GOOD OLD DAYS:

Newport Beach native Allan Beek remembers his father, Joseph Beek, sitting in the living room looking rather defeated the day the Bank of Balboa failed in 1932.

“I caught on there was something going on about money,” said Beek, who was only 4 or 5 years old at the time. “So I got the contents of my piggy bank — it must have been about a dollar and a half, brought it to him and said ‘I got some money, Joey.’ It sort of made me his darling forevermore.”

Joseph Beek, who also founded the Balboa Island Ferry in 1919, was a director of the Bank of Balboa, which shut its doors in 1932, during the depths of the Great Depression.

The Bank of Balboa may have been the first bank in Newport Beach to fail in a bad economic cycle, but it wasn’t the last. U.S. Bank Corp. took over Newport Beach-based Downey Savings and Loan Assn. last month after the thrift lost hundreds of millions of dollars from bad loans, mostly from risky adjustable-rate mortgages .

The details of the run on Bank of Balboa in January 1932 have mostly been lost to history, but something made depositors at the bank nervous enough to withdraw their money that day, Allan Beek said.

“Word gets around — there’s a run on the bank,” he said. “It’s one of those crazy things I guess. You might compare it with lemmings.”

There ended up being more than enough money to cover all of the deposits at the Bank of Balboa that day, but it was the cost of the inspection by bank examiners after the bank run that broke the place.

“There was a shortage when the bank examiners charged a fee for their examination and the directors had to personally make up the difference,” Allan Beek said.

State law at the time decreed the bank’s officers and directors be assessed 100% of the cost of the bank’s stock because of the failure, according to the book “Tales of Balboa,” by Jim Fournier.

Founded by George Edward, the Bank of Balboa opened its doors in 1922, according to historical accounts from the Los Angeles Times.

“The Bank of Balboa, newly organized as a state bank and established in a handsome block newly refinished will be opened at Balboa Beach next Saturday and an effort is being made toward a record number of first-day deposits,” a Los Angeles Times story dated Sept. 29, 1922 stated.

Hundreds flocked to the bank on its opening day to celebrate the beginning of Balboa’s first financial institution according to a Los Angeles Times article dated Oct. 2, 1922.

The bank’s first location was at the northeast corner of Washington Street and Central Avenue, now Balboa Boulevard.

Capt. E. J. Louis and Henrietta Tudor, 11, were among the bank’s first depositors, according to historical newspaper accounts. Depositors received souvenir silver pencils on opening day.

The Bank of Balboa was touted as “your beacon of success,” in an old newspaper advertisement from the era, promoting the bank’s main office in Balboa and a branch in Costa Mesa.

“Shining thru [sic] the ‘Encircling Gloom’ the kindly light of an account in the Bank of Balboa will guide you to safety,” the ad read.

A new bank building was built on the southeast corner of Washington Street and Central Avenue in 1927, at a cost of $50,000.

Bank of America purchased the Bank of Balboa building in 1934 for $27,000 after it failed.

Pavilion Realtors, at 700 E. Balboa Blvd., now sits on the site of the old bank, which was eventually bulldozed.

“It was a wonderful building,” Allan Beek said. “There was a sort of that hushed silence and things echoed, so you felt you had to whisper.

BRIANNA BAILEY may be reached at (714) 966-4625 or at brianna.bailey@latimes.com.