Evening star. [volume] (Washington, D.C.) 1854-1972, 1899-07-15

4 X
Some OF the stockholders of the def,Inct
bank offered in alright to quit their claims
10 their holdings to any one who would as
sumo the liability of assessment. They
We're the same ones who had disclosed an
alarming symptom of the banks condition
on the week before by Offering their high
priced stock as far below par as 90 They
| had no takers.
| Hampered by Circumstances
The earliest report on the condition OF
the bank, made by the receiver Col Hum
| ungton w. jackson, showed that the nou-
| NAL assets were about 81 500 oeo and the
debts We're nearly sl.0o0.ooo. leaving a NOM
| MAJ SSOo.OeO to pay the stock liability of
sIooooo. on paper this looked most en-
[ couFaSing, but a close examipa ton showed
| thaI many OF the loans OF the bank made
| IN nush times, were secured by rollaterals
| % % uncertain value and real estate sched-
| uieu AT Doom prices and taken as the only
available payment for money loaned There
| was too much SLOW" paper and not enough
| snort paper.
OF the real estate one tract of a hundred
| acres lay on barren sand ridge near the
| lake shore and nearly ten miles southeast
| OF the city hail. in wholly unsettled part
| OF a suburb. Another tract of forty-fiye
| acres was nearly as far to the west of the
/ city on the bare fiat prairie, where there
| was Mite prospect of its ever being any
| thlng more than cabbage patch sin
| another piece of property lay far ont i'm
| the southwestern portion of the city. In a
| region as yet almost wholly undeveloped
| "
| Gept IN taxes and special assessments
| mere were score of other lots and parcels
| OF land, some in New York city and a great
quantity oil paper, much of it more or less
doubtful or wholly worthess-the Cats and
| dogs of defunct bank. In fact n seem
| ed TO some of the ninety stockholders that
| II would hardly pay the bank to retain its
/ property and meet the expenses OF man
| agement.
But the receiver was man of wide re-
sources and Astounding faith. No one could
| foresee the growth Of Chicago, especially In
| the gloomy panic days OF the middle '1es
| ana yet there were many men in Chicago
| who had supreme confidence I'm the city and
ils future. The receiver was one of these.
| Received Several Dividends.
little more than three months after the
| closing of the bank-on January 81. 1875
| the depositors received a dividend of 40
| per cent. month later 10 per cent more
| was paid. all from the ready assets and
| cash of the bank. Before the close of 1879
| 30 per cent more had been distributed and
| teen the receiver began to reach the prop
| erty that had been marked doubtful By
| the process known as Squeezing" and the
| sacrifice of some of the choicer pieces OF
| real estate. he managed to nay two other
| dividends of per cent each before the
| close of 1881, thus returning to the de-
| pCsitors the face value of their claims A
| year later they received their interest i'm
| full and the stockholders We're left, nearly
| hVe years after the close of the bank with
| score of pieces of expensive real estate,
l n ost or which had comparatively little
present cash value. and quantity OF doubt
ful claims and costly lawsuits, the legacy
| of the panic.
| But Chicago was growing. The suburb in
| which the hundred-acre tract was located
| became a part of the city. A cable line
| reached down and almost touched il; an
| electric line dropped passengers immedi-
| ately in front Of it; elevated railroad
| approached it within half a dozen blocks.
| Early in the hineties the worlds fair found
| root in Jackson Park. which adjoined the
| tract Immediately on the north. city OF
| great hotels, apartment houses and resi-
4 dences sprang suddenly into existence
| around it, and Chicago was a metropolis
far out beyond the park.
| At the time of the banks failure Chicago
| had formidable rival in st. Louis. Its
| population scarcely exceeded 00000 and
| there was no reason for arguing that I'm
| twenty years time it would be the second
| city in the country, with a population OF
| more than 100000. And yet the men who
managed the affairs of the bank had the
| faith which builds cities and their real es-
1 tate appreciated in value on a scale COM
mensurate with the astonishing growth OF
| the city.
Increase in Value.
| In July. 1891. the receiver called the
| stockholders together and laid before them
an offer of 100000 for the despised 100
acres of land and the stockholders upon
mature deliberation rejected it, feel
| ing that 1t would be worth much more a
| few years later. If the offer had been ac-
| copied 1t would have paid of not only The
entire capital stock of $3.50, 600 but it would
nave lett a comfortable $50 900 10 be di-
vided among the stockholders for their ma
thence. In a manner hardly less remarkable
the forty-five-acre cabbage patch became
VaIuabie. Car lines passed it, the suburb of
oak Park, itself considerable city, grew
out around II, and every year has added
thousands of dollars to it's value
Under the receivers care the bank has
mar aIaaa.. In
unfortunate while ii was still in the hands
OF the directory. There were many fierce
lawsuits to be fought. and in nearly every
case the receiver has been successful en- re-
covering the losses of the bank one asset
marked doubtful" the bonds of an at-
sorbed railroad company, yielded more than
s 40 ~, at the close of case that went to
the Supreme Court of the United States.
wisconsin gas company after lying DOR
mant for nearly score of years. walked
up ana paid a large per cent of its worth
less" bonds.
still Paying Dividends.
And so it happened that in 1893 the re-
ceiver was able to pay dividend OF ten per
cent to the stockholders, and he followed
1t in 1895 with second dividend OF five per
cent.
When the receiver had finished the pay
ment Of the liabilities of the bank the law
required him to resign in favor of an agent
who should dispose of the remaining assets
Oh the bank and divide the proceeds among
the stockholders
But the stockholders had other ideas.
They had confidence in the receiver and
they wanted him retained in the manage
ment of the business with which he VS.
now so familiar. Besides an agent might
entangle the title of the property A COM
mittee appointed by the stockholders an
peand before Congress during President
Harrison's administration and succeeded I'm
getting the banking law changed so that
the receiver could continue to manage the
affairs of the bank subject to the will Of
the stockholders
And thus by combination of good for
tune. shrewd management and patience the
Third National Bank now presents the spec
tacle. probably unequaled in finance, of a
business institution for twenty years de-
funct and yet paying dividends on stock
worth nearly twice its par value.