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Text Of Rainey Testimony Reveals Warnings Of Crash
From Page Six) (Continued believed there was hope for more liberalized policy on governloans to He then continued listing his meetings with the local bank officials. January 2. 1933, on consultation with Kiesel and others an Sacramento. January 4. 1933. called on Matland Price relative to Sacramento bank, as chief national bank examiner. January 6, 1933. Matland, Price and Kiesel meeting with myself o'clock in the afternoon, with Mr. Kiesel in Matland's
TOLD OF DANGER. January 1933, have note in my book, "I took 7:30 ferry for Sacramento; from 11 o'clock until o'clock, in conference in state department office with Messrs. Klesel, Devlin, Kruse, Ruhstaller and Dillman." At time these gentlemen were told that they Mid been told before that the stocl Iders must produce some money to help this bank over its difficulties, they knew, and that there were withdrawals going on; they knew there were rumors about the condition of this bank all over this town and valley. They understood. They said they would see If they could raise million dollars, among themselves, for the two BANK RUN DISCUSSED. January 9th, in Sacramento; January 10th, Mark Skinner was in my office at o'clock in the afternoon with figures on the run. January 11th at Skinner, Mr. Lowell, my chief examiner, and called Mr. Matland, national bank examiner, in figures in connection with the run on this January had conference with Mr. Day Federal Reserve Bank relative to Sacramento, and Mr. Skinner was again in my office at o'clock. Then, there came, on January 13th. difficulties which had been culminating with the Bank Yolo and Woodland. After the meeting San Francisco, the directors of the Bank of and others, and and some of my people from my office left at o'clock at night for Woodland, and during that night had conferences which We thought might save the Bank of Yolo Bank Closed. This conference came to an end as failure on Sunday afternoon, January 14th, and, on 15th, was to the Bank of Yolo at Woodland. This had, some extent, an aggravating effect on the situation in Sacramento. January 17th, o'clock, met at Federal Reserve Bank. January 17th, Kiesel and the directors, and Mr. Day Federal Restrve Bank Mr. Colkins of the R. Mr. Clerk, the deputy governor; Mr. Matland Mr. Price, Mr. Lowell and Mr. Walker, one of my examiners were there. On January 18th, Mr. Walker and came to Sacramento, or to Woodland, and stopped in the way see Mr. Skinner, and discussed the affairs of the bank with him. $1,000,000 Deal Told. In the we had been told by Mr. Kiesel that he had practically completed rrangements for getting million dollars from banker in San Francisco. who would lend the money on individual resources, and the stockholders of this particularly the directors, were to notes and the money On January noon at Sacramento the aft. ernoon, there Henry my attorney and Mr. We were still very concerned over the thdrawals from the had been made the money to be put in by the directors
Kiesel Call Told. Woodland that night, Woodland that night. Mr Kiesel called Woodland and me Mr Scott Ennis was meeting the Clearing House Association at San they might consider condition of this bank and see what could be done to Was the Clearing House called for this specific
Giannini's Help Sought. Yes, and no That afternoon, on the 20th, 2:15 met Mr. Kiesel, A. Giannini, Will Morrish, president the Bank of America; Mr. Scott Ennis, and Mr. Marshall director accompanied by Mr. Walker. the idea being to see if Mr. support could be gotten for the Clearing House meeting the afternoon, at which one of his men would be present. That afternoon at o'clock, the meeting of the Clearing House took place, the of the San Francisco Clearing House, present Mr. MacIntosh: Lippman being of the Bank; Mr. Avanali of the Crocker Bank; Mr. Elsey. president of the American Trust: Pontius of the Anglo: Mr. Scott Ennis, Mr. Kiesel, Mr. Chief National Bank Examiner Mr. Walker and National Bank Examiner Price.
Bank Ordered Closed. At that meeting the situation of the was very freeand during the meeting made several attempts get the figures for the day as to the withdrawals made from the bank; and, finally got the withdrawal figures from Mr. Mark Skinner, and rethe meeting, and the next morning the bank by resolution of the board of directors. am giving you this, because want there was no snap judgment taken on this bank. They knew perfectly well they were in difficulties which they had to meet, and when say "they, mean the officers, directors and stockholders. GRAND JUROR: Mr. Rainey, you mentioned the directors Was that committee of directors, or all of the directors? Whenever meeting was arranged for the directors, they come to department, generally only few of them came. don't think we ever had a meeting of all the directors.
CLOSING ALL AGREED. JOHNSON: Were the directors. Mr. Kiesel and told at that meeting in San Francisco the Clearing House, that the bank was going to be closed. It was very generally agreed to In San Interposing: Wasn't it the understanding at that time, the next morning, that the officers themselves would draw resolution closthe bank? That was the understanding, and did McALLISTER: Mr. Rainey, are you familiar the details of the loan from the Chase Company of York? The Chase National Bank? the Chase National Bank, to this bank? Yes. How much collateral was up on that, the same as the R. F. C.? No. there isn't SO much. didn't get the exact figures. have the figures my possession. They borrowed six hundred thousand dollars from the Chase National Bank, and put up very good bond. We have reduced that some extent, and they owe, think two hundred and twelve thousand. The statement of January 20th. shows loans of $1,062,000. That means that the banks deposited collateral with the R. two and half times that amount? Approximately. In other words, two and half million dollars worth of securities are deposited with the R. F. C.? What will become of those securities? the loan is repaid, those securities eventually will be released to the bank, to liquidated. GRAND JUROR: Were there any other bond transactions similar to that? No. not that we have discussed. CHAIRMAN: No further questions. You will be excused.
