You can’t help but notice the building if you get caught by the red light at the intersection of Campbellton and Broad streets in downtown Douglasville. The tile work showcasing the business name, the little architectural flourishes that make the building so unique and the exquisite round and fan windows all boasting imported German glass takes you back to another time.
I’m referring to the beautiful Farmers and Merchants Bank building, of course. The location happens to be the original home to the second bank organized in Douglasville.
As the South moved from Reconstruction to the New South era there was a sudden spike in the number of applications for new national banking charters by businessmen who had taken over as the new leading class. These men understood the New South philosophy calling for changes in the Southern economy regarding industrialization, especially the textile industry.
Douglasville Banking Company, our first bank, opened in 1891. The space that bears their name now serves as the welcome center for the city of Douglasville.
The second bank, Farmers and Merchants Bank, was opened in 1907 with assets of $25,000. The Farmers and Merchants Bank was established after a visit from W.S. Witham, the founder of the Witham Banking System. Witham Banks were state banks, organized under Georgia laws with individual officers and directors and each had their own individual capital.
The Witham Banking System focused on small rural areas with populations of 1,000 or less. Mr. Witham would meet with local citizens and persuade them they needed a bank. My research indicates Witham was a masterful speaker and his position on the State Sunday School Board for the Methodist Church probably didn’t hurt either.
By the time the Farmers and Merchants Bank was organized in Douglasville Witham had approximately 80 banks in Georgia and Florida involved in his chain. Each member bank would appoint Witham as fiscal agent, and he would receive a fee from each location.
A 1916 Douglas County Sentinel article advises W. Claude Abercrombie served as president of the Farmers and Merchants Bank. His brother Joseph S. Abercrombie was identified as a stockholder. Rader Stewart was also involved with the bank.
I became very interested in the history of the Farmers and Merchants Bank when I noticed a small blurb in Fannie Mae Davis’ history of the county that read, “When hard times hit Douglas County in 1926 and 1927, the bank failed also, and it was taken over by the old Georgia State Bank (not affiliated by a more recent Georgia State Bank).”
Hard times hit before the actual Depression?
That sent me into heavy research mode to discover what happened to the Witham Banking System, and I found quite a bit.
At some point Witham basically retired from running the chain of banks and his assistant, W.D. Manley, took over. Manley had no previous banking experience and had only served as a cashier when he was first hired. Loyalty to Witham is what seemed to qualify him for the job.
Though he worked with Witham, Manley did not adhere to the same conservative course. The chain prospered and grew under his management, but it was a house of cards waiting to fall due to Manley’s creative financing.
Manley would borrow from bank A to buy controlling shares of bank B. Once he owned controlling shares of bank B, it was simple to get a loan from bank B to pay off bank A. The shares of bank B could then be used to purchase control in bank C.
While Witham had his Peachtree Street mansion Manley lived in grand style on Paces Ferry Road in an Italian style mansion complete with a butler, chauffeur, limousine and shopping trips to Europe for his family.
As Manley continued to use the member banks as his own personal cash drawer the banks began to fail, shattering the economies of Georgia and Florida. By the end of 1926, 150 banks in both states were closed and more than $30 million was missing.
Many depositors, including folks right here in Douglasville, lost their life savings.
THIS is part of the hard times Fannie Mae Davis alludes to in her book.
Manley was tried and was eventually convicted of “fraudulent insolvency.” He served seven years.
The bank building eventually became the home of Powell’s Groceries, and most people my age remember Douglasville Printing Company being in that spot for most of their lives.
Lisa Cooper writes the amazing stories of Douglas County each Sunday. You can also find her Facebook page for Douglas County history under the name “Every Now and Then,” and visit her website at lisalandcooper.com for even more stories.