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NORFOLK, April 8, 1885. The suspension of the Exchange Natimbal Bank this morning has caused great excitement and almost paralyzed buthers. Crowds have thronged Main street and gathered about the bulletinheards. and even women have paraded the streets in great excitement. Net long after the Exchange Bank closed it was announced that Bain & Brother. benkers in Portsmouth, had suspended, and the excitement increased. Then the Tranklin Savings, which had its deposits in the Exchange, closed its doors. This bank is owned by Mr. John B. Whitehead, president of the Exchange National. CAUSE OF THE TROUBLE. Mr. George M. Bain, of Bain & Brother, Portsmouth, is cashier of the Exchange Bank, and Mr. J. G. Bain, of the same concern, is vice-president. For some time past their affairs have not been regarded as in good condition. is is said that they had real estate asGuaned at $250,000. which would not now realize that amount, and the impression in that the troubles of the Exchange Bank grew out of Bain & Brother's embarrassments. Comptroller Orson Adams came to the city several days ago, and people who knew of his presence here were quite curious to know what his business was, but nobody foundout until to-day, when the Exchange Bank was closed by his instructions. Indeed, I have it on authority that the officers of the bank were moving everything up to the last minute to continue busimean, and it must be said to their credit that as soon as they found that the suspension of the bank was a mere matter of time they closed doors at once without any sort of delay. The bank is one of the oldest in the city and had a capital stock of $300,000. It is a national bank and is the depository for United States funds. The internal-revenue funds collected in this district are deposited in this bank, as are also custom-house collections, postoffice moneys, &c. It is not known how much money of this character the bank had on deposit, but the postoffice and custom-house here had only about $1,100 in the vaults. Of course, all this is secured by Government bonds. It can hardly be that the depositors will lose much. if anything, of their deposits, as the officers of the bank are all sound and honorable men, and Mr. Whitehead alone is said to be worth $300 $300,000. OTHER BANKS. It was intimated yesterday to the other banks that trouble was brewing, and they were in a measure prepared for the shock. All have kept open and their business going and paid out money on demand. It was understood between them, however, that in case a run should be made they would avail themselves of the sixty-days' privilege. Up to this hour (2 P. M.) no runs have been made. All things considered, the condition of things is better than might be expected, as the Exchange National was regarded as the grand bulwark of our banking institutions, and has hitherto tided successfully over every panic. Captain J. E. Barry, president of the Bank of Commerce, says the trouble was caused by the action of the Comptroller of the Currency of the United States, who ordered the doors closed " because of large amounts of discounts allowed by the bank in violation of the law governing the same. He feels sure, however, that the depositors are safe and will not lose a cent. Further Particulars of the Cause of the Trouble- What Cashier Bain Nays. [Special telegram to the Dispatch.] NORFOLK, April 2, 1885. It is understood that the immediate cause of the suspension of the Exchange National Bank was its connection with Bain & Brother. Some years age Bain & Brother had on deposit $250,000 with the Exchange Bank, but thought best to invest in real estate and securities. They began to draw out their funds, and finally became indebted to the bank to the amount of $800,000. Then Orson Adams, the bank-examiner, came and looked into the accounts, and saw that the bank was discounting over or above one tenth of the capital stock, contrary to the law governing the national banks. He found that Bain & Brother had made bad investments and could not meet the deficiencies. They put up securities to the amount of $570,000, but could not raise the balance. Consultation was held. and Mr. Adams reported that with $300,000 the bank could go on, and in three years would be on a gold basis and could pay dividend. & Dr. R. H. McDonald, a large stock holder, was consulted and agreed to furnish the securities, promising to let the bank hear from him on Tuesday but did not respond, and then the Nor falk Clearing- House and F. B. MeDonald agreed to put up $200,000 and $100,000 respectively to raise the ne cessary amount. But in the mean time the matter was found out by some of Bain & Brother's creditors, and a run on the bank was threatened last night. This morning Bain & Brother closed doors and then the Exchange Bank sus pended. It is impossible to learn liabilities but Mr. Hain, the cashier, authorizes the statement that with judicious management the bank can pay all depositors dellar for dollar. He recognizes his Legal responsibility in discounting beyend one tenth of the capital stock, and will not shirk it. He says everything in the bank has been conducted open and above board. as the books will show. A receiver will be here to-mor row to take charge.
