Evening star., 1933-10-08
Suit Against Treasury to
Force Reopening to Be
Heard Tomorrow.
O'CONNOR CONSIDERS
NEW CONSERVATORS
United States Savings Bank Action
Said to Be Delaying Appoint
ments-21 Banks Open.


reopening of his bank under the Cooper
plan will come up for hearing in Dis
trict Supreme Court tomorrow morning.
The Treasury previously had reject
ed a plan presented by Col. Cooper for
| reOpening the savings bank alone, de-
claring it was not sufficiently fair to
depositors. The Treasury offered an
alternative, which Col Cooper rejected.
Meantime the depositors of the bank
at mass meeting Wednesday night
at Central High School auditorium
chose a Depositors Committee of seven
| to take steps to reopen the bank as
soon as possible. This committee is
| not officially a party to the suit, but
| will watch developments carefully. 1t
already has had one long conference
with Treasury officials.
The United States Savings Bank was
| dropped from the Hamilton National
Bank merger during litigation brought
| by Col. Cooper to prevent the sale Of
assets of the savings bank to the new
merger.
/ Conservators Busy.
| Meantime conservatorS of banks here
| in Washington continued with their
/ efforts to lquidate assets in a friendly
| and orderly manner to realize funds
! for depositors.
| In the case of the seven banks which
are members of the Hamilton National
| Bank merger, conServatOrs now are
, working on the problem of paying of
| the banks obligations and realizing a
dividend for depositors. DepositorS in
| these banks already have received one
payment of so per cent, made available
either through the Hamilton Bank or
direct from the conservators. It was
! freely predicted in official quarters last
/ y1iol1f rhat hn Vivid 70 do
! positors in these member banks cannot
be paid before 1884. Many problems,
| including the repayment of loans to
the Reconstruction Finance Corpora
| ton. face the conSerVatorS. The r. F.
c. loaned member banks Of the Ham
ilton total of more than $4,000 900,
! and it is understood these loans must
be repaid before depositors can realizc
another dividend
Among the undecided problems j.
member banks Of the Hamilton are ne
! conServators for four of the memb-~
banks Four men were taken over b
| the Hamilton Bank and have bee
designated as officers in the new inst
| tuition. but under law are still serving
as conServatorS of their own inStitu-
I, tons until relieved by a successor.
Controller of the Currency j. r. T.
! O'Connor IS understood to have the
problem Of appointing their successors
/ personally before him. but no indica-
ton as to whom he intends to name
has been forthcoming.
1t is known that one of the recon-
mendations made is that A P. Lochte
! succeed Joshua Evans. ir.. as conserva-
! tor of the District National Bank.
Evans was named vice president of the
| Hamilton. Lochte has been with the
| District bank for IS years, having
| served first as a bookkeeper. and been
promoted to cashier. He is assisting
Evans now in the conservatorship.
For some reason, it is believed in cer-
| tain quarters that the Treasury will
| delay naming new conServators until
after disposal by the court of the case
OF the United States Savings Bank In
this case. Col. Cooper raised serious
objection to Wilbur H. Zepp. vice presi-
! dent and conservator of the savings
bank, selling assets OF the Hamilton
Bank. in which zepp already had been
selected to be branch manager.
Whether the Treasury fears some ac-
ton might be taken by persons inter-
esteC in the four member banks of the
Hamilton whose conservators are goinv
over to the merger, has not been dis
closed.
Merger Negotiations
NcSOl1dO1OllS are way 10 per-
feet the plan for merger of the un.
licensed Mount Vernon Savings Bank,
and the Washington Mechanics Saw
ings Bank, which is now in its twenty
seventh year of successful operation.
The general merger plan provides
for purchase by the Washington Me-
chanics of sufficient assets of the
Mount Vernon to pay from 35 to As
per cent to depositors through the Me-
oh hn s,,,r L.
turned over to trustees Capital stock
of the Washington Mechanics would be
increased by 100000
Negotiations also are under way for
reopening the Franklin National Bank.
alone. but some details of the agree
ment remain to be settled. Of most
interest to depositors is the fact that
the newest proposal would relieve them
of the necessity of paying 10 per cent
would make available in cash to them
10 per cent instead of the previously
planned 60 per cent of deposits.
At the Park Savings Bank. where
a shortage of about S2,250,000 has
mounted since Robert F. Stunz COM
mitted suicide on March IA. when the
bank failed to receive its license. the
Depositors Committee has pending IN
court complex case designed to re-
| COVct lOSSeS llOiIl Tic ulltClUlS anu
stockholders. Hearing of this case has
been postponed.
The Industrial Savings Bank late
last week laid plans to formulate pro-
gram for reopening. w. NJ. Taylor.
national bank examiner. has been as
signed by the controller of the currency
to cooperate with the Reorganization
Committee of the bank to build up an
acceptable plan.
The bank situation in Washington
has been greatly changed since last
July. when four institutions went into
receivership. The Commercial National
| went into the hands of receiver Feb
| ruary %, and On the morning of March
IA, at the close of the bank holiday,
13 Washington banks were unlicensed
and placed in the hands of conserva-
tors.
At the present time, receivers are in
charge of six banks here, and con-
servators are handling at least part
of the assets Of IL banks.
Thus the number of separate banking
institutions in this city has been reduced
by gross of 18, which in reality is net
| of II on account of the addition Of
the new Hamilton National Bank, a
merger of seven members. There are
now 81 open banks here.
| OF the banks in receivership the
Departmental Bank has paid 65 per
cent. of deposits; the North Capitol
Savings has paid 1872 per cent; the
International Exchange Bank, has paid
1921 per cent; the Bank Of Brightwood.
has paid IS per cent; the Commercial
National ,has paid 20 per cent; but;the
Park say6gs has not yet paid anytA,z.