Farmers & Traders State Bank

Bank Information

Episode Type: Suspension → Reopening
Bank Type: state
Start Date: October 31, 1907
Location: Leon, Iowa (40.740, -93.748)

Metadata

Model: gpt-5-mini
Short Digest: 38765638467d4923

Response Measures

None

Description

Article (Leon Reporter, 1907-10-31) describes the bank and other county banks adopting temporary limits on currency payments (paying out currency only on checks in most cases; $5/day, $15/week limits) as a precaution during the eastern stock-market 'flurry' (1907 panic). This is a temporary suspension/limitation of cash payments driven by macro news; the bank remained open and business continued, so classify as a suspension with reopening. No depositor run or receiver mentioned.

Events (1)

1. October 31, 1907 Suspension

Cause: Macro News
Cause Details: Precautionary limit on currency payouts due to the stock-market flurry in New York and city banks refusing to pay currency to country banks (1907 panic/financial disturbance).
Newspaper Excerpt: they had adopted a temporary rule to pay out currency on checks only in cases of necessity, and in no case would they pay over $5.00 in one day or $15.00 in one week on any one account
Source: newspapers

Newspaper Articles (1)

1. October 31, 1907 The Leon Reporter Leon, IA

Article from The Leon Reporter, October 31, 1907

Click image to open full size in new tab

Article Text

OUR BANKS ALLRIGHT In Order to Protect their Depositors They Decide to Use Checks and Drafts instead of Currency. There was some little flurry created in this county Wednesday morning when notices were posted atevery bank in the county, announcing that in order to protect their depositors and conserve the banking interests of the country, and acting in accordance with the banks of New York, Chicago, Kansas City, Des Moines and throughout the country, they had adopted a temporary rule to pay out currency on checks only in cases of necessity, and in no case would they pay over $5.00 in one day or $15.00 in one week on any one account, but as soon as the actual condition becamo known everything quieted down and business is moving along as usual. This very unusual money condition is caused by the flurry in the east, and while the banks of Iowa are all in extraordinary good condition, they are hampered on account of the banks in the cities refusing to pay currency to the country banks, and in order to protect all the banks from possible runs and demorilization of business, they decided to temporarily do business with checks and drafts in place of handling the currency. Take for instance the case of the Farmers & Traders State Bank of Leon. They have on deposit in banks in Des Moines, Ottumwa, Keokuk, Joe, Chicago and other cities over $110,000 which is subject to call, but they are unable to secure currency on account of the rule adopted in the city banks to pay in checks and drafts instead of currency. It is just as easy to do your business for a few days entirely by check, and if you have money on deposit in any bank in Decatur county the business men of Leon or any of the other towns will be only too glad to accept your check in payment for goods or in settlement of your account. There is no occasion for anyone to become alarmed or uneasy, for the present condition is caused solely by the flurry in the stock markets of New York, and the banks of that city have drained the western banks of their currency for immediate needs. The banks of Decatur county are all on a sound and safe basis, and if their customers will assist them for a few days it will not be long until normal conditions are again restored. Another thing, if you have any money on deposit and would prefer to have a draft on Chicago, New York, Des Moines or any of the larger cities, any of the banks will issue the draft in exchange for your check. Again we desire to impress upon our readers that there is no panic or chance for bank failures in this locality. It is simply a precautionary measure which they have taken to prevent any such occurrences. If you have any money in a bank rest easy. It is perfectly safe. The Leon Commercial Club having investigated conditions have no hesitation in endorsing the action of the banks of Decatur county, believeing that it is to the best interests of all and that in a short time it will restore business matters to their normal condition. LEON COMMERCIAL CLUB.