Two Years in Limbo: Whatcom's Failed Bank
Depositors in the Columbia National Bank get only a sliver of their money back while the officers scatter — one to Honolulu, one to the shingle business — and the receiver's promises dissolve.
Whatcom, May 18 — Special — Some of the depositors in the Columbia National Bank complain bitterly about the treatment they have received from the government officials since the institution went into the hands of a receiver. Nearly two years have elapsed since the bank failed. The capital stock was $100,000. Upon the advice of the receiver the comptroller levied an assessment of [——] per cent before the first dividend to depositors was paid, thus releasing the stockholders from further liability, as the law provides that only one assessment upon the capital stock of a national bank can be made by the comptroller.
Last year the comptroller prescribed certain conditions under which he would terminate the receivership and consent to the reopening of the bank. Cashier Baker went East and succeeded in raising in Baltimore the amount necessary to comply with the comptroller's conditions, subject only to the approval by an agent of the men who were to furnish the money, of the security offered, which was entirely independent of the securities of the bank. Baker had returned and the agent of the Baltimore capitalists was about to start for this city, when the comptroller, acting upon the advice of Receiver Blanchard and J. C. Lighthouse, withdrew his consent to the reopening of the bank upon the terms he had before named. The depositors organized and protested and asked for a new receiver, but all in vain.
President Watty removed to Honolulu with his family; Cashier Baker went into the shingle business, and the fire rooms formerly occupied by the bank were rented to the street railway company and Hugh Eldridge for office purposes. Mr. Blanchard went away some time ago and is said to be ill in the East, and the depositors are still waiting for another dividend and wondering where they are at. The Bellingham Bay National Bank, which suspended after the Columbia, has been in successful operation for over a year, and has even anticipated some of its obligations to depositors, and the Puget Sound Bank, the affairs of which were considered to be in the worst condition of any of the suspended institutions, was reopened several months ago and is doing a good business.
“President Watty removed to Honolulu with his family; Cashier Baker went into the shingle business, and the fire rooms formerly occupied by the bank were rented to the street railway company... and the depositors are still waiting for another dividend.”
When the Columbia National Bank failed, its depositors entered a years-long limbo of partial payments and broken promises — a dynamic that rhymes uncannily with modern bank runs and the scramble to reassure savers. The officers who quietly moved on while ordinary customers waited are a reminder that financial collapses are borne by the little depositor long after the principals depart.
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