Omaha daily bee., 1905-09-26
large Advances to Iusolvsnt Salmon Bank
Frightens DspOsitOu,
STEADY RUN FOR SEVERAL WEEKS
Trust Company Takes Over All Assets Of
the Bank.
'EPoslToRs TO BE PAID ON DEMAND
Collateral from salmon Bank that
Caused Trouble Now said 90
BE of the highest
Grade.

KANSAS CITY Sept. S.-The Kansas
CITY State bank, Wiley o. Cox, president
failed to open its doors today. having gone
into voluntary liquidation The bank had
loaned $l6S,0O0 to the bank of Salmon &
Salmon at Clinton Mo-. which failed last
July catching depositors Cor several hun
dred thousand dollars
The Kansas City State bank was or
ganized in 1883 and had capital Of 100000.
inc last statement showed loans Of $4,O0O,-
600; deposits, A,75O, 600; surplus, $4,000.
The following notice was posted on the
door at the opening hour today:
This bank has gone into voluntary uouid-
alton through the Fidelity Trust company
checks drawn against the bank will be paid
pany at Ninth and Walnut Streets.
WILEY O. cox, President
The Fidelity Trust company, which is
capitalized at a,OOO.OOO, is considered one OF
the strongest banking institutions in the
southwest
The Kansas City State bank holds S5s7, 900
of the city's money
Wiley o. Cox president OF the Kansas
City State bank, is one of the Oldest and
best known men in Missouri. He has
| lived In Missouri since 1865. In 1872 ne was
| a clerk in the First National bank at
| Springfield, Mo, coming to Kansas City in
1881. From 1884 to 1888 he was engaged in
a general financial and brokerage business.
! He organized the Kansas City State bank
\ in 1888, and has always served as its presi-
! dent. In 1896 he bought the Kansas City
| Times, venture that did not prove sue
cessful, and in 1899 he sold the paper
At the Fidelity Trust company's bank
checks on the Kansas City State bank
were honored as fast as presented There
was no show of commotion and Charles
| CamDhnll 81 he
Trust company, stated that all checks
drawn on the closed bank would be paid
upon demand.
Mr. Campbell declined to talk OF the
causes leading up to the closing of the
Kansas City State bank,
Statement of President.
Wiley o. Cox. president OF the Kansas
City State bank. made tho following state
ment to the Associated Press, \ s--sS@.g
The retirement OF the Kansas CITY state
bank from active business is voluntary
Our business has not been growing for son a
time and we found II hard to hold our own
! with the larger institutions In fact Il
looks as If the banking business, as we'll as
all other lines is concentrating into the
The condition OF the business was thor
oughly gone over by the board of directors
| and the conclusion was reached that II was
not prospecting as It ought TO do in order to
be profitable, and II was determined TO go
into voluntary liquidaton; One plan which
own liquidation. paying deposltors de-
mand and taking on no new business This
would have involved borrowing a large
sum of money on the banks paper in order
to pay depositors at once, the force OF
tically the same as II the bank we're running
in the usual and ordinary way, Accord
ingly negotiations looking to the liduidat ton
of the business through other banking in
stitutions were begun, and have finally re-
satisfactory arrangement whereby the
Fidelity Trust company, one OF our strong
est banking houses has taken, over the
business of the bank and is paying Its de-
positors in the ordinary way on demand,
the same we would be doing IL still
On retiring from the banking business.
for the present, after an active career OF
many years, cannot help feeling extremely
proud that no depositor has ever failed 20
have his checks honored and paid on pre-
sentation at any bank with which have
been connected.
The Fidelity Trust company volunteered
to pay the city treasurer the amount OF the
city's funds on deposits in the KANSAS City
State bank. but the money was not with
drawn
Meeting of Directors.
The decision to liquidate was reached fol-
lowing a meeting OF representatives Of the
clearing house banks. A thorough investi-
CATION of the accounts of the bank had
been made. a carefully prepared statemen,
OF the resources and liabilities, checked in
every detail and the cOllaterals held for
loans appraised by financial experts. This
was done at the request of the banks ON
: cials, who were seeking way TO close th'
bank without placing in jeopardy one dol
= lar Of the depostors' money. Ever since
the failure of the Salmon & Salmon bank al
Clinton, Mo, the banks business had beer
on a decline. Many large depositors with
drew their accounts because Of the fac
l that the bank had advanced the salmon'
more than 10000 on collateral that is nov
said by bankers to be gllt-edged. At th'
time the value of the collateral was prob
lemstical and timid depositors hastened L
close their accounts. This caused a heav!
drain on the resources of the bank. and II
order TO avert trouble the officers Of th'
institution decided upon liquidation as IN,
"a siest way out of a perplexing hnanciI.