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_‘: Balance of Trade, etc., America and England. Bank Acceptances. Banking in Italy. Banking System of Japan. Banking System of Mexico. Bank of France in its Relations to Credit. Bank of Italy. Canadian Banking System. Clearing House Methods and Practices. Credit of Nations. Development of German Banking System. Development of Independent Treasury System. Digest of State Banking Laws. Discount System in Europe. English Banking Organizations. English Banking System. Evolution of Credit and Banks in France. First Bank of the United States. Fiscal Systems of England, France, etc. Foreign Balance of the United States. French Banking System, French Savings, etc. German Bank Inquiry, 1908. German Imperial Banking Laws. Great German Banks. Hearings of December 2 and 31 1908. History and Methods of the Paris Bourse. ‘. History of Banking In Canada. History of Banking in England. History of Crises under National Banking System. History of National Bank Currency. History of State Banks before Civil War. Interviews on Banking and Currency Systems. List of Publications. London Bankers' Clearing House. Miscellaneous Articles on German Banking. 'Abney Banking and Loan Laws of United States. National Bank of Belgium. Origin of the National Banking System. Portfolio of Diagrams. Renewal of Reichsbank Charter. Replies to Circular of September 26, 1908. Safety-fund Banking System, New York State. Seasonal Variations in Demands for Currency and Capital. Second Bank of the United States. Selected Documents on Bourse Legislation. Senator Aldrich's Economic Club Address. Special Report from Banks, United States, 1909. Statistics fDr Prance. Statistics for Germany. Statistics for Great Britain. Statistics for the United States. Swedish Banking System. The Reichsbank, 1876-1900. The Swiss Banking Law. Use of Credit Instruments in United States. Balance of Trade, etc., America and England. Bank Accpptances. Banking in Italy. Banking System of Japan. Banking System of Mexico. Bank of Prance in its Relations to Credit. Bank of Italy. Canadian Banking System. Clearing House Methods and Practices.. Credit of Nations. Development of German Banking Sysem. Development of Independent Treasury System. Digest of State Banking Laws. Discount System in Europe. English Banking Organizations._ English Banking System. Evolution of Credit and Banks in Prance. First Bank of the United States Piscal Systems of England, Prance, etc. Porcign Balance of the United States. Pronch Banking System, Trench Savings, etc. German Bank Inquiry, 1908. German Imperial Banking Laws. Great German Banks._ _ Hearings of December 2 and 3, 1908, History and MeLhods of the Pa -is Bourse. Hi,Itory of Banking In Canada. History of Banking in England. History of Cfises under National Banking System. History of National Bank Cucfenoy. History of State Banks before Civil War. Interviews on Banking and Cu,-rency Systems, List of Publications. London Bankers' Clca ing House. Miscellaneous Articles on Geman Banking. Money BanIcing and Loan Lasis of United States. National Bank of Belgium. Origin of the Nzeional Banking System. Portfolio of Diagrams. Renewal of Reichsbank Charter. Replies to Circular of September 26, 1908. Safety-fund Banking System, New York State, Seasonal Nariations in Demands for Currency and Capital. Second Bank of the Unied States. Selected Documents on Bourse Le[;islation. SenAor Aldrich's Economic Club Address. Special Report from Banks, United States, 1909. Statistics for France. Statistics for Germany. Statistics for Great Britain. Statistics for the United States. Svdish Banking System. The Reichebank, 1876-1900. The Swiss Banking Law. Use of Credit Instruments in United States. t. •- A . I, •As. 64-4.6-1J/4 414414,, UNITED STATES SENATE 1 Pusuo Dammam' Mt - U. S/S. a , if / .,:k v. -.) A C •X<: , A , 1 ; r.n - c. 'e\-0 -\ L-71 t?) ,Lupetit, Albert, c/o La Banque de Prance, Paris, France. ipeaulieu, M. Paul Leroy, Editor, "Economist Francais", Paris, Prance. ano4, Comm. Tito, Banca d'Italia, Rome, Italy. t onrad, Prof. Xohannes, University of Halle, Halle, Ge:bmany. .0'erraris, Carlo F., Camera del Deputati, Rome, Italy. laux, A. W Gwydyr House Whitehall, London, England. t rI.N.010, oxwell, H. S.,4"44'''AZ4 r-Miliamb:gidge l England. ram, Robert, c/o "Der Deutsche Oekonomist, Burgstrasse, 3, Berlin,/ Germany. en, Moreton, Brede Place, Sussex, Ery;land. orges-Levy, M. Raphael, 3 Rue de Uoisel XVI e l Paris, France. overnor , The, Bank of Belgium, Brussels, Belgium. ,4renf H 41 Edward C. Esq., if X. P. Morgan & Co., 22 Old -Boimire St., London, England. ginson & Co., 1 Bank Buildings, Price's Street, London, E.C. Englanik . tst, Francis W.,13 Arundel St., Strand, London, England. pAeTolland, Robert M.I Post Office Court, Lombard Street, London, En7land. orgoration der Kaufmannschaft von Brzlin (Bibliothek der) Berlin, C 2, Mrs°, St. Wolf -,:anstr. Vevandmann, Dr. Julius, Swiss National Bank, Berne, Swierland. pfevre, M., Credit Lyonnais, Boulevard des Italiens, Paris,France. 4449xis, Prof. W., University of Goettingen, Goettingen, Germany. 0,elt/fsif; . M. Andre, 18 Rue Denfert-Rochereau, Paris, France. 104( k, Alfred, 33 Rue St. Augustin, Paris, France. j°3arc ish, George, Editor, "The Statist", Cannon St., London, England. algrave,Sir. R.H., F.R.S., Henstead Hall, Wrentham,Suffolk, England. Plain, M. Georges, 0' La Banque de France, Paris, Prance. ffalovioh, A., Ministere des Finances/is Russie, Paris, Prance. Aye" Aiesser, Dr. 3., Lichtenstein-Allee,3, Berlin, German y. t 5 el.A.ma-, AM i, Sytrch, H. ' ,Iv'. .1 Bank- -of---343. 111-114 4° peVi0.1, E., 14.andsamr __En..7Artard'. 3 Place de la Bourse, Paris, France. e en B0,11m Bawerck, Prof. E., Uni7e -sity of Vienna, Vienna, Austria. O Dr. Karl, Director of the Reichsbank, Berlin, Grinany. ley, R. W., Esq., Gen'l Mangr. Parr's Bank, Ltd., London l Erwland. //1.0111,:rs, Hartley, 6 Linden Gardens, London, Enraand. r, Max, Dorotheenstrasse, 3, Briin, Ge:!..nany. Altline , ecteur l'Universite, Moscow, Russia. cheuhaetser, Dr. X., Speycrer Strasne 14, Berli9e, 1e=any. e e'lik#431nstein, E., 3, Akademies Strasse, Munich, Gefriany. oblooh, Miss Bertha • Mittledeutsche Privatbank, Ham-ourr, „) Gormany. 'ftuiaii10411Wje:. ‘ A "' ,•4e •-. _ . - _ .. f/ObBt, D. Georg, Westfalische Str. 61, Berlin, Gelnany. A A,(71,. y) ($4,y1AcvitfutA>v‘_, 170 ; s; ,--f 6144 ,40 ;,. .r•.• • • • - AupulAt, Albert, c/o La 7.3nque de 'ranee, Pa.fis, Prance. Beaulieu, M. Paul Leroy, Editor, "Economist Fl.ancais", Paris, Fa:ellne. Cnovi, Comm. Tito, Banca d'Italia, Rome, Ital y. Ccnrad, Prof. Tohannes, University of Halle, Halle, Ge2many. Ferraris, Carlo F., Camera del Deputati, Rome, Italy. Flux, A. W., Gwydyr House, Whitehall, London, England. Fomvell, H. -7., 1 Harvey Road, Cambridge, England. Franz, RobeI:t, c/o "Der Deutsche Oekononist, Burgstrasse, 3, Berlin, Germany. Frewen, Moreton, Brede Plce, Sussex, England. Georges-Levy, M. Raphael, 3 Rue de nisei XVI e l Paris, Prance. Governor, The, Bank of Belgium, Br'Aseels, Belgium. Grenfell, Edward C. Esq., J. P. Morgan London, England. Higginson Co., 22 Old Bride St., Co., 1 Bank Buildings, Price's Street, London, E.C. Engl and Hirst, Francis W., 4 Arundel St., Strand, London, England. Holland, Robert If., Post Offi3e Court, Lombard Street, Lond on, England. Korporatinn der Kaufmannschaft von Berlin (Bibliothek der) Berlin, C 2, Beirse, t. Wolf -anstr. Iandmann, Di. Julius, Swiss Yational Bank, Berne, Switxerland. Lefevre, M., Crdit Lzonnais, Boulevard des Italiens, Pari s,France. Lexis, Prof. Y., Univ-ersit:, of floettinr;en, Goettingen, Germany. Liesse, M. Andre, 18 Rue Denfert-Rochereau, Paris, France. Neymarck, 33 Rue St. Augustin, Paris, Prance. Paish, George, Editor, "The statist", Cannon St., Lond on, England. Palgrave,Sir. R.H., Pi Henstead Har., Wrentham,Suffolk, Enp:land. Pallain, M. Georges, le' La Banque dr: France, Pari s, France. Raffalovich, A., Uinistere des Finances, De Russie, Paris, France. Riesser, Dr. J., Lichtenatein-Al1ee 1 3, 71er1in, G3;many. C9arch, H. W., Bank of England, London, Enc71and. F., 3 Place de la 2 1 ourse, Paris, Prance. von Bohm Eawerck, Prof. E., Uni've-sity of Vienna, Vienna, Austria. von Luram, Dr. Karl, Director of the Reichsbank, Berlin, G:nnan7. Whalley, R. W., Esq., Gen'l 7i1n7r. "Parris Bank, Ltd., Lonion,Tnrrland. ,ithers, Hartley, 6 Linden Garriens, London, England. Wit',,ner, Max, Dorothere.nstrasse, 3, Berlin, Germany. Au Recteur Moscow, Russia. cheuhaeaser, -Dr. T., Speyerer Strasse 14, Berlin, qerT:-17. Rheinsein, E., 3, Akademies 3trasse, Munich, Germany, Knobloch, Miss Bertha, Or Mittledeutsche Privatbank, Hamburg,GermanY. Newborg, M. 60 Broadway, New York, N. Y. Obst, Westfalische Str. 61, Berlin, Germany. PUI3LICATI itiN,UESTS i. rincc Illinois: (1-1 TI-1.1•• NATIONAL - `.01TETAIN COM- 59 co.i of all fylblicatins. coldfovie: 10 copies of f'lenate docu,lent 70. 399 (Use of Credit instruments in U. 2., by Yinle). • Ptc_.linr, of Illinois: 20 colAes of f7enate docu-ent o. 399 (Usr‘ of Crcuit instr% lents, r. .radley, of 'Sew York: 3 copies of all of the publications of the Colis:..ion (for persons in his 'istrict who supplied the Co-lmission 'i.th sta:,ir:tics for the !I)ecial 1:0 (Lots from larks). i. Mlson, of Wisconsin: 100 copic of flenate docit-lont 225 (Ppecial .e.oftf; fo anks, 11.;0(.). Lawrence, of Etssachusetts: lb cories of The Direst of State Bankinc. Taws; 1'0 co ics of The 7istery of Bankinc in Canaca, by 7reckenridr-e; and 16 copies of "The Use of Credit instru-7nnts, by Yinle:, Cole, of nhio: 4 of 5 copies of The 'driest of l'tate TAnkinr IN RE MATE BILL NO. 3023 (ALDRICH BILL). 0 IMO 0 I. 0 The following questions and suczestions are asked and made with the knowledge that they are in the line of technical detail, but if they are of any importance at all they are very important, and should be clearly set forth by the wording of the law itself and not left subject to different interpretations by succeeding officials. i v If the Secretary of the Treasury is expected to approve all acts of the Comptrollers and the Treasurer, as provided at the end of Section 1, it would be well to express this in specific terms at the end in a section by itself and state that it applies to the entire bill. Page 2, Line 2 ffonds are to be deposited with Treasurer or any AsoiL,tant Treasurer. Therefore should not the Treasurer issue the receipt as at present, viz, in duplicate, and deliver original and duplicate to Comptroller; latter to retain original ,nd send duplicate to the bank? Pap 2, Line 19 Can a "bank issue Circulation ajainst United States Bonds in excess of amount of capital stock only (as at present), 4id , per , if so, would th3 excess (against U.S.Bonds) be taxable at 1/247/ annum or 1/2% per month? )Line 12 Page 3 Should not the words "of any State" follow the words "City or County", so as t.) read "by a.ny City, or County of any State in the United States?" Page 4, Line 6 Tan the Treasurer require additional or oter securities That would be very deposited, without approval of Secretary? Mr. arbitrary power to place in the hands or any one official. Treat, the present Treasurer, arees with this. Are Coupon Bonds acceptable as security for Additional Many of the hich%)st grade State and Municipal Circulation? not exceedinf: Bonds are issued in coupon form (in denominations and are not icn, $1,000 each), contain no provision for registrat Any writing upon such bonds exchangeable for Reistered Bonds. very great prewould injure their future saleability; therefore be provided in the caution and very explicit instructions should to establish rules law; or else, provision made for the Secretary goverriing such. matters. well If Coupon Bonds are to be accepted it would be coupon or for the bill to contain the specific words "either registered bonds." mean Does the word "transferred" on page q, lire 11, St,Ate a of the books a transfer by delivery, or a transfer upon tes? If the certifica new Municipality or Railroad Company, into contemplate the latter is intended, then of course the bill must a mistake. use of registered bonds only, which would be If Coupon Bonds can be used, would not one cltaced of certifiinstrument of assit_fnment and transfer (of title--not cates) to the Treasurer of the U. S. in trust for a bank, suffice for each lot of bonds of the saie kind, mentioninrc so many bonds of $1,000 (or whatever the denominations may be) and ,:ieinc tile numbers If ually made? of the bonds, the same as such assicnments are Coupon Bonds are to be accepted and a memorandum or instrument of assignment must be attached to each bond, as the bill now provides, it would be necessary to execute at least one thousand separate assignments for one million dollars of bonds, even though the bonds might all be of one issue, which would involve a trememdous amount of unnecessary detail and labor. 11?,g,e 7, Line 10 Inasmuch as the proposed amendment of Section 9, Act of July 12th, 1882 (as amended by Act approved March 4th, 1907) does away with any and all limitation upon the amount of circulation that may be retired at any time, why is the provision in relation to bonds called for redemption, any longer necessary? In re $5.00 notes Experience has demonstrated that the limitation of $5.00 bank notes to one-third of a bank's total Circulation, although well-intended, was a mistake; and the proposed bill should afford such remedial legislation as may be requisite for the convenience of the people; therefore all legal restrictions as to denominations of national bank notes should be removed and the matter left to the discretion and judgment of the banks, who can best tell what may be needed by the people from time to time. The bug-bear about the non-circulation of silver certificates disappeared long ago. All national bank notes which the people are required to accept and use as money (with no means of knowing anything about the banks issuing the same) should be by law made a first lien upon the assets of the bank (if perchance that remote possibility should become a necessity), as such notes are in no sense comparable to deposits made by a bank's own customers who do know the bank and and who make their deposits voluntarily and at their own option risk. er of Are the banks to keep on deposit with the Treasur Circunal Additio Fund for the U. S. a Five Per Cent, Redemption lation, the same as at present? nal Circulation All notes delivered to banks for additio ting notes, except present circula should be in form exactly like the on their face that they are that they would probably have to state Treasurer of the J. S. wid in secured by "bonds" deposited with the change the form of present that event it vould probably be wise to 444AA), so that all the notes Circulation (omitting the words "U.S:1;4 of the public That would preclude the possibility will read alike. been paying 6% for money by knowing that any particular bank had When adbearing a (3% tax. taking out additional Circulation depositing lawful money or other di'ional Circulation is retired by additional Circulation may continue to bank notes in tie Treasury, the after a panic or emergency has be in circulation for a ion:, time upon such notes to indicate that passed, and if there were anything Circulation, %ht fact might they were in the nature of emergency bank's reputation. operate to the prejudice of the issuing Pase,..5 1.. Line 20 inserted after the word he words"United Sta es" should be Associations having on deposit "deposit" so as to read "and such higher rate than two percentum U. S. Bonds bearing interest at a f percentum each half year, etc." per annum, shall pay a tax of one-hal There are nany misconceptions conccrnin Aldrich bill. er- be t_ substitute f,2 . an It is nzt t manent -lan of Lonetar the relief. It iE not intendec7 to in- terfere with anyone of the proposed plans which h,ve been adv3cz;..ted b;, our bankers and ctudents of political economy. Considerable criticior, h&E- been offered to the effect thbt the Tre&eury Den..rtrient would 'ilave 6.ret, difficulty in determinino. intrincic value of the .1Trio'.-s clacseL: of bon ec which :_re to be offered r.:1 security for emergency circu:btion. In rerl to tilt criticism, we micz.ht aJC that the :-overnment haE, todE.,;) ever:, bral]ch necesuary to collect this infurration, alread There Whehinwton the Der6rtrent of Commerce an cctablished in I?bor, one brEnch of v.hich consists of the aulreau of Statistics; anotner the Bure&u of Cori Lir.tions arel still another t.e Census Cffice. The buree.ue ere thoroutLthl; fariAliar v.ith equirred viith high grace nen .hiE line of work. On the other htlid, we have the Inter-2thte Commerce Commission 1..1,ich can supply ell the informatiJn needed pertaining to our great trunk lines. The Xe.tional Banking Systen tion for pore thi.;r1 fort: ::ear. haz' now been in opera- The objc, tion to the Aldrich Bill by the American Banlcrs AssocivtIon that it is impracticable, unwise and finenciallL unsound, iF etivany aprlicable to the Yational Banling %-etem. 1711en the plan of bond circulation was &dorted in 1663, the question of inflation of government bonds was raised and the same objections which were applied to the Fational Banhing setem at that time are noT raised concerning the Aldrich Bill. This bill does not intend to overthrow the safe system of note issue6 nor crippl, the lending rower of our national banks, nor will it create a fictitious bond market; neither vilt: the taxation rrovieions result in preventlng this cxtra currenc;; from being retired from circulation. I v "2" firmly believe that our barers Ere so patriotic and broadgauged that the unrrofitableness of the emergency currency when needeC_ will not be conps_idered. If ]t 2houlC prove to the contrarL the rate of taxation could be uuCified. During the national banking Act there hac been no inflation of our rublic debt and CongreE.s has not ma0e any effort to tale advantage of this system. AE a result, our covernEent bondE have commanded a rermiub, in the open merlets of thie countr: end have been referre "Ruropean bankers in a most laudable fashion. not true of wan to by That this is ropean securities reflectc great credit ui- on our nE.tiont-1 g.-)vt- rni.elit. This in large measure has been brought about by reason of our National Banling 2-LcteL. So far as criticior pertininL; to the Aldrich Bill being in the intere:t of certain Bond Syndicates, I might further ad thet for rgny :.ears the Secretaries of the Treasury have seen fit to eccert certain classes of Stte and Railwaz bonds ad security for government derosits. 7o far as I can learn there 1.u.!s been no inflation of these lcsuet_ by reason of securit]es been materIll fact, nor have the price of these Edvance by reason of this pro- vision. I c., n not see %-h L- ' these bonds havin proven en- tirely sEtisfEctory as security for governrent deroLits should not rrovE, eually as safe for emergency circulation. If our n:tiorel Immking circulation is safe, t'-)en this emergency circulation vhich ha E for its basis semi-public bonds, shou3d also be safe. If such securities should de- preciate the banks which have depoeitef them can at any the be called upon to put up additional security, and failing to dc so the bonds can be sold by the Comptroller of the Currency and the proceeds applied to the liciridation 1131, of thiLs emergene: cdrcul&tion. atntion 1,a. recently called to another ap— p&rent defect in the A15rich Bill wherein it ft_ile to make proper provision for the countr: banTr.re. The criticism came from one of your leafing PhilaCelrhia financiers.. Fe felt that certain clec: ,f street railzaz and electric ljchting bond, ran L of vhich ere held b; our co-cntry bankers :houle be rice' or such rurro see. 7hether or not this aclditional rrovieion v,ould be a viee one is a very debatable question. T believe tht any of our country banks today can compl;y with. -r_e requi rements of the Al6rich Bill for better than is general% suppo sed. Our prr:ent lonlinr; system in the opini on of most banlert-J az- stu.dent._ of roliticL1 economy is totally wrong. Our n,tio1 brikin,t: currency, a._ you know, is based upon sovernent bon, which sycten in itself Was an emergency pin p-roviin!: out of tie financing of the T7er of the Rebel lion. The plan was devise f to attract state and rrivt_te banks to becoe nbtionel inctitutibns. The owernment offered the note circtlation t: L.n inCxcerient for financit:1 institutions to becote ational Banls. 7hile it is true that nor to the war certain cities and ctateL repuOdate0 their debt, it i have E.tterTted to avoid late :Ears. orbtful if bny the payment of their just debts in Is it not a fact that such cecurities as &re authorized by the Aldrich Bill have already been accepted by Courts and Saving Tian7- i' in several of our Etetes as absolutely F.A.fe investments? Why did our biers hoE:rtily endorse the plan of Secretaries Chaw and CortelL'ou and others of receiving such bonds as securities for , .:overnront funds, Yflile they openly criticise the provisions of the Aldrich Bill which provides for a similar clace of bonds for "4" this emergenc circulation. While our national banking system has been the subject of severe criticism from its inception, still it has provided us with an absolutely safe currency. The one great weakness which it has developed has been its inlasticity. This defect, hovever could be corrected to a certain extent if certain chnses and rlodificLtions of the National Banking: Act were adorted. What is especially needed and what has proven to be absolutely syfe in recent years is the legalizing of our Clearing Fouses, so that theyr functions and operations me:- be approved by the Courts of our lend. They and our Sub-Treb.suries should be so emlated that out Cle, ,E.ring Ir Fouee AzsociEltions would become a -part of our Yetional Banking System. The country could be so districted that our principal cities would conform with our present system of sub-treasuries. If this were so, all of the uncertainty of the intrinsic valur of the rroposed bonds to be issued as securities for this emergenc: circulation would cease. The burden of determining: their value could be placed upon these Associations . In case of depreciation or default, the loss would be made good by the Associations and they in turn collect from the defaulting banhe. Of course, under such a provision every national bank in the land would be a member of one of these organizations. country banker would 1)e protected. In this way every The municipal and county bonds of each district would be thoroughly investigated and the country banker would find thtt it would be to Xis own advantage to hold a certain amount of these se- curities as a basis of an emergency circulation. This in itself would provide a better market for this class of securities than has been found in the past. The prideend rivalry of each association vould make itt 91511 them most :ealous of each other's standin,, and good name. It is certain that _f some such rlEn sere c:rviLed the Lo!r.ent any on efsaia banks was in trouble, or the bonds of t..1:1:; one of said runicipalities were unsafe, the ratter would be immediLtcly reported to that rarticular district clerinLj house assciL-tion. If deservinj, the institution would receive immediate help; to licr- idate. not, the bank vdould, have This unity of interest )uld be bulwark of strength in the hour of trol.ble and a most wise prov. ion in times of inflation. The T.LtiJnLa Banking System has its faults, but it has reverthelecc served its purpoye well by giving to us at a time v!hen sorely needed, a k;ood, cafe an. rency. stale cur- I believe it has come to stE.y in a modified form. Perhaps it 1.a bc rrsteriell-L- chanL;ed in years to come, but the funaaLenta1 rrinciplee on 14hich it is base(' vil1 be re- Th: Rani- of Pncl!,...n, the Rtn1 of France, and the Imperial Ban1-. of orerNany b reason of enjoying ,.overnr.ent deposits do much and offrr considerable aid to their governments in time of need rithout compensation. So shou. d our nation1 ban3-s, organized into some ,tich -lan as outled assist our E-overnment in times of monet&r:k stringency, because the: too enjoL certain benefits, such as bank circulation and the receit of -,overnment funds. Kinley in says : e vor on the Independent Treasury 't It is betIrr to keep a system v:hoce evils 17e know, than to adort en entirely nev one, built on an ideal plan, whose defects ye cen only guess. " result of compromises. All leE;ish.tion is the Senator Sherman informed r.e that the 7,hernav Act as his on] in nex:e. Our Federal Con- stitutiou.is tte'result of e.coLi romise. Our ear4 bunking 116 II system waL; to E, certain e:. , tent L;stern of patch-v:ork (ul. rational Banking System was colie:1 largeafter a stem in force in rew York State, lAhich had irrv.1:61.;" 1.:.ner. one Lany material changes. The Inoerendent Treasu_r:: Syctem was a welcome relief afte!) the financial :2torm arising out of the failure of 'Lie rcnewal of the Charter of the Secon0 Beni.- of the Unite: State:::. That it 1s failed in some particulars to meet Frecent needs has been clearly rroven. Among its benefits we .e the safety of our public funds and a currency redeerE.ble in rart ?:01d. and silver. It faileC, however, to rrIvide an elastic currencz., which was possible under the charter: of the First ana Second Baliks of the United States. AE a rElsult, we have adopted carious rlans of re- lief, such aL the derosit of the lgovernLent funds in natior.La banks. extraordiner;; flven this has been inadecitu,te to r:cet the strain of business conditions at various tiLes throuhout the ;:ear. or VtfiOUS Now, after both ConL:ress and banker L have faileC. tp agrec upon a permanent plan of currency reform, this 1.1drion Bill is offered ,not as a substitute, hut simr1:' as a emerLency plan. The Bill has certein weak point[., but ac a 'hole the rrinciral object to be obtained will bring that relief and corfidence which is abcolutel:- essential in tilec of financial distress. Thether the L.overnment should restrict The amount of the emergency currency to be issued and whether the governmPt should guarantee the raz,ment of thdE currr'noy without com:eneation, when it has declined to co either under the National Banlinir Act, is not so vital to the business coymunity a i the queztion concernin=- the de- derpption of this currenk% in leoful more;' on derE-md. tlis et..renc: curcemc: viii meet Vide requirement is That absolutely certain. For it will be equal, i not suicrior, to green banks for the rez_con that you will ha7c first, the banks promise to pay, second, the r.overnment's rromise to ray, third, the securities themselves, and fourth, the agreement to redeem the same at the United States Treasury in lawful money. It is not a theory bu' a condition which confronts4,44, When an emergency arises heroic measures must oftenthes be adopted to safe life or property. work. Commereikl, Financial, an So, in the economic trade relations in recent years have produced a condition in the boCz politic which must be i-et in a manly fashions otherwise, the ft,..dlure to act may again result in untold financial ruin. 7htt we need to adopt for the future is scientific banking. So many 1-lns have been advanced that an bgreement does not seem near at hand. Tie hope lies in socie action on the part of Congress looking towards this end. It is to be hoped that a Lionetarz commission ;il: be appointed during this sessioc. of Congress with full pov.er to investigate and re co,..i.end to our ntional legislators a system of banking w'rich will not only be superior to any other in the world but vill also be readily adaptable to our financial needs an0 institutions. 'ith the adoption of such a plan, let it be made absulutely essential to the furthering of our commercial life. Then and only then can we rightly take our place among the monetary powert of the world and begin to gain that mastery over foreign commerce which is justly our own. • •a • *rt. SAVINGS DEPARTMET'' OF NATIONAL BANKS AND REAL ESTATE LOANS. Summstr:: cf Replies frorn Bank Officers reltinc, t.r.brtc, •go.44.144, , *too 'ilk ,„„ ‘Ni c-A,4 - ouble Lead 7.7(fiCts rtrritr"ririTittl rn1, L671 7 7o independent, .C1 t the same time closely affiliated with the 7ational titutions and • ld sult in bringin of this cltse siness r government sup ision nj control. se p ers could grant d w' out nny wenkenInc o - he nation 1 s:7stem r'/with deci ed pro to the bt and their patrons, wh at the sam time 1the olmortu ty operate undo the national Inv ad ive the benef 4- C. ,equent thereto. Saviapet -T6 -Tiosits. mpetition between savings and nationa ks has resulted in the -t organization ter of so-called departnents, many of whioh are flourishing and in o" ,re ,-rowing more rapidly than the other departments of the Instit.6. The ban ese recounts not only pro-ftable, but they a so proving most valuable intlftetiAG_in the development of their and other business. Alt1 onl:about 2,900 of the 7,200 nationtl banks hrve ns yet estab1 s',"414,11.7s-terrftrtris-FTFFE'rrdepneitrrpripmtweir-eroTtnts -eviemrtrz0 00. The savings feature is entirely in keeping with the functions of the bank and th ,- Etab.lishment of these departments is filling a 1041-felt wrnt, the public apliNtnely being eager to take advantage of the addit*fial protection which cvornnent supervision gives to their deposits. In my judgment, however, the law 15-hoc,1d clearly define just what deposits are to be classed as saving s and 60pr/tate reuulations should govern the investment of these funds. If thelpaximum rtte of interest to be paid on such deposits we fixed, the character of the invest ment determined and the deposits made nontaxable und2r certain condit ions, the people generally would derive much greater and more permianent benefi than can ever be hoped for as the result of the existing fostr 1 t4zvings ABank /trw. ( oans. Th e is an urgent necessity or the provision of the act which limits the amount to loaned to one firm corpora ion is apParent, but./khat the law as Lt exists today is an;-thing bu perfect is equall y evident. Itirs Principal weakness is its flexibility, an at the same time the letter o he law can bo strictly observed and yet t,Zie cry object of its being be dt '-ated. A law which permits a bank to loan Z70 cent. of Its capital to ten .r even forth nr—I:ited corporations which , nll ated by one indivi or one idea and which would likely be affec disastrousl:, should the aff s of one become involved, and yet limits deft ely the amount at can be ned to one concern,regordless alike of it nherent strength, asell-li s ability to collateral the loan with unou lonable security, is certain ub,lect to criticism. Is there any reason 1 permitting an I institution to chat an_un7.imited amount of .0v-,Itism.,, ernment, lroad or other bonds flci yet rifting- the amt that can be loaned and yet lim' ng the amount that can be lot d on the same sec ities to responsible borro rs? It would indeed be disnst us were there no limit, an. in fact the prese Unit in most instances ia quilth enough and in some, entire ly •0 large, but would mdoubtedly seem most dqirirale that this present feature of law hould be so changed that tLero should be different liMits for the various'nss of loans. \ 4.at 1 ..i-4,11k--5Nlichmond, Double Lead "iri4t11711: 1671 7 sr in bl 69 ord r that when t new currency tem,pekes into effect the laws pe fu me sui ur the ernen -'of eke tion' the f th"banksj.uil up al , cons rVative line s. - the, ess The one thing which, above all othe ems to be responsiU9 for the rrepo erance of State banks is t'' - .ility of the 7ationjAAWMs to make real estate loans. Tt is easy to see how the;parei of 'Oa° revised lay, so soon after the cl d,wastating war amn real estate values were unsettled nL1 .: • err.ined, should have t necessary to prevent a bank's tying ur • ,- ,nus in long-time 195Aise ich could not be marketed easily in tim need. There is no 'rent reason existing today, howev1‘, why a fixe d oportion of the capitaWlrrlu s.. its of a "sank 8110u-id-Trot' be Iffrested 6.004.64.1...merrrtrmenwerrrIrTITTArig It is absolutely essential that a bank in a farming community should be e to make advances upon mortgares, and where ordinary precaution is taken, the risk incurred is hardly so great as in many classes of paper which can now be handled lega lly in large amounts. Of course no institution acceptingAlemand de,osits could survive if al; or an extremel: large percentage, of it funds were invested in long-time real estate paper, but between these two eNtremes there is ample oppo rtunity afforded for an amendment to be drafted which will enable the banks to make this class of loans within reasonable bounds. 7)ependent upon the F./1mnd, as I'm are, for the Pr^duction of our wealth, the government prohibits us from accepting it as security for loans and thus deprives the/ation(4/5inks of what should be one of their chief functions, viz: the employment of the funds of the depositors in the up-building of the country, upon which they thrive and which makes their deposits possible. What greater security could ne conservatixe banker desire than "the earth?" Even as it stands twlay, the law in inconsis tent in thtt it permits a bank to make unlimited investments in bonds, whic h are primarily secured by real estate and yet prohibits absolutely well marg inied loans to customers on real estate security. We are also permitted to lend 30 per cent,/ of our capital on the single name paper of an individual and yet cann ot accept his home or farm as security for even a small amount, until he has show n his inability to meet his obligations and when in all probabilit:: the security is no longer obtainable. If the law be amended in this rtrticular to a reasonable extent, with proper precautions being taken against real estate speculation and other abuses, the 7ptional Banks, and especially those in the country districts, will take a position in the work of developing the resources of this country hich they cannot possibly occupy today. Trust_ ..Powerr.--rr In au on to 'emitting real este, elionns, as outl ined above, the field of labor of the in our nationai. .zstem could apparently be broadened to great advantage to themsoli nd with • h bencifit to the public at larg e by granting them, along conserv:tive nd within proper limits, the powers now enjo yed by Trust Companies. Th,, f-anized as they are, under the laws of the various states are n estrictod to , ticular field ef endeavor, but are daily becoming more act' competitors for the come usiness of the banks. Such a provision IN do awn;: to a grert extent with t;ie present tendency of those interested 1 ati7mal Banks to orranize Trust Companies, which, while in a meas-oro 1 6717 A3d- L_• it.t4,4t) -_ Americnn 7atiota1 Bank, Lynchburc, 74tagimni-al C .."±n&tarri6 7 144°14€446"44. " '141 crt -C) '4 0 ----4 -C) ..7. C) to a6 forc-rr sint on tZle 6tbL in07•,rettorri. yours of, z' rd' ! ..,,a lellintevtocrtkion b.pank sdnt mit by ou undkr doteiof Octobor 9th, 1911. .1 We i'pknoiled Regarding our answers to questions :To. 4 and o. beg to 'dvie that we are not entirely satisfied thrt national bnnks should be permitted to mrke real estate loans at all. In the lirrht of the inform-tl -n td.t 'we are not rnssess at preset, we fool that our nnswer shold be th. in favor of such loans. e 1 671 7 94 72 : C -Clte,LIV)) "Igloo Dexter-Horton Tetionnl " . Seattle, Wash.inctona at-411-L1 11 60: We do not favor commercial banks doing a savinrs business, but if q) ) CI ? :national banks are to be granted that privilege under the supervision of your department, we blieve that if they are allowed to make loans on real estate securities the amount so loaned should be within certain lirits set by your office. ' ) 25Dshould be the outside We should sa: limit. Your. tru M. '. Pet rson, shier • •••••.... La° 671 7 First altional Ban;, 3 Escanaba, Michigan. 40 ex, e444:3 -I -] -440 Not less than I,nor over ljwith an arbitrary limit of 1 the legal limit of loans, forcing as much as possible 7 small loans well II scattered. We, here, especially need home building loans. 4 4111 Not less than nor over 1:Ountil it was tried out, unless segregatio n and restricted investment prevail, in which case a larger percentage, say 23 or 26of savings should go on real estate. Our reason for opposing segregation of savings deposits and restricted investment in savings bank securities is that a very large proportion of our deposits are savings deposits and it would materially cripple this community so far as loans are concerned if we could not loan local ly and, as I understand it, savings bank securities are confined to bond issues and fixed investments. This county is rapidly developing and if our entire savin gs deposits amounting to over ,1,100,000406 were cut out of the loan loan field, development would be very much retarded. In fact, we believe Vat the rre:ent arrangement is as good as can be devised, provided a reasonable percentage of deposits could be loaned on first mortgages on real estate. Leslie French, Pishier 1 671 7 41 Scandinavian.4merican 7etiolf) Bank of Minneapolis, Minn 41+ 2. i44 Yes not to exceelL56 9 4. 441 and reserve should be required on sFvings - same percentage as is required on other deposits. We have in same office 7 a State,' Uutual Spvings Bank, entirely separate organizations, but practically under the sarrle management. It would be better, much better, in our opinion for all concerned if deposits in savings department might have protection afforded by our capita l and stockholders liability. • tessl Dov,vv-' 1 671 7 .42 Merchants :7atir_insl Bank,:7icksburg, Miestindopp411:. , • ,i4t1 Under proper restrictions and safeguards not to exceed frflir per cent of capital stock. , 4. .idt) Loan 7‘ properly safeguarded as t percentage of value of property. Our savigs bank iE owned by alrost the same stockholders as o ntional ban;, and has same officers. We oper te in same btnki with om, sevrate clerks, books, etc. and we tr e the same time by national bank examiners. , I date (1,'e your inquiry, addressed to the cashiers of the national banks, under 9,#(1. I am afraid that I may not have made myself clear in filling out the blanks, but I want to sa;,-, first, that ' am very glad indeed that this inquiry is being made. ( ) _ We have had, almost since our organization as a national bank, a savings department, which is owned almost exclusively by the stholders of thej.:erchants, ptional; 1 the name of this bank is the Peoples f'avings Bank4)Loan Comnany. This banIrwas or- ( ganized for the purpose of taking care of seal estate loans, whieh in t'As section of the country is a very valuable part of oUr business. The bank was remnrktbly successful from the start; we organized with 450,000 capital, and now have ..,50,000 capital, 50,000 surplus, .60,000 undivided profits, and have paid POdividends since the first year of organization. Our savings deposits at this time are about equal to the conmercial deposits in the :erchr.nts :Taticnr1 Bank. ;w For several years we had considerable trouble and criticism from the Comptrollers Office, as we had the two banks in the same room, and at that time the savings bank was not being examined with the national. We suggested to a former Comptroller that he examine both banks at the same time; since that time this has be done, and we have had no further trouble. The only way that the savings bank business is reflected in the Merchants 7ations1 is the amount of cash that they carr on hand. We report this as 'due savings bank' in our report to the omptroller's ffice. We allt heartily in favor of allowing national banks to lend a certain percent of their funds on real estate collateral - of course this to be strictly safeguarded, both as to the percentage loaned and the margin in the ret.l.estate collateral offered. If you are familiar with this section' of the country, you will realize that this style of loan is almost necessary, as our country is almost wholly agricultural, and it is yery hard fcr a comnercial bank to make loans that are nct secured by real estate. 5-14nio.0 the organization of our savings bank, however, we have never taken real es pans in our national bank. We are nn e and more convinced, each day, that the Conrtrollor's office is in the hrnds.--tt a man, who wants to make the national bank system both as strong and as ef— fieent as possible. i \, Respa,e441,14.447. 7. McCoy, 7ashier) L CIAL 1 6717 Doublic First National Bank of Alba. 0 Albany, Miasomada to In my opinion a first mortgage loan on real estate not safest exceed f44ity per cent. of the value of the land is the on the loan that can be made and cashes as readily as any paper market. and If a country bank wisher to discount any of their paper other have real estate loans, they are more easily sold than any paper held by them. to In the case of personal notes a country brink is required endorse before they can sell them. state Again it puts a national bank at a disadvantaee with mers to banks and forces them to give up sore of their best custo real estate state banks because they can accommodate them with loans. AfrrarirlmilrEFET77 Y. P. Whaley) ' 41` 43 16717 100;1131 11(6546 National Bank of Ashland, Ashland, 7ebruu-lee2 -: 44 1 -9-v Ccitakker-r07-192.1. 2. .kg)1 9) - would be a liberal amount; lbwould more than meet our requirements. That amount of loans secured by good mortgages would enable us to meet a reasonable demand and would really strengthen banks as tlioy coJd take some of these loans instead of investing in commer cial and other paper that they don't know so well. I am enclosed. ing the liberty of addiLg a 1 o the answ ,-!r in ycur circular have lways bee little at sea about the so-c "savings deposits" • aria_ ot sure just what th artment meant by the term. surpcse all deposits repro ted by certificates as ;ually issued by country bank"ght be called savings ci sits. It is hard istinguish sometimes w urpose a deposit is for. e ANNUA the same kind of ce icate to a farmer wIsh to put .3,000 on interes,. r six months and a boy o *r1 for 10. The are only two of us the hank and it keeps us etty busy without debnting very over fine points a the particular miture arosits, the main thing is to go em. I ha eon cashi • f a national bank fcr some twenty five years • am strongly in favor of 1 sting - 1a • iz be properly managed but with as little re re tc take time from mo important '1-.ings as possible. --41fr 7ery refspertftary • . E. White. 1 &shier f • ,64m. Vo-ScAe 1,0,6 (iaremont 17ationa1 Bank, Clar 16717 45 nt, N'w Iltwreiti•reL In_acanaztiarett-gromittritatTe-treterb+.ette-wpoeseubmitted to national • bettiee-loy-rettr7ITTUrniela 1/771arleragrErtMe2,48;)Vg beg tc say that our experience of some te years with a sayngs depirtment has shown that it is a branch of business which can be handled without interference with the commercial department, enabling us to serve a considerable element of the population advantageously to them, and with a fair margin of profit to ourselves. 7:e sincerely trust also that you may see your way to recommending i. yout report, in connection th proposed hanges in the l'ational Bankin Laws, the enlargement f th powers of ational banks in other direetic omietiti n of stat chartered bEnks whr h are The increasin handle lines f business rem whi h national banks are • rred plats ablo a hand p on the ,Ater which o ht to e, it seems to us, remo d. e have not with ratificatic, ex essi ns, coming from the 7ecre ry the Treasu o the effect thE' b ks operating under a federal c should be g n the privilege, wide roper regulation and control, per\ , f2rming a 'timitite banking funct n. e our own cc e for exa having ri population of 7500 s ved rational ban each having ngs der)artment, and by one t tered Mutual Savi S rank : ) re empowered tc do a trust b s we would be able t get som , custom n the way of hFndling true nu ds, cting as executor under 'us, tc. and rform n locn1 service of -rlu to the community; but the such bu of oun. mess is not large enoup pro I bable to warrant the organi tipn of a separ e company with adequat capi tal. (Our present capital, f ilities, organi ation and the rublic onfidence enloyed by olr Institut' , if al/F.11a ble would enable us to ct as Trustee with the minimum of e#pense and a great() degree of securltl to patrons than an independent oepnnization with sma er capital coul well fur) nishl E Frank H. Foster, Cashler 7 16717 46 ,.......7 -.-: .1.....— ;00(Citizens :lational Bank, Tiyn, Noll* Famfierhire.J2:14.0,6 04a4ar.-1417-1912. Iron. Comitnitter-t5T-Mli1'er. wil des're„ o make morelextendej replies allow/15/ the bloflk sint me, ano T. ,,/,...,-1'. / r' answe 11 say thrt question o your interr_ ke the libefty tories thank the ro m f writing you. a tank has no 'teivings department. / In answer to question 2 it would seem as though 10 or l*of the capital of the bank perhaps might be loaned on mortgages, but I am not in favor of a very large per cent. inasmuch as commercial banks should confine themselves in their business I will amend the answer somedepartment to comercial paper and quick assets. what, however, by answering question 3, by saying that I would favor an amendment to the law specifical%.. authorizing establishing or savings departments in national banks, in which case I would favor restricting real estate loans to, say, 5tof the deposits in such savings department only, in which case I would favor keeping of the savings department accounts separately from the commercial accounts, which could be easily done by savings ledgers. r- c, -3 s banks and national banks to soerate in this State the aw so requires that twice a yeac"atVrtmtiona s I be made the •ame office, b ng howevr, that sin taneously b co ittees from both banks. I htve been exr0 fortrirtrThIrT;wftiation in the same so legislati mi t b. QueGted-tlaibt-woultio, milations which obtains ,xa,stri9tions as to of ice, alt ,•gh pe sona me to say, however, that Por this e I c, ot see any danger therein. expensive hardship to require the aities like our own it would be 11 co_ titution e ours here to oper--te In serr f any legislation was recomit would mean4r1ITT e2Pr"*"Tgirgivirega7171/737iTliltriflt meriaed it might be along the lime of authorizing-a- sings department in national banks, which licul(1 then ,ermIt a national and savings bank to consolidate under a n-tional ch. rter, and continue the savings department under said charter lawfu:ly. Unless some such provision as that is made it mi.--ht mean in some instances that the savings bank might have to either m out of business or content itself with inadequate facilities and srfeguards. It s ems to me t,ht it might be allawabln rad bank ch- ter faelit es to the eXtInt of trusee, o guarcWirft, or other fi uc executo fact thit Plis last ecrndation would i n see no ossibob trust c(anies, bu I the tlemeat an pe money of estates in increase thereby materin and equirped, ably *41 lso to even further extend national 7tinc,..he national b,ank 'to nct_ms ar, clracity. IlttYpretintle / ntely'receive orpoi t0kn of ; receivilr . ,.,a, -national bn ction kto sot of work for which it is adm/ i income. 'lc*** the imT re doing business in a al corrnuu.itr you would - procia I you th pro e ity c>f he bear to institutio s h finpecia ceythi the o two port tiekher „:14:tte ot 40 in a nrger'commun „ a si stitut' n n1X7, C. . a1 foc P I les am r and btal dy7 o expre self furtl . 7 In the ma Verez_traly-Fettfe'• d/e. er should you care to corres...... / / A. Cass, OashifIr / ( 11) D ouVie Lead --1 Feene, 240, IT.ampshir,e. 011 111Keene raticntl B- u 4 aatat...1.2.,c •1911. e d out, your circular of the 9th inctive We return herewith f* to the savings dope The write ence to o bank lents of nationl banks. •ould like to explain the view ould not in any wiq conic' pays but 2' per an ject to with mutual ve that this dep . ;;pent in a national savings department. blisiness in different co avings instit loaluag_lo.P.- Irter intrirbriertit' with mutual savi ties. ins w •anks doing a legitimnte here, for instance. In our on savings d cwal when the y the board here, in refer- This bank and they are demand obligations, sub- is presented. 3106,*-4la&M We have in this town, two good tet-gemITrtetett:i. 111, , , ,e-ToeT.le are . With deposits payable on demand, it would he very risky, in our opinion, for a national bank to allow any portion of these deposits to be tied up in real estate loans, which are not even a moderftely quick asset. :11,:uk..../orrfir?Wg gt(ytit 3410r aCCourft6 tri-ftb .6r:i1WFi rattWAggiit .,;'160.00 a deposit. T, d etiree4PWItrrnat'5 •. 1. '"'-tvshi erg lavV/IMIMIrtieso,than 16717 49 1:)04%A>le 14454 First National Bank, Croton-o:7 14the-ITudson, 7f* . 17..farIS g# CSA))) 0...94041--11.,....1.92Firr— 0 yo his: ihou 0 mak tions of sugge on wtd not q red 9th, answers to we enclose, and that is The law in regard to real estate mortgages as security for loans by national banks should certainly be changed. It is somewhat immaterial to the national banks of the country - speaking from my awn observ ation, whether or not they be allowed to invest in real estate mortgages, thrt is whether they be allowed to make permanent loans on the security of real estate itself, giving no thought whatever to the person awning the real estate. The country banks, howevor, are very much hampered in their busine ss by the law forbidding them to take real estate mort-ages as collat eral security for temporary loans. • • • I: oan on his note, and is perfectly wil o give, as additional security, a II. tgage on a piece of e owns himself or a mort7age which he may have as ment. It may be that his note is perfectly good, and the bo • ors or discount committee, of the bank would unquestion: s count the not .. t security, but is it not better to take al ,„Ailesecurity which may be offered, le may arise between the ti e making of the note nd the time the note fa • .37 ) . I. my ere is still another ca n which the law works more hardship, a that is t case depositor g a tempora and beim: , nable o u will ing o ob n endorse on s note, bein perfect lling MOr :ake as ad itional curity. In t case t board di ecto are f ced i to a choi e be on loaning the ey on the an' secur e or ing e loan d erhaps, thus o P a deposit° if y were allowe ;Puser, d' to ake the security, there woul e no question a out their making the loan. We, therefore, very strongly urge that, whatever be done about the law anowinf! national banks to invest in real estate mortgages, the law should be amended to allow them to take real estate mortgages as collateral security for temporary loans. -11yers--v (Leslie R. Palmer, resident) ead National State Bank of Tro /67/7 Troy, 74ow York3 Fi904444: ; 49 We are strongly against any amendme-A to the law allowing national banks to invest any of their deposits in real estate morti.ages as we do not consider mortgages a proper investment f r strictly colimercial banks, nor within the spirit or intent of the 'ations1/15ank*t . Assets should be as "liquid" as liabilities. 94. We are opposed to any amendment specifically authorizing establishment of savings departments or allowing any investments in real estate mortrages and also to the segregation of such deposits and restri ction of their investment. Supplementary to the specific answers to the ouestions in ;$6r circular of Cctob r 9, 1911, ,ve have to say: The first questions are ii,leg ard to "Savings' doposib . The 7e-: York rtate law at rresent will not all(90 us to use the word "Saving '; we never have used :t and do not desire to./ We hove now, and we have had •ver since this bank was established in 1852 s a rtate bank, a "Special Deposit on nterest" department in which we issue s books. These deposits can only be dra when the pass book is presented wi the check or order. r'ar regulati -ms so not (squire or provide for notice oS, ithdrawals. We also issue Certiricates of Depo 't bearing interest, payable A surrender of the certificate when properly endorsed. All our deposits payable stric on demand, without notice, whether on r certificate or on pass e do ot pay interest on daily balances except on ok. local municipal accounts d a few her accounts to which special reasons apply. Cur "Special Deposit" de nt is used largely by customers who have funds for which they have no immediF use and on which we would not pay interest if left on their business account. ve depositors in our "Srecial Deposit on Interest" department who have dealth ith us 'hrough three generations, and we have always found these "Special repo its on Int( st" the most stable in every panic. We are orTosed to ny amendments to t law specifically authorizing the establishment of Savings artnents in national nks. The old State banks had this "Special Deposit c Interest" department long fore the national bank act existed and we have cont ed it after our conversion to national bank under the 7ntional Bank Act. We woul ot favor segregation of these deposits no restriction of their investment. e find the general public thoroughly posted on e law governing national banks, a that the published reports are understood and crit 'ly scrutinized. do not believe in guuranteed deposits nor preferred deposits d do not think ther should be any radical changes In th present law under which net al tanks are no universally safe and prosperous. ''here will always be a few minor e options ui er any law. BewpaatCulskr, Henry Colvin, '- 64shiery (--) 767 1.7 ( 0u‘ 0 5 jj "4911e Bank /44w TiorkCiji ]-- New York AIX Octt_11, 1911. •-.J.;J,,i-p-! :.re , 1 1r,--tillitt we are not In favor of the establishment of savings departments in national banks for the reason that they are not needed in the cities, nnd in the country the money might be invested ill advisedly, so that we think it is much better not to alter the regulations of the 7ationtil Banking Act resrect. Youre-ver7—tratr;Olney, ) Chaa C-77/ice fresident Memo.: It will be interostinF follow this idea. L.o.n. ee if lnrg in the Dltau16717 First NationP1 Bank), New York, New Yerk:I , th)s ba • your circular letter of the 9th,instnt, ,ce w mike o rep i your v ious sal, ngs pd4co its, ce ves /0( re- eplyi ns in rala on to t Q subject. Replyiag to your inquiry :o. 2, we would favor an amendment to the law allowing national banks to invest in real estate mortgages only as a means to an end, namely, the adoption of a new comprehensive balking and ' 1> currency law, and in that case would limit the investment to 10)of deposits. Replying to your in Juiries 7os. 3, It) and 5, ther3 woul3 seem to us to be no occasion to amend the law specifically authorizing the establishment of savings deptrtments in national banks. The establishment of such dewrtments which has already been made in various places is designed, we understand, to meet the competition of trust comranies rathg.:r than thtt of savings banks. \\\\\ Jleapactfully a C. D. Backus, ( 4ashier, ( L 1677 7 52 , 94 9th beg nstan _ -) ' -National City Bank of New York, 7ew Xerl . -7 U . reply seriatim to the eive tions aske CAAA-1.0. tter of the avingi dep.-its? ou :vOr an arn4nont to the Lw allowi nationa eet n' to inc tam n percen Fro of their deposits i real estate rtgapes hat per cent s o the-iyper6f714he NstirInal City Bank, We do not . a'Possibly for the sake of banks in some of the c'tates, where the community is almost altogether a farming or agricultural one, it might be desirable to permit banks to lend their depositors or customers upon their notes, secured by mortgages on their farms. We are inclined to believe if this were permitted, the tot.1 amount so loaned should bear L-ome relation (we are not prepared to state exactly what) to the amount of the bank's time deposits. We are unable to bring ourselves to believe that deposits withdrawable strictly upon demand should be loaned on the security of real estate mortgages. ,,,,..-... Would you favor an amendment to the law specificalloutrhorizinr the tablishment of sfl,rings departments in nationa - Ilas? An Under rigis restrictions in regard the investment of the funds deposi in such departments, - yes. . Would vest If so Answ 4. Wouli you favor strictinr re state loans to a cert.in percentage . of the deposits in sadepartment? Answer. Not nocessari • the deposits of the savings department, but we are of the opinio t th hould bear some proper relEition to the posits cf the total of all the time 7f so, what p entage? re not prepared to say. Ane*;;er. W ou favor the segregation of savings deposit d the restrieti of their investment as provided by the mutual sai ban'{ laws certain Stptes? Answer. Yes. -7 Reopeetftrly, Arthr Ksvanaw.h, 4shier Ogg Lcac DOXI°1e Cnemical :Tational,Oank, New York City „...1 53 Octo1442-14, 19/1.--' fitagimiturn U;iiitagiiamaimeolomegl"trtre'rrtivrbekiertb,. 511, we have answ red the questions provided for therein, as requested. rring to Quest Ion1flowtht natl.anal ba s a certain percentage of their deposits in real estate mortj espeasksbeaffeterrr- ,-wrierrri"trInttlr—Pletree-enwiter flIy, we ber-to , soy tbat we appreciate that national banks located in small towns and villages and in rural communities would be benefitted if they were permitted to invest a certain percentage of their deposits in real estate mortgages, but, as flexibility and a liquid condition are the strongest features of any bank receiving deposits from the public, payable on demand, we believe that the genera l principle that a bank should not loan on real estate mortr-ages is a sound r_nd correct one, the country over. We can also appreciate that ban'xs located as above-mentioned would favor an amendment to the law authorizing the establishment of savings departments in national banks, but it would be necessary that the books should be kept distinct and separate but if savings departments were established, it would be well to restrict the rcentage of such deposits invested ir real estate loans to not more than 2 r,f the total amount of the savings department's deposits. Q L6-146144,--apiewered-tfr,efp-ipooymeat.146-404ieetim.re- -in thr. nerattve on yrur form, ba.44we can appreciate that certain benefits would accrue to the banks and likewise to the community in certain sections of the county, if such amendments were passed. On general nrincirles, howevr, we are opposed to the passag e of these amendments. Egg/peat-fully C• B. Lartindale, tresidont 4 (Ad 1 671 7 54 First raticnal Bank, Eantua, Ohio. t17 aotrtuV-74-,-1911. rthor in reply to your inquirie,*(will moni s are handled boo but same as handled sy that our other mone. avi We same clerks and is in same drawer. I am not so familiar w:th conditions in the cities, but in country places it is almost absolutely necessary that natio nal banks be allowed to loan to sone extent on real estate. It is the best security we can get and if we should need tc disrose of some of our raper, nothing would be cashed quicker by city banks than good real estate paper. The fact that we could not legally take on real estLte secured paper has caused us most of our losses. bunk4.1aoated-rn a farming countr;, and is owned •••••••• p.00 almost entirely by farmers. There are but to besides myself employed. Our conditiar.4-e'rer-IMT- alfferent than in many otEor places. Am not frana:-.1-Lar-:aitaa.--trite---"fnut--irmi"""1"MM so "rirTrcrt--a-novire,r_...r iviel, I. 4-bur directors have talked the matter of real estate loans over carefully and are unanimously of the opinion that they should be allowed. Pos- sibly they t:hould be restricted to towns of less than 25,000 or some thing like that. r-liqui I46e601031/6 11 "Aai tkla _QIULIADt es dairr-e4e44.tp chtl-ter runs out in a year or two eking a State s charter on account of the real ostat*,..1o442 . ; ure of the national Bank Act. The national bank system Weld be made so goo ,mapt the needs of the people so closel,vtlaat it would be preferred tc .the State s:yst of various kinds the we now have. We aiiriv,itte the efforts that have been made under your sdminIstration to imeove the bankiLg oonditiors mr the ccuntr7 snd trust that you cairiliolirjapoiretrt- the imrrrremerts thnt 71 think amAlg Ve in cort Yioup4i-ros+aetf.uplly Ira E. Hine, ashier, 1 1--N1 ( ;Ore Lead Medina County Nat7c3 i Bank, Medina, Ohio:.-"S octrtrurrr. In connection with the enclosed statement as to our vi to sav deposits and the legal ricrht of national estate mor o the other laf losns made by national bank places in Chio, are made on borrowing the money, t. dems.nd for same' more to take real es under the law, I feel it nee: ;ary to make one or two statements in addi are fulfille in regard nation enclosed. Mortgages 2, and I understand some few other mand, the agreenent with the person they shell have .7,4-'5tKir to get the money after been made, providing the obligati the mortgage This method does not tie up asets for a ion, ime any ordinary notes of a years time would do, and as there Is a ion for renewal of the notes, paper can be kept clean and fresh and fre- 1 ue_ntly endorsed notes cleanA. up or renewed. 177I am not in favor of any amendment to the law specifically authori zing the establishment of savings departments in national banks,;f ualeee-t-een L beeoererrertrlinn—grial7TrrenCiment w tically written by the esent triae-Cuoiseadeitt..- Abn41-na4- by po it c lans in Congress. , The nagarlal..bauke -of the- errantrrirPti 'VT dr5 .-Troffri• of obeying the law, and \\ , to tbat end inefficient and urwise-lmmw4aikehad not be placed on the statIdes and their enforcameynt-thereir madie..a.azazzary. :ithout the aid ,f nn:, legislation, or any other laws than those of good business sense, a lrirge number of national banks hive Instituted savings departments in their institutions, prospered and done well. Would It not be just as well to give them the legal right to loan on real estate and then let them alone? Very-rererectrunryuurN, 4 Hendrickson, ashier., 1671 7 ea 56 First Natio / Bank, Canal Dover, Ohio7_ retvre7P-rorT/Trr y you I cular letter of the 9th inst. rel tive to mortgv e 1oj4 ou ( •• ehed on er the con et; ol of t ect t of vlAal impor ance to every 11 b •epartmen In rlmost every instance, our basis of credit on local loans is real estate, Y and if we had been permitted to secure a preferred lein on this class of property Q) -.Q C) 42) in the first instance our percentage of loss would have been reduced In . addition to this we have lost a very large amount of savings deposits, and other profitable business, by not being able to assist the young men of our community to build homes after they had accumulated half the amount needed, in oursavinge department. These young men had nothing but mortgage security at the time to offer, and naturplly their future business would go to the bank thet took their mortgage. In many instances they later developed into merchants and manufactur- ers and prosperous farmers and th.t little mortgage on their first investment brings to the bank that assumed it their valued business of later successes. state and group conventi ns I ha dreds 0 national be wo om the smaller cities and d not welcome a law permitti this subje..0.4,1th hunyet to find one roper restrict- ions. hope' that the movement inOigur-ted by y frverabl‘ e/legislation Ovthe sLllect. Yerr-406a4h..iii211121• uPrWon, -Cemaifiatip r deparnt wil 717 .N....,•••• • cilifte Commercial r: ional Bank, Youngstown, Oh1.0... eetetter-rrrargigi• DOUb 1.4@ad );114. I would like to urge as strongly as possibl ) - this amendment to the national bank 11./s, authorizinf, us to some extent to loan on mortgage. In the eiti of Youngstown it is absolutely necessary for us to make some mortgage loans to hold our position in securing our share of business, but owing to the fact that it is generally known that national banks carinot under any circamstances make mortf7.age lonns a large percentage of our peoples bank accounts, both savings and checking, go to the $avings anks and 7frust Gomranies, where otherwise the national banks woald receive their fair percentage. In othor)word4, if:a depoOtor yoll /his 1s checYinr accrunt and 411i3 savinas aac,:mit and heAnts Wborrow on- 4/' mort age /and,(we cannnt sccemmodateAim, he will certainly go elsewhere wi441/ hi bankih businoss. Vorlyi—tsea4.1actifttfirr 77nnetr, Double Lad 677 CA4---11AAS "11/ E471/A/ First Nati al Bank, Viilliamsburg, Ohio:2s 0.64.46111-114T-11444.... -ft 2,1;.1 Twenty-five per cent. 7:e think this the best thing could be done for our country banks and would in no way injure the city banks for it would force the prIvete and Stat banks to send to the city banks the amount we would thus loon , giving us the advance in rite of interest. *** / I." sh to thank you for taking uV the Lest country lb anks, thnt cold be made in, permittin iement fpi/rCionay, certain per cent.YI deposits being made oil real estatekhich are make, and as I see it, it will wotk no hard , i the private al!ki State banks will be compel L the amount we take of their business, thus more for the rend/to the iity b us a chanpe to of -four money nt a better rate and a safer security. Auelqiht Nla iNatilk\ yft. f4.421,5st\.sielN. Ww...1316sodei , 4144mpo-twiativ. 1P-Mefl7-t-r1 r rcelliAVmmft ity b ks lilt out 1671 7 59 Double Dad M First 7ati A274/ et-4-44.14- al Bank, Fostoria, Ohi0 . 20 —t4 444abar...2x-p4o14,--_ 7e have always been in favor of permitting national banks to make mortfage loans and it is a handicap to the country national bank not to be allowed to do so. Our experience is panicky times, when banks were going down abort us, even in our own city, is that the depositors would be only too glad to accert mortgages In lieu of their derosits, when they would refuse tc accept their own city bonds or other form of security. Our mortgages have been limited to farm property and ,ur only loans on citzr property are those which have been taken t have been very small. secure previous debts and 671 7 Securit. NatirnaiirBank of Oklahoma City, Okis9temaa C.2.4LA:45,-/4-0 ciAsNwt.ups.matked Doub titer-A.47.4,1* u) ita afirAkte..-tqNpst.4-lini;41F4jr_Va--tfU--frAtiAystr et‘i,621 15' ' 5 urther -answer- tcfNqtre-a'titlr-2'4nt:,\lrr-wttI-e-r-±tvlt-l---tltt-rtir•-tere-rerr-_ab,okrl.d_Atary--sorti-i-nr'ttNirks-NaexnalinAn\saidrNalso‘132UP4Avfnx--t*-4cAs, say that here in Oklahoma well secured short-time real estate mortrages are fullyas liquid as any other class of assets that we have, with the exception of grain and cotton loans. This is y a cotton country, and 1.4t rural district's e Ire ts ar from err g un 1 fall, onet he lines Wfcredi are, in mwfopini n, ost' igid til tY.i5t'cott a eolutel movere estarts ach fall I be eve that oans •m winte or s. ng unt 1 fall o farmers n mode te amoun s siduld b ed to be de their arms well as on such ttele ns he/ may believe ths real est an will be pti quick, or qu Jgr, thrn the is. can on the chn n the matter of liquidity of loans, it is my opinion tIlt)t farm loans from the concerns primrrily in that business, can be obtained as quickly as retlization can be made on any other class of assets outside of the two mentioned above. The usual farm loan requires from tsp)days to a month to closeA Yaiswe'qkle7""treT77 ..140Copmvord. —Gererlirttrrir" The danger in my opinion is overvnluntion of the land by the banker. juaiectua, 1 671 144 Hi11 sboro :Tatipnal Bank, Hillsborc, Oregetlae il 61 - gatmaber"VerilPhila4, "" rb1e Lead ' ri—C„4 -A.,..1. 1. 1..; s 24,-114444- 14,1Mr4,--44.404/41,e+snir'.t*fitttirmraYrtirmtilrwillefileilkieleWitrf4"Ch P nge of 140-1Wk6440,30.441ftilkipaikiwwilam6,4411.Lowinpoilatickns1 bPnI:s tc 1ox1-7m-rmfttAftlretriylr, ..montgLggs,......piaz:1-zafiLla..iamarese- weelf pwre fully than allelee votrtId -s41ow llailiarill1"61TVrTTTIrt/Tr77"---1"t strtweet-414-eux...skiaewit....40...eqwe favor the in, loaning of at least sixty per cont of our joint derosits on real estate mortgages ON a land vclutation nc't to exceed forty por cent of the cash value of said ren1 estate. L .• 4,Caprotit produced gx,,wirr tiled,. tr-acitmeineregr-blrclr-Aeort-e-rercentart of rtzi,121,j:sag„reizefil"... taailThilmt.,14w.emwfrol Lord's 222. Ext,_,rt of lionestecd ExemPtion.. „ "Such homestead shall not exceed 0.,500 in value, .ilgoetxceed one hundred / and sixty acres in extent, if not located in town usterty laid off into blocks (and lot • if located in any such town or cit.y, it shall not exceed one block; bu in no instance shall such honest e reduced to less than twenty \ acres nor o e lot, regardless of value. -. 1C93, p. 92, Sec. 3; B. & C. Sec \;222.)" -,.. c-a-ii, flec. / Under the ;gon Exempt' law, national banks in an agricultural district like ours nr handi ped in not being allowed to loan on mortgages. At least fifty nor c of ollr farms are smell tracts of fifteen to twenty acre u.nd are beina,, 1 I ed so as to ray the owner a good profit. You will note, under tho opif.07o tion, 222, a frmer owning twenty acres of land which may berth twent housEind dollars, his personal note would not be worth t1400151per it is writte an, for the twenty acres is exempt, regardless of v/1446. The country bank can t loan all it's avt,ilable money on coq.cinl paper in c city of fifteen hu QtrePe--•titok‘fitsha-lailaabitaato. with two or44PreirstrgrrTiTIMTerre.•441ei-imeingres. We are forced to lc:,X to the farmer for at least ,j ) per cent of our loans and in an agricultural community like ours it would e a great benefit to the national banks if they were all,Ymed to loan to the small farmer.on mortr.ages, which would be gilt edge loans; it would also be a profitable line of business to the bank. al..-atiemiPtirrIr" tkiczW.LIAILIA...141, 44mtrmos-immi4a. opened state savings and trustj*.Aks in connection with their nationa1.4 PAPQ toc b41Jurs, president of one will be vice-presidenC-671Te-6rh7c., vice-versa, running both national and state savings in et1 MQ rcow, doinc Pnc8&susa, "Slitraen 43QUatf.414,1". -e read the National Bank Law an, understand it to say th(t this is not perrniesTh till it is being done every day. We do not desire to open a • Sttte savings in c n with out national. We wruld rather carry on our savings 'epartment as it isIIIII:o"-taf Age, were allowed to loan our joint deposits on real estate mort, ages. Being in competition,. p1 a national bank connected with a state savings to take care of their mortgages, and the hrndicall such as the exemption law referred to, will we be permitted to loan on mortgages which would be'tlle safest and best loans perssible in our community. he c s 1. reis) . L.L,e;s to,Li2„..;_tma....ko---11221.tior-vid2).--titg. Imre s t*-441-. your Yea,Ugar-triaJorgifiti.lioriaiatzalr;kzsp,Aiert.4. Q,A44-4, 6 ettetAt [siJ.4.A. Lumbermens 7ati nal Funk, Tortland, Creget:] :eferring to your circular letter of Oct. 9th asking us for information .as per ur sch dule, we beg to reply as fo lows: 1. Does r bank receive 4avingc dep sits? . . . . . Yes. (a) I is your sa ings depar ment operat d as a eparc, divisiori, with sep rate,19trOks, etc.. "es. (b) I your sa ,Igs dOpartment o ted _. ,a.fl th same roo with the c ercial d nent? . . . Yes. (c) Are your savings s su ject to withd awal by cleck? . O. (d) Oir only upon sentti -) of pass bocks? . . . Yes. (e) lr only u surrender of c tificttes of d posit? . .1 . Yes. r regulations provide Jo (f) for n _ ; of 4ithdrawal . . Yes. If so, do you enforce such regulatiols? . .. To. 0_3 0 I '71L1 ou Ivor "ti amot c (Ort in pe oentnto of hat ter ent.. eat. o tke)law'al ow ir Tosite in r al e /' nks" •6YE? 11. We would not favor a law allowing national banks to invest in real estate mortgages to any extent, as we regard the investment of fuads in reel estate mortpages a very dangerous matter for commerciil banks, and allowing any percentage of deposits to be so invested ould lead to many abuses by the banks. It would also be difficult for the banks to discriminate between its customers on a percentage basis, whereas at the present time we can refuse all real estate lorns. If we were tll wed to make reel estate loans on ti percentage basis we think it would be very diffiqult to draw the line at a safe proportion of our loans. .3. 7kluld y'opu for Un rilendmvnt tip th lav ' AsfcifreAly at4hcrilin eotablisiment of savings departmeate national batiks . We would favor an amendment authorizi.lg the establishment of savings departments in national banks, and allowin: t e saving rtment to loan up to a greater percentage of deposits t an the ationvl tank t dept/ now allows; but we would not favor a law that would specify a particular kind of security that should be purchased by the savings department. Especially in our Western country it would proscribe the business of the bank to sach an extent, by li-iting them to the purchase of certain high grade securities, such as you have in many of the savings laws of the Eastern States, that it would not be profitable for national banks to engae in savings business. We would not favor loans upon real estate In the savrngs departmenterN ea ;6-drt..settle. ilViistm4nt as"rrov.deAby t avPis b;I:nk laws of cer fltos A For reasons stated above, we would not favor the restriction of investments of savings funds the same as the mutual savings banks of certsin,states. Double Lead rational yank of rxford, Oxford, I 717 63 44r"411)447 441444. 10 7 " " . "" ) Herewith we are returning to you the-list oc questfc)s with outlrihwersi rtideived from you, binder date of the 9th inst. 71e answer question 3 "no" because the law as it now stands, or vs the ,pepartment now interprets it, gives us the privileges of conductinr a savings department. If the amendment suggested vould come up for discussion and be passed it would, in all probsbility, carry with it a demand on us to serregate such deposits and compel U8 tc conduct this part of the business alon g the lines of :'tate abvings _enks, and invest the mone y only in securities specified for such. This would compel us to either discontinue this department of our busi ness, or invest a good deal of the depo sit away from this center. 1 1(3 are decidedly of the opinion that we do not went any legislation thvt will disturb the present conditions. Double Lead V4/14 10104T/O.d4 2 Nils German 17stional Bxik, Pittsburgh, ..Q.etrter itt4 '67i 7 , 7 ake,p etre in ;nclosing he . ionn 64 .‘' ansVer toc:70. whic th answers to r clues io ,---, t‘your/aestiona (,‘,12 wi 10n au a in our cLinion shculd a o be nsid 1 ed. The writer has favored such changes as you sugrest for some time, and feels that under the circumstances, in this city, where national banks are paying on savings deposits, the law should be amended to such nn extent as would perm t carrying a certain pereentzTe of savings deposits in real estate loans together with chPnees in legrl reserve re .uirements on such deposits, which in -ur opinion should be 14j with the same provisions as state institutions. Viismais 1 6717 65 First iTational Bank, Arlington, Sd at.h Del!o41,1 .1±±2:11=116-3.siiiimrDouble Lead r- ' t14621 •ttl \ SW Ur k!3/1"tistQ0 );145\..9tql 9 I will Sty that in my opinion it would be to the advaLtage of national tt, n1;& 'n smiler towns in the agricultural districts to invest a portion of their funds in real estate mortgages. It is our experience that in times of depression or financial stringency, our custo— mers bre anxious for this kind of security, and that this is the first clbss of security that the bank has been able to realize on in times cf trouble. 149114.48iiipiialtaktipipriregippor Ai 17 IL. U-T1 L• dlts,px, 1 67 a-lt, 66 bt4t1Ti-st :7ation I Bank, Gallatin, Tennhame6 .1 4kmoeleimm...4411101m9.11, Idi0541 answerQ,S4bWo s 4 and o We dld n ur ciea‘ilar 1,0)r o,flOct.Ar 9t/1 beca so ofithe fact we have had no,exporience on tile subjbet aboat which i; ytt makW inquierz.. , We 1.7ie an olilnion on fy.s sukect, baikl on ge but/t 1/8 on y an. o .14on and can be of no s+loe/to f \ nment, in Wajci at . , . al busin , 988 prin ur darment,of / in comi6:: to a c6nclusion 011 the s ,- he // ffect e t1 racecU ese—cRestion As 4:he me.ority of loans made here are based on real estate values, and as so few borrowers have bonds or stoc, or other kinds of such securit ies to offer as collaterR1, banks look to the value of land owned by the borrower, and on this basis the loan is made. But as real estate loans are some times slow to realize on, we are of the 'pinion that 33 1/ )715)77n t!.1 inAcplmat)c ./. o f deposits. ol:zir\.71NrALqu letio6 oft4 (ctobi‘; 91/i914/ . shier. _DXF)C-54h\,j a11 ce-2-(47Canadian, i'exase:3 First National Bank 1 6717 .4444•460-41.3r.+94-14- Double ead Loans by national banks on real estate might be al: right in certain sections of the United States and especially in the larger cities, but as a general rule I do not believe it would be good policy. Real estate loans as a rule will have to be made for a longer time than a bank can conservatively loan for. It takes too long to realize on real estate loans especial- ly in times of depression. Shimld 4ational banks betpermitted ,t) loan a certain pereghtape tliey xfould soon be loaned up to this liA.t and/ten hilt/ife .; e sa0e fix they are mow or worse, In my opinion real estate has no business in the assets of a bank exCepting where it is necessary to take it in order to secure or collect an existing debt. The present laws are liberal enough in this respect. In savings deposits where withdrawal of same can be limited by notice a certain percentage may be safely loaned on real estate but, where deposits are subject to check on demand without notice, real estate has no business in the assets of such banks. i"..130)*\,,q.seeuN.„.1.41\49,4 MY rlite 8/Y.CAUPe'l Pertrr"... 41~i.rwafetrtr* ir , '314a d..4A4.4.4 1 6717 -\4L • . q ), Merchants :;ational Bank of Richmond, rdchmond, 17rn . k Se*.et,4044: --- 1 s.:6‘co-ta the libert f enclosing a hlet, pages 12 of which will give in general :my dens as hat anges su id bs made in the rational Ban Act ng resre I would ,ully invi e th onsider tion of your )' Department • th omission • Le advisabiljt changing th law so that there will b ferant lir.its for the Various classes of loans. \ jetirt.0 . 1, V Caoitimr. by Thomrs ch :icAdam;,,,s-Crashie 7:1„. 11a1 ic der7-rec:1/tef re 71n-- La 7ankers Associat* , Hot Srri_ s e -or ii i re Association Lake, June 22, 1911. dr s Vi inia, 6, 191 and the various provisions of the 7ational 73anking Act were lived up to in the spi as well as the letter and if this law, which' has remained practically unchanged s ce were so amended that it would better conform to the conditions of t the failure of a I-ational bank would indeed be a rare occuronce. Fundametclly," he Tntional Bank Act is soUnd and wise anil the best evidence of its strength is the wonderfully small percentage of losses which have been inc,;rred by delositors since' organization of the system. I am now sponkinr specific lly of tha'7ctional Banking Act, because its most i rortnnt provisions serve in a arge measure as the basis for the banking laws of the various States and also be ruserthe future development of the business of this country demands that the score -eFf,the operations of 7ational Banks should be so broadened as to mnke it not only'posrle but most advantageous for the various State inEtitutionc to ultimately enter the national system. That the s:-stem in its print shape ds not as yet fulfill all the requirements is best indicated by ths fact that there'rro over twice as many State as National banking institutiont in operation today, ad although a great many new 7rtional Banks are organi;ed every year and a large umber of State banks are being converted into 7ati0nfn1 institutions, new State b ks are being chrrtered in such numbers that ther is every rerson to believe 'they ' 1 continue to largely outnumber 7stiona1 b ,s until the National Bunking Act is o amended that State institutions can co uct their business profitably under it provisions. Let us hurriedly consider then a few changes in there is the adoption of which at this time would aprtrent1:- prove benefic. al. So much i being said and written about the reform of our currency system, the need for which is tniveranlly admitted, that it is quite unnecessary to &sell here upon the dote) ls of this most important of all the needed changes in the rstiontl Banking Act. We should observe in passing, however, that whether or not the PldrIch plan is ado ed, desirable amendments along other lines should be given careful tonsideratio at n the