Perrysburg journal. (Perrysburg, Wood Co., O. [Ohio]) 186?-1965, 1900-01-19
A ROMANCE OF BANKING.
Rare Good Fortune of Chicago Stock-
holders Twenty Years After
Failure.

More than 60 years ago the Third
national bank of Chicago formally
closed it's doors and receiver was ap-
pointed to satisfy the depositors. Some
of the Stockholders feared an immedi-
ate nsscssmrmt FOR the payment of liza
bilities and oTcrcd to give their stocl,
to anyone who would assume its obl'7l-
tions. To-day this stock is held ut near
ly double its par value, and is re-
garded us gild-edgcd security. Within
five years. although thu banls has re-
ceived no deposits, made no loans, is
sued no currency, Old no drafts, 1t
has paid two di"1!ends to its stockhold-
ers and pre- rises many more. The
very ma, of tho bank has been for
gotten. except by n few gray-headed
men who are personally interested in
Its ufrairs Moreover, it is unique in
being u corporation having large assets
and no liabilities beyond the obligation
10 its stockholders.
The earliest report on the condition
of the bank, made by the receiver, Col.
Huntington w. jackson, showed that
the nominal assets were about $1,S00,-
900 and the debts were nearly $1,000
boo, leaving n nominal $S00,000 TO pay
the stock liability of $T5O,0c0. On paper
this looked most encouraging, but
close examination showed that many
OF the loans of the bank, made in flush
times, were secured by collaterals of
uncertain value, and real estate sched-
uled ut boom prices and taken us the
only available payment for money
loaned. There was too much "slow"
paper and not enough "short" paper.
OF the real estate, one tract of 100
ncres lay ON Il barren sand ridge near
the lake shore and nearly ten miles
southeast of the city hall, in wholly
unsettled part of suburb. Another
tract of 45 acres was nearly as far to
the west of the city on the bare fiat
prairie, where there was little prospect
Of its ever being anything more than
q cabbage plant. Still another piece of
property lay far out in the southwest
ern portion of the city, in region as
yet almost wholly undeveloped and
promising little immediate growth, ex-
cept in taxes and special assessments.
There was n score of other lots and
parcels of land, some in New York city,
and great quantity of paper, much of
It more or less doubtful or worthless.
In fact, it seemed to some of the 90
stockholders that it would hardly pay
the bank to retain its property and
meet the expenses of management.
By the process known as "squecZ-
ing" and the sacrifice of some of the
choicer pieces of real estate the re-
ceiver managed to pay before the close
of 1881 the depositors the face value
OF their claims. A year later they re-
ceived their interest in full, and the
stockholders were left, nearly five years
after the close of the bank, with q score
of pieces oc expensive real estate, n.osi
of which had comparatively little pres
ent cash value, and quantity of doubt
full claims and lawsuits, the legacy OF
the panic.
But Chicago was growing. The sub.
urb in which the hundred-acrc tract
was located became part of the city
A cable line reached down and almost
touched it; an electric line dropped
passengers Immediately in front of it;
an elevated railroad approached il
within half dozen blocks. Early IN
the nineties the worlds fair found roo
in Jackson park, which adioined Tho
tract Immediately on the north. A city
of great hotels, apartment houses ant
residences sprang suddenly into eX
istence around il, and Chicago was {
city far out beyond the park.
In July, 1901, the receiver called thu
stockholders together and laid befor,
them an offer of 100000 for the de
spised 100 acres of land, and the stock
holders, upon mature deliberation, re
jected it, feeling that it would be wortl
much more few years later. If fh
offer had been accepted it would bav
pIid of not only the entire capita
stock of $750,000, but it would have lef
O comfortable $250,000 to be divided
among the stockholders for their pa
tience. In n manner hardly less re
markable the 45-acre cabbage patch be
came valuable. Car lines passed it, tn
suburb of Oak Park, itself consider
able city, grew out around it, and ever
year has added thousands of dollar
to its value.
And so it happened that in 1893 tn
receiver was able to pay dividend @
ten per cent. to the stockholders, an
he followed ii in 1895 with second di,
idend of five per cent.
And thus, by combination of goo
fortune, shrewd management and pt
tience, the Third national bank no.
presents the spectacle, probably III
equalled in finance, of q business inst
tuition for 20 years defunct, and yt
paying dividends on stock wort h neal
ly twice it's par value.-Chicago Ever
inD News