Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-05-23
STATE RANK 11ou1DA1rNG.

fhs nneDthly statement issued " the Bank Of North
Dakota when compared with previous statenents indi.
Gates with the sate insdtuhon II undergoing 4 process Of
Liquidation At the rate Of something nike . million dollars
q month. It this were continued it would not be long
before the affairs Of the bank were entirely wound UP.
1t cannot be continued indefinitely however because Of
the fact that q considerable share Of the banks aasets are
tied up IN investments which cannot be realised on for
some time, In some Cases for many years.
The officers and sponsors of the Bank Of North DE-
kota have persistently maintained that the bank was suf-
1er1ng from q boycott organized among the Independent
bankers Of North Dakota and eastern states for the de-
hberate purpose OF putting out of business . publicly
owned institution which might become an announcement
competitor for business which they desired to monopo-
lie. 1t Is to these alleged facts that all the oonplica-
tons which have arisen in connection with the Bank
OF North Dakota are attributed. The claim is entirely
false. There is no boycott against the Bank Of North
Dakota or the state Of North Dakota. There is, however.
a very pronounced disposition on. the part of prudent
business men to refrain from risking their own money
and the money Of their clients in an institution as IN
capably managed as is the Bank Of North Dakota. Be-
cause many men felt this way about it, and acted on their
convictions, there is an appearance Of concerted action
upon which the charge Of conspiracy is made.
II the officers of the state bank had conducted It's
affairs in 4 businesslike way from the beginning there
would have been no trouble. no Inconvenience. There
might have been no law repeating the Requirement that
local public funds be deposited in the state bank, but il
that law had been passed, as it has been passed, 1t would
have created no panic and no appreciabie inconvenience,
because the transfer Of funds could have been accom-
plished without embarrassing either the local communi-
ties local banks, or the state institution. The bank
officials, however, Immediately upon the organization of
the bank proceeded to follow a course directly contrary
to every principle Of sound banking, and certain TO result
in. the tieing up Of public funds indefinitely. regardless
Of any legislation which might be enacted. State bank
money wAs deposited in local banks which were organ
lied on . political basis and which we're known to be
insecure, and this was done solely for the promotion Of
political obtects. Local tax funds needed for current
expenses, levied and collected for that purpose, which
the officials knew would be required within a few
months-in many eases, within a few weeks-were In
vested In long time farm loans where the investment
could not be realized upon until the loans natured. 1t is
this kind Of banking which got the state institution into
deep water, and it IL because the officials have persisted
in this course that the demand has arisen for their re-
moval from responsible positions and for the withdrawal
Of the Bank Of North Dakota entirely from the field Of
commercial banking, into which it should never have
entered in the first place. ~ E