Word: rfc
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...barely saved when twelve Philadelphia banks, investing in panic-prevention, pledged it $50,000,000 credit, deposited $12,000,000 cash. Later the twelve banks, backed up by Reconstruction Finance Corp., forced the resignation of the president, hired instead short, short-tempered George Washington Brown Jr., RFC's former Philadelphia manager...
With all the heat turned on, George Washington Brown could not thaw the frozen assets fast enough. In 1934 RFC had helped by buying $4,000,000 preferred stock on condition that the twelve banks would use $3,000,000 of their $12,000,000 deposited with Integrity Trust to buy a second preferred issue, give promise they wouldn't scuttle and run. Still the assets refused to thaw...
Whether FDIC will get its money back depends on how much it can realize on Integrity's remaining assets, valued on the books at $28,000,000. It hopes not to lose more than $2,500,000. RFC's $4,000,000 of preferred stock, the twelve Philadelphia banks' $3,000,000 of second preferred, the holdings of the common stockholders (priced at $215 a share in 1929) were left in the cold. To George Washington Brown went the compliment of being asked to serve as liquidator of Integrity's frozen assets...
...interest were paid on loans, sinking fund charges and the accumulated deficit, little more than $500,000 would have been left to run the city government in 1939. The emergency was met then by hocking the city gas works to the RFC, obtaining a $41,000,000 loan and clearing the slate of past deficits. But sacrificed by this legerdemain was $4,200,000 a year for 20 years to come which the city would have realized from renting its gas works to the operating company...
...better than cannon in dealing with the New Deal. Fortnight ago, he hired a new president for Standard, white-haired, McNuttish-looking Leo Thomas Crowley, since 1934 chairman of FDIC. He hired Mr. Crowley through Washington's No. i Big Money employment office, Jesse Jones's RFC, the same office which placed Mr. Crowley's FDIC predecessor, Jones Protege Walter Cummings (TIME, Nov. 27), who heads Chicago's huge Continental Illinois Bank...