Audubon County journal. (Exira, Iowa) 1884-1993, 1905-12-21
CHICAGO FAILURES

| CHICAGO FAILURES
INSTITUTIONS INVOLVED IN J. r.
WALsH's DEALS WIND UP.
Had Been Putting Assets of Chicago
National, Home Savings and Equta-
BILE Trust Into misunderstanding
Houce Saves Depositors.
| Chicago, Dec. 19-Three of the
west, the Chicago National bank, the
Ho 4 Savings bank and the Equitable
Trust company, all of them controlled
by John r. Walsh of this city and in
a great measure owned by him, have
suspended operations. Their affairs
will be liquidated as rapidly as pos
sible and they will go out of business.
Mr.. Walsh, who was the president
of the Chicago National bank and of
! the Equitable Trust company, and all
the other officers and all the directors
of the Chicago National bank have
resigned. National Bank Examiner
| G. H. Bosworth has succeeded Mr..
Walsh at the head of the Chicago Ma
tional bank and the places of the di-
rectors have been filled by men ap-
pointed by the Chicago Clearing
house. Back of the new management
stand the allied banks Of Chicago,
who have pledged their resources that
every depositor shall be paid to the
last cent and that no customer of any
one of the three institutions shall lose
anything by reason Of the suspension.
Had not this action been taken by the
banks of the city, a disastrous panic
must have followed in the financial
world. AS it was, the only effect
in this city was the decline
on the local stock exchange of 21a
| in the price of National Biscuit
common stock, which has employed
the Equitable Trust as transfer agent,
and had besides dealings with the
Chicago National bank, but it is not
affected by the failure in the slight
est degree. The closing of the two
banks had the effect also of shutting
off all demand on the local exchange
for bank stocks, none of them being
purchased.
Cause Of the Crash.
The immediate cause of the col
lapse of the institutions controlled by
Mr.. Walsh is said to be the large
amount of money which they have
loaned to various private enterprises
OF Historically the Southern Indiana
| railroad and the Bedford Quarries
company OF Indiana. Mr.. Walsh
claims that if he could have had lit
tie more time and been left untram-
meled in his operations he could have
saved his banks and made enormous
profits for himself and his associates.
He bases this statement on his esti-
mate of the value of the bonds of
the Southern Indiana Railroad COM
pany. The comptroller, the state aud
itor and the members of the Chicago
| Clearing house committee place the
value of the bonds at one-half the val
uation of Mr.. Walsh, and it was their
refusal to accept his valuation that
| caused the suspension of the banks.
The liabilities of the three institu-
tons are estimated in the aggregate
at S26,OOO,OO0. Against this amount
the banks and the trust company have
resources that are, on a conservative
estimate, worth s16,0O0,OO0.
The directors of the two banks and
Mr.. Walsh, who has turned over all
of his private property as well as
| that standing in the name of Mrs.
Walsh. have pledged real estate and
securities valued at 100000 and es-
| timating the railroad bonds at S.
| 100000 more, making total of $27,-
100000 assets against $26,OOO,OOO liza
| bilities.
Promises Not Kept.
For some time there has been a
difference of opinion between the Off
GERS of the Chicago National bank
and Comptroller Ridgely regarding
the method of conducting the affairs
OF the bank. The comptroller took
exception to the large loans made by
the bank to the private enterprises of
Mr., Walsh and declared that por-
ton of them must be called in. As
surances We're given to him, he de-
clares, that this would be done, but
the promises were not kept. Finally,
the incentive to a close scrutiny of
the affairs of the Chicago National
and Home Savings banks was given
by banker in New York, who had
been requested to take part in a syn
dictate to furnish loan of $6,OO0,0OO
to Mr.. Walsh for the purpose of fur
Their expenditures on the Southern In
diana railroad. The bonds of the
company, however. did not sell as
rapidly as was expected. and the state
and national examiners We're ap-
prised OF the failure of the loan. Up
to this time the banks had been ex-