Citizens State Bank (Crothersville, IN)

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MANY NOTES HELD ARE NOT BANKABLE (Continued from first page)

posits totaled $245,737.97. The resources of the bank, as shown by its own statement on September 12, appraised the real estate and banking house at $6,500; furniture and fixtures, $3,977; other real estate, $14,691.25; due from banks and trust companies, $8,620.93; cash on hand, $2,501.23; cash items, $28.26. The statement also showed that the banks had bills payable, or money borrowed from other banks and trust companies aggregating $25,000.

Mr. McMillan explained to the stockholders that in the examination the various notes held by the Crothersville State Bank had been classified according to their value as the examiners had been able to determine them. He stated notes to the value of $65,953.81 were regarded by the examiners as not bankable paper, while $45,342.89 had been classified as "doubtful." This made a total of $111,296.70 of paper classified as "not bankable" and "doubtful." This left notes to the value of $159,156.46 classified as "fairly good" and "collectible."

Mr. McMillan told the stockholders that in order to arrive at the actual value of the resources of the Crothersville State Bank that the banking house had been appraised at $5,000, and the furniture and fixtures at $1,500, a reduction of $2,977 from the estimates contained in the bank's statement on September 12. In addition to these items the bank held U. S. Bonds of $150, town of Crothersville bonds of $500, that $8,620.93 was due from banks and trust companies, that cash on hand totaled $2,501.23, and that the cash items were $28.26. This brought the total resources, including the acceptable notes for $159,156.46, up to a total $177,456.80.

He pointed out that the deposits amounted to $245,737.97 and the bank had bills payable of $25,000, a total of $270,737.97, while only $177,456.88 was listed to pay it. He explained that any of the notes which had been classified as "not bankable" and "doubtful" that could be collected would reduce the loss just that much, and it was rather uncertain as to the exact amount that might be received from the notes. He also explained that while some of the so-called unbankable notes might be paid, the amount would probably just about offset those classified in the good notes which might not be paid.

Mr. McMillan stated that the examiners figured that an assessment of 100 per cent. against the capital stock of $30,000 would realize $24,800, as some of the stock is now in the hands of owners who are not financially responsible to pay the assessment. On the basis of the figures of the examiners, including 100 per cent. assessment against the stockholders of the Crothersville State Bank, a total of $202,256.88 will be raised, leaving a deficit of $68,481.09 that must be suffered by the depositors.

In his preliminary statement to the stockholders Mr. Barr explained that the Citizens' State Bank had only a small list of "bad and doubtful loans" but that it was deemed advisable to close that bank at the same time that the Crothersville State Bank suspended business to prevent the depositors from making a run upon it. He intimated that if conditions had been favorable the Citizens' Bank might have weathered the storm, but it was hardly probable that it would have been able to remain open very long after the other bank was closed. "It was the only fair thing to do, it was the only just thing to do under the circumstances. That was the sober judgment of the directors and myself," said Mr. Barr.

After the condition of the two banks had been presented to the stockholders, Mr. Barr told them that they were privileged to ask any questions they might desire to help clear up the confused situation. He stated that time will be the factor in determining what percentage of the deposits can be paid and that such payment will depend upon the ability of those in charge to collect notes now due. He explained that the resources of the bank would first be exhausted and

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TWO BANKS INSOLVENT IN SAME INDIANA TOWN Institutions in Crothersville Face Losses of $100,000-Receiver to Be Asked. By the Associated Press. SEYMOUR, Ind., September 22.The Crothersville State Bank and the Citizens' State Bank, two institutions at Crothersville, a town twelve miles south of here, are insolvent, and appointment of a receiver will be asked, Thomas Barr, deputy commissioner of the Indiana state banking department, announced today. The two banks face losses of approximately $100,000, Mr. Barr said.

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BANKS INSOLVENT Receiver Will Be Asked For Two Indiana Institutions SEYMOUR, Ind., Sept. 22.-The Crothersville State bank and the Citizens State bank, two institutions at Crothersville, a town, 12 miles south of here, are insolvent and appointment of a receiver will be asked, Thomas Barr, deputy commissioner of the Indiana State Banking department, announced today. The two banks face losses of approximately $100,000, Mr. Barr said.

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Crothersville Bank Bankrupt By Times Special SEYMOUR, Ind., Sept. 24.-Assets of the Crothersville State Bank and the Citzens State Bank of Crothersville were to be transferred to Union State Bank of the same town today. Both institutions were closed on account of losses estimated at $100,000. The Union State Bank was appointed receiver by Judge Cox of the Jackson Circuit Court Saturday. The bank is a newly organized institution.

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ATTENTION FOCUSED ON OPENING OF NEW BANK

Receiver for Two Institutions Closed September 12.

PUBLIC MONEY INVOLVED

[Special to The Indianapolis News] SEYMOUR, Ind., September 26.—Following announcement that losses approximating $100,000 had resulted through the failure of the Crothersville State Bank and the Citizens' State Bank, the only banking concerns in Crothersville, twelve miles south of here, attention today was focused on the opening Tuesday of the Union State Bank, a new organization. The new institution, of which Mark Storen, of Scottsburg, former United States marshal, is president, has been named receiver for the two defunct banks.

The Union State Bank was designated by Judge James A. Cox in the Jackson circuit court at Brownstown late Saturday to handle the affairs in connection with the receivership proceedings. The applications for receivers were filed by Thomas Barr, deputy commissioner of the Indiana banking department, in the name of Eben H. Wolcott, state bank commissioner. Many depositors and stockholders of the two banks recommended that the Union State Bank be designated receiver.

Assets Transferred.

Manufacturers and business men of Crothersville and farmers of the surrounding community who have been handicapped in the transaction of routine business affairs since the two banks suspended business September 12, are anxious to have banking facilities re-established.

Assets of the two old banks were formally transferred to the Union State Bank officers today by J. Paul McMillan, a state bank examiner, who assisted Mr. Barr in the examination of the Crothersville State Bank. The new bank, it is said, has bought some of the bankable notes from the former institutions. Notes classified as "not bankable" and "doubtful of collection" were turned over the receiver. Some of the notes are not due and no legal action can be taken on them until after the maturity date.

A point of interest in the situation at Crothersville was whether suits would be filed by depositors for the recovery of money placed on deposit a few days before the banks suspended business. It is known that attorneys in Seymour and elsewhere in Jackson county have been consulted by some depositors. One patron of the Crothersville State Bank is known to have deposited $3,500 September 11, the day before the bank suspended business.

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COMMUNITY INTERESTS FIRST

Much interest is manifested in Crothersville and the vicinity in the organization of the Union State Bank, which was formed after the Crothersville State and the Citizens' State Bank suspended business. The new bank, it is announced, will be conducted along the broad lines of service to the public with the view of making it of the greatest value possible to the people. Mr. Mark Storen, who was elected president, is qualified and competent to direct the affairs of the new banking concern. He has wide acquaintance throughout the community which the new bank will serve and is known as a man of highest integrity, sound judgment and business acumen. In Mr. Storen and the directors of the new bank the people of the town and community place their confidence and trust.

It is always a serious thing when a bank in any community fails. The condition of Crothersville was made worse by the fact that both banks were closed at the same time and the town was without banking facilities. Since September 12, when the two banks were closed, business men, manufacturers, and farmers have experienced many inconveniences and hardships and have gained first hand information as to what it means for that community to be without a bank. The people know that a banking concern is necessary for the proper development and conduct of business affairs in that community and are expected for this reason to give the new bank wholehearted support and cooperation. It is generally conceded that one bank could better serve that community than could two banking houses.

The failure of the two former banks brought direct losses to hundreds of people. In many instances portions of savings accounts which have been increased by strict thrift will be lost. Quite a number of depositors who were holding funds for specific purposes must also share in the losses. The heavy assessment which will be made upon the stockholders will prove a real hardship in many cases.

The situation is regrettable, but it appears that the solution will best be reached through harmonious action and cooperation, keeping in mind at all times that community interests deserve first consideration. It is for the permanent benefit of the community that the people have looked in the past and to which they must look in the formation of plans for the future. Crothersville is making remarkable strides in industrial development. Its program of development is broad and comprehensive and it cannot permit any misfortune to interfere with its possibilities. Crothersville has always been able to meet any crisis that has occurred and is counted upon to successfully overcome the present obstacles which have appeared in its path leading towards further growth and development.

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Voting Is Secret.

"The special prosecuting attorney shall I allowed at all times to appear bore the grand jury for the purpose of bringing information relative to any matter cognizable by it or advice upon any legal matter when required; and he may interrogate witnesses before the grand jury, when the jury or he deems it necessary, but no prosecuting attorney, officer or person shall be present in the grand jury room during the expression of their opinion or in giving their votes upon any matter before them.

"At least five of the grand jurors must concur in the finding of an indictment and when so found it must be signed by the special prosecuting attorney and it must also be indorsed by the foreman of the grand jury, 'a true bill,' and he must subscribe his name as foreman.

"The official court reporter will take shorthand notes of all testimony given and transcribe the same for the use of the special prosecuting attorney and the grand jury."

Jury Meets at Kentland

While the local grand jury was opening its investigation plans were being made for the convening of the grand jury at Kentland, McCray's home town, next Tuesday. J. C. Murphy, prosecuting attorney for the circuit including Kentland, said he did not know whether McCray's affairs would be investigated.

Three more suits against the Governor have been filed in Kentland. They are:

Union State Bank of Crothersville, as receiver for the Citizens State Bank of Crothersville, against A. E. Herriman & Co., A. E. Herriman and Warren T. McCray, for $3,000.

Broadway State Bank, Ft. Wayne, against Fred Lyons, Jacob D. Rich, Hugh M. Light and Warren T. McCray, for $5,000.

Farmers Trust Company, Ft. Wayne, against Warren T. McCray. for three notes, $7,000, $3,000 and $2,750.

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three suits, $6,073.35. Ruth Clark, Kentland, $2,305. Union State Bank as receiver for the Citizens State Bank, Crothersville, $3,431.75. Delaware County National Bank, Muncie, $10,873.03. Cannelton National Bank, Cannelton, $5,788.87. People's Trust and Savings Bank, Laporte, $5,800.76. Marion National Bank, Marion, $3,497. Grandview Bank, $2,576.90.

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CLERK F. L. SCHORNICK APPOINTED RECEIVER

Of The Crothersville State Bank to Succeed Union State Bank, Temporary Receiver.

OFFICE AT CROTHERSVILLE

Will Continue as County Clerk, But Will Resign Same if His Duties Should Conflict.

Clerk F. L. Schornick was appointed, by Judge Jas. Cox last Friday, receiver of the Crothersville State Bank, which was closed by the State Banking department some weeks ago.

Mr. Schornick was appointed to succeed the new Union State Bank at Crothersville, which was appointed temporary receiver at the time the doors of the Crothersville State Bank were closed. The petition for a new receiver was filed at the beginning of the October term of court, the petitioners basing their objections to the temporary receiver on the grounds that some of the directors of the Union State Bank had also been directors of the defunct bank and therefore are not disinterested parties and under the circumstances could not be expected to act to the best interests of other creditors.

The appointment of Mr. Schornick came as quite a surprise as his name had not been mentioned among the several whom it was thought were being considered for the place. For the convenience of most of those interested in the bank, Judge Cox would have preferred to have appointed some one from Crothersville or vicinity but it seems that everyone suggested was interested, either directly or indirectly, in the bank. However, those interested in the settlement of the bank's affairs will not be greatly inconvenienced as Mr. Schornick will maintain an office in Crothersville and spend the greater part of his time there. He will probably use one of the bank buildings for his place of business. There has been some talk that the Union State Bank had considered buying the building and fixtures of the Crothersville State Bank, which they have been renting since that bank was closed and the new bank was organized. In case such a deal is closed Mr. Schornick will likely open his office in the building of the Citizen's State Bank which was also closed at the same time as the Crothersville State Bank.

Mr. Schornick will continue to serve his term as county clerk, which does not expire until February, unless he finds that his duties as bank receiver conflicts with or takes too much time from his official duties in which case he will resign as clerk. In this case it is quite probable that Clerk-elect Virgil Fountain will be appointed by the county commissioners to fill Mr. Schornick's unexpired term.

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STATE BOARD OF FINANCE DELAYS (Continued from page one)

the funds in question.

The case of the Kentland Deposit and Discount bank, which is defendant in a similar suit, but for a much larger amount, was also presented at the meeting. That bank subsequent to filing of suit at Kentland, has made a substantial payment to the state on its demand for $90,000 state funds deposited in the former McCray bank when it was closed.

Suit brought in Jackson circuit court by the State Board of Finance against the Citizens State bank, of Crothersville, to recover $1,000 has been dismissed because arrangements have been made by the Union State bank, receiver, to pay the amount.

It is believed the Board can be satisfied in the case of the Crothersville State bank without pressing its suit.

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BRANAMAN NOT RECEIVER

Appeared As Attorney For Union State Bank, Receiver.

The report on court proceedings in Jackson circuit court in the Tribune this week stated that Thomas H. Branaman, of Brownstown, had been appointed receiver for the Citizens State Bank, of Crothersville. The item should have said that Branaman appeared as attorney in a petition to sell property of the Citizens State bank. The Union State Bank is the receiver for the Citizens State Bank.

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NO CHANGE MADE IN BANK RECEIVERSHIP

Erroneous Report That Thos. Branaman Had Been Appointed Receiver Citizens State Bank at C'ville.

An erroneous report was in circulation last week to the effect that Thos H. Branaman had been appointed receiver of the Citizens State Bank at Crothersville, of which the Union State Bank has been receiver ever since the Citizens State Bank failed. The report was spread through the publication of an article in the Seymour Tribune to the effect that Mr. Branaman had been pointed receiver, when in fact Mr. Branaman had recently been appointed attorney for the Union State Bank, receiver, and had filed a petition in circuit court to sell the real estate and personal property of The Citizens State

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SENATOR BRANAMAN APPOINTED BANK RECEIVER.

Thomas H. Branaman has been appointed receiver for the Citizens State bank of Crothersville and directed to make sale of property of the defunct bank. Branaman, Brownstown attorney and state senator, was appointed by Judge James A. Cox, of the Jackson circuit court. The bank was closed nearly two years ago by the state banking commission and Eben H. Wolcott, bank commissioner, filed suit asking for appointment of a receiver to supplant the Union State Bank of Crothersville, as receiver. The property owned by the bank consisted of the building, equipment and lot.

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BANK RECEIVER

Sherman Hall Files Suit Against Union State Bank, Receiver Citizens State Bank, Crothersville.

SHERIFF ALSO IS DEFENDANT

Two Damage Suits Filed Resulting from Same Auto Court Cases.

Among the new cases filed in the Jackson circuit court the past week that of Sherman Hall and Leva Hall, husband and wife, vs. The Union State Bank of Crothersville, Receiver of the Citizens State Bank and Sherman Sheed, Sheriff of Jackson County, for damage and mandate. The plaintiffs allege in their plaint that during the year 1923, plaintiff. Sherman Hall, became debted to the Citizens State Bank of Crothersville as surety on certain notes, and that said Union State Bank, receiver obtained judgment against plaintiff for $1129.33 and attorney fee. That on same day said bank obtained judgment against Daniel McGill for with said plaintiff surety, and that said plaintiff Sherman Hall had previously signed surety notes aggregating more than $30,000, and did not have sufficient property pay said The complaint further sets out that to avoid waste of assets and to cure greatest amounts of payments available to many creditors, that said plaintiff entered into written agreement with said Union State Bank, receiver and various other (Continued To Page Eight.)