The independent. [volume] (Elizabeth City, N.C.) 1908-1936, 1929-08-23

The Carolina Bank was not in
solvent and depositors will not lose
a dollar. But the Carolina Bank
has been a losing venture from its
inception in Oct. 1921. In only one
year did it make profit and out
Of this profit it set aside a surplus
of $500 which still appeared in its
statement of June 30, 1929. Stock
holders had never received a diyid-
end.
At the close of business as Of June
30, 1929 the bank had loans out
standing to the amount of SSOl,-
678.80 with deposits amounting to
$725 ,86431. A depression followed
the failure of the sections big money
crop, Irish potatoes. Borrowers
could not repay their loans. De
posits shrunk. Deposits fell of
Sl21, ,39O.64 between June 30th ami
August 10th.
More than a month ago the Off
GERS of the institution agreed among
themselves that the bank would
never pay dividends and that
steps should be taken to merge with
: some other bank. Negotiations were
opened with the Savings Bank G5
Trust Co. of this city.
The President of the Savings
Bank g. Trust Co. is p. II. Williams.
Mr.. Williams is a shrewd but carti-
ou5 citizen j. w. Foreman. w. p.
Duff and r. E. CheSson were Sug-
gested as committee from the Say
ingS Bank to open negotiations
with a committee from the Carolina
Bank. But week passed and moth
ing was done. Mr.. Williams then
suggested that, inasmuch as one CT
the branches of the Carolina Bank
was In Hertford, there should belay
Hertford man on his banks COM
mite. T. 8. White of Hertford was
named. Still, no move toward
merger was made and the officers
Of the Carolina Bank then ap-
preached the First g. Citizens Ma
tional. BY this time the directors Of
two banks were aware that the
Carolina Bank was seeking to dis
continue business. Many of the
directors didn't know what it was
all about. An impression got out
that the Carolina Bank was insol-
vent. Wild reports of the banks
insolvency seem to have originated
in Hertford and one citizen of Hert-
ford telephoned to Elizabeth CITY
that he had inside information that
a crash of the Carolina Banking 81
Trust Co. was imminent. If this
report had become general there
would have been a run on the bank,
with disastrous results to its de-
positors. 1t was then that the Bank
Examiner was called in and the
bank closed pending the ncgoti-
ations with the First g. Citizens Ma
tional.
But for the premature ruanOrs OF
the banks failure, the Carolina
Bank would in all probability have
been quietly taken over by the First
g. Citizens National and its de-
positorS would never have been in
convenienced. As it was, a dis
a5trous run on the bank and panic
were narrowly averted.
Much Unfair Talk
The Carolina Banking g. Trust Co.
was the pet project of DR.. n. i.
Pendleton, Elizabeth City whole
Gale druggist and chairman Of the
Elizabeth City Public Utilities Com
mission. DR.. Pendelton organized
the bank and personally sod most
of the original capital stock of $780,
900. He purchased actually So
shares of the stock, II shares for
himself, IS for his wife and 15 each
for two minor daughters. Or. PEN
dleton has been president Of the
bank since it was organized in 1921.
There has been much criticism Of
Dr. Pendleton and many ugly stories
have been told to discredit him. u
is said that he anticipated the fail
TIRE of the bank and had unloaded
his stock and removed his account
to another bank. Neither of these
reports were true. The books show
that he made a substantial deposit
in the Carolina Bank on Saturday,
Aug. 10th after the State Bank
Examiner had been called. He ana
his family still hold the original SO
shares of stock purchased by him.
DR.. Pendleton has served for eight
years as president Of the bank with
out pay.
Stockholders Optimistic
A number of the stockholders Of
the bank, interviewed by this news
paper this week, entertain no fears
of losing much by the closure. T4eir
stock had never paid dividend and
had sold recently as low as SO q
(Cortinued or regc IT,