The San Francisco call., 1895-12-15
.DEPOS|TORS MUST WAIT.
The Grangers' Bank Directors
Decide Not to Open Its
Doors Again.
WILL 60 INTO LIQUIDATION.
The Bank Commission to Be Asked to
Take Charge To-Morrow-The
Cause of Failure.
WILL GO INTO LIQUIDATION.

The Grangers' Bank will not open its
doors tomorrow. 1t has gone out OF ousl-
ness for good and all, and the directors
will make a report Monday morning 10
the Bank Commissioners and ask that
body to supervise the liquidation. Ihls
course was determined on at meeting OF
the directors held yesterday afternoon.
The question of raising enough money 10
reopen the banks doors tomorrow ana
pay off the depositors was considered.
There was no doubt that this could be
done, but only at a sacrifice OF securiues.
The assets consist of moneys due the bank
on mortgages and other securities whlch
are not Immediately available.
The amount due to depositors is about
$4,000. No single deposit amounts to
more than $4,000.
E.J. Pillsbury, one of the directors and
the attorney for the bank, said last even
ing: 1--WE hope in three months or 30 TO
pay all obligations.
1.-THE bank Will probably go into liquida-
ton under the direction of the Bank Com
missioners. This is the least expensive
way, because the directors remain in
charge of affairs, subject simply to the su-
pervision of the Commissioners, who have
power to regulate expenses. In this way
all litigation and complications are
avoided"
A rumor passed freely among the men
on Change yesterday that the Changers
Bank had been forced into its present posi-
:ion by heavy operator in grain. AS the
story went the bank could not easily meet
Indebtedness pressed by this wheat mag
nate without hurting itself to some ex-
tent, and this dilemma confronting the man
ayers impelled them to retire rather than
struggle on against possible difficulties. 1t
was also said that George w. McNear
could explain the complications that had
arisen in the Grangers' institution.
| George w. McNear Jr. said he was not
aware OF the fact that any grain merchant
had pressed the bank. $50 far as our
house is concerned" he continued 1--WE
have done all we could to urge the Grang-
ers' Bank to continue in business. We
tried n every way to help the institution
keep up, for there was really no need of
the banks dissolution. To be sure, the
| past year was not very prosperous one
for heat-growers. The crop in the valley
| was short and prices were low. So in
many cases the sums advanced by the
| Changers Bank on wheat crops turned out
| to be more than was actually realized
! from the sale of the wheat. Possibly this
may have frightened the bank directors
from continuing the fight. But as is
| pretty well understood, they ought to have
! bank exceed the liabilities, and the bank
had nice business of its own.
II don't suppose that the suspension of
the bank will affect the farmers very ma
terially. When the time comes for SOW
ing, somebody, whoever is most directly
interested, will scratch up monev to buy
the seed and till the soil, and in that way
new crops will be planted. The savings
banks and commercial banks VIII be
called into req1isition to continte the
operations of the Grangers' Bank. 1t is
| the general opinion OF grain merchants
| that the Grangers' Bank could have,
and indeed should have, remained in
business
The Grangers' Bank of California was
founded at the time of the granger move
ment in California when oranges were
established, a grangers' insurance COM
pany and grangers' business associations
formed in the early seventies. Among
the founders were leading farmers from
all over the State, including A. D. Logan
of Colusa, l. G. Steele of San Luis Obispo
and Thomas McCalla of Sacramento.
The bank was Tor time comparatively
prosperous, paid regular dividends and did
a very good business. But five or six
years ago the manager extended the scope
of the banks business which had been
simply to loan money on grain in ware
houses. Atthat time money was plentiful,
and there was good deal of competition
in the business of advancing money on
grain in warehouses. Mr.. Montpelier
built a line of twenty or twenty five ware
houses in the San Joaquin Valley at
Merced, Fresno, Tulare and other points
along the railroad. Then in order to get
the grain into those warehouses he began
to advance money on mortgages on grow
ing crops. This was where the trouble
came in, for with failing crops and the
falling prices of wheat the bank began to
make losses. Another source of loss was
in loaning on low margins and refraining
from forcing the farmers to make good the
acro S2Q 900 S1Q QQQ Lost