First National Bank (Marysville, KS)

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Working on Re-organization From Marysville Advocate-Democrat

Although the directors of the First National bank have been working steadily on re-organization plans no public statement has as yet been issued that we might be able to pass on to our readers.

Despite rumors to the contrary the appointment of a receiver for the closed bank does in no way delay or impair the re-organization plans. No time limit has been placed by the comptroller and every effort is being made and will be made to clear away the difficulties and to take the necessary steps to open the bank. Receiver Harvey will lend his efforts along this line and it is to be hoped that an announcement may soon be made to the public fully outlining true conditions.

In an interview with Mr. Harvey yesterday he advised a representative of the Advocate-Democrat that the work was progressing as fast as possible under the circumstances. It must be realized that a vast amount of work must be done by the receiver and his assistants before the doors may be thrown open and business transacted with the public. The receiver's books have arrived and it will be necessary to open them up and transfer all the items of the bank to these books before notice can be given to the public by the receiver that they may reconcile their accounts, prove their claims, etc.

Authorization has been given to appoint necessary assistants and yesterday Mr. Harvey announced the appointment of W. J. Gregg of Frankfort as legal advisor and Ross K. Kinsley as stenographer. Other assistants will be appointed as necessity requires.

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DEPOSITORS MEET

Two Plans Put Forward to Reorganize First National Bank. —Receiver Harvey Answers Questions at Big Gathering.

The meeting of depositors of the First National bank which had been called to gather in the Chamber of Commerce last Monday night brought together 250 to 300 people and as the facilities for holding the meeting at the place named were wholly inadequate the crowd moved over to Turner hall where, after C. A. Hammett had read the call for the meeting, an organization was perfected by the choice of E. C. Bennett as chairman and R. E. Long secretary.

Mr. C. A. Hammett presented a plan for the opening of a co-operative bank which in part proposes: "That enough of the deposits of the bank be converted into stock to establish a mutual co-operative bank, and to offer stock to the public to provide the money needed for working capital.

"The new organization to take over all of the assets of the present bank, together with as much cash as the directors can raise.

"To convert such assets into cash as soon as possible and permit checking accounts on the balance of deposits in proportion to the cash received.

"Any surplus obtained out of the assets, after satisfying the claims of the depositors, shall be returned to the stockholders of the old bank in proportion to the amount each has put up.

"The depositors to elect from among their number a board of directors who are to have the management of the new bank and conduct it as a mutual co-operative bank under existing laws."

A. J. Harvey, receiver for the bank, was then called upon and detailed the steps which have so far been taken to affect a reorganization. He also presented the following plan as one which would be acceptable to the National Bank Comptroller and which was published in its entirety several weeks ago in this paper.

In short this plan is as follows:

"The directors have placed in the hands of A. J. Harvey, the receiver, cash and securities amounting to $97,000.

"It is now proposed to raise a fund of $160,000 to purchase from the receiver the following assets of said bank:

"The bank building and permanent fixtures now carried on the books at the value of $85,000.00 "Hohn building 25,000.00 "Other real estate, including dwelling at Hanover and 140-acre irrigated farm in Colorado at value of 9,000.00 "Slow and doubtful paper approximating 129,000.00

"Said sum of $160,000 to be raised by subscriptions from the depositors and others interested in the re-organization and re-opening of the bank—said fund to be placed in the hands of trustees to be selected by the subscribers to this fund, which fund shall be used for the purchase from the receiver of the assets above mentioned. The assets so purchased shall be held in the name of said trustees for the benefit of those participating in said trust. It shall be the duty of said trustees to sell the real estate so purchased as soon as possible at the best price possible, and until such sale is made, to rent the same and collect the rents therefrom, and to collect, compromise and settle all charged off paper with a view of realizing as much as is possible from the same. They shall place all money realized from the sale and collections at interest.

"That said trusteeship shall run for a period of time to be decided upon by those participating in the trust fund, or until the fund so accumulated amounts to $160,000, and said fund shall be prorated among those participating in said trust.

"That said trustees shall give suitable bonds for the faithful performance of their duties as such trustees.

"The holders of certificates in said trust fund assume no liability of any kind by reason of said subscriptions."

This plan is based on the same methods used in other places in reorganizing defunct banks and since the Monday night meeting dozens of depositors have expressed themselves as being desirous of adopting and putting through this plan.

Following this Mr. Harvey answered all questions asked and discussed the bank situation from every angle. He was frank in his answers and made it plain that it was his desire as well as that of the National Banking department that the bank should be put on its feet with the minimum of loss to depositors.

C. A. Hammett then went into details with regard to his plan and it was decided that a committee of five be appointed by the chairman and secretary to hold conferences with Messrs. Harvey and Hammett and also receive and give consideration to such other plans as may be presented and report same at a meeting to be held next Monday night.

Announcement was made Tuesday by Messrs. Bennett and Long that they had met with Messrs. Harvey and Hammett and after a thorough canvass of the names of the large depositors, the following committee was appointed:

William Kraemer, who represents two large deposits in his own name; J. G. Schmidler, who represents three deposits, and is in addition an experienced banker; John Kuoni, who represents two large deposits, and in addition has had considerable experience in running mutual organizations; J. R. Montgomery, who represents the Bone-McLucas Lumber Co. and other interests; Mrs. H. L. Wilson, with large deposits, will be represented by Attorney W. W. Redmond.

The above committee was chosen because of their large interests, their ability to handle the proposition, and because all seemed to be available. Their meeting will be held in the bank building tomorrow, Friday, evening at 8 o'clock.

This committee will report its findings at the depositors' meeting which will be held at the Turner hall next Monday evening at 8 o'clock. Every depositor of the defunct bank is urged to be present.

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BANK SITUATION

Large Number of Depositors Approve Plan of Re-organization.—Bank Open Saturday Nights for Depositors' Benefit.

Since our last issue quite a number of the depositors in the First National bank have approved of the plan arranged for re-organization and already the owners of $85,000 of the deposits have consented to letting 40 per cent of these deposits be put in the trust funds. Slips are being mailed out to all depositors and a letter accompanying explaining the necessity for the plan put forward and it is most encouraging that in nearly all cases those who receive these slips have been coming to the bank and signing up.

The bank is open from 9 to 5 each day during the week, except on Saturday when it is kept open for the benefit of depositors who are unable to come in during the regular hours. Any depositor who has any doubts with regard to the plan suggested is urgently requested to call at the bank and Receiver Harvey will explain all points in full.

It is urged upon all depositors that they give consideration to this matter as soon as possible. The response so far has been satisfactory, but if the bank is to be put on its feet and be of service to this city and territory surrounding it is advisable that each and every contributor come in and decide as to what attitude is to be taken with regard to the trust fund. All of us are interested in the liquidation of the bank and in the protection of depositors and it is obvious that any unnecessary delay will merely work to the detriment of those who have most at stake.

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BANK PROGRESS

Receiver Harvey Working Hard on Reorganization Plans.—Makes Urgent Request That Depositors Get Information.

Receiver Harvey is still at work on the plan to bring about the reorganization of the First National bank. Considerable progress has been made in the work of securing the consent of depositors to permit not less than 40 per cent of their deposits to remain in the trust fund, payment to be made out of the income on the property of the bank, but there still remain quite a number who have not come in and secured first hand information as to what that plan means.

Obviously, to throw the real estate property of the bank on the market at this time would mean considerable loss to depositors. It is to avoid such loss that the plan of reorganization has been evolved and when it is explained each and every depositor can see that it is the only plan yet produced which gives promise of enabling the bank to be liquidated at a minimum of loss.

When you are in town step in and talk over matters with Receiver Harvey at the bank. Get a thorough explanation as to what it will mean to you to join with the others in aiding in the work of reorganization. We feel that if you will do this that you will join with the great majority who have already given approval to the agreement and every day lost means delay in giving to the depositors use of a good portion of their money.

Do not delay, but call at the bank this week and talk the matter over.

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REJECT BANK BID

Deputy Comptroller Rejects Bid of L. N. Cole for First National Bank Building—Receiver to Continue Negotiations.

Tuesday Receiver A. J. Harvey of the First National bank was in receipt of a telegram from the assistant comptroller of the currency stating that the bid received for the building and equipment of the bank last week, the amount being $38,100, was considered inadequate.

Deputy Comptroller McIntosh wired: "The amount offered for building, furniture and equipment is not deemed adequate. You are authorized to reject bid and continue negotiations for an offer that can be accepted by this office."

In giving permission to offer this property at public sale on October 20, the comptroller specified that any offer made should have to be satisfactory to the comptroller before such sale would be approved and the action now taken is along that line. It leaves the situation up in the air as far as the sale of the building at this time is concerned, as it was made evident at the public sale held on December 8 that but little interest in securing the property was held by outsiders and the local parties consider that the price offered was all that could be expected.

Won't Retard Dividend.

Very fortunately any delay arising will not interfere with the declaration of a dividend to the depositors of the bank. Receiver Harvey informs us that since such a dividend has been approved he has been busily engaged in preparing the schedules. This entails considerable work, as every interest must be protected, but good progress has been made and it is now safe to say that the first dividend payment will be made some time during the month of January.

This will be mighty good news to those whose funds have been tied up in the defunct bank and it should have a valuable psychological effect in stimulating every line of business in the community.

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NEW CASES FILED.

The following new cases have been filed in the office of Clerk of the District Court A. B. Campbell since our last issue:

G. F. Bueker vs. H. M. and Edward Thompson; appeal from justice of the peace.

J. M. Veach vs. Oliver M. Adams, et al., recovery of money.

The Grisco Nurseries vs. E. G. Manrose; appeal from justice of the peace.

A. J. Harvey, receiver First National Bank, vs. E. R. Fulton, et al.; petition and application for order.

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PAYING DIVIDEND

Work of Paying to of Defunct First Depositors National Bank Well Under Making Good.

The payment of 25 per cent dividend to the creditors of the First National Bank was approved by the Comptroller of the Currency and the checks to pay the same were ceived the Comptroller's office Tuesday, that the work of paying the sums due to the creditors well under In all there are 195 checks ready for delivery and these represent total of Those entitled to receive payment this dividend can do by calling at the bank, bringing their receiver's certificates with them and the check be handed Since the time of the closing the bank the receiver has collected for the trust and when the present dividend he will have expended total payment on liabilities. In doing this there has been no foreclosures of mortgages and only case of money received from bankruptcy case.

Many Big Claims Paid.

Looking over the claims that have been paid find that was paid re-discounts order to deem the collateral security and stop the payment of interest and the penses agent collect the First National Bank of St. Joseph, Mo., $20,000 was paid to deem collateral security. The state deposit, amounting to paid, the state holding Liberty Bonds the value of $20,000 as security The state sold these bonds and took the amount due. The Postal Savings deposit, which amounted $164.48, was paid, the Post Office Department having Liberty Bond of the value of to same. The deposit of Marshall county amounted to and has been paid. secure this county held bond signed by the directors the bank. An agreement was made tween the receiver and the directors. approved by the Comptroller of the Currency and by order of the District Court, whereby the receiver assumed the liability of the directors under the personal bond for whatever shortage there may be in the county deposit. The directors paid to the ceiver in cash and in securities and also assigned their interest in the Hohn which amount$25,000. The liability assumed by the ceiver will be the difference between the amount paid out depositors in settling up the bank and the amount which the county had deposit.

Rentals Meet Receiver's Expenses. For instance, the county had deposit, in the that per cent paid by the bank the county would receive leaving 40 per cent, or $17,678.10 which will paid out of the special fund paid to the receiver by the directors. During the time of the receivership all expenses, for every purpose, cluding the protection assets and the expenses of the receiver and employes, has been paid out the rentals and interest collected, and there has been the which has been brought for the creditors. believe that the showing made gives evidence that this trust being administered in the best interests all creditors and that Receiver Harto be congratulated the showing made.

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COURT DOCKET FOR FEBRUARY TERM

The criminal listed follows:

State John Knuffke; parole. State Fred Eigeman; parole. State Fellows; parole. State John Wassenberg, parole. State Gus Peachers; parole. State Peter Burke; parole. State Steve Skoch; parole. State John Koch; parole. State Wm. Wilder: parole. State Loyd Vaughn; parole. State Joe Black; parole. State Ray parole. State Phelps; parole. State Arthur Bealer; parole. State Phil Smercheck and Fred Katopish; parole. State Bert Shipp: parole. State August parole. State Justin Kluckner and MarBeasley; enticing for the garet State Frank Curtis; parole. State Fred Joseph; parole. State Arthur parole State Melvin Graham; attempt rape. State Max Cecil Garrett; parole State Ed. parole. Blue John Doe City Rapids commonly known Red Radford and Fred Smith; appeal from police

The Civil Docket.

Winters The Board of Mary Commissioners of Marshall County County, Kansas; damages. The Bigelow State Bank of Bige low, Kansas, Henry Wassenberg; action Implement Harry Hunt, of Weisendanger vs. Elmer Augustus, action on note. The Irving State Bank of Irving, Kansas, Mrs. H. Kleeman, recovery of money. Foye Wiley; of money Samuel Shroyer, Jesse aside deed Shrover, to Southwest Bond Mortgage Co. H. Hammett, et al.; action Oil Co. City of MarysDerby Kansas, al.; injunction. Harry Rogan, Grain HasRogan of money. recovery Everett McCarthy Kansas Guy Board; appeal. Blue Rapids Lumber Phelps, et foreclosure of mechanlien. Fred Crome M. Brychta; garnishment. Duver vs. Myrtle Duver; diRobinson Dave Donahue; from justice of peace. Newton, Iydia Balch, et foreclosure of mechanlien. Haskett Carroll Walker and Fred Barrett, partners the firm Barrett Walkname recovery of money. Burgner Bowman Lumber Co. Wheeler, foreclosure of lien. Margaret Brooks, vs. Russell Brooks: divorce. Thomas Harry Fannen, recission and concellation of tract and damages. Bond Mortgage Co. Wempe; recovery money Southwest Bond Mortgage Gertrude Schell; recovery of Hartford Fire Insurance Co. Union Pacific Railroad Co.; money. Lyman H. Armstrong George Morton, et al.; foreclosure The New England National Bank Fred Johnforeclosure of mortgage. Neilson, vs. Lillie Shroyer, partition. Marie McGeeney John McGee divorce. Augusta Fleischman, et al., Mabel Gordon, partition. Julia Paul Clarence Paul; attachment. Julia G. Paul C. H. Paul; tachment. Greenwood County Bank VS. Gordon, administrator, et al.; money. Carden Joan E. Pinkham; partition. The Citizens State Bank of Blue Rapids, Kansas, attachment. Bert McGurk VS. Paul Moseley, Carl Naaf Stokley Seat and Seat: recovery money. Frank Curtis VS. Ella Curtis; diHaskett VS. W. Rice; tion on contract for of recovery money. The Cities Service Oil Co. VS. Miles Kelley; recovery of money. den; attachment. Marksman Sam Myers: Harvey, receiver of First National Bank Marysville, Kansas Mohr: action contract. Iles John Behrens, Watters and John Montieth: action note. Hattie Wilson Marysville & Elevator Co., al.; action Hattie Wilson E. R. Fulton, action on note. Citizens State Bank of Marysville, Bauer, tion dismiss. The State Bank of Frankfort Henry Olney, al.; to quiet title. Verel Watts Clara Watts; Mabel Bell Frank Thomann, recovery of money and closure of mortgage. Frank Jandera L. Mullen: recovery August Peterson Schultz, quiet title. Mary Followell Rollie Follodivorce. Delia Gossin John W. Gregory, quiet title. Bueker and Ed. appeal from justice peace. The Griesa Nursuries Manrose: appeal from justice the Nellie Grauer, White, recovery money. Harvey, receiver of First tional Bank of Marysville, Kansas: the Marysville Mill Elevator of money. of the First Natinoal Bank Marysville, Kanof recovery money. receiver of First National Bank Marysville, Kansas. Hohn: recovery of money. Harvey, receiver of First tional Bank of Marysville, Kansas, Hohn; recovery money. Harvey, of the First National Bank of KanGeorge T. Mohrbacher; money. Harvey, receiver of the First National Bank Marysville, KanMinna Hohn, al.; closure mortgage. of the First National Bank KanHohn; recovery of stock Milgate C. Wells; plevin. Pauline Butler vs. Morris C. et Isaac B. Walker and Henry Thiele; appeal from justice of peace. Brady John Kluckner; confirmation of Sheriff's sale under execution.

Cases Not At Issue.

Veach Oliver M. Adams, recovery money. of the First Harvey, National Bank of Marysville, KanR. Wasser, closure of mortgage. Harvey, receiver of the First National Bank Marysville, KanFrank Gardner, closure mortgage. Sarah Gates, to quiet title. Hannah John Siders, quiet title. Dollie Oble Louis Oble; vs. Grace E. Munroe Davis, of mortgage. Mary Benedict, quiet title. Penney, Belle Crane Wm. R. Crane, partition. Williard Ewing; Haskett attachment. Haskett vs. Williard attachment. receiver of First Harvey, Bank Marysville, Kansas. tional Fulton, action and foreclosure of William Orch Orchard recovery money. Lutherian Swedish lem Church Carl Petterson, quiet title. Court Opens Monday, February Judge Fred Smith will the night, Februdistrict court Monday 7:30 o'clock, and the the list jurors: lowing Marysville City Vaughn Bone Irving Carl Peterson Blue Rapids Chas. Finn Guffee Marietta Jesse Howell Colvard Axtell Axtell Irving Geo. Reddington Chester Hunt Robt. Ford Bremen Krueger Axtell Earl Bergman

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THREE BANKERS NAMED

Six Marysville men have been indicted for bank failure. The principal charge against them is that they loaned too much of the bank's money to a business in which the six were interested. And what is going to make it hard for them is the fact that the federal government is back of the prosecution.

(By The Associated Press) TOPEKA, April 15.—Six Marysville business men, three of them bankers, were indicted this afternoon by a federal grand jury as a result of the failure of the First National Bank of Marysville. They were Edgar R. Fulton, president of the bank, and former state senator; Hugo A. Hohn, vice president; his brother, Emil A. Hohn, cashier; George Mohrbacker, president of the Marysville Mill and Elevator company; J. E. Riley, secretary-manager of the milling firm, and Joe Wasser, secretary-manager of the Blue Valley Packing company, of Marysville.

The three bankers were indicted on eight counts, involving alleged falsification of records and misappropriation of funds in connection with the mill's accounts, and Mohrbacker and Riley were named for aiding and abetting the bank officials. The bankers also were indicted with Wasser on six counts involving the account of the packing company.

One Firm Owed $97,000 Frank H. McFarland, assistant United States district attorney, who presented evidence to the grand jury, said the elevator firm owed the bank $97,000 although the national banking laws forbade the bank's lending more than $10,000 to one debtor. The bankers were interested financially in the mill, McFarland said, and were making an effort to save the milling company when market conditions were adverse.

Examiners found, the assistant district attorney informed the jury, that the bank had advanced the milling company $25,000 in one loan.

Drafts payable to the packing company, were run twice through the bank, McFarland said, and thus $30,000 was advanced to the Blue Valley organization when it was sailing in a financial storm. This $30,000, representing six drafts for $5,000 each, was listed among the assets, instead of the liabilities, of the bank, the district attorney said.

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SCHULTE RESIGNS AS ASSISTANT RECEIVER.

Joseph Schulte, local business man, has resigned his position as receiver the Farmers' National bank at Kas., and plans to re-enter the insurance with his brother. Schulte, with offices in the White building Mr. Schulte returned home day from Phillipsburg, where he served seven months assistant ceiver the defunct institution unReceiver Harvey, also of Previous to receiving the appointment there he served assistant receiver closed First Nationbank of Marysville under