836a768fBorrowed from banks or large institutions, Capital injected, Full suspension, Books examined
Other: Citizens' committee attempted capital injection; assets later sold to form City Bank & Trust
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Georgia Bank Fails to Open MACON. Ga. The Luther Willliams Bank and Trust Company Macon. state institution, failed to open for business morning. notice the of the bank said that due withdrawals of posits, advisable to order for the benefit of It capitalized Offiannounced the time closing amounted to approximately
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DOORS CLOSED BY LEADERS "Steady Withdrawal of Funds' Causes Decision to Suspend Payments Monday STATE BANK EXAMINER WILL ASSUME CHARGE The Luther Williams Bank and Trust company, independent banking institution, failed to open its doors Monday morning, following collapse of an effort to reorganize after many withdrawals had been made during the few The occasioned the recent and death of Francis E. Williams, president of the bank. statement issued by the citizens' committee representing force, was shown that the sum of $150,000 which subscribed and in Saturday's press not be to offset the became convinced with the increasing of the money entrusted to would not be drop bucket, and that the bank could not be saved
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The The Citizens Committee which endeavored, for four days, to the save Luther Williams Bank and Trust Co., from failure was confronted by the necessity of doing several things. The first was to save the bank; the second was make strong local bank that could continue operations within an ample margin of safety for the depositors and the third was the necessity for raising enough money to do that. When the committee began its work, was estimated definitely by what was considered good authority that $150,000 would be enough new capital to save the bank and to strengthen its structure that would be adequate to the needs of old and its its prospective customers. The raising in cash of the amount necessary the perfection new organirequired obtaining the consent of the prospective officers and eight new three Announcement was made of the committee's plans SO that the public might have full information about what it was trying do and also in the hope that the steady stream of which had begun the death of Francis E. Williams, the bank's executive vice-president, might be stopped until the reorganization could be effected and the bank was in condition maintain itself. The announcements did not stop the withdrawals. Thursday, there was net withdrawal of $38,000; on Friday, withdrawal $43,000 and Sunday ascertained that Saturday's withdrawals were "clearing house" run: that great many depositors were fearful anxious their money out, but did not want make personal on the bank. checks that passed through the Clearing House and the effect was depositors broke the bank. They made necessary the officials of the bank to resort heavy borrowing and drain the assets that payments might made them. They created such situation that the $150,000 of new which had been subscribed money Macon Citizens not sufficient to accomplish the purposes the Citizens Committee had in mind: salvation the bank the creation of strong bank. when the situation apparently hopeless early yesterday the Citizens Committee discontinued its efforts the bank closed for liquidation. The condition of the bank for purposes of estimating the possible dividends to be paid will not be known until an audit has made. The officers have contended solvent. One thing certain, however, cause certain all cases where banks are run: the not get as much under receivership they would have got if the bank had been allowed to continue its operation with the new capital and the direction. Banks not cannot be operated under conditions that they can keep enormous cash reserves idle. They must be ployed. When depositors demand their money instanter, bank that doing business properly, unless bulwarked by affiliated stitutions, meet demand. Banks are operated that they pay. lic. Had the Citizens Committee, which entirely disinterested financially and working only in the interest of the depositors and the community, the loyalty of the depositors to the extent that they were willing to the Luther Williams Bank breathing by from withdrawals, would been sible, undoubtedly, that committee to have worked the situation out SO that there would have been loss for the depositors. The committee willing to go even ther than gone to furnish guarantees of money had the depositors indicated their willingness cooperate by making merely the normal withdrawals. We have another illustration of the power fear in Macon. Storms of heit the protest greeted because, was his venture, the sterilized and deprived milk of its vital His effort was later qualities. pronounced Rockefeller Foundation's International the Health Board "the beginning of organized combat infant mortality effort by providmilk for ing absolutely artificially infants." Straus was ardent Mr. supporter of In the United Palestine world Jewry. Appeal he contributed $650,000 and spent an of million dollars other quarter establishing health centers in Jerusalem combat malaria trachoma. He established and food kitchens to feed people daily, regardless of race religion.
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CONDITION OF WILLIAMS BANK GIVEN IN DETAIL BY AUDITORS Following detailed statement of the condition of the former Luther Williams Bank Trust company, which closed Jan. 12, made public Friday by auditors banking department: PLEDGED ASSETS 30,844.95 525.17- 30,319.78 25,000.00 Liabilities 40,000.00 39,262.34 336,368.17 Net deficit to stockholders (The above not quoted replying fed. reserve eligible paper,' Mr. Dure assets that its element the face of $100,000 worth of the Georgia eligible paper to the fedtold efforts to comfederal reserve the morning run. time and they managed reach the the and the had closed. 10 o'clock the not eight the 11 o'clock persons the bank and then don't solvent Dure all vault. Referring to the Williams Mr. Dure declared that calamity this bank opened. He stated that he would glad to assist the tion the institution. The speaker was heartily applauded. The of the audit, by and company, certified public accountants. is elsewhere this edition The Macon Evening News. It shows the loss to depositdue shrinkage, to be The net shown $191,312.21. The total estimated the amount due depositors adjournment Mayor Toole called for an expression from the audience to number preswould accept stock bank in exchange for their deMany hands were raised The adjourned subject Mr his explanation of the stated ation for marThe when are will be in operation, stated. 5,630.67 3,562.29 2,068.38 5,319.78 314.317.20 5,700.00 National Bank: Bills receivable doubtful and worthless 209,824.67 35,950.02 Equity in Fulton National bank collateral 173,874.65 Chase National bank Bills receivable Less doubtful worthless 67,161.40 27,899.06 Equity in Chase National bank collateral National bank receivable $ 75,977.67 doubtful and worthless 1,586.32- 74,391.35 Equity Hamilton National bank collateral 24,391.35 First National Bank and Trust company Macon: doubtful and worthless 222.47- 136,469.08 65,000.00 Equity in First National Bank and collateral 71,469.08 First Atlanta doubtful and worthless Equity First National bank TOTAL PLEDGED Deduct: Secured Tax Collector Bonds doubtful and worthless deposit tax collector's collateral Equity Forwarded 2,068.38 314,317.20 Board of Water Commissioners Bonds 39,297.68 Add gain by appraisal 1,665.13 Less certificates of deposit 39,267.67 Equity Board Water Commission collateral 1,695.14 Bibb county: Less: doubtful and worthless 33.20 8,120.00 Less deposit 4,368.38 Equity Bibb county collateral 3,751.62 superintendent of banks: Bonds gain by appraisal 1,387.60 21,036.40 deposit 6,500.57 Equity superintendent of banks 14,535.83 22,050.97 collateral Equity in pledged assets Free Assets Bills Receivable $968,522.27 Less: doubtful and worthless 242,482.24 726,040.03 Cash 85,615.01 33,274.46 doubtful and worthless 4,009.66 29,264.80 Less: Due from banks 49,791.31 doubtful and worthless 1,538.21 48,253.10 Stocks bonds 14,614.13 Less doubtful and 813,18 13,800.95 Overdrafts 1,337.44 Less doubtful and worthless 632.12 Other resources 7,683.41 Less doubtful and worthless 927.35 Discrepancy account 2,751.87 Other 49,810.38 doubtful and worthless 14,051.38 35,759.00 Forward $948,946.14 Less doubtful and worthless 11,160.00 Furniture fixtures 14,626.56 Less doubtful worthless 9,626.56 5,000.00 Automobile 200.00 Add gain by appraisal 200.00 Total free 994,346.14 Total available for distribution $1,330,714.31 Liabilities be Liquidated Unremitted commercial certified standing 13,649.61 15,081.96 Free assets payment of unremitted collections $1,315,632.35 Depositors 1,449,465.37 Less secured deposits value 100 per cent capital stock asessments 64,094.44 1,385,370.93 Apparent loss to $69,738.58 Drafts outstanding Cashiers checks outstanding 17,212.53 Certified checks outstanding 1,167.85 Dividend checks outstanding 12.50 Accounts 21,573.73 Excess liabilities over amount available 91,312.31 Due stockholders Capital stock 100,000.00 provide for liquidating expenses).
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AUDIT SHOWS ACTUAL (Continued from Page One) ley, Mayor Glen Toole was Anderelected Milton Thomas Stewart and elected depositors' state banking departrelative the wishes the depositors. Nothing Dishonest Mr. Mobley the financial condition the bank, of the report blackboards the stage. had plaining that the which apparent depositors would be increased liquidation completed, Mayor Toole pressed his appreciation for the sistance the banking partment the matter. of bank," due to anything but natural which we find ourselves these times. There nothing dishonest about should make that elderly, coatless man spectacles his sitting the council not hear the speakhe inside the closure, and sitting councliman's desk. He Holloengineer on the G. railway Applause Stops Speaker knowing Luther liams there honester than Old Luther Williams. wouldn't better taking this per cent-to say 'here, keep money till you can make back that open your doors and Applause broke out everywhere. the engineer began to choke had half million dollars there, he the desk, doors and ahead nothhad Here applause stopped him, and the depositors hands Sobbing, Mr. Hollocontinued. time to tell Old Man Luther Williams doors He down again while sentiment the gathering. Mobley up again. audit does not disclose irregularhope advanced the hands. no reason should accept reasonable here thin, greyhaired man in little stock the Bankers Present Luther Williams, his sons, Frederick and Howard, dents bank. were the sitting among the depositors. the group citizens waged keep the "Lincoln McConnell." he said, active trying help. and probably more active than attempt reorganize refinance the the few its He deposiapplauded. He the seeking the two present banks over the assets the Williams institupay immediate dividend realizassets this second gages, pointed Then brought out the plan reopening the bank on the time certificate time certificates could be ranged,' the depostagree, the entirely feasible Applause stopped Going back the plan of bank. the said three years would needed accomplish liquidation Williams feel Mr. he said, he has example and tegrity long be showed that voiced feeling the crowd. He mentioned the name might the much told small group zens refinance funds being sapped clearing house proportions He how one was and how propped pledge the over long distance phone, asked the highest pledge, and matched for Georgia doors, panic that evident that the pledges would drain had taken $90,000 from the day. Then the bank's closed avoid the disaster of another Luther Cheered Luther Williams, whose bank used slogan "founded built summoned before the and from the time his called until he had made away applause such force years heard the hall. did intend say Williams, standing mayor just want thank anybody told would this would have the probably would have laughed he went his seat, Mr. Hollofix where don't He banks would have helped, but they don't the LuthWilliams Bank and company have nothing bank The chair recognized Ander- don't think scene of this kind any other the chairman of the and definite statement of what
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CONDITION OF WILLIAMS BANK GIVEN IN BY AUDITORS Following statement the the former Luther Williams which made Trust public the banking department: yesterday by for PLEDGED ASSETS 7,941.31- $212,973.46 3,148.7935,950.02 Fulton National Bank: Bills doubtful and worthless Equity Fulton National bank collateral Chase National bank: receivable doubtful and worthless 67,161.40 notes payable Equity Chase National bank Hamilton National bank: receivable 75,977.67 doubtful and worthless 74,391.35 payable Equity collateral National bank First National Bank and Trust Macon receivable doubtful and worthless 136,469.08 65,000.00 Equity Trust First National Bank and First National bank, Atlanta: Bonds 30,844.95 doubtful and worthless 30,319.78 Less: notes 25,000.00 payable Equity in First National bank TOTAL PLEDGED: Forwarded Water Commissioners: Add: gain by appraisal 5,319.78 314.317.20 5,700.00 5,630.67 3,562.29 2,068.38 2,751.87 33,759.00 Total available distribution Liabilities Unremitted commercial standing representing $1,330,714.31 13,649.61 15,081.96 Free after payment of unremitted collections $1,315,632.35 Depositors Less 100 per cent capital stock asessments 10,395.53 64,094.44 1,385,370.93 Apparent loss depositors $69,738.58 Drafts outstanding Cashiers checks outstanding Certified checks outstanding Dividend checks outstanding Accounts payable 21,573.73 Excess liabilities amount available 91,312.31 Due Capital stock 100,000.00 deficit stockholders 191,312.31 summary does not provide for liquidating expenses. they are willing do, the bank can and think and and do you think your duty Dure Leon president the Fourth doors 1928, after disand while the lifted He briefly about the Luther Williams bank closing something about run which killed the Fourth that bank nothing Fourth. simply bank had board directors more He old how the bank was jeopardby rumors which began streets. directors called the night the morning the run Taylor, the federal there, and asked what the federal would the event the next federal take eligible Mr. Dure Mr. Taylor replied. "Eligible Small "Eligible of assets its value element in the bank $100,000 worth of bonds the state Georgia, $10,000 loan eligible said. not bank time 10 and Then the started People packed the the floor, upper tried communicate system appeal for help. unable Dure said, and the time Washington reached the telephone condition became telephone conversation which might meant salvation and close its doors failure care how solvent stitution Dure said, respond to run all funds vaults. If doing nothing (the Bank and Trust company) not reopened.' Burden Urges Reopening Mayor Toole Burthe agents refinance the before doors closed Burden urged the institution, said that would to power co-opthat effort King made the motion that the certificates posit.' the would not Mayor Toole asked for sentiment the to taking stock bank Many hands went he many would accept for deposits. Almost the Before the Mr. Mobley filing claims depositors, this in complicate the reopening bank, would on the contrary simplify matter workable plan should attained. Apparent $69,738.58 The depositors the Baggs, certified public deficit $100,000 which resented capital stock, and the mainder which excess assets. due deThe report, authorized Mr. given table and shows detail liabilities and assets the instituIn cases computing evaluation for real and of market conditions. values liquidawhen the affairs would thus considerably lower than the bank and time recovery, Mr. MobThe matter of reorganizing the 173,874.65 24,391.35 71,469.08 2,068.38 314,317.20 40,962.81 Less: certificates deposit 39,267.67 Equity Board Water Commission collateral Bibb county: Bonds Less: doubtful and worthless 33.20 Less deposit 4,368.38 Equity Bibb county collateral 3,751.62 Mobley, superintendent of banks: Bonds 19,648.80 Add: gain by appraisal 1,387.60 21,036.40 Less: deposit 6,500.57 Equity superintendent of banks collateral 14,535.83 22,050.97 Equity pledged assets 336,368.17 Free Assets Bills Receivable Less: doubtful worthless 242,482.24 726,040.03 85,615.01 items 33,274.46 Less: doubtful and worthless 4,009.66 29,264.80 Due from banks 49,791.31 Less: doubtful and worthless 1,538.21 48,253.10 bonds 14,614.13 Less doubtful and worthless 13,800.95 Overdrafts 1,337.44 doubtful and worthless 705.32 Other resources 7,683.41 doubtful and worthless 6,756.06 Discrepancy account Other 49,810.38 ,Less doubtful and worthless 14,051.38 Forward $948,946.14 51,160.00 Less doubtful worthless 11,160.00 40,000.00 and fixtures 14,626.56 Less doubtful worthless 9,626.56 5,000.00 Automobile 200.00 gain appraisal 200.00 Total free assets 994,346.14
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PLANS PROGRESSING FOR NEW MACON BANK Goal of $100,000 Additional Capital in Sight, Says Announcement. MACON. Ga., May ance that new bank will be formed take over the assets of the closed Luther Williams Bank & Trust Compary was Wednesday following meeting of the committees working on the when it appeared the $100,000 additional capital was in sight. meeting to launch the new will o'clock when the expected to in hand. Early today balance of $22,000 was and the progmade during the day gave assu.ance of to the anrouncement of P. T. Anderson, chairbefore the Kiwanis Club at the hour, Mr. Antold the Horace Jones and Dr. Quayle. leading citizens of who had offered enter the financing of the new bank to the extent of $200,000 similar amount was raised by Macon people. looks as though Macon was sold everyone except Macon Mr. Anderson have been given until May 25 to work out the financing of the new bank or quit.' He then related that the commitwas within $22,000 of its goal and going out with effort complete work. The offer Cleveland still was thought desirable to accept it, The committee was not in position to announce the personnel of the new but may expected after Thursday's meeting.
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Grand Jury Probes Run On Macon Bank Macon, Ga. June origin alleged false reports which officials of the defunct Luther Williams Bank and Trust company said started an invisible which led to the closing of the institution last January 10 is being investigated by the Bibb county jury. Solicitor Charles H. Garrett has summoned before the grand jury between 40 and 50 witnesses. The investigation started this week. Solicitor Garrett the invest gation is being made on complaint of officials of the defunct bank and is without reference to any in dividual. CONSOLIDATION URGED The grand jury for Glynn Superior court today recommended the consolidation of city and county governments. The jurors also favored auditing the books of the justices of the peace of Glynn county.
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STOCK OWNERS WILL NAME OFFICERS An order signed by Judge H. Mathews in Bibb Superior court Tuesday authorizing sale the assets the closed Luther Williams Bank and Trust company. cleared the way for the opening Thursday of Macon's newest bankthe City Bank and Trust company Turner. president of the the hearing in which no entered. that meeting stockholders and board will be held Wednesday morning to complete the new organThe stockholders will meet 11 o'clock accept the bank's charter and adopt The directors the bank at Three Be Elected and R H be elected presidents of the new inGuyton Abney Mr Turner Both Mr and Mr King the depositors' comthe Williams bank and have instrumental the organization the new institution Mr Abney assistant cashier of Williams Officials the new bank had the day but was that the instiThursday July The sale Williams bank assets executed The order approving the sale of the assets for the signed by Judge noon petiHarry Strozier for while of Sparks represented the Bank Trust Election officers expected complete for named Mr Williams named and of the board To Pay Per Cent Mr Turner the will pay half per deposits Other the clearing pay per the the Macon Savings be opened the hours afternoon the day openper cent the entire deposits the Luther placed credit of
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ASSETS AT MACON Protection for Deposits of State Is Sought for Surety Company MACON. July approvng the Luther Williams Bank and Trust Company sets the City Bank and Trust Company was signed Tuesday by Judge Mathews Macon circuit. There was no objection to the Judge Mathews acted on petition of Mobley, state filed Bibb Superior Court several ago. Mr. Mobley recommended the the best in terest depositors. new bank. already chartered with capital stock of $110,000. will open Thursday. Rad Turner, engaged banking here last several years, new president The Luther Williams Bank and Trust Company being for 75 per and payments to made to signed several days ago and filed in Superior Court. Mobley was represented in the sale by the of Park Strozier while the represented by the firm of Brock. Sparks and In petitions filed here Tuesday the Luther Bank and Trust Company made efforts to have the court set up the deposit of state funds prior claims In each of the petitions was that Mobley had refused to recognize them first was filed by the Standard Accident transferee W. Spear state treasurer. When the bank closed, Mr Speer. had on deThe bank guaranteed the deposit and gave surety bond The bank failed and the surety company paid the amount to the state In action the surety company seeking establish prior claim on the bank petition was brought by Solicitor H. Garrett, of the Macon Judicial seeking to establish claim When bank failed Garrett had that amount on deposit, representing court costs bond forfeitures,