EARLY DAY BANKING—PIONEER FINANCIERS—THE OLDEST BANK—PRIVATE, STATE, AND NATIONAL BANKS—ATCHISON COUNTY BANKERS AND THE DEVELOPMENT OF BANKING INSTITUTIONS.

Banking was a precarious business during the Territorial days in Kansas. There were no banks, as we know them, until January 29, 1857, when the Territorial legislature passed an act providing that every company or association of persons formed for banking purposes within the Territory, and without an act of legislature authorizing the same, should be deemed unlawful. Upon the passage of this act, the first bank authorized to do business under it was The Kansas Valley Bank, of Leavenworth, with an authorized capital stock of $800,000.00, with five branches, at Atchison, LeCompton, Doniphan, Ft. Scott and Shawnee. The authorized capital stock of each one of the branches was $300,000.00, and under the terms of the act, each branch was independent of the Leavenworth institution. The great Government Overland Transportation Company of Majors Smoot-Russell & Company was the big financial power behind this organization. The Leavenworth bank was never formed, and the Atchison branch was the first to start out under this act of the legislature, being authorized to begin business February 19, 1857, with securities amounting to $100,000. Dr. John H. Stringfellow, Joseph Plean and Samuel Dickson were authorized to open subscription books. The board of directors included Samuel C. Pomeroy, who was president: W. H. Russell, L. R. Smoot, W. B. Waddell, Franklin G. Adams, Samuel Dickson and W. E. Gaylord. Shortly after the bank began business there were rumors emanating from the rival towns of Sumner and Doniphan that the Atchison institution was about to suspend, and for the purpose of allaying any suspicion on the part of the public, created by these rumors, the directors published a statement 235of its condition, showing that the assets were $36,638.00, with liabilities of $20,118.00. In July or August, 1857, L. S. Boling, of LeCompton, was appointed to examine and report on the financial condition of the Atchison branch of the Kansas Valley Bank, and this is the first record in Kansas of a proceeding of this kind.

Samuel C. Pomeroy resigned as president of the bank in 1858, and was succeeded by William H. Russell, of the contracting firm of Majors-Smoot-Russell & Company. G. H. Fairchild was made vice-president, and R. L. Pease, cashier.

In 1861, this bank, then called the Kansas Valley Bank, had its name changed by act of the legislature, to the Bank of the State of Kansas, and it was conducted under that name until 1866, when the stockholders wound up its affairs.

The legitimate successor of the Bank of the State of Kansas was Hetherington’s Exchange Bank, which was founded in 1859 by William Hetherington.

The Exchange National Bank, of Atchison, Kan., is the oldest banking institution in the city of Atchison, having been established in 1859, while Kansas was a Territory. The bank was then named the Hetherington Exchange Bank. That bank became the successor of the Bank of the State of Kansas, which was organized in 1857. The founder of the Hetherington Exchange Bank was William Hetherington, and, except for one year during the Civil war, it has been in successful operation since it was established. It passed through the period of its existence during Territorial days, and the depressing financial conditions as a result of the war, and business reversals incident to the reconstruction period, and its management was at all times conducted upon the theory of its motto adopted by William Hetherington in an early day that “Safety First” in all of its business transactions was the secret of success.

The bank’s first business home was in the Otis & Glick building, opposite the Byram Hotel. In 1869 it was moved to the Hetherington building, at the northwest corner of Fourth and Commercial streets. Later on, and in 1885, the bank was moved to the southwest corner of Sixth and Commercial streets, into the building erected by its president, William Hetherington, where it has since been located.

In 1876, William Hetherington admitted into the firm, as a partner, Webster W. Hetherington, his eldest son, and in 1881, Clifford S. Hetherington, his youngest son, became associated with him. In the year 1882 the Hetherington 236Exchange Bank was incorporated under the laws of Congress, as a National bank, under the name of The Exchange National Bank of Atchison, with a paid-up capital of $100,000, and surplus of $20,000, and at once took high rank as one of the strongest and most conservative banks in northeastern Kansas, and has ever since maintained that reputation.

The Exchange National Bank was organized with William Hetherington as president, August Byram, vice-president, Webster W. Hetherington, cashier, and C. S. Hetherington, assistant cashier. In 1890, upon the death of its president, William Hetherington, Webster W. Hetherington was elected president, B. P. Waggener, vice-president, and C. S. Hetherington, cashier. In 1892, upon the death of its then president, Webster W. Hetherington, B. P. Waggener was elected president, A. J. Harwi, vice-president, W. P. Waggener, vice-president, C. S. Hetherington, cashier, C. W. Ferguson, assistant cashier, and Webster Wirt Hetherington, teller. In October, 1906, C. S. Hetherington, the cashier, died, and C. W. Ferguson was elected cashier, and Webster Wirt Hetherington, assistant cashier, and Edgar Mattocks, teller. In April 1907, the capital stock of the bank was increased to $200,000.00 with a surplus of $50,000, and ex-Governor W. J. Bailey was elected vice-president and managing officer of the bank, which position he has since held. Upon the death of A. J. Harwi, his son, Frank E. Harwi, was elected director, and succeeded his father, A. J. Harwi, as vice-president, which position he now holds.

In 1892 the bank adopted a by-law, which prohibited any officer or director of the bank from borrowing any money from it, or becoming an endorser or surety on any obligation or note to the bank, since which time no officer or director of the bank has been permitted to borrow any of its funds on deposit. The wisdom of this by-law adopted in 1892 has repeatedly been approved by the comptroller of the currency. The management of the Exchange National Bank has adopted and adhered to this policy, because it believes that a bank officer or director should not be permitted, under any circumstances or in any emergency, to use any of its deposits in any of his own personal speculations or ventures.

In February, 1914, Webster Wirt Hetherington was appointed cashier, and Edgar Mattocks was elected assistant cashier, and George L. Wolfe, teller.

While the bank is known far and wide throughout the State of Kansas for its conservatism, yet it makes an effort to accommodate all business institutions in the city of Atchison entitled to assistance and credit. It aims to be a distinctive Atchison institution.

237Luther C. Challiss appeared as a banker in the city directory of 1859 and 1861, operating his bank at the corner of Second and Commercial streets, but not much is known of this institution.

First National Bank was organized on the first day of October, 1866, by David Auld, with the following as the first board of directors: David Auld, Henry Kuhn, H. H. Moulton, George Scarborough, C. G. Foster, D. C. Newcomb, and J. M. Linley. David Auld was elected president, George Scarborough, vice-president, and W. R. Stebbins as cashier. For thirty-eight years this bank was under the careful and conservative management of David Auld, who died in October, 1904, and was succeeded by his son, David Auld, Jr. The bank began business in July, 1867, and since that time has been one of the strongest financial institutions in the West. It has always had the benefit of the services of experienced men in the banking business, and has followed a conservative policy during the whole of its existence. In 1910 the controlling interest in the First National Bank was purchased by the Commercial State Bank, which was organized in Atchison in 1906 by Sheffield Ingalls and O. A. Simmons. In the merger that took place the Commercial State Bank was absorbed by the First National Bank, and has continued under the latter name to maintain its high standard of conservatism, and with the introduction of new blood and new methods, it embarked upon a policy of service which has redounded to the lasting benefit of the community. The present officials of this institution are as follows: Edward Perdue, president; J. H. Barry, chairman of the board; O. A. Simmons, first vice-president and manager; J. M. Schott, second vice-president; Charles Linley, cashier; George H. Edwards, assistant cashier; F. J. Ledoux, assistant cashier.

The directors represent varied business interests of this city and county, and are as follows: Edward Perdue, J. H. Barry, O. A. Simmons, Charles Linley, J. M. Schott, C. C. McCarthy, August Manglesdorf, Leo Nusbaum, Sheffield Ingalls, A. E. Mize, M. Noll and W. T. Hutson.

The Atchison Savings Bank claims the distinction of being “The Oldest State Bank in Kansas,” having enjoyed a continuous corporate existence of over forty-six years.

R. A. Park was its organizer and first cashier, and in June, 1869, it opened its doors for business in a brick one-story building at the northwest corner of Fifth and Commercial streets. At that time most of the business was centered close to the river, and this was considered quite an “up town” location, but time has vindicated the judgment of its early director in anticipating the westward growth of the town. With the expectation of building 238thereon the bank early acquired title to the lot at the southwest corner of Fifth and Commercial streets, but subsequently disposed of it to the late Ex-Governor John A. Martin, who built the Champion building thereon, and the bank moved to its present quarters, which it had acquired, and still owns, at the southeast corner of Fifth and Commercial.

William C. Smith (father of Henry T. Smith) was the first president but the late Judge A. G. Otis soon thereafter succeeded him and remained president until 1891.

Thomas Murphy (father of John Murphy and one of the builders of the present Cain Mill Company mill), W. W. Guthrie, Julius Kuhn, C. J. Drury, Col. Wm. Osborn, J. W. Parker, and other men prominent in the business and social life of that period were among its early stockholders and directors, while for seventeen years the late T. C. Platt served as teller, and by his affability and faculty of remembering people, made many friends for the institution. A baseball bat, kept under the counter, was his weapon for defending the funds in his care. Courtney Challiss, George H. Lawton, “Vode” Kathrens, Lowenholt, O. Orlopp and Will H. Bryning and others also served varying terms as early employees and will be remembered for their distinctive personalities. An apothecary’s scale for weighing gold dust was part of the early equipment, but one trial was sufficient to prove the presence of too much dust and too little gold in the commodity offered. For almost twenty years the bank ran with but few restrictions from the State, the law simply requiring it to file an annual statement of its capital, surplus, etc., with list of stockholders and officers, and publish a statement of its financial condition as of some one day in the year. Needless to say the day selected was usually one on which the deposits, loans and resources would make a satisfactory showing, but about 1890 the legislature enacted a banking law, which has since been several times perfected by amendments, which brought this and all other State banks under its provisions, and the supervision of a State bank commissioner, with cast iron restrictions as to the relative amounts of loans, cash reserves, etc., and although some of the requirements seemed unduly severe to those accustomed to the former unrestrained exercise of their own individual judgment, few would now deny that it was wise and much needed legislation.

Following the retirement from the bank in 1891 of Judge Otis, Col. William Osborn became president, serving until his death, when R. A. Park succeeded to the office and served until his death in 1902. C. J. Drury being elected his successor and giving the institution his services for about a year, seconded by J. T. Hersey as vice-president, but both these gentlemen then retired 239upon the acquisition of a majority of the stock by Messrs. T. M. Walker, J. C. Fox and F. M. Baker. Of later years the growth of the bank has been marked, the capital and surplus having repeatedly been enlarged, and deposits and loans having shown a corresponding increase. The late Theodore Bartholow added his ripe experience as a successful banker to the board of directors, while F. G. Crowell, Joseph W. Allen, William Carlisle, with Messrs. Walker, Baker and Fox and others as stockholders and directors gave the institution a State-wide prominence.

R. A. Park, the second, who resigned as vice-president in 1911 to engage in business elsewhere, entered the bank in 1881; became cashier in 1892; elected vice-president in 1910, being succeeded as cashier by F. M. Woodford, who entered the bank’s employ in 1900 as bookkeeper.

C. W. Ferguson, formerly cashier of the Exchange National Bank, has recently been elected a vice-president of the Savings Bank, and the present officers and directors are as follows: T. M. Walker, president; Joseph W. Allen, vice-president; C. W. Ferguson, vice-president; F. M. Woodford, cashier; W. T. Fox, assistant cashier.

The German-American State Bank of Atchison was chartered May 15, 1912, and began doing business June 21, 1912. Its original board of directors was composed of Louis W. Voigt, Henry Klostermeier, William Klostermeier, F. A. Manglesdorf, L. A. Libel, G. T. Bolman, and F. A. Manglesdorf. Three months later the charter was amended and Charles Haase and W. A. Dilgert were added to the board of directors. This bank was organized with a capital stock of $50,000, and a surplus account of $10,000............