First National Bank - Portsmouth, VA

Bank Information

Episode Type: Run → Suspension → Closure
Bank Type: national
Bank ID: 9300
Charter Number: 9300
Start Date: July 15, 1929
Location: Portsmouth, Virginia (36.835, -76.298)

Metadata

Model: gpt-5-mini
Short Digest: 5444fa71

Response Measures

Accommodated withdrawals, Capital injected, Partial suspension, Books examined

Other: Bank was sold/absorbed by American National Bank which assumed liabilities; later receiver referenced in 1934 for the old First National.

Receivership Details

Depositor recovery rate: 9.5%
Date receivership started: 1932-10-24
Date receivership terminated: 1938-10-31

Description

A run on the First National Bank of Portsmouth followed the closure and defalcation at its subsidiary/connected State Bank (cashier arrested for shortage). The run materially reduced the parent bank's cash and led directors to sell the assets and have American National Bank assume liabilities; the First National was effectively absorbed and ceased independent operations. I infer a suspension/partial cessation occurred as part of the transfer; later receivership references (1934) confirm ultimate closure. Dates taken from July 15-16, 1929 news reports.

Events (6)

1. December 29, 1908 Chartered

Source: historical_nic

2. July 15, 1929 Run

Cause: Local Banks
Cause Details: Closure of the State Bank of Portsmouth after cashier George Larkin was arrested for defaulting ~ $120,000; news of that failure triggered a run on the parent First National Bank.
Measures: Directors arranged sale of assets to American National Bank, which purchased assets and assumed deposit liabilities to protect depositors.
Newspaper Excerpt: The closure of the State bank resulted in run on the parent bank, which was withstood, although the bank's ready supply of cash was materially reduced
Source: newspapers

3. July 15, 1929 Suspension

Cause: Local Banks
Cause Details: Severe withdrawals following the State Bank's closure depleted cash; directors invoked protective measures (sixty-day notice for passbooks mentioned for city banks) and arranged for transfer of assets to American National Bank rather than continue normal operations independently.
Newspaper Excerpt: When the doors of your bank opened Wednesday morning there was long line depositors waiting. Within few minutes... directors had requested the American National the assets... to protect depositors. After thorough and careful examination... only trouble being shortage cash due to unusual withdrawals during the last [week].
Source: newspapers

4. July 16, 1929 Other

Newspaper Excerpt: American National Bank has purchased the assets and assumed the liability to the depositors of the First National bank of Portsmouth. The announcement was made shortly after midnight after series of conferences which had been under way for several days.
Source: newspapers

5. January 15, 1930 Voluntary Liquidation

Source: historical_nic

6. October 24, 1932 Receivership

Source: historical_nic

Newspaper Articles (7)

1. July 15, 1929 The Portsmouth Star Portsmouth, VA

Article from The Portsmouth Star, July 15, 1929

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Bank Absorbs American National Becomes City's Largest Banking Institution by Purchase Purchase of the assets of the First National Bank the American National Bank and assumption by the latter the liability the depositors the former, effective today, makes the American National Bank largest financial instituresources of over six millions dollars. Announcement the purchase the First National by American National made this morning, following series conferences directors of the American National officers directors the First National, which have been der several Today all business of the First National Bank was being transacted expeditiously the Na. sional deposits being cepted, all drafts paid, and counts maintained the same effacy customers the latter institution during its eventful existence Physical Assets The physical assets the First National following request the directors the First National steps taken to protect depositors institution. The action after thorough and careful the and affairs the First National officers the National conjunction examiner. The solvency the First National Bank question, its only trouble being shortage cash, due unusual during week. The Bank antaking over the affairs of the First National, that felt its protect the deposithe First National, and assuming responsibility solely this spirit. Enlarge Quarters Absorbtion the First National will that the American Bank and steps this end will be taken the National today. Just what has decided but presumed doors the American National Bank building be utilized conducting the business of the bank in its enlarged scope. The officers of the American National Bank, has been the fastest growing bank Portsmouth its H. Parker, president: George Parrish, Edward Allen, assistant cashier; Riddick, asFrench, assistsistant cashier; cashier. The directors: H. Parker, Parrish, B. Hawks, R. BarTrotclay, Sol Fass, Hanvey, Hall, Sykes, Dorin, Cross, George Ivins, Dr. Vernon Parker, W. Hargroves, Taylor Hart and HayCarney, cock.

2. July 16, 1929 The News and Advance Lynchburg, VA

Article from The News and Advance, July 16, 1929

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Grand Refuses Closed Portsmouth Jury To Recess; To Take Bank Taken Over tant Cases Now By American Nat'l however. Chief Justice Overrules Order Of Circuit Judge, Ordering Inquiry Birmingham, July 15 county emerged victorious today the first conflict record between inquisibody presiding circuit with the cause state banks this district withthe the investiJudge Rusgrand elected Chief Justice Anderson the Alabama supreme court, resulting order McElroy "reconvene this jury for the consideration grave and matter involving perhaps violations criminal laws. The was issued by Judge McElroy Charles attorney for ings Bank had pleaded the grounds that sufficient had not elapsed for compilation reports closed banks demanded by the grand poena. Over the Attorney General McCall and County Solicitor George Bailes, Judge Elroy Rice Wilkinson established pediency' and ordered recess August Eighth Bank Closes Merchants Bank of Melbourne did not open Bank the comptroleir which was posted the window. count open for business Monday morning. This was the eighth which closed last in Florida. Four others failed on May To Assume Responsibility For Remaining Assets Portsmouth, July 15 American National Bank, effective this morning has purchased the assets and assumed liabilities the the First National Bank PortsFrank Lawrence, the former was shortly midnight which had been under several The Bank the the State Bank which recently was closed state examiners and the cashier which. George was arrested charge defaulting its funds. The closure the State Bank resultparent bank which was although the bank's ready supply cash was materially reduced. The physical assets of the First National the can National early this der that business of both banks could conducted without any delay made that the directors of the First National had quested over he the First protection depositors. thorough and careful examination affairs by officers of the American National. National Bank Armheim. solvency of the First National was demonstrated beyond question only trouble being shortage cash unusual withdrawals during the last American National Bank taking the affairs the First felt was duty protect he and solely purely and this spirit.

3. July 16, 1929 The Richmond News Leader Richmond, VA

Article from The Richmond News Leader, July 16, 1929

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Portsmouth Bank Change Announced PORTSMOUTH. Va., July 16.-(A) The American National bank has pur. chased the assets and assumed the hability to the depositors of the First National bank of Portsmouth. it was announced by Frank D. Lawrence, president of the former institution The announcement was made shortly after midnight after " series of conferences which had been under way for seevral The First National bank was the parent institution of the State Bank of of Portsmouth, which recently was closed by state bank examiners and the cashier of which, George Larkin, was arrested on charge defaulting with approximat $120,000 of its funds The closure of the State bank resulted in "run" on the parent bank. which was withstood. although the bank's ready supply of cash was materially reduced

4. July 16, 1929 Richmond Times-Dispatch Richmond, VA

Article from Richmond Times-Dispatch, July 16, 1929

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National Bank Of Portsmouth Hands Changes American National Bank Purchases The Assets Of Solvent Institution American National Bank. effective this has purchased the the First National Frank Lawrence president The announcewas made shortly midnight after series which had been under way for several days. National Bank was State Bank Portsmouth, recently was examiners and the cashier George ing approximately funds closure the State bank resulted on the parent which was though bank's ready supply was materially reduced The physical the First National American early this morning that business be conducted without any delay. Announcement was made that the directors of the First National had quested the American National the assets the First National, the protection its depositors. After thorough careful examcondition affairs the First by officers American National Examiner National was demonstrated only trouble shortage due unusual withdrawals during last American National Bank taking the First announced felt was protect the the purely this

5. July 21, 1929 The Portsmouth Star Portsmouth, VA

Article from The Portsmouth Star, July 21, 1929

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Tell Reason For Sale Bank Assets Directors of First National Relate Sale To Stockholders. Statement has been sent the directors the First tional Bank stockholders that outlining which prompted the the First National Bank to the American National Bank of Portsmouth which has all liabilities the First National Bank except as to stockholders capital stock of the First National Bank was $300,000 value. Many holders of this stock however, paid as high $210 per share with its this reason the large surplus assets the time such purchase. Just much the stockholders of the National will receive this stockholdings somewhat blematic. Some have estimated the stock may pay out value, but optomistic viewpoint. Every means will forward by the of the American National Bank save cent possible for the stockholders the First National. But for action of the erican Bank taking affairs of the First over tional the the of the First Bank holders might have been called upon under banking much again the par value their First National Bank stockholdings. Statement Directors The following the statement of First National directors the stockholders of that Bank institution: To the Stockholders of the First National Bank of Portsmouth, Virginia. Your Board of Directors has sold the American National Bank, Va., all of the assets and the American your Bank has all of liabilities the desire of the Board Directors to make full and plete statement of what, their made the above action opinion, necessary. wish to that First, say your institution thoroughly solvent, and its the first solvency thoughts bringing about its liquidation. On Tuesday, July positors of the State Portsmouth made that stitution, which cared for until closing time, but its depleted extent unwise to open for business Wednesday help be sceured. held Tuesday night, at which all the banks of of the city were present. This lasted four o'clock the ing morning. of tressed bank was thoroughly cussed, the consensus opinion that not be had without thorough investigation of the assets State Bank, which impossible before the opening hour Chief Examiner Banks Virginia was communicated and posted on door the State Bank and its branch that closed. The representatives of the bank the the seriousness the and the probabilities of your and sibly on other banks, entered into that beginning at nine each would avail itself the sixty day notice clause the pass books savings positors, and signed an agreement effect. When the doors of your bank opened Wednesday morning there was long line depositors waiting. Within few minutes (Continued Page

6. July 23, 1929 The Hopewell News Hopewell, VA

Article from The Hopewell News, July 23, 1929

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HOW TO SAFEGUARD BANKING Better examination of State banks is one of the great immediate needs of the State of Virginia. Only through lack of adequate examination by the State Department of banking and insurance can we understand how a defalcation of $120,000 may occur in a city like Portsmouth, Va., where just such a situation has developed. Just how a cashier of this State bank could conceal and "get by with such a defalcation in the face of periodic examination we cannot conceive, sure that such a large shortage could not have developed in a short period time. Unquestionably this large aggregate of funds had been accumulated through long period of time and a series of peculations for stock gambling or some other such unlaw purpose. Yet a man who was trusted and doubtless well remunerated for his work and responsibility appear to be who has SO grossly abused a high trust. When such tartling disclosures a run on the Lank by lenesitors begin this COOD exhausts the availai le supply cash, with the that the bank its depositors and must close its doors and suspend operations. Happily in this instance the parent bank of this State institution, although able to withstand a run upon it also, found its business SO crippled that it has sold its assets to the American National bank, which also assumes the First National liabilities. The transaction is practically the absorption of the First National by the American National, thus safeguarding the depositors and stockholders of the First National, which passes out It was clearly to the interest of the American National a strong solvent institution, to take over the capital, business ano liabilities of the First National in order to restore and sustain confidence in banks generally and thereby reassure its own depositors and stockholders. The relation of banks is SO involved with the affairs and interests of other banks that the defalcation and failure of one inevitably creates a distrust and suspicion on the part of some of the solvency and safety of banks generally hence we wonder why the safe strong banks will permit a small and weaker one to go to the wall either through shrinkage in the value of as sets the dishonesty of trusted officials when by bolstering the weak, even insolvent bank it may restore public confidence in all the banks of a community. It is the business of banks to lend money. and it is probably true that even the soundest and most solvent banks have their assets and capital loaned to such an extent that a sustained and persistent "run on the bank" by depositors cannot be withstood un less the bank whose funds are being rapidly withdrawn can borrow sufficient money to meet all demands. That would stop a run and allay any vague, unfounded public distrust even of the weaker banks in the community. The American National's purchase of the assets of the First is clearly to the interest of the American, as well a: of the bank absorbed. The real basis of all business is the maintenance of public confidence in all the banks of the community and the country. In the light of such experiences as that in Ports mouth even an idle rumor may embarrass sound institutions. Hence the wisdom of the suggestion that banks have their de posits insured, thus eliminating the possibility of loss. This would cost the bank: large sums of money, but the costs of insurance of deposits would naturally be passed on to the depositors themselves by the banking institutions ,but this would safeguard depositors and protect stockholders and all banks, which is desideratum worthy to be thoughtfully considered. The insurance companies in such a situation would themselves maintain a vigilant supervision of bank operations which would effectually safeguard all banks. Such a problem would have to be worked out carefully by th bankers and the insurance companies assuming the risk. The immediately available remedy lies in making State and private bank inspection SO thorough that it would not be possible for a dishonest bank or official to pile up such large and disastrous defalcations as to wreck the bank in which they are trusted officials. The good, safe and strong banks suffer with the weaker institutions in times of stress and the sway of suspicion; hence their interest in abating dishonest and unsound banking. Not infrequently tragedy follows in the wake of dishonesty, for the exposed defaulter kills himself rather than face shame and punishment. Hopewell has sound, strong and safe banks and it is worth a great deal to them and to the community to scrutinize all banking operations and invite thorough and frequent inspections by competent examiners. It might be wise also for such banks to create no subsidiaries in the small towns and the country wherein such rigid examination and supervision are lacking. The Japanese are about to pose in the role of peace-maker while the Chinese aspire to be the pace-maker. "Let's run over to Charles City" will soon mean something to Hopewell people. They do not call the head of the prohibition enforcement commission Wicked-Sham any more, unless it is a typographical error. The State and local primaries are but two weeks from this Tuesday. Then the candidates may take a vacation. "Autoists warned of drinking water" according to a headline in a Richmond paper. Also of driving while drunk. The soviets must fight far from base, and the great handicap they have is to maintain their communications and line of retreat.

7. October 12, 1934 The Portsmouth Star Portsmouth, VA

Article from The Portsmouth Star, October 12, 1934

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Former Owners of Bank Stock Claimed Liable Under Sale To Minors J. A. Gamble, Washington receiver of the old First National Bank of Portsmouth has brought two actions In the Federal Court at Norfolk against former owners of First National stock claiming statutory liability under double sessment because stock they sold passed into registration at the bank in the name of minors. It has been held that who, after becoming of age, did not in writing acknowledge the registration in their name of the old First National Bank stock cannot now be held liable on double assess. ment. With this situation the closed bank receiver who cannot collect from minors is going back on the conditioned every inch of seller of the stock claiming liability, Settee and Club even though the seller might not have had that and Shade were placing the acquired stock in the name of minors. The cases against Portsmouth Open Saturday people will tried before Judge Luther B. Way in U. S. Court this Night Until 9 coming winter. The cases present a very inter esting point and would indicate that sellers of bank stock havCirculating ing double liability should be careful not to assign their stock blank for future registration Coal Heaters names of persons unknown to them.