First National Bank - Union Bridge, MD

Bank Information

Episode Type: Suspension → Closure
Bank Type: national
Bank ID: 9066
Charter Number: 9066
Start Date: June 2, 1922
Location: Union Bridge, Maryland (39.569, -77.177)

Metadata

Model: gpt-5-mini
Short Digest: 9f676f9c

Response Measures

None

Description

Articles report discovery of a large shortage caused by the cashier's embezzlement. Directors closed the bank and asked the Comptroller to take charge (national bank examiner sent). No run is described. The later article (July 1922) discusses efforts to raise funds to avoid receivership but does not report a reopening; outcome is unresolved in the provided texts, so I classify as suspension_closure because the bank was closed and federal examiners/responders were involved and receivership was considered. Significant OCR corrections: 'Fi National Bank' -> 'First National Bank'; 'Peltimoro' -> 'Baltimore' in Article 1 context.

Events (4)

1. March 14, 1908 Chartered

Source: historical_nic

2. June 2, 1922 Suspension

Cause: Bank Specific Adverse Info
Cause Details: Discovery of a large shortage due to cashier E.F. Olmstead's embezzlement/speculation (initial estimates $50,000 to possibly $75,000; later revealed much larger).
Newspaper Excerpt: Friday, the directors closed the bank pending further examination and requested the Comptroller of the Currency to take charge. Thomas Kane national bank examiner, was sent Union Bridge and is now in charge
Source: newspapers

3. July 6, 1922 Other

Newspaper Excerpt: The Town Hall was filled to capacity with depositors ... The gross shortage was given out. This amounts to $168,367.92. The directors ... asked each depositor for a contribution amounting to 11 per cent. of his or her deposits ... to avoid receivership and continue the business with banking interests instead of allowing it to pass into receivership. The directors ... would withdraw their proposed contribution of $28,000 if forced into liquidation . . . . -Union Bridge Pilot. (quoted in Catoctin Clarion).
Source: newspapers

4. August 28, 1922 Voluntary Liquidation

Source: historical_nic

Newspaper Articles (2)

1. June 2, 1922 The Democratic Advocate Westminster, MD

Article from The Democratic Advocate, June 2, 1922

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Article Text

CASHIER A DEFAULTI EDW. F. OLMSTEAD, CONFESSES USING UNION BRIDGE BANK FUI TO SPECULATE-SHORTAGE ABC $50,000. E. F. Olmstead, cashier of the Fi National Bank of Union Bridge, I confessed to the board of direct that he is a defaulter to an unkno amount. He admits that he has us the money in speculation. He is at home under close surveillance. Neither the bank officials nor 1 Federal Treasury officials who : working on the accounts, will appre imate the shortage, which is in 1 savings department, but they say may reach $75,000. E. O. Cash, this city, who is 1 I heaviest stockholder in the bank, came suspicious some time ago tl all was not well with the instituti About three months ago he was ele ed president in place of Jacob Gladhill. who resigned and took 1 place of vice-president, and at or egan to look into the bank's affair Investigation showed that the was something wrong, but the sho age at first seemed to be only abo $4,000. Friday, the directors closed t bank pending further examination a requested the Comptroller of the Ct rency to take charge. Thomas Kane national bank examiner, was sent Union Bridge and is now in char although Mr. Cash and other ba officials are assisting him. It is said that individuals in t community may sustain consideral losses through the disappearance bonds which they had intrusted to I Olmstead. for safekeeping. These we not deposited in the bank and no ceipts were given, and it is said tl in such case there is no liability the part of the bank. It is believed that the bank will reorganized and that the deposito will lose nothing. The bank has a ca ital stock of $25,000, with surplus $22,500 and undivided profits of $ 500. It has been paying annual di dends of 10 per cent. and the last S of the stock was at $197.50 a share Olmstead was a teller in the Nati Bank of Peltimoro .

2. July 6, 1922 Catoctin Clarion Thurmont, MD

Article from Catoctin Clarion, July 6, 1922

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Article Text

PUBLIC NOTICE OF UNION BRIDGE BANK SHORTAGE The Town Hall was filled to capacity with depositors and patrons of the First National Bank last Saturday when the first public notice of the gross shortage was given out. This amounts to $168,367.92. The various assets and assessments, including a contribution from the directors has reduced the shortage to a little over $30, 000. If this amout is raised the business and building will be taken over and continued by . large banking interests. With this in view, the directors, rather than allow it to pass into receivership, concluded to ask each depositor for a contribution amounting to 11 per cent. of his or her deposits. This would yield practically $50,000 if all concur in this movement, reduce the per cent. asked for materially. Isaac Lobe Straus, a prominent and reputable attorney of Baltimore, was brought here by a number of depositors for impartial advice in connection with the bank. After a survey of the situation he made a statement that the proposed proposition to raise the remainder of the shortage was the only way to minimize the loss to the depositors, for he, as a lawyer, knew the great expense and its attendant delay in having receivers appointed. Should this plan of liquidation be forced on the bank, the directors would withdraw their proposed contribution of $28,000 and the amount the depositors would then get is variously estimated at from 50 to 75 cents on the dollar, to say nothing of a delay of a year or more. The directors and all interested in the bank are meeting with much encouragement and it is to be hoped that all will realize that the first loss is best and come forward and sign for this form of liquidation and thereby save, not only the greater portion of their earnings, but much time also. -Union Bridge Pilot.