Boise Banker, Businessman, and School Advocate Horace E. Neal [otd 09/07]

Boise businessman Horace Edwin Neal was born September 7, 1859 in Van Buren County, Iowa, about 100 miles southeast of Des Moines. He was still a small child when the family moved to a farm near the Missouri River in southeast Nebraska. Horace pieced together several years of college classes, taught school for three years, and then worked for several years in Kansas and eastern Colorado.

H. E. Neal. [Illust-State]

Horace and a younger brother, W. Scott Neal, moved to Boise in 1890 and started a business dealing in insurance and real estate. Scott continued with that business for many years, but in 1891 Horace became one of the founders of the Capital State Bank of Idaho. He served first as Assistant Cashier and then, in 1894, as Cashier, a job he held for over a decade.

Horace also had interests outside the bank. At the same time that company was founded, he helped open a chapter of the Young Men’s Christian Association, serving as the organization’s secretary. Unfortunately, that attempt only lasted three or four years before it dissolved. (A new, successful YMCA was formed in 1900, but Neal was then too busy with other activities to take part.)

After being first appointed as Boise City Treasurer in 1893, Neal was then elected to the position. He held the job through 1899. He was also Treasurer of the Independent School District of Boise City for awhile, and would remain a member of the Board of Trustees for many, many years. He and his wife (he married a Boise woman in 1893) were active members of the Methodist Church. Horace taught Sunday school and was at one time President of the state Sunday School Association.

Neal also branched out into other businesses, including investments in oil exploration, mining, a lumber company in Oregon, and a long-distance telephone service. In 1902, he and a group of investors formed the Fairview Investment Company, which successfully developed what is now known as the Fairview District of Boise.

In 1906, delegates at a National Irrigation Congress were given a tour of the Capital State Bank. They were greatly impressed, and knowledgeable observers proclaimed it to be one of the “great banking institutions of the West.” But trouble was brewing.

The details of the “Panic of 1907” are beyond the scope of this article. But the general loss of confidence in the U. S. financial system hit the Capital State Bank hard, and it failed to open for business on January 21, 1908. An independent auditor stated that the bank’s assets fully covered every depositor. But it would take time to convert those assets to cash, if need be; people must be patient. Sadly, that wasn’t good enough and the bank never opened its doors again.

Bank Run in New York, 1907. Library of Congress.

A scapegoat needed to be found. Officials soon arrested Neal, charging him with multiple counts of forgery. Eighteen months of expensive legal sparring followed before prosecutors admitted they had no case and dropped all charges against Horace. By the fall of 1909, he was back in the insurance and real estate business.

Neal also maintained his interest in the education of young people. He continued to serve on the school boards for the county as well as the Methodist Church. He was also Director of the Ada County Boys’ and Girls’ Clubs for a time. Although his company handled real estate loans, he never went back into the banking business.

Horace E. Neal passed away in February of 1932.
                                                                                                                                     

References:[Illustrated State]

Robert F. Bruner, Sean D. Carr, The Panic of 1907: Lessons Learned from the Market's Perfect Storm, John Wiley & Sons, Inc., New York (2007).

“[H. E. Neal News],” Idaho Statesman, Boise (April 1891 – February 1932).

W. C. Jenkins, “The Capital State Bank of Idaho,” The Irrigation Age, Vol. XXI, No. 11, Chicago, Illinois (September 1906).

The Copper Handbook: A Manual of the Copper Industry of the World, Vol. IX, Horace J. Stevens, Houghton, Michigan (1909).