New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-07-13


saws $4,000 was charged Of two years
ago and the balance Just before the
merger with the Second National Bank
II Is asserted by Mr. Murray that
never during HIS administration was
there any report from a bank examiner
showing that the capital Of the bank was
impaired. He asserts that he had no
authority 20 close the bank when the re-
ports indicated that Il was solvent
He further declares that there were no
reports 70 the effect that false state
ments were published, the FIRST intimation
he had being cleaned from the recent
press accounts Of the failure.
Mr.. Murray's Statement.
Mr Murray In his statemen, says:
a few weeks before my term Of Office
expired a plan 20 consolidate the First
and Second National banks OF Pittsburgh
was laid before me.
"The papers presented 70 me showed
that tho board Of directors Of each bank
wanted 20 consolidate, that they had
gone over the assets Of the two banks
carefully. that they had agreed as 10
their value and had fixed on the valua-
ton OF stock In each bank as a basis OF
their going together To these papers
was added a letter from the bank exam
iner for the district recommending and
approving the plan. I gave the matter
careful consideration and approved the
plan Of merger
When ! became Controller. FIVE wears
ago. the First National Bank Of Pitts
hugh was under criticism The situation
was In the Office when went there. II
did not develop during my term. After
became Controller the bank was forced
TO charge of $4,000 losses. and just
before the consolidation the bank charged
on over $4,000 more. so that during my
term more than 10000 losses were
forced out of the bank That IS a tre-
mendous cleanup IN a bank OF that cap
ital and surplus and IT was done IN about
two years
After the FIRST charge-of OF losses Of
E..g01 the bank still had a capital Of
10000. a surplus of 10000 and some
undivided profits. Tie book value Of the
stock therefore. showed over so d share
In the report Of the examiner just before
the consolidation he estimated additional
losses Of 10000 and that amount was
charged out az the time the plan Of con-
so.ldation was made. The charge-on left
the book value around NJo-the basis on
which the banks went together.
There never was report from any
examiner during my term that ever
showed the capital Of the bank 20 be inn
paired. 7 could not legally close bank
when the report on II showed II 20 be
solvent There was never word from
any examiner during my term that any
reports the bank was making were not
correct reports and never heard Of such
thing either directly or indirectly until
read IL iu the press recently
Kane Also Makes Statement.
The Controller Of the Currency, T. T.
Kane. correcting a statement IN a local
paper N the effect that he had said that
President James S. Kuhn and Nice-Presi-
dent ". S Kuhn would not be prose
euted crimuallv made a formal state
ment this evening IN which he said in
part.
What h was intended 70 make clear
was that conclusion had not been
reached az % what prosecutions would be
begun and therefore that the report
that the Kuhns would or would not De
prosecuted was without foundation. II
was suggested that ~ statements were
made By the press 20 the effect that the
Kuhns would be prosecuted and II should
Subsequently develop that the department
had no sufficient case against them, inc
papers publishing such statements might
Be sued for libel
In the interview referred 20 no attempt
was made IN any manner 20 pass upon
the guilt or innocence Of the kuhns OF
any other director or official Of the FIRST
Second National Bank. nor was IT at
tempted 20 fx the responsibility for the
failure Of this bank before the complete
records had been received. That the BANK
was grossly mismanaged is beyond DOUBT
The report Of special examiners as 10
Indications Of criminal violations OF ia"
found In the First-second National Bank
Is now IN the course OF preparation by
such examiners. and will be referred TO
The Department OF Justice as soon as
authority 20 say what prosecutions VIII
% may be undertaken, and such intorma-
uon should come from tine Department OF
justice rather than from this Office
While the First National Bank OF
pittsburgh was known 10 have been IN
an unsatisfactory condition, the action
u the former Controller In approving It's
cancellation with the Second National
bank gave color 10 the presumption that
u trouble had been cleaned ~. and under
'he circumstances this office did not feel
Iusuned IN refusing 10 approve the First
second National Bank as reserve agent
'o' other banks. II was for the purpose
" determining what the true condition
@ that the examination Of the First
second National Bank by examiners
nam and Smith was ordered by me. and
we extent Of the losses and the inability
the directors and shareholders 20 make
uen good did not become known 10 me
-nui conference was had with the ex-
enlners and directors Of the bank In