The Bank That Quit the Nation
A Colton financial institution abandons its national charter, highlighting the struggle of small-town banks under federal mandates.
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.
Another national bank in the state of Washington—the First National Bank of Colton—has voluntarily surrendered its charter to become a state bank. Miles H. Miller, the cashier, provided three main reasons: First, the $50,000 capital requirement is too high for a small town; second, state banking laws offer reduced taxes and lower operating expenses; and third, national regulations place too many restrictions on loans, especially for the farming community. The national banking act’s rigid requirements, including those regarding real estate loans, make it difficult for small-town banks to remain profitable. As a result, fourteen banks in Oregon and Washington have recently abandoned the national field, and dozens more are in the process of liquidation, illustrating that the supposed high profits of national banks are often imaginary.
“A bank cannot live on $470 a year. It must have a chance to do business at a profit, and this is not permitted by the national banking act.”
This 1900 report on the 'First National Bank of Colton' pivoting to state status highlights the enduring tension between federal oversight and the practical economic needs of rural communities—a dynamic that still defines the struggle for local banking access in the Palouse today.
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