(2 of 2)
Chase National 50,000,000
Manufacturers Trust
(Manhattan) 25,000,000
First National (Chicago) 25,000,000
$200,000,000
Last week the RFC had agreed to buy preferred stock (or capital notes) of 3,487 banks.
¶ George A. Ranney, once International Harvester treasurer, now acting as vice chairman and clean-up man of the ex-Insull Commonwealth Edison Co. of Chicago, who had been invited to chairman Chicago's Continental Illinois National (TIME, Dec. 25), last week wrote a letter to the bank's directors disclosing that: 1) the Federal Reserve Board had given approval for Mr. Ranney's election; 2) the RFC had been asked by letter for similar approval but had never answered. It was so evident last week that the RFC intended to put in Chairman Cummings of Deposit Insurance Corp. as Continental Illinois' chairman that Sewell Lee Avery of Montgomery Ward resigned from the bank's board in disgust. Mr. Ranney announced he would like to have his name withdrawn from consideration.
¶ In a State Court in Manhattan the Federal Government filed an unprecedented suit to compel the 20 banks of the New York City Clearing House to pay $9,375,000 for losses of the defunct Harriman National Bank (TIME, March 27). The Government's contention was that when during the dark summer of 1932 officers of the Clearing House promised to support the Harriman, it bound members of the Clearing House to pay any losses to Harriman depositors. To this Clearing House officials retorted that the Clearing House did not and could not give such a guarantee, that the directors of many member banks did not know or approve it, that the directors of the member banks did not legally have the right to guarantee the deposits of another bank.
¶ Efforts to promulgate banking regulations under the banking code brought a blow-up from General Johnson, when depositors howled against proposed service charges. Cried he: "If the banks want to commit suicide nobody is going to worry much about it ... but I am interested in protecting the public."
¶ A wholesale retirement of directors took place from nearly all the big banks of the U. S. They stepped out to comply with the provision of the Banking Act of 1933 which prohibits a person interested in dealing in securities from serving as a bank director after Jan. 1. Among retiring directors: Floyd L. Carlisle of Niagara Hudson and Frederic J. Fisher (bodies) from Manhattan's National City. Philip Stockton of Boston's First National reversed the drift by resigning from First of Boston Corp. (securities affiliate).
*Under the permanent plan in force July 1 banks will be assessed on their total deposits, all of which will be insured up to at least 50%.