The New York herald., 1921-12-30
BANK HERE CLOSES;
DEPOSITORS PROTECTED

After two hour run by excited de-
positors on the Italian Discount and
Trust Company at 399 Broadway and
its Harlem branch at 2242 First avenue
yesterday forenoon both places we're
closed by order of George V. McLaugh-
lin, Superintendent of Banks for the
State of New York.
Most OF the depositors of Italian ex-
traction became alarmed early in the
day when word was received that the
Banca Italiana di Sconto had closed fits
doors after the Government announced a
modified moratorium permitting the sus-
pension of payments pending court pro-
ceedings. The local institution has large
deposits in the Banca Italiana di Sconto.
Emanuel Gerli, president of the Italian
Discount and Trust Company, cabled
from Milan yesterday that the Italian
Government would protect the foreign
interests of the closed institution, which
has about 900 branches in Italy and cor
respondents in almost every foreign
country.
Giovanni Girardon, vice-president of
the local trust company, said he had
reason to believe that everything would
be Strengthened out here, but the out
come would depend largely upon the
settlement OF the affairs in Italy. He
would not state the amount of the trust
coDlpany's funds involved in Italy except
to say that II was large.
The Italian Discount and Trust Com
pany has about 5000 depositors, includ-
ing 1000 of the poorer class In the Har-
lem branch. The institution has a cap
ital of s1,000,000 and deposits OF
$12.000,000.
So severe was the run on the COM
pany after its doors had been open for
an hour hurried meeting of the board
of directors was called. For time II
looked as II the bank would not have
to suspend payments, as funds were re-
ceived from downtown institutions. After
a conference with Superintendent OF
Banks Mclaughlin. the board of Direc-
tors asked that the trust companys af-
fairs be taken over by his department
Later the doors were closed. At the time
there were between 100 and 200 depos-
itors waiting In line In the Broadway
office demanding that they be given their
money.
The run on the Harlem branch was
not so heavy. and 1t was not until the
doors we're closed that word was spread
throughout Little Italy that payments
had been suspended. Then came Italians
of all ages. including men, women and
children.
w. C. Potter. president of the Guar
anty Trust Company, last night said the
closing of the doors of the Italian Dis
count and Trust Company was due to the
failure of the Banca Italiana di Sconto
to pay Its lire claims. In other words,
the Italian concern had been investing
heavily in exchange.
Italian exchange. already the weakest
of the Allied remittances in the local
market. closed at 4.21ih yesterday, just
liz points lower than before the re-
ccipt of the news of tho closing OF the
Banca Italiana di Sconto. Mr.. Potter
said
Due to the fact that the Guaranty
Trust Company had former interest in
the stock OF the Italian Discount and
Trust Company. purchased at the time of
it's organization. two officers of the
Guaranty Trust Company have occupied
positions on Its board of directors. In
April last the Guaranty Trust Company
sold it's entire holdings in the stock to
the Banca ItaIiana di Sconto at prem
ium above cost and since then has had
no interest in it's business The Italian
Discount and Trust Company has no in
debtedness to the Guaranty Trust Com
pany:- On the contrary. the Guaranty
Trust Company carries credit balance
from that institution"