The Goldfield news. [volume] (Goldfield, Nev.) 1904-1911, 1910-04-16

- ELkIt Oah
me,t concerning the Eureka BAN
80 that will be read with interest
n 'Witcher, another member of tn
- has gone to Eureka, where h
III law full data, and voluminou'
~.,rds. ETC., before the grand jur,
MA TO investigate the condition o.
- ,onk. Governor Dickerson' Is state
ment follows;
!, having come to the knowledge Of
,tate banking board that by reason
n, having closed the Eureka county
hank. and the attendant criticism OF
.bs board, public confidence in the
hanks of this state has been consider
.hlv shaken, as chairman of the board
sss;re to make the following state.
nent.
rolan as a whole, the banking in
..;tnt;ons of the state have never been
:, "a GOOD condition as they are today.
The great majority of them are in
.,le,aid condition. By actual count
s5 ner cent of them are practically be-
vona criticism. They are carrying
aorae reserves and conducting their
BUSINESS on the most conservative
r,oo There is no comparison be-
tween their condition today and a year
AGO. The percentage of reserve car
ried is practically double; capitaliza-
tion wiped ou5 or reduced to within the
legal limit, and secured as provided
bv the new law. Most of the banks
Of the state today will measure up to
the standard of national banks in this
and neighboring states.
When the law went into effect
creating the present board one year
400. a different state of affairs was
found to exist. There were eight or
10 banks in the state in fully as bad
condition as that of the Eureka county
hank and some of them were in a
worse condition. A strict application
Of the new law would have closed
every one of these, and coming as 1t
would on top of what the state had so
recently undergone, fully one-half the
hanks of the state would have gone
down, working untold distress on its
citizens and making Nevada an object
of seorn to the balance of the country.
After much careful consideration,
the board resolved to build up instead
of tearing down. With the m ex-
ception of the Eureka county bank,
their plans were completely successful
and that bank today will pay more
10 it's depositors than if closed a year
ago. AS to the banks that were saved,
they are among the largest and strong
est in the state, deservedly enjoying
the respect and confidence of their
depositors and reaping the legitimate
profits to which they are entitled.
The Eureka county bank was one
of many in which we found excessive
loans which crippled the institution
None of the large loans now on the
books of the Eureka county bank
we're made subsequent TO this board
assuming supervision of the banks OF
the state. These loans while gripping
the bank, did not necessarily render
the bank insolvent. The solvency or
insolvency of the bank depended upon
the goodness or badness of the securl-
ties hypothicated for the loans. I'M
mediately after the examiner made BIS
first examination of the bank the board
earnestly e~ndeavored to determine the
value of these securities and to that
end the examiner made repeated re-
quests of the Smith brothers to furnish
him with a list of the assets OF the
Eureka County Live Stock company,
of the Smith Bullfrog Investment COM
pany and of the Smith Brothers Invest
ment company, whose stocks were
pledged for loans and ordered that the
loans be reduced at once to within legal
limit. Failing to receive a list OF the
assets of the companies above named'
the board called MI. Oscar j. smith
and Mr.. Bert L. Smith before them at
a meeting in Carson City and demand
ed that these lists be furnished, waich
the Smith brothers promised to 10 at
once. Later the following letter was
sent the Smiths:
"October 7, 1909.
Mr.. Oscar J. Smith, President,
Eureka County Bank, Eureka, New.
Dear SIR
The state banking board from 'ee
examination of the affairs of the Eu-
reka county bank, has found 1t neces-
sary to be specifically advised as TO
the assets and liabilities of the Eu-