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SHAPARD BANK CLOSED EXAMINED UNDER THE NEW STATE LAW. Old Opelka. Institution Could Not Pass Investigation of Examiner Rutledge and Receiver Will be Named. The Shapard Bank of Opelika, one of the oldest State banking Institutions of East Alabama, has closed its doors as a result of the operation of the new State banking law. Investigations under the law disclosed the fact that its capital stock had been impaired by bad loans. The doors of the bank were closed Friday by State Bank Examiner T. J. Rutledge. A time lock was set upon the assets of the bank until a receiver should be appointed. The bank is the first to be closed under the State banking law passed by the last Legislature. The bank was not closed directly through the process laid down in the law, but its condition was ascertained In investigations conducted in compliance with that law. Having reasons to doubt the stability of the bank, Examiner Rutledge went to Opelika, Friday, and after a conference with the officials the doors of the bank were shut until they should be opened by the receiver. The bank was nearly thirty years oil, having been founded by the late William Shapard. It was capitalized at $50,000. and had deposits amounting to $100,000. Its officers were C. C. Torbet, president. and William Poterfield, cashier. No intelligent statement can be made as to the aseets and liabilities of the bank until the receiver shall take hold. The direct downfall of the bank is attributed to the continuous accumulation year by year of bad loans. It will be recalled that in January. Bank Examiner T. J. Rutledge, acting under orders from Treasurer J. Craig Smith, called for a statement from all the banks of the State as to their condition at the close of business January 11 The report sent in fro mthe Shapard Bank was not satisfactory to the State bank examiner.H went to Opelika and conducted an investigation into the books of the bank. Treasurer Smith was notified that the bank's capital was impaired. He in turn notified Governor Jelks who instructed the Attorney General to begin proceedIngs against the bank. In the meanwnile the bank officials agreed that the doors of the institution should be closed. The operation of the law after a bank Is found to be insolvent, is extremely circultous. The Bank Examiner notifies the treasurer and the treasurer notifies the Governor, who instructs the Attorney General to proceed in the courts to close the bank. After the bank is closed the receiver is appointed by the chancellor of that division. The receiver for the Shapard Bank will be named by Chancellor W. L. Parks. While a good many citizens of Opelika may be losers by the failure of the bank, it is not thought that it will have any serious effect upon the business life of that city, as the other banks are said to be very strong.
