The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1896-12-21
CHICAGO BANK FAILS
National Bank of Illinois
Doors Closed By a
Clearing House
Committee.
BAD LOANS THE CAUSE
The Second Largest Bank in Chi
cago. and it Had Weathered
Many Financial Storms.
BAD LOANS THE CAUSE

CHICAGO, Dec. q, 1s96.-The National
Bank of Illinois. located at No. lis Dear
born street, one of the oldest and best
known banking institutions in the city.
with assets amounting to nearly $1,000, 900,
did not open its doors this morning.
This action WAS decided upon by the di-
rectors of the bank at six o'clock last
night, after the bank had been suspended
from the Clearing House Association of
Chicago at a meeting Of the Clearing
House Committee held at the home of Ell
bridge G. Keith.
The President of the bank, George
Schneider, is Treasurer of the Chicago
Associated Press.
The cause Of the suspension, as given
in the resolutions adopted by the Clear
ing House Conamittee, is ''Unwarrantable
and injudicious loans" through which
''the capital and surplus of said bank Is
seriously imperilled, if not absolutely
lest.
At the last statement of the bank It's
capital was shown to be S1,000,000, with a
surplus of 100000.
depositors viii suffer great loss by the
suspension, as the bankers who were pres
ent at the meeting of the committee have
recommended for consideration - pro-
justed claims against the National Bank
of Illinois. In addition 10 this they have
agreed to use their influence with all oth-
er members OF the Clearing House Asso-
citation to accept all such claims as coll
lateral at the same ratio.
The Clearing House Committee met
shortly after one O'Clock yesterday after
noon, and after discussion of the banks
affairs, at which every phase OF it's condi-s
tion was carefully gone over, the decision
Was reached that the institution should
be suspended from membership in the
Clearing House Association.
A statement was prepared and after
each member of the committee signed 1t,
it was given to the press representatives
for publication. 1t is as follows:-
Whereas. The attention of this commit
tee has been lately called TO the admins
tration of the affairs of the National
Bank of Illinois. and 1t now appears
through statements made TO this commit
tee by one of the Vice-Presfdents of
said bank and from the reports of the
National Bank Examiner that by reason
of unwarrantable and injudlcious loans
the capital and surplus Of said bank IS
seriously 'mperilled, If not entirely lost;
now, therefore
.sResolyed, That under the powers con-
ferred upon this committee by the by
laws of the Clearing House Association
Of Chicago. we do hereby suspend said
National Bank of Illinois from the priv
ileges of membership in said association,
to take effect Immediately;
Resolved, That the Secretary of this
committee be and is Hereby instructed
to send a copy of these resolutions to
each member of the association, and to
report the same at a general meeting of
the Association to be held on Monday,
December 81 at $3.50 P. NJ.
In taking this action the committee
deem it proper to say
81 That the cash resources of the bank
are within the requirement of the law,
and if as a result of this action said
bank should suspend payment and liqui-
DATE its liabilities a large and speedy
dividend will be made available to eredi-
tors.
% It is the declared opinion of the Off
GERS and directors of the bank that its
resources are ample to pay all OF its
liabilities in full 100 cents to the dollar.
and it is the opinion of this committee
that adjusted claims against said bank
may be considered ample collateral Sc
curity for loans at IS per centum of their
face value, and in event of liquidation
by said bank we will recommend TO the
associated banks an arrangement where
by such loans may be made available to
creditors of said bank as their convent
ence may require.
81. J. GAGE,
.sORSON SMITH,
&C. l.. BLAIR,
s'E. G. KEITH,
s'Clearing House Committee