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Os January 9, 1933, tho fallowing colloquy botvo#& Senator
aad Senator Whoalor ooeurrod OR tho ftraato- Floor t
Mr. KHSliLSB. On tho quostioa of doubl* l i a b i l i t y , I aa
inform**!, for ia«tamM« that th# ©ha in ba»k« In my Stat« # i f
fcho p«ndlag moasura should b«oo»s A law, would fcsssatiiatoly
roorganita thair ohain bask* into a braaoh banking syrtami that
fchoy would •stabllsh « principal bank im oae of th« atmters, and
atafco nil tho oth«r b»ak« 4«st »«r« br*neh©» of that baakf aad th*t
they would g«t avay frtaa the doubl# liabilils^ ^ i « h t?h«y now h»T»
in t3i« o*«# of th« wirious o^ior bank* mad osly feftve double l i a b i l i t y la tit* @fc*« of fcha oa« •la$X« bank* nfelsk woaleJ b# th« isaim


fhoy havo no double l i a b i l i t y If i t i s a

Mr* WHIL%a» I bag fch* £i«nat«r*« pardoui they
l i a b i l i t y , boofcu«« fehay hava dlraotor« of tb» ^arirais banks at
$* t tiotioa th« »->eaator ah&kaa his h#ad la th«
but I happen to know that th«y do har« double liability»
1 hapfwa to know - afe l«ast, I think I taaow i t
tfaat i f i t i s a ohain backing «y8t«aa, no doabl# l i a b i l i t y i«
Mr* WiiSELSS* If
double l i a b i l i t y ,
Mr. OUSS. If th« stookholdar of oa© aafeiowai basOc i t
a fto«ichold«r of aaouhor ««oh bank, of aour««, ho ha» a doublo
l i a b i l i t y la aaoh iuatitutioai but that la aots tfeo ch*in bajOeiag
8/ftem nor if i t tho group baakiag syfttom. ?or that r«a*oa# in th»
ooading b i l l we havo provide tbat If th* oh*in and group banking
tyttoat «hall paraist tkoy aiuat lacur a double l i a b i l i t y or go out
of «xl«to»ao» $o tho«a v^o aro oxedriOAood in banking w i l l difforontlato feha branch biisldii^ oyatea aad th* chain aad group bamldtsg
«y tt«M ia muay ro«poott| and, i f ^ioy are dlaoornitig or i t l o t , thoy
will t o l l f&^titULtboth tho group aad cb*ln banking 8y«t«ms# if not
poaltivoly rioioua, unlo*s oxferoaoiy and oautlouily Jaanagod, aro a
to thu srodlt $y»t«& of any State In whioh ^ « y nay bo ostab*
I aa ^lad to say thoro aro e^oep^ion* to the rulaj 1 aa glad to
to«tlfy # from tho thorough I i v r e s t a t i o n of tho Bamkiau and Gurroaoy
Goaaittao, itokt the group baakit% aye tea of tho Stato of Michigan has
boom a* thoroughly and as »ffaotiiroly woll«4Baim$oa aa 1< posslblo to
a ohain baialtia^ system aM ha is Wen of gr«at sorrioo t o tho
aad th© orodlt roqulrooonts of that Stato*
Mr* t*I03H»BKS»

^nd has Tol«ftfearily aoknowlodgod t^io doablo

Mr* OUSS* And 1B th»ir very eharter, upon their twra i n i t i a t i v e ,
voluntarily a@kiwri«%«<i th# double l i a b i l i t y , wfeielt i s «©a»thi»g
that do«» not prafail in ft groat majority of «»eh systems. Th«y *r«
capitallt«d apon a f a i r and honaat basis* fh«y ha-r© not gone out, as
th« iaaaag«rs of sou* sueh syetarns haw den*, and «tripp«d th«ir riotlms
by T«Itaring thair stoek in a «ha««f«l way* So much, Ur* ?r«sidaat» t*r
what we haft to*«tt taught t© balieve *r« the d i s t i n e t i o » s b«tw»*n branoh
banking mm& group basking*