366. Farmers & Merchants Bank (Green Forest, AR)

Bank Information

Episode Type
Run → Suspension → Reopening
Bank Type
state
Start Date
December 17, 1930
Location
Green Forest, Arkansas (36.335, -93.436)

Metadata

Model
gpt-5-mini
Short Digest
610295ec

Response Measures

Capital injected, Full suspension, Books examined

Other: Reorganized and reopened under a new name with depositors agreeing to staged withdrawal schedule.

Description

Heavy withdrawals and runs prompted suspension on 1930-12-18; bank reorganized and reopened Jan 24, 1931 as the Citizens State Bank. Cause attributed to association with the Hudspeth chain (runs on related banks).

Events (3)
1. December 17, 1930 Run
Cause
Local Banks
Cause Details
Heavy withdrawals and runs sparked by association with the Hudspeth chain and the closing of other Hudspeth-controlled banks, producing depositors' unrest.
Measures
None specific beyond later suspension; heavy withdrawals forced bank to suspend.
Newspaper Excerpt
state banking took immediate action ... pending business today attributed heavy withdrawals of The three weeks developing from unrest depositors.
Source
newspapers
2. December 18, 1930 Suspension
Cause
Local Banks
Cause Details
Bank suspended/closed due to heavy withdrawals precipitated by runs related to the Hudspeth interests' failures and closings of other regional banks.
Newspaper Excerpt
the Farmers and Merchants bank of Green Forest. ... the Green Forrest institution had capital stock ... The state banking took immediate action to ... The banks closing vesterday and today did no' attempt to take vantage the five day provision ... closed outright.
Source
newspapers
3. January 24, 1931 Reopening
Newspaper Excerpt
The Citizens State, Bank is the name of new bank which opened in Green Forest, Saturday, January 24. The new bank is a reorganization of the Farmers and Merchants Bank, which suspended on December 18 ... The bank was in no way insolvent, but was forced to close its doors because of the general unrest of the public ... officers elected for the new institution ... all the whose balance $25 have signed not to withdraw for period of time: one-fourth in nine one-fourth in twelve months ... one-fourth in 18 months and one-fourth in 24 months.
Source
newspapers

Newspaper Articles (4)
1. December 18, 1930 The Courier News Blytheville, AR
Article from The Courier News, December 18, 1930

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Article Text

Institutions at and Green Forest Doors Today. LITTLE ROCK Two northwest banks were swept the state's already extended list defunct nancial institutions today the closing of the Peoples Bank of Berryville and the Farmers and Merchants bank of Green Forest. Both members of the twelve of which shut their doors yesterday. The Berryville bank was capitalized with deposits $177,835. and the Green Forrest institution had capital stock of with deposits aggregating $158.- The state banking took immediate action to nince the two banks the hands of department examiners. check complet this merning by Taylor banking commissioner. devosits of the Hudsoeth stitutions to anproximately with canital and surplus gregating action the two banks pending business today attributed heavy withdrawals of The three weeks developing from unrest depositors. Two of the banks closed the Marion County bank of and the Bank of Pyatt. DOYSESS charters and as the Citizens Bank of Yellville. but under senarate names the remaining nine pending yesterday. the First National hank of Harrison and the First National bank of Eureka Springs operate under national banking charters and have been placed in national bank examiner from the office of the The banks closing vesterday and today did no' attempt to take vantage the five day provision provided by state banking laws reorganization of affairs but closed outright. No plans for reprganization have been announced and believed the aftairs of the various will be the First National bank and the Scctland County Savings bank of Laurinburg were closed today. approximately In deposits.

2. December 25, 1930 The Star Progress Berryville, AR
Article from The Star Progress, December 25, 1930

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Article Text

Closing of Hudspeth Interests North Arkansas Causes Withdrawals on Bank Here. The Peoples Bank here failed to Thursday morning of last it being closed by orders of the board of directors to surpress which had developed caused twelve banks of the Hudspeth chain in Marion, Boone, Carroll and Searcy counties closing on Wednesday. It is said that this bank is vent but that was not in position to withstand run, evidences which had been shown for eral days prior to its closing, due to being member of the Hudspeth interests, and it neces. sary for it to close for the protection of its depositors. While awaiting the re-organization of this bank, has hampered business some extent, however, Berryville has not been without banking facilities at any time the First National Bank has mained open during this period of financial unrest. The closing of the Peoples Bank came as surprise to many citizwho had seen the two Berryville institutions remain open through the period of bank closings over the state, and was believed that the banks of Berryville, and Carroll county would the financial storm felt generally in the state and nation. is understood that persistent and growing tendency toward withdrawals had been reducthe cash in this bank for days. Some depositors had also been reducing their balances in the bank to the point where closing for short time was the only remedy. The situation in this part of Arkansas, differs from closings in other parts of the state, wherein the assets of the bank remained tact through conservative management, and withdrawals alone can be blamed for the situation. Over 90 Arkansas banks have suspended or closed for liquidation since November 17, when the ican Exchange Bank and Trust Company at Little Rock, closed. About have reopened or re-organized. The banks involved in this suspension are: Citizens Trust Co., Harrison. First National Bank, Harrison. American Exchange, Leslie. First National Bank, Eureka Springs. Bank of North Arkansas, Ever- Citizens Bank, Yellville. Citizens Bank, St. Joe. Bank of Lead Hill, Lead Hill. First State Bank, Marshall. Bank of Alpena Pass, Alpena. Marion County Bank, Flippin, Bank of Pyatt, are branches of the Citizens Bank at Yellville. closed when the parent bank suspended. The First National Bank and the Farmers Merchants Bank Green Forest, which were also closed Wednesday, were independently owned, the controlling stocks owned by citizens of this county. Out of the six banks operating Carroll County, only two remain open, the First National here and the Bank of Eureka Springs. understood that the closed institutions will again in open short time.

3. December 26, 1930 The Producers News Plentywood, MT
Article from The Producers News, December 26, 1930

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Article Text

TWELVE BANKS GO BROKE WEDN'SDAY Little Rock, Ark., Dec. 18.-The Peoples Bank at Berryville and the Farmers and Merchants Bank and the First National Bank at Green Forest closed today. A. T. Hudspeth, Little Rock financier, who had interest in 12 other banks in northwest Arkansas which closed yesterday because of heavy withdrawals was a director of the American Exchange Trust Company of Little Rock which closed last month. State banking department officials said his connection with the institutions caused the runs on the banks closing yesterday and today.

4. January 29, 1931 The Madison County Record Huntsville, AR
Article from The Madison County Record, January 29, 1931

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Article Text

Green Forest Bank Reopens With New Home Green Forest, Jan. The Citizens State, Bank is the name of new bank which opened in Green Forest, Saturday, January 24. The new bank is a reorganization of the Farmers and Merchants Bank, which suspended on December 18, following the closing of a chain of banks in Northwest Arkansas known as the Hudspeth chain, on December 17. The bank was in no way insolvent, but was forced to close its doors because of the general unrest of the public, the bank's officials having strong evidence that heavy withdrawals would be made by the depositors and force them to close. Thus, their movement of suspending business pending reorganization was a move calculated to serve the funds of the bank and its depositors. Officers elected for the new institution are: Lum AnderJ. J. Erwin, president; Logan Stafcashier, and assistant cashall the whose balance $25 have signed not to withdraw for period of time: one-fourth in nine one-fourth in twelve months. one-fourth in 18 months and one-fourth in 24 months.