Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1913-12-09
.BAYONNE BANK TO
REOPEN IN A WEEK
Pres. carragan Says That De-
positors Will Not Lose
a Dollar.
rspecIal to the Newsrl stsr.l

BAYONNE, Dec. 9.-Announce-
ments of the most reassur.ng nature
in regard to the financial condition Of
the First National Bank of this city,
which closed its doors yesterday,
were made by President George Car
ragan, of the bank, last night. Mr..
Carr agan insisted that depositors
would not lose a dollar OF their de-
posits and that the bank would re-
open in a week or ten days.
Mr.. Carragan stated that the bank
needed $S50,000 to restore 1t to its
feet and that one member of the
Board of Directors had promised to
deposit $269,O00 worth Of collateral.
while another promised to extend the
remainder. The closing of the bank,
1t was asserted, was a measure OF
precaution against the heavy runs
which would only have made matters
worse
Although throngs of depositors gath
cred about the doors of the bank yes
terday, there was not only no disorder,
but some even offered to prove their
faith in the bank by making further
oepos is. This, however. was refused
by Charles c. Chapman. "a nat onal
bank examiner, who is temporary re-
ceiver.
The closing of the bank, it was
| found yesterday, was caused by q
shortage in the cash reserve. The
bank had fallen about $50. 900 short of
| the 10 per cent. reserve requ red by
the federal law. It appeared that MT
Chapman had been working on the
books of the bank for the past two
weeks
The reason generally givnn for the
! financial embarrassment of the bank
is that the bank examiner had disap-
proved of many of the bonds which
| had been given as security for loans
| The bank Is the creditor Of many OF
| the mercantile houses of this place as
we'll as other cities, and Mr.. Chapman
| Is said to regard the assets notes as
/ of little or no value. The eSami~ er
also objected to the liberal policy
maintained in the past in extending
| loans.
Mr.. Chapman found that the depos.
! its of the bank amounted to $1.449.-
| 1851. There were 1000 depositors. OF
whom many were savings depositors
| The bank had loaned out about $780,.
| 900, OF which only about $4,000 were
demand loans. The average daily
outpayments were from $4,000 to $780,
900. The questionable paper amount.
ed to $3S9.000, and the examiner has
demanded that the directors replace
most of this amount with ready cash
The latter insists that the loans are
| good, but that 1t may take some
time to collect
The reorganization of the bank, II
was said, would necessitate the cleo
ton of a new staff of officers. II
being the contention Of Mr.. Chapman
| that the present officials were lax In
their methods of granting loans.
MIR. Chapman questioned the sta
bility of some of our loans extended
to out-of-town concerns" said Mr.
Carragan. Some of these are vel
known in the business world. He re-
fused. however. to grant the request
of the directors to be allowed to put
I'D cash of their own and take over
the criticised loans. l have no doubt
! that the bank will reopen within q
| week or ten days"
The officials of the bank, besides
Mr.. Cara gan. are William Fl. Vree'
! land and John G. RIVER. vice-presi
dents, and Louis B. Bragden. cashier