the Canadian National Railway , whose director was also a director of the Home Bank , withdrew $ 1 million , and James Mason died of a self-inflicted gunshot in his office .
On August 18 , 1923 , following a normal day of trading and an emergency meeting , The Home Bank was shuttered with assets reported at $ 2.7m and liabilities of $ 15.5m . Henry Pellatt ’ s debts were said to be a contributing factor . The loss of Fernie ’ s only bank at the time was devastating , with deposits totaling $ 800,000 ; around $ 13 million today . War veterans lost the funds to pay their medical bills and widows were left without any savings . The Free Press of August 24 , 1923 , not knowing what was to come , put a positive spin on their reporting :
“ The news of the suspension of payment by the Home Bank of Canada , which arrived in Fernie on Friday evening last , gave the citizens of the town another jolt which momentarily knocked them off their feet .... While great inconvenience has been caused in a business way here by the suspension , things are gradually adjusting themselves and everyone just “ keeps on smiling .”
A local resident recalled the incident many years later :
“ I ’ ve lived all my life in this valley , and my dad was a miner . We used to say you put money under the mattress to save . I knew one man who kept his money in a coffee can instead of taking it to the
The Free Press , August 24 , 1923
bank . We found out later there was a lot of crookedness going on at the Bank . There was a lot of money stolen . That ’ s why it went broke . In our thinking , no ordinary working man would never , ever do anything like that to people . They were a different breed of people , the top brass , and they did things that were not good .”
- Grace Dvorak , Fernie , B . C .
10 directors were arrested and jailed in 1924 , although all but one of the convictions were later overturned . Small depositors were eventually reimbursed to the tune of 60c on the dollar , up to $ 500 . There was no insurance for larger depositors . The failure was the subject of a Canadian Royal Commission which inspired banking reforms which have protected Canadian investors to this day and since 1923 , no Canadian banks have failed .
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