company occurred today at the meeting of the stock exchange. The quality of it, however, was much the same, especially of that which took place soon after the stock was called. The bid began at 30% and rapidly rose to about the level of Saturday, and was brought quite up to the highest point of that day by the bid of 40. This latter came from the broker who had taken a large block on Saturday at the advanced-figures and he bonght quite freely at 40 until he had acquired several hundred shares. Then there was some buying at the same level on the part of those who sold options at an advance of half a point. The buying. however, at that price was not sufficient to take all the stock that was for sale, and so at the close the asking price was still 40, while the bid was only an eighth of & point below that level. There was not much interest taken in the balance of the list and the trading did not amount to much. It was not to be expected that the ridiculous run on the Washington Loan and Trust Company should be reflected any way in the current business on the stock exchange. In the buying and selling of stock there is always some motive behind any movement which indicates, at least, intelligence of what is being done and some coherent plan. There was nothing of this in the case of the late action of some of the depositors of the trust company. They had no reason to doubt the solvency of the institution which they thus attacked, and there is no explanation of their conduct except that which may account for the course of a crowd in a panic. On Saturday when the stock of the Washington Loan and Trust Company was called the same bid was repeated that has been current in this stock for some time, and which is renewed generally from day to day, for there is not much activity in it, owing to the fact that it is strongly held. None of the stockholders saw any reas n to part with their holdings, and those who wanted to. buy were perfectix willing to give 217, just as they had been the day before or at any other time. Today when the stock was called the bid for it advanced to 218, but there was no. stock offered for sale at less than 225. Some Union Trust Company stock sold for 139% and one lot at 140, but the buying was not brisk enough to take all the stock that was to be had at 140. Today's Government Receipts. National bank notes received today for redemption, $625,570; government receipts from internal revenue, $1,741,084; customs, $774,290; miscellaneous, $217,515; expenditures, $1,790,000.

10. November 20, 1906 The Washington Times Washington, DC
Article from The Washington Times, November 20, 1906

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RAILWAY COMMON ON UP GRADE Excellent Prices Paid to Secure Washington Loan and Trust Stock. Features of Today's Market Most Active Stock. Wash. Railway common 450 shares Greatest Net Gain. Wash. Loan and Trust 2 points Total Dealings. Stocks 571 shares Bonds $1,000 Two features stood out prominently today in the business on the Washington Stock Exchange. First, because of the great public interest centered in the hysterical run on the Washington Loan and Trust Company it was expected that it might be reflected in the price of the stock. The first sale that has been made for nearly a month took place today and the price was several points in advance of the last quotation with the demand well distributed and strong bids for goodly amounts. While it is to be regretted that the incident occurred, the substantial position of the company has been never more strongly shown than in the willingness to pay high 'prices by investors for the little floating stock.

11. November 20, 1906 Evening Star Washington, DC
Article from Evening Star, November 20, 1906

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DEPOSITORS RETURN. Those Who Withdrew Again Place Funds With L. and T. Company. "It is all history now, though we will never cease wondering how it happened," said President John Joy Edson of the Washington Loan and Trust Company today, in speaking of the "run" upon that institution which began Friday and ended yesterday at noon. Business resumed its normal course in the bank yesterday and continued today, the only feature being a considerable rush on the part of the depositors who withdrew their money from the institution Friday, Saturday and yesterday morning to redeposit it. President Edson stated further that the company had gained a fairly definite idea as to the starting of the rumor which inspired the run, and no efforts will be spared to learn the exact form of the original trouble-making story. If it is proved to have been at all malicious the company proposes to institute whatever proceedings may be necessary to have punishment placed where it is deserved.

12. December 20, 1906 The Washington Herald Washington, DC
Article from The Washington Herald, December 20, 1906

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Equity Court No. 2. JUSTICE GOULD. Wheelan vs. Wheelan; auditor's report confirmed and distribution ordered. Complainant's solicitors, Stuart McNamara and H. B. Moulton: defendant's solicitor, J. W. Jennings, Horn vs. Horn: rule to show cause, returnable Jannary 4. 1907. Complainant's solicitor, Albert Sillers: defendant's solicitor, W. P. Plamley. Kleps vs. Kleps: will established and trustee given power to sell; bond, $5,000. Complainant's solicitors, 8. V. Hayden and H. L. Frane. Scott vs. Jennings: receivers authorized and directed to sell personalty at public auction. Complainant's solicitors, John Ridout and George C. Gertman: defendant's solicitor, D. W. O'Donoghue. Reinburg VS. Reinburg ; amendment of former decree reducing alimony. Complainant's solicitor, W. Gwynn Gardiner; defendant's solicitors, Lester & Price. Mackey VS. Felt; salo confirmed and reference to auditor. Complainant's solicitor, Crandal Mackey; defendant's solicitor, Guy H. Johnson. Freeman vs. Freeman; sale confirmed and reference to auditor. Complainant's solicitor, John B. Larner Boswell vs. Boswell: divorce a vin. mat. granted. Complainant's solicitors, Campbell Carrington and S. D. Truitt; defendant's solicitors, Wolf & Rosenberg. Washington Loan and Trust Company VS. Dulany: appearance of absent defendant ordered. Complainant's solicitors, A. 8. Worthington, J. J. Darlington, John B. Larner, and W. G. Johnson. Title Guaranty and Surety Company vs. Shaw; demurrer sustained. with leave to amend. Complainant's solicitor, Philip Walker; defendant's solicitor, D. W. Baker. Snitzer VS. La Porte; rule as to receivers returnable January 4, 1907. Complainant's solicitor, Leon Tobriner. No assignment for to-day.