The Bank Failed, but the Panic Didn't Come
When Merchants' National Bank closed in 1895, depositors lined up, then went home reassured. The real scramble was for the receiver's job.
A round of the various banks in the city yesterday showed that the failure of the Merchants' National Bank has had no perceptible effect on their depositors, whose confidence in the stability of their individual bank appears to remain unshaken. A few timid people called for their deposits, which were paid with such alacrity that many of them returned later, shamefaced, acknowledging that their alarm was groundless.
Around the Merchants' National Bank all was quiet, with nothing of the excitement that usually attends the closing of a moneyed institution. A few depositors kept coming in during yesterday inquiring as to the safety of their deposits, and the reassuring words given them by Cashier Harry Meserve seemed to have the desired effect, as all left satisfied that by a short delay every cent due would be given them. Business men feel equally confident that the result of this failure will have no material effect on trade or check the advance of the growing good times. The bankers best qualified to know the condition of the Merchants' National are firm in their convictions that every depositor of that bank will be paid in full, and eventually the stockholders as well. In other words, the general confidence in the community remains unshaken.
The bank examiner has not yet arrived to take charge of the bank, but is expected in a day or two.
Although it is not the intention of the bank to go into the hands of a receiver, but to liquidate without the delay incident to a receivership, applications for that position are already beginning to pour in on Comptroller Eckels, as the following special despatch shows:
"Washington City, May 22.—Many telegrams were received today by Comptroller Eckels from residents of Seattle, who either want to be receiver of the Merchants' National Bank or have some friend they would like to get into that place."
It is by no means certain yet that the bank will be able to reopen for business. If it can, it will be very encouraging to depositors to do so. Comptroller Eckels has often spoken in praise of the bankers of Seattle, who stood so nobly by their banking institutions during the panic, and now speaks with confidence that so good a record has been broken.
“A few timid people called for their deposits, which were paid with such alacrity that many of them returned later, shamefaced, acknowledging that their alarm was groundless.”
Bank runs and receivership fights still dominate financial news; the 1895 story is a reminder that confidence is the real currency. It also shows how a local failure can become a patronage scramble before the doors are even closed.
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