Farmers Bank - Homer, MI

Bank Information

Episode Type: Run → Suspension → Closure
Bank Type: state
Start Date: August 1, 1837*
Location: Homer, Michigan (42.146, -84.809)

Metadata

Model: gpt-5-mini
Short Digest: 93d9a817

Response Measures

Full suspension

Description

Article (1926) recounts the founding of the Farmers' Bank of Homer in August 1837, issuance of worthless paper, an investor run, and collapse; the organization died in 1839. There is no explicit mention of a formal suspension or receiver, but the run directly caused the bank's collapse and permanent closure — best classified as run leading to closure. Bank charter type not stated; 'National' banks did not exist in 1837, so bank_type set to unknown.

Events (2)

1. August 1, 1837* Run

Cause: Bank Specific Adverse Info
Cause Details: Bank issued extravagantly worthless paper notes and capitalization was largely speculative real estate, undermining solvency and prompting withdrawals.
Newspaper Excerpt: Investors made run on the bank, which consequently collapsed
Source: newspapers

2. January 1, 1839* Other

Newspaper Excerpt: the organization having died in 1839 after reaching the peak of its business in 1838.
Source: newspapers

Newspaper Articles (1)

1. May 27, 1926 The Homer Index Homer, MI

Article from The Homer Index, May 27, 1926

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Article Text

Founder of Homer Establish ed First "Wild Cat" Bank in State Milton Barney Originator of Banking System Which Deluded Many in Michigan Also Village's Civic, industrial Leader. To the founder of the village of Homer laid the establishment of the first "wild cat" bank in the state of Michigan. This man, Milton Barney, son of the famous inn-keeper, Nathaniel Barney, of Battle Creek, was all but the destroyer of the settlement he created and the originator of a form of banking which left trail of worthless paper money and deluded investors across the state. It was in August, 1837 that this first "wild cat" bank appeared under the name of the Farmers' Bank of Homer with Milton Barney as its president, Asahel Finch, then state legislator. cashier, and Barney, Finch, Elisha Thorton, Arza Lewis, Hiram Smith, N. D. Skeeles, Walter Wright, all of Homer, and Leonard Stow of Concord as directors. The bank was capitalized at $100,000, large sum in those days and COD sidered sufficient to insure perfec seculity to investors who flocked to the bank from all parts of the township. All business of the bank was transacted at first over a counter in the back part general store, the first frame building in Homer but soon became that new structure, the first brick building in the village, was started. Before this building was completed, however, it became known that most of the $100,000 capitalization of the bank consisted of hopes for the realiza tion of certain real estate ventures and that the paper money which the bank was issuing so extravagantly was of more value as wall paper than as the contents of pocket book. Investors uade run on the bank, which consequently collapsed and the new building was never used as banking house. This ended Milton Barney's banking ventures, the organization having died in 1839 after reaching the peak of its business in_1838. Although existing but a short time this form of banking spread from Homer to other parts of the state with amazing rapidity and 'wild cat" banks began to spring up in the most remote spots. Paper money became of less good than pebbles and the settlers, leary of fraud, soon went back to their dickering and barter as they had done before the establishment of such an institution as bank. G. French, one of the older residents of Homer now can recall hearing his father, G. H. French, who was state senator for several years and largely responsible for bringing two railroads through Homer, telling of those days when Barney's bank was flourishing They were hectic days which heated the blood of the gambler and gave rise to wild speculation. Mr. French can remember his father speaking of Barney as a man of great ability but of temperamental nature inclined to spells of depression. Although Barney's "wild cat" Idea caused great havoe in the state as well as the village of Homer until it was halted by congressional action, there were other ideas of his which are largely responsible for the existence and present prosperity of the town, according to the memory of some of the older residents. For Barney seemed to be the leader in every civic and industrial undertaking in the early days of settlement. It was at his home that the first meeting of township board was held when bounty of $1 for every wolf shot and killed was voted as the first legislative business and he was one of the three original school inspectors. Barney was also the builder of the first mill in this locality and platted and sold lots in a settlement called Barneyville, later part of Homer. He is also credited with being the builder and proprietor of the first hotel in the village. Barney was also one of the leading sponsors of the proposal for canal to connect the Detroit river and Lake Erie with Lake Michigan following the channels of the Huron and St. Joseph rivers. A survey of the intervening land showed that the project was feasible and the residents of Homer became 80 enthused over the idea that when the Michigan Central railroad was preparing to construct its main line through the village, they turned cold shoulder. The railroad was then built around the village in more circituous route thus building up other towns and leaving Homer outside. The canal scheme fell through and realizing their mistake the village a cordial welcome to the Air-line and Northern railroads when they started their tracks in the direction of Homer. After losing a large share of his fortune new hope in the gold rush of 49 and left Homer for California with many other residents of the village. But he failed to recoup his resources and he died there broken in spirit and health. Battle Creek Inquirer News.