Merchants National Bank (Brownsville, TX)

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Opening Greeted by Freezing Winds

GRAND JURY TO PROBE KIDNAPING CASE

IN VALLEY

RECOVERED FROM the first shock of the closing of the Merchants National Bank, Brownsville today stands waiting the publication of the reorganization plan worked out by the depositors' committee which has been on the job since March 21. The committee may rest assured one thing. No matter what the rumors which have been circulated, matter what the street corner gossip may citizens of all walks life stand ready and anxious work with the committee plan which promises specdy organization the bank. The panic has passed. Brownsville now realizes that the closing of the bank docs mean the Brownsville or of Brownsbusiness. The city realizes that far worse things than the closing the bank might befall us. provided the bank and reorganized. not the closing of the bank, but the failure effect speedy that will paralyze local business, and local business stand ready and anxious to all in their power to push this All that is needed now is the anof workable plan and effective leadership.

FEDERAL CROP LOANS are the That item has really ceased to be news. The real news feature of the crop loan business the Would appear to be the slowness Valley To for this federal money Those charge of placing the loans are More than eager to SCO the Valfarmer apply. They have loosened the restricHave cut the Gordian knot of red tape. You apply for the money, And within the available for Cameron for instance, Only $20,000 has been loaned to now expected that arrangements will Whereby may be secured for the planting crops, To be harvested during the winmonths. now available for Loans gation charges. They may also be bad for plantspraying. for fertilizer. The the only security demanded the government.

DEAD MAN'S CURVE will following action takno more. by the State Highway Commission alloting funds the widening of the main highway that point. has long been mystery to those who have followed the work the State Highway Commission just why this curve was allowed in the road In flrst place. The very unexpectedness of the curve has made dancerous than would appear nt flrst and the Valley breathe sight relief the announcethat be eliminated.

GROWERS last night the response given the join the Rio Grande Valley Exchange. No for the evils of the citrus exchange does offer the first of hope. ray the growers of the have seen. For Control of crop is the thing. And the organization offers that Provided of course. the of per cent the acreage. reached. Every known system of marketing fruit. Has been tried In the Valley. With the exception the offered the exchange. might be Just as well to try that.

AS OF Arelculture Geo. tried and friend the Valley. Carrying the masle name of Texpolitics. backed ability energy. Mr. Terrell has had little difficulty being elected to office which he has aspired in the state. Now he in the grand for and doubt will poll large vote. Hard as may be to believe. in more than three months Texas will to the polls the Democratic select state officers, to say nothing some political not already bolland almost over in politics would seem the the day from now in the Valley.

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IN OUR VALLEY

RECOVERED FROM the first shock of the closing of the Merchants National Bank, Brownsville today stands waiting the publication of the reorganization plan as worked out by the depositors' cominitteo which has been on the job since March The committee may rest assured of one thing. No matter what the rumors which have been matter what street corner gossip may Brownsville citizens of life stand ready and anxious to work with the any plan which promises speedy organization the bank. panic has passed. Brownsville now realizes that the closing of the bank does mean Brownsville or of Brownsvillo The city realizes that far worse things than the closing the bank might bofall us, provided the bank and reorganized. not the closing of the bank, but the failure to effect speedy reorganization that will paralyze and local business men stand ready and in their power to push this All that needed now Is the plan and effective leadership.

FEDERAL CROP LOANS available the Valley That Item has really coased to he The real nows feature of the crop loan business the ValleyWould be the slowness appear Valley farmers. To apply for this federal money. Those charge of placing the loans are More that onger to SCC the Valfarmer apply. have loosened the restricThey Have cut the Gordian knot of red tape. You apply for the money. And within available for Cameron for Instance, Only $20,000 has been loaned to date. is now expected that arrangements will Whereby may be secured for the planting of crops, To harvested during the wintor months. Loans nre now available for irricharges. They may also be had for plantspraying. for The the only security demanded by the government.

DEAD MAN'S CURVE will no more, following action takyesterday by the State Highway Commission alloting funds for the widening of the main highway that point. has long been those who the work the Highway mission just why this in the rond the The very of the curvo has more than at glance. and will of relief announcethat be eliminated.

GROWERS last were At the response given the To join the Rio Grande Valley Citrus No euro-all for the cvils of the citrus The exchange does offer the first real ray That the growers of the Valley have seen. For many years Control of the crop the And the new organization offers that Provided course, the toal of per cent of the acreage. reached. Every known system of marketing fruit. Has been tried In the Valley, With the of the offered by the might be just well to try that.

AS COMMISSIONER OF Areiculture Texas. Geo. Terrell tried and friend of the Valley. Carrying the masic name of Texpolitics. backed ability energy. Mr. Terrell has had little difficulty being elected any office to which he has aspired In the state. Now he in the groud for and doubt will noll large vote. Hard may be to believe, just more than Texas will to the nolls in the Democratic select state and county officers. to say nothing some The not already and and has almost boiled in IIIpolities would seem the order the day from now in the Valley.

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FEDERAL GRAND JURY TO GET FINDINGS MONDAY

Issue Subpoenas for Persons Informed About Affairs

Special to Valley Morning Star BROWNSVILLE, May 4—United States department of justice agents are investigating the affairs of the closed Merchants National bank and will present findings of their study to the federal grand jury which is to convene here next Monday.

Federal authorities here today confirmed the report that such action was being taken after subpoenas had been served on several persons purported to have knowledge of affairs of the bank during the several months prior to its closing.

Asst. Dist. Atty. Carlos Watson issued a statement today as follows:

"In the usual course of procedure and pursuant to a report from the office of the comptroller of the United States, the department of justice is engaged in investigating the affairs of the closed Merchants National bank.

"If, in our opinion, the evidence justifies it, the results of this investigation will be presented to the federal grand jury as a matter of ordinary procedure."

Judge R. J. McMillan of San Antonio is scheduled to take the bench until arrival of Judge T. M. Kennerly from Houston.

The Merchants National bank suspended operations about a month ago. It was the oldest and largest bank in the Rio Grande Valley and shortly before suspension had absorbed the First National bank.

Deposits of Cameron county, the city of Brownsville, numerous irrigation and improvement districts, were in the bank in addition to several thousand individual accounts.

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ASSESSMENT UPON SHAREHOLDERS

Treasury Department, Office of the Comptroller of the Currency. No. 7002

In the Matter of The Merchants National Bank of Brownsville, Texas. Washington, D. C., May 16, 1932. To All Whom it May Concern:

Whereas, upon a proper accounting by the Receiver heretofore appointed to collect the assets of The Merchants National Bank of Brownsville, Texas, and upon a valuation of the uncollected assets remaining in his hands, it appears to my satisfaction that in order to pay the debts of such association it is necessary to enforce the individual liability of the stockholders therefor to the extent hereinafter mentioned, as prescribed by Sections 5151 and 5234 of the Revised Statutes of the United States, Section 1c 156, Act of June 30, 1876, and Section 23, Act approved December 23, 1913, known as Federal Reserve Act.

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Notice is hereby given to all persons who may have claims against "The Merchants National Bank of Brownsville," Texas, that the same must be presented to John M. Young, Receiver, with the legal proof thereof within three months from this date or they may be disallowed.

J. W. POLE, Comptroller of the Currency. 5-27 to 8-28 incl. 3 mon.-4394

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ASSESSMENT UPON SHAREHOLDERS

Treasury Department, Office of the Comptroller of the Currency. No. 7002

In the Matter of The Merchants National Bank of Brownsville, Texas. Washington, D. C., May 16, 1932. To All Whom It May Concern:

Whereas, upon a proper accounting by the Receiver heretofore appointed to collect the assets of The Merchants National Bank of Brownsville, Texas, and upon a valuation of the uncollected assets remaining in his hands; it appears to my satisfaction that in order to pay the debts of such association it is necessary to enforce the individual liability of the stockholders therefor to the extent hereinafter mentioned, as prescribed by Sections 5151 and 5234 of the Revised Statutes of the United States, Section 1c 156, Act of June 30, 1876, and Section 23, Act approved December 23, 1913, known as Federal Reserve Act.

Now, therefore, by virtue of the authority vested in me by law, I do hereby make an assessment and requisition upon the shareholders of the said "The Merchants National Bank of Brownsville" for Two Hundred Fifty Thousand ($250,000.00) Dollars, to be paid by them on or before the twenty-third day of June, 1932, and I hereby make demand upon each and every one of them for the par value of each and every share of the capital stock of said association held or owned by them, respectively, at the time of its failure; and I hereby direct John M. Young, the Receiver heretofore appointed, to take all necessary proceedings, by suit or otherwise, to enforce to that extent the said individual liability of the said shareholders.

In witness whereof, I have hereto

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Arroyo Water Unit Sues Bank Receiver

An effort to recover a $273,740.40 deposit from closed Merchants National bank of Brownsville was begun yesterday by the Arroyo Colorado Navigation district when a suit was filed against John M. Young as receiver for the bank on the bank's $550,000 bond as depository for the district.

The petition alleges a demand was made for the funds March 12 but that this was refused. The bank closed March 24. The petition names John Gregg, A. F. Parker, W. E. McDavitt, Cleve H. Tandy and A. Cueto, Jr., as sureties on the bond and makes them co-defendants in the action. The bond covered a depository contract dated March 3, 1931 and scheduled to cover two years, the petition maintains.

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RECEIVED WITH MINGLED feelings will the announcement John Young. receiver of the closed Merchants National Bank, that reorganization plans been disapproved by the comptroller and that plans being made to pay dividend within the weeks. what appeared the Up against be an almost hopeless outset members of the the committee have labored depositors hard to bring about reorganizawhich would benefit alike both tion and debtors of the closed creditors institution. there no doubt, who Some will feel that with the announcetheir non-success there ment of dire days for Brownsville. come Others there are who feel that have the status of well to decided and that fairs definitely of 20 per cent the payment the will bring dividend to benefit to the entire comdirect fairly large munity by putting actual cash into amount of culation. there is room for Certainly to congratulate announced course which on the receiver proposes to Mr. as take. The fact that those who owe the bank will not money pressed for, an immediate payment due should the total amount debtor of the bring to every bank. whole may The community that busibreathe sigh are not going to institutions what they cannot be forced to pay in that property pay one lump to be foreclosed upon not going the market to the and thrown on demoralization of values. of this dividend. this Payment means that column sces simply the comptroller's department convinced that there has not yet workable plan of been evolved does not mean the road closed to that in the future If organization can devised. workable plan of the community Appreciation committee for due the depositors' have spent in its the they also due behalf. and appreciation receiver for the Young friendly plan of sensible and he has stated he liquidation which follow as the representative banking department. the national

TO READ AND WE LIKE to read newsespecially do have we had quite But we degenuine pleasure week's issue of reading the Mercedes the heading RememUnder score or more of Mercedes incidents of the early Related of that Incidents most interesting. amusand instructive. want to get real kick out If you the Valley as used to in to beg. borrow We advise you last of the copy the

GREEN FRUIT SHIPCRY OF reaches us this season before ments have even been the shipments made. call from Miles Telephone the other day says he has "on authority" that few "selfish good interests" of the Valley plainto artificially colored ship fruit which too geen to live up to the Valley's reputation. Says these shipments are going to be made the eastern markets and that they will ruin our market and retard the demand for from to 60 days. We cannot believe it, somehow. We have no doubt but that Mr. Miles sincere his belief, but cannot believe that anybody going to take chances with the reputation of Valley fruit this

One thing do the state would pass green fruit law that would prevent the shipment fruit which not up to standard. If fruit which unfit to the standard by the (Continued

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TO CLOSED BANK

Receiver First Ready In Payment Few Weeks dividend will paid to positors and other creditors the closed Merchants National within the next four five weeks, according made Saturday afternoon by Young, receiver. Decision to proceed plans payment of Mr. Young stated. follows receipt letter from the comptroller stating that plans for the bank by the could proved.

Suggests Action

The letter from the comptroller. according the receiver. also tained the that the mittee not further delay the paydividend. Exact amount the dividend paid divulged from amount funds hand shown statement. anticipated that depositors will than per cent their deposits first dividend payment made. office of the comptroller any effort to organize closed bank and ready times to assist when there basis which will insure safe sound which will function safety for the Institution and serve the Young stated. because local conditions. has been possible effect such ization in the that the depositors has been Copies of the letter from the comptroller which the reorganization plans disapproved were delivered the depositors committee meeting held Saturday. Sept. Mr. Young stated. and since that time he has receivstates. letter from one member of the committee who large depositor in the stating that opinion the reorganization could not be effectAssurances that the liquidation the bank conducted future. the past, local conditions and the that enforce immediate many the notes due the bank would be not the but he bank itself, were the statement Young in announcing the proposed dividend.

Statement Issued

Statement issued by the receiver follows: "Acting under directions from the comptroller's nothing been done which might in hamper interfere efforts toward until every opportunity had been given depositors committee perfect possible. that compwould not approve the plans agreed the other parties the ahead looking toward payment dividend at as carly date possible the request of the depositors' was made the bank's assets and representative committee permitted to designate what notes would willing take into the new bank. This classification later gone with the committee San Antonio the amount acceptable notes reduced. made that feasible undertake the reorcanization bank ported the comptroller's office which in turn made the suggestion that inasmuch as reorganizaseem feasible that the depositors' committee cease operations the end that divimight paid. time there been any suggestion made plan offered whereby capital brought into the and fact that bank firm without being the plans by the committee and fact liquidating propositions. based upon and much more expensive scale liquidation through the comptroller's office.

Claims Filed

"About 95 of the claims have been filed and has decided upon takes least the Plans now going ward and to the should paid within the next four five the the depositors' have the they have sured the should time come when they that (Continued on Two)

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DEFUNCT BANK ANNOUNCES DIVIDEND

Special to Valley Morning Star BROWNSVILLE, Nov. 2.—The long-awaited declaration of a dividend for the depositors of the closed Merchants National Bank of this city was announced this morning by John M. Young, receiver of the closed institution, to be paid within the next three weeks.

The dividend will amount to 22 per cent of the $2,300,000 deposits of the bank at the time of closing or approximately $506,000, and will be paid as soon as the dividend checks can be made out, signed by the proper officials in Washington, and returned here for distribution, according to Young's statement.

In the statement, which was issued to the depositors of the bank this morning, Young explained the delay in making the dividend as being due to the necessity of first paying off a $500,000 debt to the Reconstruction Finance corporation and receiving back securities for the loan amounting to nearly $1,000,000.

That loan was made to the bank before it closed, and a dividend being declared before its payment would have of necessity included the R. F. C. as one of the bank's creditors, according to the statement.

A new loan of $500,000 has been secured from the R. F. C. for the payment of the dividend, under which the R. F. C. will share.

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YOUNG RESIGNS BANK POSITION

Receiver Takes New Post At With Comptroller

Resignation of John M. Young, receiver for Merchants Nationbank Brownsville since 1932. accepted office comptroller currency. Mr. Young leave Tuesday for announced late Saturday. In Young will associated with the office the comptroller the connected with supervision national banks not licensed open the since their closing holiday March. has been working that for the past He left for April Fountain of ence, arrived in Brownsville Saturday succeed Young be actively in charge closed bank Monday morning. The receiver to the Valley by Mrs. Fountain has in lingen. Fountain highly pleased his transto Brownsville and stated that would to carry out, as aspossible, policies urated by Young during months receiver the bank. Mr. Young, who was appointed receiver the Merchants March 29, 1932, shortly the bank closed, has served for the and has made friends the district systematic treatment the problems which have arisen during tenure of office. His appointment to the office comptroller the ture of distince promotion. receiving congratulations of his friends Saturday.

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BANK RECEIVER DIES AT SUNDAY SCHOOL

BROWNSVILLE, Nov. 26.-J. Fountain, 63, receiver of the Merchants' National Bank here, died while attending Sunday school at the First Baptist Church Sunday. Fountain came here from Marlin, where he had been in the banking business for many years. Surviving him were his widow, four daughters and two sons, all of whom live in or around Marlin. Funeral services will be this afternoon at Marlin.