Article Text
more on deposit in some and some months less. Mr. Horst denied the report that $10,000 had been drawn from another bank a few days ago and deposited with the Germania bank. Still the report is street talk. The bond given by the Germania to protect the city deposits is signed by the following gentlemen as sureties in the sum of $100,000: John Klein, John B. Hermann, Joseph Haag, E. F. Berrisford, William Schornstein and Albert Spangenberg. The bond has been approved by only one branch of the common council and is being considered by the ways and means committee of the assembly. This the city authorities claim will not prevent suit being brought against the sureties, if this action should be considered necessary. The following statement from President Gustav Willius explains itself: St. Paul, Jan. 4, 1897. To the Stockholders and Creditors of the Germania Bank: In January, 1896, the directors of the Germania bank tendered me the position of president. My predecessor having declined a re-election, and there having been a great deal of talk and gossip regarding the bank, the directors desired very strongly that I should accept the place at once, without a previous examination, assuring me that the bank was in a good condition, although the existence of some bad paper was admitted Upon the strength of this assurance I accepted the position and assumed its duties on the 17th of January. I then entered upon a careful examination of the affairs of the institution, and found its capital impaired to a larger extent than I had reason to expect. of which result I advised the directors in a full meeting. Shortly after my election, the Hon. M. D. Kenyon, superintendent of banks, also made a thorough examination, with a similar result. It was at once evident to me that it would require an assessment of 50 per cent and a reduction of 25 per cent of the capital stock, to entirely remove the impairment and start the bank on a new career of success and prosperity. The Hon. M. D. Kenyon fuly coincided with my views, and it was agreed that the assessment should be made on the 1st of November, 1896. In the meantime the officers were to use their best efforts to strengthen the bank by increasing its cash by collection of bills receivable. I labored conscientiously in that direction with good success, and improved the assets of the bank considerably; but owing to the free silver agitation, a great many deposits had been withdrawn, and when the time fixed for the assessment arrived, I had another consultation with Mr. Kenyon, with a view of having the assessment postponed until May 1, 1897. As soon as the result of the presidential election became known, matters began to improve in a remarkable degree, and there did not seem to be any doubt that on May 1, the bank would be in so strong and impregnable a condition, that the assessment could successfully be made. This was the situation on the 22nd of December, when the suspension of the Bank of Minnesota occurred, following immediately upon the failure of the National Bank of IIlinois, at Chicago, which came as unexpectedly as a stroke of lightning in mid-winter and caused general alarm. The four Minneapolis bank failures increased the panicky feeling, but I did not fear any disastrous outcome, until it became apparent that certain evil-disposed persons maliciously directed the attack towards the Germania bank, circulating false and manufactured reports regarding it from one end of the city to the other, with systematic persistency. Those people are a veritable pest and they deserve the contempt of the entire community. I hoped from day to day that the excitement would subside and make room for better judgment, but it grew in intensity. The attack became bolder every day. After the close of business, on Saturday, the 2nd of January, we found that the withdrawal of deposits had assumed such dimensions that we did not feel justified to continue receiving deposits or to pay out money, beyond that day, without having submitted the condition of affairs to the directors. Consequently we called a special meeting of the board on said day, at 7:30 p. m., for that purpose. We had paid off nearly $225,000 deposits in nine business days and kept on hand and in reserve something over $100.000 cash means, which shows the unreasonableness of the panic. The directors, after having weighed the matter in all its bearings, came unanimously to the conclusion that the action of the officers had been correct. and that, however deplorable it might be, it became their duty for 'the protection of all depositors and other creditors, to close the doors, and to place the assets of the bank in charge of an assignee. Mr. Kenyon is entitled to the gratitude of all parties concerned. for the wise and liberal policy pursued by him towards the bank since my connection with it, which was calculated to avert disaster. It is the intention of the directors to take immediate steps towards the reorganization of the bank, upon an absolutely sound basis, free from all questionable assets, and it is to be hoped that every interested party will come forward and help. If we meet with the proper encouragement and assistance, the bank ought to resume not later than April 1, next. Very respectfully, GUSTAV WILLIUS. The report of the condition of the bank at the close of business Dec. 17the last public report to the state examiner-shows: ResourcesLoans and discounts $975, 53