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THE AMERICAN BANKERS ASSOCIATION OFFICE OF THE PRESIDENT WACHOVIA BANK AND TRUST COMPANY WINSTON-SALEM, N.C. June 29, 194-0. ROBERT M.HANES PRESIDENT Hon. Marriner S. Eccles, Chairman, Board of Governors of the Federal Reserve System, Washington, D. C. Dear Marriner: I am enclosing herewith copy of a letter which has been sent to about 15,000 banks in the country. I shall deeply appreciate any criticism or suggestion you might have regarding it after you have had an opportunity to read it. We are trying in every way to stimulate bankers to make every effort to fill the credit needs of their communities. It was nice to see you in your office on Monday and I shall have the pleasure of a visit with you again soon. Cord THE PRESIDENT ROBERT M. HANES, PRESIDENT W A C H O V I A ) BANK & TRUST C O . WINSTON-SALElk NORTH CAROLINA FIRST V I C E PRESIDENT P. D. HOUSTON C H A I R M A N OF THE BOARD AMERICAN NATIONAL BANK NASHVILLE, TENNESSEE AMERICAN BANKERS ASSOCIATION S E C O N D VICE PRESIDENT H . W. K O E N E K E . PRESIDENT THE SECURITY BANK OF PONCA CITY PONCA CITY. OKLAHOMA 22 East 4O Street, NewYork,N.Y S E N I O R DEPUTY M A N A G E R FRANK W. SIMMONDS, SECRETARY STATE B A N K D I V I S I O N DEPUTY M A N A G E R S W. ESPEY A L B I S . SECRETARY SAVI NGS D I V I S I O N JAMES E. BAUM, MANAGER PROTECTIVE DEPARTMENT A. 6 . B R O W N , M A N A G E R AGRICULTURAL CREDIT DEPARTMENT WALTER B. FRENCH, MANAGER CONSUMER CREDIT DEPARTMENT EDGAR E. MOUNTJOY, SECRETARY NATIONAL BANK DIVISION T R E A S U RER B. M U R R A Y P E Y T O N , P R E S I D E N T M I N N E S O T A N A T I O N A L BANK DULUTH, MINNESOTA BRANCH WASHINGTON MERLE E. SELECMAN, SECRETARY TRUST D I V I S I O N OFFICE BUILDING, WASHINGTON, D. C . EXECUTIVE M A N A G E R HAROLD STONIER ECONOMIST D R . P A U L F. GENERAL DR. ERNEST M. FISHER. DIRECTOR RESEARCH IN MORTGAGE AND REAL ESTATE FINANCE COUNSEL D. J. NEEDHAM SECRETARY R I C H A R D W. June 27, 194-0 HILL CADMAN W I L L I A M POWERS, DIRECTOR CUSTOMER RELATIONS To the Members American Bankers Association Dear Fellow Member: The government is launching a huge program for the defense of the United States. I am sure you have been thinking about how this program is to be financed and how the banker can help. The required financing will take two forms: direct expenditures by the government financed by the sale of federal securities, and the financing of business concerns which have government contracts. My own belief and that of others with whom I have discussed this question is that both sorts of financing can and should be carried out through the normal existing channels, without the creation of new agencies, mechanism or devices. The banks of this country have the resources, the trained personnel and the knowledge of their own communities, which equip them, along with the investment markets, to handle a very large part of the necessary financing. This financing can be carried out in such ways as will enable the banks to provide an adequate volume of loans and at the same time safeguard the funds of their depositors. All banks should be actively and energetically soliciting every sound loan in their communities. Especially is it true that they should try in every possible way to make every loan that has anything to do with the defense program. In presenting these views to Congress, the Administration, and the public, your officers will be reassured if they can feel that they have the concurrence and support of the membership of the Association. Therefore, if you agree I shall appreciate it if you will telegraph me to that effect immediately. c Robert M. Banes President FROM: .AMERICAN BANKERS ASSOCIATION RELEASED FRIDAY MORNING JUNE 28, 1940 THE NEWS BUREAU Lester Gibson, Director 22 East 40 Street, New York, N f Y. 6/26/40 A.B.A. HEAD SAYS DEFENSE CAN BE FINANCED THROUGH NOFMAL CHANNELS New York, June 27. - Financing of the national defense program "can and should be carried on through the normal existing channels without the creation of new agencies, mechanism or devices," banks of the country were told in a letter sent to members of the American Bankers Association throughout the country tonight by Robert M. Hanes, president of the Association,in which he urged support of the defense program. Mr. Hanes urged the banks to "try in every possible way to make every loan that has anything to do with the defense program." His letter follows: M The government is launching a huge program for the defense of the United States. I am sure you have been thinking about how this program is to be financed and how the banker can help. The required financing will take two forms: direct expenditures by the government financed by the sale of Federal securities, and the financing of business concerns which have government contracts. "My own belief and that of others with wham I have discussed this question is that both sorts of financing can and should be carried out through the normal existing channels, without the creation of new agencies, mechanism or devices. The banks of this country have the resources, the trained personnel and the knowledge of their own communities, which equip them, along with the investment markets, to handle a very large part of the necessary financing. This financing can be carried out in such ways as will enable the banks to provide an adequate volume of loans and at the same time safeguard the funds of their depositors. "All banks should be actively and energetically soliciting every sound loan in their communities. Especially is it true that they should try in every possible way to make every loan that has anything to do with the defense program. "In presenting these views to Congress, the Administration, and the public, your officers will be reassured if they can feel that they have the concurrence and support of the membership of the Association. Therefore, if you agree I shall appreciate it if you will telegraph me to that effect immediately.'» July 3, 1940. Mr. R. M. Hanes, President, The American Bankers Association, f.'achovia Bank and Trust Company, Kinston-Salesi, Horth Carolina. Dear Bob: I have yours of June £9 with which you enclosed a copy of a circular letter of June 27 to all members of the American Bankers Association, urging them to cooperate in financing the Government*s defense program. Since you ask me for my comments respecting the circular, 1 am glad to advise that I think it is a very effective appeal. I believe you already know that 1 have been consistently in favor of tapping the credit reservoirs already available in the banking systea for the Government's requirements rather than to have new aechanisas set up, therefore, I can cofasend heartily your statement that this new financing "can ana should be carried out through the normal existing channels*. The only suggestion that 1 might have aade irith respect to your letter would have been the addition of the following to the end of the first paragraph* •or ifchich supply products to such concerns.1* I understand that there are many companies, even of substantial size, engaged in the manufacture of war equipment* including airplane engines, which depend upon sub-contractors for a large proportion of the component parts of the finished product which they have contracted to furnish the Government. With kind personal regards, 1 am Very sincerely, Marriner 8. Eccles, Chairman. L FY THE AMERICAN BANKERS ASSOCIATION OFFICE OF THE PRESIDENT WACHOVIA BANK AND TRUST COMPANY WINSTON-SALEM, ROBERT M.HANES July 5, N.C. 194-0. PRESIDENT Hon. Marriner S. Eccles, Chairman, Board of Governors of the Federal Reserve System, Washington, D. C. Dear Marrineri Many thanks for the suggestion which you have Bade in your letter of July 3, which I think is both timely and helpful. I shall see that this is incorporated into any future letters we get out, and I am quite sure we shall have others. With every good wish, I am Cordially irours.
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