Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1922-02-07
FORMER ND.
HEADSkNEW OF
BANK LOSSES
Letter Signed BY cathro
Suggests High Interest
j.. Rates On Bonds

dustrial Commission to the effect that
the, Bank of. North Dakota has lost
more mons than any state industry
established by the Nonpartisan ms. came
as a shock in some quarters.
It doubtless was no surprise to Tor
mer manager and director-general F..
w. Cathro. nor to former Governor
Lynn j. Frazier, former Attorney Gen.
oral William Lemke or former Com
missioner Of Agriculture and Labor
John N. Hagan.
The Industrial Commission was in
formed on March 8, 1921. just after
The legislative session adjourned and
months before the recall election, that
the bank was losing money. The con-
dition of the bank was known to for
mer Governor Frazier n others while
they were making campaign speeches.
A paper labelled Condensed Sug-
gestions Relating to the Selling Of
Bonds. and bearing the name Of r.
w. Cathro and the date March 8,
1921 was found in a box containing
propaganda stories n a mass of data
relating. to the bond sale campaign in
h former office Of VIM. G. Roy
lance, publicity head Of the bank un-
der the former regime.
Cathro's Advice F.
In this paper Mr.. Cathro said:
Eve must keep in view hat we
must not have the bonds bear more
than the present rate Of interest al
below par; that we must not permit
the capital of the bank to become i'm
paired through excessive commits
sions: that we must nave some re-
serve to offset unforeseen losses, as for
fexample, the bank at the present time
is operating al a daily loss. Our in
terest receivable is not equal to our
interest payable plus expenses at this
time. To justify our existence we
must show and maintain a profit; con-
s%equertly we must increase our in
terest rate on ~receivables proportion
ately." %
The last paragraph OF the paper
which contains an exhaustive analysis
OF the bond sale program then just
j under way and tabulations regarding
the issues Of bonds. reads:
"The foregoing prospectus was pre-
pared for the members Of the Indus
trial Commission for persual and sug.
gestions and was submitted to then
on March 8. 1921, and has their ap.
prevail"
Refers To Thompson
Reference to Car. D.. Thompson
former member of h Socialist ma
tional Organization and now active il
the Public Ownership League, VIII.
received considerable sums in h bono
sale campaign, is contained in tn
prospectus, Mr.. Cathro said:
Carl D. Thompson cannot do any
thing in any other line Ct work tina
will equally promote the aspirations o
th4sGPublic Ownership League as sell
reason he should bend every possible
energy toward the sale OF these bonds
even though the Public Ownership
League did not receive one cent o
compensation. The putting across o
this program will have done more t.
foster their hopes and ambitions tina,
can be done in any other activity nov
being considered by them. Neverthe
less. we are willing to compensate
them to the. extent that this portion
Of. their work should be s~elf-sustain
ing"
The prospectus contains an elabor
ate table, dated February, 1921. re
garding the bond issues, rate Of inter
est, commission. etc. The commits
sion listed ranges from 1.63% t.
3.40%. The table lists the following
series; 100000 real estate n mil
and elevator series, total $5,950,000.
places the commission on the banl
series at .$38,034; real estate series
$92, o. 900; mill and elevator series
$685.; total commissions to be pail
by the bank $13o.126.50: total codm
missions to be paid by Industrial Com
mission, $ao,525.
The prospectus suggested variou
means for consolidating all effe rts OF
the bond sale and avoid duplication o
effort. 1t suggested methods for con
centrating a. $4,000 advertising fund
suggesting the Christian Science NJ
tor. Christian Herald and The New
Majority. and adds that 1.-The Nationa
Nonpartisan Leader should not b.
overlooked"