Since bank failures are in the news now, and since there's another thread here at Knoxviews discussing a novel that's apparently a roman a clef about the Butcher brothers...
what are your memories of the failure of United American Bank and the rest of the Butcher banking empire?
continued...
For my part, I was in high school back in February of 1983. On Friday the 11th, Knoxville was abuzz with rumors that UAB was insolvent. Despite reassurances that
- it wasn't
- even if it was, the FDIC would cover deposits
there was basically a run on the bank. KNS had photos of looooooong lines at the ATM's. But they remained open until their normal closing time Friday.
In that Sunday's KNS, UAB had a two page ad that basically said "yes, we did have problems, but we've resolved them, and we'll be open Monday, with coffee and doughnuts for our loyal customers. Thanks for your support."
My uncle worked for UAB at the time (I think as a branch manager) and he said, at least from what he was told, the management really did believe they had saved the bank, and they were fully prepared to re-open as normal (well, as close to normal as a bank that had experienced a run could be) that Monday.
Come Monday morning. It was about 8:20 AM, because I was on the way to school. Radio programming was interrupted with the news the FDIC had closed down UAB. I can't remember for sure if they immediately announced First Tennessee was taking them over or not.
That, of course, set off a collapsing house of cards, with pretty much every Butcher bank failing over the next few weeks. Most memorable beyond UAB was CH Butcher's Southern Industrial Banking Corporation. That was notable because, as it turned out, it was not a "bank", it was a "banking corporation", and hence, not FDIC insured. As I remember, depositors did eventually get their money back, but it took a long time.
Both Butcher brothers and their dad did prison time (or was the father spared prison time due to his age?) CH is dead; Jake is rumored to be working for a Toyota dealer in Georgia.
|
|
Discussing:
- Wonder what Kane thinks? (3 replies)
- Parking in Knoxville (2 replies)
- Nationwide 'Hands Off' Protests today, April 5, 2025 (5 replies)
- Burchett at Cotton Eyed Joes last Saturday (3 replies)
- China imposes 34% reciprocal tariffs on imports of US goods in retaliation for Trump’s trade war (2 replies)
- Liberation Day 2025 (3 replies)
- Bird flu, new pandemic? (1 reply)
- Horse of a Different Color: a Political Fantasy (2 replies)
- With Musk’s U.S. DOGE Service in charge, is Social Security breaking down? (1 reply)
- This presidential administration has no ethics? (2 replies)
- Burchett and Schumer got it right (3 replies)
- ‘A disruptive effect’: How slashing staff at the Social Security Administration is sparking fears the system could collapse (5 replies)
TN Progressive
- The Meidas Touch (RoaneViews)
- Massive Security Breach Analysis (RoaneViews)
- What Trae Said! (RoaneViews)
- Ever Seen a Cover done this fine? (RoaneViews)
- (Whitescreek Journal)
- Lee's Fried Chicken in Alcoa closed (BlountViews)
- Alcoa, Hall Rd. Corridor Study meeting, July 30, 2024 (BlountViews)
- My choices in the August election (Left Wing Cracker)
- July 4, 2024 - aka The Twilight Zone (Joe Powell)
- Chef steals food to serve at restaurant? (BlountViews)
- Blount County, TDOT make road deal for gun mfg ignoring town of Louisville,TN, (BlountViews)
- Winter at the Big Rocks (Whitescreek Journal)
TN Politics
- Gov. Bill Lee wanted $100M for Duck River projects. Lawmakers approved $65M (TN Lookout)
- Stockard on the Stump: Tennessee immigrant student bill losing momentum (TN Lookout)
- Civil rights attorney to sue Knox County sheriff, UT Medical over deaths of Black men (TN Lookout)
- U.S. Supreme Court to hear case on Trump’s birthright citizenship order (TN Lookout)
- Federal appeals court temporarily freezes multibillion-dollar Biden climate fund (TN Lookout)
- Tennessee lawmakers set no good example for “success sequence” bill (TN Lookout)
Knox TN Today
- Lady Vols softball finds its footing (Knox TN Today)
- Headlines 4/18: U.S. hostage to no THCA in Tennessee (Knox TN Today)
- Using windows for cat enrichment (Knox TN Today)
- Knox the Fox & the Smokies (Knox TN Today)
- Harrington hikes Chestnut Top Trail to find numerous wildflowers (Knox TN Today)
- Deaf Awareness Day at Zoo Knoxville (Knox TN Today)
- Dining Duo reminds of local favorite (Knox TN Today)
- Are you future ready? (Knox TN Today)
- Annual Irwin Food City Bass Tournament: Registration open (Knox TN Today)
- The Outlandish Adventure Festival coming in May (Knox TN Today)
- Tulip time (Knox TN Today)
- Wildflower interlude (Knox TN Today)
Local TV News
- TWRA: 3 bears 'lethally removed,' including 2 yearlings, after report of woman bitten and dragged from porch (WBIR)
- Parents react to proposed price increase for school meals in Knox County (WATE)
- Three facing murder charges in two drug-related deaths in Knoxville (WATE)
- 'Eggs are triple what they were': Shoppers see increase in cost of celebrating Easter (WATE)
- Three bears killed after report of aggressive behavior near Gatlinburg (WATE)
- Firefighter injured in North Knox County modular home fire (WATE)
- One dead after house fire south of Pigeon Forge (WATE)
- East TN nonprofit reacts to AmeriCorps cuts, reducing number of volunteers available to uplift communities (WBIR)
- UT student hopes his parking lot business will address downtown Knoxville parking woes (WBIR)
- Alcoa City Schools holds charity ball games for student diagnosed with rare juvenile ALS (WBIR)
- Family of man who died in January from meningitis infection prepares to sue UT Medical Center for malpractice (WBIR)
- Indictment: Friend of Kenneth DeHart helped him avoid arrest after he killed Blount Co. deputy (WBIR)
News Sentinel
State News
- Remember When, Chattanooga? Golden Gallon was the place to buy milk - Chattanooga Times Free Press (Times Free Press)
- Q&A: National Park City creator discusses concept and what it entails - Chattanooga Times Free Press (Times Free Press)
- Marketing efforts for the Sequatchie Valley National Scenic Byway honored - Chattanooga Times Free Press (Times Free Press)
- Opinion: Weekend Dialogue — More about me, the Times editor - Chattanooga Times Free Press (Times Free Press)
Wire Reports
- How Universities Became So Dependent on the Federal Government - The New York Times (US News)
- Trump Officials Blame Mistake for Setting Off Confrontation With Harvard - The New York Times (US News)
- US bond markets: Why everyone is watching them closely - BBC (Business)
- Venezuelan migrants ask US Supreme Court to halt 'imminent' deportations - Reuters (US News)
- Judge blocks Trump administration from passport changes affecting some transgender Americans - AP News (US News)
- Survivor, witness describe FSU terror: 'Yeah, keep running,' the gunman said - NBC News (US News)
- Judge says detained Tufts student must be transferred from Louisiana to Vermont - Politico (US News)
- Designed in US, made in China: Why Apple is stuck in tariff tussle - BBC (Business)
- Trump studying whether to fire Fed Chair Powell, adviser says - Reuters (Business)
- Van Hollen describes dramatic meeting with Abrego Garcia in El Salvador upon return to US - ABC News (US News)
- Visas for 15 Auburn students, staff revoked in immigration crackdown: ‘Political ping pong’ - AL.com (US News)
- Ford halts shipments of vehicles to China amid tariffs - Reuters (Business)
- Mass layoffs paused at Consumer Financial Protection Bureau - Government Executive (Business)
- The Capital One merger with Discover just cleared a major hurdle - CNN (Business)
- Here’s an Analyst’s ‘Worst-case Scenario’ for Google’s Antitrust Cases - Barron's (Business)
Local Media
Lost Medicaid Funding
Search and Archives
TN Progressive
Nearby:
- Blount Dems
- Herston TN Family Law
- Inside of Knoxville
- Instapundit
- Jack Lail
- Jim Stovall
- Knox Dems
- MoxCarm Blue Streak
- Outdoor Knoxville
- Pittman Properties
- Reality Me
- Stop Alcoa Parkway
Beyond:
- Nashville Scene
- Nashville Post
- Smart City Memphis
- TN Dems
- TN Journal
- TN Lookout
- Bob Stepno
- Facing South
One of my mother's best
One of my mother's best friends worked for Hamilton National Bank in the old building on Gay at Clinch and later for UAB. She told Mom that the office morale skyrocketed when Jake took over the bank. She remembered how all her friends just gushed over him whenever he visited. All her fellow 'little people' were charmed by him.
She lost all of her retirement savings when the whole thing crashed.
Visit us at:
The Home
Lucky us, we were moving to
Lucky us, we were moving to Florida in February, 1983. It wouldn't have mattered, we did not bank with UAB and had no savings even if we did bank with them. We banked with Park and Bk of Maryville. I don't even remember knowing anyone who lost their money at UAB. It could be most everyone we knew at the time had no savings.
I was on the air that
I was on the air that morning that Jake's bank crashed and it was WIVK reporter Dan Bell who went through the HQ drive-in window to get some comment since the bank itself was not open that early. As I recall, the teller at the window learned from him that the bank had failed. I also think it was Valentine's Day. Most of the major losses were to investors with CH's outfit, Southern Industrial Banking Corp. No FDIC protection there. Interest rates were multiples of those at FDIC insured institutions and while I'm very sorry for people who didn't pay attention to the danger and lost houses and life savings, it seems to me foolhardy to believe there's something for nothing. However, we've seen that happen a lot lately, haven't we?
I worked for the old Bank of
I worked for the old Bank of Knoxville at the time of the SIBC collapse. I well remember an older couple withdrawing their life savings (about $30,000) from our bank and taking it to SIBC shortly before the collapse. Nothing that I said could deter them. SIBC was offering ridiculously high rates. I told this couple that perhaps they should wonder why the bank was willing to offer such high rates; why were they so desperate for depositors. I reminded them that SIBC was not a bank and was not federally insured. I almost had the husband convinced but the wife felt that SIBC was secure since they had been in business for so long. A few weeks after the collapse they came to me and told me they wished they had listened to me. I felt so bad for them and knew that there were many other folks just like them.
snow??????
did it snow the day the banks fell?
Snow
It might have... My strongest memory was going down to a neighbor's house to watch TV and every other commercial was for Southern Industrial Banking Corporation. That is not an exaggeration. That jingle still plays in my head. 2 days later SIBC failed. A few months later that house got foreclosed on as my friends' landlord was in with the Butchers.
I had a mortgage with Knox Federal at the time which got sold off to Charter Federal after Knox federal failed, then I think Charter Federal failed and it got shuffled to another bank or 2 before it got paid off. A lot of seemingly unrelated S&Ls got sucked into the UAB demise.
I remember thinking after the Worlds Fair "I owe more on this loan than the house is worth" but never once considered walking away from the house. Now it brings in more income in 2 years than that entire loan balance. Witness the power of inflation. Or gentrification. Or gentiflation, I suppose.
My neighbors' house is now a 5 story condo. For better or worse. Mostly worse. I wonder how many of the condos will be foreclosed on.
____________________________________
"Whoever corrects a mocker invites insult; whoever rebukes a wicked man incurs abuse."
I worked at the downtown SIBC
I was a loan officer at the Clinch Avenue branch of SIBC around 1979-80, which would have made me maybe 21 or 22 years old.
I recall writing many small loans that were "secured" by household goods. I typed long lists itemizing the lamps, rugs, and bedspreads (!) that were to serve as collateral, then obtained the borrowers' signatures on a separate affadavit I was instructed to attach to the lists. Since the credit was easy, the rates were high--24% and sometimes higher.
I also wrote loans for the customers of several door-to-door sales companies (of the Stanley and Fuller Brush sort), whose merchandise was outrageously overpriced. One of those companies was Towncraft Cookware, whose cookware sets sold for $1000 and $1500, even that long ago. Somehow, Towncraft's slick salesmen reeled in customers for wares this pricey AND persuaded those customers to finance their purchases at rates like the aforementioned!
David Payne and David Crabtree, two principals in the company, dropped by the Clinch Avenue branch fairly often. I moved to California in 1982, but I read in the newspaper out there that both went to prison following the collapse. By that time, I was very happily employed with a top-rated, federally insured credit union. Whew...
Oh No!
You were a tool of The Man. Did you ever feel guilty? Did they ever reposess those bedspreads?
It would be nice to see that type of predatory lending be outlawed.
____________________________________
"Whoever corrects a mocker invites insult; whoever rebukes a wicked man incurs abuse."