"The County National Bank," he said, "is facing a terrible crisis, Mr. Traver. I have come to discuss the matter with you."
"I am surprised to hear that, Mr. Delmar," responded Judge. "We have been experiencing an excellent period with the Trust Company. Perhaps — if I may presume — the fault lies in a lack of progressiveness within your organization. I have been injecting a new spirit into my own business. It might be a good plan for you to do likewise."
"We are losing confidence," declared Delmar, in a tired tone. "You must admit, Mr. Traver, that although business conditions are good in Middletown, there is a certain failing in the surrounding communities. Middletown has been drawing heavily upon the rest of the territory."
"Middletown is progressive."
"Do you think so, Mr. Traver? I have been here for many years, and in the present condition I see prosperity on the surface only. Considering the entire district of which Middletown is the center, I would say that the area is merely readjusting itself — not progressing."
"Our bank is showing a steady increase in deposits," declared Judge quietly.
"Of course, Mr. Traver," responded Delmar. "That is because you are serving Middletown alone, where expansion is evident—"
"Quite the contrary, Mr. Delmar," interposed Judge. "We are experiencing a tremendous development of our out-of-town accounts."
"That goes with what I have said," declared Delmar. "Everything is coming into Middletown. Tradesmen are bringing their businesses here. The farmers cannot bring their farms. So they are establishing their bank accounts in this community."
"Which helps your bank as well as ours."
"Hardly so, Mr. Traver. You know as well as I how the Middletown development began. Middletown spread. Our bank" — the old man spoke proudly as he remembered days gone by — "became powerful throughout the county. By mergers and expansion, we established branches in every community. There are many smaller banks that still remain. All are dependent upon the County National. As it goes, they go.
"Then Middletown began to contract. It had reached out with the tentacles of an octopus. It drew its arms in again, and brought in all that it desired. Our branch banks — the smaller banks which rely upon us — are nothing but suboffices. They are not supporting themselves. We keep them merely for the convenience of our depositors."
Judge nodded in agreement. Delmar, taking this as a sign of understanding and sympathy, continued.
"The founding of your bank, the Middletown Trust Company," he stated, "was a healthy sign. Middletown could use two banks. Smaller than the County National, you have never established branches. But now, people have commenced to neglect the branches. They come directly into Middletown, to find business here.
"We, at the County National, are getting a share of the deposits. You, at the Trust Company, are experiencing a supernormal growth. Every new out-of-town depositor in the Trust Company was formerly a depositor in the County National, or one of its subsidiaries."
"You are exaggerating, Mr. Delmar," said Judge. "Nevertheless, there is truth in what you say. I can tell you the answer. The Middletown Trust Company has adjusted itself to meet existing conditions. It is living in the future, not the past. The County National Bank has not adjusted itself. It is still trying to support past conditions."
"I agree with you," declared Delmar solemnly. "But I still insist that the present is not normal. In competing with the County National, the Middletown Trust should establish branch offices of its own—"
"But you have said," interrupted Judge, with a smile, "that branch offices are not profitable."
"Let me finish," begged Delmar. "You should establish branch offices, or we must eliminate ours."
"Now you have it," agreed Judge. "That is the solution, Mr. Delmar."
"The solution, yes," said Delmar wearily, "but it is unfortunately a dangerous solution. To attempt it at this time would mean disaster, Mr. Traver!"
"Why?"
"I have come here to tell you why. First, because we have lost so many depositors that our withdrawals have reached the status of a possible run on the bank. Second, because Harvey Bronlon has ceased to give us our share of his business.
"Those two causes may be linked, Mr. Traver. You know that Bronlon is the leading spirit of this entire region. His action injured us. Its result — the favoring of the Middletown Trust as Bronlon's bank — is likely to ruin us!"
"Let us hope not," said Judge quietly.
"Ordinarily," continued Delmar, with a touch of pride, "the County National would not fear this condition. But there is a third reason, Mr. Traver, which I feel that you should know. I am telling it to you in confidence."
Judge nodded as one banker to another. Delmar seemed at ease as he proceeded.
"We have suffered an unexpected loss," he declared, in a tragic tone. "Money has been stolen from our bank. I cannot state the exact amount. I can only say that it's many thousands." A look of consternation came over Judge's face.
"I know this amazes you, Mr. Traver," said Delmar. "Nevertheless, it is true. You will be more amazed when I add that we have not been able to trace the method of the removal, even though money has disappeared since we discovered it was going!"
Judge seemed to share Roland Delmar's worry now. He looked at the old banker in amazement.
"When did you first discover it?" questioned Judge.
"Last week," declared Delmar. "We put a man named Wellington on the job. Apparently a clerk in our bank, he is in reality a shrewd investigator. Wellington is cautious. He believed, today, that he could find something.
"He has a clue of some sort, but has not mentioned it. He said that would be bad policy. Tonight, however, he guarantees success. When he left my home, as I was coming here, he started directly for the bank."
"He is in there alone?"
"No. That is, only for a short while. I have sent Hubert Salisbury, my chief cashier, to join him. Wellington suggested that he would like to have a trusted man there."
"You trust Salisbury?"
"Implicitly, Mr. Traver. He is to marry my daughter, Martha. Hubert is an honorable young man, Mr. Traver — the very symbol of honesty and reliability. I trust him as if he were my own son."
"I understand," said Judge. "This worries me, Mr. Delmar. It worries me extremely."
"I thought you would appreciate my difficulties," said Delmar eagerly. "That is why I have told you everything. I wanted you to see the trouble — so that you would understand when I asked you this question: Can you, under the circumstances be ready to assist the County National in the emergency which confronts it?"
"I am sorry, Mr. Delmar," said Judge sadly. "In the light of what you have just told me, I could not possibly lend the aid of my bank."
Roland Delmar sank back in his chair with a deep groan.
"You appreciate my position," said Judge. "How can you ask me what you have? You have admitted that the County National has lost money through some unknown channel. To fill up the empty space, you would like me to supply you with funds — to make up for your neglect. Suppose the leak should continue — where would my bank be? No, Mr. Delmar. That is out of the question!"
"You can't refuse me!" exclaimed Delmar hoarsely. "Do you know what this means? The County National will be forced to close its doors. That will be a blow to the whole financial structure of this region. The run will be on your bank, Mr. Travel as well as on mine!"
"We shall be prepared for it," declared Judge. "Don't forget, Mr. Delmar, that should your bank fail, the Middletown Trust will offset heavy withdrawals with new deposits."
"We're not going to fail if I can help it!" declared Delmar, with a sudden grimness. "We have enough assets now to withstand tremendous withdrawals. But should the rate increase, or confidence be entirely lost, we would face the emergency that I have asked you to prevent."