The morning news. [volume] (Savannah, Ga.) 1887-1900, 1899-07-16
ROMANCE IN BANKING.
srnANGE STONY OF 4 s.ENII THAT
FAILED AND YJCC PAID IT'S DEBTS.

,iopnI Uank of Chicago and Made
millions Ont of Apparently Worth
less Properties.
Cd.aeo, July M.-More than twenty
vers ago the Third National Bank of
Chicago formally closed its doors and a
receiver was appointed to satisfy the
cl,morioc deposIors. Some of the stock
holders feared an immediate assessment
rar the payment of liabilities and offered
+, give their stock to anyone who would
assume its obligations To-day this stock
Is held at nearly double its par value; and
r. is REGARDED as "gilt-edged" security
Within five years, although the bank has
received no deposits, made no loans, issued
no currency, sold no drafts, it has paid
TWO substantial dividends to its stock
holders and promises many more. The
very name of the bank has been forgotten
EXCEPT a few gray-headed men who are
personally interested in its affairs, but it
is even YET an important financial institu-
ton with its regular stockholders meet
tnes. its taxes, its law suits, lis reports
and It's bookkeeping. Moreover, it is
uniaue IN being corporation having large
assets and no liabiliues-beyond the obi
cation to It's stockholders All of the en-
tries. except drbiets of expense, appear on
The credit side of the ledger.
The circumstances which led up to these
peculiar even unprecedented conditions,
make a story probably without parallel
in Inc annals of national banking
Prior 10 the panic of 1873 the Third Ma
uouai Bank ranked as one of The stanch-
est financial institutions in the West. 1t
had a capitalization OF $4,000 aud its d.
rectory included some of the most promi-
nanl names in Chicago-such men as
George N. Pullman, J. Irving Pearce, JOS
cna MediN G. IL. Curtis, c. M. Hender-
son. C. X. steele, John Fl. Thompson, Viii
liam e. Alien and S. S. Benjamin. Only
oue bank IN its home city exceeded 1t in
the extent and importance of its bust
ness.
When the financial crisis of 1873 was at
its hight the Third National Bank sus-
pended payment for a single week as a
pIecauuon against a threatened run.
4 Wnan !. opened again and prepared 10
/ resume its old place in the business world
But a bank is like q man. 1t is trusted
implicitly until il reveals some inherent
weakness. After that its business friends
watch il keenly and approve its methods
with au IF and its business enemies
await the strain which again shall test its
strength.
-He lNIQ NblAOtlai Ddilh lldU the lltlGSl
Offices ia Chicago, the largest force of
Clerks. the longest list of country CORE
spouden,s but it also had the single slip
from the path of financial rectitude to live
away Some of its officers, knowing the
need Of unusual efforts to maintain its
business supremacy, signed the bonds of
the treasurer of Cook county, thereby re-
c5Hius large deposits of the public mon
ey 70 swell the quarterly reports. The bank
1850 appeared as The main depository of
a board of park commissioners of which
il2 PRESIDENT had become the treasurer.
Other bankers, boxing on, saw the signs
aud understood them
In 1873 the deposits exceeded 81, 100000
but In spite OF all the bank could do,
they kept creeping down and down until
late in 1871 they were only s1,14,000. Dur
ing most of this time the bank officers
We're hfmIy optimistic; they believed in
the soIidily and business worth of their
bank
In September 1877. an extensive hotel
property owned by President Pearce and
one OF the other directors was destroyed
10y hfe. Ii had no connection with the
udhk, and yet the bank felt the shock.
A lew weeks later President Pearce call
"a on the New York correspondent of his
paAK ana asked for a temporary loan to
~ used in case the heavy deposits of
PUBIC money should be Withdrawn sud
Ae"sec. If il were not for the large de-
mahas now being made as an incident
" tAe ndrd times, and the uncertainty
=, tAe money market-and other circum-
stances that assist a bank president who
DoeS NOT wish 10 loan money-they might
FYs9lgy spare a few hundred thousands.
va resident Pearce's return to Chicago
~ toond chat some of the directors of
'e oanA had been touched with the grow
aug "islfust They were losing confidence
~. inc ability of their own bank to meet
r' mands which might be made upon
lAey had kept the feeling to them
Fes' ana yet, after the manner of such
,..7S' 1T was all down the street in a
7e o1y, travelling by such secret ways
d" oH-F an eva rumor knows
~ spite OF the loss of confidence there
as TO regular run on the bank. It's
,ss was conducted by the usual num-
- Clerks and its mail had not dimin-
IL was buoyed up and supported
i "' O putation of substantial prosper
E aNd dignity which il had known in
past and yea it was suffering from
o,s,s."s disease known to fnanciers as a
ro'' pocket run" Depositors came smil-
v ana drew out their money and it
mn. "ol replaced. A St Louis paper
sa O brief telegram limiting at the
oIot on Of the bank. and the country cor
p.ei5r. iss always ready with their sus-
arj o,' "esan to fear for their balances.
Ia very mail brought drafts that helped
'"A the banks reserve.
Chez" can fordfy Itself against the ex-
ul Of regular run and fall. strug-
II IL I5' '.' some of the hOnors of war. but
m.s.i,. ." protection against the creeping
ais ~ 'nese quiet friendly withdraw
anl eau, 'tllhg day after day for weeks,
the 41,,l of them an insidous thrust at
'aoks stability.
tae tl., 'He county treasurer gave no.
yary He would want 100000. He was
c, 'eahle about it and he had his
TO. ts5 I't he must have the money He
Do.e., msarl the rumors and he must
o, million dollars is very large
uhas's money 10 ask instantly from any
UTarI N,.IN cash. The officers of the
H.. 1e- toHal Bank ran here and there
uher IL merely spreading the odium of
earing as The First National Bank
IN la15 General financial disaster, agreed
iona. 1elping hand if the Union Ma
r1o6 2 Tl.ik would do the same. The
ara d..ao1aI Bank, after questioning