Citizens State Bank - Franklin, MN

Bank Information

Episode Type: Run Only
Bank Type: state
Start Date: November 1, 1925*
Location: Franklin, Minnesota (44.529, -94.883)

Metadata

Model: gpt-5-mini
Short Digest: 52d52759

Response Measures

Accommodated withdrawals, Capital injected, Books examined

Other: Board reorganization and sale of block of shares to local investors

Description

Article (Nov 11, 1925) describes a run triggered by false rumors that drained about $45,500 over a few days. The bank met withdrawals, directors and examiners intervened, and most funds were returned; there is no mention of suspension or permanent closure.

Events (1)

1. November 1, 1925* Run

Cause: Rumor Or Misinformation
Cause Details: Run caused by false rumors regarding the soundness of the Citizens State Bank of Franklin; described as malicious and rank falsehood.
Measures: Bank paid out withdrawals promptly which stemmed the tide; board of directors met, president resigned and replacement elected, state examiners and a Minneapolis bank representative outlined and helped implement a plan; block of shares offered for sale to strengthen capital.
Newspaper Excerpt: False Rumor Causes Run on Franklin Bank CITIZENS STATE BANK OF FRANKLIN SUSTAINS DRAIN OF $45,000 RUN IN TWO DAYS AND COMES THROUGH INTACT
Source: newspapers

Newspaper Articles (1)

1. November 11, 1925 The Redwood Gazette Redwood Falls, MN

Article from The Redwood Gazette, November 11, 1925

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Article Text

False Rumor Causes Run on Franklin Bank CITIZENS STATE BANK OF FRANKLIN SUSTAINS DRAIN OF $45,000 RUN IN TWO DAYS AND COMES THROUGH INTACT Caused by false rumors regarding the soundness of the Citizens State Bank of Franklin, a run was made on that institution last week, causing a withdrawal of $45,500 of deposits within a few days. The ability of the bank to pay out the withdrawals without hesitation stemmed the tide, and the greater part of the money drawn out has been returned. A meeting of the board of directors was held last Thursday, at which R. J. Neunsinger voluntarily resigned as president of the bank and E. F. Johnson, of the firm of Johnson Bros., was elected to fill the vacancy. Two bank examiners and a representative of the Northwest National Bank of Minneapolis were present. These gentlemen outlined a plan which has been adopted by the Citizens State Bank and will no doubt be the means of making this bank a strong going concern which can assure all its patrons that their interests will be safeguarded. A block of shares in the bank has been offered for sale and The Tribune understands that the shares are being taken by a number of prominent men of Franklin and vicinity. With this block of shares distributed among a wide circle of substantial holders, the Citizens State Bank should be in a better condition than ever before. It is generally conceded that a banking institution which can withstand a run of this magnitude must be in good condition, and this bank's ability to avert a disaster at this time proves the rumors to be rank falsehood, apparently started with malicious intent. Evidently those instrumental in starting this rumor were not familiar with the true condition of the bank, and it is due only to the leniency of the directors of the bank that those. who circulated the false report are not being made to account for their actions. The Citizens State (Continued on last Dage)