Payson Commercial & Trust



Photo courtesy of The Northern Gila County Historical Society

Payson’s first “real” bank was the Payson Commercial and Trust Co., and it was also a mercantile. Started in 1916 it came to a bitter end in the early 1930s the victim of a variety of things, including the times — it was The Great Depression.

Many say that the United States has its worst economy since the 1930s. It’s worth noting that even the little town of Payson was not immune to a key widespread problem during the 1930s: bank failures. Here’s the story of Payson’s first bank and how it collapsed during the Great Depression.

Payson’s first bank opened in 1916. According to the 1916 Arizona State Business Directory, Payson had just 150 people and farming, livestock, and mining were its industries. The bank was called Payson Commercial and Trust and was incorporated by W.H. Hilligass, John McCormick, Ralph Hubert, H.L. Castle, and A.T. Hammons. Hubert was the key player behind this bank. He’d had a store just before this in Payson, was patenting land in Payson at the time, and would serve as bank president throughout the bank’s history.

This bank was a little different than today’s banks. Article II of their 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.

During the 1920s, Payson grew substantially. According to the 1930 Arizona State Business Directory, Payson had a population of 500, a tripling in population compared to 1916. Undoubtedly this population growth helped the bank prosper, but dark clouds were on the horizon – as was the case with the entire U.S. economy of that time.

The Reno Evening Gazette from April 19, 1932 has some interesting things about why the bank had just closed.

“GLOBE, Ariz. Apr. 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.”

The previous story has some eerie similarities to stories published in the past year about the financial crisis on Wall Street.

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.”

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.


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