Payson's first bank opened in 1916. It was called Payson Commercial and Trust Co. and was incorporated by W.H. Hilligass, John McCormick, Ralph Hubert, H.L. Castle, and A.T. Hammons. This bank would operate for 16 years before closing under questionable circumstances in 1932.
This bank was a little different than today's banks. Article II of its Articles of Incorporation states, "the general nature of the business proposed to be transacted by the corporation shall be a general mercantile and banking business; and in that connection the keeping of stores; buying, procuring and selling merchandise of whatsoever kind and nature; to receive deposits, to loan money..."
Payson Commercial and Trust was a store, as much as it was a bank.
Just two annual reports are available for Payson Commercial and Trust. The first, from June 30, 1916, shows assets of $98,016.07 and liabilities of $95,544.95. Ralph Hubert was the president of the company and A.T. Hammons was the secretary.
The second annual report available appears to be from Feb. 18, 1924. This report shows assets of $79,670.96 and liabilities of $75,426.86.
The president of the bank in 1924 was still Ralph Hubert, while Mart McDonald was the vice-president and Charles Chilson was the secretary.
Throughout the Roaring Twenties, it seems that this bank continued to prosper -- or at least stay in business. Hindsight, however, is 20-20, and after the bank's closing it appears that some things may not have been right for a while.
The Reno Evening Gazette from April 19, 1932 has some interesting things about why the bank had just closed.
"GLOBE, Ariz. April 19 (AP) -- The Payson Commercial and Trust Company at Payson near here, was closed today under circumstances not fully divulged.
"County Attorney R. W. Hill said tonight that Ralph Hubert, president of the bank, had made a statement in a conference in his (Hill's) office that he had closed the bank because of shortages extending over a period of four years, which have been so covered up they have not been discovered by the banking department.
"Hill said Hubert did not explain the "full import" of his statement. The prosecutor said he would take no action, if any, until after a report from state bank examiners.
"Hubert would say only that ‘demands were made on the bank this morning which I could not pay.'
"At the last bank call, last December 31, the bank reported deposits of $38,597.26 and total assets of $72,976.80."
Less than a month later another AP story can be found, this time in the Fresno Bee, which explains some of what happened
"Ralph Hubert, president of the Payson Commercial and Trust Company Bank, which closed its doors April 18th, was sentenced to serve five years in state's prison for misapplication, of the bank's funds."
Indeed, Hubert went to jail after the bank's closing. He was charged with seven counts related to the bank's failure. He pleaded guilty to all of these counts on April 30, 1932. Another person, Walter Bassett, who appears to have been the bank's cashier, was charged. He was charged with the same seven counts as Hubert, went to trial, and was found not guilty.