6283. Peoples State Bank (South Bend, IN)

Bank Information

Episode Type
Run → Suspension → Closure
Bank Type
state
Start Date
October 8, 1930
Location
South Bend, Indiana (41.683, -86.250)

Metadata

Model
gpt-5-mini
Short Digest
3b6a5403

Response Measures

Full suspension, Books examined

Other: Receiver appointed (Western State Bank) and liquidation/assessments of stockholders followed; dividends paid later during liquidation.

Description

The People's State Bank (Peoples State Bank) in South Bend experienced heavy withdrawals that drained cash and, combined with frozen/illiquid assets, caused it to close in early October 1930. State officials petitioned for a receiver and the Western State Bank was later appointed receiver (Dec 1930). The bank remained in receivership/liquidation thereafter (stockholder assessments, dividends paid by receiver), indicating permanent closure. OCR errors in article text corrected (e.g., to-day -> today, ceiver -> receiver).

Events (5)
1. October 8, 1930 Run
Cause
Bank Specific Adverse Info
Cause Details
Heavy withdrawals (drainage of cash by depositors) combined with large frozen/illiquid assets (~$400,000) led to loss of liquidity and precipitated the run/closure.
Measures
Directors were called to confer with state officials to determine if a plan could be worked out to reopen; state examiners/audits involved.
Newspaper Excerpt
The bank ... closed its doors Wednesday morning ... drainage of cash on hand by the demands of depositors and frozen assets of nearly $400,000 were responsible for the closing.
Source
newspapers
2. October 9, 1930 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Bank closed due to inability to meet depositor demands and large frozen assets; state banking commissioner filed for receivership after closure when liquidity could not be restored.
Newspaper Excerpt
Luther F. Symons, state banking commissioner, to-day filed a petition ... asking that a receiver be appointed to take over the affairs of the People's State bank ... the bank ... closed its doors Wednesday morning
Source
newspapers
3. December 8, 1930 Receivership
Newspaper Excerpt
the recently organized Western State bank to-day was appointed receiver for the defunct People's State bank by Judge Fred Bingham ... Western State bank's appointment ... was endorsed by the state examiner ... Western State bank, receiver for the defunct People's State bank, asking total judgment ... on 100 per cent stock assessment ordered ... the defunct People's State bank ... the Western State bank, receiver for the defunct People's State bank ... receiver for the closed concern ... Western State bank, receiver for the defunct People's State bank appears repeatedly in later items.)
Source
newspapers
4. December 10, 1931 Other
Newspaper Excerpt
Judge Fred Bingham ... ordered 100 per cent assessment against all stockholders of the defunct People's State in order to make up part the deficit ... deficit of $363,811 ... liabilities include tied up savings accounts $123,082.79 checking accounts.
Source
newspapers
5. December 15, 1931 Other
Newspaper Excerpt
Judge J. Fred Bingham ... presented depositors of the defunct People's State bank with Christmas present. The depositors, who have total of more than $750,000 tied up in the bank, will be able to collect five per cent dividend on their deposits ... Western State bank, receiver for the Peoples' bank.
Source
newspapers

Newspaper Articles (10)
1. October 9, 1930 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, October 9, 1930

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Article Text

PEOPLE'S BANK RECEIVER ASKED State Commissioner Files Petition; Directors Seek Way to Open. Luther F. Symons, state banking commissioner, to-day filed a petition in Judge Orlo R. Deahl's superior court asking that a receiver be appointed to take over the affairs of the People's State bank, 1222 Western avenue. The bank, which has been in operation since 1919, closed its doors Wednesday morning and officials of the state banking department were called in to take charge. was explained that the drainage of cash on hand by the demands of depositors and frozen assets of nearly $400,000 were responsible for the closing. A hearing on the petition for a receiver will held before Judge Deahl Tuesday morning, Oct. 21. In the meantime the directors of the bank will be called together for a conference to determine whether to some plan can be worked out to reopen the institution. It was explained to-day that the conference will be held within two or three days after the state officials have completed audit of the bank's books. "It is not a certainty that a receiver will be named," Thomas D. Barr, state bank examiner in charge of the institution, said to-day. "It is merely on the part of the state. It is possible that the directors and other bankers of the city may be able to work out some plan of relief and provide for payments on the deposits." Stanley J. Chelminiak, secretary cashier of the bank, said he believed the bank would be reopened.

2. December 8, 1930 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, December 8, 1930

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LEGION REFUSES TO SELL AUTO LICENSES TERMS OF MAYR Reorganized Western State Bank Named Receiver of Defunct Group COURT FIGHT CHOICE BY BINGHAM R. Montgomery, New Vice President, Says Opponents Lacked Money. WEST SIDE KEEPS AGENCY State Examiner Endorses Outcome of Controversy Over People's State. three weeks' factional After struggle interspiced with court tangles the recently organized Western State bank to-day was appointed ceiver for the defunct People's State bank by Judge Fred Bingham in court No. Judge Bingham made the appointafter lengthy controversy in during which the faction led by John Rozplochowski, deposed president of the Western bank, argued for the appointment bank to liquidate the funds the old bank few before the court decision State Bank its Examiner David Harris announced that as representative the state banking department he favored the Western State bank's appointment providing could produce the before entire its capitalization amount assuming the receivership. Attorney Attacks Idea. was met by His recommendation from Lenn Oare, one attack flery the attorneys for the factions opWestern bank appointposing the are you making such recwhen State Banking ommendation Luther Symons and Commissioner Examiner Thomas Barr informed us would make no recommenthat they whatsoever to the receiverdation demanded. directing the fight to Among those of the Western procure appointment was Chesin court mayor ter of the bank. first vice official after the He made an resignation of Mr. and subsequent substitution of four directors. Mr. Montgomery. who reviewed the the new bank. chargthat six directors of the People's bank who retained their positions in the original organization the Westbank were found owe about $60,000 the defunct bank. These directors money the bank notes and mortgages, many of long past he said. were "Capital Not Available." He also charged that after the faction which he member took over the Western bank was revealed that of the $25,000 which reported to hand not available. disclosed. he said, that one the stockholders borrowed the $16,000 from building and loan asbut was permitted withdraw the money from the assoCharles Lewinski, opposattorney aided in the ganization of the Western bank, plied that the $16,000 was borrowed and deposited the credit of the Western State bank although there an agreement that would not withdrawn immediately. It was the original intention of the organizers of the Western State bank provide an agency on the west side the liquidation the Peoples' State bank and that eventually the would be Joseph stockholder the Peoples' bank broke members the directorate when the Western Bank organized under Mr. Rozplowski, said that the present could be to the that six of the nine directors the old bank owed the institution when it closed During the argument Mr. Oare depositors want the Eight. Column

3. December 10, 1931 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, December 10, 1931

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LEVY PLACED ON STOCKHOLDERS Must Help Make Up Part of People's Bank Deficit. Judge Fred Bingham in superior court to-day ordered 100 per cent assessment against all stockholders of the defunct People's State in order to make up part the deficit revealed in an appraisal of the bank's assets and liabilities. The stockholders hold capital stock value of $50,000. According order Judge Bingham assessments must be within days. Petition was filed by the State bank, receiver for the defunct institution, Wednesday along with inventory showing deficit of $363.811. appraisal listed assets only and liabilities The liabilities include tied up savings counts $123,082.79 checking accounts.

4. December 15, 1931 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, December 15, 1931

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ASKED Court Grants Five Per Cent Dividend to People's State Depositors COUNCIL TO BACK ISSUE Takes HUNT WIDENED $37,892 TO BE Shopping Seriously Hunt North Liberty Bank Bandits. FOR $350,000 TURNED OVER IN ROBBERY AT ON WEDNESDAY Bingham's Ruling Follows Petition by Bank, Acting as Receiver. FRANKLIN TRUST CASE SET Pyle Fixes Dec. 24 for an Accounting to County; School Brings Suit. Judge J. Fred Bingham in superior court No. to-day presented depositors of the defunct People's State bank with Christmas present. The depositors, who have total of more than $750,000 tied up in the bank. will be able to collect five per cent dividend their deposits any time after Wednesday. Judge Bingham's order for the dividend was made on petition presented by the Western State bank. receiver for the Peoples' bank. showing that the receiver has $52.574.01 cash on hand. The five per cent will to $37.leaving the undistributed balance. Against this balance, however, are claims aggregating $13,336.96. During the last year, the petition shows, receiver has collected $117,019.85 and has paid out $64,445.84 in claims. Judge Bingham's order is effective Dec. but checks on the five per cent dividends will be available bank after Wednesday. John Niemic, attorney for the receiver, said to-day. Tax Anticipation Warrants Would be Sold Under Bill. NOT DUE TO MANAGEMENT Plight Traced to Frozen Assets in Closed Banks, Says Knoblock. For the first time in its history the city is faced with serious shortage of finances with which to meet current expenses, it was revealed Monday night when bill authorizing issuance of $350,000 worth of tax anticipation warrants was introduced and referred to the committee of whole. City Controller George A. Knoblock said to-day the shortage due to frozen assets in closed banks where city funds had been on deposit to delinquencies the payment of taxes. The confronting the city not due to anybody's mismanagement but to conditions over which the city had no control,' he said. If the issue is authorized by the council the would be sold in anticipation of taxes be collected next spring. The maturity of the warrants would be 150 days and they would bear interest at the rate of five per cent per annum. propose sell worth of the warrants soon as the issue is approved.' Mr. Knoblock said, "and reserve the other $150,000 worth for As the result of action taken Monday night $39,000 will be appropriated from the general fund to the street lighting department $200 will be alloted to the board of public works for the balance of the city's share to Twyckenham bridge; $3,100 will be spent for combination ambulance and police patrol and $11,425 for new fire department equipment; $1,250 will go to the finance department to pay the premium on the $250,000 surety bond in behalf City Treasurer Duncan Campbell handling the Barrett law fund. Ordinances regulating peddlers and transient merchants were adopted.

5. August 18, 1932 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, August 18, 1932

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CITY WEST SIDE TOLD Track Elevation Dispute Throws Civic Group Into Turmoil. Charges that the city administration "stalling" and won't continue the west track elevation fight any further turned the quarterly meeting the can Central Civic committee into turmoil in St. auditorium Wednesday night. During the fiery demands were that organization alter its constitution by-laws and enter politics, making the track elevation its issue in the mayorality campaign next year. The demands voted down, The meeting got off to hectic start when accusations were leveled upon City Attorney Walter Clements for failure file briefs feedral court Wednesday the battle west side citizens with the New York Central railroad over speed of trains the city to eight miles an hour. The enter politics militant voiced by Bert Peter Valentine M. Sparazynski. The Rozewicz, president of the organization, Francis K Czyzewski, secretary, succeeded in killing the proposal. report on local utility rates and the progress of the civic battle for reductions was made by Anthony proposition to change the liquidating agent of the defunct People's State bank from receiver liquidator expedite liquidation quashed. resolution was passed offer four-year scholarship to Hedwige High school An apthe Polish peal cieties in South Bend and Mishawaka to contribute the fund for the Hausthe Polish

6. September 16, 1932 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, September 16, 1932

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FILED AGAINST Stockholders of Defunct People's State Bank are Named. Seventeen stockholders of the funct People's State bank were named in suits filed in the three courts today by the Westcounty ern State bank, receiver for the closed concern, asking total judgment of $24,325 on 100 per cent stock ordered supericourt No. Dec. 1931 and which was due Jan The all of which are identical with the exception of the amount of reveal that closed liabilities the asEach of stock par value of 100 per cent the stock is worthless at the time, according the Filed in Circuit Court. Those and the amounts asked in suits filed circuit court are: Helen 450 South Carlisle street, $350; Kaz450 South Carlisle mierz street, 10 shares, $1,300; Lott Korpal, West Napier street, shares, $700; Michael Hazinski 306 South Chapin street, five shares, Joseph Krol, 441 South $700; and Jackson street, four shares, $600. Those filed superior court No. the following: Joseph are against Wypiszynski, 321 Wakewa place, shares, $10,000; John Buczkowski, 1401 North Olive street, share, $200; Louis 1826 East boulevard, four shares, $575; Wladyslaw rural route four, New Carlisle, this county, five $800; Wypiszynski, Wakewa place, five shares, $800; 321 and B. 1121 Western avenue, one share, $200. Interest and Fees Asked Suits filed in superior court No. against following Mary are Continued Page 14. Column

7. September 19, 1932 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, September 19, 1932

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SIX MORE SUED IN CLOSED BANK Suits were filed in superior court No. today against six more stockholders in the defunct People's State bank asking a total ment of $2,200 on 100 per cent stock assessment ordered and due several months ago, according to the Western State bank, receiver and sponsor of the suits. Those named were: Alex Langel. 303 South Chapin street, four shares, $600; Michael Krol, 1028 Western avenue, two shares, $350 Marceli Latkowski. 2126 Lincoln Way West, two shares, $350; Leo H. Kruszewski, 1125 West Birner street, one share, $200; Joseph W Kara and Anna Kara 2306 West Washington avenue, four shares, $550. and Ignacy Lipinski, 1019 Western avenue, one share, $200 The assessments were ordered to aid in offsetting liabilities of the bank which exceed the assets by $498,399.60.

8. March 31, 1933 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, March 31, 1933

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SUIT ASKS FOR COURT RULING ON STATE ACT Constitutionality Hit in Action Filed by Arnold. BANK RECEIVER JOINS FIGHT Parker Points to Possibility of County Levy for Payment. Constitutionality of the intangible tax law passed by the recent Indiana general assembly was challenged today on 12 points in a suit for declaratory judgment filed by Walter R Arnold. president of the St. Joseph County Bar asso- The law. affecting about 35 per cent of the state's population or approximately 55,000 citizens of St. Joseph county, was attacked in the suit as in violation of both the state and federal constitutions County Clerk Frank N. Nevins and Adrian Ross. defendant in promissory note judgment are made defendants The suit was filed in superior court No. and Judge J. Fred Bingham will be called upon to make the first judicial ruling in Indiana on the new law Lutz May Argue Case. Attorneys said the usual procedure calls for notice of the suit to be sent to State's Attorney General Philip Lutz. jr., in Indianapolis. He will either appoint a deputy to argue the case here or appear personally in behalf of the state to defend the law's constitutionality County Clerk Nevins is involved only as technical defendant, as also is Ross, for purposes of the test case In the petition to be filed by the bank receivers all county and state officials connected with the tax its collection will be made defendants. Simultaneously it was announced today by Orie Parker, attorney for Miss Ethel Weaver, receiver of the People's State bank, that an intervening petition would be filed in connection with Arnold's suit, asking Judge Bingham to suspend of the tax law as far as it affects the liquidating Taxes Bank's Judgments. Parker explained that the bank's assets include approximately $160,000 in judgments, all subject to the new tax The receiver, he said, has no funds to purchase the intangible tax stamps and if it is not paid within 10 days it delinquent, with the result that the tax is increased four times Since the bank receiver is an officer of circuit court, the attorney pointed out, it becomes the duty of Circuit Judge Pyle responsibility for payment of this tax. He in turn must go to the county council for an appropriation. Consequently, he said, the intangible tax when applied to banks in receivership creates the absurd situation of the county levying funds with which to pay state tax. Among reasons cited in Arnold's suit for the unconstitutionality of the law is one alleging that the whole legislative session was invalid because no enumeration and reapportionment of representatives has been made in Indiana since 1921. The state constitution, section No. article No. 4, says that the assembly must Continued on Page Eight. Column Five.

9. July 26, 1933 The South Bend Tribune South Bend, IN
Article from The South Bend Tribune, July 26, 1933

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ACT TO SEIZE ZABIK PROPERTY Foreclosure action on the property of Mr. and Mrs. John Zabik, 2630 Western avenue, has been started by the Polish Roman Catholie Union of America. In a suit filed in circuit court judgment of 500 on a promissory note made out Sept. 10, 1930, is asked together with a receiver to collect rent on the property which was mortgaged to secure the note. Named as co-defendants who may have interests in the Zabik property are the Polish Savings association, 1206 Western avenue, Western State bank, receiver for the defunct People's State bank. and the Lock Joint Tube company, of South Bend.

10. April 13, 1934 The Indianapolis Star Indianapolis, IN
Article from The Indianapolis Star, April 13, 1934

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BANK TO PAY $35,882. SOUTH BEND April Deposit in the closed Peoples State per dividend April the result of petition filed John Niemic at torney for the Western State receiver the closed Superior Judge Fred Bingham will be asked dividend, which total