Looking Back: Citizen's Bank of Metolius failed to open for business

100 YEARS AGO

October 21, 1926

The Citizens State Bank of Metolius, which a number of years ago consolidated with the Metolius State Bank, failed to open for business Monday morning, and the writer is reliably informed that the action for liquidation was taken voluntarily by the directors at a regular meeting.

This is one of the older institutions of the county, having started in business during the railroad times of 1909 and 1910 and when it was anticipated that there would have been business enough for several banks in the territory now comprising Jefferson County.

The voluntary liquidation action was taken probably on account of frozen assets that could not be readily moved. The institution not being a member of the Federal Reserve System no doubt contributed, inasmuch as they were unable to transfer their paper to this system. Also in a measure, the poor crop condition prevailing in this section for the year 1926 had its effect toward lower deposits.

George Euston of the Central Oregon Bank of Bend assumed temporary charge Monday and checked up on the local matters, and Tuesday, R.H. Coppock arrived from Salem to assume actual charge of the liquidation of the institution and act for the State Banking Department.

Last Tuesday's telegram has the following to say regarding the closing of the Metolius bank:

"Closing of two country banks in Oregon was announced Tuesday by Frank C. Bramwell, state superintendent of banks.

"The institutions in distress are the Citizen's State Bank of Metolius and the First Bank of Pilot Rock. G.N. Hickok, assistant superintendent of banks, is in charge of the Pilot Rock institution and R.H. Coppock, who for Superintendent Bramwell, directed liquidation of the State Bank of Coburg, is in charge of the Metolius bank.

"The distress of the banks was brought on by an over-loaned condition, and, according to Superintendent Brambwell, suspension was ordered when it became evident that to continue would be imprudent. How much loss, if any, depositors will suffer as a result of suspension cannot be determined until a complete audit has been made.

"According to the latest official report as of June 30, the Metolius bank had $62,300 in loans and discounts, $65,000 in deposits and $15,000 capital. There has been no bank failure in Oregon since Oct. 16, 1925, where the State Bank of Coburg, a small institution, was closed by the state banking department."

All national banks are required to be members of the Federal Reserve System and all state banks having a capital of $25,000 or more and showing a sound financial condition may upon request become members of this system, and banking experience has shown that membership in the Federal Reserve System is a strong factor in preventing bank failures and that almost all of the bank failures in recent years are failures of those banks which are not members of the Federal Reserve System.

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