The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1877-04-25
SAVINGS BANK INSOLVENCY.
CONTINUATION or THE INVESTIGATION By THE
SENATE COMMITTEE OF THE CHARGES

chanic5 and Traders Savings Bank Tho examination
was long and tedious. very startling developments
having been drawn IRON the witnesses testimony. The
mos, important testimony elected was that Of MT
Bethany counsel for Aessrs Floyd Gregory, who In
1874, on their request presented a complaint TO the
Bank Superintendent and demanded that the bank be
closed in the interest OF tho depositors The cxamina
ton Will be continued to-day. The taking OF testimony
did not begin lill about half-past eleven.
EXAMINATION
The first witness called was Mr.. j. NJ Jack son, OF
Brooklyn, . real estate expert connected with the
Loriliard estate. He had in 1874 appraised the bank
building at $50 900; three weeks ago he valued the
building at $50 ooo there was very little real estate
sold In its neighborhsod; witness didn't know very
about the value OF property in the neighborhood
not being interested the property near there; real
estate values began decline in 1874 they had gone
down very materially, from forty TO atty per cent;
there were but few sales Of real estate except those
made under foreclosure or mortgage
Sir. Frederick p. BeIamy, counsellor at-aw, vi
Brooklyn, was next called In September 1874 he
was retained by William Floyd and Ira Gregory,
tees or tho bank TO look into Its affairs and take
stops the protection or the trustees ana depostors
they brought him statement purportng TO show that
the bank was largely insoivcnt; witness prepared q
summons aud complaint against Mr. Ella This paper
was offered In evidence The most important item It
contains reads as iollows:-
Tho following table correctly states tho items
recty stated in schedule =
coa ovsr Mar Marked vai4s
ket Value. Over Cost
Stocks OF other States. s24s, 4ss rs
Stocks OF counties,
cities and towns. $l1902 90
Real estate. v,Oy2 20
Total. ......... $50, 994 rs
Total depreciation $22S. 444 so
Witness saw Mr. Ellis in his once In Albany told
tho latter that he had at the request Of Of
his clients in reference 70 the affairs Of the Mechanics
and Traders Savings Institution; showed HIM the
paper showing the bank to DO insolvent from 900
$2ooo0o; said that hts clients thought the bank
should be closed up; the complaint was compared
with the report OF the bank examiner; called tho
Superinte ndents attention specially 10 the Southern
securities; Mr. Ellis said he did not approve OF tho
bank beng put into the hands OF receiver but he
would come to New York to examine tho matter: he
went down with witness to New York the same day
tho latter had the interview with him.
On cross Examination Mr.. Beilamy said shat he had
presented tho papers to Mr. Farchild the Attorney
Generals Office; Mr. Fairohild said he had evory
Idcnce in Mr. Ellis aud any action In regard TO
tho bunk should como through Mr. Ellis drst; the next
day witness saw Mr.. Ellis The summons and
plant In the action were drawn up, with view TO
having the Attorney General proceed IN the matter,
but the latter would not act on those papers The
main points OF difference between the complaint and
the directors report were the values put the South
securities. In the reports OF the banK they
placed NJ much higher figure t
Mr. McKcon next offered in evidence part OF section
or tho act OF incorporation OF tho Mechanics and
Traders Savings Institution IL stated that moneys
might be received on deposit ior the purpose OF being
invested government securities any public STOCK
created under and ny virtue OF any law OF the United
States or OF this state, or IN any stocks or bonds
tho Legislature OF tins state Mr. McKeon
claimed that this section restricted the bank
ties, except IN tho case OF government bonds He also
offered IN evidence the ACT Of April ID 1853, which had
So proS owl that
~ such Investments the stock or securities
ut OF above par value. long discussion ensued be-
tween Mr.. Chapman and Mr.. McKeon us 10 tho adms-
sibty OF these documents evidence Mr.. Mckeon
urged that they were public acts. After some deber
the committee decided 10 receive such oil
the acts related to the case
VALUES SOUTHERN STOCKS.
ar. John L. Manning. banker aud broker was
called expert give the value Of bonds
held ny the bank on october 1874. OF South Caro-
bonds there three Classes the old South Caro-
linas, Tho January and July and the non-fundabie
bonds On October 2, 1874, the old bonus
quoted Ut TO- tho January and July at II and the
TX 90 respectively. or North Carolinas tnero
thirteen kinds, nvc OF which KINDS were
an.e.war bonds we're quoted 2ot. tho North Caro-.
Ina Railroad bonds at Az the lS54's al AZ the '6s's
a and me now bonds a. l2h. or me kind OF Ala
but recorded sale, that was at 90, shortly alter
their issue. In October 1874, there was no sale Tor
them; witness did not believe they would bring ten
the dollar The Tennessee bonds held by the
bank were quoted at 81 Witness took his quotations
IRON registered stock list by the New York
Stock Exchange, which before HIM and copies Of
which he had preserved IN bis Office.
REAL ESTATE VALUES.
Mr. John 4. James, real estate agent, OF Brooklyn
was called as expert 10 determine the value OF the
banks real estate situated at Nos 30 and 81 President
street, Brooklyn No. ~, the corner piece, was worth
about $14 600, and tho Other, ut No ~, was worth
about S. 0O0 the cost OF those buildings was much
$40 900 witness differed nom Mr. Jacksons esti-
mate he thought that the depreciation IN real estate
had begun as lar back as 1872 the depreciation had
been fully SO Per cent Mr.. Chapman on cross-exam-
ination put some questions trying 10 show that the
estimates OF the value Of the building were merely
Mr.. William J. Best was again called to the witness
char. The question nrst asked ny MIR. Mckcon was
..Can you state what The condition OF the bfnk
when you became receiverY' and The rexL "what
was the deficiency ut the time you made
ceivcry" Mr. Chapman Ut once objected
aud long argument entered between
counsel. Mr. Mckeon urged that ne had right TO
show The disastrous consequences oil Mr.. Es' neglect
while Mr. Chapman sad that the inquiry should be
strcted merely 10 the question whether there any
neglect between the time when Mr. Ellis the first
examination and tho time when he handed the matter
to the Attorney General The committee decided
that the question was lDadmssibc. The examination
then continued. Mr.. Best said that there we're
were about 800 deposors in the institution he had
paid per cent OF the deposits and had
left IN his hands SILL These assets consisted OF bonds
aud mortgages IN process vi foreclosure, about
$4,000; OF real estate tbank building. No. 225 East
Forlyhith street, No. 10 President street. Brooklyn,
and No ~ President street, Brooglynour pieces all
they had In 1874 OF bonas Aabamas Sl65 900; North
Carolina, $ll3bO0; nil the Ten nesscc bonds been
sold; the rest oil the assets were Office fixtures and
about ~, 900 IN cash.
Mr. Daniel a. Moran the next witness lie
testified as foiows:-Am a broker by trade; the list
oil stocks presented In evidence affixed II their
market values; this was generally the bidding price;
the difference between the buying and selling price
ranges from ono TO i've per cent.
Mr. william J. Best was again called Ho d.
reced 10 look ~ minute OF the meeting OF directors,
April ID, ls14 Mr.. Chapman objected. suppose"
said he, that there should be paper put away in
one or the pigeon holes showing the hopeless insoi-
vency Of the bank is the Bank superintendent blame
able II ho should not hnd that paperY' Mr.. McKeon
offered tho minutes IN evidence. Mr. Chapman made
proposition That himself aud Mr.. Mckcon should be
allowed to examine all the minutes OF the bank and
takes notes VI what they wanted having them read
some other time. This was agreed to. MIR. Chapman
ready an adjournment would be necessary 1t was