Grayson County State Bank (Leitchfield, KY)

Episode Information

Episode UID
1967443391563
Episode Type
Suspension → Closure
Bank Type
state
Bank ID
196744339 hash
Start Date
March 11, 1930
Location
Leitchfield, Kentucky (37.480, -86.294)

Metadata

Model
gpt-5-mini (chosen from majority vote of a three-model LLM ensemble)
Short Digest
469236afec3b8350

Response Measures

None

Description

Directors voluntarily closed bank and turned it over to the State Banking Department for liquidation.

Events (3)
1. March 11, 1930 Receivership
Newspaper Excerpt
organization turned over to the State Banking Department ... work on which started Wednesday morning. the bank will be placed in the hands of a liquidatagent who will take care of the collection of loans as they fall due.
Source
newspapers
2. March 11, 1930 Suspension
Cause
Voluntary Liquidation
Cause Details
Board of directors ordered closure due to frozen loans, crop failures, depressed business, inability to obtain cash on collateral and past-due loans.
Newspaper Excerpt
The Grayson County State Bank ... closed its doors Tuesday morning, March 11, at the order of the board of directors
Source
newspapers
3. July 22, 1935 Other
Newspaper Excerpt
The Grayson County State Bank building was sold here Monday preparatory to closing out liquidation of the bank's business which failed on Tuesday, March 11, 1930.
Source
newspapers

Newspaper Articles (3)
1. March 14, 1930 The Leitchfield Gazette Leitchfield, KY
Article from The Leitchfield Gazette, March 14, 1930

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Article Text

Doors of Grayson County State Bank Closed Tuesday Financial Institution of Long Standing Halts Operations At Order of Board of Directors Monday Night BANK BOOKS ARE NOW BEING AUDITED The Grayson County State Bank, founded here by R. C. Hazelip in 1886, closed its doors Tuesday morning, March 11, at the order of the board of directors, following meeting of the board Monday night. A notice posted on the door, stating that the bank was closed, awaiting action of the State Banking Department, which was notified early Tuesday morning of the step taken. Tuesday night, after the arrival of W. A. Dicken, deputy banking commissioner of Frankfort, and D. Archibald, bank examiner of Louisville, second meeting of majority of the directors was held, and the organization turned over to the State Banking Department. complete audit of the bank's books be made, work on which started Wednesday morning. It will be several days before the audit completed after which the bank will be placed in the hands of a liqudatagent who will take care of the collection of loans as they fall due. Gayle Prather, cashier and vice president of the bank, emphasized the fact that the closing was voluntary action by the directors and that there would be no shortin the funds. "There is no shortage and the bank's books balance,' asserted Mr. Prather, who attributes the finantrouble to frozen loans, crop failures, depressed business conditions, as well as the fact that much has out of the bank money gone into investments outside of the county "Inability to obtain more cash from city banks collateral was the immediate difficulty," the cashier said Tuesday. There had been some withdrawal of accounts recently, but no run on the bank. Deposits had fallen to $360,000 from over $400,000 at the beginning of the year. The bank has $370,000 out on loans and a number of notes past due. trouble started in farm loans during the World War," the cashier said. "There number of second mortgages. In 1927 the stockholders voluntarily made 100 per cent assessment to relieve the isting condition when the bank was

2. March 19, 1930 The Kentuckian-Citizen Paris, KY
Article from The Kentuckian-Citizen, March 19, 1930

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Article Text

Grayson State Bank Closes Its Doors Leichfield, Ky, March 13.-The Grayson County State Bank, a prominent financial institution here for half a century, closed its doors Tuesday morning. A notice posted stated that the bank was closed by order of the board of directors, awaiting action by the State Banking Department The last official statement of the bank December 31 showed capitalization of $25,000, deposit over $400,000 and surplus of $7,500. Gayle Prather, cashier, emphasized that the closing was a voluntary action by the directors, decided at a special meeting Monday night. "There is no shortage and the bank's books balance." asserted the cashier, who attributed the financial trouble to frozen loans, crop failures and depres ed business condition. O. S. Denny, State banking commissioner, was notified of the action and promised to send an examiner to make an audit. "Inability to obtain more cash from city banks on collateral was the difficulty,' said Mr. Prather. There had been some withdrawals of accounts recently, but no run on the bank. Deposits had fallen to $360,000. The bank has $370,000 out on loans and a number of notes are past due. "The trouble started in farm loans during the World War," the cashier said. "There are a number of second mortgages. In 1927 the stockholders voluntarily made a 100 per cent assessment to relieve the situation. With real estate valués declining and crop failures occurring the amount was not suffcient."

3. July 26, 1935 The Leitchfield Gazette Leitchfield, KY

Article Text

BANK BUILDING IS SOLD FOR $6900 Aubrey Moorman Buys Structure Here Monday After Lively Bidding The Grayson County State Bank building was sold here Monday preparatory to closing out liquidation of the bank's business which failed on Tuesday, March 11, 1930. Aubrey Moorman, insurance agent and local manager for the Kentucky Public Service Company, was high bidder, offering $6900. Notes held by the bank aggregating approximately $34,000 were sold to Carl Boone, attorney for the bank, for $127. Three sales were necessary to complete the sale of the building because of a mixup. Before the final sale, the bid had run over $7000. The bank will probably pay depositors another dividend of about ten per cent, according to Frank Gardner, Special Deputy Banking Commissioner in charge of liquidation proceedings for the past two years. Early in December of last year the Leitchfield Deposit Bank made a deal for purchase of the bank building, offering 8,000 for the structure. However, sale of the building at that time was refused and a court decision held that no binding contract for the sale was made. Included in the building besides the banking business are offices and storage space of D. G. Hayes Wholesale Grocery and dental offices of the Drs. Richardson.