New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1901-06-28
SEVENTH NATIONAL FAILS
Continued from first page

Office business. which had for ten years bean
held by the Chase National. accentua+ad ,ba
feeling.
COUNTRY BANKS DEMANDED MONEY.
When the rumor spread that the Seventh NJ
tional was in straits the country banks did no,
follow the example Of the large depositors here
ana stahd oy the bank, but instantly demanded
their money.
No sooner was il known that the ssya,,h
National Bank had suspended than almost every
bank downtown began communication with the
insolvent banks interior correspOndents IN, +a,a
phone, telegraph or letter JUROR oficiaIs 90
several Of the local banks went out OF town on
Wednesday night TO try TO secure these ac
counts.
1t is understood that the demands of the Sew
enth National Banks out OF town corresnond-
ents yesterday amounted to about S9,6ODo
Against this the Seventh National Bank sent in
for collection from other banks checks and
drafts amounting to about 100000 the result
being debit balance larger than the bank could
nquidate.
Assistant Postmaster Morgan said yesterday
that the $4,000 of government bonds advanced
as surety by the Seventh National Bank were
deposited with the Treasury Department in
Washington. The Seventh National Bank he
added was the depository for money order funds
and not for all moneys received by the Post
Office Department The exact amount now on
deposit with the Seventh National Bank he
could not state definitely, but he said:
Il am positive that the government is amply
protected The average amount of deposits
from the money order department is sl5OOoO
daily. Possibly it may be larger than this, but
as l say We have never drawn beyond the
amount Of the surety given by the bank"
A Trnc
The closing of the bank caused some incon-
venience 20 local merchants who cleared their
postal notes and money orders through their
own banks into the Seventh National Bank
With that institution closed this procedure was
of course, impossible, and postal orders had TO
be cashed direct at the Postoffice.
II is a rather unusual thing for national
bank 10 fail. and a very unusual thing for the
New-York Clearing House Association to refuse
aid 10 a member bank in distress. The reason
why the Clearing House Committee turned
deaf ear Tuesday 10 the appeal OF the Sew
e1th National was thus explained yesterday by
Clearing House official:
No solvent bank has ever been allowed to fail
BIZ the Clearing House. The Associated Banks
have always come TO the assistance OF MEM
Der that happened to be temporarily embar-
raised. The one condition always imposed
was that the securities must be up 10 banking
standards. The loans objected 10 in the case OF
Seventh National based
that the banks could not accept For this rea-
son, and other, assistance was refused
UNSATISFACTORY COLLATERAL
The fact that the collateral held by the bank
was Of an unsatisfactory character. at least that
turned in by Henry -darquand & Co. was ad-
United freely last night by the new management.
in the following statement in which the policy
Of the Kimbau administration sharply criti-
cised:
William Nelson Cromwell, special counsel for
the Seventh National Bank, gave out the fol-
lowing statement from President Thomas, and
added that he engaged in preparing plan
for the reorganization of the affairs of the bank
and that II believed that a satisfactory plan
would he presented early date
MI Edward r. Thomas, president Of the Sew
enth National Bank stated that the difficulties
Of the bank were due solely TO the making by
the previous executive officers of large ad-
Vances TO Marquand & Co, and that the Sc
character although of considerable intrinsic
value; that previous TO Monday last he him
self had never had any relation to the bank as
director officer. but upon the urgent applica-
ton Of the board he and his associate, Edwin
Could had furnished financial assistance to
a large amount, upon adequate securities ana
upon the assurance that the obligation of Mar
quand & CO. would be made by this morning;
that the firm named had. however failed 10
fulfil expectations. and while he and Mr.. Gould
and OF the directors were willing TO fur
nish further financial aid. IL was not deemed
by them just, either 10 the depositors, stock
holders or the public TO invite deposlts ano
credit until the affairs Of the bank were again
placed upon an absolutely sound basis; that
for this purpose reasonable time was necessary,
and 10 prevent unfair preferences or advan-
ages the board determined, with the advice of
counsel TO suspend operations for the present. =
CONDITION OF THE BANK.
The condition of the bank as Of June 26 is
shown in the following statement made public
last night by President Thomas: