Highland Park State Bank - Highland Park, MI

Bank Information

Episode Type: Suspension → Closure
Bank Type: state
Start Date: February 1, 1933*
Location: Highland Park, Michigan (42.405, -83.098)

Metadata

Model: gpt-5-mini
Short Digest: 0e235ad4

Response Measures

None

Description

The Highland Park State Bank was among banks closed in the Michigan banking holiday of early 1933 and, according to RFC and court articles (July–August 1933), its assets and deposit liabilities were to be taken over by a new Manufacturers National Bank (transfer hearings in August). No specific depositor run on this particular Highland Park bank is described in the articles; the action follows government-imposed holiday/closings and subsequent RFC/R.F.C. intervention and asset transfer, so classification is suspension leading to permanent closure/transfer.

Events (3)

1. February 1, 1933* Suspension

Cause: Government Action
Cause Details: Closed as part of Michigan state/federal bank holiday and subsequent government-imposed closings in early 1933; bank did not resume normal operations independently afterward.
Newspaper Excerpt: the state banks at Highland Park ... were less liquid. (discussion of banks closed during the Michigan bank holiday)
Source: newspapers

2. August 13, 1933 Other

Newspaper Excerpt: the Manufacturers National Bank take over ... the Highland Park State Bank ... the petition for the right transfer deposit liability of the Guardian Bank, Dearborn, the Highland Park State Bank, the Peoples Bank of Highland Park ... was heard by Judge Richter and continued in hearings on Aug. 13, 1933 (Detroit Free Press). 'The Manufacturers National Bank take over inadmissible assets four institutions and assume their deposit...' take over at once the assets of the Highland Park State bank (Kalamazoo Gazette/Detroit Free Press).
Source: newspapers

3. September 25, 1933 Other

Newspaper Excerpt: Highland Park State Bank ... included $1,000,000 ... RFC advances ... Guardian Bank Dearborn, Mich., $2,000,000; Grand Rapids National Bank ... Highland Park State Bank, Highland Park, Mich., Peoples Bank of Highland ... (RFC report Sept. 25, 1933).
Source: newspapers

Newspaper Articles (5)

1. June 30, 1933 Jackson Citizen Patriot Jackson, MI

Article from Jackson Citizen Patriot, June 30, 1933

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Article Text

Number Two Continued from Page 1. ed Judge Keidan. Kanzler. "It has never been questioned. The corporation was organized in 1929 to deal in securities and that loan was made in time was as high as 000. has reduced to this amount. There was collateral on the loan and we indorsed it only when collateral did not present sufficient margin. The loan was approved by the bank's execcommitee.' Kanzler said the bank examiners never criticized the loan, but said he "supposed there is no question" that some of the loans of directors were Argument for Loan. Returning discussion of the Guardian units, Kanzler said one argument for loan was that would chain banks able to face almost any situation. "Our purpose was to strengthen them because they had competitor banks which were comparatively weak, he "In January our Port Huron bank faced substantial run bank across the street named the United States National bank had difficulty. would not have withstood that if it was not good. There is danger in banking group that one unit may get into difficulties and hurt the rest, so ve wanted them all strong as We could get them. At the time the loan was sought from the R. said Kanzler, the Guardian National Bank of was 41 per liquid, the Highland Park bank was 24 cent liquid. the Grand Rapids bank 30 per cent. Jackson Saginaw Flint 19. Port Huron 32 before the run which he mentioned 20, Battle Creek 35, Dearborn Royal Oak 87. Ionia 32, Niles 47, Trenton 10 and Hamtramck 44. "Did you ever ask the federal men why they opened other units and did not open the Guardian bank here it had liquidity of 41 per O'Hara asked. "Washington insisted that the Guardian bank and First National bank have be treated alike," said Kanzler able find out the reason for that attitude which they began to express as soon as the holiday was declared. of fact," O'Hara, "all but one of the National banks in your group which they permitted to reopen were less liquid than the Guardian bank here, weren't they the witness. "They opened the banks at Port Huron, and Creek, which were less liquid. They also opened the state banks at Highland Park and Dearwhich were less liquid. Kanzler discussing events leading up the refusal the R. loan. said he "had no question but what the loan made. He said to cover the quested, assets of face value of were selected collateral, and total of $330,000. worth of assets were available to pick Murfin Testifies. James former circuit judge bank attorney. today told the jury that days after calling of the Michigan bank hollday he was told by Mills. then secretary of the Treasury. that the First Bank Detroit was solvent and should not have been closed. Murfin also said a plan is making in which depositors of the First National would be paid 100 cents the dollar once. He declined make details of the plan public, saying that publicity would ruin Murfin's testimony followed that of Kanzler Under questioning rosecutor Harry Toy. he said was in Washington few days aft the holiday and was asked by bank associates in Detroit conwith Mills. and find out what the Treasury wished do in Detroit situation. He said he conferred for an hour Saturday. Feb. The banks did not open on the morning of Feb. told the secretary that had the closing the First National said told him following the closing. due to holiday. had urged the bank's board of directors to. reopen the bank arbitrarily and permit limited withdrawals. "That good why didn't they do it?' Mills to told him." continued Murfin, "that his agent, Leyburn (Alfred chief examiner for the Federal in this district) had declared the First National insolvent. had no right to do that, Mills Your bank solvent Had been insolvent. it would been my duty to have put in receiver only had the right to say whether or it was solvent' "Terrible Mistake." Murfin previously said he opposed the state bank holiday strongly. and declared he believed it was terrible mistake. He, said he was present the meeting the decision was made to banks. and was the only one to vote The witness further said that of not only sclosed no inkling of First insolvency in the National but, on the contrary. showed it was "making strong headway. said he was so convinced the strength of of the growing bank that, within the months previous to the closing. he bought 800 of stock. 200 December just before the closing Appeals to President. Lansing, Mich. June The state today had asked PresiRoosevelt to intervene Detroit to aid determining whether banks in closed without justification. Patrick H. O'Brien. attorney general. sent telegram to the Presiednt. stating that witnesses in the Detroit jury banking investigation testified the Guardian National Bank of Commerce and the First National Bank of Detroit are solvent and of paying depositors in full. Gov. Alex Groesbeck. and William F. Connolly receivers for banking offered testimony this groups. effect. Brien informed the President he denied access the comptroller of the books by the His telegram said: "Several of prominence influence in Detroit have testified the national banks now closed and the of govare solvent and of paying their depositors in full. that they should never have closed. that they were closed because or to some ulterior purpose, that the government was responsible for closing them keening closed and that with reasonable assistance from federal authorities either the system or the Reconstruction Finance tion these two great banking institutions could be reopened. Brien's telegram read. "We have asked for the cooperaof federal authorities towitthe Treasury department and the comptroller of the currency in ord er that we might the books and records of banks. and from the testimony of nesses having access to said books the exact facts The of the has refused on legal grounds to permit us access to the books and We have not received reply from the Treasury department. "The have been subpenaed but have declined to testify on the ground the state has no jurisdiction. it is important the people of Detroit and vicinity know the reasons why said banks have been closed and not allowed to reopen. If it is true they are should be permitted to reopen with such reasonable help from the government as would proper the circums If the banks are hopelessly insolvent think the federal government should voluntarily present the facts so the people will be satisfied these two banks have been treated fairly there been no crimination banks prove to solvent they ought be and they are inthe people know request. Mr President. that you extend the courtesy of personal interview on the whole matter of the banking situation in Michigan. with particular to the two national banks in the city of Detroit. there the contrary would like to the federal government release the attorney general's office witnesses, books and records may the true situation. the meantime the one-man jury now sitting in Detroit will main open until have made your final determination in these matters.

2. July 14, 1933 The Kalamazoo Gazette Kalamazoo, MI

Article from The Kalamazoo Gazette, July 14, 1933

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R.F.C. ANNOUNCES $75,000,000 LOAN TO DETROIT BANKS Early Release of More Money to 800,000 Depositors Expected. (Continued from Page One) gation now pending over the priority of savings deposits is settled. NEW APPRAISAL BASIS The new loans to the banks were made available on the basis of second recently completed appraisal of collateral and securities of the two Referring to the Guardian National loan, statement says: "This loan can be made on colfrom $30,000,000 to $37,000,000. depending upon the exact amount of the loan. This would leave the receiver with assets of more or less certain nature, in face These assets and the equity in C. collateral might be used as the nucleus of The statement points out that the deposit liability in the First National bank much greater, and referring to the First National loan of $50,000,000. continues: NATURE OF COLLATERAL "This additional loan of $50,000 000 together with now owing the corporation, would be secured by collateral aggregating in round numbers In view of the pending litigation, the consumation of this loan, and disbursement of the funds will depend upon the R. and the comptroller of the currency being satisfied as to legality and propriety of such distribution "Aside from the collateral that the corporation will require for its loans to the First National bank The receiver would have remaining assts in the face amount of approximately of property and securities of uncertain or undetermined value. In possible reorganization of the First National bank, additional funds may be provided by the stockholders that would enable larger distribution to depositors than the 15 per cent above mentioned. CAN NOT PAY 100 PER CENT The opening portion of Jones statement points out that clearly evident after careful examination that neither of these banks can be reopened or reorganized to pay depositors 100 per Thus Director Jones contradicts the testimony of numerous banking officials here during the current grand jury investigation, who have said on the witness stand that the banks, with moderate assistance from the government, could reopen and pay depositors 100 per The new bank contemplated by Edsel Ford and associates would be known as the Manufacturers National bank. Its initial capital would be with surplus of 500,000. and undivided profits of Plans call for the disposal of shares of stock in the bank to the general public,- although the capital already has been subscribed. Organizers of the Ford bank named in its petition for a charter by Clifford Longley revealed subscribers in addition to those named above to be: Emory W. Clark, Fred Wardell. W. S. Knudson, E. D. Stair, William T. Barbour, Alvan Macauley, Clarence H. Booth. C. Aaron De Roy. Dr. Fred T. Murphy Murray W. Sales, Henry Shelden and George I Fink ORGANIZERS' STATEMENT In their statement, organizers of the Ford bank said: "The men who are backing this undertaking believe that Detroit must take the initiative and build back its credit structure. They are unanimously behind this. and with united front they are, through the of this essential 'It is proper to say on behalf of the large industrialists of Detroit that in all of the negotiations regarding these two banks they have all times signified desire and willingness to co-operate with the R. C. and the treasury department in efforts to adjust the banking situation." The statement describes the subscription by Donaldson Brown and Alfred P. Sloan, Jr., of the General Motors Corp. of for formation the National Bank of Detroit, and the subsequent offering of the stock for sale, "Mr. Ford and others were invited at that time to take part of this stock, but with the exception of Mr. Walter P. Chrysler they felt that they could help in other ways, and did not directly participate." 20 PER CENT PAYMENT The statement, describing plans for the Ford bank, the Manufacturers' National bank, says that the 20 per cent payment to depositors of the Guardian National bank will be made through it. The Ford bank, Jones' statement says, will take over at once the assets of the Highland Park State bank, the People's Wayne County bank of Highland Park, the Guardian bank financial institution, initiating program which they firmly believe will not only provide relief from the existing situation, but will best serve the community and its citizens both now and in the future. Jones in his statement refers to the part by Detroit's business leaders and industrialists in efforts to habilitate the city's financial structure, saying: of Dearborn, and the Dearborn State bank. This gives Detroit another large, substantial bank and again demonstrates the practicability of co-operation between the government and industry in the general welfare, the statement continues. "It should also be understood that there is not the slightest confliet between any of the big industrialists in the organization of this new bank and the National bank of Detroit. The Ford interests, General Motors and Mr. Chrysler have all made it clear that they have no desire to engage in the banking business. They have made these investments for the sole and only purpose of giving to Detroit proper banking facilities, and to release as much as possible of the deposits in closed AID OUTSTATE BANKS DETROIT. July With reappraisals of assets in Detroit's closed National banks completed, Howard J. Stoddard, chief of the Reconstruction Finance Corporation's examiners in Michigan, expects work to without delay in organization and reorganization of outstate banks. New banks are to be organized in ten industrial centers, Stoddard said, naming some of them. In Pontiac, he said, new bank is take the place of the First National bank, while progress being made on new bank in Jackson. In Grand Rapids. he said new bank is to replace the Grand Rapids National with 50 per cent payment to depositors planned, while the Grand Rapids Savings bank is being reorganized. In Flint, $400.000 will be advanced by the R. F. for new bank, augmenting locally raised capital. Examiners are working in Battle Creek. Stoddard said, but expect soon to move to Saginaw, He did not name other cities.

3. August 13, 1933 Detroit Free Press Detroit, MI

Article from Detroit Free Press, August 13, 1933

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Bank Receiver Haled to Court Thomas Subpenaed in Assets Transfer By Jack Weeks subpena compel the First Na. tional hearing Circuit Court the proposed transfer of assets and liabilities from four banks the new Manufacturers National Bank was by Judge Theodore Richter The transfer has approval everyone involved. except Mr Thomas The through his Robert refused appear Court and likewise would not grant his approval outside of nowever Attorney Marx had testified by Clifford Long ley counsel for the National assured his Marx Urged Not to Resist In addition. Comptroller of the fied Longley that he had vised Attorney Marx to object the Mr. Longley Gov Alex for dian Group: William Connolly, receiver Detroit Bankers and State Commissioner Rudolph E. Reichert all tified that they considered the plan feasible in the best interests community The testimony was given double hearing Judges Adolph heard the petition for the right transfer deposit liability of the Guardian Bank Dearborn the Highland Park State Bank. Judge Richter heard the petition on the PeoWayne Bank of HighPark The fourth bank the State Bank Mr were based fact that the Peoples Bank of Highland Park member the Bank Co. As receiver for the First also Detroit unit, he contends that the holding company bankrupt that transactions ing are matfor the Federal Court refused regard Judge Richter's Circuit Court as having jurisdic- Plan Has R. C. Approval The plan. which has the full proval nance Corp., provides the Manufacturers National Bank take over in admissible assets four institutions and assume their deposit Please Turn to Page 2-Column

4. August 13, 1933 Detroit Free Press Detroit, MI

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Bank Receiver Haled to Court Thomas Subpenaed in Assets Transfer Continued from Page One liability up to that amount To meet the remaining deposit liabilwhich amounts approximately the has agreed to lend that amount on the banks' These assets then be dated with the approval of the addition to expressing their outlying bank approval plan, witnesses asserted that they believed similar system could used in paying positors Bank and the First National Speaking counsel for and director the Bank Mr. Longley testified that believed that institution would willing over admissible assets the Guardian National assume equal deposit bility, as the of the four suburban witness added that such creditors the institutions the Ford Motor Co., Edsel B. Ford and the Continental Bank Chicago, whom he repredid not object to the fourbank plan. discussed the plan with Mr him his right Longley testified 'Mr. Marx dictated statement which that would not object to the transfer Later the day conferred with Mr. Thomas they decided that they would not sign the statement. immediately telephoned Compand told him what our He then sent the have wired Judge Marx by Longley the sale assets, feel must leave this matter your judgment as to the course protect interests the suggest that see jection be for Mr. Longley's that the receiver advise the National Bank by letter that he understands purchase certain assets the Highland Park Bank dollar for dollar basis and that he has objection to the that he competent object such trust the foregoing will enable the matter worked for (Signed) Asserts Marx Refused Waiver not the consent.' Mr Longley night received commitments from under the plan. then got touch with Judge Marx and refused give me his He stated that diction the and did not intend court. Former Connolly followed Longley the stand and testified concerning Receiver Thomas contention that the Detroit Bankers Co. insolvent. Referring loan company from the Guaranty Trust Judge testified that Marx had dictated the terms of an agreement which enabled the Guaranty Trust sell the collateral the loan and then had contended later that of collateral was an of bankruptcy. Judge Connolly's refusal to tify the absence led the adjournthe and the order for subpena for Thomas The double hearing continued until m. Monday Before court closed. Marschner opinion plan was advisable announced in the case of the banks under his jurisdiction would an permitting the transfer He held the order abeyance pending settlethe controversy Thomas Groesbeck Praises Plan testified he engaged the big the plan way to achieve admissible assets of the Guardian National amounted $20,000,000, the Manufacturers National National Bank Detroit assume that the deposit liability the would make loan the maining assets that most deposit liability could made available the depositors, It very simple formula. liquidation could be the hands trustee could terminated slightest doubt that the depositors would co-operate Judge Connolly and suggested plan to Jesse Jones, the and Comptroller O'Connor Connor told that he wanted to the in he the National and the First 'Both Judge Connolly and got from and that would allowed to their appraisals the First Na tional the Guardian National But after were told could them. Wants Guardian Considered "Consequently, have to sume the Guardian National's comparable the assets banks and believe they there's earthly the same conshouldn't given the Guardian National depositors has been given the depositors of the suburban "There no outstanding or seriobstacle to solving the problem of satisfactorily and equitably and care of the Guardian's deposit liability Mr. Groesbeck that the $20.000,000 admissible provide for per cent payoff in addition the per that has already been Mr. Reichert's approval of the four bank plan was given his position conservator for the Detroit Co. and the Union Industrial Trust of both well in his position as State Banking The petitions for court approval the transfer presented by Attorney conducted the questioning of the four witnesses. Are you going camping? Perhaps the want get the other equipment you will be needing.

5. September 25, 1933 Fort Worth Star-Telegram Fort Worth, TX

Article from Fort Worth Star-Telegram, September 25, 1933

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Advanced by RFC During August WASHINGTON, Sept. Finance Corporation Monday reported to Congress that during August it authorized advances aggregating $111,495,529. The report, made public by South of the House, showed was authorized loans banks, companies, railroads and institutions. total turned to Federal Relief for distressed States. That brought the amount under act to Aug. 31. Of loans to financial institutions, $36,178,287 went banks trust companies. This included $17,aid the liquidation of banks closed or in process liquidation. Other advances were listed as follows: To building and loan associations, insurance companies, $650, mortgage companies, $3.Federal Land Bank Omaha, $2,000,000 : Agricultural Credit Corporations, stock Credit Corporations, Corpothe cago Northwestern ComApplications for loans filed by fed institutions August totaled 221, as follows: 148 from banks and trust three each from building and loan and surance companies: 20 from mortgage companies: each from credit union, Federal Land Bank, Joint Stock Land Bank, railroad and from State insurance fund from Agricultural Credit Corporations and from Regional Agricultural Credit Corporations. Of the other advances authorized, $3,500,000 went the Agriculture for 500,000 the Secretary of the Treasmake payments Federal ury Home Loan stocks; $3,200,000 the Land Bank Commissioner facilitate loans on farm mortgages. The corporation sold $70,000,000 making total $1,690,000,000 notes outstanding at the close of business on Aug. Among some of the larger leads au thorized Federal National Bank Trust Washington, the Commercial Bank of Washington (receiver), $1,885,000 District National Bank, conservator, Washington, the City Savings Bank Trust Company ShrevePresque Isle National Bank, conservator, Presque Maine, $1,378,000; Dearborn State Bank, Mich. $2,539,000; Guardian Bank Dearborn, Mich., $2,000,000; Grand Rapids National Bank, conservator, Grand Rapids, Mich., Highland Park State Bank, Highland Park, Mich., Peoples Bank of Highland authorized includ$1,000,000 to the East Tennessee National Bank receiver, Knoxville: the County Corporation of Cambridge, Md., $1,600,000 New Mexico Corporation, Albuquer$400,000: Lebanco Realty Investment Company of Louis, $2,048,000. Loans previously authorized and withdrawn canceled during August totaled Receipts the corporation during the month amounted expenditures totaled $149,064,634.