New-York tribune., 1895-12-07
SUPERINTENDENT PRESTON'S OFFENCE.
HIS ACCOUNT OF his DEALINGS WITH THE COM
MERCIAL BANK or BROOKLYN.

Albany. Dec. G-The reply Of Charles A. Preston.
state superintendent OF Banks to the charges pre-
ferred against him by &. Augustus Havand, acting
for the depositors organization OF the Commercial
Bank Of Brooklyn. made public to-day. 1t Is
directed to the Governor and the substance Of 1t
is contained In the part relating the third charge,
which That Lawrence +. Cahlll a bank
examiner, in his official capacity examined the said
Commercial Bank in the years 1880 and 1891. and in
both years fled official reports In said department
showing the said Commercial Bank TO be nsolvent
Mr. Preston says:
Commercial Bank OF Brooklyn suspended payment
and closed its doors has that bank been unable to
various examinations and reports made TO TINS ue-
partment The first examination OF said bank aiter
| became Superintendent OF Banks which was made
on June 80 1890 showed the bank to have Giean
including its capital stock
The next examination was special one made li,
December .. 1890 the time OF the panic OF tnat
year. and disclosed the fact that after dsa.lowins
the entire amount of past-due paper, amounting 10
paipHen % OF ins ts eSpa "a the AMOUNT Of sio3o 81
As soon as the report Of this eXanInaton ij Was ie
order to the officers Of the Co'nmerciai iank ~
Brooklyn, requiring that this impairment be maze
Within three days from the time of making this
Iequisuon there Mas pa.d into ne Damh IN ctSn IN
Sl,2Si ~. and within sixty days after mafihs uaS
eGason there was PAID IN Il, i9e e, M % Of Which
No. s rs5 wiibjr sixty LAYS rom the pastdue
paper which had been dsdllOWed in the eXamina-
examination the examiner going there as often as
aTunlant,y satisfied that the impairment had been
made good ana taat the baak was IN the possession
Of substantial surplus OF hot .ess thdh @-'Vy0' o''
al. IT, obligations. including us capita. - -,
The next regular examination was made on sep
mated by the examiner, Mr. Cahil that Si5''a a., ~
Of the paper OF the oaiN wa 9i,a, td I'm, me
worthless ana that amount was deducted rom .''o
bls or notes discounted. After making this deduc-
lion and Naluing thc banking house and lot. which
ffffiaf
poared that the bank had impairment OF S5ll1 -
i-nor the RECENT of the report OF the examiner
| personally ezalnincd each promissory note when
had been dsal!owed by the examiner, aHI Ieaiil,I M
rom what was regarded reliable sources that the
real es,ate. which the examiner had allowed It
Si10o1 was worth $4,000. and that tne bank had
received at Least three offers OF >looyO Tor me
property. In revaluing the assets a. tGat NH1c
cons-nted that the valuation 81 te -, a. 0ss
Within thre- days from the date OF the ehai@Illna NINA
tion Of september 10 there Was palq Hito ''i, ~ ~,
take up paper which had been disaloWed py M
examiner a. doubtful and worthless, ana "1t. ,bnre
sixty days from the date or the eNaiildoIo.
had been paid in S23o9S ss from the saIne soutCe;
that. instead Of the bank beng ifhpdT&t. & than
Is capital intact and a surplus OF no. 10 W
$500 within three days from tne Ga{g 81 .e d,Vs
animation Of september lo ana wi'm nm IN inSudi8g
a surplus OF $1,000 over all It's oohgauo"S 1"'''''7
capital stock ,, s,,h
nlitted bv Mi Hav.and that debts tnat were pas
due for ten years were put down as good in the
oir various examinations OF this bank all past-due
paper was disallowed except as was proven ~ " tIc
question: thai the ~. Kevin Mining company
paper was never counted good by the Depar m Siisl ~
except the extent OF its collateral 70 VII $50 ~
which collateral has been fully teiNzed Stree tIle
hank closed its doors The loan OF Paul C. Grthlhs
amounting 10 d little over $22.ro. ana when III oI'
examinations was estimated 70 be amply secured
has been paid As | informed by the receiver, 10
the extent OF $4,000 leaving very sma'I DalaISI.
of the total amount which the receiver NCiuhtdrHy
deducted IN the settlement. as ! underStand'
These TWO loans constituted what was known as
the large loans Of the bank The other unina tured
loans were made. | remember, IN thr usual way
and for ordinary amounts. which would not eNcits
suspicion on the part OF the Department IN the eN
animation Of them but ii seems that In the WIND
ing Dbl, of the bank by receiver there mas D-rn
qi.tt a. percentage Of the unmatured loans Whlcn
AZ the time Of our examinations were representel
10 us 10 BE- good and 80 far as We could determine
from inspection otherwise. were good) out Whlch
have turned out be uncOectibe since the failure
OF the bark. The receiver as am informed, has
paid SS per Of the deposits 10 the dep0sltor-
and has a considerable sum OF money IN mana attr'
deIucting the expenses of the receivershp TO apply
on the balance OF the deposits l va informed
some time ago that there would be suficlent iundS
realized to pay the depositorS in full but IN con-
vers4tOn with the receiver OF the bank Ne5teriay'
ha Informed me that there viii be a small denclt.
desire 70 say IN conclusion that IL has been
the policy OF the Department during my adminstra-
tton 10 build up the banking institutions OF the
state rather than destroy them. but nave never
he-ltated TO close bank when J believed that the
Interests @ all parties concerned required 4.