Article Text
IN MONON, IND. By Associated Press. Ind., Feb. Farmers & Traders State bank, Monon's only has been closed by order of the after run on the institution which started
6091. Farmers & Traders State Bank (Monon, IN)
Bank Information
- Episode Type
- Run → Suspension → Reopening
- Bank Type
- state
- Start Date
- February 1, 1930
- Location
- Monon, Indiana (40.868, -86.879)
Metadata
- Model
- gpt-5-mini
- Short Digest
225b5763
Response Measures
Full suspension, Books examined
Other: Used depositor waivers and reorganization to reopen; appraisement by outside bankers and state examiner involved.
Description
A run (withdrawals and rumors) led directors to close the bank and the state banking examiner took charge. Depositor waivers and reorganization were used; the bank reopened about a month later (reorganization and waiver plan). Dates approximated from newspaper publication dates.
Events (3)
1.
February 1, 1930
Run
- Cause
- Rumor Or Misinformation
- Cause Details
- Rumors and gossip (including talk following resignations and prior local bank failure) produced steady withdrawals in January and early February; ~$30,000 withdrawn in January and continued withdrawals in early February.
- Measures
- Directors chose to close bank to prevent further withdrawals; state banking examiner called in; plans to solicit depositor waivers and reorganize.
- Newspaper Excerpt
- Unjust and unfounded rumors forced us to close our doors.
- Source
- newspapers
2.
February 5, 1930
Suspension
- Cause
- Rumor Or Misinformation
- Cause Details
- Board of directors closed the bank Wednesday afternoon to halt a run driven by rumors; state banking department/examiner took charge to audit and stabilize institution.
- Newspaper Excerpt
- T. D. Barr, deputy banking commissioner, of Indianapolis took charge of the Farmers and Traders State bank, which closed Wednesday afternoon.
- Source
- newspapers
3.
March 12, 1930
Reopening
- Newspaper Excerpt
- MONON BANK IS RE-OPENED ... the Farmers and Traders Bank having opened its doors last Wednesday following reorganization. Its doors were closed to prevent run when rumors became prevalent about two of its officers resigning and the board of directors closed the bank and asked an examiner to make an investigation.
- Source
- newspapers
Newspaper Articles (8)
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Article Text
TOWN OF MONON WORRIES ALONG WITHOUT BANKS Efforts Under Way to Reopen Farmers and Tradders Bank. THINK BANK SOLVENT For the first time in many years Monon went grimly about its business this morning without local banking facilities of any kind, while T. D. Barr, deputy banking commissioner, of Indianapolis took charge of the Farmers and Traders State bank, which closed Wednesday afternoon, and prepared to unravel the present difficulties and stabilize the financial situation as rapidly as possible. When the bank closed Wednesday afternoon the books were left just as they were, and the banking department called. Mr. Barr was at work this morning making an audit. He refused to make any public statement, but indicated his belief that the institution was solvent and that a way would be found to reopen at an early date. The general impression is that if Mr. Barr finds the condition of the bank satisfactory, that a meeting of depositors will be called, and a committee of five, the majority to be non-stockholders, selected, who will go over the papers and books. If this committee reports favorably, then an effort will be made to secure written waivers from depositors not to withdraw their funds over a certain period of time, an arrangement simiar to that used when the National Bank was reagened here. This would prevent continuation of the run which caused the closing of the Farmers and Traders Bank Wednesday. If this solution is worked out, it is possible that the bank may reopen within the next week or ten days. It is likely that a reorganization will take place, and a new board of directors and new officers elected. At this time there is no talk of the formation of a new bank to take over the resources and assume the liabilities of the old institution, and this method will not be attempted except as a last resort. Bank Solvent Officers of the bank issued the following statement to the press this morning: "It is our conscientious opinion that our assets are sufficient to pay our depositors in full if we are given time to realize on them. Unjust and unfounded rumors forced us to close our doors. We will do all we can to reopen them. J. S. Minch; President. W. J. Hinkle, Vice Pres. John H. Smith, Cashier. C. A. Thacker, Director." Officials of the bank said that, fearing lack of public confidence following the failure of the Monon State Bank last fall, they carried a reserve of $80,000 to $90,000, an unusually large amount for an institution with total liabilities of only $300,000. Withdrawals began to be made soon after the State Bank closed, but the officers of the Farmers and Traderes bank did not think anything of the matter until after the first of the year. During January $30,000 was taken out. Friday gossip and rumors began to fly about town, and Monday a quiet but steady run on the bank started. Monday and Tuesday $15,000, mostly in cash, was withdrawn, and Wednesday $8,000 had been taken out, when the directors met and decided to close the bank before the run assumed the momentum of a panic. It was said that at the time of closing the bank had a reserve of $27,212, divided as follows: Due from banks and trust companies, $18,148; securities, $2,000; currency on hand, $7,000. Officers stated they could probably have withstood the run until the regular daily closing time at 4 o'clock, but they decided allow those who were making to have any preference. Mr. was said, the officers of the bank that they did the right thing (Continued
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Article Text
Only Remaining Bank Monon Closed In The Farmers and Traders State Bank of Monon, the only remainbank in Monon was ing afternoon by Wednesday Board of Directors. der of the understood that moderate run the bank had been prosince Monday following of the officers of that some the bank intended resign. It understood that the bank the directors to closed by and that further prevent the State Bank have asked they and is Examiner take charge time that the bank thought this short time if within open the state officials find the bank solvent and in good condition.
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BANKERS ARE TO APPRAISE ASSETS Solvency of Monon Bank To Be Determined— Waivers Prepared. Four neutral bankers, to make an appraisement of the debts and assets of the Farmers and Traders State bank, at Monon, were selected at a meeting of the stockholders Wednesday night and expected to have completed the task by this evening. They included: J. L. Beaseley, Francesville, Joe Hammond, Rensselaer, Fred Dahling, Reynolds and Clarence Downey, Monticello. The claim of the Monon bank officials that the bank is solvent will be determined by the report of this outside group. The stockholders agreed to sell some of their stock and enlarge their number from Waivers will be sent out to all depositors with the following proposal; for the first thirty days, fifteen per cent on deposits; the next three months, twenty -five per cent, for the second three months term 25 per cent, and at the end of the year 35 per cent. This will give the bank officials a year's time to cover deposits and would safeguard against a continuance of the run which caused the bank to close. If this proves successful the bank would be reorganized at the end of the year, it was said. W. K. Fraizier, of the state banking department, presided at the meeting.
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Bankers Inspect Monon Situation MONON, Ind., Feb. committee of made up Joseph Hammond, of the Farmers' and Merchants' National bank Rensselaer: L. J. Beasley, of the Francesville State bank, Fred Dahling. of the bank of Reynolds, and co-receiver for the Monon State bank, and Clarence Downey, of the White County Loan and Trust company at work appraising the notes and assets of the Farmers' and Traders' State bank here. The opinion of this group is sought on the stability of the institution, as a part of the gram which proposes of the bank. The commit and its function was suggested at meeting of the stockholders, of whom there are 38. The re-opening plan calls for an increase in the number of stockholders to 100, to be accomplished division of the present stock. five depositors has completed an inventory of the bank's assets and is said to have made a report favorable to re-opening
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Monon Is Hard Up, Just Like Chicago Chicago is not the only town that is temporarily broke. Monon is just as hard up, but for a different reason, of course. Politics put Chicago on the rocks, but the closing of the Farmers and Traders Bank tied up the Monon municipal funds. The customary bills were allowed at the meeting of the town board this week, but held over until warrants on the bank could be made payable.
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PLAN TO REOPEN MONON BANKSOON Hope to Have 100 Stockholders, 9 on Board of Directors. Depositors representing over $100,000 have signed waivers and officials of the Farmers & Traders Bank of Monon are certain that within a short time the institution will be reopened and ready for business, according to an article in this week's issue of the Monon News. The total deposits at the time of closing amounted to something over three hundred thousand dollars, so about a third of the waivers have been secured. The depositors of the bank held a meeting at the school house at Monon Monday evening, and the situation was explained to them by W. K. Frazier, deputy state banking examiner. He suggested a reorganization of the bank with a hundred stockhold. ers and nine new men on the board of directors. The News says in part: Mr. Frazier stated that "this is not the first bank to close, nor will it be the last one." He said that no bank can stand a run, no matter how big it is. He complimented the Farmers & Traders Bank when he said that "the books are absolutely clean, and are the best books I have ever seen." He stated that "no one will lose a penny," and that "if you want to kill your bank, draw out your money." The speaker explained the cost of throwing the bank into the hands of a receiver, and he said if that was done, the depositors could not get all their money out, and if they did it would take in the neighborhood of five years, which is the average in liquidating a bank's business under such conditions. Mr. Frazier related several instances where he had taken charge of banks similar to this one in Monon, and showed the folly of some people in not taking the easiest and most profitable course in solving the problem, and that was by allowing the institution to reopen. Coupled with his experiences he gave his hearers some sound advice which no doubt will be heeded at this time. Mr. Frazier also made it plain that a plan was on fopt at this time to punish the party or parties who started the run on the bank, and "do not be surprised if you are called before the grand jury," he said. The committee appointed as the depositor's committee, when the bank first closed gave as the appraisement of the bad paper the bank had on hands at around $11,000. When the committee of bankers from surrounding towns, which met last Friday, went over the paper, their figures were within $564 of the depositor's committee and Mr. Frazier complimented the actions of the two committees. The shares of stock, which are going to be sold by some of the stockholders in order to allow larger number interested in the bank, will be sold at $100 per share. A standing vote was taken at the depositor's meeting, and unanimous consent was expressed to sign the waivers and get behind the institution for a bigger and better bank.
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MONON BANK IS RE-OPENED AFTER BEING CLOSED FOR ONE OFFICERS CHOSMONTH-NEW EN-REORGANIZATION Monon again has a bank after a month with no banking institution, the Farmers and Traders Bank having opened its doors last Wednesday following reorganization. Its doors were closed to prevent run when rumors became prevalent about two of its officers resigning and the board of directors closed the bank and asked an examiner to make an investigation. This done and the reorganization perfected. The number of stockholders was increased from 38 to 75 and meeting of them resulted in the following being chosen as members of the board directors C. Russell, Dr. George Clayton and C. A. Thacker of the old board, Wm. Raney, H. H. Hanway, William: Long, Alexander Penniston, Clifford Cochell and Paul Morrell. A meeting of the directors was then held and the following men chosen as officers of the reorganized George R. Clayton; 1st Vice- Pres., William E. Raney 2nd Vice-Pres., William Long. John H. Smith is retained as cashier, Miss Minnie Rogers, assistant cashier, Miss Clara Wilson, bookkeeper and J. B. Dodd, manager of the insurance department. W. K. Frazier, representing the state banking department, who has had charge of the bank, during the time it was closed left Wednesday for his home in Muncie. Joseph S. Minch and Wright J. Hinkle, president and first vice-president of the bank for several years, resigned before the stockholders' meeting was held last week. As part of the reorganization plan carried out by Mr. Frazier, were signed by practically all the depositors, which guaranteed the return of their money within year, by allowing 15 per cent within three months, 15 per cent within months, 35 per cent in nine months and the 35 per cent at the end of the year. This arrangement also run the bank, and insures the institution an opportunity to establish its business connections. Baskets of beautiful flowers were presented bank on the occasion its re-opening last week by the Holden Green House of Rensselaer and Phil Wood of the Cody Trust Company of Bloomington, Illinois. The first day's business was $18,240.26 from 120 depositors.