The weekly times-record. (Valley City, N.D.) 1912-1922, 1919-10-30

! being called on to pay $2lO for shares
of stock for which the present stock
holders in the bank only were obliged
to pay $1O0.
The Observation-Disclosures bank,
when it closed, had a capital stock of
$4,000, and a surplus of $4,000.
There were 500 shares of stock is
sued, Of which 1877 shares are owned
! by the League Exchange Inc, cor
poration which under the banking
laws, is not legally qualified to hold
bank stock of any nature.
The 500 shares of stock, on the
basis of $4,000 capital and $4,000
surplus, would be worth $120 par, or
accepting o. E. Lofthus' statement
as correct that there is $11 900 in un-
divided profits, the aggregate book
value of the stock at the present time
would be $131 share.
| The farmers, however, are being
prevailed on to pay $21O, or a pre-
MUM of from $85 to 800 over the ac-
tual value.
AS the farmers put their money
| into the bank and create a surplus
this surplus can be used by the bank
in paying off bad paper. Already the
directors of the bank, according to
Lofthus' own statement to the su-
preme court, have made good with
their own money $4,000 worth of the
bad paper. The deputy bank exam
iner who went into the bank showed
I in their report to the state banking
board that $04,O00 of the banks
paper was in the hands of attorneys
for collection, and that many thou
sands of dollars of the banks paper
in excess Of the $25, 900 already made
good by the directors, should be
charged off.
By creating huge surplus COL
lected from the farmers, the leaders
of the league would put the bank in
such shape that the surplus could be
drawn on to make good any other
bad paper that must be taken care
of, of which the banking board has
declared there is considerable.
The whole success of the 100000
venture in banking finance now is up
to the slick statesmen and their
local "come ons." They must finish
the lob undertaken by the league
leaders, and they are already in the
field after the money.
o. E. Lofthus, state bank examiner,
still is being used by the league lead
ers to. put over their bank stock
deal, as is disclosed by the following
letter that Mr.. Lofthus has address
ed to ':patrons" of the Scandinavian
American bank: =,
5~ r "October %, 1919.
" '''To the patrons of the Scandina-
vian=A IN erican bank :@'a s,>s}-g. ~,
"I take this first opportunity to
present for your consideration the
facts regarding the Scandinavian
American bank.
"a great injustice was done to the
depositors of this bank as we'll as to
the directors and stockholders of this
institution.
II find not one thing to justify the
statements of Deputy Bank Examin-
er Halldorson in making his mali
cous and erroneous statements.
''One of my deputies, Mr.. Engemo-
en-, who assisted in the now infana-
Gus examination, made an affidavit
that Assistant Attorney General
Sheets made the untruthful state
ments signed by Halldorson and
Sheets.
"In the short time l have handled
the affairs Of this institution, over
1925, 900 has been collected and paid
in-nearly one-ffth of the total loans
and discounts.
"The banks total reserve today is
over $16O,O00.00 in excess of the
banking department requirements.
"The- Cash in Vaults reserve y, is |
many thousand in excess Of twice
the amount required by the banking |
department.
:'The bank is in a good liquid con-
dition, with aggregate assets of near
ly one and half millions.
ssIt is not only solvent, with it's
capital stock and surplus intact, but
has in addition accumulated prefits1
Of over $11, 100000. !: ~ |
Notwithstanding the notorious
publicity given to this bank by GER
tain newspapers, inspired only by
rank politics, I wish to advise you
than no depositor can lose one cent
or his ~or her money, for two. rea-
sons.
"First-That bank can pay all its
depositors.
guarantees all depositors full pay
ment Of accounts.
"The only suffering you can have
has already been meted out to you
that is, the Inconvenience you have
been put to in not being able to use
your funds and do your daily bank
ing with your chosen institution. /
s'This bank has the highest per-
centage of reserve of any state bank
/ have ever seen and therefore re-
commend your continuation Of pa
tronage to this institution which has
so strongly been able to meet and
tear down the political and com
mercial intrigue thrust upon it. 1t is
such strength that merits your
continued confidence.
81 very much regret, both as state
examiner and as citizen of North
Dakota, that such unmerited ex-
tremes should have been imposed
upon you. Hold responsible those
who chose such tactics and bear in
mind that the directors and stock
holders as we'll as myself appreci-
ate your very kind indulgence and pa
thence. I