Franklin Institution For Savings

Bank Information

Episode Type: Suspension → Closure
Bank Type: savings bank
Start Date: January 27, 1879
Location: Providence, Rhode Island (41.824, -71.413)

Metadata

Model: gpt-5-mini
Short Digest: 7a0ec3a2

Response Measures

None

Description

Articles from early 1879 report the Franklin Institution for Savings in Providence as having been ruined by the Sprague collapse, with a receiver (Winthrop D. De Wolf) acting for the bank, selling Sprague property to satisfy judgments, and seeking recovery in equity. There is no description of a depositor run; rather the bank is in receivership and selling assets — consistent with suspension and permanent closure/receivership. OCR typos in source articles (e.g., Chaffee/Chafee, DeWolf/De Wolf) were corrected when extracting names.

Events (3)

1. January 27, 1879 Suspension

Cause: Bank Specific Adverse Info
Cause Details: Bank was ruined by the Sprague collapse — large holdings of A. & W. Sprague paper (heavy losses on Sprague notes) led to insolvency and suspension.
Newspaper Excerpt: The receiver of the Franklin Institution for Savings, of this city, will file a bill in equity against the firm.
Source: newspapers

2. March 24, 1879 Receivership

Newspaper Excerpt: Mr. De Wolf, who is the receiver of the Franklin Institution for Savings, which was ruined by the Sprague collapse, refuses to join the other creditors in the new movement to form a corporation ... I represent nearly six thousand depositors, and I feel it my duty to make their interest paramount ... (March 24, 1879).
Source: newspapers

3. September 20, 1879 Other

Newspaper Excerpt: The Franklin Institution for Savings, through Winthrop D. Wolf, receiver, to-day sold the Sprague property to satisfy an execution. Nominal prices were given and the bank bought all the property.
Source: newspapers

Newspaper Articles (6)

1. February 1, 1879 New-York Tribune New York, NY

Article from New-York Tribune, February 1, 1879

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Article Text

THE SPRAGUE CREDITORS. AN EFFORT TO REMOVE THE RECEIVER - THE CHARGES AND THEIR DENIAL. [FROM AN OCCASIONAL CORRESPONDENT OF THE TRIBUNE.] PROVIDENCE, R. I., Jan. 27.-The numerous creditors of the house of Messrs. A. & W. Sprague. of this State. will have a hearing February 24 in the Supreme Court in this city, upon the bill in equity filed in July last by creditors representing $4,200,000-overonehalf of the total indebtedness of the firm,and who consist mostly of banks and other corporations, very few private creditors being included in the list. The creditors ask for the removal of the receiver and assignee, Mr. Zachariah Chatee, of this city, and they desire a Letter accounting of the property held in trust by that gentleman under the provisions of the now famous "trust deed." They claim that Mr. Chafee is acting in the interest of the defunct firm in his official capacity, paying large salaries to William Sprague and to his brother, Amasa Sprague, and they also claim that he has discharged skilled workmen and placed interior ones in their places and has in every possible way joopardized the creditors' interest, and that be will not allow them to examine his books. Other charges of a more or less serious nature are made, all of which, as might be supposed, are denied in the receiver's reply, which claims that he 18 acung for the best interests of all concerned. He has kept up the vast property and has paid the insurance and taxes, amounting to $200,000 it year. The creditors seem to favor the selling of the property, no: withstanding the depressed condition of the markets, and dividing the proceeds pro rata among them, for they begin to think that they will not get 25 cents on the dollar, is larger sum that the firm's paper is occasionally sold for in this city; it has sold as low as 16 cents. Many are of the opinion that the paper is bought in the interest of the firm of A. & W. Sprague. With the insumerable lawsuits brought against the estate since 1869, upon which no decisions have been given as yet, it would seem as if it were impossible to adjust the claims very speedily. The new concern is not runtung in debt. It is called the 'Quidueck Company," tue name of a solvent corporation managed by Messrs. A. & W. Sprague before their failure. The stopping of the mills, print-works. etc., would entail no little suffering The concern affords employment to nearly 1,200 persons. All the mills are running, and the numerous operatives are earning fair wages. The receiver of the Franklin Institution for Savings, of this city, will file a bill in equity against the firm. asking to have the trust deed set aside in season for the March Term O the Supreme Court. and he expects to secure a hearing upon the same early in the Authum. By a decision recently rendered by the New-York Court of Appeals in the case of several banks of this CITY against Mr. Judhard, the receiver of the New-York house of Hoyt, Sprague & Co., to recover upon a bond given by the firm to the banks to secure payment for a loan made in 1873, the sum of $50,000 and upwards will be obtained. Of this 8010 the Franklin Bank will receive $20,000. but this, it appears. will not be enough to enable the receiver to declare anothere div dend, as it takes $27,000 to make a dividend of even 1 per cent. and he will not be able to pay the depositors any further dividends unless the bill in equity 18 decided in his favor. So far the depositors in this bank have received dividends amounting to 72 per cent. The depositors in the Cranston Bank have been paid 69 per cent. Both these savings institutions were wrecked by the failure of Messre. A. & W. Sprague. It will be it long time before the affairs of this once noted house will be settled. even if there are no delays in the courts. Matters are in a very chaotic state-at least, this is the opinion of the principal creditors. The laws era will reap a rich harvest. The senior counsel for the creditors, who have a hearing next month, is the Hon. Benjamin H Bristow, k-Secret ry of the Treasury. The leading lawyers in this and other States are engaged by one side or the other ID the numerous suits pending in the counts 10 Rhode Island, New-York and Boston

2. February 21, 1879 The Sun New York, NY

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SETTLING THE SPRAGUE ESTATE. The Largest Creditors Moving to Secure the Removal of the Trustee. Early this week Messrs. Metcalf & Pomroy of Providence addressed a letter to Mr. Zachariah Chaffee, trustee of the A. and W. Sprague estates, asking him if he would agree to the terms of any paper which all the creditors of the Spragues might sign. Mr. Chaffee promptly replied in the affirmative, whereupon the same gentlemen addressed to him another letter inquiring if he would equally agree to any petition signed by three-fourths of the creditors, and Mr. Chaffee again responded that he would acquiesce in the terms of any petition so signed. One of the gentlemen who addressed these letters to Mr. Chaffee, Mr. Metcalf. is a member of a committee appointed by certain of the Sprague creditors a year ago, and which at the time brought suit against Mr. Chaffee in Rhode Island to put him out of the trusteeship. The Committee consists of Messrs. Aldrich. Metc lf. Weeden. and Farnum. and in the suit brought by them they swore that they represented $4,000,000 of the Sprague paper. Mr. Farnum is the receiver of the Franklin Institution for Savings, in Providence, which holds $700.000 of these notes. Messrs. Metcalf and Aldrich are directors in the Second National Bank of Providence, which is another institution holding the Spragues' paper to a large amount. The First National, the Globe. and the Cranston Savings Bank, the latter in the hands of a receiver. make. with the others mentioned, five banks in Providence which together hold $3,500,000 of the Spragues' extension paper or old trustee notes. These, at least, will sign the paper asking for the removal of Mr. Chaffee. the idea being. probably, to pool the whole property and then to fight all suits outside. Such as join in the movement will sign an agreement to unite in a corporation for the purpose of obtaining possession and control by purchase of the said property and its conversion and application to the liquidation of our debts. and to take stock in such corporation in proportion to our respective claims." the agreement to be binding when three-fourths of the creditors in amount shall havesigned thesame. The total liabilities of the Spragues are $8,000,000. Of this. $5,000,000 is held by fifteen banks, and the rest is spread all over the country. from Maine to South Carolina.

3. March 25, 1879 The New York Herald New York, NY

Article from The New York Herald, March 25, 1879

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A: & W. SPRAGUE. ACTION OF THE FRANKLIN SAVINGS BANK IN LEVYING ON THE PROPERTY-HIS CLAIM THAT THE BANK DEBT IS A PREFERRED ONE. [BY TELEGRAPH TO THE HERALD. PROVIDENCE, R. I., March 24, 1879. Rumors flew thick and fast to-day relative to the action of Winthrop De Wolf in levying on the prop. erty of A. & W. Sprague wherever found in the State. The HERALD correspondent found Mr. De Wolf and from him secured the actual facts of the transaction. Mr. De Wolf, who is the receiver of the Franklin Institution for Savings, which was ruined by the Sprague collapse, refuses to join the other creditors in the new movement to form a corporation for the purpose of taking the property out of the hands of Mr. Chafee, the receiver. Said Mr. De Wolf:--M reasons for not joining the combination are that I had attempted to make my claim a preferred one. All who joined the corporation scheme stand upon an equal footing. Consequently I should be compelled to abandon my position altogether if I joined them. Some three years ago I commenced suit in the Supreme Court upon the original notes and drafts given by the A. & W. Sprague Manufacturing Company, and discounted by the bank which I represent, in which suit I obtained judgmout recently for upwards of $800,000. The levy and execution following that judgment were enforced upon the property by my order. am about filing a bill in equity to set aside the Sprague trust deed and assignment as a cloud upon the title which prevents my realizing under my judgment, or, in other words, will prevent the property from selling at anything like I fair value until it is removed. a represent nearly six thousand depositors, and I feel it my duty to make their interest paramount to those of all other creditors if possible, they constituting a class more needy than any others to whom the Spragues are indebted. My action in this matter, so far as I know, will not embarrass or delay the formation of the corporation proposed." OTHER PREFERENCE CLAIMS. "The National Bank of Commerce of New York," continued Mr. DeWolf, "which has never assented to the trustee arrangement, obtained judgment in December in the United States Supreme Court for about $60,000, which it will enforce in due time. That and the claim of the Hoyt heirs, in New York, are the only ones besides mine sought to be established as preferred claims." TEDIOUS LITIGATION. "In 1873 the bank which I represent, with four others, made a loan of $600,000 to Josiah Chapin, of Providence, secured by a large tract of land in this city and also by the guarantee of the members of the firm of Hoyt, Sprague & Co., of New York, then solvent. Default was made on the mortgage in 1874. In 1876 the bank foreclosed on the mortgage and sold the property. Less than one-half the claim being offered at the sale the banks bought in the property and filed claims for the deficit against the receiver of Hoyt, Sprague & Co. and also against the estate of Edwin Hoyt, deceased. Both ot these claims were rejected. In one against the receiver, Icarried through

4. September 20, 1879 The Cincinnati Daily Star Cincinnati, OH

Article from The Cincinnati Daily Star, September 20, 1879

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HOUSE OF SPRAGUE. Property Sold at Providence--Hearing of Mrs. Sprague's Petition. National Associated Press to the Star. PROVIDENCE, R. I., Sept. 20.-The Frank)in Institution for Savings, through Winthrop D. Wolf, receiver, to-day sold the Sprague property to satisfy an execution. Nominal prices were given and the bank bought all the property. The New York Bank of Commerce has a prior claim and Z. Chaffee's trust deed is back of all. These sales will not hold good unless the trust deed is broken. The hearing of the petition of Mrs. Katherine Chase Sprague for a trustee for her personal property at Canonchet was had to-day. Governor Sprague did not oppose the granting of the petition, but there was a contest as to the proper person to be appointed. Mrs. Sprague's counsel named Mr. Robert Thompson, one of her lawyers, and the Governor's counsel nominated Arthur Watson, a relative of Mr. Sprague's. Considerable discussion was had as to the merits and demerits of both. A continuance was had until Friday next at 2 p. m.

5. September 21, 1879 Eureka Daily Sentinel Eureka, NV

Article from Eureka Daily Sentinel, September 21, 1879

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EASTERN NEWS. BY TELEGRAPH. The World on Tilden's Candidacy. RAILROAD PROGRESS IN THE WEST. BRITISH IGNORANCE OF AMERICAN AFFAIRS Colorado Republicans Declare for Great. NEW YORK, September 20. The World, the leading anti-Tilden organ, says editorially: What it concerns us to-day to point out is that in publishing this most distressing statement, neglected by the Associated Press, Tilden has made it impossible for the Democrats of the United States ever again seriously to en- tertain the notion of entering the contest for the Presidency under his leadership with any hope of success. He has delib- erately elected to commit himself to a law suit concerning his own character with Cyrus W. Field, over the duration of which, and over the issues involved and to be in- volved in which. neither he nor the Demo- cratic party can expect any control what- ever. The Democratic party cannot suc- cessfully go into the Presidential battle of 2880 as the defendant in a law suit between Tilden and C. W. Field. Mrs. Sprague's Application. PROVIDENCE, R. I., Sept. 20. In the Supreme Cour: this morning the hearing began upon the application of Mrs. Catherine Chase Sprague, for the appoint- ment of a trustee of her property. Coun- sel for petitioner stated that ex-Governor Sprague and his wife were not living to- gether, and there was no reasonable pro- bability that they will live together in the future. This declaration he based upon the sayings and acts of both persons. He nominated Robert Thompson for trustee. Counsel for ex Governor Sprague agreed with the other side as to the law in the case that Mrs. Sprague had a right to a trustee, but he objected to the nomination of Thompson, and moved its reference. This motion the Court overruled, when the counsel for Mrs. Sprague nominated Ar- thur Watson for trustee, and asked for a postponement until Friday next to enable him to file reasons for his motion. The case went over to Friday. Various parcels of the A. & W. Sprague estate, recently sold under execution to the New York Na- sional Bank of Commerce for nominal sums, were struck off again to day to sat- isfy the judgement claim of the Franklin Institution for Savings. The receiver of the bank was the only bidder. British Ignorance of American Af- fairs. NEW YORK, September 20. Lord Beaconsfield's address at the agri- cultural banquet in Aylesbury on Thursday is sharply criticised here on account of the ignoraure di-played in his statements con- cerning American affairs. He represented that the greatest apprehension is felt in the United States on account of Canadian competition in grain raising, and that nearly all the chief landholders in the ex- treme Western States had sold out and gone to Manitoba, and begun the work of caltivating there. The papers here show that the immigration is the other way, from Manitoba to Dakote, and from Can-

6. September 25, 1879 The Stark County Democrat Canton, OH

Article from The Stark County Democrat, September 25, 1879

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SPRAGUE-CHASE. Legal Proceedings in the Case. Providence, Sept. 20.-In the Supreme Court this morning, hearing was begun upon application of Mrs. Catharine Chase-Sprague for the ap. pointment of a trustee for her property. Counsel for petitioner stated that ex-Governor Sprague and wife were not living together, and there is no reasonable probability that they will live together in the future. This declaration he based upon sayings and acts of both persons. He nominated Rob't Thompson for trustee. Counsel for ex.Governor Sprague agreed with the other side as to the law in t e case, that Mrs. Sprague had & right to a trustee, but he objected to the nomination of Thompson and moved its reference to a Master. This motion the Court overruled. when Counsel for Mrs. Sprague nominated Arthur Watson for trustee. and asked a postpotiement until Friday next to enable him to file reasous for his motion. The case went over till Friday. Various portions of the A. and W. Sprague egtate, recently sold under execution to the New York National Bank of Commerce for nominal sums. were struck off again to-day to satisfy a judgment claim of the Franklin Institution for Savings. The Receiver of the bank was the only bidder.