The sun. [volume] (New York [N.Y.]) 1833-1916, 1900-01-14
STATE TRUST ALL RIGHT.

SlAIE IRUSI ALL RlGllI.
SUPT. KILBURN FINDS IT HiS A
SURPLUS or At LEAST SL,OOO,O0O.
Abram Killing. a Stakeholder, Petitioned
the Governor for an Inquiry, Alleging
Improper Lo%ans-supt. Kiiburn Says
the Loans Are Amply securod-President
Johnston Declares Killings Charges False.
The examination into the affairs OF the
State Trust Company Of 100 Broadway.
which has been conducted by Gen. Avery
D.. Andrews. who has Just resigned as
Adiutant General OF Gov. Roosevslt's stan.
has been completed. and Gen. Andrews turned
over his report yesterday to Frederic D.. Kill
burn. Superintendent Of the state Banking
Department for whom the investigation was
conducted. After examining the report Supt.
Kilburn wrote the following letter. which was
given out for publication:
walter =. JOhnston, E,q. Presid,n, he State Trust
CohpdRy:
DEAR SIB: In order that the public may get
no false impression as to the standing and he
affairs OF the state Trust Company, ! wish to
state that I ind Il in an entirely solvent cOndi-
ton, having a surplus OF Of least 81. 100. 900.
Very truly yours.
II appears that the attention OF the Banking
Department was called to the company by a
former director OF the American Surety Com
pany. Abram Killing. a stockholder in the trust
company. who sent to Gov. Roosevelt a sort Of
petition for an inquiry into the company's
affairs. This document gave a list o! certain
loans OF the company. as follows:
Daniel II, Shea. s., 900
Moore 4 Sehloy INSTRUMENTATION. 1000, 900
Anthony \. Brady .,..........".,.... $4,000
William Z sIeehan ,..".,". . ....... 4l?.soo
Metropolitan Traction Company ,..,". 100000
s5.l82.s 500
King went on to say that the S2.0O0.00O
loan to Shea was really to William c. Whitney
and his associates. several OF whom with him
are trustees Of the com pany an that this is
III violation OF law that the $1,000 o loan
was really to Whitney. and the Sheehan loan
really to Trustee Il. A.. C. Smith. King
asserts that the $4,000. 900 loan was made
IN violation also OF the prohibition against
lending, to. any one borrower more than
one,iltth OF the capital and surplus OF q
trust company unless the collateral Is worth
10 per cent. more thnn the amount OF the
loan. Ot the loan. 10 Louis i. Payn, State
surerintendent Of Insurance, king says that
the collateral ls unsuitable lndustriais with
what p%urports 70 be a bank check Tor SlOU. 200"
King also schedules some smaIierloans of the
company anu impugns the security.
As to suficiency u the collateral on the loans
Supt. kilburn makes the following statement;
II have examlucd into the history OF
~ the complain tor, petition made by
Mr.. Abram King, and am satisfied that
these loans are amply secured, Beyond
a representative OF a syndicate. in which
three Of the directors We're Interested
N.a nf ahant Nlnnnn a., Ian,
has adeposit with the Trust Company otobout
sl.oOO.QOO. which last loan has to-day been
reduced to the legal limit. | do not believe that
the nditio OF this com pany was ever better
than at present. The directors Interested in
the s?'OOo.OOO loan offered 10 pay 1t at once,
but at my suggestion the matter was lett until
the com pletlOn OF the examination Two OF
the three directors Interested in the syndicate
loan " -, 10 tell me that the interest Of
each OF the three in this loan - 500. 0OO, They
also stated that with this exception they never
borrowed directly or indirectly from the State
Walter s Johnston. President Of the Trust
Company gave out tho following statement
Now that the superintendent cr the Bank.
ing Department after full examination has dis.
posed OF the case anu finds but two techulcal
matters to %critlcIse, both Of which would have
been remedied to-day but for his request, It Is
proper tor me- to comment upon the motives OF
THIS attack aud the character vi the men Assoc
Ciated with II
The petition is signed by Abram King. He
was o director IN the American surety Com.
pany, Of which | was President, before | be.
came President OF the rust company. Several
OF our directors objected TO his presence In the
board and | caused that fact to be conveyed to
MN several times, with the further lntimation
that we should Ue pleased to have his resigna-
ton. Finally he did resign
The Examiner OF the Banking Department.
ten. Avery .: Andrews. appeared here accom-
panied by Maurice Decker. Decker was Accre-
tary OF the Trust Com pany under its old man
h2ement, Before accepting the presidency I
COMPELLED his resignation for cause. Decker
assumed in his visit here with Gen. Andrews
70 represent the banking Department, though
II turns out now that he had no authority to DO
90 The ai!egqtions n h,,ng's petition we're
termines. 40 that the whole scheme has mis-
carried and failed,
This COMPANY. as Mr., KIburn officially
during the nine months 81, our control We
have Increased its surplus s50U.0oO, and in
ten wears prior thereto. Our average dcposit,
have doubled, and In every direction the COM
Iants business has prospcIed.""
In regard TO that Iayn loan" said a person
who is able to speak OF the affairs OF the bank.
the facts are simply this. The State Trust
Contrary did loan money TO Mr.. Payn as 1t had
Il perfect right to do. Mr.. Payn put up good
security ami among the other papers was a
cheek for SlOO.OOO that was drawn 10y the
METROPOLITAN street Railway Company ON the
trust com pany. Several weeks ago. before
the complaint Of Mr.. King was made to the
hoVerhOr, u was reported 70 the metropolitan
Street Railway Company that the check was
eng held az collate raj against the loan, and
The company promptly reported TO the trust
com auy that this check was not to be held as
collateral but to be applied as part payment OF
the loan, Ii was 50 applied and the rest OF lie
loan Is secured by good stocks held as collat-
eral"
There was n special meeting OF the
officers and trustees yesterday. Tho an
nouucement was made for the ilrsttims
Yesterday OF the election by the State
Trust Comp ny Of four new trustees: J. b.
Duke, William Jay, Charles +. Warren. AMI
Harry Payne Whitney. Two OF these are 10
MI places left for some time untitled the other
two 70 nll vacancies caused by the retirement
Of Willis =. Paine and Thomas A. Mcintyre,
Mr.. Paine. 1t is said. retired TO become The head
Of anorher company. Mr.. Mcintyre was the
y Ice President and Is still a trustee Of the Pro.
duce lENchnng" Trust Com pany, which recently
closed its doors. but has since been reorgan-
lied.