Capital National Bank (Lansing, MI)

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BANKER TELLS JUNIOR C. OF ECONOMY NEED

(Concluded Page adopted for sale. The Capital tional made no profit this transThrough the City National board of several the Capital National against any working with the Capital City board handling the of the old City pay tribute to those men put up their personal protect their good name. To those men equally much credit for depositors as is due the Capital co-operation, their sincerity, the steps they took difficult when, vitation the National bank, bank, years and Olds, Harry Harper, and Scott. He reviewed the steps taken by the federal government endeavor restore confidence bring country Washington last which attended by prominent bankers and President Hoover laid them plan designed down the hurricane which was sweeping over the "Sold" on Hoover

The bankers went to that conference gloomy spirit more less disgruntled Lord said. They out of the conference the Hoover plan helpful. step plan was the organization Credit corporation subscripthe to loan to banks need of help. Michigan banks the speaker said fund two large groups in troit the First About 100 made in the After Credit corporaforthcoming in the the nance Mr. said. made available two billion dollars the government banks, building loan companies, mortgage firms. same committee which handled the the National Credit poration the Finance said, the addition William Alden Smith of Rapids. This tional Credit corporation and the construction Finance stopped the steady run of bank

Tells Glass Bill Provisions The adoption bill vides federal banks broader powers in the making the he the the Hoover plan Glass designed to make paramount depositors, and to aid the the bill, he has four loans period Mr. believes will federal liquidating Money finance include the United States treasury. equal one fourth the surplus federal reserve about and sum member of the federal reserve within office, banks must the the federal closing the CapNational here and to loaned than taken out here deposited Detroit,' said.

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MICHIGAN BANKS ORDERED CLOSED

Proclamation Provides for Eight Day Holiday

Nearly 600 banks the lower peninsula state Michigan ordered Governor Comstock Tuesday morning of the ment the Union Guardian Trust Company of which with large of branch banks tions the state Unable their the bank meet steady demands made on Conferences called with state officials leading of including the heads of the General Motors. Chrysler Ford The former companies while the Ford company deposits excess of and claims have supported the bank with exceeding request made Ford company interests to those of smaller depositors and of Finance Corporation which already made loans the bank This port which they had already the bank Fearing bank panic after conference with leading and and state officials holiday decided upon until adjustments could made whereby all banks of the state would prepared withstand demands usually follow such financial upheaval Much citizens over the and particularly the large cities such Detroit denied made Wednesday ing. permitted withdraw per their relief and that perfected many the banks of again full before expiration of the eightday appreciable effect the Indiana cities by the the Michigan banks Banks of this county had with Michigan local bankers state that they amply able to render full their and depositors that he knew the general banking condition good. that the plan adoptwith approval struction Finance Corporation simply calculated to maintain steadiness an unstable financial situation.

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THE MICHIGAN MORATORIUM

The Governor of Michigan has closed all the banks and trust companies in his State for eight days. It is the same thing, on a larger scale, as has happened in many small towns in the Middle West and West during Shutdowns the course of this depression. It has happened all over Michigan for the same reason, Vs. Runs which appears to us to be a good reason. This reason simply is that the gold standard dollar has been growing more and more un-get-atable. It is better to freeze money in the banks and go on a scrip basis temporarily than to permit bank runs, which might produce bank failures. We think Gov. Comstock of Michigan has acted wisely and with true prudence. As we see it, the Michigan moratorium is another argument for cheapening the dollar so that people can get it more easily to buy goods, pay debts and keep business in motion. President Hoover told us Monday night in solemn tones that if we go off the gold standard we shall have economic disaster. What does he think we're having now, while we still cling to the gold standard?

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THE MICHIGAN MORATORIUM

The Governor of Michigan has closed all the banks and trust companies in his State for eight days. It is the same thing, on a larger scale, as has happened in many small towns in the Middle West and West during Shutdowns the course of this depression. It has happened all over Michigan for the same reason, Vs. Runs which appears to us to be a good reason. This reason simply is that the gold standard dollar has been growing more and more un-get-atable. It is better to freeze money in the banks and go on a scrip basis temporarily than to permit bank runs, which might produce bank failures. We think Gov. Comstock of Michigan has acted wisely and with true prudence. As we see it, the Michigan moratorium is another argument for cheapening the dollar so that people can get it more easily to buy goods, pay debts and keep business in motion. President Hoover told us Monday night in solemn tones that if we go off the gold standard we shall have economic disaster. What does he think we're having now?

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THE MICHIGAN MORATORIUM

The Governor of Michigan has closed all the banks and trust companies in his State for eight days. It is the same thing. on a larger scale, as has happened in many small towns in the Middle West and West during Shutdowns the course of this depression. It has happened all over Michigan for the same reason, Vs. Runs which appears to us to be a good reason. This reason simply is that the gold standard dollar has been growing more and more un-get-atable. It is better to freeze money in the banks and go on a scrip basis temporarily than to permit bank runs. which might produce bank failures. We think Gov. Comstock of Michigan has acted wisely and with true prudence. As we see it. the Michigan moratorium is another argument for cheapening the dollar so that people can get it more easily to buy goods, pay debts and keep business in motion. President Hoover told us Monday night in solemn tones that if we go off the gold standard we shall have economic disaster. What does he think we're having now

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Michigan Recovering from State Wide Bank Holiday Order

Nearly 600 banks in the lower peninsula of the state Michigan ordered closed by proclamation of Governor Comstock Tuesday morning because of the embarrassment of the Union Guardian Trust Company of Detroit which with large of branch banks was one of the largest banking institutions in the state. Unable to convert their the bank was able to meet the steady demands made on its reserve. Conferences were called with state officials and with some of the leading industrialists of Detroit. including the heads of the General Motors. Chrysler and Ford Corporations. The two former companies were depositors. while the Ford company had deposits in excess of and claims to have supported the bank with investments exceeding request was made that the Ford company subordinate their interests to those smaller depositors and of the Reconstruction Finance Corporation. which had already made heavy loans to the bank This the Ford company refused to do in view of the heavy investment support which they had already given the bank Fearing general bank panic after conference with leading financiers and government and state officials the proclamation for an holiday was decided upon until could be made whereby all banks of the state would be prepared to withstand demands usually follow such financial upheaval. Much inconvenience was occasioncitizens over the entire state, and particularly in the large cities such Detroit when banking privileges were denied them. Arrangements were made Wednesday morning. however. whereby depositors were permitted to withdraw five per cent of their deposits as emergency relief. and is predicted that will be perfected whereby many of the banks of the state again be in full operation before the expiration of the eightday holiday. Much cash was poured into Michigan from outside sources on Wednesday and Thursday and it appeared Thursday that would available for circulation in than in the during the boom times Many banks were expecting to resume operations by Friday in limited and reported that in view of the expected recovery from the situation that state banking department would leave at discreation of the banks the matter of reopening before the expiration of the holiday set.

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WEEK'S

SURPRISE SHOCKS WELL RESISTED BY PRICES IN GENERAL and

CHARLES F. SPEARE BY Consolidated Leased Journal. Feb. The episodes in our unexpected business life and with all of their implications, could not have failed to produce certain liquidation securities fact that they did not The create an even greater degree of of this that stocks meaning have The liquidated group of values. other the most reother developments the subtract from what be encouraging appeared had The present average being the lowest since Octhe confitober, dence that has taken place since that time rather than conditions. measuring a The world was unprepared statewide banking moratorium in Michithat greeted it Tuesday morning some months been assured was sound the and that that while might be weaknesses in that will have supported, the crisis in last banking was there was distinct shock in the spectacle an entire one state, the country largest having its banking entirely withdrawn order to prewhose assets the extent of over per cent were invested in real the heart of this situation is of investing large banking portions the those paper that are not marketable and, while profitable fair weather. are liability disturbed public sentiment. realized now in many that the value of their banks little and henceforth is with the of The Michigan incident recalls the credited the Fidirectors that no major trouble would be permitted banking This might be supported the while no institution Detroit deposits over 500 banks and aggregating have been for prescribed period. That there on the part Corporaassist instiand that toward deinflation apparent each Report Scanned This the report of committee to the opinions and where the ing in mat in the past ters some promoted the investitransportation keen for if they the would of in the frank has closely follow Salt Lake City and Louis railroad conagain the position of the the bondhave abused their and up deearly must be accepted There for continuto railroads that handicapped ratio embarrasses such propreasonable financial the for the railroad sitsituations must an the market totheir the Reconstruction Finance Corporation to additional railroad practically defaulted price

Firmer Some banking dismarket, with weakness has developed year suggestion fiinapparent exchanges Japan's credit rest quest for greater considerable loans by the the the foreign trade outlook in South republics the inColomCongress Still Lagging during been helpful legisthe fears the would been an institute what are termed and part in the shrinkage now the general not the time to They the betterment of the situinvolved listenrecital of the Insull vandal may have York Stock ago utterly immediate good and distraught people and farm sidetracked Pressuspend congress abruptly Comstock stopped the

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MICHIGAN'S BANKS OPENED TODAY FOR LIMITED BUSINESS gan's banks opened for restricted business today. some of them for the first time since Governor William A. Comstock's emergency closing order ten days ago. Rudolph E. Reichert state banking said that most banks were "doing business in the best possible way," and congratulated the state's bankers on their cooperation during the emergency. He said that most banks were cashing checks that had not already been cleared, on the depository percentage basis laid down in the governor's second proclamation issued Tuesday. Generally, the banks were following the plan under operation for the past week in Detroit, allowing depositors to withdraw 5 per cent of their deposits. In Detroit at the opening hour there were no lineups outside the banks and few instances of unusual numbers of customers inside.

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NEWS

Page. Movie Reel Editorial Movies Markets Winchell Ads Folly Island. Weather Radio Sports 16 Plans started for early pres. the west farm relief proposal. Page The United States general ruling on the proper of assembling to vote repeal. Page The senate banking heard charge the City control the mar ket for its stock. Page Senator assailed he clared control by New York Page The senate did some expense paring and then wiped added Page

Mrs. Theodore Roosevelt belated apology from health officer. Page Senator Thomas Walsh sailed for Cuba to marry sugar grower's Page President Roosevelt appointed Representative Douglas of Arizona as budget director. Page Michigan banks reopened. Page 2.

Dr. Charles urged cational guidance for employed adults. Page The repeal proposal was put Page The city council committee recommended the department personnel cut Page The park board had natural goldfish bowl Birch at Page Presidents of state teachers' col. united against the proposed curtailment of the state sys. tem. Page Northwest Feed Dealers told unregulated trucks affected their business. Knowledge of school subjects was called not the essential of education of girls by Dr. Malcome Mc. Lean. Page Miss Helen Wilson, former resident of Minneapolis, died Tre mezzio, Page 6. Patrick 79. deputy sheriff, fell dead. Page Two suspended Paul policemen were sentenced for larceny. Page

SINCE prohibition went effect several states which were dry have shown wet sentiment. map and story indicate the Page President-elect Roosevelt has decided he'll rely on service agents guard him the inanguration. He told Arlayne Brown, world champion revolver shot. offered that she won't be needed. Page The intelligence that gets marks not the only from educator. Dr. Malcolm college rector the University of urged education that will fit life. Page

The big Japanese drive in Jehol started. Page The Mount Everest plane party from Sicily after five Page WOMEN'S NEWS. Evon Nollette describes garments designed for double duty. Page 13. for Swedish meat balls by Kate Smith. Page 13. Restlessness is Elsie Page 13. Jessie DeBoth presents Sunday dinner menu. Page 13. SPORTS. Mickey shaded Frankie Knauer the six-round of the boxing Page 16. The city high school basketball will wind up today. Page 16 Page 17. Alexandria's quintet was elimi nated by the St. Paul Flyers in the feature of the amateur basketball the Ascen sions, Holy Cross and Belle Plaine also won. Page 17.

MARKETE

Bullish vanished in the Minneapolis pit; Chicago tumbled. Page 18. Stock values slumped to new low averages on large turnover. Page 19. Bonds suffered the worst relapse since the first the 19. Page 19. Dog and lamb trade advanced in South St. Paul: cattle prices mained unchanged. Page

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The Bank Situation in Brief

Since the issuance of the governor's proclamation of February 14, followed by that of the President on March the banking situation in Lansing and throughout nation has been in state of unrest. Individual and business depositor has borne the curtailments with that spirit of complete accord and co-operation which should redound to the eternal credit of the American citizenship whole. All, of every class and creed, have found themselves on the same level, and all have worked together in an effort to piece together the shattered financial structure, and build anew system far more stable than the nation has ever known. The events taking place in Lansing Friday are but this community's part in the great task that confronts. The situation is simple one in the statement of facts concerning it. It is tedious and difficult one in reaching its ultimate Stated in brief, is simply this: A conservator, at the request of the directors of the Capital National bank. has been named for that institution. It is his job to conserve all the assets of that banking house so that depositor receive the ultimate amount of percentage of his deposit. He is not receiver. He the sole dictator there, subject only to orders from the United States government and the law governing his duties. committee has been named by the directors of the former Capital National bank, and is already at work to bring about the formation of new National bank here. That bank will be chartered by the federal authorities. It will open with capitalization of half to be supplied locally and half by the Reconstruction Finance corporation. Both subscriptions have already been arranged for. The new bank, once its charter is will immediately enter into negotiations with the conservator of the Capital National bank in order to effect quickly possible the transfer of such liquid assets as are agreed upon. The completion of this transfer will immediately release percentage of the deposit of each individual depositor. This release will be in addition to the percent formerly set aside for depositors by the Capital National. The frozen assets of the Capital National will then be liquidated speedily as is possible by the conservator, additional dividends being paid to depositors as this is done. Just how soon the new bank will be ready for operation depends wholly on Washington. Just how any deposits be released pends on the completion of negotiations between the officials of the new bank and the conservator. These are expected to be speeded so that there will be little delay as possible in the resumption of normal banking conditions in the city. The outlook, it presents itself, is brighter for Lansing than has been in many day. The uncertainty of everything has been dispelled. Bankers, depositors, industrial leaders and the citizenship whole. now know the common ground of endeavor on which the city's financial structure is to be rebuilt. That rebuilding will require time. It will require patience. It will further forbearance and further sacrifice. But it will be complished with the greatest possible speed. And once is perfected the will find within its midst banking facilities of the most complete city sort, organized along lines laid down by government, and supported by the complete confidence all

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Committee of Business Leaders Works To Organize Institution Taking Over Old Liquid Assets; Lucas East Lansing Conservator

Definite steps for the formation of new national bank in Lansing to supplant the Capital National bank, taking over its liquid assets, were in progress Friday in Lansing. This action followed appointment of Nathan P. Hull, Lansing, as conservator for the Capital National bank, an action which had been requested by directors of the institution.

Other conservators announced Friday afternoon for central Michigan state banks include the following: Herman S. Lucas, East Lansing State bank; Frank J. Stevens, Chesaning State bank; R. Teeters, Shiawassee County Bank of Durand; Carl O. Derby, Maynard-Allen State bank of Portland; E. Mills, Loan and Deposit Bank of Grand Ledge: Riches, Exchange State Bank of Mt. Pleasant; E. H. Fox, St. Charles State bank.

Officers Connections Mr. Hull director the Detroit branch of the federal reserve system, and also member of the board directors of the Capital tional bank The conservator announced that officers, directors and employes the bank had severed their relations with the institution immediately upon appointment Miles Grant, former assistant was named first assistant Hull Friday morning. Several additional employes rehired, Hull pointing out that engaging his force he selecting some those best acquainted with the of the bank and had taken consideration that the bank will employ many of the old employes. He said that changes the personnel would be made work progresses. Working Comptroller The formation the new bank, planned by local expected to completed within the days rules regulations laid down the comptroller the currency Washington. Immediately upon receipt of its conferences the conservator former Capital bank the taking the tion, percentage first available the depositors temporary reorganization comof Olds, ident Olds Harper. the tor Wheel corporation: president the Michigan Supply company: president the Insurance company: Bates, secretarytreasurer the Motor Car Ballard the Silsby. Ballard, and the MichScrew company Mr. chairman of the board the Capital National bank. that since the holiday directors the bank have been endeavoring to bring about bank from the Union Group. and bank, necessary to organize institution. In order accomplish this the the Capital bank requested comptroller currency point conservator. whose selection was announced Friday morning.

To Inventory Assets

Mr. Hull declared Friday morning that serve the assets, follow the law and co-operate with the and industrial life of Lansing far sible under the He said that first step make an inventory assets Capital National With exception making change payments bank pended Friday morning. Mr. Hull the comptroller of currency permission trust accounts. sage granting this permission pected later the Other Aides Employed

Other the conservator's the bank announced shortly Friday follows: Marshall Westfall, Goodell John Nelligan. Mabel Towner. Karlyle GansGeraldine Balcom. Myra Clark, John Bella Mark VanFrank. George David Timmons, John Kenneth Brodberg. Edna Robert Conklin, Harold Edward Georgiana Dool. Darlyne Marofsky. Arda Frieda Harold Catlin, Kenneth Ernest Deacon, Otto Marquart George Wyatt. Mr. Hull announced that the disthe branch ployes those institutions not determined.

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ASKS NEW CHECKUP OF LANSING BANK

Associated Press) LANSING, May petition was filed with Nathan Hull, conserMonday new examination of the assets the Capital National bank here. Chairman Richard Scott, of depositors' committee filing the petition, the request made in view rising commodiprices within the last weeks. last check-up made March after which the conservator was appointed.

The name God omitted from the Book Esther in the Bible.

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63 NATIONAL BANKS REOPENED IN MONTH

Washington, March 7.—(AP)—Reopening of 63 national banks during February was announced today by J. F. T. O'Connor, comptroller of the currency.

O'Connor said that at the end of February the number of unlicensed national banks had been reduced to 280 from 1,446 last March 16.

The national banks with the amounts of their frozen and unrestricted deposits, include the following in Michigan:

Ludington, First National Bank and Trust company, $838,000 and $123,000.

Lansing, Capital National bank, $11,801,000 and $399,000.

Marshall, First National bank, $768,000 and $160,000.

Utica, First National bank, $640,000 and $13,000.

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BANK

Gleason Supplants Hull in Charge of Affairs of Old Institution

Joseph W. Gleason, alderman from the second ward and president of the Silver Lead Paint named the Capital National bank Tuesday according word ceived from Nathan Hull, who served conservator the closed bank since March Mr. Gleason took over his new the Wednesday the ferred Mr. The newly had statehis plans the he first acquainted the For least, memstaff will main their present jobs. Order from Comptroller

The from Tuesday night by Hull declared part term conthe Capital National Michigan, terminates Joseph W. Gleason appointed receiver signed O'Connor, comptroller of the currency. Mr. prominent the the party in this the

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RECEIVER

Judge Admits Power Lacking To Force Production of Records in Suit

The defense won an important skirmish Monday morning the filed against the Capital National bank Harry former National securities depos. the former took over assets of the City Na. tional Judge Kelley of St Johns who presiding the trial Ing. county court held that the has no power pel Joseph receiver the Capital National produce sought by the plaintiff motion Edmund Shields, attorney for receiver the quashing directing produce court the ground rules the United treasury prohibit the receiver from divulging his records upon the fedcomptroller the currency Calls S. Rule "Astounding"

Alva counsel the opposed the the indicated the Cummins asserted that tounding to think that any government that not compel of testimony which does not involve state secret find it difficult to explain my indignation the attitude of the ernment, the government has liberately taken attitude which might this lawsuit the plaintiff the resproperty which claims rightfully his, Cummins "There order the the receiver records has not here that the department has adopted ceiver's producing in court Would Block Any Suit

"Such procedure and that feel that should that The state Michigan have because order comptroller of the currency Cummins that such position would prevent the bank had lost suing his deposit and would leave the fate of the depositor in the hands the comptroller of the Judge Searl ruled. that had power compel (Continued Page Column

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BANK RECEIVER WINS SUIT TO KEEP ASSETS

(Concluded Page for the best inand for the benefit in Lansing The bank and others the of 26 of and in and them charged other than the highest motives their endeavor prevent run the banks in Lansing when were that immediate action prevent the must be disposed of

Judge Takes Middle Ground

The chief point involved the apparently that hinging whether not "complete novasubstituting one for had been the Moore and City not been off the Capital failed its part the ment which, to protect Capital Moore and others sought return of their Counsel for the Capital National bank bank merely agreed perform the ligations of depositors Judge Searl did not entirely agree in this He four elements being: assent of tion old contract, validity of principal inquiry in this the question the positors, whether not they accept the Capital bank Judge Searl's He Capital by $500 the National display advised all other arrangement, notice could call the Capital National bank and get his money Depositors Agreed to Terms

Judge Searl out that during Capital National bank percent of the City National bank their the complete novation, impliedly accepted substitution of debtor for and have claim the the bank, the the the cannot now be and prove against National Searl the case the percent the inactivity of could not legal proof of Moore other could not discharge the Capital was but forced by the United see reason why the be the Capital National bank now involuntary liquidation, the opinion read on this point. The guarantors turned over 000 in securities to the Capital National bank, and time deposits of protect that bank. Besides Moore, plaintiffs were: the late Davis, then president of the City National bank: Richard Reo Motor Car company; M. Katherine Knapp, widow the late Joseph W. James W. Ransom Motor Car company, and the Motor Wheel corporation.

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Former Directors of Capital National Summoned By Receiver

Old directors of the Capital National bank, who managed it before the institution was closed following the banking moratorium, received letters Friday—by registered mail—from Joseph W. Gleason, receiver. They are "ordered" to meet with him in his office, Olds tower, where a demand for $77,161.59 will be made upon them by the comptroller of currency.

The letter alleges that certain dividends approved and paid by the board were illegal. These dividends were paid when the Capital National bank was solvent—a going institution. The former directors are to meet with Receiver Gleason, if they pay attention to the mandate of the comptroller of currency, at 10 o'clock Saturday.

See Possibility of Suit

Inferentially the "order" hints that the directors will face suit in court if they make protest or refuse to voluntarily meet the demand of the comptroller of the currency who has czaristic power in the liquidation and settlement of the bank's affairs.

The character of the comptroller's demands, especially at this time, is thought by some as having perhaps been an outgrowth of the protests of the depositors' committee relative to the delay of the comptroller in either permitting or disallowing the plan of local liquidation and discharge of the present receivership. Depositors' committee had presented a plan similar to the one authorized in Battle Creek and Detroit under which banks were liquidated by local trustees or committees.

in preparing for a continuation of guerilla warfare or fleeing to safety.

All officials of Magdalena, including the mayor and the entire police force, were reported to have fled toward Hermosillo when it was learned the main rebel body was encamped in a stronghold but 10 miles from the city.

Officials of several other municipalities in the same region also evacuated their towns, in three instances only a short time before raiders rode into the villages in search of the presidents.

Many Flee Across Border

Since the rebellion broke out the rebels have vented their wrath only against officials, leaving private citizens unmolested. Nevertheless, citizens able to obtain permits have been fleeing across the border into the United States.

Authorities here and at two other important border towns, Agua Prieta and Naco, are keeping a vigilant watch around the cities as reports continue that the rebels are ready to attack.

Mounted men are circling the city of Agua Prieta and civilians, armed by municipal officials, are patrolling highways leading from the south.

At Naco, old trenches used in the 1929 revolution have been occupied by officials and civilians in readiness for a raid.

A squadron of federal airplanes was ready Friday for another reconnaissance flight over the interior of Sonora in an effort to locate the hideout of the insurgents. The planes were out Thursday but were unable to locate the raiders.