New-York tribune., 1878-03-28
CONDITION OF THE BANK.

| CONDITION OF THE BANK.
| A DEFICIENCY ESTIMATED AT $50, ,425 25-NATURE
OF TIE IsvEsTME NTs-LossEs on REAL ESTATE
| ILLEGAL TRANsACTIONs-REPoRT OF THE EX-
| AMINERs.
| Iron REGULAR CORRESPONDENT OF THE TRIpUSEl
ALBANY March 27.-The Sixpenny Savings Bank
of New-York City has been closed by request Of
Superintendent Lamb, of the Banking Department
On March last, the superintendent instructed
Messrs A. B. Kirtland +. NJ. ST. John and John +.
| VI. McDonough to examine the bank The
| examiners finished their work on Friday last,
March %, and forwarded report showing the
condition of the bank. The report was not re-
ceived in Albany at the Office of the Bank Depart
ment until after the department Offices were closed
The following Monday, Mr.. Lamb sent the report to
| the Attorney-General. and requested him 10 begin
proceedings for closing the bank. The Attorney
! General appeared before Judge Westbrook yester-
day and applied for such an order. The Judge
granted the order; which was served upon the Off
GERS of the bank in NewYork this afternoon.
Below is the full report of the bank examiners
which caused the closing of the bank:
SEw.YoRK CITY. March 90. 1879.
The Hon HENRY l.. LAMB, letting Superintendent 81 me
Bank Department, Albany, N. Y.
SIR: Pursuant 20 your instructions. the undersigned
have examined the alrs OF the sxpenny Savings Bank
OF the City OF -Ycrk and herewith transmit report
| such
sequent days.
We found deficiency Of assets amounting TO the sum
of $50 i25 25 and deficiency in income amounting to
slOI4l %. We found bonds and mortgages held by the
,uk TO the amount Of SslT554 -. or this amount we
deem the collection OF $297 COS 20 full. doubtful
the security not beng sufficient and we have
therefore estimated = loss thereon amounting
deemed thus doubtful. there il one for $500:
Stas Government for Appraisers stores. This mortgage
Is Of Ave. upon the same property, amounting IN
recorded simultaneously. The mortgage IN qucs-
iion covers with land the fec to which was in
tho mortgasoF, SIX lots whlch he h.ld unue. , "a
lease, which by its terms Will expire IN MAY.
Loan s was bad may be saSeat. siiil we think the
bank acted unwisely a. well as Illegally IN making lhe
scarcely BE- called HrS mortgage as ths re are Tour
other loans the same premises entitled 10 equay
erty as large part OF the land Is held by no other ten
| urc than the lease above mentioned.
In January last the bank caused an appraisal 10 be
made 4 lts mortsagcd property Taking thai aPpra-a
A. basis, We found very many OF i's m9rieaSes es.e>
improved property and than 40 per cent OF the
value of the uuiinproyed property, covered 10y them
In several instances ud gng from reliable informatiOn
this also the case at the date of making the loan
on en,eSs % ne ISu in St ,sw "f the
officers the attorney having retained almost oil OF them
In h- office. We finally succeeded Ia obtaining abstracts
for half OF the mortgaged premises though not
| without much delay. Many OF those which We dld
obtain In TACT most OF tnen. incomplete and de
feciiye showing title to the mortgages in the bank
not properly certified and often showing plor mort.
| cages uncanceed On this count we found II dlifcut
! TO place proper valuation many Of the mortgages
examined by II often Impossible to say whether
moTgaee account OF the bak We have deducted - 800
having ascerthned that two mortsages amounting TO
that forclosed some time ago. aud the property
was bid Ia by the bank, though II was stu carried as
bonds aud mortgages This sum we cohsiuer soOu' anu
have added II 10 the real estate account.
| Loss on REAL ESTATE.
By far the greater portion Of tho real estate owned by
the bank unim proved. II acquired by the fore
closure Of mortgages, and on most OF H. Judging ifo'n
the hes, information We could obtain, the original loan
wa, quite The total cost OF this rca estate 10
| the bank was S99.576 os. Judging from recent ap-
prasas made by competent appraiser and from other
information, We estimate loss on this property Vi
The bank holds 3a5 shares OF Mercantile Trust Com
call your attention 10 this Investment, deem II 20
have made to the letter and spirit OF the
charter of this bank. Their other investment securities
| amounting TO s772 6Gs "a. seem TO have been wisely
well selected, and could II desired, be readily con-
amount Of ,7lo which are for the most part amply
amounting to the sum Of So sl4 80 and deposited in
banks and with bankers the sum OF S26sIO Is upon
that the bank could make some suitable arrangements
whereby ii might secure interest large amount OF
! available money.
| AMOUNT OF THE LIABILITIES.
The liabilities OF the bank 80 27l depositors amount
81 sos 269 II. There is also outstanding claim OF
| one Of the attorneys OF the bank, unquidated ana
| amounting TO S23Ol 50. We may mention TOO. con-
| the present banking house which lease will expire In
May 1ssO. We have not placed this IN the statement Oh
liabilities that portion Of the building now suoet Ny
the bank brings income OF about Sl2OoO year. lenN
Ig the occupied by the bank Itself at reusOhapo
rent OF about 81, 800 per annun.
| IRREGULAR AND ILLEGAL PRACTICES
We desire also 10 call your attention tosome other ir-
regular and Illegal prnctces In connection Win inc
business OF this bank We found mortgage loans made
by the bank to the wives OF Two OF the mo
would TO us, tue husbands are indirectly, III ho.
directly, interested. Two OF the attorneys oI
| the bank have loans secured by mor'sascs "poS S
which they are arrears OF interest trustee ana
officer has assigned q second mortgage 10 the panh "u
the bank on two occasions loaned money 10 pay on m
mortgages In which said truste and Onicer was III,
tcresed he having assumed the pay fnent OF one anu
owning the other the bank receiving tirom the party
whom IL advanced the money, two mortgages Oh INC
| same premises security for the loan
| The bank seems to have number OF customers VINO
keep active accounts upon which IL takes checks ana
for collection and pays cheeks on PIesen'aMtloa M
without the production OF the bank book ana u pays
interest the daily balances Ibere 10 iaibe
difference existing between the depost0rs iedgers anu
the general ledger, stated to be about Soooo;;
| This discrepancy has existed Tor many yehis' anu anu
an effort is now being made by the bank 10 pa'anve
department Because Of these irregularities anu Oh nc
count OF not having abstracts OF title 10 many o Tue
| lots upon which the bank held mortgages we "eto ~
obliged take the testimony OF severai W,inesses 10
cause searches 10 be made Ia the Registers onice anu
have considerable property appraised thus causing aa
| ditional expense and proODging the examination.
In conclusion, believe that there nave Decn weak
ness and the management OF this pank
amounting almost ~ Indifference III protecting anu h-
creasng tie funds conhdngy placed In It's keeplhg
by thai class Of people whose Interests should nave
especially guarded, ana whose weiiare IL s'oui" n"'o
| faithfully promoted. .
| All OF which Is respectfully submitted.
| ALBERT B. KIRTLASD, Examiner
| +. NJ. ST. JOHN, Examiner.