‘Bank holiday’ no picnic in 1933

    Editor’s note: The following information on Farmer’s National Bank is included in Cora M. Putnam’s “The Story of Houlton”, published in 1958 by House of Falmouth, Inc. of Portland, Maine.
    The Farmer’s National Bank was organized in Houlton in 1890 with capital of $50,000. Its first officers were: President, Lewis B. Johnson; Cashier, Walter F. Titcomb. The first Board of Directors consisted of: Frederick A. Powers, John S. Weiler, Simon Friedman, Charles E. Williams, Joseph A. Browne, Lewis B. Johnson, Oscar F. French, John C. MacIntyre and Leland Ludwig.
    For many years this bank was known as Lew Powers’ Bank because Governor Llewellyn Powers owned the majority of the stock. This bank was closed during the bank holiday (see below). James Madigan was appointed Receiver. It should be noted that the depositors of this bank fared not too badly despite the fact the bank was closed for the holiday, as the depositors recovered ninety-one cents on the dollar. The Farmers National Bank owned the block on Main Street in which it was located and its equipment included a substantial vault. The bank did not reopen and the building, in due time, was purchased by the J.A. Harvey Insurance Company.
    Today the former bank and its “substantial vault” is home to The Vault Restaurant.
    According to the online dictionary Wikipedia, the United States Bank Holiday took place during the Great Depression in 1933 when President Franklin D. Roosevelt closed all banks from March 6 through March 10 to keep depositors from bankrupting the entire banking system by withdrawing all their money.
    Banks were allowed to reopen when they could prove that the money in their reserves were greater than or equal to the money that had been deposited in. If the banks were unsound they would stay closed or apply for a government loan in order to keep from declaring bankruptcy.
    Also, from Wikipedia, the Federal Deposit Insurance Corporation (FDIC) is a United States government corporation created by the Glass-Steagall Act of 1933. It provides deposit insurance which currently guarantees checking and savings deposits in member banks up to $100,000 per depositor. The vast number of bank failures in the Great Depression spurred the United States Congress into creating an institution that would guarantee deposits held by commercial banks.