Los Angeles herald., 1907-10-22
FINANCIAL
SITUATION
IMPROVING
ALL CLAIMS ON NEW YORK
BANKS MET
STOCK MARKET 6uoYANT AND
PRICES ADVANCE
Mercantile National Banks Debit
Amounts to Nearly 100000, but
Clearing House Comes
to Rescue
b. Associated Press.

By Associated Press
NEW YORK, oct. 21.--Late tonight
the National Bank of Commerce gave
fwenty-four hours notice to the Clear
ing House association, of which 1t is u
member. that after tomorrow 1t would
mn longer clear for the Knfckerboci<er
Trust company. The directors OF the
National would not comment upon their
action. The National has for some time
acted as clearing agent for the knicker-
booker. Following the action Of the
National there was a conference of the
directors. of the Knickerbocker Trust
company mt an uptown hotel. 1t was
reported that Charles II. Barney, presi-
dent of the knickerbocker, placed his
RESIGNATION in the hands OF the direc-
tors who at once decided upon Foster
Higgins to succeed him.
NEW YORK, Oct. 21.--The recent ten
sion of the banking condition was today
considerably relieved, and the day
passed with no adverse Developments
of serious character, but with much
that was reassuring.
At the same time there was evidence
that some of the banks most affected
by recent events were still in need OF
assistance, but the promptness with
which the clearing house accommo-
dated it did much to delay further
alarm.
The general Improvement was re7
f1ected in the buoyancy of the stock
market and the steady advance In
prices from previous low levels. On
the other hand the cons ervative element
deferred a too optimistic view until the
relief given by the clearing house had
continued for several days and had per-
manently re-established the stability
of some of the weaker institutions, not
ably the Mercantile National bank and
the New Amsterdam National bank
The clearing house was called upon
to meet debit balances of the Mercan-
tile and the New Amsterdam banks to
the extent of upwards of $2.000,000, OF
which the Mercantile owed about
100000 or more. The debit balance
of the National Bank of North America
amounted to $S50,Oo0.
While there was said to have been
some discussion between the clearing
house committee and the officers of the
latter bank as to the necessity of CIV
ing it any support, it was not found
necessary to do so and w. III. Have
meyer, the new president of the insti-
tuition, declared the bank had not asked
one dollar of aid from the clearin g
house.
Situation Better
"The situation" Mr.. Havemeyer said,
ais really far better than we expected.
So far only about $4,000 has been
withdrawn. When the bank opened
this morning we had s1.0oo,oOO on hand
to pay all comers, but only small por-
tion was used"
The fact that the clearing house re-
CARDS the situation as still serious was
shown by the remark by a member of
the commission that the Mercantile
bank debit balance was unexpectedly
large and disconcerting.
The commission remained in session
the greater part of the day discussing
plan of policy with regard to assist
ing such banks as might need help.
After the committee had adjourned for
the day JaSnes T. Woodward, president
of the Hanover National bank and
chairman of,the commission, said the
conditions were improving and that
.he commission felt equal to meeting
any emergency that might arise to-
morrow.
William Sherrer, manager of the
clearing house, stated that the situa-
tion was under control; that some of
the more awkward features had been
eliminated, and that from this time
there would begin new era in New
York banking. Mr.. Sherrer said also
that the clearing house committee
would carry out the policy announced
to discharge their obligations
The committee, 1t was added would
meet every morning to pass upon the
collateral offered in settling debit bal
ances.
At meeting late today of the directors
rof the Consolidated National bank. Will
dam @. Allison was elected president in
the place of Orlando F. Bomas resigned
as was decided at an informal meeting OF
ftha 6irertora veaferdau
Petition In Bankruptcy
An involuntary petition in bankruptcy
was fled in the United States district
court today against the firm OF Otto
Heinze & Co., brokers, whose suspension
from the stock exchange was announced
last week after they had refused to ac-
Cept block Of United Copper stock pur-
chased for them by the firm of Gross &
KIeiberg
The petitioning creditors are william
H. Robotham, as assignee of the firm of
Gross & Kleiberg with a claim of $325.373;
Leo Wise, who has an assigned claim
from Edward v. Brokaw in the sum of
SO cents, and Frank A. Brandy, who has
an assigned claim from Herzfield &
Stern of S2e0l. They allege that Otto
Heinze & Co. made preferential pay
ments to the Merchants National bank
of S2,0O0000 or assigned securities and
also other preferential payments which
aggregated about 100000. 1t is alleged
that valuable securities were assigned to
F Augustus Heinze and Arthur p.
Heinze to secure antecedent indebted
ness, and because of an anticipated eus-
pension of the firm by the stock ex-
change
Arguments Of appointment of a reoeiver
were postponed until Wednesday The
clearing house committee. at meeting
held today at the Mercantile National
bank, advised the acceptance of the resig-
nations of eight directors of the bank.
This was done and five new directors
selected. The other vacancies will be
filled later.