Article Text
125,000 Depositors in Closed D.C. Banks (Continued From Page 1) hands of receivers since last summer and are being liquidated. 8. More than 125,000 depositors are involved in closed or restricted banks representing about 20 per cent of the total deposits in the District. A spokesman for the 20 banks that are open and functioning normally said today that the officers and directors of these banks are pleased with the public's display of confidence. The confusion occasioned by the 10-day moratorium and the restrictions on numerous banks in Washington and other cities has been cleared up to such an extent that officers and clerks of the 20 open banks are able to live normal lives again. The 125,000 depositors of closed and restricted banks are becoming impatient and a bit irritated. Rumors that certain banks would reopen on a restricted basis have disappointed thousands of depositors, and have given place to rumors that few, if any, of the banks now in the hands of conservators would be able to pay substantial amounts to their depositors any time soon. Conservators say they are unable to make any statements to their depositors as to when and how much they may be able to pay. All but one of the present conservators are officials of the banks of which they have been placed in charge. However, they are now really officers of the United States Government, responsible to depositors rather than to stockholders. They differ from a receiver in these respects: 1. They have greater flexibility. 2. They have a longer period of liquidation. 3. The have wider borrowing A bank receiver is appointed only when the Government has definitely determined that the bank is insolvent, and its liquidation is necessary for the benefit of depositors. Aside from The Park Savings Bank, no irregularities have been found among the banks now in the hands of conservators. REORGANIZATION Heroic efforts to reorganize are being made by stockholders, officers and large depositors of a number of the banks in the hands of conservators. They are finding difficulty in interesting purchasers of new bank stock because of the prejudice that has grown up because of the 100 per cent liability attached to all common bank stock. Commercial interests of Washington are faced with the possibility of 13 additional banks going thru recervership with the consequent destruction of property values and credits brought about by such forced liquidation. More than 125,000 depositors are faced with the possibility of receiving little or no return on their deposits for many months and then not receiving the full amount of their deposits. An illustration of this is the case of The International Exchange Bank which went into the hands of receiver last August and paid its first dividend of 16 2-3 per cent this week, 265 National Banks Reopened, Woodin Says Secretary of Treasury Woodin announced today that 265 national banks, with deposits of $350,000,000, were reopened for 100 per cent operations in the 10-day period preceding March 25. The number was an addition to the banks reopened when the national bank holiday was lifted.
