Evening star. [volume] (Washington, D.C.) 1854-1972, 1878-10-31
TWO CITY BANKS CLOSED.
THE GERMAN AMERICAN NATION
al BANK AND THE GERMAN
AMERICAN SWINGS BANK.
DepGsit0rS Locking After Their Money.
What is Said About the Failures.

What is Said About the Failures.
The officers of the German American National
Bank, in consequence OF heavy drafts being
presented reducing the amount of cash on
hand, and some OF their securities not having
realized the amount expected, yesterday after
noon requested the Comptroller of the Treasury
to take charge OF the bank. This morning Mr..
b. q. Keyser, one OF the Treasury examines,
appeared at the banking house, corner of 7th
and streets, and took charge, and he is to-day
making an examination. At an early hour this
morning numbers OF depoSitorS and other per-
sons holding checks, appeared at the bank, but
found the doors closed. Around the doors OF
German AmeSican Savings Bank, tthe next door
on Fstreet), hundreds OF people gathered only
to find placard which informed them that
mer American National Bank this bank IS
clOsed.n The crowd was orderly, and the po-
lice had but little trouble to keep a passage
way open. Many seemed to be under the i'm
preston that at least the National Bank would
come out all right, While others insinuated that
only the small depositors would suffer, and
balances yesterday. The friends of the man
agement asserted that such statements were
false.
Mr. Keyser is busy this afternoon making the
examination Of the books of the National Bank.
He has no doubt but the depositorS will be paid
in full, as the stockholders are responsible. and
they viii be called upon to make up any def
ciencieS.
CONSULTATION OF THE DIRECTORS YESTERDAY.
The failure, so far as the national bank Off
GERS are concered, did not come upon them like
"a fire bell in the night" Yesterday all the
directors were called together at the bank and
statement of its condition was then read to
them. The result of the meeting was that it
was deemed best to close the bank because
there were demands made upon it, which it was
known they could not meet without sacrificing
rSsetS under the hammer. which would not
bring the amount of the banks claim on the
mortgages
From the best information attainable the de-
post account aggregated about $685., 900. This
was, however distributed among quite num-
her OF depOStOrS, although there We're many
large individual deposit accounts. The banks
principal business was among the Germans OF
the city. and quite a number of German firms
kept their accounts with the national bank. 1t
does not appear that the savings bank, which
after all, was but a flyer TO the national bank.
engaged in many wildcat speculations. They
did invest, though some years ago, in real eS-
tate. and made loans thereon, and to-day tile
property upon which the liens are held would
not, under the hammer. make the bank whole.
II the national bank had done its own legiti-
mate business it would have been solvent to-
day, but the savings bank loans on real estate
which the law fOrbids a national bank to do.
was the cause of the trouble.
LAST STATEMENT OF THE BANK
On the 18th instant the national bank made
the following statement of the banks liabilities
and assets on the 1st to the Comptroller of the
Currency. The statement Is signed by Charles
+. PrentiSS cashier, and John HitZ r. 3. Dom
Alison and Christian Ruppert directors.
Resoulces:-Loans and discounts, S1S1 ,329.2S
Overdrafts S2SSO.59; Us. bonds to secure circu-
lation, $.O.OOOOO Us. bonds on hand. S5O. 90:
other stocks bonds and mortgages, $2,712 80:
due from reserve agents, $42. 1927; due from
other national banks. S2l2.04: due from state
banks and bankers, S1O,6l2. go; banking house
furniture and fixtures, S149.332 ST. current eX-
penSeS and taxes paid, S,.663.1 Is: premium paid
81, 6,C00O 90; checks and other cash items s1221S 3S
exchanges for clearing house. 81 800 90; bills of
other banks, Ss415; specie, viz, gold and silver
coin s69 50; legal-tender notes. s3+, +,095.OO; L.
5. certificates OF deposit for legal-tender notes
s. '50O0; Us. taxes in litigation 8, ,l0 .O2-tota
SJ3I ,91I.02.
Liabilities.-Capitol stock paid in. $3.50, 900 oo
surplus fund, $2.oe0.o0; undivided profits
$s.535.55; circulating notes received from CONN.,
trOller, S6:, CO. individual deposits subject TO
check, 500. .G1: demand certificates of depoS-
it, $l5,93255; certified checks, Sll6l,I9; due to
other national banks, So 3o02I; due 10 state
banks and bankers. Si.i59. l9-total S53I. 81. G2
AN INTERVIEW WITH THE GOVERNMENT EXAM
NER-THE DEPREsSIOH IN REAL ESTATE THE
CAUSE OF THE FAILURE.
reporter of THE STAR to-day called lDon
MI. keySer, the representative Of the govern
ment i'll charge of the German National Bank a
examiner; and asked 'what is the immediat
cause OF this failure or suspension?
Mr.. kcyser:-Well. sir. it arises from number
OF causes. The bank to-day. if left to work out
its own salvation. could, in due course of time
pay dollar for dollar. 1t invested its surplus de-
pOSltS in real estate in the District. These in
vestments were made from time to time when
real estate was much higher in this market than
q.
very valuable assets, but are not available
You can readily appreciate what mean. If you
had mortgage On valuable property which fell
due and the mortgage paid the interest
you would not care TO press payment with a de-
pressed market when you knew in the end YOU
were thoroughly secure. Well, the savings
bank is just in this position. 1t has loaned its
surplus assets On real estate in this District
such loans are good enough, but they cannot b,
made available. The bank has been pressed for
a good deal of ready cash by it's depOsitOrs
hand
tect its creditors there were but two courses to
pursue. Either force sale OF its realty invest
mentS at great sacrifice or suspend. The Off
GERS OF the bank in the interest of its creditors
thought best to suspend. ! think the bank Will
pay its depOSitcrS dollar for dollar. or at the
very least am confident it will pay 10 cents on
the dollar.
THE CASHIER OF THE NATIONAL BANK.
Mr.. C. +. PlentisS. was present during the inter
view. He conceded with Bank Examiner
ISil. hf{ser that all the creditors would be paid in
Sta':-What line OF deposits had youe Were
lhere many small accounts or was your busi-
ness confined to few with large accounts?
Cdshier:-"Ne did quite an extensive business
We had a line Of depoSitors who did a heavy
deposit business with us, but still we had quite
large number of small depOsitors."
THE FACT AS TO THE FAILURES
OF the TWO concerns boiled down seems TO III,
about this: The savings bank did all of the in
NeStment OF money in real estate. 1t made its
investments when property was at its flood tide
VI Ndiue lie NATIONAL BANK ntlpeQ them out.
Practically both concerns are one, for the stock
holders OF the bank were the Deneficiaries OF
Inc savings bank. The law fOrbds National
Bank to invest in realty. The savings bank
seems TO have been organized as helper to the
bank, to enable its officers through the savings
Dank TO make such investments as it could and
make as national bank. Real estate was
bought at current prices, and when demands
were made by creditors OF either concerns the
Cne helped the other out. The national bank
helped the savings bank until it had to Stop 10
protect itself, and the pressure being Continued
upon both, they both collapsed.
NIX. NATTINGLY, THE SECRETARY OF THE SAVINGS
BANK,
states that in his opinion the suspension is due
III measure to the Shrinkage in real estate:
mat the building in which it is located {the Fed
eral buildtngS) was purchased when property
was up. and has cost them about $2O0O and
that of late it has not been paying. He has no
doubt but that the depOsitOrS will all be paid
and Is OF the opinion that the savings bank is
all right.
SOME OF THE LOSERS.
Au0iph CluSS, thearchitect, loses s, ,050 by the
failure. jerry the Presidents coachman,
lost his little savings $3.50. The bank was the
agent OF the Germana Life Insurance Company
OF New York; the company will lose heavily. il
Is thonght-abOut $40, 900 or So, 5000.
The bank has paid no dividend for the past Is
months. The stockholders are personally liza
Die for the amount of their shares.
The statements made to the board OF direc-
tors usually showed balance on deposit, run
WIZ De seen that the bank was doing large