Albion Interactive History / Businesses / Albion State Bank

Albion Interactive History

Albion Interactive History / Banking

Albion State Bank, 1895
 
    Closed December 22, 1931

Eugene P. Robertson served as head cashier in Sheldon’s Albion Exchange Bank. When Sheldon died in 1894, Robertson reorganized the bank.The Albion State Bank received its charter from the State of Michigan on March29, 1895, and opened under the new name April 2. Its original officers were:Eugene P. Robertson, president; William B. Knickerbocker, vice-president; DavidA Garfield, cashier;. On the original board of directors were: Lewis R. Fiske,president of Albion College; Warren S. Kessler, president of the AlbionMalleable Iron Works; D.L. Jacobs, area farmer and industrialist; and A.J. Gale,vice-president of the Elm Buggy Company.

At its inception, the Albion StateBank had a capital of $50,000, with a surplus of $20,000. By 1912 the amountdeposited exceeded $370,000. In time, other prominent Albion citizens becameassociated with the bank, including George T. Bullen, D.M. McAuliffe, Norman H.Wiener, Bruce Green and others. 

The Albion State Bank attempted toencourage savings by offering various incentives. Despite incentives, depositsdwindled in the late 1920s. It is highly probable that one reason for thedwindling reserves was bad management. The bank had loaned a substantial amountof money for the ill-fated Albion coal mine project north of the city and hadlost most of these funds.

After the stock market crash in 1929, business wastight in Albion, and the city was entering the era of the Great Depression. Anominous sign of things to come occurred on Friday, April 4, 1930, when two men enteredthe bank shortly before noon. They suddenly announced a hold-up, orderedeveryone on the floor, and forced the cashier to open the main vault safe. Aftertaking $38,00, the robbers fled in a maroon Studebaker bearing Illinois licenseplates, toward Coldwater, and were never caught.

Although the robbery did notforce the bank to close, it was no doubt a factor in dwindling deposits. OnDecember 22, 1931, three days before Christmas, the Albion State Bank closed itsdoors to the public as a precautionary measure to safeguard the deposits of itscustomers. The closing had come about because of the dwindling reserves. Savingsaccounts were frozen, a move which greatly angered many Albion residents. In thefollowing decade, payments were made to depositors in amounts totaling around80% of the funds each person had deposited.

Source: Frank Passic. Albion’s Banks and Bankers. Albion, Michigan:Albion Civic Foundation. 1985.

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