Jasper County Democrat, Volume 7, Number 3, Rensselaer, Jasper County, 23 April 1904 — McCOY BANK CLOSED [ARTICLE]

McCOY BANK CLOSED

Oldest Financial Institution In Jasper County Goes to the Wall.

SEVERE BLOW TO THE DEPOSITORS Who Number Hundreds In Various Walks of Life. ASSIONHENT MADE TO WM. A. RINEHART, A SON-IN-LAW. Assets About $250,000; Statement of Liabilities Not Yet Made; Will Likely Exceed Liabilities. last Monday morning, the following type-written notice was posted on the glass of the front door of A. McCoy & Co., private bank: i Rensselaer, Ind., April 18, 1904. “Owing to sickness and other matters this bank will be closed and will go into liquidation. A. McCoy & Co.” As soon as the full purport of of this notice became apparent groups of men gathered on street corners and discussed the matter. Some could hardly realize that the bank which had done business here for half a century, and was regarded by most people as one of the strongest institutions in Northwestern Indiana, had failed, and this, too, when it was supposed that it was reveling in the prosperity of which its proprietors had had so much to say. As the day progressed the groups became more numerous and the discussion became more animated. Some of the bank’s strongest friends thought in the morning that the suspension would not mean a loss to the depositors, but that the large landed assets were sufficient to cover twice the liabilities, but when people began to unbosom themselves who had funds deposited there, and it was found that hundreds, if not thousands, had been caught, it was seen that the liabilities would reach a much larger sum than first supposed, and grave fears were felt of its being able to pay outX To add to the uneasiness of its creditors, W. A. Rinehart, A. McCoy’s son-in-law was appointed by the McCoys as receiver. The creditors thought—many believe rightly—that the receiver should be some one outside the family; that in the appointment of a member of the family there were matters concerning the bank’s business which it was desired to keep secret, that an assignee should be appointed who would not be hampered by relationship in making a diligent search for all the assets. It was thought at first that every dollar’s worth of property would be turned over to pay the creditors, but Monday evening a deed of assignment was filed with the recorder, naming Rinehart as assignee, covering the bank building, a few vacant lots in Rensselaer, 2,233 acres of land in Jordan tp.; one-half interest in 519 acres in Union tp.; 40 acres in Lake county (Tom’s Island in the Kankakee); and one-half interest in 320 acres in Section 27, Gillam tp., but the wives did not join in the deeds nor was the fine residences of the McCoys on McCoy avenue turned over. The latter belong to their wives, and their not turning them over to the creditors and thus be thrown out of a home, is not generally criticised. It i§ said they will join in the deeds of assignment if Mr. Rinehart is allowed to act as assignee. The schedule of personal property was as follows:

SCHEDULE A. Aggregate value of secured notes.sls,ooo Aggregate value of unsecured notes SIOO,000. Some of which are up for and as collateral. Aggregate value of all other credits, choses in action, unsecured.. .$25,000 330 head of cattle, 8 head of horses, 15 head of mules, 60 head of hogs, 200 head of sheep and goats, 10,000 bushels of corn, 3,000 bushels of oats. Household goods and furniture, carriages, wagons, buggies, etc. A more detailed schedule of personal property will be filed later, the assignment states, and that they have not transferred or reserved any sum of money or article of for their own use or to any other person nor acknowledged a debt or confessed a judgment to any person or perons with the intention of delaying or defrauding their creditors It is thought that practically every resource was exhausted by the bank, except mortgaging the Jordan township land, before closing its dqors, and that most of the gilt-edge paper was up for collateral with other banks and persons in an endeavor to tide matters along, and that the paper left is'mostly unsecured. The land is worth probably S6O per acre, on an average, the Jordan land possibly being worth $65. The total assets will probably foot up to $250,000, but no complete statement of liabilities has been made as yet. It is thought by many that they will reach near $500,000. If such is the case it is not likely creditors will realize more than 50 to 75 cents on the dollar. Many hope it will prove better than this, however, and some still think that it will pay out in full. A. McCoy says that if given time, and the assets are not sold at a sacrifice, he thinks it will pay dollar for dollar, He says, so we are informed, that the bank has been paying out nearly $2,000 per day more than it took in for the past two months. On April 7th the elder McCoy transferred his half interest in 1900 acres of land in Hanging Grove township to his daughter, Mrs. Mattie Rinehart, who owned the other half, and she immediately mortgaged it for $37,000, of which $17,000 went to one of the banks here to discharge McCoy bank obligations, and the remainder is alleged to have been paid out over the counter of the latter bank on depositors’ checks. It is also alleged that when the bank closed Saturday night there was less than SSOO in cash in the safe.

The bank of A. McCoy & Co., was started here in 1854 by Alfred McCoy and Alfred Thompson, and was the oldest bank in Jasper county. It had been largely patronized by the farmers and stockmen of the county and was regarded by most people as solid as a rock. Quite a number of former patrons, however, had felt for the past few years that it was doing tod reckless a business, and quietly withdrew most of their money and placed it in the other banks. Ten years ago Thomas J. McCoy was taken in as a partner and given practically sole control of the institution. Tom was a whole-souled, genial fellow, fond of expensive society, and was known as a high-roller of the first water. Many people felt that his pace was too fast to last. The elder McCoy is reported to have said Monday that when Tom came into the bank he (A. McCoy) had j all his land clear, hundreds of S

head of cattle and $30,000 surplus. On the other hand, A. McCoy often went to extremes knd made investments that proved disastrous. He also had a penchant for betting on elections, and lost considerable money in that way. Tom had to hold him down in some of these matters, and the blame for the present condition of affairs should be shared by both parties, is the opinion of many. Of the depositors, many were widows and laboring men, school teachers, etc., besides nearly every township trustee in the county is caught for Various sums, most of them for SI,OOO to $4,000, and the county treasurer had funds there, which amount he has variously stated, we are told, all the way from $3,000 to SIO,OOO. As this was near the end of the spring tax-paying time, many people think he had $20,000 to $30,000 there. One feature that is causing considerable adverse criticism is the alleged taking of deposits Saturday afternoon and alleged refusing to pay some larger checks. One check for $112.18 was protested Saturday night after it is alleged it had been presented twice during the day for payment.

It is rumored that the creditors will not allow Rinehart to act as receiver, but that they want Granville Moody, John F. Major, or some equally capable and disinterested man to act. There promises to be a lively tilt over this part of the matter before it is over with. Mr. Rinehart informs The Domocrat that if he acts as assignee he will do the best he possibly can with the business. He thinks, from what T. J. McCoy tells him, that the liabilities will not run over $325,000 to $350,000. While he hopes that the bank will pay out in full, yet he does not hold out much promise of its being able to do so. He thinks, however, from what little he knows now, and what Tom has told him, that it will nearly pay out. . The only thing the creditors can do is to keep cool and wait the filing of the schedule of assets and liabilities. This will probably not be done for several days. T. J. McCoy is still confined to his home with what is said to be a severe case of appendicitis, and few outside his family is allowed to see him. The assignee has just begun work with the clerks compiling a schedule of assets and liabilities. He has not been confirmed as yet as assignee, and we understand that this cannot be done until the schedules are filed, when he must put up a bond of double the amount of the liabilities. He has fifteen days in which to complete the schedule. Depositors are daily growing more pessimistic over the matter, perhaps unreasonably so. Whatever the final outcome, the final outcome, the failure is a deplorable one, and ties up a large amount of money, and will hurt business in Rensselaer and Jasper county for the next year. While The Democrat would like to offer some encouragement to the creditors, yet it should be borne in mind that the failure is not the result of a sudden run, but is evidently caused from many years of bad management. An unexpected run leaves the bank its secured paper, only exhausting its ready cash, while in the latter case every resource is usually exhausted before its doors are closed. We do not think, however, that it would be wise for creditors to sell their claims, but to await developments. The prospects now are that the wives of the McCoys will not join in conveying the real estate, but will claim their one-fifth interest in the same. This is admitted to be the most valuable asset the bank has, aad if the wives claim their fifths n will materially reduce the available assets.