The news & observer., 1905-12-19
6By the Associated Press.D


Chicago. Dec. 1S.-Three of the
largest financial institutions in the
west. the Chicago National Bank. the
Home Savings Bank and the Equita-
BILE Trust Company. all of them con-
trolled by John II. Walsh. of Chica-
60 and in a great measure owned 10y
him, suspended operations today..
rapidly as possible and they will go
out of business.
Mr. Walsh, who was the President
of the Chicago National Bank and
of the Equitable Trust Company ard
all the other afficers and all the direc-
tors of the Chicago National Bank
have resigned. Naional Bank Exami-
ner G.. II. Bosworth has succeeded Mr..
Walsh at the head of the Chicago
National Bank, and the places of the
directors have been flied by men APP
pointed by the Chicago Clearing
House.
Back of the new management stands
the allied banks of Chicago. which
eryhave pledged their resources tnat
every deposior shall be paid TO The
last cent. and that no customes of
any OF the three institutions shall lose
lose anything by reason of the sus-
pension. This action prevented dis
asUrous financial panic. As it was.
the only effect on the financial world
of Chicago was the decline on a
stock exchange Of 1-2 in the price
of National Biscuits common stock
The National Buscult Company has
employed the Equitable Trust as
transfer agent. and had besides deal
ings with the Chicago National Bank
but it is not affected by the failure
i'm the slightest degree. The closing OF
the two banks had the effect also CT
shutting off all demand on the locaf
exchange for bank stocks. none Of
them being purchased.
The Cause of the COLLAPSE.
The immediate cause of the col
lapse of the institutions controlled by
Mr.. Walsh is said to be the largest
amount of money which they have
lent to various private enterprises of
his. noably the Southern Indian Rail-
way and the Bedford Quarry Com
pany. of Indiana. Mr.. Walsh says
that if he could have saved his banks,
and made enormous profits for hirn-
self and his associates. He bases tE1s
statement on his estimate of the value
of the bonds of the Southern Indiana
Roilroad Company.
and the members of the Chicago
Clearing House Committee place the
value of the bonds at one half the
valuation of Mr.. Walsh. and 1T was
their refusal to accept his valuation
that caused the suspension of the
banks.
Liabilities Twenty-Six Millions.
The liabilities of the three institu-
tions are estimated in the aggregate
at $26, 100000. Against this amount
the banks and the trust company have
resources, that are. on a conservative
estimate. worth $4,000. 600. The
bonds fthe Southern Indiana Rail-
road Company are estimated by Mr..
Walsh at $16.0O0.000 They are con-
sidered by the comptroller. the State
auditor and the clearing house COM
mittee to be worth a little more than
half that sum. Their value is a
matter to be determined i'm the future
and the presidents OF the local banks
admit that if the estimate of Mr.
Walsh is found TO be correct the two
banks and the trust company will not
only pay all of their debts. but leave
a surplus besides.
The directors of the two banks. as
we'll as Mr. Walsh. who has turned
all OF his private property as we'll as
that standing in the name OF Mrs
Walsh. have pledged real estate and
securities valued at $4,000. 900.
making a total in assets of s29.000.-
000 estimating the railroad bonds at
sS.G0e. 900, against $4,000, 600 liabili-
ties.
An Unheeded Warming.
For some time there has been
difference of opinion between the off,
GERS of the Chicago National Bank
and Comptroller Ridgeley, regarding