CHAPTER XIII
BANKS AND BANKING
Origin of Banking---Functions of the Bank of To-Day---The Banks of Marion, Prospect, La Rue, Caledonia, Waldo, Green Camp and Morral---The Building and Loan Companies of Marion.
BY BENJAMIN F. WAPLES
The word "bank" is of Greek origin. In that language it means a bench or table for changing money. The word "bankrupt" is of Italian origin, as in Florence the term banca rotta meant "broken bench'' hence a bankrupt had his bench broken. The first bankers sat behind a little bench on the open street with their money piled upon the bench in front of them This was their "bank," and when their money was lost, then their bench was said to be broken, from which comes our term "bankrupt."
There are three great functions which the bank of to-day performs, viz., the receipt of deposits, the making of discounts, and the issue of notes. For the last named, a charter is generally granted at the present time, though in earlier days, and especially in England, private banks and banking firms could issue notes. It is possible, however, to group all the duties of a bank under two heads-lenders and borrowers. Their loan able funds consist of their own capital, and that of their depositors. Their profits arise from the payment to them of interest on loans. The origin of banking goes back to the most remote antiquity. The modern banker is generally a dealer in credit, while in ancient times he was a mere custodian of other people's money, and a buyer and dealer of foreign moneys. The first credit instrument handled by the early bankers appears to have been a bill of exchange. The historians find the bill of exchange in use in Assyria, a thousand years before the birth of Christ. The same was true in Athens and Rome, though not quite so early as in Assyria. The profits in those early days seem to have come almost entirely from commissions on deposits. Livy first mentions (B. C. 350) this system in banking and it is frequently referred to in Latin literature of a later time. The great insecurity of all kinds of property during the Middle Ages almost destroyed the system of banking. In fact it was reduced to that of mere money changing.
The rise of modern banking, however, dates from the establishment in Venice of the Banco di Rialto in 1587. In 1619 this great bank was absorbed by the Banco del Giro. So strong did this latter bank become that it was relied upon as the main support of the government, and we have a record that it loaned the government of Venice 500,000 ducats at one time. So well were its affairs managed that
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for 100 years or more this Bank of Venice, as it was called, was enabled to hold all its. credits at a premium, until 1805, when its affairs were liquidated under a decree of Napoleon.
In the 18th century the two characteristics of modem banking the issue of notes not covered by coin, and the granting of deposit accounts upon the mere credit of borrowers were evolved, and this forms a part of the banking system of to-day. In China, bank notes, such as are known to the modern banking system in America, were more or less familiar for 12 centuries, but in Europe the use of bank notes dates only from 1661, when the Bank of Sweden issued notes to avoid the transfer of copper coin. The world is more or less familiar with the Bank of England, established at the close of the 17th century. This great banking institution, perhaps the greatest in the world, was established by a Scotchman, and more than once has it saved not only the credit, but the real life of England. It is familiarly known as the "Old Lady of Threadneedle Street." The Bank of Scotland was not established until shortly after the Bank of England, but it received privileges from the English government, similar to those possessed by the Bank of England. In America; the words "Wall Street" carry with them a financial significance, recognized in every corner of the world. It was formerly said that "when the Old Lady of Threadneedle Street took snuff, Wall Street sneezed." This is not true at the present time. Wall Street stands alone, and the money interest of the United States is on a par with the greatest nation of the world.
No civilized country can make advancement without a bank. When conservatively managed, it is a blessing not only to its immediate community, but to the world of advancement it large, and in Marion County it may safely be said that the financial interests are well managed, and of liberal, patriotic usefulness, when needed for the advancement of the county.
The following accounts of the banks of Marion County and of the building and loan associations will be of interest to every citizen of the county.
BANKS OF MARION.
The Marion County Bank.- Prior to 1840 there were no banks in the county and the banking business was done principally at Columbus and Delaware. In 1839 J. S. Reed, Dr. H. A. True and R. H. Johnson, under the firm name of J. S. Reed & Company, organized a bank with a capital of $30,000
Only those acquainted with the frontier can appreciate the difficulties of doing business in a new country in 1839, and the succeeding years. There were no railroads, and what were called wagon-roads were roads in name only. Goods were brought from the East over the Erie Railroad to Buffalo, transported by boat to Sandusky and from there by wagons overland, over roads at time almost impassable. The difficulties of the banker in doing business were no less than those of the merchant. They had problems to meet in the transporting of money which were costly and hazardous. The rate of exchange was as variable as the weather. The national government had not inaugurated its present excellent currency system, and up to 1861 almost every bank issued its own money, the best of which was always subject to a discount. To make matters worse, this money could be easily counterfeited. Good money was scarce and interest rates were high.
But in the face off all obstacles Marion's, first bank prospered, from the time it began business to the present. It has passed through all the financial panics without suspending business for an hour. It was organized in 1843-44 under the name of The Marion County Bank. Later the capital was raised to $100,000. It remained a private bank until 1891, when it was incorporated tinder the laws of the State of Ohio as The Marion County Bank Company, with many of Marion's best business men as stockholders.
The old officers of the bank, J. S. Reed, Dr. H. A. True, R. H. Johnson, J. H. Reed and Henry True have all passed away.
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The present officers are William Schaffner, president; George D. Copeland, vice-president; C. C. Fisher, 2nd vice-president; C. D. Schaffner, cashier; C. C. Fisher, W. B. Fisher, W. H. Schaffner, George D. Copeland, H. Ackerman, George B. Christian, Sr., H. A. True and J. G. Leffler, directors.
Its present paid-up capital is $250,000, with a surplus of $55,000.00 and average deposits of more than $600,000.
The Marion National Bank is the successor to the Farmers' & Mechanics' Bank. The history of this financial institution began in 1851, when the Bank of Marion was chartered with.a capital stock of $50,000. Its first president was Ozias Bowen and its first cashier, W. W. Concklin. In 1864 it was reorganized and became the First National Bank of Marion, with a capital stock of $125,000. A. Monnett was president and John J. Hane, cashier. Five years later it gave up its charter as a national bank, organizing as a State bank, and so continued until June 2, 1902, when it was reorganized as a national bank with a capital stock of $200,000. It has $65,000 of surplus and undivided profits, deposits of more than $525,000, and circulation amounting to $125,000. The bank building is one of the most handsomely appointed in Northern Ohio. It is a prosperous and flourishing bank, enjoying the entire good will of a thrifty and Wealthy business community. The present efficient management of the institution is constituted as follows: Directors-John E. Waddell, T. J. McMurray, George W. King, Henry Strelitz, Dr. C. E. Sawyer, H. B. Hane, J. G. Leffler, H. A. Martin and Oswald Wollenweber; president, John E. Waddell; vice-president, T. J. McMurray; 2nd vice-president, Dr. C. E. Sawyer; cashier, C. N. Phillips; and assistant cashier, E. J. Lee.
The Fahey Banking Company -In 1872 Timothy Fahey started an individual bank, in connection with his general store, with a capital of about $12,000. The bank was located in the rear of his store-room which was in the same room now occupied by The Fahey Banking Company. This company was incorporated in 1893 with a capital Of $300,000. Its business methods are such as to commend it to the public as one of the thorough-going and substantial concerns of the city. Its surplus and undivided profits amount to more than $27,000, and its deposits to $240,000. The officers are: Timothy Fahey, president; Frank A. Huber, vice-president; A. C. Edmondson, cashier; and M. C. O'Brien, assistant cashier. The directors are: Timothy Fahey, Frank A. Huber, J. F. Prendergast, A. C. Edmondson, J. A. Schroeter, J. G. Fairbanks, W. E. Scofield, and C. Breen.
The City National Bank was opened for business in the room which it now occupies, at the northwest comer of the Public Square, on May 15, 1901. The stockholders are representative men of the city and vicinity. The capital stock is $100,000, surplus and undivided profits $25,000, deposits, $400,000, and circulation, $25,000. The equipment of the bank is of the highest order. The officers are: I. A. Merchant, president; D. R. Crissinger, vice-president; D. H. Lincoln, cashier; and J. H. Wetmore, assistant cashier. The directors are: I. A. Merchant, A. E. Cheney, Charles M. McElvy, Frank A. Huber, John D. Owen, Dr. C. E. Sawyer, D. R. Crissinger, George W. King, E. Browne, James B. Guthery, Busby P. Sweeney. George E. Salmon and Dan Evans.
The Marion Savings Bank, while not the oldest banking concern in the city, is one of the most progressive and has become fully established in the good graces of the people of Marion. Its business is an ample evidence that the people appreciate courteous treatment. The bank began business May 16, 1904, with a capital Of $50,000. Its deposits now amount to $200,000. It does a general commercial and savings business. The officers are: W. H. Houghton, president; A. Barron, vicepresident; Benjamin F. Waples, cashier; S. H. DeLong, assistant cashier. The directors are: W. H. Houghton, A. Barron, Benjamin F. Waples, J. W. Jacoby, C. E. Merkel, John
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Schneider, S. G. Kleinmaier, John Rexroth, M. Lawrence, J. E. Phillips, R. T. Lewis, J. Bindley, Philip Loyer, J. B. Gunder and P. F. Foreman.
BANKS OF PROSPECT.
The Prospect Bank, of Prospect, was organized in 1880. Its first officers were B. K. Herbster, president, and W. H. Mohr, cashier. It has a capital stock Of $20,000, surplus and undivided profits Of $2,200, and individual deposits amounting to $90,000. The present officers are: B. K. Herbster, president; L. H. Wottring, vice-president; George W. Cook, cashier; and J. F. Moore, assistant cashier.
The Citizens' Bank, of Prospect, was organized April 26, 1883, with a capital of $8,000. Its first officers were F. C. Freeman, president, and Joseph Cratty, cashier. In 1902 M. E. Flemming became president and J. N. Freeman, cashier. The undivided profits of the bank amount to $1,500, and the individual deposits to $60,000.
BANKS OF LA RUE.
The La Rue Bank, of La Rue, was opened for business in 1882, as a private enterprise with J. H. Leonard as cashier and owner. It was incorporated April 2, 1903, as a State bank, with a capital Of $30,000. It now has a surplus Of $7,000 and deposits amounting to $100,000. The present officers of the bank are: W. L. Raub, president; J. H. Leonard, vice-president; L. G. Copeland, cashier; and D. H. Clement, assistant cashier. The directors are: W. L. Raub, J. H. Leonard, L. G. Copeland, Milton Morral, C. F. Stahl, W. L. Guthery and W. L. Morral.
The Campbell National Bank, of La Rue, was chartered March 16, 1903, being the successor to Campbell's Bank, which began business as a private bank in 1888. The bank has a capital Of $30,000, surplus and undivided profits Of $3,200, and deposits of over $90,000. The officers are : 1. S. Guthery, president; B. F. Sager, vice-president; D. D. Clifton, cashier; and F. L. Topliff, assistant cashier. The directors are: 1. S. Guthery, F. F. Miller, D. D. Clifton, L. G. Copeland, B. F. Sager, Fred E. Guthery, Elias E. Riley, Joseph D. Guthery and Minerva B. Campbell.
BANKS OF CALEDONIA.
The Caledonia Deposit Bank, of Caledonia, was organized as a private bank July 25, 1883, with a capital of $11,000. William Rowse was the first president and C. H. Rowse, first cashier. In 1893 the bank was sold to J. A. Chesney, George Donnenworth, Daniel Babst and L. C. Donnenworth. In 1898 Daniel Babst sold his interest and January 1, 1904, J. A. Chesney and George Donnenworth sold their interest to the present owners. The capital is now $20,000; undivided profits, $2,000; and individual deposits, $120,000. The officers are: H. A. Hipsher, president; R. L. Highly, vice-president; L. C, Donnenworth, cashier; and T. J. Pittman, assistant cashier.
The Farmers Savings Bank, of Caledonia, was incorporated July 2, 1906, with a capital of $25,000. The officers are: A. M. Dilts, president; W. J. Weir, vice-president; J. D. Harrison, cashier; and S. E. Irey, assistant cashier.
THE FARMERS' BANK, OF WALDO,
Was organized as a private bank April 24; 1898, with a capital of $10,000. W. H. Mohr was its first cashier. The bank has a surplus of $1,300, and deposits amounting to $40,000. The officers are: William Klingel, president; J. D. Bowers, cashier; and W. D. Kraner, assistant cashier. The directors are: William Klingel, J. D. Bowers, William Gabler, John Gearhiser and R. S. Dombaugh.
THE PEOPLE"S BANK, OF GREEN CAMP,
Was started June 23, 1904, with a capital of $10,000. Its deposits are over $50,000. B. K. Herbster is president; J. F. Wottring, cashier, and J. F. Moore, assistant cashier.
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PAGE 172 - PICTURES: Y.M.C.A BUILDINGS (MARION), GRAND OPERA HOUSE (MARION), HUBER BLOCK (MARION) AND MARION NATIONAL BANK BUILDING (MARION)
THE MORRAL BANK
Was incorporated February 21, 1905, and began business the following August. It owns its own banking room, equipped with a fireproof vault and a "Victor" burglar-proof safe. Its capital is $25,000, undivided profits $1,000, and its individual deposits amount to $25,000. The officers are: William Mehaffey, president; Dr. C. W. Jacoby, vice-president; and J. H. Bardon, cashier. The directors are: William Mehaffey, Dr. C. W. Jacoby, J. H. Bardon, S. B. Creasap, J. Baer, Benjamin F. Waples, A. A. Gottschall and J. B. Martin.
* * * * * * * * * * *
The combined capital and surplus of Marion County's banks amount to more than $1,250,000. and the aggregate deposits, to more than $2,400,000.
BUILDING AND LOAN COMPANIES OF MARION.
The business methods followed by the local building and loan companies make possible many real estate transactions and most of the building and repair work that go a long way toward giving Marion its present prosperity. They. were organized for the purpose of raising money, on which dividends or interest is paid, to be loaned among the members and depositors for use in buying lots, building and repairing houses, and for such other purposes as come in the avenues of legitimate business. The business of the local building and loan companies is confined almost entirely to Marion County, and dividends are paid semi-annually to the stockholders and depositors.
The first building and loan association in Marion was organized in 1871 with Thomas W. Prosser, president; E. Durfee, secretary; John J. Hane, treasurer; and John J. Williams, attorney. This company did business until 1881 when it dissolved by limitation.
In 1873 The Merchants' and Mechanics' Building and Savings Association was organized and did business for seven years.
The Marion Building, Savings and Loan Company was organized March 9, 1888, and has an authorized capital of $1,000,000. Its last statement showed assets in the sum of $321,382.35, and a dividend of 5.4 per cent. was declared for the year. Its present officers are: A. H. Kling, president; John E. Waddell, vice-president; Martin J. Burke, treasurer; E. Durfee, secretary; and J. F. McNeal, attorney. The directors are: A. H. Kling, J. Burke, J. F. McNeal, John E. Waddell, William Fies, Frank A. Hubler and C. L. Allen, The depository of the company is The Marion National Bank.
The Home Building, Savings and Loan Company was organized August 18, 1898, with an authorized capital of $1,000,000, and began business November 1st of the same year. The last statement of the company, giving its condition at the close of the year 1906, shows that the assets were $395,800. A dividend of 5.65 per cent. was declared for the year ending 1905. The officers are as follows: Henry Ackerman, president; George B. Christian, Sr., vice-president; Johnson Mooney, 2nd vice-president; W. H. Schaffner, treasurer; Michael Waddell, secretary; and, E. E. Bush, superintendent of loans. The directors are: Henry Ackerman, W. H. Schaffner, J. G. Leffler, George D. Copeland, George B. Christian, Sr., C. H. Norris, E. E. Bush, Warren G. Harding, C. C. Fisher, Johnson Mooney, C. T. Wyant, S. G. Klemmaier, J. H. Bartram, H. A. True and J. D. Owen. The company's depository is The Marion County Bank.
The Citizens' Building and Loan Company was organized January 10, 1902, with an authorized capital Of $300,000. The assets of the company at the close of 1906 amounted to $111,400. A dividend of 6 per cent. was declared for the year ending 1905. The officers of the company are Michael Lawrence, president; Jacob J. Schoenlaub, vice-president; A. Barron, treasurer; 0. G. Briggs, secretary; and J. W. Jacoby, attorney. The directors are: Michael Lawrence, J. W. Jacoby, I. A. Merchant, A. Barron, S. H. DeLong, C. E. Merkel, John Schneider, John A. Schroeter and Jacob Schoenlaub. The depositories of the company are The City National Bank and The Marion Savings Bank.