The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1896-12-22


CHICAGO. Dec. a.-The National bank
OF Illinois. generally considered one OF the
strongest financial institutions II the
West. closed as doors today. the failure
dragging down three other concerns, Il. ).
Dreyer 4 Co, WSsmaaSaorff. HelnemAa
q Co. and the Roseaand bank.
The failure Of the National bank OF Tlii-
nois was due tc the fact that It's entire
capital Of s. ea0ae and sise 90 over and
above its surplus CT sSea0ts. had been loan
ed on Calumet Electric stocks. Five hun
dred thousand dollars was ioaned - Drey-
er & Co, who had spread their capital Oh.
so extensively that they were unable 20
concentrate Il in time 70 save themselves.
The other failures were due 10 locking Dp
OF assets held by the National bank OF I'LL
nois. which were not available when the
institution closed rs doors
No further trouhle is expected. as the
Clearing House Association has agreed 20
pay - per cent. o. the deposits IN the Ma
tional bank OF Illinois. and AZ the meet
ing of the clearing house committee al the
banks reported themselves in good oondl-
ton, and none OF them asked for the aid
that wound have been freely extended had
II been asked
Il Is probable all the banks Will resume
with the exception OF the National Bank
OF Illinois, and all depos.tors VIII be paid
in fu.i.
Clearing Housc to the Rescue.
WASHINGTON. Dec. Zl.-Comptrolier
Eckels has received an announcement
concerning the National Bank % Illinois.
Il says the Chicago clearing house eas as
Sumed 10 pay IS per cent. on al proved
claims John G. Mexican has been a.
pointed receiver and instructed 10 publish
list of al approved claims at once. 50
shat creditors may get the henehI OF this
acton. Instructions have been issued 10
all banks having the bank as a CORES
pondent to prove their claims and send
them in. AT the last report November 80.
the bank had capital OF sl.eo@ 900; undi-
yided profits. $3.50 coo. total assets includ-
ing bonds. sl5.0+s. sa2 The Liabilities wi,
be about 81. .0oo.090. While !t is feared Sc
rsous results may follow. Comptroller Eek
eis VIII do all in bis power TO relieve the
strain on the dependent banks and avert
any unnecessary panic.
The comptroller today gave out the fol-
lowing statement concerning the failure:
II am advised by Bank Examiner Nc
Kean that the National Bank OF Illinois
has closed. and is now In his hands for
the comptroller of the currency. In order
"a y,ras,enr my trouble q, Y,rns,fnc .Ia ty,,.s
against this bank. and TO obtain for cred
itors at an early date the largest part 0f
Inc amount Que 70 them. L nave appointed
Mr.. Mexican temporary receiver. with
telegraphic instructions TO publish no.
tice OF proof OF all claims at once. The
clearing house committee Of Chicago has
advised me that the examiner OF the clear
ing house VIII Immediately advance IS
per cent. Of the face OF the approved
bank immediate relief. and prevent any
unnecessary disturbance OF their business.
Il also direct the receiver. while secur-
ing all loans OF doubtful character. 10
hsa sSf = "a n
work any hardship upon the business In
terests OF those dealing with the bank ard
depending upon II. TIE advance naade oy
is not I'm payment for such claims IN ful,
bat s!mly loan OF such amount, with GER
tsficates as collateral security.
Failure Due to Gross Negligence.
s~T,he failure OF the bank is due 20 the
injurious. reckless and imprudeDt methods
followed by the officers and not checked
by the directors. though their attention
had been Individually called TO the same.
and over their individual signatures they
had promised 10 remedy the weak points
In the banks condition. The largest
source Of failure Is the banks holdings
Of the Calumet Electric Street railway
stock. the full amount or which cannot
now be stated. as II is discovered that
part Of such holdings was not made 30
appear on the books bat was concealed
in another account This and other large
and doubtful loans. had been called, ~
special letter 60 the attention Of the off,
~ y
n.ent was promised a year since.
In June last or the surface, there had
been an Improvement made, buf wHen
Bank Examiner Mckeaa on November 81,
books showed the loan to the Calumet
Electric Company and other similar loans
had been increased ana taat the pFoisalses p5
OF the officers and directors had not been
carried out Upon this report a letter adj
ar. ssed 10 the president and directors was
sent by the examiner On December u. %
Il a r4rfa~ 30 u
This letter reviewed az ignZt5 the cuEd&-
ton OF the bank and the failure 10 f0isisl
promises made. II emphasized the posi-
ton taken by the ofi3cers. stated thsf =
radical change had 20 b. a. once made. and
notified the directors. with falI and com
pete analysis on the part o. the exam
frer of matters In the bank demanding
( ..sstnreiay received a notice from ths
examiner that the rsfrn0Fs of the bS8k =
( condition aad reached tne clearing house
+ corn missioner and that they desired 20
have his report read - Them I ordered u
TO be done. bat suggested That of-fofe GO
7 ing 80 he see she officers or tbe National
Rank % Illinois. and obtain thcir acqni-
1 Ascence. This was cntain@a and the vice
president OF The bank presented = 70 the
& clearing house eommit tfee- Efe condition
{ revealed led 20 a resolution suspena}ng
/ tha bank from the clearing house Before
+ action was taken. however. the exa miner :
: fal39ra phesI me ard tn reply 1 s5sggest "a
( that IN views Of taking scme chances. ire
4 funds might ne provided II Sc NH& dee med
( safe 20 d -, 20 sff0FG N0iMnfsFF ta@iaa-
+ ffrr, The assets Of tire bank were ~xaua-
E 8rea and its mana cement. a. SHOWN Dy
the examiner. we're considered, aa9 as 3
+ conclusion II was decided that the ban x
( sfvould - suspended from fhe clearing
( h0t5aa and funds 10 noi furnished Tor Eo3-
t,Ysfary uuufdar3on. Three Of tr@ Dank s
I directors were present at those 1neet3 3n&s-
/ ola vsex of everything I STA convinced
I shaf th< clearing house coIruift.e ac-te
( ftlalrsons5v. The management on fh@ Tssrl
{ ~ fha a~trerw amf+ directors have. - stRte
/ b mildly been grossly neg ligent The l.R-
E ssl9fSss az IRE hank are large but by care
f.f ard iud8rtoHs management tns loss
+ snfasEnS On creditors need not ue large i
Z amw Every measure viii 20 taken ~ the
+ sfssrtuz house and controllers office 20
s fsFavaut other bank or business failures,
Z ana an i4stren @ssary money strfUE~f3rT.
Afreadv 81 outside hanks having fhs Ma.
tio-fsf park 81 Illinois as a reserve agent
rave beer notified sy telegraph % tie 3
rer cent arrangement.
A