First State Bank History

Larned Background up to July 5, 1896 ● Founders of the Bank - 1900 ● Larned Business - 1904 ● H. H. Reed - World War I ● John Wagner - 1933 ● 1933-1949 ● 1949-1959 ● 1959-1967 ● Reed Peters - 1975 ● New Building - 1989 ● 1986-1996 ● 100 years ● Begin the Next 100 Years ● 2000's

Larned Background up to July 5, 1996

In June of 1996 the Larned Tiller & Toiler (Larned's newspaper) published a series of articles on the history of The First State Bank from it's beginning in June of 1896. This is the first of twelve pages of text and pictures, most of which came from those articles.

THIS IS HOW IT ALL BEGAN

The more things change the more things remain the same. That statement can definitely be said of First State Bank of Larned. First State Bank was built on a foundation of a sound banking philosophy and a genuine concern for their customers. June 30, 1996, marked the Centennial of the First State Bank & Trust Company of Larned. During that time the city of Larned, the state of Kansas, and the United States of America have been witness to a rapidly changing world. Technology is now pushing us into the 21st century and the computer age is here. The founding fathers of Larned would not have dreamed of the modern day conveniences we now take for granted in our everyday life.

To see how far we've come we need to journey back into the 1800s. . .

In the thirty years following the Civil War, Kansas was working its way out of pioneer conditions when the plains were first being settled. They were troubled by the Indians in the 1860's, and the grasshopper infestations of the 1870's.

During the 1880's a confidence was being felt in the future of Kansas as a state, and people from the East were eager to invest in its land and property. Money was easy to borrow and Kansas people borrowed liberally as they began speculating in real estate. Kansas was on the "Boom". Property was bought not to actually use for the buyer, but to resell again at a higher price. Cities and towns laid out expensive additions with expensive improvements. Business buildings were constructed far larger and more costly than the needs of the time demanded. Railway and street car lines were built even where there were not enough businesses built to support them. Hundreds of towns were mapped out across Kansas and lots were sold. Many of these towns never existed except on paper, most others were later turned into pastures and corn fields.

THE GROWTH OF LARNED IN THE 1880'S

It was in July of 1872 that the railroad track laying gang arrived at the Larned townsite and then continued pushing on southwest toward Fort Dodge. It was the laying of the railroad through Larned that first put the town of Larned on the map.

In 1880, J.W. Rush & Company was established in Larned. The First National Bank was organized in 1881 with J. W. Rush as President. He also served as a Kansas state senator. In 1883, J.W. Rush built a Victorian style structure for the location of First National Bank. It was built with red brick and had a gabled facade, and was located on the northeast corner of 5th and Broadway. This building would later become the home of First State Bank.

In 1885, The Larned State Bank opened its doors with Captain Clark Gray as President.

In October of 1886 Larned's street railway began running. Mules furnished power for the streetcars as they ran north from 4th and Main to the Missouri Pacific Depot with a branch down 5th street to the Santa Fe depot. As long as the businesses thrived two cars were operated. Each with a two man crew - a conductor and a driver.

In 1886, the Phoenix building was built at 519 Broadway. At the time it housed the Phoenix Bank which was chartered on April 18, 1886. Just down the street at 529 Broadway in the Masonic Building the Pawnee County Bank was chartered on April 7, 1886.

THE END OF THE KANSAS BOOM

The Blizzard of 1886 took its toll wiping out herds of cattle on the Kansas plains. Even so the boom of Kansas did not subside until the drought of 1887.

Larned did not feel the pinch of the boom immediately. The city incorporated at second class status.

It was in 1887 that the Larned Opera House was built on the east side of the 400 block of Broadway. The following is a description of the opera house from the October 1888 issue of the Kansas Land Guide - "The auditorium, located upon the second floor is semicircular, uniform and divided into orchestral, dress circle, parquet, and balcony seats. There are four private boxes on either side of the stage. The woodwork inside is finished in cherry. The scenery was painted by one of the best scenic artist in the west and is very fine. The stage, with one exception is the largest in the state. The entire building is lighted with gas . . . Four large storerooms with iron pillars and plate glass fronts occupy the first floor."

Other buildings that were erected in Larned in the late 1880's include the Masonic Building at 6th & Broadway, and the Methodist, Baptist, Episcopal, and Presbyterian Churches.

The ornate hotel on the northwest corner of 8th & Broadway which is the present location of the Larned Post Office was also constructed in the late 1880's. It was known as the Levy Grande, the L'Grande and the St. Charles. Larnedites boasted it as the finest hotel between Kansas City and Denver. It was built by Wichita interests and headed by a man named Levy. This 3-story brick and stone building contained 60 guest rooms and a dining room. On April 24, 1888, Dodge City's famed Cowboy Band played for the opening of the Levy Grand hotel. This hotel later burned to the ground.

The collapse of the boom came in 1887 when new settlers who were not familiar with the soil and climate conditions of Kansas, found that they had not selected land adaptable to agriculture and therefore farming was not profitable. Add to that a severe drought which was worse than any known before. People lost confidence in Kansas and the boom of Kansas collapsed. The people from the East wanted their money back but there was nothing to give them. Money could not be borrowed and mortgages were foreclosed. People who had bought property at high prices couldn't sell at any price. Many who counted themselves wealthy found their property valueless. Banks and businesses failed and hundreds of people were ruined. Thousands left Kansas and some western counties were left almost abandoned.

The year 1887 was followed by several good crop seasons. A great deal of attention was then given to study farm conditions, and Kansas once again began to make progress.

In 1888 Larned had five banks, the Larned State Bank, Phoenix State Bank, Pawnee County Bank, People's Bank, and First National Bank.

A six inch vein of coal was discovered in 1888, at Larned in Captain C.A. Morris's well and a 10" vein in D.H. Scott's well. This finding created excitement in the community since coal was a source of fuel and fuel was scarce on the treeless plains. The Morris Well had coal at 65 feet and the Scott well had coal at 104 feet. In 1889 the city voted a $5,000 bond issue for mineral development, and an experimental hole was drilled which yielded only salt water. The project was abandoned but revived a few years later when the salt well became a source of water for a salt lake development. It became the population's health and recreational resort in the 1890's.

In 1889 Kansas had the biggest corn crop in the state's history. The grain markets had gone downhill at this time though so the farmers sold their corn for only 10 cents a bushel. Some farmers even burned their crop in their heating stoves.

April 22, 1889, was the opening of Oklahoma for settlers at in which time Kansas lost about 50,000 of her population. People lined up at the southern border of Kansas for high noon, a time the President announced that the settlers could take claims in Oklahoma, and awaited the shots fired by the cavalrymen. A great shout went up and the race for claims began. Hundreds crowded the trains, thousands rode on fleet horses, many rode in buggies and buckboards, others in heavy farm wagons, and some even made the race on foot. In the morning Oklahoma was an uninhabited prairie, at midday it was a surging mass of earnest excited humanity, in the evening it was a land of many people.

In the 1890's the backwash of the boom hit Larned and Pawnee County. Banks failed, business firms closed, and people moved away. The population dropped to 1,800. At this time the street car business first felt the pinch. Service curtailed to one car and Andy Kenslar was both driver and conductor. It got so lonesome that sometimes he asked pedestrians to ride just for company. Then operations suspended and the equipment was sold. E.E. Frizell later bought the rails and had them cut up and sold them to farmers for fence posts.

Financial panic extended over the whole country in 1893 which was accompanied in Kansas by a partial failure of their crops. Those were dark days in Kansas for many people who were still burdened with heavy mortgages. Most of these mortgages were held by money lenders in the east and Kansas became known as "Mortgaged to the East".

BANKS CLOSE THEIR DOORS

Considerable excitement was caused in Larned on June 10, 1896, when it was announced that the First National Bank had closed its doors. Early that morning several ugly rumors were started in regard to condition of the bank. This caused the depositors to become frightened, and as soon as the bank opened a run was commenced, which lasted until about three o'clock when the bank officials found themselves without money and were compelled to close the doors. Cashier Norwood informed the Chronoscope that the bank was never in better condition than at the present time and the inability to get cash here from their eastern depositories in time was the only cause of suspension. J.W. Rush, manager of the bank, was in Chicago at the time and as soon as he returned the bank would re-open and all the depositors would be paid in full. The following notice signed by the directors was posted in the bank window Thursday morning: "This bank is temporarily closed. Depositors need not be alarmed. They will all be paid in full without loss of a cent." Just before going to press the Chronoscope received the following information from F.D. Lowrey who received the following dispatch from Mr. Rush dated at Chicago: "Just received word regarding the bank. This is the work of my enemies. Plenty money to pay everybody. Home Friday night at eight thirty." The Chronoscope further reported "The bank has a deposit of about forty-five thousand dollars and is considered one of the strongest in the state and the failure to get money in time from Kansas City is the only cause for its suspension. Our citizens can rest assured that they will receive every cent of their deposits as soon as Mr. Rush can return home and get the bank opened." First National Bank was never reopened. The bank was taken control of by the comptroller of the currency and placed in charge of Bank Examiner Stainsby, who checked the books of the bank.

Prior to this the Phoenix Bank had closed in January 1889. The People's Bank had closed on September 25, 1891, with all of its fixtures sold and deposits transferred to the Larned State Bank. The Larned State Bank was closed on July 3, 1893, along with the Pawnee County Bank which closed on July 1, 1893.

A NEW BANKING ERA

Larned was out of a banking institution for three weeks following the closing of First National Bank. The business men of Pawnee county were at a great disadvantage in trying to continue to run their businesses. On July 3, 1896, the Tiller and Toiler announced "Last Tuesday morning our people were gladdened to learn that a new financial institution, known as the First State Bank of Larned had opened and was prepared to accommodate the public. The new bank is organized by some of our most trustworthy and substantial citizens." F.D. Lowrey was President and Timothy McCarthy was the Cashier. The bank was opened at the building formerly occupied by the Pawnee County Bank at 519 Broadway.

"It is the sincere desire of our entire population that the bank be a useful public institution and may long continue to do business and prosper. The wholly unnecessary run on the First National Bank was most unfortunate and only the crop failure is more calamitous to our businessmen. The new institution seems to have gained the confidence of the people and many deposits have been made since it began business," stated the Tiller and Toiler.

First State Bank was chartered on June 25, 1896, with a capital of $5,000. The Board of Directors included F.D. Lowrey, President; Timothy McCarthy, Cashier; E.E. Frizell, L.A. Choat, and H. M. Halloway. Timothy McCarthy invested 74% or $3,700 of the outstanding stock, with L.A. Choat investing $1,000, and Lowrey, Halloway, and Frizell each investing $100.

For six days First State Bank was the only bank in town. On July 5th, Mr. A.H. Moffet opened an office of the Moffet Brothers State Bank in Larned. This bank was started in 1889 in Garfield as the Moffet Brothers Private Bank and Mercantile Co. and had survived those difficult years. The name was changed to First National Bank in Larned on March 21, 1922. It was located at 419 Broadway in the building that now serves as the Larned Police Station.

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