More Gibsonizing

On the first business day of 1931, Harvey Dow Gibson, then chairman of the executive committee of New York Trust Co., and a group of wealthy friends bought control of Manufacturers Trust Co. from Goldman Sachs Trading Corp. They paid $7,300,000. The deal brought an end to much gloomy talk about Manufacturers Trust after its proposed merger with Bank of United States had fallen through (TIME, Jan. 12). When J. P. Morgan one afternoon walked out of his little grey banking house at No. 23 Wall Street and dropped in to see Mr. Gibson in his new office at No. 55 Broad Street, Wall Street felt this unusual act was a confirmation of the impression that Mr. Gibson had the support of the nation's strongest banking powers.

Under Mr. Gibson, who promptly succeeded Nathan S. Jonas as chairman of Manufacturers, the bank undertook the liquidation of many closed "neighborhood banks'' and thereby added to its goodwill and number of depositors (TIME, Sept. 21). From Jan. 3 to Nov. 28 its deposits rose 27%--$186,000,000 to $235,000,000.

While Manufacturers was waxing fat under its new regime, another prominent Manhattan bank was growing lean. Last Jan. 3 the deposits of Chatham Phenix National Bank were $17,000,000 greater than those of Manufacturers; on Nov. 28 they were $94,000,000 less. The loss had been 31% and accompanying it were many rumors, one of which caused the bank to order the arrest of a customer's man (TIME, Sept. 7). The case was not pressed, but loose talk continued. Widely expected was a merger involving Chatham Phenix and another large bank, two or three being mentioned.

Last fortnight Banker Gibson returned from a Thanksgiving Day spent in the country and began to figure and plan. Last week his directorate and the Chatham Phenix directorate had a session, voted unanimously to merge the two banks. The deal, to be completed in February in all likelihood, will consist of an exchange of stock. The Gibsonized banks will have total resources of about $550,000,000, deposits in excess of $400,000,000, creating the seventh biggest Manhattan bank.* No name had been chosen last week but it was announced that Banker Gibson will be chairman of the board and president. Louis Graveraet Kaufman, president of Chatham, was to be made chairman of the executive committee. General Samuel McRoberts, Chatham chairman, will resign from active banking, remain a director.

* According to latest New York Clearing House figures on deposits.

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