JAMES CHRISTOPHER PAUL 

FRONTIER BANKER   

9/19/1852    3/3/1935

When, on January 1, 1888, the first train arrived at Panhandle City, James Christopher Paul was on it.  He was to become one of the major influences on the development of Panhandle City and one of the most revered bankers of the Panhandle of Texas.  In his story, one can see many of the patterns of the frontier leaders in the latter part of the nineteenth century.  As a banker in a pioneer community, he was responsible for the monetary affairs of the community, was expected to be one of the cornerstones of society in civic affairs and was a general entrepreneur in the community.

Born in Fairfield, Virginia, on September 19, 1852, J.C. Paul was brought up in a Quaker farming family.  When the Pauls joined a farming co-operative, they also broke away from the Quaker church, for the church did not believe in membership in co-operatives.  While this break demonstrated the Pauls' pragmatism, it had a considerable influence on J.C. Paul, for while he was a deeply religious man, he never again affiliated with any church.  He did attend church, regularly, for the rest of his life, supporting various ones in each of the places he lived.  Paul, believing that religion and spiritual truths are part of the personal realm of life, reared his children to have high moral values, but left decisions about their personal beliefs up to them.[i]

J.C. Paul taught school near Waynesboro, Virginia and then attended Normal University in Bloomington, Illinois, "to better educate himself and to obtain a certificate for teaching."[ii]  After graduating, he taught in Iowa and at Nunda, Illinois, where he became the principal of the school.  There, in 1886, he married Nina R Darby, an ex-student of his.

Compelled by a desire to do well in business, Paul left Nunda and entered the real estate and insurance business.  His initial capital came from income from a cotton farm near Houston, Texas, which had been left to him by an uncle.  He said, "I was a real estate man in Wichita, Kansas, in 1887, and went broke like all the others in that wonderful boom."[iii]

Discouraged with the prospects in the Midwest and the real estate business, he encouraged three of his associates to put up enough money to start a bank in the Panhandle of Texas.[iv]   You can read a paper he wrote on frontier life in the Panhandle.

          West Texas, formerly designated on the map as the "Great American Desert", furnished the last chance to plant a colony just a little different from any of the former settlements.[v]

Paul saw the settling of this new section as the last of the continual pattern of development "from Jamestown in Virginia and Plymouth Colony in Massachusetts, down through the two or three centuries..."[vi] The little difference which Paul saw between this settlement and the past settlements was that the pioneers who went into the Panhandle were native Americans--the Panhandle was a

          "melting pot" for the energetic, ambitious and progressive elements from all of the older settlements where more room and greater opportunities were desired.[vii]

His plan was to get a corner on the banking business in the Panhandle as the only other purely banking establishment was in Canadian, a town seventy-five miles away.  Because of the shortage of money on the range, "many of the merchants conducted a banking business in connection with their mercantile establishments."[viii]  Paul wrote, 

     Railroads are soon to be constructed all over our corner of the state--thus making one or more good towns in here somewhere.  We think this'll be the town, but if it happens not to be, we can very soon move there.[ix]

The railroad, which brought J.C. Paul to Panhandle City brought a chance for economic development to the whole Panhandle.  In 1884, an Act of Congress granted the Southern Kansas Railway Company

     the right to locate, construct, own, equip and operate a railway, telegraph and telephone line through the Indian Territory....to a point near the junction of the Washita and Red Rivers."[x]

This was the first railroad that had ever entered North Texas.  In 1886 there were 100,000 miles of railroad already completed or in the process of being completed in Southern and Western Texas owned by the Atchison, Topeka and Santa Fe Railroad.[xi]  The Fort Worth and Denver City had made a deal with the Santa Fe that "if the Santa Fe would extend no farther southwest" (they were planning to build their original main line near Albuquerque, New Mexico) "than Panhandle City...the northbound Denver Road would build to that point so as to afford...a through connection to the heart of Northwest Texas."[xii]  Another railroad company, the Saint Louis and San Francisco, also agreed to make Panhandle City its western terminus, but it met financial reverses and collapsed.[xiii]

Paul had good reason to believe Panhandle City would be the center of commerce in the Panhandle.  Nowhere else were the prospects for transportation so auspicious.  Even when the Fort Worth and Denver railroad missed Panhandle City, prospects looked good, for a separate railroad, the Pan-Handle Railway Company, linked it with Panhandle City.  This railroad passed through a settlement called Rag Town, later Amarillo--the present commercial center of the Panhandle, and between the years 1890 and 1900, one of its main uses was as a connection between Amarillo and Panhandle City. 

Railroads were extremely important to the Panhandle because they provided a means to move cattle to markets in the North and East.  The cattle trails had already passed through the Texas Panhandle because

     the Indian barrier, the quarantine regulations, and the westward moving farming frontier in Kansas had a tendency to bend the trails of Texas further and further westward.[xiv]

Railroads also provided a means for the middle class merchant and the farmer from the Midwest to come into the Panhandle.  No longer was it difficult for settlers to enter this section of "The Great American Desert".

The Panhandle Bank of Panhandle City, Texas, was organized on the eighth day of April 1888, and commenced business on May 8, 1888, with J.C. Paul as "president, vice president, cashier, bookkeeper, and janitor of the bank."[xv]  Business was carried on in a two-story frame building covered with tin.  Costing about sixteen hundred dollars, it was the only two-story building in Panhandle City.  Paul had been advised not to build it because most people believed that it would not stand the winds characteristic of the plains.  Mr. and Mrs. Paul and the son, Frank, who had been born in Wichita lived on the second floor.  During hard times, the Pauls also took in a roomer or two. 

The principal fixtures of the bank were an iron safe, books, ledgers and a pistol.  Everything else that was needed was hand made.[xvi]  When the safe arrived in Panhandle City, there was not a wagon large enough to haul it, so it had to be snaked to the bank building on a road of heavy timber constructed for this purpose.[xvii]

At this time Panhandle City consisted of about fifteen frame stores--there were no stone or brick buildings--most of which were either saloons, gambling houses, or dance halls patronized by the cowboys.

        The big cattle shipments made from Panhandle from 1888 to 1895 brought hundreds of cow boys, ranch bosses and camp followers there, and many thousands of dollars were lost and won in a single night.  The professional gamblers, of course, were always the winners.[xviii]

 The actual area of the town was not very large and one could see herds of wild horses, antelopes and coyotes from the front porch of the bank.  J.C. Paul often told of the time when George Berry, the owner and bartender of a saloon that was situated next to the bank came into the bank under the influence of alcohol.  He talked to Paul for a while and Paul tried to appear to be busy at his books so Berry would leave.  The monologue continued until Berry finally informed the banker that all he was doing was giving Paul a sample of what happened to him all the time he was behind the bar.

As the town became more settled, the saloons and gambling houses gradually died out for the new population was more interested in being a commercial center than being an entertainment center.  The main entertainment became the old fashioned square dance, which lasted all night so the ranchers' and farmers' daughters could go home by daylight.

Being new to the banking business, Paul had much to learn.  He received help from the Fort Worth National Bank when he was in doubt about amounts to charge for different services.  He strived to be professional and orthodox in the operations of the bank.  After he had become successful, he reminisced, "By the time the building was complete, all of us (the partners) had cold feet.[xix]  The main income of the bank was from loans made for periods of thirty to ninety days with an interest of one and one-half to two percent per month.[xx]  The high interest rates were necessary because loans were made on personal security often without mortgages or collateral.  Paul said that his excuse for charging such interest was that "some one must pay us to live in such a country."[xxi]

The frontier banker was required to know those with whom he was dealing and to be able to make a valid character judgment.  According to Paul,

                 A man's word was his bond.  Of course, the people here then were rough--most of them being gamblers, freighters[xxii] and saloon keepers--but they were inherently honest and there were no robberies.[xxiii]

Being too dependent on its deposits, which fluctuated rapidly, hampered the Panhandle Bank.  In September of 1888, Paul loaned too closely and was almost ruined when some of the loans failed to be paid.  He wrote to one of his partners that "Greed" was at the bottom of his actions.[xxiv]  Additional revenue came into the bank when it secured or collected loans for loan companies.  Often, it would get as high as a two and one-half percent profit. 

There was not much demand for cash in the early days of banking in the Panhandle as most of the business of the bank and its clients was carried on by checks and bank drafts.  The Panhandle Bank would keep deposits at a main bank in a few large cities and draw drafts on these deposits.  When cash was needed, it was ordered from a bank in Wichita or Kansas City and brought by Wells Fargo.  The distances involved in transactions of all kinds were a hindrance to the banking business.

Since Paul was the only employee of the bank during its first few years of existence, the bank would often be closed so he could check on loans at various places in the Panhandle.  His frugality paid and the bank made a small profit from the first and in thirty-nine years, it declared thirty-eight dividends.

Banking was done on a personal basis.  E.E. Carhart, the cashier of the Panhandle Bank from 1906 to 1927 said,

a business was built up by making friendly contacts with ranchers.  We handled more of the accounts of the smaller cattlemen as the large ranchers usually carried accounts with the large city banks where the cattle were sold.[xxv]

J.M. Sanford told of his first account at the Panhandle Bank: 

        Back in 1893 I made a deposit and waited for a check book.  Mr. Paul refused and said I did not need one--that I ought to keep my money in the bank instead of spending it.[xxvi]

Mr. Sanford admitted that Paul was right.

As Paul was paid only forty dollars a month plus room, he found that he had to engage in other business endeavors.  He had a new son, Howard, who was born in 1889 on the second floor of the bank building (this led Paul to call him a natural born banker) and he had a desire to live comfortably and travel.  He once told a future employee, 

        If you can't make as much money on the outside each month as we pay you inside, you are not the man I want.[xxvii]

This statement displayed his feelings that one should be involved in businesses other than one's main livelihood.  Buying and selling lots for men in other states and finding land for ranchers to lease, Paul did a small real estate business.  In addition, he sold insurance on the side. 

Being the president of the bank made him the natural person to be County Treasurer.  This position not only put money in his bank; it also gave him the job of selling the county bonds.  He originally hoped to get a percentage from these transactions, but later found out that it was impossible.  In all, he did make about four hundred dollars from this position.[xxviii]  He also sold bonds for Sherman County, Texas, under the authorization of Judge J.W. O'Brien.

Because of a Texas law requiring almost all of the officers of railroads within the state to live in Texas, the Santa Fe had to have officers in Texas.  Paul became the secretary of the plains branch, at first with no remuneration other than passes.  His bank was helped considerably, however, by the deposits of the railroad's money (at one time it was three-fifths of the total deposits). 

Paul also entered into agriculture for he felt that the land around Panhandle City would "become the best wheat land in America."[xxix]  There were many crop failures, but it is now evident that he was correct.

During the nineties, he raised some horses and mules which he sold to people all over the Panhandle.  He also managed the Francklyn Land and Cattle Company for a short period.  This was a six hundred thousand acre spread that was owned by a group of English businessmen.

In addition to his role as a leading capitalist, Paul was important to Carson County for the encouragement he gave to new businesses and his encouragement of new ideas in agriculture.  He took pride in never foreclosing on a farm mortgage and he was constantly giving extensions on loans.  The Panhandle Herald was in debt to him until 1936. 

Because of his excellent reputation and his seemingly unending energy, he was a center of the county's activities.  Other than filling the position of County Treasurer for six years, J.C. Paul was the County Judge. 

The citizens of Carson County realized that it was necessary for them to join together to improve their county and to attract new settlers.  One of the county's largest problems was the scarcity of water on the plains.  Brought in barrels at first on wagons and then on the railroad, water cost fifty cents a barrel.  In 1888, Judge Paul was put in charge of having a well drilled.  In his letters to drilling contractors, he stated the immediate need for a well.  The citizens of Panhandle City had tried to put one down, but failed. 

Judge Paul pushed ahead on the well digging project when others wanted to give up.  He wrote, 

        In the past two weeks over twenty families have taken sections and become permanent residents of an adjoining county...unless we get water at once, we'll lose all the fall immigrants and many of the business men already here.[xxx]

Judge Paul tried to persuade the railroad to dig the well, but they promised nothing for two or three months and he felt that if nothing were done by that time, the town would be deserted.  By attracting new settlers to the town, an Artesian well would increase the value of the land in Panhandle City one hundred percent and make the lots there immediately salable.  Without it, there was no one who was willing to make their second payment on the lots they bought the preceding winter. 

Even though there was no well for some time, business improved with the summer rains and fall cattle shipments.  To encourage new settlers to come to Panhandle City, the immigration committee published brochures on the county and Judge Paul was once again in charge of correspondence.  The duty of corresponding to get a new editor for the paper was also given to him when the town became dissatisfied with its editor.

The county saw a need for different people essential in a community and attempted to recruit them.  For several years the county paid the local doctor because the population could not support him.  When no one could be recruited for a given job, one of the citizens would assume it.  As has already been shown, Judge Paul filled many positions.  At one time, he was even a dentist's assistant when the barber who substituted as a dentist needed someone to help hold down a hefty woman patient. 

This filling of positions by unqualified people brought a certain lack of formality.  When Judge Paul had to turn in one of his sworn monthly statements to the Southern Kansas Railway Company of Texas, Pete Leithauser, Justice of the Peace, swore him in as follows:  "Do you fellows both solemnly swear that what you wrote in that paper is the truth, so help you by God?"[xxxi]

Business was not good for ten years after he entered the banking profession, but J.C. Paul remained in Panhandle City.  He continued looking for better opportunities elsewhere, but could not find them.  When the nearby Amarillo citizens asked him to move his business there, he replied:

I am rather displeased with the outlook here for the immediate future.  Should like to better myself if possible.

          I can see for your town a good share of the Southwestern business this season; but my business should be made as permanent as possible; and I could not afford to even open a branch there without a good prospect of future trade...What arrangements could be made there to get a small room for my business?[xxxii]

Later, in March, he wrote that his partners were wanting to abandon the Panhandle, but that he was interested in moving to Amarillo.  Other towns in the Panhandle also tried to get him to move his bank, but Amarillo seemed to be the only location in which he was really interested.  His plans for moving did not necessarily mean the closing of the Panhandle Bank.  He considered having a cashier run it while he opened a new bank.

Other business opportunities also interested Judge Paul.  Inquiring into positions with furniture companies, insurance concerns and ranches, he was always ready to seize a better opportunity.  He received a law degree and thought about opening a law firm with his good friend Temple Houston, but could not depend on Houston's sobriety.

During the extremely hard years from 1890 to 1893, a few men owed the Panhandle Bank an aggregate amount several times its capital stock.[xxxiii]  Many of the men who had filed on sections of land left the Panhandle for the Indian Territory, leaving their land to Judge Paul.  He kept this land for eight or ten years and then finally let it go.

Himself attracted by the land rush, he locked up the bank and went to Oklahoma.  He later told of his experience as follows: 

          At Woodward I got a lot, went to sleep on one end of it, and when I woke up the next morning there was a man on the other end of it.  I didn't want it very badly and told him he could have it.[xxxiv]

Judge Paul had personal hardships as well as financial ones, for his wife died in 1892.  He persuaded Mr. and Mrs. John Lill to move to his farm and ranch and care for his two sons and he continued his entrepreneurial life.

In the spring 1892 he helped form the Amarillo National Bank with himself as president and A.H. Wood as cashier.  He remained president until 1896 when he sold his interest.  This was the second bank in Amarillo, the first being the First National Bank, formed in 1890 with the amazingly large capital stock of fifty thousand dollars. 

It had become fairly obvious that Amarillo, with a population of one thousand, was going to be the commercial center of the Panhandle rather than Panhandle City, which had a population of only a few hundred.  However, Judge Paul retained his faith in Panhandle City.  In 1893, he bought out his partners and increased the capital stock of the Panhandle Bank to ten thousand dollars.  His partners had been trying to get him to buy them out since 1889, but he had never considered the bank worth the capital they had in it before this time.  His action is amazing when one considers that these were the years of depression and bank runs.  Part of his optimism came from the increasing cattle shipments from Panhandle City.  For a few years, Panhandle City was the heaviest cattle shipping point on the plains with fifty to sixty thousand head waiting shipping at times.[xxxv]

The severe winter and drought killed the crops in 1894-5 and increased the hardships on the bank.  Total bank deposits were only fourteen thousand dollars.  During the hard times, Judge Paul would often use the money he received from his cotton crop in South Texas to assuage the fears of his depositors.  Cooperating to keep from having a run, the Panhandle and Amarillo banks were always ready to ship money to the other.  The once optimistic banker felt that the country was doomed for farming; it seemed good for only livestock.[xxxvi]

Around the turn of the century, business improved considerably and farming became very profitable.  As can be expected, the increasing prosperity of the country caused the banks to become more prosperous.

In 1906, J.C. Paul reentered the Amarillo banking business when he became the president of the Amarillo Bank and Trust Company.[1]  This same year, he increased the capital stock of the Panhandle Bank to fifteen thousand dollars by taking in stockholders.

In 1911, J.C. Paul opened the Paul Bank in Slaton, Texas, putting his son, Howard Paul, in the same positions he had held when he started the Panhandle Bank.[2]  His other son Frank worked in the Panhandle bank.  In 1916, J.C. and Howard Paul helped found the Guarantee State Bank of Amarillo.  In 1917, they sold the Slaton bank and in 1920, Howard Paul bought out one of the partners in the Guarantee State Bank and became president with J.C. Paul chairman of the board.

Having his sons around to run the banks, J.C. Paul began to travel a great deal.  He kept a close contact with his family in Virginia, visiting them and taking his relatives traveling with him.  Around 1920, he bought his old Virginia home place, a farm and dairy, to help out family members. 

Continuing to travel through the rest of his life, he spent his winters in California or Florida with friends and later Howard's daughter, Mary Paul, who had lost her mother when she was two.  His pioneering spirit remained alive and Judge Paul made a special trip to California so he could be one of the first two passengers on Trans World Airline's first flight to Amarillo in 1924. 

The twenties and the oil boom brought good times to the Panhandle and the Panhandle's banks.  In 1921, the first oil well in Carson County came through, bringing in one hundred and seventy-five barrels daily.  The cashier of the Panhandle Bank remembered, 

        Someone passing through Panhandle saw a line of people outside of the bank and reported it to banks at Amarillo.  We had a phone call asking if we needed any money to handle a "run" on the bank, but we told them at Amarillo that it was just our regular business.[xxxvii]

In 1926, Judge Paul established the First National Bank of Panhandle.  This bank merged with the Panhandle Bank in 1942, ending the oldest bank in Texas north and West of Wichita Falls. Up until the time of this merger, a Paul had run the bank.

Only one of the Amarillo banks, the National Bank of Commerce, closed during the depression and Will O'Brien, the owner of the bank, personally borrowed money from the other banks to pay the bank's depositors so that none of them would lose money.  This action helped prevent runs on all Amarillo banks.  All the banks experienced hard times and there were mergers, but the Pauls made it through the depression fairly well.

In his later years, Judge Paul traveled and visited his family.  Here he is seen with Mary Paul, an unknown woman and Auntie Brown in California.

On March 3rd, 1935, Judge James Christopher Paul died from a paralytic stroke he had suffered a week earlier.  Up until his death, he had been active in community affairs.  His death was felt by the whole town of Panhandle[3] and many of the citizens of the surrounding cities.  The man who died had been the "Dean of Panhandle Bankers", had started many of the major banks of the Panhandle and had been one of the founders and the first president of The Panhandle Bankers Association. 

But he had done more than that; he had started a tradition in Panhandle banking in which the bank is a personalized institution working with the individual for his and the community's good.  This tradition remained evident in his sons.  Paul was known not as a man who amassed a fortune, but as a man who conducted his business in a way, which helped others.  Judge J.C. Paul was an example of the modern pioneer who worked with vision inside a community in order to insure a present and a future for himself, his descendants and his community.

The Panhandle Bank is visible today in the Panhandle Plains Historical Museum in Canyon, Texas.