The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1909-10-01
President Merton of Columbia
Bank Receives Ultimatum.
Must Raise S25O,OOO Before He
Can Resume.
POLITICS IN DEAL.
Pointed Out That Democratic
Supremacy Was Stake.
Question Whether the Institu.
tiOn Was Really InselveHt.

OkIahoma City, Okla, Oct -
Ihere was much activity here today
In the promotion of plans to re-
haDlhtate the defunct Columbia
Bank and Trust company, which IS
now in the hands of the state bant-
commissioner. The future of the
bank however. is as yet undeter-
mined. Although no official an
nouncement was made by the state
banking board today, an official ~
the board said If President Norton
or the closed bank and his friends
can raise $250,000 in cash the bank
VIII be turned back to them
president Norton is now confident
OF pelng able to raise the money. The
announcement last night that tho
oank would pc turned over to the old
omclaIs on Monday next appears to
nave been premature
The Oklahoma guaranty law has been
Ised by the present Democratic state
Governor Haskell is the father OF fhe
law In Oklahoma. 1t is noticea bile here
at all times among state officials that
any Iallllre OF the law to do all that
pions would be regarded as nothinc
less than party calamity For that
reason all information concernfne the
analrs OF the failed bank that might
ful liquidation of the bank or tbat
might involve other institutions ana
persons In 1T is under lock and kew.
Bad Paper Not Reported.
Here is a part, at least, of the story
that may not truthfully be denied:
ABOUT ~ days ago the bank commits
sioner sent two of his skilled exanoinars
10 examine the bank. They reported
that the bank was clean from ton to
bottom. Since then the bank comrnis-
edoher SIC found between $S0O000 and $400.-
GOO in paper given bv oil operators in
eastern Oklahoma This paper either
escaped the two examiners who check
ed the assets of the bank or was taken
aIter the bank had been last examined.
The bank commissioner believed that
TINS oil paper impaired the capital OF
the bank and the result. was the clos
irg, of the banks doors. There. Is 9TH
er paper in the bank that is not good
but how much or it's exact nature no
one has been able to ascertain
President Norton Is known to nave
held stock in a number of. state banks
He said positively Thursday, however.
that he does not now own stock In any
bank In Oklahoma, except the Columbia
Bank and Trust company. This indi-
Gates that he has sold his holdings
in the last few days. The names of
some Of the state banks with which
he was connected are known, and the
of the state bank Commission
er's department would disclose whether
these banks. But the bank connrnfs
sioner declines to give any infcrnna-
ton upon this point.
Already there is talk among persons
who do not accept the guaranty law
as specific for all the ills of the bank
ing business, that the liquidation of
the Columbia Bank and Trust COM
pany would not be a definite proof
dispute. These persons are saying. for
instance, that perhaps the situation is
not as difficult as 1t has appeared, and
as the public was led to suspect If
al ank 20. En
worthless, and the other assets of
the bank be of fair negotiable value.
then the handling of the failure would
not be greatly unlike that of the Inter
national Bank of Coalgate in 1908.
The Coalgate bank was closed for
the alleged reason that it's officers had
borrowed beyond legal limit, and
that it's capital stock thereby was i'm
paired. The officers of the bank as
serted stoutly that the bank was so1v-
ent, and that closing it was not the
proper way to right the wrong. The
Coalgate bank had $4,000 in deposits
and a capital stock of $4,000. De-
spite its sudden and enforced closure.
all depositors were paid in full. The
bank guaranty fund was replenished
for all funds advanced and the stock
holders got 55 cents for each dollar
of their stock. There was considerable
expense attached to the Office of the
dent led to bitter public accusations
that the banking board needlessly
closed the bank, and that this served
political purposes in demonstrating
what the guaranty law is worth. State
ments of this kind were used frequent
ly in the campaign of 1908.
Decrease in Deposits.
1t was ascertained that September q,
the total deposits Of the Oklahoma City
were approximately 21z million dollars.
a decrease of more than 100000 since
its report was made to the bank com
missioner early in the month. The To-
tically one-third the entire deposits.
The state banking board is collecting
its annual levy of one-fifth of 1 per
cent from the state banks, which will
amount to $4,000. The emergency levy
Of three-fourths of / per cent, author
lied by the board for the relief Of the
depositors of the Oklahoma City bank,
is not vet being collected. The state
banks paid an initial levy of per cent
of their deposits. Upon all annual in
crease in deposits a levy of 1 per cent
must be paid. while upon all deposits
an annual levy of one-fifth of per cent
must be paid until the guaranty fund
shall contain per cent of the total de-
posits of the state banks. An emer-
gency levy of not more than 2 per cent
may be made in one year.
The Commerce Trust company OF
Kansas City paid to the state $4,000
covering the official bond of James
Menefee, the state treasurer, who had
a deposit for more than three times this