The Hope pioneer. [volume] (Hope, N.D.) 1882-1964, 1919-10-16

Total Observation-Disclosures
Taking these excessive lines up In
detail, will say that the >Consumers
Uniaed Stores line, is secured by
S375, 0OO. 900 of farmers notes. I did
not check up this collateral, although
1 feel that this should be done. But
was assured by the cashier that this
was the correct amount as he has
checked same since the first OF the
year. This concern is further direct
ly liable to the bank on a note by the
Federal Development Company for
IS ,675.71, and endorsed and guaran-
teed by the Stores Company. Their
liability on this note is admitted, and
as the Development Co., is not con-
sidered responsible, this note should
be added to the Stores Co, line.
1t is needless to state that this line
of credit is entirely o large regard
less of the value of the collateral. 1t
appears to me that a bank with u
$50, O0O. 900 combined capital and sur
plus should not be permitted to car
~ a line so grossly excessive. 1t IS
true that this line is made up of num-
bers Of notes signed by various differ
ent individuals, and that each OF these
notes is within the banks limit, but
it is admitted by the officers of the
Stores Co., as well as the officers of
the bank, that these signers are pure
Nv and simply accommodation sign
ers and that the liability and the
whole of the same belongs TO the
Consumers Stores Co.
The N. p. League liability is secur-
ed as follows, viz: $2,619.7S is said
to be secured on post dated checks
~aggregating $3.50, 00O0. 1000. This collat-
eral was not verified. The balance, or
$50, 100000 is secured by warehouse or
Storage receipts issued by the Cen
trail Warehouse Co., of st. Paul, for 50
Ford carr stored with them, and ire
insurance policy for s~23,500.O0 is held.
The same argument holds good re-
garding this line as the Stores line.
only this line is much less excessive.
The Agricultural College line is un-
secured. The ultimate value OF this
loan is not questioned, but the line
is entirely too. large for a bank OF
this size.
The Peoples Coal company line is
not only excessive, but should be
wholly removed, as the credit is NOT
warranted by the standing of the
concern. It is classed as poor paper
and should be ordered out. Part of it
is endorsed by Kimball and Deemy
but a large part Of it without secur-
ity. See Directors resolution.
The United States Sisal Trust is a
concern hat little is known about:
the entire line is without security
except that part of it is endorsed by
]. j. Hastings. which does not i'm
prove it's standing. The whole line
should be removed. See Directors
resolution to this effect.
Tho NJ < 1oor &c q 1NNo1 70 vpo arc
elevator and is endorsed by several
farmers, including o. K. Hanson who
is a director of this bank. This loan
should be reduced to banks loan linn
it and put in good standing by re-
newal as same is past due.
The No. 6 line should be reduced to
loan limit. This concern is not strong
financially, but bears Il good reputa-
ton, and is backed by men Of fairly
good financial responsibility. The
larger part of this is personally en-
dorsed by these men.
p. R. Sherman is cashier of this
bank. 100000 of this is secured by
similar amount of Bickle-Killo Co.
bonds, balance is unsecured. This is
considered a poor loan, and a COM
plete removal would be desirable, but
at least a very material reduction
should be insisted upon. Mr.. Sner-
man is further liable to the bank as
an endorser or a note of w. r. Whit
ney for $780, 90. maker is not known,
nor his standing.
A. NJ. Grosvenor; this is a poor loan,
although it is believed that the ulti-
mate value Of the security is ample to
protect the bank. But it is and going
TO remain slow. undesirable and top
heavy loan. Reduction to loan limit
should be insisted upon.
The No. 9 loan is o considered
first class. At least reduction to loan
limit should be required.
II. D. Haggerty, Mpls. In onnec-
ton with this loan will state that the
bank carries line a%ggregating $47,-
10000 for the Hagg.rt runcer,s and
his associates in business, as follows:
~. u. Haggerty. personally, &c. OO. 90;
III. D Haggerty. Inc, $500. 90; Great
Western Live Stock Co., $4,5OO.O 90; G.
T.. knaack. $1O,OOO.OO; Warren H.
Reck. $4,000, and E. M. Rulings,
$7,5OO.OO. This whole line is secured
by $2O,000.00 collateral notes and the
bank holds $42,5OO.OO of gold bonds
issued by the Livestock Company, on
a trust or escrow mortgage for $685.
10000 upon a tract Of land in the
state of Michigan. The collateral
notes are signed by four makers for
100000 each and are all past due
and do not look good. All of this
paper matured on April LIST, and 1
would recommend hat this whole line
lie collected or removed. See direct
ors resolution which l believe was in
to cover this whole line.
l feel that if the foregoing recon
mendations in this report are carried
out or even a substantial part thereof,
That Il good deal has been accomplish
cd towards putting the loans of this
institution, in Il fair condition.
None OF the loans to officers and
directors have any record approval.
Ihls approval should be required.
Respectfully submitted.
y. f.. HALLDORSON,
OcnutX Rank EXnminor