The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1912-01-20
Larger Trust Companies Favor
ed, Holland Says.
Equitable Trust to Take Over
America at High Price.
HYDE BEHIND SCHEME
Company First Organized for
His Benefit.
American Tobacco Certificates
Are Things of Beauty.

New York, Jan. Cot is a reason
able inference that the president of the
Equitable Trust company. Alvin
Krech, and the president of the Trust
Company of America, Oakleigh
Thorne, were fairly we'll assured that
the proposition made by President
krech to purchase the stock of the
Trust Company of America If as much
as two-thirds of this capital stock
could be bought for 1915 a share would
be accepted by at least two-thirds Of
the Trust Company of America stock
holders. President krech says that he
has personally made the offer to pur-
chase the stock of the Trust Company
of America since the Equitable COM
pany itself could not buy the stock.
That statement reflects a distinction
which IS legal while at the same time
there is not much difference in the ac-
tual effect of the purchase. Should
the stock be bought by President
Krech, then the Trust Company of
America would go out of business, and
there are certain formulas or meth
DDS which are we'll within the law
which would make it possible for the
Equitable Trust company to absorb the
securities and resources, probably to
take ever the greater part or the de-
pests, and pay for the same by an ex-
ira dividend declared by the Equitable,
with which the stockholders of the
Equitable would be able to pay for the
Trust Company of Americas stock
Should the deal be consummated. it
will illustrate how rapidly through alb
Eorption and favoring circumstance
trust institutions can be built up
Ten or twelve years ago what is now
the Equitable Trust company was only
a little side issue with the Equitable
Life Assurance society The late Henry
B. Hyde, president of the Equitable
Life organized this corporation solely
for the purpose of dealing in loans
made upon Equitable Life policies. and
in some other business incidental to
work of that kind. It was for some
years possibly the most incons1derable,
certainly the most incOnSpicuouS, lnstl-
tuition in New York City which car
ried on a certain form of banking busl-
ness-the lending of money upon pc
culiar kind of security.
Hyde Behind the Plan.
There seemed, about ten years ago,
however. to be an opportunity Tor
rev trust institution sponsored by the
Equitable and not dangerous com
petitor of the Mercantile Trust. Whlch
for years had been identified with the
Fouita BILE Life Assurance society. The |
presumption was that the new organi-
cation was effected for the purpose OF
giving James Hazen Hyde special op-
portunities for profitable utilization or
some of the funds possessed by the
Equitable The first president of the
reorganized Equitable Trust, the late
William T. Cornell declined to author
some of the Influential forces OF the |
Equitable insisted must be done Presl- |
dent Cornell felt certain that the /
transaction would be in violation OF the /
EpIrit. if not of the letter. of the state /
banking laws BY reason of his attl-
tude Mr.. Cornell was retired ana /
shortly following his retirement came |
the insurance company investigation 4
conducted by Charles Z. Hughes.
The Equitable Trust, however, was |
not involved in any important way in
these Investigations, and its new man |
agernent took advantage of unexpected /
opportunities, such, for instance, as the |
chance to absorb the Bowling Green /
Trust company. which had been created |
in the interests of the Gould family, /
and also another trust institution. It's |
capital. it's resources and its deposits !
increased very rapidly, SO that in the |
course of few years it developed from |
a little institution whose chief business /
was the loaning of money upon Equit- |
able Life Assurance policies to Ona of |
the larger and stronger of the trust in !
situations of New York.
Wonderful Recovery.
About the time the Equitable Trust /
was thus greatly enlarged the Trust /
Company of America was organized. !
and until the panic year of 1907 it |
seemed to be one of the most flourish |
ing of trust institutions of New York |
Then it passed through a spectacular I
and dangerous crisis in the panic days |
of 1907 which was occasioned in great /
part, as was alleged, by the inability /
of high financiers to whom it had loan /
ed large amounts of money on the Sc !
curity of the Tennessee Coal and Iron
company stock to take up their loans 1
There were very bad hours, and even I
half hours. in those times of crisis and |
panic, but the institution was pulled I
through, regained no small portion of |
the confidence which it had had prior |
TO the panic, and. a little less than two /
years after the panic, was paying divi- /
dends at the rate of u per cent. had |