The Bank Failure That Didn't Break the County
Through diligent use of bonding companies and collateral, Benton County recovered every cent lost in the 1924 Citizens State Bank collapse.
The story, cleaned up
A cleaned-up reading of the newspaper page: spelling and layout repaired, one story lifted off a crowded page. It follows the original closely but it is not a transcription. The original page is below; read it if a detail matters.
According to Campbell W. Bushnell, prominent attorney of Prosser, the bonding companies have paid Benton County every dollar which it had on deposit in the Citizens State Bank when it failed on the 30th of June, 1924. Payment by the bonding companies included interest on the entire amount from the date of the bank failure. When the bank failed, treasurer Ivan Macy had on deposit in the Citizens State Bank $114,729.24. Added to this was a cashier’s check for $15,075.24 which had been transmitted to New York to pay interest on the Richland Irrigation District bonds, making a total of $129,804.24. The amount of the depository bonds carried by the bank was only $60,000. In addition to this, Treasurer Macy held government bonds and other collateral owned by the bank in the amount of $25,828.51, leaving $43,828.51 unsecured by the bank. In making the settlement, the county collected the $60,000 depository bonds, converted the collateral security into cash at its full face value, and collected the balance of some $43,000 from Treasurer Macy’s bondsmen. The liquidation of the accounts was made without litigation and at very small expense to the county.
“The liquidation of the accounts was made without litigation and at very small expense to the county.”
Bank failures were a recurring anxiety in the early 20th-century Pacific Northwest, often leaving communities stranded. This report reflects a rare, successful institutional recovery that stands in stark contrast to the common experience of total financial loss during the era's frequent banking panics.
From readers
No comments yet. If you know something about this story — a correction, a family memory, a source — it belongs here.