Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-05-23
BUSINESS SUSPENDED
Merchants Trust Company of
New York Closes Doors.
S T ATEMENT ISSUED
UNABLE TO TURN SECURITIES
INTO CASH QUICKLY.
President Phillips Exonerated From
All Blame in the Muddle-
Receiver Shortly.
STATEMENT ISSUED
Special Dispatch to The Star.

Special Dispatch to The Star.
NEW YORK, May 23-The Merchants
Trust Company, which has its main office
at 346 Broadway. and a branch at 500 West
99th street, closed its doris this morning
shortly before 10 O'Clock. the usual hour
Tor opening the bank, Samuel Untermeycr,
counsel for the company, emerged from a
meeting of directors and announced that
upon his advice the officers had decided to
suspend the business. By 10 O'Clock there
were dozen persons in line, as Usual. wait
Ing to draw out money. and a similar num-
Der ready to make deposits, but tire tellers
wickets were not open Bank Examiner
A. c. Judson was behind the counter, and
about ten minutes after the time the bank
should have opened he posted on it's doors
the following notice: 1.-The Merchants
Trust Company Is closed by order of F. d.
kilburn. state superintendent of banks.
While Mr.. Judson was posting NJ his
notice, MIR. Untermeyer was preparing the
following statement, which he issued short
ly thereafter: I'm view of the publicity
| that has been given to the efforts of the
company to increase its cash resources and
to the unmarketable character of certain
of the securities. which it holds 5 collateral
for large loans, I have advised me presi-
dent to recommend the suspension of bust
1859 81 DIS u prevent d run on the IDSll-
tuition.
Mr.. Philips has been president for only
few months. The loans that have Grip
pied the cash resources were not made
DER his administration and he has no re-
Spons1bilfty for them. Ever since Mr.
Phillips assumed office his efforts have
been directed toward inducing those under
whose administration these loans were
made to take them out of the institution
This has not yet been done, but 1t may be
done. The president will probably make
h a statement later"
President Jacob l.. Phillips said at the
time Mr. Untermeyer issued the foregoing
statement that the directors were still in
session and that as soon as they concluded
their meeting a statement would be is
sued by the president, probably early in
the afternoon Until the issuance of his
statement he said that he did not care to
discuss the companyS troubles.
Receiver Shortly.
Bank Examiner Judson said that re-
ceiver would probably be appointed short
ly upon application to the attorney gen.
eral. Mr.. Judson added that it would
probably be a week ten days before the
state banking department completed its
present examination of the books, and that
until that time he was not at liberty to
discuss the affairs of the bank.
AS the bank counters transacted no bust
ness this morning there were new de-
posits accepted and no money paid out
The number of patrons at the trust COM
pany's offices this morning, 1t closed,
was normal. None manifested any anxiety
If anyone present suspected that the COM
pany was in serious trouble he did not
show it. Not until the news of the COM
pany's suspension spread rapidly through
the dry goods and the financial districts
was there any commotion at 346 Broadway.
The Present Officers.
The present officers of the Merchants
Trust Company are as follows: President
Jacob L. Phillips; vice president, Cassius
M. Wicker: secretary treasurer. Frederick
p Davis; assistant treasurer. Jacob j.
Coyne.
Directors: George C. Batcheller, Ronald
K. Brown, John Cantlege, George C.
Clarke, Frederick p Davis, Thomas L.
don. John P. Mum. Jacob L. Phillips
James E. Reynolds Henry Sampson. David
s, Walton and Cassius NJ. Wicker.
The company has been in operation about
six years. Its statement at the close of
business December 81, 1904 showed that
1t had capital stock of 500, COO a surplus
of $l,oWOoo. undivided profits of sl9S.737
and deposits amounting to S3,367617. 1t
had loans amounting to S2074COO, cash on
hand in banks of S1,4S1.6OS, and it had
s5O7 800 worth of New York city bonds and
about $3So00O worth of other stocks bonds
and investments.
A person familiar with the affairs of the
company said today that the principal
cause of the suspension was the inability
large loans it had made upon bonds of the
Hudson Valley railroad and some Rutland
property. This financer said The Mer-
chants Trust Company has as collateral
81, 200 600 worth of bonds of the Hudson
Valley railroad, system of trolley COM
panies operating between Albany and Sara
toga, and 1t loaned about $1,000 worth
upon some Rutland property.
Meeting Of Directors.
when the directors met this morning
about 9:30 o'clock, there was disposition
on the part of those present to make
heroic efforts to weather the financial
gale which they expected would follow
the rumors in circulation about the Mer-
chants Trust Company ever since late
yesterday afternoon. But Lawyer Inter
meyer, who is regarded as an expert in
insolvency matters, after realizing the
situation advised President Phillips and
the other directors that it would be wise
to accept no more deposits and also to
refuse to pay out any more money. He
took the ground that the company was
technically insolvent. He foreSaw that a
run was inevitable, and that the company
had better hang on to all the funds it
could, SO as to make the best settlement
possible with the depoSitors and stock
holders, even If it was not able to resume
business.
President Phillips Statement.
President Phillips made the folIOwin1