Preble County, Ohio - Chapter 14: Banks and Banking, 1915

Chapter 14: Banks and Banking

Banks, as known by all English-speaking people, in their methods of doing business and issuing credit-money and letters of credit, are of American origin.

In 1690 the Colony of Massachusetts, finding that the demands to meet the expenses that those strenuous times placed upon its resources were greater than the available supply of gold and silver would meet, evolved a system for its banks to issue credit-money, to a considerable amount. The issue was closely guarded and the bills made receivable for taxes and all public dues.

A canny Scotsman, named William Patterson, was then in Massachusetts, for some two years, and gave much attention to the study of the system. He went home and in 1694 organized and put in operation, along similar lines, the Bank of England, sometimes called "The Old Lady of Threadneedle Street," and he watched over it the rest of his life. So successful did it become that the world of business has ever since followed its lead, as being probably the best and safest banking system ever devised by man.

But banks are not by any means a modern institution. There are bankers' records from Babylon, back to the days of Sennacherib, 700 B. C., and many later. Then, before the Christian era, the system seems to have died out, having been followed by money lending and money changing by private individuals, probably because, with the swing of the conquering armies that swept over so many of the countries of the Old World, a man's money and valuables had to be kept so they could be readily carried away and hidden, for capital ever has been the first to hide, when danger threatens, and does so yet Hence, banks, being the accumulations of many scattered individuals, must have peace and safety for their protection. The first great commercial power to arise from the wreck and ruin that followed the collapse of the Roman Empire, was Venice, the island city, whose ships and commerce covered the Mediterranean sea. In that city in 1197 was started the first modern bank of deposit, and it continued for centuries.

The Throbbing Heart Of Business

The power of banks has gone on increasing, until today it may safely be asserted that banks are the throbbing heart that sends the life-blood through all the commercial arteries of every business. Banks, under our systems 6f exchange and clearing-hotises, have expanded their power beyond the dreams of the world's best bankers of a hundred years ago.

Our Preble county banks are linked, generally speaking, with the whole system in the United States, although, within the law, each is left independent in conducting its own business. We have in this county three systems of banks, national, state banks, and joint-stock or partnership banks, besides private banks, owned by individuals.

The national bank operates under a charter from the United States, and every stockholder can be made to contribute as much as the par value of his stock, if necessary, to pay the debts of the bank. It also may issue a certain amount of notes.

The state bank operates under a charter from the state, and the stockholders are under a double liability, the same as those of national banks. It also may issue its notes, but no one is, by law, required to accept them in payment. Such notes also are subject to a heavy tax by the United States, hence none are issued.

Joint-stock banks, or partnership banks, are really private banks, their money being the amounts paid in by the owners, and every member of the bank is individually liable for all debts of the bank, hence they are just as strong financially as the aggregate wealth of the individuals.

There has been but one bank failure in Preble county, and that was of a branch bank. The parent bank failed and took the branch bank with it. In the aggregate, the banking power of the county banks is much greater than our people have appreciated. A short history of each existing bank will be given, then a general view, to show the combined power.

In 1847, about one hundred and twenty-five stockholders organized, under the law of 1845, a branch of the Ohio State Bank in Eaton, with a capital of one hundred thousand dollars. This was the first bank organized in the county. For a time a room in the first house south of the court house, on

Barron street, was used as a bank, but later the bank was moved into a room on Main street. John M. Gray was cashier, and in 1853 he was succeeded by H. C. Hiestand. . In 1864 the bank was reorganized into and became the First National Bank, with the same capital, Hiestand remaining cashier. In 1867 the Brooke Brothers bought Hiestand's interest, and John C. Brooke became cashier, he being succeeded by C. F. Brooke, Jr.

In 1884 the twenty-year charter expired and was surrendered. The bank then reorganized under the state laws as the Fanners and Citizens Bank, with Joseph Cramer, president, and C. F. Brooke, Jr., cashier, and so remained until Cramer's death in 1901, when it merged with the Eaton Banking Company.

The Eaton Banking Company was organized under the state laws in 1892, with Edward S. Stotler, president, and J. H. Musselman, cashier, with a capital of one hundred thousand dollars, and started business in the corner room at the northeast corner of Barron and Main streets. This bank was continued as a state bank until 1901, in which year it was merged with the Fanners and Citizens Bank, under C. F. Brooke, Jr., and the two continued under the name of the Eaton Banking Company. In 1903 the bank moved across to the northwest corner of Barron and Main streets, and on January 10, 1905, it reorganized as the Eaton National Bank, with a capital of fifty thousand dollars, which later was increased to sixty thousand dollars, with S. Swisher, president, and J. H. Musselman, cashier. This bank has deposits of over six hundred thousand dollars and surplus and undivided profits of fifty thousand dollars. The prime movers in the organization of the Eaton Banking Company were E. S. Stotler, J. H. Musselman, J. M. Gale, S. Swisher, Harvey Paddack, A. A. Leas and George Deem, the last three of whom have answered the last roll call.

The Preble County Bank was organized as a bank by H. C. Hiestand and others, with a capital of one hundred thousand dollars, in October, 1873. A brick building, solely for the use of the bank, was erected by J. H. Foos on the north side of Main street, about one-half square west of Barron street. The organizers of the bank, being men well and favorably known in the community, the institution soon acquired a large clientele, which it has held.

In 1888 the bank was reorganized as the Preble County National Bank, and was reorganized in 1908, H. C. Hiestand being president from the first organization of the bank to the time of his death on July 5, 1884. In 1892 the Ortt company erected a large brick building at the southwest corner of Barron and Main streets and prepared three rooms in this building for bank purposes. When the building was completed in 1893 the bank moved in and has since continued to occupy the corner.

Since the death of H. C. Hiestand, Joseph V. Acton has been president, and A. J. Hiestand i# the present cashier. The bank's present capital is sixty thousand dollars; surplus and undivided profits, one hundred and four thousand dollars, and deposits, one million sixteen thousand dollars.

Banks At New Paris

The Fanners Bank of New Paris was started as a private bank in 1889, by Horace G. Bloom, with a capital of thirty thousand dollars, the village never before having had a bank. Seeing similar conditions prevailing in the villages of New Madison, in Darke county, and in Eldorado, Mr. Bloom, a year or so later, started branch banks in both of those villages, which hq successfully conducted until his death about the year 1906. In the meantime he had taken in with him others, and the banks were operated as joint-stock banks under the state law.

After the death of Mr. Bloom, the New Paris bank was taken over by his partners, and is still operated as a co-partnership bank, with a capital of ten thousand dollars, with S. C. Ritchie, president, and E. C. Mikesell, cashier.

The First National Bank of New Paris was first started about 1900, as a private bank, by J. A. Peele, and was run by him as a joint-stock bank until his death, May 20, 1908, during which time it was called the Peoples Bank. After the death of Mr. Peele the co-partners, on August 8, 1908, took over the bank's assets, assumed the liabilities and reorganized the bank as a national bank, with a capital of twenty-five thousand dollars, divided into one hundred dollar shares, since which time J. A. Garretson has been president and M. H. Pence, cashier. It has surplus and undivided profits of two thousand five hundred dollars, and deposits of sixty-three thousand dollars.

Up to 1887 there had been no bank in the county except at Eaton, and many business men at West Alexandria chafed under their disadvantages. Finally, in December, 1887, S. S. Black circulated a subscription for shares in a new bank, and in just half a day the paper held the names of S. S. Black, E. S. Stotler, J. M. Gale, P. Smith, J. N. Clemmer, John Fadler, J. E. Davis, A. Unger, Herman Voge, J. Rinck, Joseph Markey, J. H. Markey and Joseph Mills, just thirteen.

The bank was incorporated under the state law, as a joint-stock bank, and was called the Twin Valley Bank, S. S. Black & Company, with a capital of twenty-five thousand dollars. It was organized on January 2, 1888, and started business on Main street in the building at the northwest comer of Dayton and Main streets. The bank prospered from the first, and the company later bought the building at the southeast corner of the same streets, fitted up the corner for a bank and has occupied it ever since. The bank has surplus and undivided profits of fifty thousand dollars, and deposits of about five hundred and seventy-five thousand dollars. S. S. Black is president and Lew Derby, cashier. This extended account is given because this was the first bank to break away from the county seat. In 1906 the Twin Valley Bank established a branch bank at Gratis, with N. G. Kimmel as cashier.

The Farmers and Citizens Bank, of West Alexandria, was started on March 14, 1905, as a partnership, or joint-stock bank, by Henry Meyer, R. J. W. Ozias, Sherman Mills, Jacob Urich, J. A. Rosillius, J. H. Ehler, Sr., and fifteen others. This bank began business on the south side of Dayton street, with a capital of fifty thousand dollars. It reported to the auditor in 1914. surplus and undivided profits, eight thousand dollars; deposits, two hundred and twenty thousand dollars. R. J. W. Ozias is the president and Sherman Mills is the cashier. This bank was organized and is operated under the state laws.

Bank Failure At Camden

In 1893 the failure of the Camden bank left Camden without banking facilities, and in 1894 some thirty of the citizens of the village and vicinity started a joint-stock bank, under the state law, called the Commercial Bank of Camden, with a capital of fifteen thousand dollars. It accumulated a fair clientele, but, not proving satisfactory, a number of the citizens of the village and community formed an organiation, bought out the Commercial Bank bodily, and in July, 1906, reorganized the bank as the First National Bank of Camden, Ohio, with a capital stock of fifty thousand dollars. This bank has surplus and undivided profits of fourteen thousand dollars; deposits, two hundred and eighty thousand dollars. A savings-bank account is operated in connection. The bank occupies the building at the southeast corner of Main street and Central avenue, which it rents. R. C. Prugh is the president and J. E. Randall is the cashier.

The farmers' Banking Company, of Eldorado, was organized by Horace Bloom, in 1899, as *he Farmers' Bank, a branch of his New Paris and New Madison -banks, and as a private bank. At Mr. Bloom's death the bank was taken over by his partners, and so continued until 1913, in which year it was reorganized as a joint-stock or banking partnership, with a capital of twenty* five thousand dollars. It now has surplus and undivided profits of six thou* sand dollars and.one hundred and sixty thousand dollars deposits. It owns its own building on the east side of Main street. Isaac Miller is the president and C. D. Miller is the cashier.

The Farmers .and Merchants Bank, of West Manchester was organized in 1897 as a banking partnership, by J. E. Leas and J. W. Leas, with a capital of ten thousand dollars. In .1914 it reported to the auditor that it had, surplus and undivided .profits, twelve thousand dollars; deposits, one hundred and fifty thousand dollars. John E. Leas is the president and J. W. Leas is .the cashier.

The Farmers Bank, of Verona, was organized in 1906, as a banking partnership, by S.'G. Sheller, John Werts, A. N. Rife, John W. Kreitzer and E. E. Niswonger, under the state laws. It has erected, at the northeast corner of Main and Mill streets, a bank building of 'Grecian architecture, solely for bank use, equipped with modern appliances. Capital stock, .fifty thousand dollars ; surplus and undivided profits, six thousand dollars ^deposits, two hundred and fifty thousand dollars. The capital stock is divided into one hundred dollar shares and is held by many of the farmers and business men of the community.

Chicago Bankers In Trouble

The People s Banking Company, of Lewisbuig, was started as the Citizens' Bank by some Chicago people. After running but a few years the bank had some trouble, and in 1897 a number of men, headed by L. F. Parmerlee,

H. P. Smith, A. T. Horn, L. Finney, E. C. Crider and S. G. Sheller, formed a banking partnership and took over the bank, which, in 1908, was reorganized and incorporated under the state laws as a state bank, with a capital of thirty thousand dollars. This bank built and owns a fine bank building on the west side of Greenville street, used and fitted only for banking purposes. It has surplus and undivided profits of eight thousand, five hundred dollars and deposits of two hundred and seventy thousand ollars. H. P. Smith is the presient and Waldo C. Moore is the cashier.

the Ohio side, about thirty feet south of the county line, and one on the Indiana side, about twenty feet west of the state line, whose combined assets are over a half million dollars, a considerable part of which comes from this county, which banks are not accounted for herein.

Recapitulation

Every bank of the county was visited and only questions asked as to their history and the above items. The figures given can be relied on, therefore, as showing the present condition of each bank, except, as otherwise stated in the history.