Jamestown weekly alert. [volume] (Jamestown, Stutsman County, D.T. [N.D.]) 1882-1925, 1894-02-01
The LAMOURE BANK,
intentionally Wrecked, Says
the State Bank Examiner,
in His Report.
A Grave Oftense of Which the
Law Should Take Due
Notice.
An Outsiders Opinion of the
LlOydS' jamestown
Organ.

State Examiner Peabody OF North Da-
kota has made his annual report for the
year ending Oct. 81. last. to the governor.
On the subject of state banks, he says:
There are seventy-four banks in the
state, organized and doing business
under the state banking law, having
combined authorized capital of 81, $4,000.
There have been two failures. Lloyds,
Bankers, of LaMoure, having capital
Of $4,000 and deposits aggregating
S569l39S, failed July 10. 1893. The
total liabilities OF this institution is
shown by the amount of deposits and
Sl4l.S9 due the Lloyd's National bank of
jamestown. Their assets are represented
by notes, SS4,532.3S, fifty shares of capital
stock IN the Lloyds National of James
town, $4,000 and warrants, S55.44. l find
that this certificate of stock in the
Lloyds National of jamestown, was an
parertly purchased from Jas. NJ. Lloyd
or July Sth, 1898. T also find that on
the same date Lloyds bankers discounted
Jas. NJ. Lloyd's personal note for $3.50,
also on April 20, 1898, Jas. NJ. Loyds
note was discounted by this institution
for $500, making in all $3.50, without
any security whatever. And from June
8, 1893, to July s, 1893, this institution
discounted four notes of W. Nj. Lloyd,
aggregatlng $3.50. And from February
>, 1898, to July 7. 1893, notes of H. L.
Lloyd, the cashier Of this institution
were discounted by himself, to the
amount Of Sl,747.42, making a total of
5l4, 241.4 40, drawn out of this institution
within very short period of time, and
with no security OF any kind, excepting
the fifty shares of stock in the Lloyds
National of jamestown, and it occurs to
me, that, under the present existing cir
cumstance, these shares OF stock are Sc
curity for the creditors of Lloyds Ma
tional bank, rather than the LaMoure
bank, for it is pretty generally known
that the Lloyds National bank will not
OCpOSlIO1o III lulJ. duu 6IuCo Guc
LaMoure bank is at present stock
holder in the jamestown bank, will not
they be assessed with other stockholders
to meet the deficiency? This feature of
the transaction probably did not occur
to the officers of the LaMoure bank at
the time they purchased this stock, but
thirrp hov haop <<,
them, viz: that it was questionable Sc
curity, not only as to value, but also as
to the time OF realizing on such invest
ments, had the Lloyds National remained
solvent. And the fact that the cashier
of this institution discounted his own
notes to the amount of $l,747.42 and
those OF his brothers for $500 with no
security whatever, together with the fifty
shares Of stock before mentioned, there
by premedltatedly wreckiug the institu-
tion, OF which he was manager, is in my
opinion very grave offence, and one, Of,
which, the laws of our state should take
cognizance. Q shall refer to this subject
in the amendments to our banking law IN
my biennial report
consider this a bad failure, not be-
cause OF any deficiency in the amount
and character OF the assets, but for the
reason that it was brought about un-
necessarily. l do not believe that the
stringency in the money market had
anything to do with this failure, unless,
perhaps for the reason that this strin-
gency made It impossible for the officers
Of the institution to borrow money with
which to replace the funds they had
wrongfully withdrawn. I say wrong.
fully withdrawn, because it was taken in
direct disobedience to Sec 20 Of our state
banking law, which reads as follows:
Each association shall at all times have
on hand in available funds an amount
equal to 20 per cont Of it's deposits, one
half OF which may consist OF balances
due to the association from good, solvent
banks, and one, half shall consist Of cash
on hand; whenever the available fund
shall be below 20 per cent Of it's deposits,
such association shall not increase its
liabilities by making any new loans or
discounts, otherwise than by discountine
or purchasing bills Of exchange payable
at eight, nor make any dividends Of ito
profits until the required proportion be-
tween the aggregate amount Of deposits
and its lawful money reserve has been
restored The weakness OF this clause
is apparent, from the fact that no penalty
attaches.
BANK OF CARRINGTON.
The other failure referred to by the
exami ner is that OF the Bank of Caring