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THE BANKING STRUCTURE
IN EVOLUTION:
A Response to
Public Demand

102nd ANNUAL REPORT 1964
The Administrator of National Banks
JAMES J. SAXON, Comptroller of the Currency
THE UNITED STATES TREASURY, WASHINGTON, D.C.




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Letter of Transmittal
TREASURY DEPARTMENT,
OFFICE OF THE COMPTROLLER OF THE CURRENCY,

Washington, B.C., September 1, 1965.
SIRS: Pursuant to the provisions of section 333 of the United States
Revised Statutes, I am pleased to submit the 102nd Annual Report of the
Comptroller of the Currency, the Administrator of National Banks, which
covers operations for the year 1964. I have also included in this Report
a statement of our policies with respect to the banking structure covering
the fields of chartering, branching, and mergers, together with several
appendices reproducing the major public expressions of the policies of
this Office during the past year.
Respectfully,
JAMES J. SAXON,

Comptroller of the Currency.
T H E PRESIDENT OF THE SENATE
T H E SPEAKER OF THE HOUSE OF REPRESENTATIVES




Contents
Title of Section

Page

The Banking Structure in Evolution: A Response to Public Demand
I.
II.
III.
IV.

A Statement of Policy
Evolution of the Banking Structure, 1900-1965.
The Future of the Banking Structure
The Data

1
7
14
15

Annual Report, 1964
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.

State of the National Banking System
Assets, Deposits, and Capital Accounts
New Charters, Branches, and Mergers
Income and Expenses of National Banks
Litigation
Fiduciary Activities of National Banks
International Banking and Finance
Management Improvement
Income and Expenses of the Office of the Comptroller of the
Currency
X. Issue and Redemption of Currency

27
28
31
38
40
48
48
50
54
56

Appendices
A. Merger Decisions, 1964
B. Statistical Tables
C. Addresses and Selected Congressional Testimony of James J. Saxon,
Comptroller of the Currency
D. Selected Correspondence of James J. Saxon, Comptroller of the
Currencv

Index




57
173
239
265

337

THE BANKING STRUCTURE
IN EVOLUTION:




A Response to
Public Demand

I. A Statement of Policy
HE NATION'S INDUSTRY and commerce are alive

T

with change. If the banking industry is to serve
their needs most effectively, it will have to match
the initiative and imagination displayed elsewhere in
the economy. The temper of the banking industry,
and the energy with which new opportunities are
created and pursued, will be critically affected by the
attitudes of the public authorities. A negative or unreceptive outlook on the part of the regulator may
dampen the initiative of banks and impede effective
response to public demand for banking services and
facilities.
For nearly four years, we have been engaged in an
effort to broaden the opportunity for private initiative
in the National Banking System, insofar as this could
properly be done in the light of existing law and the
public purpose to sustain and safeguard the viability
of the banking system. In our 101st Annual Report
to the Congress, we reviewed the changes that were instituted and those advocated with respect to the operating powers of National Banks. In this 102nd Annual
Report, we shall examine the changes of policy and
practice relating to the structure of the National Banking System.
The banking structure that is most ideal in terms
of the public need will vary with the changing requirements for banking services and facilities. Like the
operating powers of commercial banks, the structure
of the banking industry must continuously be adapted
to emerging demands and opportunities.
All of the forces of change which are at work
throughout the economy, both domestic and international, influence the ideal banking structure to be
sought. In our prosperous and vigorous society these
changes are constant, far-reaching, and of compelling
importance. Increases in personal income and population affect the volume of savings seeking productive
uses. The growth of capital and advances in technology bring new products and new industries. These,
in turn, often give rise to new communities and shifts
of population. Population movements are further
accelerated as income levels rise and permit the pur79-563—65

2




chase of new homes. All of these factors have worked
to produce demands for additional types of banking
services and for banking facilities at new locations.
The responses by the banks and the banking authorities
to these new demands and opportunities have molded
the evolution of the banking structure.
"Structure" is a term generally used to describe the
composition and dispersion of an industry, geographically, by size of unit, and by the range of products
manufactured and distributed. The structure of an
industry is also affected by the ease with which new
firms may enter and existing firms may expand. In
all industries, structure is influenced by such factors as
the location of the materials of production, the accessibility of markets, and production and demand
conditions, as well as by unique factors such as the inventive process and enterpreneurial initiative. Banking, however, and the other regulated industries, differ
fundamentally from the unregulated industries in one
significant respect—the influence of government on
structure.
In the unregulated industries, the influence of government on structure is at a minimum. In these industries, the broadest scope is preserved for individual
initiative; public controls are, for the most part, either
indirect or peripheral. Except in unusual times such
as war, it is rare in the unregulated industries to impose precise and positive rules of conduct for the individual. He is forbidden to engage in certain practices and certain governmental activities may indirectly
affect the choices he makes, but beyond these limiting
factors he has a free choice of entry and free discretion
to select his own investment, production, and marketing
policies. For example, although the total supply of
money and credit is regulated, the government does
not normally allocate their uses nor fix the prices of
goods and services produced and sold. Collective
bargaining is required, but wage rates are not fixed.
Anticompetitive accretions of market power and deceptive practices are controlled, but there is no effort
through public authority to select and enforce any
exact set of competitive conditions.
1

This is in clear contrast to the public policies followed in the regulated industry of banking. In virtually every significant aspect, the structure of the
banking industry is directly controlled by government.
Entry into banking is restricted and the expansion of
existing banks is closely regulated. No bank may be
formed without a charter from the government. No
bank may expand its size through the acquisition of
new capital or the formation of new branches without
the sanction of a public authority. No bank may expand through the acquisition of other banks without
the prior approval of government.
Underlying this intercession of government in banking is a basic public policy that sets this industry clearly
apart from others. The factor which distinguishes
banking from other industries is the public concern to
safeguard the viability of the banking system. This
concern is founded upon the central role which banking performs in the economy, and the critical significance of public confidence in the banking system.
The banking system provides the chief instrument of
payment in the conduct of business and private transactions, and it represents one of the principal channels through which savings are directed to productive
uses. In order that these functions may be performed
effectively, there must be public confidence in the
banking system. Without such confidence, funds
would not be deposited in banks nor would checks be
accepted in payment of transactions, and the performance of the entire economy would be greatly impaired.
There are three basic forms of public control that
affect the structure of the banking industry: (1)
chartering controls; (2) branching controls; and (3)
merger controls.

A. Chartering Controls
The imposition of entry controls through the requirement of a public charter represents the most
fundamental structural regulation of the banking industry. In the unregulated industries, freedom of
entry is preserved as the essential basis for the reliance
placed on private initiative to exploit profitable opportunities for serving consumer demands, and generally
to make certain that productive resources move to their
best uses throughout the economy. It is recognized
that free entry may result in the elimination of inefficient competitors, but this is regarded as a small price
to pay for the public benefits of private initiative and
innovation. Failures in banking, however, are considered to be of greater public consequence than failures in other industries because of the broad effects
on confidence in the banking system and the severe




incidence on individuals and small business firms.
Entry restrictions have thus been adopted as one of
the measures for preserving the viability of the banking
system.
Since the existence of entry restrictions deprives the
public of the full benefits of competition in meeting
consumer demands, it becomes the responsibility of the
regulatory authorities to make certain that entry controls are not so severely administered as to inhibit the
provision of needed banking services and facilities. If
the public authorities are insufficiently alert or sluggishly responsive to emerging requirements, artificial
shortages may appear. This is precisely the situation
which prevailed several years ago as a result of postwar
changes in the size and location of population and
industry.
Shortages of supply normally create mounting pressures for market entry in a capital-rich and dynamic
economy such as our own. This poses administrative
problems where there is public control of entry. As
the saturation point is approached in a market under
the pressure of new entry, it becomes increasingly difficult to make accurate estimates of need and potential
profitability. Moreover, in order to sustain the viability of the banking system, it is desirable to preserve
opportunities for new banks to grow to efficient size.
For these reasons, a temporary halt may occasionally
be required in the chartering of new banks in some
markets, as occurred under the more responsive
chartering policies of the past several years.
Some observers have been concerned lest the chartering of new banks should proceed so far as to increase
the rate of bank failures, and it is worthwhile to consider how firm the safeguards against failure should be
in the chartering of new banks. It must be remembered that bank entry is regulated not because there is
a private right of existing banks to be protected against
competition, but because there is a public concern to
sustain the viability of the banking system. It can
never be in the public interest to protect banks against
competitors who are either more efficient or more responsive to public demands. There are, moreover,
positive public benefits to be derived through the periodic introduction into the banking industry of new
competitive forces with fresh ideas and fresh talents.
An absolute safeguard against bank failures resulting
from new entry would require an absolute bar against
entry, for any new competitor will have some effect on
his rivals and will himself run the risk of failure. In
order to reconcile the need to protect the viability of
the banking system with the equally vital need to assure
sufficient production of banking services, a unique

combination of public policies has been adopted. Applications for entry are carefully screened in terms of
public demand, potential profitability, and effects upon
competitors. In order to assure the capability of new
banks to operate efficiently and effectively, certain
minimum capital requirements are imposed, and the
competence of proposed management is appraised and
approved by the regulatory authorities. The operating policies and practices of all banks are continuously supervised to sustain their solvency and liquidity. Finally, as an ultimate safeguard where failure
does occur, a system of deposit insurance has been provided. Through these measures, confidence in the
banking system is preserved without paralyzing the
competitive forces. Thus, the banking industry is enabled to undertake the risks that are required in serving
the demands of a thriving and flourishing economy.
The chartering of new banks represents, in many respects, the most delicate task which confronts the bank
regulatory authorities. A new bank represents a new
competitor, and a new competitor is rarely welcome in
any industry. On the other hand, since bank charters
are valuable because they are limited in supply, they are
actively sought by competing applicants. The public
authorities are thus subjected to intensive pressures
both from those who seek charters and those who oppose them. Moreover, in reaching decisions on charter applications, there can be no absolute certainty of
the fate that will befall new banks or their competitors.
Despite these difficulties of administering entry controls, banking must not be treated as a "closed" industry. Each new generation produces a new group
of men and women of skill and ability seeking outlets
for the use of their talents, and in our prosperous society there is a constant accumulation of capital in
search of profitable employment. In some measure,
these new productive resources will find their best
uses in the banking industry, and the public will benefit by allowing them access to that industry.

B. Branching Controls
The second principal form of structure control is the
regulation of branching. A bank may expand internally through the formation of de novo branches, or
externally through the absorption of other banks by
means of merger. Merger controls, however, raise a
number of separate issues and will be discussed in the
next section.
The policy issues confronted in branching are in
many respects similar to those which appear in the
chartering of new banks. Since the formation of a




de novo branch introduces a new competitor into a
market, the same questions arise of public need or convenience, potential profitability, and effects upon competitors. But inasmuch as branching increases the
size of an individual bank, new issues also emerge concerning the potential for greater operating efficiency
and for enlargement of the range of services offered to
consumers.
There will be some circumstances in which a new
branch will be able to serve public demand to better
advantage than a new bank. Some banking markets
can profitably support a new branch where a new bank
could not prosper. A new branch may be able to
bring to a community a broader range of services than
could be efficiently provided by a newly chartered
bank. Moreover, the abandonment of a branch will be
less harmful—both to the parent bank and to the banking system—than the failure of a new bank; thus, where
prospects are not immediately certain, or where expansion is based partially on anticipated growth in
demand, branching might be the preferred course.
The choice of whether to provide for bank expansion through new charters or through new branches is
also affected by other considerations which are discussed in the next two sections.
Much of the recent demand for new branches, as
has been true of that for new charters, stems from the
growth and shifts of population and the creation and
relocation of industries. Very commonly in recent
years, for example, the movement of population from
urban to suburban areas has deprived urban banks of
customers and created new demands in suburban
areas. Moreover, the growth of new industries often
gives rise to new working and residential communities
with new needs for banking services and facilities.
Through branching, a bank may "move with its customers" and retain its position in the industry. The
broader the geographic dispersion of a bank's offices,
the more readily may the deposits from surplus areas
be put to effective use in areas where loan demand
exceeds the deposits generated. Further, by increasing
its size, branching may enable a bank to produce some
services at lower cost. It may also enable a bank to
spread its risks more effectively and thus allow engagement in lending activities that would not be feasible
for a smaller bank. A larger bank, moreover, has a
larger legal lending limit and so may serve certain
classes of customers more effectively than smaller
banks.
In the unregulated industries, the economies of
scale actually realized, and the variety of services actually performed, are determined competitively. In

banking, however, the regulatory authorities have the
ultimate responsibility to choose the means of bank
expansion best calculated to serve the public interest.
Their decisions will inevitably affect the prices and
range of products and services offered to consumers.
The authority to permit the formation of branches
is much more severely restricted than the power of the
regulatory authorities to allow the creation of new
banks. These long-standing traditions with respect to
branch banking have had a deep-seated and farranging effect upon the entire banking structure of the
country, and upon the performance of the banking
system. They have greatly enlarged the number of
banks, hampered the growth of banks to most efficient
size, inhibited the development of specialized services
by many banks, and diminished the effectiveness and
efficiency of the banking system in the vital task of
facilitating the movement of capital to its best uses
throughout the Nation. In some degree, these limitations have been overcome through the solicitation of
loans and deposits in areas beyond the powers to
branch, and through the establishment of affiliates,
satellites, or holding companies. These, however, represent generally inferior means for the expansion of
banking operations.
There is the mistaken belief that broader authority
to permit branching would lead to harmful effects
upon competition in the banking industry. Greater
power to allow the formation of branches, however,
would merely add to the discretionary authority of
the regulatory agencies. Equipped with a more extensive range of alternatives, the banking authorities
would be in a better position to choose the precise
means of bank expansion most suitable to serve the
needs of individual banking markets, and most likely
to provide the required services and facilities at the
least cost. Indeed, the risk of monopoly power is
greatest where the greatest reliance is placed on unit
banking. Since new branches might be able to operate profitably in markets where new unit banks could
not survive, the prohibition of branching would exclude potential competitive forces from these markets.
There is no consideration of the public interest
which would justify an absolute withholding of the
branching tool from the regulatory authorities. The
only proper basis for the restriction of branching is
the suitability of this means of bank expansion to serve
emerging public demands in particular banking markets. Under this principle, the regulatory authorities
should have the full discretion to authorize the formation of branches wherever they can serve the public
interest to best advantage.




G. Merger Controls
The third means by which government influences
the banking structure is through direct administrative
control of mergers. In the unregulated industries
mergers may be freely undertaken, subject only to
prosecution under the antitrust laws. In banking,
however, mergers require the prior administrative
approval of a regulatory authority, and the regulatory
agencies in reaching their decisions apply a variety of
statutory criteria relating to the banking and public
consequences of proposed mergers.
The desire to merge is critically affected by the
power to branch. Merger applications rarely appear
in no-branch States because a merger under those
conditions usually requires the closing of one of the
merged banks. Thus, two tools of structure control
are effectively lost where branching is prohibited, and
needed bank expansion must take place almost entirely through new charters.
The public benefits which may be derived from
mergers stem basically from the economies of largescale enterprise, and the greater variety of services
which larger firms may offer to consumers. These
benefits will arise where increases in the scale of operations yield savings in costs, or where a broadening
in the lines of production or the extension of operations to new markets permit greater dispersion of risks
and thus allow the undertaking of ventures unsuitable
for smaller firms. A larger and more broadly based
bank may also be able to offer specialized services
which are not profitable for smaller institutions, and
should be able to move capital more efficiently from
surplus to deficit areas. Moreover, the legal lending
limits of banks require the presence of larger institutions to meet the needs of larger businesses most
proficiently.
In our public policy for the unregulated industries,
we have generally distinguished between the growth
of firms through internal expansion and their growth
through merger. Growth through merger has been
viewed with greater public concern because it entails
the elimination of competitors and, for this reason,
merger limitations have been imposed through the
antitrust laws. The direct administrative controls applied to bank mergers are also based in part upon
the competitive effects of such mergers, but, as we
shall see, the banking authorities apply a variety of
other public interest criteria in deciding bank merger
cases. These criteria are specifically related to the
fact that the banking structure is under direct public
control.

There is some probability that growth through
merger may have a more adverse effect on the liveliness of competition than growth through internal
expansion. However, there are countervailing considerations. A merger may enable a firm to acquire
plant, personnel, and market-access not otherwise
readily attainable, or attainable only at greater cost.
More fundamentally, even though the intensity of
competition may be adversely affected by growth
through merger, merger may nevertheless produce
benefits of larger-scale production which are in some
degree passed on to consumers in the form of improved
service or lower prices. The task of public policy is
to allow those increases in the size of firms that are,
on the whole, beneficial to consumers, while restricting those that are, on balance, harmful.
There are two reasons why merger may often be
the preferred course of expansion in banking, even
though in comparable circumstances reliance on
internal growth may be more appropriate for the
unregulated industries.
First, the banking authorities have a positive responsibility to see that the public convenience and need for
banking services and facilities are met. In carrying
out this responsibility, they do not have the authority to
require the provision of service such as is found in the
fully regulated industries like the "public utilities";
their choices are limited to the private proposals for
bank expansion presented for their approval. If they
find that a proposed merger will yield public benefits
and they see no superior means for achieving these
benefits either at hand or in clear prospect, they have
a strong positive reason for approving the merger. In
the unregulated industries, there is no public responsibility to fashion industry expansion according to the
public need; reliance is placed on private initiative and
no public authority faces the problem of choosing the
form or method of industry growth.
Second, in choosing the best means to serve the public convenience and need for banking services, the
banking authorities must appraise the alternatives in
terms of the effects on the solvency and liquidity of
competing banks. Bank merger proposals are generally designed to provide new services to a community, to provide services at lower cost, or to enter
new markets. The alternative means of achieving
these purposes are new charters and de novo branching. If the existing banks in a market are poorly managed, financially weak, or unprogressive, such added
competition may threaten their solvency or liquidity
and merger may constitute the only effective means of




bringing improved service to a community without posing a threat to bank viability.
In the unregulated industries, there is no public
concern to safeguard individual firms against failure.
Indeed, in these industries freedom to compete and to
eliminate less efficient rivals is essential to the reliance
placed on private initiative to serve consumer demands.
It is therefore appropriate in the freely competitive industries to impose more severe restrictions on growth
through merger than are applied to banking.
Bank mergers have sometimes been opposed on the
ground that, although they may improve service for
some classes of consumers, they may do so at the expense of others. Some classes of consumers, however, have needs which only larger banks can serve
efficiently. If other classes of consumers are disadvantaged by a merger, a new opportunity is presented
to competing banks and the banking authorities may
respond by authorizing new charters or new branches.
In this way, the needs of all classes of bank customers
may be served most efficiently and most effectively.
The Bank Merger Act of 1960 provided for direct
administrative control of bank mergers by the banking
authorities, and established broad public interest standards to guide the administration of these controls. In
addition to the "effect of the transaction on competition (including any tendency toward monopoly)," the
banking agencies are required to consider the financial
history and condition of each of the banks involved, the
adequacy of their capital structures, their future earnings prospects, the general character of their management and, most significantly, "the convenience and
needs of the community to be served." Mergers are to
be approved only where, after considering all of these
factors, the transaction is found to be "in the public
interest." Since the passage of the Bank Merger Act,
however, two Supreme Court decisions have subjected
bank mergers to the antitrust laws. This has given
rise to ambiguities of policy and conflicts of purpose.
The problems are both philosophic and procedural.
There is no serious dispute about the desirability of
applying antitrust principles to the unregulated industries. Since in those industries primary reliance is
placed on individual initiative and private enterprise
to meet consumer demands, there are justifiable reasons for preserving freedom of entry and restricting the
acquisition of market power in order to enable the competitive forces to function. In banking, however,
entry and expansion are under direct public control.
The competitive forces are purposefully restricted in
order to safeguard the viability of the banking system,
and an effort to apply conventional antitrust principles

in these circumstances is almost certain to conflict with
bank regulatory objectives.
This is well demonstrated by the difficulties that
have been encountered under the Bank Merger Act
since the Philadelphia and Lexington decisions brought
bank mergers under the antitrust laws. Although the
banking agencies must continue to reach their decisions
according to the broader public interest standards set
forth in the Bank Merger Act, their decisions are now
subject to attack in the courts under the narrower
standards of the antitrust laws.
This impasse can be clearly resolved only be exempting bank mergers from the antitrust laws completely as
has been done in other regulated industries, or by subjecting such mergers to the full application of those
laws. If this latter course is chosen, the Bank Merger
Act should be repealed. There would seem to be no
valid reason for subjecting banks to more onerous
premerger requirements than apply in the unregulated
industries if bank mergers are to be subject to attack
under the antitrust laws. More fundamentally, if it is
to be public policy to apply conventional antitrust concepts to banking, it logically follows that bank entry
and bank branching should also be free of direct public
control. The least satisfactory course is the present
one of entrusting regulatory powers to the banking
agencies and judging the exercise of those powers on
the assumption that the competitive forces are to be
fully preserved and fully operative. It should be
observed, however, that a decision to move toward
free bank entry and expansion raises questions which
go beyond the problems of banking structure. It is
highly doubtful that bank operating practices could be
effectively supervised, and the viability of the banking
system sustained, without some form of public control
over the banking structure.
There is one intermediate course through which a
reconciliation might be achieved between the Bank
Merger Act and the antitrust laws without a statutory
change. The courts, in antitrust cases involving bank
mergers, could take cognizance of the fact that banking
competition is restricted through public regulation,
and that bank mergers receive prior adminstrative approval from a public authority according to broad




public interest standards which transcend purely competitive considerations. This approach would not be
as clear-cut as the other alternatives we have presented,
and would undoubtedly leave large areas of uncertainty for long periods. Nevertheless, if in bank
merger cases the courts considered the unique competitive conditions which prevail in the regulated industry of banking, there would be a greater likelihood
that the antitrust criteria developed principally with
the unregulated industries in mind could be adapted
to banking without impairing the effectiveness of bank
regulation. An effort to test this approach for accommodating these two basic strands of our public policy
was recently undertaken by the Comptroller of the
Currency as an intervening defendant in an antitrust
action relating to the merger of the Mercantile Trust
Company N.A. and the Security Trust Company, both
of St. Louis.
There is one administrative procedure under the
Bank Merger Act which should be modified if that
Act is to remain in force. At present, the banking
agencies not directly involved in a merger decision
are required to submit advisory opinions on the "competitive factor" to the responsible agency. Since this
factor comprises only one of the seven considerations
required to be taken into account, the advisory opinions
do not represent a judgment on the desirability of a
merger. Nevertheless, differences between the advisory opinions and the decisions on mergers have often
been falsely cited as evidence of differences in merger
policy among the banking agencies. Moreover, five
years of experience under the Bank Merger Act have
demonstrated that the advisory opinions of the banking
agencies not faced with the responsibility of decision are
ordinarily routine and rarely present facts or ideas
unknown to the responsible agency. There seems
to be no proper reason for continuing this procedure.
Retention of the Justice Department advisory
opinions may appear to have greater justification.
However, the role of the Justice Department in bank
merger cases will ultimately rest on the resolution of
the more fundamental issue of the proper applicability
of the antitrust laws to the regulated industry of banking.

II. Evolution of the Banking Structure, 1900-65
HE COMMERCIAL BANKING industry is a service

T

industry that has customer relationships throughout the economy. Consequently, the evolution
of the banking structure has been significantly conditioned by changes in general economic activity. The
other principal influence on the banking structure has
been the system of public controls described in the preceding section. Among these controls, branching
limitations have had the greatest effect on the banking
structure as evidenced by the disparate conditions
found among unit and branch banking States.
The evolution of the banking structure since 1900
may be sketched in broad terms by a comparatively
few numbers. (See Chart 1 and Tables 1 and 2.*)
In 1900, there were approximately 13,000 commercial
banks, and they operated only about 100 branches.
Twenty years later, the number of banks had risen to
29,000, and the number of branches to 1,300. The
Great Depression took a heavy toll and, by the end of
1934, the number of commercial banks had dropped to
about 15,400. Branches, on the other hand, had
begun to assume greater importance as indicated by
the nearly 3,000 in operation that year.
During the next 30 years, there was a gradual decline in the number of banks which was reversed only
in the 1963-64 period. However, branch operations
became increasingly important during this period.
Although in 1919 only 4 percent of commercial banking offices were branches, by the end of 1964 the proportion of branches had risen to 51 percent.
We turn now to a brief examination of the evolution
of the banking structure, with particular emphasis on
the period 1961-65.

A. Rapid Expansion: 1900-20
Although the statistics on banking structure before
1920 are relatively sparse, it would be misleading to
*The tables supporting this section will be found in Section
IV, The Data.




use the 1920 banking structure as a benchmark against
which to measure succeeding developments. Spurred
by a period of economic expansion in both the industrial and agricultural sectors, and uninhibited by significant legal barriers to entry, an unprecedented expansion of about 130 percent occurred in banking facilities during the 1900-20 period. This expansion
was almost entirely in the form of new banks, and it
was concentrated heavily in the agricultural States of
the Midwest and Great Plains. Branch operations at
that time were relatively insignificant.

B. Sharp Retrenchment: 1921-34
In the 13 years following 1921, the number of commercial banks declined by approximately half. The
major part of this reduction took place during the
depths of the depression, 1930-33, when 9,000 banks
failed and another 2,300, many of which were in financial difficulties, were absorbed by other banks. Perhaps of greater significance, however, were the more
than 5,000 bank suspensions which occurred during
the 1921-29 period while most sectors of the economy
were prosperous.
A number of factors contributed to the unstable condition of the banking system in the 1920's. The great
increase in the number of banks from 1900 to 1920
had raised the number of banking offices in relation to
population to a historic high. Many banks were established in small, farm-oriented trading centers at a time
when the agricultural sector was participating in the
general prosperity; the pronounced weakness in this
sector during the 1920's precipitated the failure of a
number of these small, specialized institutions. The
increased use of automobiles revolutionized shopping
habits, and in so doing increased the competition
among scattered banks. The growth of large-scale industrial and commercial activity increased the demand
for services which only large banks could offer, and
thus led to the absorption of a number of smaller
banks.

Chart 1
Commercial banks and commercial bank branches in the U. S.,
1920-1964
Number of banking offices
30,000

25,000

15,000

10,000

5,000

1920 1924

1928 1932

1936 1940

1944

1948

1952 1956

1960

1964

Source: Table 1

The Midwestern and Plains States in which much
of the bank expansion of the 1900-20 period took
place were mainly unit banking States, and those
States also accounted for a very sizeable proportion of
the banks which failed in the 1921-34 period. In this
period of banking instability, the subsequent growth
of branch banking was foreshadowed. By the end of
1934, branches represented 16 percent of all commercial banking offices, compared with 4 percent in
1919. (See Table 3.)

G. Consolidation: 1935-46
The reorganization of the banking structure forced
by the depression was largely completed by the end
of 1934. At that time, there were 15,353 commercial
banks and 2,973 branch offices in operation. The
next 12 years, including the period of World War II,
were characterized by relative stability in the banking
structure. Principally as a result of mergers, the
number of banks declined slowly to 14,044 at the end
of 1946. Although the number of branches increased
by 1,008 during the period, to 3,981, this did not offset
the decline in number of banks, so that the number




of commercial banking offices fell from 18,326 to
18,025.

D. Postwar Adjustments; 1946-60
The most striking feature of the banking structure
in 1946 was the fact that fewer commercial banking
offices were in operation than at the end of the period
of drastic banking reorganization 12 years earlier.
Yet, in the interim, wartime demands had generated
a high level of economic activity, and income and
population had increased substantially. Gross National Product in 1954-dollars was $282.5 million in
1946, compared with $138.5 million in 1934, an increase of 104 percent. The population of the country
increased by 11 percent in the same period. Further,
the wartime shortages of many goods and the complete absence of others, coupled with the relatively
high levels of wartime income, had created a backlog
of demand which promised to spur postwar economic
activity.
It is plain that in 1946 the country as a whole
required additional banking facilities to allow the
banking needs of the public to be met fully and effectively. This was especially true in those urban areas

Chart 2
Commercial banks and branches, by State groups classified by branch law, selected years

Number of banking offices
Statewide branch banking States

12,000

Unit banking States

Limited branch banking States

j l p f f Branches
| ' | Head offices

10,000
8,000
6,000
4,000
2,000
0

1919

1934

1946

1960

1964

1919

1934

1946

1960 1964

1919

1934 1946

1960 1964

Source; Tabje 3

that had experienced the greatest economic growth
during the war, and in those rural areas where banking retrenchment in the 1920's and 1930's had been
most extreme.
In the 14 years from the end of 1946 to the end of
I960, the number of commerical banking offices increased from 18,025 to 23,716. Although the number
of banks declined from 14,044 to 13,473 during the
period, as a result of merger absorptions in excess of
new bank formations, there was a great increase in the
number of de novo branches. Branch offices, including those resulting from mergers, increased from 3,981
at the end of 1946 to 10,243 at the end of 1960. There
were, it should be noted, significant variations among
the States in the increase of commercial banking
offices: 67 percent in statewide branching States, 35
percent in limited branching States, and 10 percent
in unit banking States. (See Chart 2.)
The overall increase of 32 percent in commercial
banking offices from 1946 to 1960, although substantial, failed to keep pace with the growth of real
Gross National Product, which was 56 percent higher
in 1960 than in 1946. There thus remained at the
end of the period as great a need for additional banking
facilities as prevailed at the beginning.




E. Economic Growth and Bank Expansion:
1961-65
1. NEW BANKS AND TOTAL NUMBER OF BANKS

During the period from 1961 to mid-1965, the Nation enjoyed its longest peacetime expansion in history.
Real Gross National Product was 17 percent higher in
1964 than in 1960. Population continued to grow at
a much higher rate than during the economically depressed 1930's.
The number of commercial banking offices increased
by 18.5 percent during the years 1961-64, compared
with a 12.9 percent increase in 1957-60, and an 8.7
percent increase in 1953-56. The 1961-64 expansion
occurred in response not only to the banking needs
generated by the economic growth of those years, but
also to the unfilled demands that existed at the beginning of the period.
The number of commercial banks increased slightly
during the period 1961-64, the first such increase over
a four-year span since 1945-48, and only the second
since 1920. Although new charters averaged only
about 91 per year during the period 1947-60, the
average rose to about 235 in the years 1961-64. (See
Chart 3.) Only 20 percent of the new commercial
banks established in the 1947-60 period were National

Chart 3
Newly-organized commercial banks in the U. S.,
by class of bank, 1958-1964
Number of banks
240 |

200 I

| | j | | | National Banks
I I H I State Banks

80

1958

1959

1960

1961

1962

1963

Chart 4
Newly-organized commercial banks, by class of bank

Source: Table 4

10




Chart 5
Commercial banks and branches by class of bank,
1960-1964

Number of banking offices
18,000 j I Branches
I Head offices

15,000

12,000

9,000

3,000

N S
1960
N - National Banks
S - State Banks

N S
1961

N
S
1962

N
S
1964

Source: Table 5

Banks, but the proportion rose to 49 percent in
1961-64. (See Chart 4 and Table 4.) The higher
rate of chartering led to a 2.4 percent net increase in
the total number of National Banks in 1963 and a
3.4 percent increase in 1964; the comparable net
increases in State banks were 0.3 percent and 0.4
percent. (See Table 5.) The rate of chartering of
National Banks declined, however, in the second half
of 1964 and the first half of 1965.
The volume of new chartering was strongly influenced by the prevailing branch laws. Of the 826
banks chartered in 1962-64, 59 percent were in the 16
unit banking States, 22 percent in the 17 limited
branching States, and 19 percent in the 17 statewide
branching States and the District of Columbia. (See
Table 6.)
Although the majority of new banks were located
in unit banking States, it is interesting to note that
the ratio of new banks to total banks in existence was
higher in statewide branching States than in unit
banking States. This pattern is attributable mainly
to the much larger number of existing banks in unit
banking States; at the end of 1964, there were 7,173




N S
1963

banks in unit banking States and 1,087 in statewide
branching States.
In every year between 1952 and 1964, the number
of commercial banks increased in unit banking States,
the total increase in the 12-year period being 13.1
percent. In limited branching States, a slight decrease
occurred in the number of banks each year in the same
period, with a total decline of 13.6 percent. There
were 19 percent fewer banks in statewide branching
States at the end of 1964 than at the end of 1952,
though the number increased slightly in 1963 and
1964. These movements in the total number of banks
are largely explained by the relatively infrequent disappearance of banks through merger in unit banking
States, and by the fact that the branching alternative
tended to hold down the number of new banks in
branching States.
2. BRANCH EXPANSION AND THE TOTAL NUMBER OF
BANKING OFFICES

Despite the increase in the number of new banks
in recent years, most of the expansion in banking
facilities has taken the form of de novo branching.
11

Chart 6
Percentage changes in real disposable income, population,
and commercial banking offices for States grouped by
branch law, 1951-1964

20

Real disposable personal income1
1

1951-1963

Population

The number of branches operated by National Banks
rose from 5,325 at the end of 1960 to 7,957 at the end
of 1964, a 49 percent increase. During the same
period, branches of State banks increased by 30 percent, from 4,918 to 6,381. (See Chart 5.) Continuing the long-term trend, branches represented 43
percent of total commercial banking offices at the
beginning of the period and 51 percent at the end.
The rates of growth in population and income since
1950 for statewide branching States have outdistanced
the comparable rates for the limited branching and
unit banking States. (See Chart 6.) For example,
in the statewide branching groups population increased by 16.6 percent and 7.8 percent, respectively,
for the periods 1956-60 and 1961-64. (See Table
7.) The comparable figures for the limited branching
States were 6.9 and 5 percent, and for the unit banking States, 9 and 5.5 percent. Personal income movements showed a similar spread for the same two
periods; the percentage increases were 38.8 and 27.5
percent for the statewide branching group, 26 and
20.6 percent for the States with limited branching,
and 31 and 20.6 percent for the unit banking group.
These differential rates of economic growth were
accompanied by marked differences in the percentage
increase of total commercial banking offices during

12




Commercial banking offices

.Source: Table 7

1961-64. In the statewide branching States, the increase was 30.4 percent; in the limited branching
States, the figure was 18.4 percent; while the unit
banking States experienced only a 9.9 percent
increase.
3. STRUCTURAL CHANGE THROUGH MERGER

The principal avenue for the exit of banks in recent
years has been absorption through merger. Most
mergers in the postwar period were not of an emergency character involving near-insolvency on the part
of the acquired bank. This is in sharp contrast to the
situation found in many mergers of the early 1930's.
From the date the Bank Merger Act went into effect
in 1960, through June 30, 1965, 459 merger transactions took place in which the resulting bank was a
National Bank; these involved the absorption of 473
banks. The majority of the acquired banks were
small; 317, or 67 percent, had assets of less than $10
million; and 416, or 88 percent, had under $25 million
in assets. (See Chart 7 and Table 8.) Only 8 of the
459 transactions, or less than 2 percent, involved the
union of 2 banks each having more than $100 million
in assets. Less than 8 percent took place in unit
banking States where a merger would usually require
the closing of one of the merged offices.

Chart 7
Classification of acquired banks by size
in those mergers under- the Bank Merger Act
in which a National Bank resulted, through June 3 0 , 1965

Assets less than $10 million—
317 banks (67.0 percent)

Assets $25 to $49.9 million—
35 banks (7.4 percent)
Assets $50-to $99.9 million—
14 banks (3.0 percent)
Assets $100 million or over8. banks (1.7 percent)

4. T H E INCIDENCE OF BANK FAILURES

As contrasted with earlier periods, the bank failure
rate has been exceedingly small within recent years.
In the period from 1952 to the middle of 1965, only 62
commercial banks failed. (See Table 9.) Of these,




9 were National Banks, 33 were insured State banks,
and 20 were noninsured State banks. These figures
show that commercial bank failures have averaged less
than 5 per year out of a total bank population of 13,500
to 14,000.

13

III.

The Future of the Banking Structure

HE MARKETS FOR BANKING services vary from
those composed of small depositors who require
only convenient access to savings accounts and
checking facilities, to the largest business firms which
have need for a great variety of banking services
throughout the country and even internationally. In
this spectrum of markets, there is a role for banks of
a diversity of sizes. Well-managed, efficient, small
banks have a special appeal to certain classes of consumers and a unique competence to serve their needs.
Equally, there are banking requirements that only large
institutions can meet efficiently and effectively. The
task of structure policy is to seek that balance among
banks of various sizes which will accord proper recognition to the production advantages of each, and to
the specific capabilities each may possess for meeting
the varied demands of the consuming public.
The record of structural change in recent years demonstrates distinct progress toward that goal. Yet there
remains one obstacle which continues to hamper the
attainment of an ideal banking structure, and which
will deeply influence the future performance of the
banking system.
The industrial and business structure of the Nation,
which has made possible the great achievements of the
economy through the years, could not have been attained without the freedom of trade we have enjoyed
within and among the States of the Union. The freedom of labor and capital to move throughout the country in response to anticipated public demands, and the
liberty to undertake creative new ventures, have been
indispensable elements in the lively and spirited economy which has characterized our history. Banking,
along with certain of the other regulated industries,
represents the one major segment of the economy in
which this basic principle of freedom of trade has not
been fully applied. As a result, many banks have been
barred from the complete realization of production
economies, and many communities have been deprived
of the broader range of banking services which could
have been provided to them.
These limitations over branching may, in a sense,
be attributed to the duality of the banking system,
but they are not inherent in that system. Properly
conceived, the dual banking system can be an effective

T

14




instrument for perceptive adaptation of banking to
the Nation's needs. The dispersion of banking controls among the States and the Federal Government
broadens the opportunity to develop new ideas and
to test new approaches. It enables either segment of
the dual banking system to supplement the other
where deficiencies arise in service to the community.
This is the great strength of the dual banking system.
Some observers have equated the health of the dual
banking system with uniformity and equality. They
are concerned lest either segment of the system gain
an advantage over the other. There is, however, no
risk that either part of the dual banking system will
achieve a publicly harmful position of superiority.
Competitive superiority can be attained only through
more efficient and more effective service to the public,
and it can never be in the public interest to restrict
the initiative of one segment of the dual banking system for the purpose of protecting the competitive
position of the other. The best hope for the future
lies in greater freedom for each of the systems to meet
the ever-changing public demands for an ever-increasing variety of banking sendees and facilities.
The Nation looks forward to a future of growing
population, improved personal skills, rising incomes,
increasing accumulation of capital, advancing technologies, a broadening range of products and services
offered to consumers, and expanding interests throughout the world. To meet these needs and opportunities,
a sensitively responsive banking system, alert both to
present and future requirements, is essential. No tool
that is useful to improve the functioning of the banking system should arbitrarily be withheld, nor should
any be applied except in furtherance of that aim.
The ultimate surpassing factor in the progress of the
economy has been the spirit of initiative and innovation which abounds in our society. That spirit must
be sustained and nourished in the banking industry if
the promise of the future is to be fully realized. The
continuing challenge is to devise new and better ways
to serve the public demand. This calls for persistent
questioning of present methods, ingenuity and inventiveness in the conception of improvements, and
the enterprise to carry them out.




The Data

T A B L E 1 .-—Commercial banks and commercial bank branches in the United States,* 1920—64
Number of
banks

Percent
changein banks

Number of
branches

Percent
change in
branches

Total
coTHtnerCial
banking offices

Percent
change
in total offices

30, 367
29, 086
1,281
0.38
2,297
-3."l0'
79.31
30, 482
28,185
24, 968
-11.41
3,138
36.61
28,106
— 7.79
17, 802
- 2 8 . 70
3,195
1.82
20, 997
—25.29
15, 120
-15.07
3,270
2.35
18,390
— 12.42
14, 344
-5.13
3,525
7.80
17,869
-2.83
„
.26
13, 992
-2.45
3,924
11.32
17,916
14,164
1.23
4,349
10.83
18,513
3.33
14,049
— .81
5,274
21.27
19,323
4.38
13,642
- 2 . 90
7,360
39. 55
21, 002
8.69
13,473
-1.24
10,243
39.17
23,716
12.92
13,760
2.13
14, 338
39.98
28, 098
18.48
*Data exclude banks and banking offices in territories.
fThe 1920 data are as of June 30. The remaining data are as or years-end.
of
I i n e lyZU
oijune ou. I he
Sources: Office of the Comptroller of the Currency, Annual Report, various years; Board of Governors of the Federal Reserve
Syst< Federal Reserve Bulletin, various issues; Board of Governors of the Federal Reserve System, Banking and Monetary Statistics,
tem,
•3.
1943.

1920f
1924
1928
1932
1936
1940
1944
1948
1952
1956
1960
1964

The figures presented in the text and tables represent, insofar as possible, the total number of commercial banks and banking offices located within
the various States of the United States. Sources
which justified their total figures by a breakdown
among States were used in preference to sources
which did not. This procedure was adopted simply
as an aid in evaluating the probable accuracy, especially for the earlier years, of the limited sources
available.

1920
1924
1928
1932
1934
1936
1940.
1944
1946
1948.
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964

The second procedure applied involved the use,
wherever available in the form indicated above, of
reports of the Office of the Comptroller of the Currency for National Bank Data, and reports of the
Federal agencies having jurisdiction over State banks
for State bank data.
These two procedures lead to slightly different
total bank and total banking office figures than have
appeared in the reports of any one banking agency.

T A B L E 2.—Commercial banking offices, gross national product and population of the United States, 1920-64
Percent
Percent
Percent
Gross national
Commercial
Population
change
change
change
product
Tear
banking
(4-year
{4-year
(4-year
{millions)
{billions of
offices*
periods)
periods)
periods)
7954 dollars)
106.5
30, 367
114.1
30, 482
0.4
120.5
28, 106
5. 6
-7.8
181. 8f
124.8
,
20, 997
-25.3
130.1
3.6
-28." 4J
126.4
18,326
138. 5
33." 2*
128. 1
2.6
18,390
173.3
-12.Y
18.8
132. 5
3.4
17,869
— 2. 8
205.8
133.9
1.1
17,916
.3
317.9
139. 9
18,025
282. 5
146.7
18, 513
293.1
-7.8
149.3
18, 686
292.7
9.' 6
151.9
18,960
318.1
154.0
19,134
341.8
156.4
19,323
4.4
353. 5
20. 6'
159.0
19, 609
369. 0
6*6
161.9
,
. .. .
19.950
363.1
165.1
.
20, 428
392.7
168.1
21,002
402. 2
8.'7'
13.8
171.2
21,559
407. 0
" ' 7." 5
174.1
22, 139
401.3
177.1
,
22, 894
428. 6
180.0
23, 716
440.2
12. 9
9.4
183. 1
24. 537
447.9
7.1
185.9
25. 518
476.8
188.1
26, 793
492. 6
191.3
28, 098
516.0
6.3
18.5
17.2

•Excludes offices in territories.
11929.
£1929-32.
Sources: Banking offices—Office of the Comptroller of the Currency, Annual Report, various years, and Board of Governors of
of the Federal Reserve System, Federal Reserve Bulletin, various issues. Gross national product—Department of Commerce, Survey
of Current Business, various issues. Population—Department of Commerce, Statistical Abstract of the United States, various years.




17

TABLE 3.—Commercial banks and branches, by States
1919\
Banks

Branches

Total

81
704

102
883

0
16
4

134
55
48

208
115
234
33

0
32
59
0

523

...

21
179

134
39
44

9
12
30

1,083
153
59
51

208
147
293
33

64
69
179
10

26
57
75
5

90
126
254
15

46

569

243

68

104
26
126
60
75
199

30
33
20
10
12
31

311

1
14
15

266
47
436
125
86
378

397

3,810

Total

35

134
59
146
70
87
230

1,667

1,236

2,903

— 51.2

Percent change for group from previous date
Limited Branching:
Alabama
Georgia
Indiana
Kentucky
Louisiana
Massachusetts
Michigan
Mississippi
New Jersey
New Mexico
New York
Ohio
Pennsylvania
South Dakota
Tennessee
Virginia
Wisconsin

Total

18
800

3,413

Total

Branches

144
47
21

265
33
421
125
86
368

. .

Banks

17
283

ooo

Statewide Branching:
Alaska f
Arizona
California
Connecticut
Delaware
District of Columbia
Hawaii!
Idaho
M!aine
Maryland
Nevada
North Carolina
Oregon
Rhode Island
South Carolina
Utah
Vermont
Washington

1934

211.3

—23.8

334
720

Total
Percent change for group from previous date

554
469
200

45

277

633
303
360
113

218
24
21
5

216

105

321

435
216
398
43

134
35
113
0

229
106
36
0

851
327
381
118
1,109
1,253
1,504

797
685

1,105

655

212

616
166
91
1

569
251
511
43
1 413

31
20
9

550
468
947

329
328
636

46
69
94

10, 608

873

11,481

1,147
1,468

851

1,196
213

375
397
730

462
371
253

....

1,376
1,676
1,304
1,446
1,546
418

.

...

1,146
69
882

0
0
0
2

1
0

335
148

0
0
0
0

13,807

11

925

. ...

6
0
2
0
0
0

1,450

468
371
255

1,376
1,676
1,304
1,446
1,546
418

1,148
70
882
925

1,450
335
148

13,818

7,045

1,628

8,673

— 33.6

.

Percent change for group from previous date
Unit Banking:
Arkansas
Colorado
Florida
.
Illinois
Iowa
Kansas.
.
Minnesota . .
Missouri
M!ontana
Nebraska
New Hampshire
North Dakota
Oklahoma
Texas
West Virginia
Wyoming

233
347

39
25
53

519
448
938

....

16
25

515
444
147

655

.

217
322

1,032
576
334

880

. . .

354
745

3
1
80

232

. . .

20
25

1,029
575
254

86.5

-24.5

230
160
155
878
622
752

5
0
0
0
95
0

235
160
155
878
717
752

690
702

6
0

696
702

65
210

1
0

416
957
181
63

0
0
0
0

125
435

0
2

125
437

66
210
416
957
181
63

6,641

109

6,750

-51.9

890.9

-51.2

1,281
29,109
15,353
2,973
18,326
27, 828
Total United States
132.1
—44.8
— 37.0
Percent change for group from previous date
*Branch law classification used is that which appeared in The National Banking Review, 1, March 1964, p. 341. The basis foi
classification was pragmatic, rather than statutory.
fBranches are as of 1920.
{Included after admission as States.

18




grouped by branch lavu^ selected years; 1919—64
1946
Banks

Branches

1960

1950
Total

Banks

Branches

Total

Banks

Branches

1964
Total

Banks

Branches

Total

13
10
117
70
20
12
12
32
47
133
7
183
51
9
145
50
56
87

27
173
1,636
197
53
90
81
82
129
237
35
504
194
89
141
70
33
283

40
183
1,753
267
73
102
93
114
176
370
42
687
245
98
286
120
89
370

12
16
200
66
20
15
12
24
46
121
8
152
51
10
133
55
49
97

46
241
2,232
285
63
81
109
119
160
355
56
707
249
110
237
100
50
373

58
257
2,432
351
83
96
121
143
206
476
64
859
300
120
370
155
99
470

3,384

1,054

4,054

5,108

1,087

5,573

6,660

10.6

-22.6

100.5

50.9

3.1

37.5

30.4

238
421
443
355
190
171
380
193
253
55
402
585
703
174
297
305
561

82
97
307
144
173
370
575
132
430
52
1,368
635
784
59
210
265
158

320
518
750
499
363
541
955
325
683
107
1,770
1,220
1,487
233
507
570
719

252
431
431
348
209
159
361
196
236
63
354
547
591
173
294
277
578

135
159
437
214
231
523
804
188
621
80
1,802
869
1,139
72
290
466
168

387
590
868
562
440
682
1,165
384
857
143
2,156
1,416
1,730
245
584
743
746

10
207
123
39
20

35
880
20
14
35

45
1,087
143
53
55

11
202
112
38
19

56
979
50
20
45

61
1,181
162
58
64

47
64
170
8
227
70
23
149
59
72
122

42
68
94
17
161
75
44
30
12
9
115

89
132
264
25
388
145
67
179
71
81
237

43
63
164
8
225
70
16
148
55
70
118

55
71
119
19
218
102
60
49
24
11
144

98
134
283
27
443
172
76
197
79
81
262

1,410

1,651

3,061

1,362

2,022

5.4

-3.4

22.5

— 15.4

33.6 j

219
316
489
390
155
187
434
203
348
44
672
674
1,016
169
294
315
554

23
30
83
34
62
143
198
52
133
6
694
176
124
44
68
86
145

242
346
572
424
217
330
632
255
481
50
1,366
850
1,140
213
362
401
699

225
397
487
385
165
182
442
201
324
51
629
659
971
169
297
313
554

26
42
109
44
77
177
239
68
165
15
786
226
193
49
98
114
152

251
439
596
429
242
359
681
269
489
66
1,415
885
1,164
218
395
427
706

6, 479

2, 101

8, 580

6,451

2,580

9,031

5,726

5,841

11,567

5,500

8,198

13,698

— 8.0

29.1

-1.1

-0.4

22.8

5.3

-11.2

126.4

28.1

— 3.9

40.4

18.4

239
143
187
874
810
615
683
596
110
411
66
176
384
855
180
55

232
154
199
891
663
612
680
600
110
418
75
150
386
908
180
53

19
4
6
2
164
0
6
1
0
2
2
22
1
5
0
0

251
158
205
893
827
612
686
601
110
420
77
172
387
913
180
53

237
192
309
966
673
587
689
626
121
426
74
156
389
1,011
182
55

45
1
0
0
183
22
6
23
0
11
3
28
18
8
0
0

282
193
309
966
856
609
695
649
121
437
77
184
407
1,019
182
55

245
246
424
1,030
675
594
720
643
129
432
73
163
417
1,130
184
68

88
1
0
0
221
47
9
53
1
25
19
42
30
31
0
0

333
247
424
1,030
896
641
729
696
130
457
92
205
447
1,161
184
68

219
142
184
871
649
614
677
596
110
409
64
151
383
851
180
55

20 1
1
3
3
161
1 i
6
0
0
2
2
25
1
4
0
0

6,155

229

6,384

6,311

234

6,545

6, 693

348

7, 041

7, 173

567

7,740

— 7.3

110. 1

-5.4

2. 5

2.2

2.5

6. 1

48.7

7.6

7.2

62.9

9.9

14, 044
3,981
18,025
14,124
4,836
18,960
14, 338
13.473
10,243
23,716
13,760
28, 098
— 8.5
33.9
-1.6
0.6
5.2
2.1
40.0
-4.6
111.8
25. 1
18.5
21.5
Sources: Office of the Comptroller of the Currency, Annual Report, various years; Board of Governors of the Federal Reserve
System, Banking and Monetary Statistics, 1943; Board of Governors of the Federal Reserve System, Federal Reserve Bulletin,
various issues.




19

TABLE 4.—Number of newly organized commercial banks
in the United States, by class of bank, 7947-64
National

Tear
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960

17
15

State

Total

92
65

11
7
9
15
16
16

60
61
53
58
52
55

28

88

109
80
71

68
62
73

68
71
116

30
20

123
87

78
94
103

96
118
137

260

1,019

1, 279

26
65
164
205

Total, 1947-60
1961
1962
1963
1964

93
67

18
24
34

86
120
136
136

112
185
300
341

Total, 1961-64

460

478

938

Total, 1947-64

720

1,497

2,217

Source: The National Banking Review, 2, March, 1965, p. 306.

TABLE 5.—Commercial banks and branches in the United States,* by class of bank, 1960-64
State banks

National banks

Tear
Number
Percent Number
Percent
of banks change in
of
change in
branches branches
banks

1960
1961
1962
1963...
1964

4 529
4,512
4,504
4,614
4,772

-0.38
— .18
2.44
3.42

5,325
5,855
6,445
7,209
7,957

9.95
10.08
11.85
10.38

Total
offices

9,854
10,367
10,949
11,823
12,729

Percent
Number
Percent Number
of
change in
of banks change in
branches branches
banks

8.944
8^920 "— 6.27
8,924
.04
8,954
.34
8,988
.38

4,918
5.250 '"e.is
5:645
7.52
6,016
6.57
6; 381
6.07

Total
offices

13,862
14,170
14, 569
14, 970
15, 369

Total
offices
National
and
State
banks

23, 716
24, 537
25,518
26, 793
28, 098

*Banks and banking offices in territories excluded.
Sources: The National Banking Review, 2, March 1965. Office of the Comptroller of the Currency, Annual Report, various
years, and Board of Governors of the Federal Reserve System, Federal Reserve Bulletin, various issues.

20




TABLE 6.—Number of newly organized commercial hanks and total commercial banks, * by State groups classified by branch law,
1952-64
Statewide branchbanking

Limited branch banking

Unit banking

All States

Tear
Total
banks

1952
19^3
1954 .
1953
1956
195"
1958
195) .
196u
1961
1902
196 }

1,342
1,334
1,257
1,202
1,161
1,119
1,090
.083
1,054
,041
022
1,037
1, 087

New
banks

New as
percent
total

16
18
9
22
12
15
9
17
14
22

1.19
1.35
0.72
1.83
1.03
1.34
.83
1.57
1.33
2 12
2. 74
5.40
6. 90

•>R

56
75

Total
banks

6,367
6,300
6,204
6,090
5,995
5,927
5, 845
5,761
5, 726
5, 660
5, 575
5,524
5', 500

New
banks

New as
percent
total

Total
banks

New
banks

New as
percent
total

22
21
18
31
33
24
25
23
39
34
44
57
79

.35
.33
.29
.51
.55
.40
.43
.40
.68
.60
.79
1.03
1.44

6,340
6,350
6,378
6,423
6,486
6,521
6,567
6,632
6,693
6, 731
6,831
7,007
7,173

35
29
44
63
78
48
62
78
84
56
113
187
187

.55
.46
.69
.98
1.20
.74
.94
1.18
1.26
.83
1.65
2.67
2.61

Total
banks

New
banks

14, 049
13,984
13,839
13,715
13,642
13,567
13, 502
13,476
13,473
13,432
13,428
13, 568
13,760

73
68
71
116
123
87
96
118
137
112
185
300
341

New as
percent
total
.52
.49
.51
.85
.90
.64
.71
.88
1.02
.83
1.38
2.21
2.48

*Banks in territories are excluded.
Sources: New bank data—77t« National Banking Review, 2, March 1965, p. 350. Total bank data—Office of the Comptroller
of the Currency, Annual Report, various years, and Board of Governors of the Federal Reserve System, Federal Reserve Bulletin,
various issues.




21

T A B L E 7.—Commercial banking offices,population

and personal income by State groups classified by branch law, * 7934—64

Percent
change
193546

Percent
change 1955
194750

Percent
change
195155

Percent
change
195660

Percent
change
196164

Item

1934

1946

Commercial banking offices:
Statewide branch banking f.
Limited branch banking. . .
Unit banking

2,903
8,673
6,750

3,061
5.4
8,580 — 1.1
6,384 — 5.4

3,384
9,031
6,545

10.6
5.3
2.5

3,875
9,909
6,644

14.5
9.7
1.5

5,108
11,567
7,041

31.8
16.7
6.0

6,660
13,698
7,740

30.4
18.4
9.9

18, 326

18, 025 - 1 . 6

18,960

5.2

20, 428

7.7

23,716

16.1

28, 098

18.5

28, 494
73,182
38,216

30, 466
79,108
41,668

6.9
8.1
9.0

34,811
84, 686
44, 810

14.3
7.1
7.5

40, 596
90, 566
48, 824

16.6
6.9
9.0

43, 771
95,101
51,490

7.8
5.0
5.5

10.7 151,242

8.1

164,307

8.6

179,986

9.5

190,362

5.8

All State total

Population (thousands):
Statewide branch banking f. 21, 279
Limited branch banking. . . 68, 399
36, 694
Unit banking
All State total

126, 372 139, 892

Personal income (millions of
current dollars):
9,970
Statewide branch banking!.
Limited branch banking. . . 30, 885
Unit banking
12, 627
All State total

33.9
7.0
4.1

1950

1960

1964

39, 047 291.6 47, 853
91, 974 197.8 118,222
45, 395 259.5 59, 368

22.6 68, 758
28.5 159,289
30.8 78, 581

43.7 95, 441
34.7 200, 679
32.4 102, 944

38.8
26.0
31.0

121,644
242,051
124,150

27.5
20.6
20.6

53, 482 176,416 229.9 225, 443

27.8 306, 628

36.0 399, 064

30.1

487, 845

22.2

Real disposable personal income (millions of 1954-dollars):
Statewide branch banking %.
Limited branch banking. . .
Unit banking
All State total

44, 589
106, 346
54, 298

48, 520
119,074
60,136

8.8 60, 321
12.0 140, 069
10.8 69, 769

24.3 72, 991
17.6 158,886
16.0 82, 485

21.0
13.4
18.2

§84, 208
§174,989
§91, 994

A15.4
A10.1
AH.5

205, 233

227, 730

11.0 270,159

18.6 314, 362

16.4

§351,191

All. 7

•Branch law classification used is that which appeared in The National Banking Review, 1, March 1964, p. 341. The basis
for classification was pragmatic, rather than statutory.
f Alaska and Hawaii excluded until admission as States.
JAlaska and Hawaii excluded.
§1963 data.
A1960-63.
Sources: Banking office data—Office of the Comptroller of the Currency, Annual Report, various years. Board of Governors
of the Federal Reserve System, Federal Reserve Bulletin, various issues. Board of Governors of the Federal Reserve System, Banking
and Monetary Statistics, 1943.
Population and personal income data—Department of Commerce, Statistical Abstract of the United States, various years.
Disposable personal income data—Department of Commerce, Survey of Current Business, April 1965.

22




TABLE

8—Mere

under the Bank Merger Act, 1960, in which the resulting institution was a National Bank> classified
by size of acquiring and acquired banks, through June 30, 1965
Acquired banks

Acquiring bank\
Assets less
than $10
million
Assets
Assets
Assets
Assets
Assets

less than $10 million
$10 million to $24.9 million
$25 million to $49.9 million
$50 million to $99.9 million
$100 million or over

Assets $25
Assets $10
Assets $50
million to
million to
million to
$24.9 million $49.9 million $99.9 million

Assets $100
million or
over

Total

49
63
52
54
99

4
7
24

1
13

8'

49
69
70
81
204

317

Total

6
14
19
60
99

35

14

8

J473

*Includes all forms of acquisition.
fFor this classification, the bank with the larger total assets in each transaction was considered to be the acquiring bank.
J459 transactions were included. Since 6 of these involved 3 banks and 4 involved four banks, 473 banks were absorbed in the
459 transactions.

TABLE 9.—U.S. Commercial bank failures * 1952-65
Number of bank failures

Bank failure rate per
10,000 banks

Tear
State
insured

National

State
noninsured

Total

National

1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965 (6 months)

0
0
0
2
1
0
1
0
0
2
0
0
1
2

3
2
2
3
1
1
3
3
1
3
0
2
6
3

1
1
2
0
1
1
5
0
1
4
2
0
1
1

4
3
4
5
3
2
9
3
2
9
2
2
8
6

Total

9

33

20

State
insured

Business
failure rate
per 10,000
firms

62

0
0
0
4.3
2.2
0
2.2
0
0
4.4
0
0
2.1

3.5
2.3
2.3
3.5
1.2
1.2
3.5
3.5
1.2
3.5
0
2.3
6.9

28.7
33.2
42.0
41.6
48.0
51.7
55.9
51.8
57.0
64.4
60.8
56.3
53.2

*For insured banks, the figures show the number of cases requiring FDIG disbursements. For noninsured banks, the figures
show the number of cases described by the FDIG as "noninsured bank failures."
Sources: Federal Deposit Insurance Corporation, Annual Report, 1952 through 1963, for bank data for those years. Bank
data for 1964 and 1965 from FDIG, Report to the Comptroller of the Currency of Liquidation and Insurance Expenses, November30,
1964, and supplement. Business failure data from Economic Report of the President, 1965.




23

ANNUAL REPORT, 1964




INDEX
Statistical Tables
Table No.

Title

1 Number of commercial banks, and banking offices,
and total assets, by class of bank, end of 1963 and
1964, and percent change 1963-64
2 Total assets of commercial banks, mutual savings
banks, savings and loan associations, and credit
unions; end of December 1962, 1963, and 1964,
and percent change 1963-64
3 Assets and liabilities of national banks on December
20, 1963; December 31, 1964; and percent change
December 1963 to December 1964
4 Percent distribution of assets, and liabilities, of national banks, December 1963 and 1964
5 Demand and time deposits; dollar amount, and percent distribution, by type of bank, December 1963
and 1964
6 Number of national banks and banking offices, by
States, December 31, 1964
7 National bank charter applications, and charters
issued, by States, January 1-December 31, 1964;
received, approved, rejected, abandoned, and
pending as of December 31, 1964
8 Charters, liquidations, and capital stock changes
of national banks, calendar 1964

26




Page

27

28
29
30
31
32

33
34

Table No.

Title

9 Branches of national banks: in operation December
31, 1963; opened for business, discontinued, or
consolidated, January 1—December 31, 1964; and
branches in operation December 31, 1964
10 Branches of national banks opened for business, by
community size and size of banks, October 1December 31, 1964, and calendar 1964
11 De novo branch applications of national banks, by
States, January 1-December 31, 1964; received,
approved, rejected, abandoned, and pending as
of December 31, 1964
12 Current operating revenue, expenses, and dividends
of national banks, December 1963 and 1964, and
dollar and percent changes, 1963-64
13 Statement of comparative assessment and other
operating income, and expenses of the Office of
the Comptroller of the Currency, by calendar
years 1958 through 1964
14 Comparative statement of financial operations of the
Office of the Comptroller of the Currency, by
calendar years 1958 through 1964

Page

35

36

37

38

55

56

I. State of the National Banking System
During 1964, the assets of national banks rose by
almost $20 billion, or 11.7 percent. On December 31,
1964, the 4,615 national banks had total assets of
$190.1 billion.
As can be seen in table 1, the 1964 rate of increase
in assets was greater for national banks than for either
State member or insured nonmember banks. In 1962
and 1963, the assets of insured nonmember banks rose
at a faster rate than did the assets of national banks.
In 1964, the first time in 3 years, the assets of national
banks rose by more than the assets of savings and loan
associations. Credit unions continued to expand at
a faster rate than national banks or commercial banks;
this was also true in 1962 and 1963.
To some extent, these asset changes reflect the increase in the number of national banks and banking
offices. In December 1964, there were 4,780 commercial banks under the supervision of the Comptroller of
the Currency, including 7 nonnational banks in the
District of Columbia. This represents a 3.4 percent
increase since the end of 1963. During 1963, the comparable increase was 2.4 percent and, in 1962, there
was a decline of 0.2 percent. The number of State

member banks declined by 3 percent in 1964, continuing the decline of the last 5 years. The number of
insured nonmember banks continued to rise in 1964
at about the same rate as in 1962 and 1963. During
1964, the number of national banking offices (the sum
of national banks and branches of national banks, including the banks in the District of Columbia) increased by 7.6 percent, less than the 8.2 percent rise
experienced in 1963, but more than the 5.5 percent rise
of 1962. As in 1962 and 1963, the percentage increase in banking offices under the supervision of the
Comptroller of the Currency was greater than for either
State member or insured nonmember banks.
In evaluating the growth of the commercial banking system during 1964, it should be noted that the
economy experienced a 6.6 percent rise in gross national product (in current dollars), a 12 percent
growth in corporate profits before taxes, and a 5.9 percent gain in personal income. A significant factor accounting for this growth of the economy was a 4.3 percent increase in the money supply—an increase greater
than in 1961, 1962, or 1963.

TABLE 1.—Number of commercial banks, and banking offices, and total assets, by class of bank, end of 1963
and 1964, and percent change 1963-64
[Dollar amounts in billions]
Number of banking offices

j\'umber of banks
Percent
change
7963-64

7963

All commercial banks. , .
National banks l
.
State member banks
Insured nonmember banks
Noninsured banks
1

7964

13,566

13,771

1.51

4,622
1,493
7,177
274

4,780
1,448
7,266
277

3.42
-3.01
1.24
1.09

7963

7964

Percent
change
7963-64

Value of assets

7963

7964

Percent
change
7963-64

26, 905 28,231

4.93

$314.1

$348. 4

10.92

12,754
4,695
10,448
334

7.55
1.36
3.61
1.21

171.2
90.5
50.1
2.3

191.2
98.1
55.8
3.3

11.68
8.40
11.38
43.48

11,859
4,632
10,084
330

Includes 7 nonnational banks in the District of Columbia.




27

TABLE 2.—Total assets of commercial banks, mutual savings banks, savings and loan associations, and credit
unions; end of December 1962, 1963, and 1964, and percent change 1963-64
[Dollar amounts in millions]
Dec. 28, 1962

Dec. 20, 1963

Dec. 31, 1964

Percent increase

7963-64

Commercial banks
Mutual savings banks
Savings and loan associations
Credit unions
1

$298,196
46,121
93, 605
7,188

$314, 056
49, 702
107, 559
8,128

$348, 433
54, 240
119,295
9,303*

10.95
9.13
10.91
14.461

Based on preliminary December 1964 data.

II. Assets, Deposits, and Capital Accounts
The assets of national banks grew 11.7 percent during 1964. Their earning assets (loans, securities, Federal funds sold, and direct lease financing) registered
a 10.1 percent increase over 1963, but these assets as a
proportion of total assets declined from 80.5 percent
at the end of 1963 to 79.3 percent at the end of 1964.
Loans and discounts increased 14.6 percent (see table
3) while total securities displayed a modest 4.2 percent increase. As a percentage of total assets, loans
and discounts increased from 49.0 percent in 1963 to
50.3 percent in 1964, but securities dropped from 30.6
percent in 1963 to 28.6 percent in 1964. Holdings of
direct U.S. Government obligations by national banks
increased 0.4 percent, reversing the decline of 6.3 percent in 1963. However, the relationship of these holdings to total assets fell from 19.6 percent in 1963 to 17.6
percent in 1964. State and local obligations increased
13.5 percent over 1963, less than the 20.4 percent increase experienced in 1963 period. As a percentage of
total assets, State and local obligations rose slightly
from 9.6 percent in 1963 to 9.8 percent in 1964. This
increase of loans and discounts, as contrasted with the
relative decrease in securities holdings, reflects the
brisk demand for loans from the private sector of
our economy.
State member banks had an 8.8 percent increase in
loans in 1964—the same rate of increase they experienced in 1963. Securities holdings of State member banks increased 1.1 percent in 1964. Their
holdings of direct U.S. Government obligations de-

28




clined 4.0 percent—less than the 7.8 percent decrease
in 1963. Holdings of State and local government obligations increased 10.8 percent—less than the 23.3
percent increase experienced in 1963.
Loan deposit ratios of national banks rose from 30.0
percent in 1936 to 37.5 in 1954 and continued to rise
to 55.3 in 1963 and 56.3 in 1964. This ratio for State
member banks fell slightly from 59.7 in 1963 to 59.2 in
1964.
Deposits of national banks increased by $18.8 billion
in 1964, a 12.5 percent rise. The growth of time and
savings deposits ($9.5 billion, or 15.5 percent) exceeded that of demand deposits ($9.3 billion, or 10.4
percent) for 1964, thus continuing past trends in deposit distribution. Demand deposits fell from 59.3
percent of total deposits at the end of 1963 to 58.2
percent at the end of 1964, while time and savings
deposits rose from 40.7 percent in 1963 to 41.8 percent
in 1964.
Total capital of national banks increased by $1.5
billion or 11.1 percent during 1964. There was a
sharp increase in the use of debenture financing during
1964, with a rise in the amount outstanding from $45
million to $475 million. Undivided profits, surplus,
and common capital increased from their 1963 levels
by 5.1, 7.6, and 8.3 percent, respectively. At the end
of 1964, total capital was 7.92 percent of total liabilities and capital, approximately the same as last year's
7.96 percent.

TABLE 3.—Assets and liabilities of national banks on Dec. 20, 1963; Dec. 31, 1964; and percent change
December 1963 to December 1964
[Dollar amounts in millions]
Dec. 20, 1963 Dec. 37, 1964
Percent change
1963 to 1964
4,675 banks

Loans and discounts (including overdrafts)
U.S. Government securities, direct obligations
Obligations guaranteed by U.S. Government
Obligations of States and political subdivisions
Other bonds, notes, and debentures

4,773 banks

Total deposits.
Demand deposits
Time and savings deposits
Rediscounts and other liabilities for borrowed money
Federal funds purchased
Acceptances executed by or for account of reporting banks and outstanding
Other liabilities
Total liabilities.

149, 943

1,457
24

821
81

-43.65
237. 50

28, 635

34, 066

18.97

2,591
575
1,388

2,789
652
1,760

7.64
13.39
26.80

190,113

11.68

67, 740
56, 606
3,874
11,523
9,009
2,072

74, 200
64, 763
3,787
13, 647
10, 733
2,486

9.54
14.41
-2.25
18.43
19.14
19.98

169,617

12.46

89, 389
61,434
395
1,309
584
3,569

98, 660
70, 957
299
827
666
3,656

10.37
15.50
-24.30
-36.82
14.04
2.44

156,681

Demand deposits of individuals, partnerships, and corporations
Time and savings deposits of individuals, partnerships, and corporations
Postal savings deposits
Deposits of U.S. Government
Deposits of States and political subdivisions
Deposits of banks
Certified and officers' checks, etc

135,560

150,823

Total assets.

$95, 577
33, 448
89
18,592
2,237

170,229

Total loans and securities. . . .
Federal funds sold
Direct lease
financing
,
Reserve with Federal Reserve bank
Currency and coin
Balances with other banks, and cash items in process of collection
Fixed assets
Customers' liability on acceptances outstanding
Other assets

$83, 388
33,311
73
16,380
2,408

175, 065

11.73

45
3,959
25
6,700
2,529
290

475
4,286
28
7,207
2,657
393

955. 56
8.26
12.00
7.57
5.06
35.52

14.62
.41
21.92
13.50
-7.10
10.61

CAPITAL ACCOUNTS

Debentures
Common stock
Preferred stock
Surplus
Undivided profits
Reserves and retirement account for preferred stock. . . .
Total capital accounts
Total liabilities and capital accounts.




13,548

15,048

11.07

170,229

190,113

11.68

29

TABLE 4.—Percent distribution

of assets, and liabilities, of national banks, December 1963 and 1964
December
1963

December
7964

ASSETS

Securities:
U.S. Government, direct and guaranteed
Obligations of States and political subdivisions
Other bonds and securities

Percent
19.61
9.62
1.41

Percent

17.64
9.78
1.18

30.65
48.99
.86
.01
10.37
6.45
1.52
1.15

28.60
50.27

100. 00

100.00

39.79
33.25
2.27
6.77
5.29
1.22

39.03
34.07
1.99
7.18
5.65
1.31

Total deposits

88.60

89.22

Demand deposits.
Time deposits. .. .

52.51
36.09

51.90
37.32

Total securities
Loans and discounts
Federal funds sold
Direct lease financing
Cash and balances with other banks, excluding reserves.
Reserve with Reserve banks
Fixed assets
All other assets
Total assets.

.43
.04

11.96
5.95
1.47
1.27

LIABILITIES

Deposits:
Demand of individuals, partnerships, and corporations.
Time of individuals, partnerships, and corporations
U.S. Government
States and political subdivisions
Banks
Other deposits (including postal savings)

Other liabilities
Capital funds:
Debentures
Capital stock
Surplus
Undivided profits and reserves.
Total capital accounts
Total liabilities and capital accounts.

30




3.44
.03
2.34
3.94
1.66

2.87
.25

2.27
3.79
1.60

7.96

7.92

100. 00

100. 00

Demand

af;.i nine deposits; dollar amount, and percent distribution,
December 1963 and 1964

by type of bank,

[Dollar amounts in millions]
December 1964

December 7963
Dollar amount

All commercial banks:
Total deposits
Demand
Time

Dollar amount

Percent
distribution

$276,230

58.4
41.6

229, 376

100. 0

255, 724

100.0

60. 2
39. 8

151,384
104,340

59.2
40.8

100.0

169,617

100.0

89, 389
61, 434

59.3
40.7

98, 660
70, 957

58.2
41.8

78, 553

Demand
Time

100.0

180, 199
128,228

150,823

.. .

$308, 427

59. 4
40. 6

138,064
91,312

Demand
Time, ,

100. 0

164,050
112,180

Members of Federal Reserve System:
Total deposits

National banks:
Total deposits
Demand
Time.
State member banks:
Total deposits
Demand
Time
Insured nonmember banks:
Total deposits
Demand .
Time.
Noninsured banks:
Total deposits

Percent
distribution

100.0

86, 108

100.0

48, 675
29, 878

62.0
38.0

52, 725
33, 383

61.2
38.8

45, 270

100.0

50, 507

100.0

24, 887
20, 383

55.0
45.0

27, 308
23, 199

54. 1
45.9

1,583

100.0

2,197

100.0

1,098
485

69.4
30.6

1,508
689

68.6
31.4

I I I . New Charters, Branches and Mergers
There were 232 national bank charters issued in
1964, including two for Deposit Insurance Corporation
National Banks organized under section 11 of the
Federal Deposit Insurance Act. Of these charters,
27 represented conversions of State-chartered banks,
an increase of one from 1963. Five States (California,
38; Colorado, 11; Florida, 23; Oklahoma, 11; and
Texas, 24) accounted for 52.7 percent of all primary
national bank charters issued. No primary national
bank charters were issued in 15 States.
At the end of 1964, there were 7,960 national bank
branches, an increase of 782 over December 31, 1963.
Pennsylvania and California experienced the greatest
net additions of branch offices—105 and 98, respec-




tively. Other States with substantial net increases in
branches were: New York (66), Michigan (52), New
Jersey (46), Ohio (38), Massachusetts (32), Virginia (32), Washington (28), Indiana (26), and
Connecticut (20).
Of the 782 national bank branches opened in 1964,
474, or 60.6 percent, were located in communities with
a population of less than 25,000. National banks with
total resources of less than $25 million opened 239
branches, or 30.6 percent of the total.
During 1964, the Comptroller of the Currency approved 91 consolidations, mergers, and absorptions involving national banks, as compared with 90 in 1963.
31

TABLE 6.—Number of national banks and banking offices, by States, Dec. 31,1964
National banks
State

Number of
Number of
branches of national bankWith branches national banks ing 1 offices

Unit

Total
United States 2

4,773

3,537

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands

,

80
5
4
63
90
115
27
5
8
187
55
2
9
410
124
101
169
82
47
22
49
93
96
193
31
91
48
125
3
50
146
33
203
31
41
221
222
11
387
4
25
33
75
3
539
12
28
M23
28
79
109
38
1

56
0
1
40
57
115
12
4
1
187
32
0
4
410
63
80
145
43
17
8
24
34
44
191
8
77
48
109
1
35
52
15
110
9
36
102
199
6
242
0
6
28
32
539
8
19
61
13
79
97
38
0

District of Columbia—all5

15

,

1
Number of banking offices is the sum of total national banks
and number of branches of national banks.
2
Includes Virgin Islands.
3
Includes Deposit Insurance National Bank of Dell City,
Dell City, Tex.—organized under Section 11 of the Federal
Deposit Insurance Act—to operate no longer than for a 2-year
period.

32




7,960

12,733

24
5
3
23
33
0
15
1
7
0
23
2
5
0
61
21
24
39
30
14
25
59
52
2
23
14
0
16
2
15
94
18
93
22
5
119
23
5
145
4
19
5
43
0
4
9
62
15
0
12
0
1

106
38
166
47
1,648
0
152
3
45
0
100
39
90
0
244
23
24
110
126
62
171
303
355
6
42
14
0
16
30
17
390
46
755
248
5
465
23
199
724
52
161
34
179
0
53
27
274
322
0
24
0
2

186
43
170
110
1,738
115
179
8
53
187
155
41
99
410
368
124
193
192
173
84
220
396
451
199
73
105
48
141
33
67
536
79
958
279
46
686
245
210
1,111
56
186
67
254
539
65
55
397
350
79
133
38
3

13

78

93

1,236

4
Includes Deposit Insurance National Bank of Newport News,
Newport News, Va.—organized under Section 11 of the Federal
Deposit Insurance Act—to operate no longer than for a 2-year
period.
5
Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of
the Currency.

TABLE 7.—National hank charier applications,1 and charters issued,1 by States, Jan. I—Dec. 31, 1964; received,
approved, rejected, abandoned, and pending as of Dec. 31,1964
State

United States 3
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut....
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee.
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands
Puerto Rico
1
2

Received 2

Abandoned

Rejected

Pending
Dec. 31, 1964

Charters
Issued

538

185

242

30

81

232

16
0
0
9
105
29
12
0
3
70
9
2
0
21
2
3
4
0
4
0
6
4
12
9
6
22
7
4
6
1
14
5
12
0
3
12
29
1
3
0
4
1
3
46
5
0
7
10
3
4
9
0
1

10
0
0
3
30
9
3
0
1
15
2
0
0
12
2
1
1
0
1
0
2
2
7
1
4
9
2
3
0
1
10
3
4
0
2
7
2
1
1
0
0
0
1
11
2
0
3
6
2
4
5
0
0

5

0
0
0
1

8
0
1
3
38
11
4
0
1
26
1
0
0
9
1
1
2
0
3
0
4
1
8
4
2
9
1
4
0
0
7
4

2
0
0
0
0

1
0
0
3
18
1
6
0
0
7
0
2
0
3
0
2
0
0
0
0
2
2
4
1
1
3
1
0
1
0
1
1
2
0
0
4
2
0
0
0
0

0

0

0
1
0
0
1
0
0
0
0
0
0

2
6
1
0
0
0
0
0
3
0
1

Includes conversions.
Includes applications pending as of Dec. 31, 1963.




Approved

3
4

0
0
2
52
19
3
0
1
38
5
0
0

5

0

o
3
0
3
0
2
0
1
5
1
8
4
1
4
0
3
1
6
0
0
1
23
0
2
0
4
1
0
28
2
0
3
4
1
0
1
0
0

5

0
0
0
1
10
2
0
0
1
0

o

0
0

o
0
0
0
0
2
0
2
0
0
1
0
o
0
0
0
1

o

5

0
3
4
11
0
2
0
0
0
1
* 25
2
0
49
5
3
5
4
0
0

Includes Virgin Islands and Puerto Rico.
Includes one Deposit Insurance Corporation national bank.

33

TABLE 8.—Charters, liquidations, and capital stock changes of national banks, calendar 1964
Capital stock
Item

Number of
banks

Capital notes
and debentures
Common

Increases:
Banks newly chartered:
Primary organizations
Reorganizations
Conversions of State banks
Capital stock:
Preferred: 2 cases by new issues
Common:
203 cases by statutory sale
587 cases by statutory stock dividend
7 cases by statutory consolidation
54 cases by statutory merger
Capital notes and debentures: 27 cases by new issue
Total increases
Decreases:
Banks ceasing operations:
Voluntary liquidations:
Succeeded by national banks
Succeeded by State banks
No successor
Statutory consolidations
Statutory mergers
Conversions into State banks
Merged or consolidated with State banks (Public Law
706)
Receivership
Capital stock:
Preferred: 3 cases by retirement
Common:
1 case by statutory reduction
10 cases by statutory merger
Capital notes and debentures: 1 case by retirement

*205
0
27

Preferred

$87, 212, 260
0
52, 425, 023

0
0
0

0
0
$25, 000, 000

0

0

$3,200, 000

0

0
0
0
0
0

23, 680, 081
153,926,577
7, 097, 250
13,593,275
0

0
0
0
0
0

0
0
0
0
405,014,100

232

337, 934, 466

3,200, 000

430,014,100

9
1
1
4
39
6

1,560,000
1,250,000
150,000
0
0
1,100, 000

0
0
0
0
0
0

0
0
0
0
0
0

15
1

4, 950, 800
100, 000

0
0

0
0

0

0

39,140

0

0
0
0

50, 000
1, 386, 363
0

0
0
0

0
0
100,000

76

10, 547,163

39,140

100, 000

Net change
Charters in force Dec. 31, 1963, and authorized capital stock . .

154
4,625

327, 387, 303
3, 964, 436, 146

3, 160, 860
25,195,470

429, 914, 100
45, 300, 000

Charters in force Dec. 31, 1964, and authorized capital stock. .

4,779

4, 291, 823, 449

28, 356, 330

475,214,100

Total decreases

1

Includes 2 Deposit Insurance National Banks organized under sec. II of the Federal Deposit Insurance Act.

34




TABLE 9.—Branches of national banks: in operation Dec. 31, 1963; opened for business, discontinued, or
consolidated, Jan. 1-Dec. 31, 1964; and branches in operation Dec. 31, 1964
State

United States *
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee.
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands
District of Columbia—all3.
1
2
3

Includes Virgin Islands.
Revised from 1963 Annual Report.
Includes national and nonnational banks in the District of




Branches in
operation
Dec. 31, 1963

Branches opened
for business
Jan. 1-Dec. 31,
1964

Existing branches Branches in
discontinued or
operation
consolidated Jan. Dec. 31, 1964
1-Dec. 31, 1964

2 7, 228

782

50

7,960

2 97
38
154
35
1,550
0
132
3

9
0
12
12
102
0

0
0
0
0
4
0
0
0
0
0
3
0
0
0
0
0
0
1
\
0
4
\
\
0
0
2
0
1
0
0
2
2
8
4
0
1
0
0
6
1
1
0
2
0
0
1
4
0
0
0

106
38
166
47

2

s 97

20
0
7
0
6

38
84
0
218
19
24

1
6
0
26
4
0

102

9
9

2 38

0

2

118
61
2

156

271
2

303
6
36
2
14

0
17
28
2
344
40
689
2 232

3
2

427

21
2
2

190
619

52
2 145
34
161
0
48
22

2 242
2
294
0
22
0
2
70

1
19
33
53
0
6
2
0
0

2
15
48
8
74
20
2
39
2
9

111
1
17
0

20
0
5
6
36
28
0

2
0
0
8

1,648

0

0
152
3
45
0
100
39
90
0
244
23
24
110
126
62
171
303
355
6
42
14
0
16
30
17
390
46
755
248
5
465
23
199
724
52
161
34
179
0
53
27
274
322
0
24
0
2

0

78

0

Columbia, all of which are supervised by the Comptroller of
the Currency.

35

TABLE 10.—Branches of national banks opened for
business, by community size and size of bank, Oct.
1-Dec. 31, 1964, and calendar 1964
Jan. 1Category

In cities with population:
Less than 5,000
5,000 to 24,900
25,000 to 49,900
50,000 to 99,900
100,000 to 249,900
250,000 to 499,900
500,000 to 1,000,000
Over 1,000,000
Total
By banks with total resources (in millions of dollars):
Less than $10.0
$10.0 to $24.9
$25.0 to $49.9
$50.0 to $99.9
$100.0 to $999.9
Over $1,000
Total

36




Dec. 31,
1964

190
284
94
58
40
30
44
42
782
122
117
80
64
259
140
782

TABLE 11.—De novo branch, applications of national hanks, by States, Jan. I—Dec. 31, 1964; received, approved,
rejected, abandoned, and pending as of Dec. 31, 1964
State

United States2
Alabama
Alaska
Arizona
Arkan sas
California
Colorado
Connecticut
Delaware
District of C o l u m b i a . . . . . . . . . . . . .
Florida
Georgia
Hawaii
Idaho
,
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi.
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas.
,
Utah
Vermont
Virginia
Washington
West Virginia.
Wisconsin
Wyoming
Virgin Islands
District of Columbia—all3.

Received i

Approved

1,026 j

13
0
11
11
107
0
15
1
4
0
9
0
2
0
13
11
0
5
5
1
19
25
47
0
7
3
0
1
2
9
25
5
54
19
1
59
4
16
53
1
14
1
24
0
7
4
44
18
0
0
0
0

m
0

\

6I
0 i
11 '
0
6
0
14
15
1
6
7
3
37
32
77
0
9
3
0
1
3
12
42
5
96
29
4
71
4
23
87
2
18
2
26
0
11
7
68
26
0
0
0
0

Pending
Dec. 37, 1964

4
0
3
0
28
0
6
0
1
0
0
0
1
0
1
2
0
1
2
2
6
5
18
0
1
0
0
0
1
2
8
0
16
7
1
10
0
1
16
1
4
0
1
0
3
3
7
2
0
0
0
0

10

includes applications pending as of Dec. 31, 1963.
Includes Virgin Islands:.
irgi
g
tio
Includes national and nonnational banks in the District of

2

Abandoned

670

19
1 I
16 I
12

Rejected

Columbia, all of which are supervised by the Comptroller of
the Currency.

3




37

IV. Income and Expenses of National Banks
The composition of earning assets continued to shift
from securities to loans during 1964, and deposits
shifted from demand to time. An analysis of the
income and dividend statements for national banks
reflects these changes. While loans and discounts have
higher yields than securities, the additional supply of
funds raised through time deposits has been more
costly. This price-cost relationship between loans
and time deposits has led banks to search for other
sources of funds. One source is the debenture. The
phenomenal growth of this form of financing during
1964 readily attests to its usefulness.
During 1964, net income of national banks increased
by $7.4 million (see table 12) to a level of $1,213 million. Operating revenue for 1964 exceeded the 1963
level by $845 million, an 11.6 percent increase. Interest and discount on loans accounted for $610 million, or 72.2 percent, of this $845 million increase.
Earnings on U.S. Government securities increased 1.6
percent, while earnings from other securities (mostly
State and local issues) increased $97 million, or 19.2
percent.
Operating expenses for 1964 rose 12.9 percent from
the 1963 level of $5,229 million. Of this $676 million
increase, 51 percent ($345 million) represented the

cost of interest on time arid savings deposits; this was
18.0 percent above the 1963 level—less than the 20.7
percent increase registered in 1963. Salaries and wages
expense rose by 7.9 percent from 1963. Net current
operating earnings increased to $2,243 million in 1964,
$169 million above the 1963 level.
Net income before related taxes dropped to $1,854.7
million in 1964, from $1,893.9 in 1963. This 2.1 percent decline from 1963 can be traced to a net change
of $208.5 million in profits, recoveries, losses, and
transfers to valuation reserves. Profits on securities
sold decreased $44.8 million, or 50.9 percent, from
1963. Transfers from valuation reserves fell $85.7
million, or 81.6 percent, from 1963. Conversely, transfers to valuation reserves increased $36.0 million to
$365.6 million. The net result was a $388.3 million
reduction in operating earnings. After deduction of
$10.2 million for interest paid on capital notes and
debentures, taxable income was reduced to $1,844.5
million.
In 1964, Federal income taxes decreased $57.4 million from the 1963 level. The factors behind this
change were a lower corporate tax rate, and a greater
share of income derived from tax-exempt sources.

TABLE 12.—Current operating revenue, expenses, and dividends of national banks, December 1963 and 1964,
and dollar and percent changes, 1963-64
[Dollar amounts in millions]
Change 1963-64
Item

December
1963

December
1964
Dollar

l

Number of banks
Capital stock (par value) 2
Capital accounts z
Current operating revenue:
Interest and dividends on—
U.S. Government obligations. . .
Other securities
Interest and discount on loans
Service charges on deposit accounts .
Other current operating revenue. . .
Total.
Current operating expenses: 3
Salaries, wages, and fees
Officer and employee benefits 3
Interest on time and savings deposits . . . .
Net occupancy expense of bank premises.
Other current operating expenses
Total.
Net current operating earnings.
See footnotes at end of table.
38




Percent

$4,615
3, 886. 0
13,102.0

$4, 773
4,163.1
14,297.8

158
277.1
1,195.8

3.42
7.13
9.13

1,171.3
504.9
4,621.6
408.8
596.0

1,189.7
601.7
5, 232. 4
441.4
682.5

18.4
96.8
610.8
32.6
86.5

1.57
19.17
13.22
7.97
14.51

7, 302. 5

8,147. 7

845.2

11.57

1,770.0
242.6
1,917.3
313.6
985.3

1, 909.1
266. 0
2, 262. 7
350. 8
1,116.1

139.1
23.4
345.4
37.2
130.8

7.86
9.65
18.01
11.86
13.28

5, 228. 8

5, 904. 7

675.9

12.93

2, 073. 7

2, 243. 0

169.3

8.16

TABLE 12.—Current operating revenue, expenses, and dividends of national banks, December 1963 and 1964,
and dollar and percent changes, 1963-64—Continued
Change 1963-64
December
1963

Item

December
1964
Dollar

Recoveries, transfers from valuation reserves, and profits:
On securities:
Profits on securities sold or redeemed
Recoveries
Transfers from valuation reserves . . .
On loans:
Recoveries
Transfers from valuation reserves
All other

88.1
2.3
44.8

— 44.8
— .7
-5.6

-50.85
-30.43
-12.50

7.6
19.3
57.6

-.5
-85.7
2.1

-6.17
-81.62
3.78

303.8

168.6

-135.2

- 4 4 . 50

34.1
39.3

54.2
41.3

20.1
2.0

58.94
5.09

12.5
329.6
68.1

Total

43.3
1.6
39.2

8.1
105.0
55.5

Losses, chargeoffs, and transfers to valuation reserves:
On securities:
Losses and chargeoffs
Transfers to valuation reserves
On loans:
Losses and chargeoffs
Transfers to valuation reserves
All other

13.5
365.6
82.4

1.0
36.0
14.3

8.00
10.92
21.00

483.6

73.3

15.16

1,854.7

-39.2

-2.07

637.1
50.9

Total

556.9

1,893.9

Total
Net income before related taxes
Taxes on net income:
Federal
State

579.7
51.4

-57.4
.5

-9.01
.98
-8.26

688.0

7.4

0.61

591.5
1.3

44.4
.2

8.12
18.18

548.2

Total

-56.8

* 1,213.3

547.1
1.1

Memoranda items:
Recoveries credited to valuation reserves (not included in recoveries
above):
On securities
,
On loans
Losses charged to valuation reserves (not included on losses above):
On securities
On loans
Stock dividends (increases in capital)

631.2

1,205.9

Net income before dividends
Cash dividends declared:
On common stock
On preferred stock

592.8

44.6

8.14

5.3
60.4

2.6
106.0

-2.7
45.6

-50.94
75.50

11.9
177.7
126.3

32.3
225.9
153.5

20.4
48.2
27.2

171.43
27.12
21.54

Percent
Ratios:
Current operating expenses to current operating revenue
Net income before dividends to capital accounts
Cash dividends to capital stock
Cash dividends to capital accounts
1
Number of banks, as of end of year, but figures of income,
expenses, etc., include banks which were in operation a part
of the year but were inactive at the close of the year.
2
Figures are averages of amounts reported for the June and




Percent

71.60
9.20
14.11
4.18

Percent
72. 47
8.49
14.24
4.15

Change

+ 0.87
-.71
+ .13
-.03

December call dates in the year indicated and the December
call date in the previous year.
3
Exclusive of building employees.
* This figure is after deduction of $10.2 million, interest paid
on capital notes and debentures.

39

V. Litigation
A. Branch Litigation
In 13 actions brought in North Carolina, competing
banks sought to either permanently enjoin the Comptroller's issuance of branch certificates, or to obtain
declaratory judgment that approval and issuance of
the branch certificate were in violation of applicable
branching law and injunctions that prohibit operation
of the branches. In one such case, the plaintiff bank
brought an action against the Comptroller to have his
approval of the branch in question declared unlawful,
and to enjoin the Comptroller from issuing a certificate
of authority to open the branch; and further, to enjoin
the defendant bank from opening the branch in question. The plaintiff bank asserted that the new branch
was unlawful because the defendant bank's capital
structure was inadequate under sections 53-62 of the
General Statutes of North Carolina, and the Banking
Act of 1933 as amended (12 U.S.C. 36 (c)). Plaintiff
bank also alleged that the public necessity and convenience would not be served by the opening of a new
branch and that the establishment of a branch of the
defendant bank at the location in question would
increase competition, thereby causing it to lose customers and business. The plaintiff further contended
that the lack of an adjudicatory hearing at the administrative level violated the Administrative Procedure Act 5 U.S.C. 1004.
Plaintiff bank requested a temporary restraining
order and a preliminary injunction. Defendant bank
moved to dismiss for failure to state a claim upon which
relief could be granted, on the ground that its capital
was adequate, and for want of jurisdiction. The defendant Comptroller moved to dismiss or in the alternative for summary judgment on the grounds that
plaintiff bank lacked standing, that the Comptroller's
decisions and actions were lawful and proper, and that
his discretionary acts were not subject to judicial review. Pending the district court's decision on the
pending motions, the Comptroller refrained from issuing a certificate of authority to open the new branch.
Lack of adequate capitalization by the defendant
bank, the only allegation as to violation of law made
by the plaintiff, was remedied prior to the district
court's ruling when defendant bank altered its capital
structure to meet the requirements of North Carolina
law, even as they were interpreted by the plaintiff bank.
On August 12, 1964, the district court, without
having heard oral argument, granted the plaintiff's
40



preliminary injunction and denied the defendant's
motion to dismiss. The court held the Comptroller's
approval of the branch invalid on the ground that his
failure to grant a full adversary hearing at the administrative level violated the hearing provisions of the Administrative Procedure Act. The court ruled that the
threat of competition presented by the newly authorized branch was sufficient to confer upon plaintiff bank
standing to invoke the district court's jurisdiction. The
court apparently based its ruling on the belief that
judicial review of the Comptroller's decision would be
impossible without such a hearing.
Prior to granting plaintiff bank's motion for summary judgment, the court, at the request of the counsel
of the Comptroller, agreed to hear oral argument for
the first time. In an additional brief and in oral
argument, counsel for the Comptroller pointed out that
if the Comptroller's approval of the branch was reviewable at all, any disputed facts could and should,
under the Administrative Procedure Act, be determined in an evidentiary trial in the district court, and
that no adversary hearing at the administrative level
was required to protect the plaintiff bank's procedural
rights. The district court, however, entered a final
order in judgment declaring invalid the Comptroller's
approval of defendant bank's branch application, and
enjoining him from issuing a certificate of authority
based upon that approval. From that order, notice
of appeal was filed in the Circuit Court of Appeals,
the Fourth Circuit in Richmond, Va., on November 6,
1964. In the appeal, counsel for the Comptroller
argued, first, that the Comptroller of the Currency
has authority to act upon applications for the establishment of new branches without holding an adversary hearing at the administrative level and, secondly,
that competitive banks have no standing to challenge
the Comptroller's determination that a new branch
would be in accord with the public need and convenience and that his determination is at any rate
discretionary and nonreviewable. The first ground
for appeal was broken down into two separate points,
the first of which was that the National Bank Act and
the Administrative Procedure Act authorize the Comptroller to pass upon branch and charter applications
without an adversary hearing. This point was supported by the argument that the Administrative
Procedure Act requires adversary hearing at the administrative level only in cases "of adjudication required by statute to be determined on the record after

opportunity for an agency hearing/' The brief states
that the Administrative Procedure Act does not itself
impose any requirement for an adversary hearing before an agency, but only specifies the procedures to be
followed where some other statute requires such a
hearing.
The Comptroller's appeal was also directed at establishing the rule that competitive banks have no standing to challenge the Comptroller's determination for
public need and convenience and that, at any rate,
the Comptroller's approval or disapproval of a branch
application on the basis of public need and convenience
is discretionary and not subject to judicial review.
First National Bank of Smithfield, North Carolina, v.
First National Bank of Eastern North Carolina, and
James J. Saxon, Comptroller of the Currency of the
United States. Civil Action No. 1460, (E.D.N.G.).
The following cases contained some or all of the issues
involved in the above-mentioned case. Commercial
and Industrial Bank v. James J. Saxon, Comptroller of
the Currency, Civil Action No. 723 (E.D.N.C.), Peoples Bank and Trust Co. v. James J. Saxon, et al., Civil
Action No. 867, (E.D.N.G.), First Citizens Bank &
Trust Co. v. James /.. Saxon, et al. and First Union
National Bank of North Carolina Intervenor, Civil
Action No. 928 (E.D.N.C.), First Citizens Bank and
Trust Company v. James J. Saxon, Civil Action No.
1476, (E.D.N.C.), First National Bank of Smithfield,
North Carolina, v. First National Bank of Eastern
North Carolina and James J. Saxon, et al., Civil Action
No. 1477 (E.D.N.C.), First Citizens Bank and Trust
Company v. James J,, Saxon, Civil Action No. 1589
(E.D.N.G.), First Citizens Bank and Trust Company
v. James J. Saxon and First Union National Bank of
North Carolina Intervenor, Civil Action No. 1663
(E.D.N.C.). Bank of Haw River v. James J. Saxon
(U.S.D.C.M.D.N.C., Greensboro Div., Civil Action
No.C-124G-65).
The other four cases in North Carolina were mooted
either by merger of one of the banks involved or by
withdrawal of the application for the branch by the
applicant bank.
In an action in the U.S. District Court for the
Northern District of Mississippi against the defendant
Comptroller Saxon, a State bank sought a declaratory
judgment that the Comptroller had no authority to
issue a certificate of approval for a branch bank in an
area closely adjacent to the corporate limits of the
town in which plaintiff bank had situated a branch
of its own and was benefiting from branch office protection. Plaintiff bank also sought to enjoin the
Comptroller from permitting such a branch to conduct




business in the county, and alleged that the Comptroller's issuance of a certificate of approval for the
establishment of such a branch constituted an unlawful
establishment of a branch bank facility. At the time
of the litigation, plans were under consideration by
the municipal government to annex the area in which
the branch office of defendant national bank was going to be located. If these plans had been consummated, they would have allowed the national bank
to move its branch into the center of the town which
had been inaccessible to branches of banks based elsewhere. The case is now pending while depositions
are being taken and discovery being made. The Bank
of Tupelo, Mississippi, v. James J. Saxon and First
Citizens National Bank of Tupelo, Mississippi, Intervenor, Civil Action No. EC 6514 (D.C.N.D. Miss.
1965).
The Comptroller's issuance of a branch certificate to
a national bank located in the State of New York
was contested in a case where the new branch was
located in an unincorporated area adjacent to an incorporated village in which several competitive banks
enjoyed home office protection. It was alleged by
three of the defendant national bank's competitors that
the area was prohibited as a branch location of the
defendant bank because, although such area could
qualify for incorporation as a village under state law,
it lacked the required characteristics of a village in the
community sense. It was also alleged that the issuance of a branch certificate was illegal because the
Comptroller violated his own rules and regulations in
processing the branch application. Granting the
Comptroller's motion for summary judgment, the district court held that (1) the Comptroller had complied
with the branch location requirements of 12 U.S.C.
36; (2) that ex parte contacts^ such as were made
with the Comptroller were not prohibited; and (3)
that the opening by the defendant national bank of the
branch in question in temporary quarters did not constitute a new branch application such as might have
required investigations by lower echelons in the Office
of the Comptroller. The Union Savings Bank of
Patchogue et al. v. James J. Saxon, Comptroller of the
Currency, Civil Action No. 2445-62 (D.C.D.C. 1962).
The judgment in favor of the Comptroller and the defendant national bank was appealed to the Circuit
Court of Appeals for the District of Columbia which
vacated the judgment of the district court and remanded the case for further proceedings. The Court
of Appeals, which did not decide the question relating
to the Administrative Procedures Act, held that the
word "village" as used in New York statute law must
41

be given its natural meaning, i.e., an area possessed of
some attributes of a community. In reaching this conclusion the Court of Appeals rejected the administrative interpretation of the New York Banking Law
made by the New York Banking Department, an interpretation which was followed by the Comptroller of
the Currency in approving the disputed branch application of the defendant national bank, to the effect
that if an unincorporated area could be incorporated,
a branch could be located therein. The Court of Appeals held that under section 36(c) of the National
Bank Act, the applicable branching statute under
which the Comptroller operates it is clear that a national bank may establish a branch only where a State
bank branch would be authorized "by the statute law
of the State in question by language specifically granting such authority affirmatively and by implication or
recognition . . .". The court held that the section 36
reference to the statute law of the State refers only to
legislative enactments, and that interpretations of those
enactments—such as the test which was used by the
Comptroller as well as by the New York Banking Department—were not legislation, and therefore could
not be incorporated into the Federal law.
The Court of Appeals held that the judgment of the
lower court granting the motions for summary judgment were reversed, and the district court subsequently
ordered a complete reexamination and reconsideration on the part of all the parties concerned relative to
the application for a new branch in the incorporated
village area. The case is presently pending before the
U.S. District Court for the District of Columbia.
In another case pending in New York State, which
involves the definition of the term "unincorporated
village," competitor banks alleged that the approval
of a branch of a national bank by defendant Saxon was
arbitrary and unlawful under the test set out in the
Patchogue case cited above. Plaintiff bank seeks to
preliminarily and permanently enjoin the Comptroller
(1) from permitting defendant national bank from
opening the branch office in question, and (2) from
issuing any certificate of approval of said branch. Further, the plaintiff seeks to have withdrawn any evidence of approval by defendant Comptroller of the
branch in question, to have a judgment entered declaring Comptroller's action in this respect to be beyond the scope of his discretion and null and void.
Oysterman's Bank & Trust Company v. James J.
Saxon, Civil Action No. 1717-64 (D.C.S.D., N.Y.
1965).
In a recent case in Michigan, plaintiff State banks
sought to enjoin (1) the defendant bank from estab42




lishing a branch, and (2) the Comptroller of the Currency from approving the application of the defendant
bank and issuing a certificate of approval. Further,
the plaintiff sought a declaratory judgment that the
establishment of said branch would be in violation of
12 U.S.C. 36 and section 34 of the Michigan Financial
Institutions Act. Plaintiffs in this action claimed that
the Comptroller's approval of the proposed branch
would be unlawful because: (1) the proposed location
is not within a village; (2) the home office and branch
office protection provision of the foregoing Michigan
statute was ignored; (3) the Comptroller failed to
make a showing of necessity as required by the foregoing Michigan statute; and (4) approval of the application without allowing plaintiffs a hearing or opportunity to cross-examine applicant or offer evidence
in protest was in contravention of the Administrative
Procedure Act, and, furthermore, denied plaintiffs the
procedural due process which is guaranteed by the 14th
amendment to the Constitution of the United States.
In answering the complaint, the defendant Comptroller averred that the provisions of sections 34 of the
Michigan Financial Institutions Act relating to the requirements of "necessity'1 and "prospects of successful
operation" need not be considered by the Comptroller
in deciding whether to authorize the branch in question, since these requirements of State law are not incorporated into 12 U.S.C. 36(c) (2). The Comptroller further asserted that plaintiffs have no right to be
free from competition merely because they are doing
business in the area in question, and he denied the applicability of the Administrative Procedure Act to this
Office in relation to its function of approving applications for branches of national banks. Security Bank
and Wyandotte Savings Bank v. James J. Saxon and
Manufacturers National Bank of Detroit (U.S.D.C.
E.D. Michigan, S.D.C.A. No. 26303).
In a case recently decided in the U.S. District Court
in the Eastern District of Michigan, the court held that
the Comptroller abused his discretionary power by approving a relocation of a branch of a national bank
with its home office in Detroit. The facts in this case
were that the defendant national bank applied to the
defendant Comptroller for permission to relocate one
of its Dearborn branches to a site 1.7 miles away from
its present location, but still within the city limits of
Dearborn. The defendant bank concurrently applied
for a new branch to be relocated, but outside of the
city limits of Dearborn. The plaintiff bank alleged
that the approval of the new branch was designed to
service the customers presently doing business with the
defendant national bank's branch at the site in ques-

tion, and that the relocation of the existing bank would
be, in fact, a new branch in a new area serving an entirely new market. The new area, 1.7 miles away, was
not being served by the defendant national bank and
there was no way in which it could serve such an area
by establishing a new branch. Therefore, the plaintiffs alleged that the moving of the branch facilities by
the defendant bank was part of a total plan or subterfuge to evade the language and spirit of section 36 of
title 12 of the United States Code, as it incorporates the
provisions of section 34 of the Financial Institutions
Act of Michigan. Implicit in this charge was the allegation that the relocated branch would be, in fact, a
de novo branch that would violate section 34 of the
Michigan Financial Institutions Act. The court held
in its oral opinion that 12 U.S.C. 36(c) incorporated
the provisions of State law such as section 34 of the
Michigan Financial Institutions Act which provided
in part "that no such branch shall be established in a
city or village in which a state or national bank or
branch thereof is then in operation." The court agreed
with the plaintiff that; the proposed relocation of one
office within Dearborn and the simultaneous establishment of a new office near the city limits outside Dearborn, did not constitute a bonafide relocation, but
instead constituted an unlawful attempt to establish a
new branch within the city of Dearborn. Bank of
Dearborn v. James J. Saxon et al. Civil Action No. 23,
628 (U.S.D.C.E.D. Mich., sec. div. F).
In two Utah cases., it was alleged that the Comptroller's authorization of a branch in the same city in
which the principal office of the bank is located would
be in violation of the Utah Statute which provides, in
part, that ". . . no branch bank shall be established in
any city or town in which is located a bank or banks
. . . " In one case the district court in Utah held
that the Comptroller violated neither Federal nor Utah
law when he authorized a de novo branch in Logan,
Utah of the defendant bank in 1963. The court held
that since Utah law expressly provided for the acquisition of in-city branches of state banks by merger, and
that since the Comptroller, under section 36(c)(l),
may approve in-city branches of national banks where
there is corresponding provision for such branches of
State banks, he may therefore approve in-city branches
de novo. Since the plaintiff Utah State banks could
branch by merger in their home office city, the Comptroller was acting properly when authorizing a de
novo branch in the home office city. The plaintiff
State bank appealed this ruling, and hearings before
the United States Circuit Court of Appeals for the
Tenth Circuit in Denver have been tentatively set.




Walker Bank & Trust Company v. James J. Saxon
et al., Civil Action No. 137-63 (D.C.D. Utah 1963).
In the second Utah case, pending in the District Court
for the District of Columbia and essentially based on
facts similar to those above, the district court reached
a decision contrary to that reached in the Utah Court.
The court held that the plaintiff State bank had
standing to sue in this case, that the defendant Comptroller's decisions were reviewable, and that the sole
issue in question was whether the Comptroller had the
statutory authority to grant a certificate to the defendant national bank for the establishment of a de novo
branch in the city of Ogden, Utah. The Washington
court held that in order to maintain the competitive
balance sought by Congress in enacting the McFadden
Act of 1927 (part of which is contained in 12 U.S.C.
36(c))j national banks in Utah can open de novo
in-city branches by merger only. Commercial Security
Bank v. James J. Saxon, and First Security Bank of
Utah, N.A., Intervenor, Civil Action No. 1815-63
(D.C.D.C. 1964).
In an Indiana action concerning the Comptroller's
authority to authorize branch banks, a State bank is
seeking (1) a declaratory judgment that the issuance
by the Comptroller of a certificate authorizing the
establishment and operation by a national bank of a
branch bank is in violation of the applicable branching laws, and (2) to enjoin the defendant bank from
operating the branch in question. This action also
involves an interpretation of 12 U.S.C. 36(c) (1) concerning branching by a national bank "inside" the city
of its home office in States where a State bank can
have "inside" branches. Here the Comptroller argued
in this case that certain restrictions of state law did not
apply to national banks. The Comptroller specifically
alleged that even if 12 U.S.C. 36(c) (2) (which deals
with "outside" branches and incorporates location restrictions of state law), were applicable to "inside"
branches, the Indiana requirement that a new branch
must not "jeopardize" an existing banking office is not
the kind of location requirement that would be incorporated, or that would raise questions subject to judicial review. The case is presently pending before the
Indiana District Court. North Madision Bank v. National Bank of Madison, Indiana, and James J. Saxon,
Comptroller of the Currency Civil Action No. N.A.
63-C-76, (D.C.S.D. Indiana 1963).
In another Michigan case, plaintiff bank sought (1)
a declaratory judgment that approval of the proposed
branch would be in violation of 12 U.S.C. 36 and
section 34 of the Michigan Financial Institutions Act,
and (2) to enjoin the issuance of the branch certificate
43

and the defendant bank's establishment of the proposed branch. Plaintiff claimed that the Comptroller's
approval of the proposed branch would be unlawful
because: (1) the proposed location was not within
an incorporated village; (2) the head office and branch
protection provision of the Michigan Statute was
ignored; (3) the Comptroller failed to make a showing
of necessity; and (4) approval of the application without allowing plaintiff or formal hearing was in contravention of the Administrative Procedure Act. The
Comptroller's answer stated that the proposed location
had the indicia of a village and that no other branches
were located in the same village. With regard to the
formal hearing demand, the Office position—as set
forth in the Smithfield case—was repeated. (In two
recent cases, the United States District Court in
Michigan took the position that no formal record is
necessary for judicial review of Comptroller cases.)
The Southern Michigan National Bank of Coldwater
v. James J. Saxon and First National Bank of Quincy,
Civil Action No. 4948 (D.C.W.D. Mich., Southern
Division).
After granting a partial summary judgment on
motion by the defendant Comptroller of the
Currency—that the defendant is not required to hold
a hearing prior to granting approval for the establishment of a branch of a national bank, and that the defendant is not bound by State statutory requirements
to the necessity or prospect for a successful operation
of a branch bank—the U.S. District Court for the
Eastern District of Michigan, Southern Division, held
that the Comptroller of the Currency had acted arbitrarily under applicable law in approving the branch
in question. The basis for the court's decision was a
detailed analysis of the factual situation as it existed
in the unincorporated area in which the branch was
located, considering aspects of population, housing,
business, and geographical distribution, as well as
other factors encompassing the indicia of a community. In reaching its conclusion, the court felt that the
Comptroller's decision to approve the establishment of
the disputed branch bank was not supported by competent, substantial evidence, that it must have been
based upon misplaced confidence in information supplied by the defendant bank, and that the decision was
therefore arbitrary, capricious, and an abuse of discretion under the applicable law since it disregarded
the factual situation. Peoples Bank—Trenton, et al. v.
James J. Saxon and Manufacturers National Bank
of Detroit, Civil Action Nos. 26166, 26167,
(U.S.D.C.E.D., Michigan, 1965).
In a recent case involving the Fort Knox National
Bank at Fort Knox, Ky., the major issue in question
44




was whether a military reservation is considered to be
a part of the State of Kentucky for the purposes of
12 U.S.C. 36(c). Fort Knox itself was ceded to the
United States by the State of Kentucky and became a
Federal enclave. After the Fort Knox National Bank
was chartered, it did business until recently only within
the U.S. military reservation. An application for a
branch of Fort Knox National Bank to be located in
Hardin County, Ky., in the town of Radcliff, was approved by this Office. This approval immediately met
opposition from competing banks in the State. The
principal argument against the proposed branch was
that since Fort Knox National Bank was not subject
to that State's jurisdiction, it was not legally within
the State and could not therefore legally branch into
the state. The position of this Office is that the main
office of the Fort Knox National Bank is geographically
located within the boundary lines of Hardin County,
Ky., and that the bank can, therefore, branch anywhere within the county, limited only by 12 U.S.C. 36
and applicable state law as it is therein incorporated.
The Comptroller has moved to intervene in this case
because of the unusual and important issue involved.
First Hardin National Bank and The Farmers Bank
of Vino Grove, Kentucky v. Fort Knox National Bank
(U.S.D.C., W.D. Kentucky, C.A. No. 5046.)
In a recent case involving a branch office of a national bank in New Jersey, the plaintiff State bank
sought to have the authorization certificate of the
branch in question declared to have been issued in contravention of law, and thus null and void. It alleged
that the Comptroller "erroneously" authorized a national bank to open a new branch, since at that time
an application by a State bank was pending before the
New Jersey Commissioner of Banking and Insurance
for permission to establish a branch banking office in
the same area applied for by the national bank in
question. The State bank alleged that the Comptroller,
in granting the national bank the authority to open a
new branch, violated 12 U.S.C. 36(c). Plaintiff
further alleged that the ex parte contacts made with
the Comptroller's Office by the national bank in question constituted a denial of basic administrative fairness to the plaintiff, in violation of the due process
clause of the U.S. Constitution and sections 5, 8, and
10 of the Administrative Procedure Act, 5 U.S.C, sections 1004, 1007, and 1009. The plaintiff further
alleged that the Comptroller's regulations, contained
in 12 CFR section 4 relevant to the processing of a
branch application, are invalid under section 3 of the
Administrative Procedure Act (5 U.S.C. sec. 1002).
Plaintiff also claimed that defendant's actions in allow-

ing the defendant national bank to establish a branch
bank in the area in question not only denied the plaintiff the right to establish a branch there, but also subjected the plaintiff to unlawful competition. The
position of this Office in relation to the plaintiff bank's
arguments concerning the Administrative Procedure
Act are set out in the summary in the Smithfield
Branch case., supra. The Bank of Sussex County v.
James J. Saxon (U.S.D.C, D.N.J. G.A. No. 568-65.)
The First National Bank of Valdosta, Valdosta, Ga.,
received permission from the Comptroller of the Currency to construct a drive-in facility 281 feet from its
main banking office. After careful consideration, the
Comptroller determined that the facility would not
constitute a branch under 12 U.S.C. 36(c), but would
be a complementary part of the main banking house,
not requiring the issuance of a branch certificate. On
March 11, 1964, W. M. Jackson, superintendent of
banks, State of Georgia., filed a removal petition in the
State court and the case was removed to U.S. District
Court for the Middle District of Georgia. Prior to
reaching a decision as to whether the facility was a
separate branch or an extension of existing facilities,
the court removed the restraining order against operation of the facility on the grounds that the superintendent did not have standing to bring the suit. This
decision is now on appeal before the Fifth Circuit
Court of Appeals. The Independent Bankers Association has filed a brief in this case as amicus curiae.
W. M. Jackson, Superintendent of Banks of the State
of Georgia v. First National Bank of Valdosta
(U.S.D.C. M.D. Ga., Civil Action No. 647).
In a similar case in the State of Washington, a corporation formed by State banks sought a preliminary
injunction against a national bank from opening a
facility some 100 feet away from its branch office in
accordance with the approval of the Comptroller of
the Currency. The injunction was granted, pending
hearing on the case's merits; the State supervisor of
banking later intervened under the permissive intervention rule. The issue in question is whether the
facility is or is not a branch. State Chartered Banks
et at. v. Peoples National Bank et al.

B. Conversion Litigation
In an action pending in the U.S. District Court for
the District of New Hampshire, three national banks
located in Manchester, New Hampshire, filed a suit
challenging the legality of the conversion of the
Manchester Morris Plan Bank into a national bank.
The plaintiffs seek (1) a declaratory judgment that
the Comptroller's approval of the conversion was




illegal, and (2) an injunction prohibiting the issuance
of a conversion certificate. In support of their position, plaintiffs argued that (1) the Manchester Morris
Plan Bank is not a "bank" within the meaning of the
laws of the State of New Hampshire, or within the
meaning of national laws; (2) The Manchester Morris Plan Bank is an affiliate of the Indianhead National
Bank of Nashua or New Hampshire Bank Shares, Inc.,
and thus would be a branch bank or an affiliate of Indianhead National Bank of Nashua or New Hampshire
Bank Shares, Inc., a relationship prohibited by State
law. The Comptroller maintains that the New
Hampshire statute which permits State banks to be
converted to national banks applies to a bank incorporated under State law, or pursuant to an act of the
State legislature, as is the case of the Manchester Morris Plan Bank. He further argues that the nature of
the Manchester Morris Plan Bank is shown by the
fact that it accepts deposits, makes loans, and has other
indicia of a bank. He also maintains that neither the
Indianhead National Bank of Nashua nor New Hampshire Bank Shares, Inc., own any shares of Manchester
Morris Plan Bank. Finally, if the Manchester Morris
Plan Bank is converted into a national bank, the
Comptroller argues that it will be a unit bank and not
a branch of the Indianhead National or New Hampshire Bank Shares, Inc. Whether the Manchester
Morris Plan Bank is a bank subject to conversion under
New Hampshire law is being determined by a State
proceeding in a companion case. This determination
will be dispositive of one of the main issues in the
Federal case. Amoskeag National Bank et al.
(U.S.D.C.N.H.) C.A. No. 2495.

C. New Bank Charter Litigation
One of the principals in a recently organized State
bank in Nebraska filed an action against the Comptroller, the Omaha National Bank, and a proposed new
national bank called the Indian Hills National Bank,
challenging the legality of the chartering of the proposed bank. Plaintiff sought a declaratory judgment
that the Comptroller's approval of the application to
charter the proposed bank would be, in actuality, a
branch of the Omaha National Bank, and therefore a
violation of 12 U.S.C. 36. Plaintiff pointed to the
ownership of the proposed bank by shareholders of the
Omaha National Bank, contending that the proposed
bank would not be a separate banking entity as purported, but would be in fact a branch of the Omaha
National Bank, and as such, prohibited by Nebraska
banking law. The plaintiff also alleged that the Administrative Procedure Act was violated because of the
45

Comptroller's failure to grant a full adversary hearing.
The permission to charter the bank (which the plaintiff held would in effect authorize a branch of the
Omaha National Bank) would be an additional violation of the Administrative Procedure Act (5 U.S.G.
1009), because it would be arbitrary, capricious, and
an abuse of discretion on the part of the Comptroller.
The U.S. District Court for the District of Nebraska,
in denying the plaintiff's motion for a preliminary injunction to prevent the Comptroller from issuing the
new charter, did not subscribe to the theory that the
Administrative Procedure Act required the Comptroller of the Currency to have a formal hearing before
approving a national bank charter. The court held
that the Administrative Procedure Act (5 U.S.C., section 1004), provides for a hearing "in every case of
adjudication required by statute to be determined on
the record after opportunity for an agency hearing,"
but that, since there is no provision in the National
Bank Act, 12 U.S.C. 1 et seq. for such a hearing, none is
required. The court went further, in finding that 12
U.S.C, section 27, provides that a certificate for a new
bank charter shall be issued in the following manner:
If, upon careful examination of the facts so reported, and of any other facts which may come
to the knowledge of the Comptroller, whether by
means of a special commission appointed by him
for the purpose of inquiring into the condition of
such association, or otherwise, it appears that such
association is lawfully entitled . . .
The court stated that not only does the quoted statute not require a hearing, but also that it negates the
necessity for a hearing by providing other possibilities
for reaching a decision.
However, the court held that if the proposed bank
would in reality be a branch of the Omaha National
Bank, the State bank would thereby suffer a legal
wrong because of the Comptroller's action. Section
5 U.S.C. 1009(a) provides that "any person suffering
legal wrong because of any agency action, or adversely
affected or aggrieved by such action within the meaning of any relevant statute, shall be entitled to judicial
review thereof." Therefore, the court held that the
Administrative Procedure Act provides for a judicial
review of the action taken by the Comptroller. It felt
that once the plaintiff has alleged a legal wrong, it was
the court's duty to review the decision upon petition of
the plaintiff, and to "hold unlawful and set aside, any
agency action, findings, and conclusions found to be
(1) arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law." The case has
not yet been heard on its merits. 5 U.S.C. 1009(E)
46




(B) (1). William R. Farris v. Indian Hills National
Bank et al. and James J. Saxon (D.C. Neb.) Civil Action No. 02146, 1964.
In a new-bank-charter case in Missouri in which the
charter had already been issued, the plaintiff banks
challenged the legality, under the Administrative Procedure Act and the fifth amendment to the Constitution of the United States, of a charter granted to the
defendant bank. The issue is whether the Comptroller is required to hold a formal hearing under the Administrative Procedure Act and the due process provision of the U.S. Constitution in a case where a competitor bank opposes the approval of a new national
bank. A complete discussion of the position of this
Office on the hearing issue is presented in the comments on the Smithfield branch case. Citizens National Bank of Maplewood et al. v. James J. Saxon
and West Side National Bank (U.S.D.C.E.D. Mo.
Civil Action No. 65 C 32 CD).

D. Merger Litigation
In a recent case brought by the Justice Department
to enjoin the merger of the Mercantile Trust Co. National Association, St. Louis, Mo., and the Security
Trust Co., St. Louis, Mo. (which merger was approved
by the Comptroller pursuant to the provisions of the
Bank Merger Act of 1960 [12 U.S.C. 1828(c)]), the
Department of Justice alleged a violation of section 1
of the Sherman Act (15 U.S.C. 1) and section 7 of the
Clayton Act (15 U.S.C. 18).
In its complaint, filed on July 7, 1965, the Justice
Department sought (1) preliminary and permanent injunctions preventing the banks from carrying out the
agreement of merger, and (2) in the event that the
merger does take place, relief under section 1 of the
Sherman Act and section 7 of the Clayton Act, which
would require the resulting bank to divest itself of all
stock, assets, and other properties of the bank to be
merged, i.e., Security Trust Co.
The Comptroller, to present his views on the merger
relative to the alleged violation of the antitrust laws,
moved to intervene as a party defendant in opposition
to the Department of Justice. Acting on his own behalf, the Comptroller sought, and was granted, leave
to intervene because of his continuing interest in
maintaining the efficacy of the National Banking System in general and the merged Mercantile Trust Co.
National Association in particular, and also because
it was felt that the interest of the National Banking
System and the public at large would be more adequately protected by the Comptroller's expertise in
the area of bank mergers.

For the purpose of deciding the motion for preliminary injunction, the court assumed, without deciding, that it had jurisdiction. Addressing itself to
the major factual question at issue-—the relevant geographic market to be considered—the court found
that area to be not the city of St. Louis, as contended
by the Department of Justice, but the entire metropolitan area of St. Louis. Therefore, in the relevant
market area as determined by the court for the purposes of the motion, the resulting bank would have
slightly over 20 percent of the deposits and loans of
all the banks therein. These percentages are substantially less than the percentages considered in
United States v. Philadelphia National Bank, 374 U.S.
321 (1963) and United States v. First National Bank
and Trust Co. of Lexington, 376 U.S. 665 (1964).
The court therefore held that, after considering all
of the facts and circumstances in evidence, the plaintiff had failed to sustain its burden of proof that there
was a probable violation of the Sherman or Clayton
Antitrust Acts. After the injunction was denied, the
banks merged and the parties stipulated that a trial
date would be set at a future time. United States v.
Mercantile Trust Company National Association and
Security Trust Company and Comptroller of the Currency, James J. Saxon, [U.S.D.C. E.D. Mo.] Civil Action No. 65 C-241 (1).
In another action involving a merger approved by
the Comptroller of the Currency, the United States v.
Crocker-Anglo National Bank, Citizens National Bank
and Transamerica Corporation, Civil Action No. 41808
(D.C.N.D. Cal. 1963), the Justice Department contended that the merger violated both the Sherman and
Clayton Antitrust Acts by lessening competition and
tending toward monopoly. After a finding denying the
Government's motion for a preliminary injunction, the
case was brought to trial. The court is presently considering the evidence adduced at trial, and briefs will
be submitted in the near future. This case is described
in detail at page 48 of the 1963 Annual Report of the
Comptroller.
In still another merger case in which the Justice
Department alleged a possible violation of section 1
of the Sherman Act and section 7 of the Clayton Act,
the U.S. District Court for the Middle District of Tennessee denied a motion to enjoin the merger. At that
time, the court stated that it had—
been presented with no facts to indicate any bad
faith on the part of the parties concerned with
the merger and no facts from which to conclude
that they had entered into an unlawful combination or agreement. On the contrary, the natural
and reasonable inference is that a merger pre-




sented itself as a logical alternative to the expenditure of large sums of money to improve the
facilities and services of the [State bank] Trust Co.
and to place it in a position to compete successfully
in a market which the evidence shows to be one
of the most fiercely competitive in the United
States.
The case is now in the stage of discovery proceedings,
and trial date has not yet been set. United States v.
Third National Bank of Nashville et al., Civil Action
No. 3849 (D.C.M.D. Tenn. 1964).
The only other merger case still pending that involves final approval by the Comptroller is one approved by Comptroller Ray M. Gidney, United States
v. Continental Illinois National Bank and Trust Company of Chicago et al, Civil Action No. 61 C1441
(D.C.N.D., 111. 1964), The merger has been consummated with the case presently awaiting trial, the
court having denied the Government's motion for a
preliminary injunction. There has been no change in
the status of this case since the publication of the 1962
Annual Report.

E. Conservatorship Litigation
A lawsuit presently before the U.S. District Court
in the Northern District of Oklahoma was brought
after a national bank in Oklahoma was placed in
conservatorship in 1963 by the Comptroller. Following the termination of the conservatorship and the
transfer of the old bank's assets and liabilities to a
new national bank, a complaint was filed by an organizer, director, and stockholder of the old national
bank. The relief sought includes a rescission of all the
documents evidencing the sale of assets to and the
assumption of liabilities by the new bank, the payment of damages by the defendant conservator and
the new national bank, and the appointment of a receiver to take charge of the operations in the new bank
for the preservation of the assets of the old bank. The
plaintiff's motion for a summary judgment has been
recently denied and the case is now awaiting trial. S.
Paul Hazen v. Southern Hills National Bank of Tulsa
and William H. Greenfield, Conservator of Southern
Hills National Bank, Civil Action No. 5842 (D.C.N.D.,
Okla. 1963). A detailed discussion of this case appears in the 1963 Annual Report of the Comptroller
of the Currency.
Another case arising from the placing of a national
bank in conservatorship in 1962 was discussed on pages
16, 18, and 19 of the 1962 Annual Report of the
Comptroller of the Currency, and page 54 of the 1963
Annual Report. The Third Circuit Court of Appeals
has reversed and remanded the case to the District
47

Court of the Middle District of Pennsylvania on the
ground that the action of the Comptroller in terminating the conservatorship and waiving the shareholder
meeting (required by 12 U.S.C. 181) was reviewable.
The Comptroller acted under section 181 of 12 U.S.C.,
which provides that any liquidation of a national
banking association that "is to be effected in whole or
in part through the sale of any of its assets to and the
assumption of its deposit liabilities by another bank,
the purchase and sale agreement must also be approved by its shareholders owning two-thirds of its
stock unless an emergency exists and the Comptroller
of the Currency specifically waives such requirement

for shareholder approval." The court held that to
construe the statute as entrusting to the Comptroller
a nonreviewable discretion in this area would have the
effect of decreasing the safeguards available to shareholders under preexisting law, which in this case would
be approval by vote of two-thirds of the outstanding
stock. The only issue where the District Court's
decision was reversed concerned the reviewability of
the Comptroller's action under 12 U.S.C. 181, while
all the other issues, such as the decision of the board of
directors to sell the assets, were resolved in favor of the
Comptroller's position. Minichello et al. v. Saxon et al.

337F.2d75(1964).

VI. Fiduciary Activities of National Banks
During 1964, the major efforts of the Comptroller's
Office relating to the fiduciary activities of national
banks were directed to the improvement of the examination process, and to the adaptation of regulation
9 to evolving developments in the corporate fiduciary
industry.
In February, a conference was held in Washington
for all representatives in trusts from the 14 national
bank regions. This conference had three objectives:
To resolve specific examination difficulties; to improve
procedures generally; and to standardize examination
techniques in all regions. Significant progress was
made in all of these areas. Another meeting of examiners was held in November at the occasion of the
Mid-Continent Trust Conference of the American
Bankers Association in Chicago. Special attention was
given at that time to the effectiveness of examination
procedures, with emphasis upon possible modifications
which might be necessitated by automation. Study is
still being given to these matters. In September, the
second school for trust examiners was held in Washington, D.C.
In February, a favorable tax ruling was obtained

from the Internal Revenue Service concerning the collective investment of moneys of certain managing
agency accounts. Minor corresponding changes were
made in regulation 9 at that time. During the course
of the year, a number of rulings were issued pertaining
to the exercise of fiduciary powers by national banks.
These included rulings concerning proper expenses
chargeable to collective investment funds, successor
fiduciary accounts, organization of trust departments,
verification of trust department assets^ real estate mortgage investments in collective investment funds, and
investments of fiduciary funds in variable amount
notes.
The June 1965 issue of the National Banking Review contained an article entitled "Bank Trust Investments in 1964." This article was based upon annual reports of trust departments of national banks,
which for the first time reflected market value figures
of fiduciary assets, and material gleaned from annual
reports of collective investment funds filed with the
Office pursuant to regulation 9. Tables B-21 and
B-22 contain data on bank trust assets and income, and
common trust funds.

VII. International Banking and Finance
National banks expanded the scope and volume of
their international activities at an impressive rate during 1964. The overseas branches, foreign financing
and banking affiliates, and international banking de48




partments of national banks contributed significantly
to thefinancingof the increased volume of U.S. foreign
trade, and to the economic development of the developing nations.

During the year, the number of national bank foreign branches increased from 123 to 139, and their total
resources increased from $2.6 billion as of December
20, 1963, to $3.3 billion on December 31, 1964. This
27-percent increase in foreign branch assets of national
banks exceeded considerably the growth rate of commercial banks generally in the United States.
London accounted for over 50 percent of the 1964
growth in overseas branch resources. At the end of
1964, the London branches held in excess of 30 percent
of the total foreign branch assets of national banks.
Tables B-29, B-30, and B-31 show the location and
consolidated statement of assets and liabilities of foreign branches.
The foreign banking and financing affiliates of national banks also increased their activities during 1964.
At the end of the year, 13 national banks had direct
investments in 18 subsidiaries engaged in international
banking and finance. The combined assets of these
corporations exceeded $750 million, and their capital
funds exceeded $100 million.
Four national banks operate subsidiary banks in New
York City. These subsidiary banks specialize in international or foreign banking. Another national
bank has a subsidiary banking corporation that maintains a branch in Hong Kong.
The foreign banking and financing affiliates of national banks have made equity investments in excess
of $35 million in industrial and financial institutions
operating throughout the free world. Commercial
banking or trust company affiliates of national banks
operate in the following countries: Argentina, Bahamas, Cameroon, Canada, Central African Republic,
Chad, Congo Republic, Dahomey, France, Gabon,
Iran, Islamic Republic of Mauritania^ Italy, Ivory
Coast, Liberia, Libya, Mali, Netherlands, Niger, Nigeria, Senegal, South Africa, Spain, Togo, Turkey, and
Upper Volta.
In addition, development banks and other financial
affiliates of national banks operate in Argentina, Australia, Bahamas, Colombia, England, France, Germany, Greece, India, Luxemburg, Malaysia, Nigeria,
Pakistan, Philippines, South Africa, Spain, and Switzerland.
The increased importance, both to the banks and
the public, of the international activities of national
banks called for improved supervision. An International Operations Division, headed by the Deputy
Comptroller of the Currency for International Banking and Finance, was established in 1964 to supervise
more efficiently the international activities of national
banks. The Department of Banking and Economic




Research is also increasing its research activities in the
international sphere.
National Bank Examiners in the International
Operations Division are receiving specialized training
in foreign languages as well as in international banking
and finance. Pilot examinations of selected branches
were conducted in Latin America early in 1965. Based
on the procedures and techniques developed in the
pilot examinations, regular overseas examinations will
be conducted in the future.
The International Operations Regulation (12 CFR
20) became effective September 7, 1964, and has
proven to be an additional and effective tool in the
supervision of the international activities of national
banks. That regulation requires prior notification of
the intention: to establish foreign branches; to acquire
a controlling interest in an Edge Act corporation, an
agreement corporation, or a foreign bank; to establish
branches of controlled banks or corporations and to
acquire indirect control of foreign banks or corporations. National banks also report within 30 days of
the consummation of other transactions such as the
acquisition of less-than-control of a foreign bank.
The transfer from the Federal Reserve Board to the
Comptroller of the Currency of the authority to charter
foreign branches would increase the efficiency of the
supervision of the international activities of national
banks. Although the Comptroller of the Currency
has the responsibility for the supervision of all
activities—domestic and foreign—of national banks,
the chartering power for foreign (but not domestic)
branches of national banks is exercised by the Federal
Reserve Board. Appropriate legislation transferring
this chartering authority to the Comptroller is under
consideration by the 89th Congress.
During the past year, and for the first time in the
history of the Office, the Comptroller traveled extensively to assess and survey American and foreign
banking overseas. In September 1964, the Comptroller was a special adviser to the Secretary of the
Treasury at the International Monetary Fund and
International Bank for Reconstruction & Development
meetings in Tokyo. Following the completion of these
meetings, he visited with American branches and local
banks in Japan, Hong Kong, and the Philippines. In
November, the Comptroller traveled to France, Spain,
Italy, Turkey, Greece, Egypt, England, Sweden, Denmark, Germany, and The Netherlands to confer with
local government officials and the heads of local and
American banks operating in those countries.
To further the exchange of banking information and
supervisory techniques and experiences, the Comptrol49

ler provides orientation and training programs for foreign bankers and bank supervisors. These programs
range in duration from a day to more than a month.
During the past year, teams from France, India, Indonesia, Iraq, Japan, Korea, Philippines, Turkey, and
Yugoslavia visited and trained at the Washington and
field offices. Other foreign bankers and officials have
also expressed considerable interest in the progress of
the National Banking System and its supervision.
These officials have received copies of our manuals
and publications.
In 1964, the Comptroller of the Currency was requested by the National Bank of Vietnam and the
Agency for International Development, Department of
State, to furnish training assistance for the National

Bank of Vietnam. The Director of the International
Operations Division and a national bank examiner
participated in this program in Saigon. They trained
Vietnamese bank examiners and served as advisers to
the Central Bank in the implementation of Vietnam's
recently enacted banking legislation.
As requested by the President in his 1965 Balance
of Payments message, the Comptroller of the Currency
is participating in the supervision of the voluntary foreign credit restraint program. National bank examiners, in connection with the regular examinations of the
international activities of national banks, are appraising and reporting on the effectiveness of the program.
However, since the program is voluntary, the examiners
do not enforce the credit restraint guidelines.

VIII. Management Improvement
Increased Washington-Region communication at
the highest levels has succeeded in establishing a common concern for efficiency. Regional visits by highechelon members of the Washington staff, including
Deputy Comptrollers, economists, and attorneys, as
well as Regional Comptrollers' Conferences, have been
successful in bringing about this desired objective.
The following are examples of important management improvements effected during the year:
The training and planning stages of the installation
of automatic data processing have borne fruit in the
completion of the payment-of-travel-vouchers phase.
In addition, this Office has nearly completed the assumption of its own checkwriting function. The ADP
equipment is already programmed to produce several
expense reports, and completion of this phase is approaching rapidly. The ADP system has already allowed substantial annual savings.
A continuing policy of decentralization of duties,
where economy or effectiveness warrants, has found
expression in several actions through the last year. The
14 Regional Comptrollers have been given additional
discretionary functions formerly reserved to the Washington Office. Attorneys have been assigned to several
Regional headquarters, allowing more frequent and
more immediate transmission of Office opinion to
bankers and other interested parties. The Regional
Offices have also assumed the responsibility for examining travel vouchers and for reviewing certain aspects
of bank examination reports. These two activities were
removed from Washington at a great saving in time
50




and dollars. Further, the performance of these functions was greatly improved by their allocation to points
closer to the traveling force and to bankers. New
travel regulations were promulgated to provide more
equitable reimbursement to the force. This policy of
decentralization has also yielded considerable savings.
The Office conducted a 1-week program where Regional personnel were instructed in the performance
of their new duties. An illuminating side effect of
this school was the discussion of common problems by
Washington and Regional personnel. Intra-Office
communication was greatly advanced.
The new Report of Examination, which was introduced in the latter part of 1964, provides a more efficient device for obtaining data for supervisory and
statistical purposes.
Several instances of continuing management improvements were instituted during 1965, for example:
The development of new comprehensive records retention and disposition schedules and of a new filing
categories system is substantially complete. Substantial savings are expected from this program through the
elimination of duplication and accumulated records
materials.
A new division of personnel planning and development was inaugurated to enable management to identify at an early stage men of exceptional talent capable
of advancement to higher positions in the Office. The
program consists of manpower inventory and projection of manpower needs. One substantial improve-

jiicnl ai: ..:1\ ' w M / . ' u , • . '•< \ ; •!' j !',-\o(.ion. p l a n .
•
T h r o n g : , lejulcii. o b j i r ' ^ t - t •..llna-iorij of e a c h e m -

p'cr. o;\ the Office '.civs LO cstabliVi a*, cnuc of employee
growth. Even qualified employee is assured of
substantial incentives and rewards for notable performance.
Regional schools for examiners designed to give instruction in the techniques of examining bank-oper-

ated automatic data processing were started in 1964,
and are held on a continuing basis as part of the
Office's training program. These schools were formerly held in Washington, but have been decentralized
to the regions. This decentralization has resulted in
smaller classes, with a concomitant increase in student
participation and benefit together with a significant per
capita cost reduction.

REGIONAL ORGANIZATION
Regional comptroller

Headquarters

Elmer J. Peterman. . . .

Boston, Mass

Charles M. Vein Horn.
Marshall Abrahamson.
Frank H. Ellis.
Paul E. Lackland

New York, N.Y
Philadelphia, Pa
Cleveland, Ohio
Richmond, Va

Donald B. Smith
Joseph G. L u t z , . . . . . .
William A. Robson

Atlanta, Ga
Chicago, III
Memphis, Tenn

Douglas T. Bushman..
; Paul L. Ross.
i Norman R. D u n n . . .
j John R. Thomas
i Kenneth W. Leaf
i Arnold E. Larsen




Minneapolis, Minn. .
Kansas City, Mo. . . .
Dallas, Tex
Denver, Colo
Portland, Oreg
San Francisco, Calif..

States

Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, Vermont.
New Jersey, New York.
Pennsylvania.
Indiana, Kentucky, Ohio.
Delaware, District of Columbia, Maryland, North
Carolina, Virginia, West Virginia.
j Florida, Georgia, South Carolina.
I Illinois, Michigan.
] Alabama, Arkansas, Louisiana, Mississippi, Tenj nessee.
Minnesota, North Dakota, South Dakota, Wis| consin.
j Iowa, Kansas, Missouri, Nebraska.
i Oklahoma, Texas.
| Arizona, Colorado, New Mexico, Utah, Wyoming.
| Alaska, Idaho, Montana, Oregon, Washington.
| California, Hawaii, Nevada.

51

COMPTROLLER OF THE CURRENCY
Chart of Organization

Regional Comptrollers
of the Currency

Comptroller
nf thp
Currency

National Advisory
Committee
to the
Comptroller of the
Currency

Regiona Advisory

Director,
Department of Banking
and
Economic Research

Deputy
Comptroller
for Bank
Supervision

Deputy
Comptroller

for
New Charters

Chief Counsel

First Deputy
Comptroller
Administrative Assistant
to the Comptroller

Deputy
Comptroller
for Trusts

Deputy
Comptroller

Deputy
Comptroller

Deputy
Comptroller

for

for

for

Mergers

Domestic
Bank
Operations

International
Banking

and

and

Examination

Branches

and
Finance

52




COMPTROLLER OF THE CURRENCY
First Deputy Comptroller

JAMES J. SAXON

Wiliiam B. Camp

Administrative Assistant to the Comptroller

Anthony G. Chase

Deputy Comptroller for Bank Supervision and Examination Justin T. Watson
Deputy Comptroller for New Charters Thomas G. DeShazo
Deputy Comptroller for Trusts Dean E. Miller
Deputy Comptroller for Mergers and Branches Richard J. Blanchard
Deputy Comptroller of Domestic Bank Operations

R. Coleman Egerfson

Deputy Comptroller for International Banking and Finance
Director, International Operations

E. Radcliffe Park

Wallace R. Anker

Director, Department of Banking and Economic Research Victor Abramson
Chief Counsel Robert Bloom
Associate Chief Counsel Roman J. Gerber
Associate Chief Counsel Charles E. McEnerney
Associate Chief Counsel Ernest Ginsberg
Assistant to the Director of the FDIC (Comptroller of the Currency) Albert J. Faulstich
Director, Bank Organization Division

T. M. Brezinski

Chief Representative in Trusts P. P. Kellogg
Assistant Chief Representative in Trusts R. P. St. Pierre
Special Assistant to the Comptroller (Public Affairs)
Special Assistant to the Comptroller

E. E. Cox

Special Assistant to the Comptroller

W. Robert Grubb

John D. Gwin




53

I X . Income and Expenses of the Office of the
Comptroller of the Currency
This report covers my third full year as Comptroller
of the Currency and the third consecutive year in
which income of this Office has exceeded our expenses.
This is in sharp contrast with the unfavorable 1957-61
trend of substantial equity erosion.
In 1963, the accounting system of this Office was
modernized. A modified accrual system, in conformity with generally accepted accounting principles, was
established. The move from a cash basis to our present accrual method required that we adjust the pre1963 financial statements for comparison purposes.

A. Income for 7964
Total income for 1964 was up $1,056,041 over 1963,
an increase of 6.3 percent. The major portion of this
increase is attributable to Assessment and Trust Examination income.
Assessment income rose $955,138, or 6.7 percent,
during 1964, reflecting an increase in the number of
national banks and substantial growth of assets in those
banks previously in the national system. Trust departments under the supervision of this Office similarly
experienced an appreciable expansion. This growth,
coupled with the considerably increased number of
trust departments examined in 1964, resulted in additional revenue from this source of $119,556, or 11.1
percent. Funds derived from application and investigation fees reflected only a moderate gain.
Income from investments for 1964 was up 21.9
percent to a new high of $430,567. This increase was
due principally to a full realization of prior improvements made in the management of our investment
portfolio. Average cash balances were substantially
reduced at that time and maturities scheduled in such
a manner as to maximize the amount of our return.

B. Expenses for 1964
Total expenditures for 1964 show only a moderate
rise of $364,799, 2.3 percent over 1963. This modest
increase vividly illustrates the policy of this Office to
incur additional expenses only when the value to be
derived therefrom is clearly in the interest of a better
National Banking System.
Salaries and related expenses comprise the major
category of increase in expenses over last year. This
growth represents chiefly the implementation of that
54




part of the congressional pay raise granted in 1962
which became effective early in 1964 and the additional pay raise granted by Congress during this past
year.
The total number of employees in this Office declined from 1,538 to 1,531 despite additions to the
Law Department, the Banking and Economic Research Department, and the increased number of
lawyers hired for our trust examination staff. In this
era of increasingly complex banking practices, this Office is successfully continuing to implement a personnel
policy aimed at reducing the number of employees
while acquiring staff members more sophisticated in
their ability to deal with the areas of our concern.
Figures for 1964 indicate an extensive reduction
in per diem allowances with a concomitant increase,
of moderate amount, in travel expenses. This seeming paradox is a reflection of two important factors.
First, several of our subregional field offices were relocated to correspond with population trends. This
strategic placement of offices was then complemented
by a revision in the travel regulations of this Office.
The result was a decrease in both travel and per diem
charges on the part of our examining staff. Second,
increased emphasis was placed on direct communication with bankers both by Washington Office personnel and by Regional Comptrollers. This emphasis on
the freer exchange of ideas and objectives has necessitated increased travel and communication expense
despite the substantially reduced per diem charges.
Publications expense has remained relatively constant in relation to 1963figures,despite the substantial
decrease in income from this source. This fact is
primarily attributable, once again, to our policy of
improving communication v/ith the banking community. Efforts have been intensified to establish a free
flow of information not only to national banks, but to
State bank supervisors and foreign bankers. Today's
complex banking structure requires an extensive communication network. This Office is rising to meet
its obligation to the world financial community as a
source of such vital information.
It is estimated that total income for 1965 will reach
$19,538,500, an increase of $1,611,574. While this is
necessarily an estimate, we believe it to be reasonable.

G. Comptroller's Equity
Continuing deterioration of the Comptrollers equity
due to deficit spending in the 5-year period ending
December 31, 1961, was effectively terminated in 1962.
Since December of 1961, almost $4 million has been
added to the then marginal equity position of this
Office. The total in our equity account is not approaching the goal established in December of 1961,
as a minimum requirement to meet the needs of this
Office in the event it should ever become necessary to

operate for a reasonable period of time without our
normal means of income.

D. Independent Audit
The Audit Staff of the Bureau of Accounts in the
Treasury Department conducted an independent audit
of the financial statements and supporting records of
the Office of the Comptroller of the Currency for
calendar year 1963. The audit was made in accordance with generally accepted auditing standards. A
similar audit for calendar year 1964 is now in progress.

TABLE 13.—Comparative statement of assessment and other operating income, and expenses of the Office of
the Comptroller of the Currency, by calendar years 1958 through 1964
1964

Item

1963

1962

1961

1960

1959

1958

INCOME

'$15, 200, 556i$14, 245,418 $13,289,291 $10,
1,196,574 1, 077,018
953, 889
13,454
16,090
0
!
190.933
166,962
156,116
250.712
243, 899
108,063
i
46,000
47, 500
49, 000
4. 759
4,362
3,324
7,987
'
2.498
2,850
466,120
496'. 330
238, 750
54^ 760
212,683
o
34.125
32,282
0
5, 658
2.588
4,222

Assessments
,
Trust examinations
Trust investigations
Branch investigations.
Charter investigations
Merger and consolidation fees
Affiliate examinations
Extra examinations
Reporting services
Manuals and publications
Currency issue management..
Other

686, 750 $10,213,494 $9, 247, 563 $8, 224, 237
511,121
540, 772
477, 364
422, 046
0
0
0
0
100,230
98,183
86,153
63, 162
37, 732
31,800
25, 469
32, 038
4,000
0
0
0
2,326
2,354
3, 606
2,038
5,537
2,375
9,416
8, 124
86, 768
84, 480
93,110
89, 642
0
0
0
0
0
0
0
0
2,303
966
3,011
732

17,496,359 16 517,772 14,810,642 11, 436, 767 10 974, 424
169,865
216,414
430,567
353,113
172,106

9, 945, 692
155,651

8,842,019
173, 675

1 17,926,926 16 870, 885 14,982,748 i i , 606, 632 11 190,838 10,101,343

Subtotal
Investment income

9,015,694

.

Total

;

EXPENSES

Salaries
: 11,658, 110 10 900, 824 9,490,714
Employer's retirement, insurance
and F.I.C.A. C o n t r i b u t i o n . . . . .
874, 263
818,243
712, 535
Per diem
1,945,213 2 402, 914 2, 174, 488
:
916,573
Travel
708, 776
866, 591
180,069
Rent
186,462
1 90, 477
71, 806
Supplies
65. 284
76, 869
111,272
Printing, books, and periodicals. . . .
311,129
303, 506
Furniture and fixtures.
205, 930
Depreciation
48, 567
31,617
Remodeling
19.663
69, 094
Office machines, rentals, and repairs
13,492
26 868
Communications
128, 558
118,658 " " 118,' 304
Shipping expenses
35, 097
53,106
55, 559
Other
64, 336
69, 933
80, 662
Total

8 192,979

7,511,943

7, 493, 358

645, 641
1, 841,168
654, 657
162,837
30, 544
84,418
31,324

581,450
1 684, 544
577, 362
157,496
27, 268
85, 562
42, 733

509, 768
1,590,753
557, 062
153,333
27, 539
75, 908
26, 864

505, 994
1,597,819
522, 031
142,057
22,236
65, 368
28, 741

74, 449 . . . '74,'284
19,346
24, 814
38, 904
49,411

72, 820
21,379
37, 681

59, 499
20, 446
21,907

| 16,280,123 15, 915,324 13,910,115 12, 110,424 11 497, 903 10, 585, 050 10,479,456

Net Income ( + ) or Loss (—-). . 1 + 1, 646, 803 + 955,561 + 1, 072, 633




8, 527,136

- 503, 792

— 307, 065

—483, 707 — 1,463,762

55

TABLE 14.—Comparative statement of financial operations of the Office of the Comptroller of the Currency,
by calendar years 1958 through 1964
Item
W

^

7964

7963

7962

7967

7960

7959

7958

ASSETS

Current assets:
Gash on hand and on deposit. . . $603, 988
Accounts receivable
11,885
Investments
8,571,481
Accrued interest receivable
88,715
Prepaid expenses
10, 646
Total current assets
Fixed assets:
Furniture, fixtures, and equipment
Less: accumulated depreciation .
Total fixed assets
Total assets

$350, 295 $1,225,955
125,454
89, 912
7,139,008 5, 542, 450
30, 479
83,018
527
4,716

$812,139
47,148
4, 748, 866
24, 543
2,404

$957, 281 $1,125,864
45,715
57, 826
5, 098, 809 5, 035,126
56, 047
75,106
4,441
0

$747,272
47,151
5, 951, 940
44, 968
0

9,286,715

7, 702, 491

6, 889, 323

5, 635,100

6,162,293

6, 293, 922

6,791,331

524, 621
90, 481

426,475
41,914

0
0

0
0

0
0

0
0

0
0

434, 140

384, 561

0

0

0

0

0

9, 720, 855

8, 087, 052

6, 889, 323

5,635,100

6,162,293

6, 293, 922

6,791,331

LIABILITIES

Current liabilities:
Accounts payable
Accrued payroll
Payroll deductions for bonds and
taxes, etc
Accrued travel expenses
Deferred income

390
435, 059

117,961
314,611

119,209
260, 959

49, 000
179, 732

41,760
175,690

43,157
123, 008

32, 000
94, 000

43, 937
209, 000
10,202

38, 554
209, 527
6, 154

38,161
190,268
0

31, 557
215,000
0

44, 473
191,636
0

45, 317
165, 000
0

36, 828
176, 000
0

Total current liabilities

699, 038

686, 807

608, 597

475, 289

453, 559

376, 482

338, 828

Other liabilities:
Closed receivership trust funds. . 2, 697, 942
Employees accumulated annual
leave
1,050,564

2, 702, 902

2, 687, 754

2, 692, 094

2,695,165

2, 648, 206

2, 657, 362

1,070,836

1,117,659

1, 062, 940

1,105,000

1,054,000

1, 095, 000

3, 748, 506

3, 773, 738

3, 805, 413

3, 755, 034

3,800,165

3, 702, 206

3, 752, 362

4} 447} 544

4, 460, 545

4,414,010

4,230, 323

43 253, 724

4, 078, 688

4,091,190

5,273,311

3, 626, 507

2, 475, 313

1,404,777

1,908,569

2,215,234

2, 700,141

Total liabilities and equity. . . . 9, 720, 855

8, 087, 052

6, 889, 323

5,635,100

6,162,293

6, 293, 922

6, 791, 331

Total other liabilities
Total liabilities
Equity:

X. Issue and Redemption of Currency
During the year ending December 31, 1964, the
Comptroller made 1,726 shipments of new Federal
Reserve notes (1,457,848,000 notes with an aggregate
value of $8,223,148,000) to Federal Reserve agents.
Delivery of 42,424,000 notes with an aggregate
value of $301,000,000 was made to the Treasurer
of the United States. There were 4,670 shipments of
unfit Federal Reserve notes and Federal Reserve Bank
notes (560,805,402 notes with an aggregate value of
$6,635,091,243) received for verification and certifica56




tion for destruction; 325,390 badly damaged Federal
Reserve notes and Federal Reserve Bank notes with
an aggregate value of $6,429,865 were presented by the
Treasurer of the United States for identification
approval.
The Comptroller also received shipments of National Bank notes (1,767,386 notes with an aggregate value of $14,146,970) for verification and destruction. On December 31, 1964, the value of National Bank notes outstanding was $22,597,493.

APPENDIX A

Merger Decisions, 1964

779-563—65——5




INDEX
Merger1 Decisions, 1964
Page

The Citizens Bank, Westerville, Ohio, and the City
National Bank & Trust Co. of Columbus, Ohio (7621),
which had merged January 2,1964, under the charter
and title of the latter bank (7621)
Traders Bank & Trust Co., Hazleton, Pa., and Northeastern Pennsylvania National Bank & Trust Co.,
Scranton, Pa. (77), which had merged January 3,1964,
under charter of the latter bank (77) and under
title of "Northeastern Pennsylvania National Bank &
Trust Co."
White Haven Savings Bank, White Haven, Pa., was
purchased January 3, 1964, by the First National
Bank of Wilkes-Barre, Wilkes-Barre, Pa. (30)
Texas National Bank of Houston, Houston, Tex.
(10152), and the National Bank of Commerce of
Houston, Houston, Tex. (10225), which had consolidated January 17, 1964, under charter of the latter
bank (10225) and under title "Texas National Bank
of Commerce of Houston."
The Bank of Worcester, Worcester, N.Y., and National
Commercial Bank & Trust Co., Albany, N.Y. (Charter No. 1301), which had merged January 31, 1964,
under the charter and title of the latter bank (1301)..
The Farmers & Merchants National Bank of Williamsburg, Williams burg, Pa. (9392), and the First National
Bank of Claysburg, Claysburg, Pa. (10232), which
had merged January 31, 1964, under charter of the
latter bank (10232) and under title of "The Central
Pennsylvania National Bank of Claysburg"
The First National Bank of Lacona, Lacona, N.Y.
(10175), and the Merchants National Bank & Trust
Co. of Syracuse, Syracuse, N.Y. (1342), which had
merged January 31, 1964, under the charter and title
of the latter bank (1342)
Beaver County Trust Co., New Brighton, Pa., and the
Western Pennsylvania National Bank, McKeesport,
Pa. (2222), which had consolidated February 7, 1964,
under charter and title of the latter bank (2222)
Farmers Bank of Holland, Inc., Holland, Va., and Seaboard Citizens National Bank, Norfolk, Va. (10194),
which had merged February 12, 1964, under the charter and title of the latter bank (10194)
The First National Bank of New Bloomfield, New Bloomfield, Pa. (5133), and the Harrisburg National Bank
& Trust Co., Harrisburg, Pa. (580), which had merged
February 14, 1964, under the charter and title of the
latter (580)
1

62

63
64

65

67

68

69

70

71

72

Includes mergers, consolidations, and purchase and sale
transactions where the emerging bank is a national bank.
Decisions are arranged chronologically by effective date.

58




Security Trust Co., Lynn, Mass, and the Danvers National Bank, Danvers, Mass. (7452), which had consolidated February 21, 1964, under charter of the
latter bank (7452) and under title of "SecurityDanvers National Bank"
Commonwealth Bank & Trust Co., Pittsburgh, Pa., and
the Union National Bank of Pittsburgh, Pittsburgh,
Pa. (705), which had consolidated February 28, 1964,
under charter and title of the latter (705)
First National Bank of Minoa, Minoa, N.Y. (13476),
and Lincoln National Bank & Trust Co. of Central
New York, Syracuse, N.Y. (13393), which had merged
February 28, 1964, under charter and title of the latter
bank (13393)
The First National Bank of Pullman, Pullman, Wash.,
(4699), and Old National Bank of Washington, Spokane, Wash. (4668), which had merged February
28, 1964, under the charter and title of the latter
bank (4668)
The Peoples Bank of Erie County, Hamburg, N.Y., and
Liberty National Bank & Trust Co., Buffalo, N.Y.
(15080), which had merged March 5,1964, under the
charter and title of the latter bank (15080)
Grand Ledge State Bank, Grand Ledge, Mich., and
Loan & Deposit State Bank, Grand Ledge, Mich.,
were purchased March 14, 1964, by Michigan
National Bank, Lansing, Mich. (14032)
The First National Bank of Bicknell, Bicknell, Ind.
(7155), Bicknell Trust & Savings Co., Bicknell, Ind.,
the Citizens State Bank, Bicknell, Ind., and the American National Bank of Vincennes, Vincennes, Ind.
(3864), which had merged March 21, 1964, under
charter and title of the latter bank (3864)
Darlington County Bank & Trust Co., Darlington, S.C.,
and the First National Bank of South Carolina of Columbia, Columbia, S.C. (13720), which had merged
March 31, 1964, under charter and title of the latter
bank (13720)
Southern Bank of Commerce, Danville, Va., and Virginia National Bank, Norfolk, Va. (9885), which had
merged April 3, 1964, under charter and title of the
latter bank (9885)
The First National Bank, of Buena Vista, Buena Vista,
Va., (9890), and Virginia National Bank, Norfolk,
Va. (9885), which had merged April 3, 1964, under
charter and title of the latter bank (9885)
The New Market National Bank, Newmarket, N.H.,
(1330), and the Rockingham National Bank of Exeter,
Exeter, N.H. (12889), which had merged April 3,1964,
under charter and title of the latter bank (12889)

74

75

78

79

80

81

82

84

85

86

88

Page
Delton State Bank, Delton, Mich., was purchased April
18, 1964, by the First National Bank & Trust Go. of
r
Kalamazoo, Kalarnazoo, Mich. (191)
The First National Bank of Sharpsville, Sharpsville,
Pa. (6829), was purchased April 18, 1964, by the
McDowell National Bank of Sharon, Sharon, Pa.
(8764)
The First National Bank of Lebanon, Lebanon, Va.
(6886), and the First National Exchange Bank of
Virginia, Roanoke, Va. (2737), which had merged
April 24, 1964, under charter and title of the latter
bank (2737)
The First National Bank of Richlands, Richlands, Va.
(10850), and the First National Exchange Bank of
Virginia, Roanoke, Va. (2737), which had merged
April 24, 1964, under charter and title of the latter
bank (2737)
The Winchester National Bank, Winchester, N.H.
(887), was purchased April 24, 1964, by the Cheshire
National Bank of Keene, Keene, N.H. (559).
State Bank of Linwood, Linwood, Mich., and Peoples
National Bank & Trust Co. of Bay City, Bay City,
Mich. (14641), which had merged April 25, 1964,
under charter and title of the latter bank (14641)
The Union National Bank of Mahanoy City, Mahanoy
City, Pa. (3997), and the Pennsylvania National Bank
& Trust Co. of Pottsville, Pottsville, Pa. (1663), which
had merged May 8, 1964, under charter and title of
the latter bank (1663)
Bank of Dayton, Dayton, Ind., was purchased May 9,
1964, by Lafavette National Bank, Lafayette, Ind.
(14175)
'
The First National Bank of Blue Ridge Summit, Blue
Ridge Summit, Pa. (12281), and First National Bank
& Trust Co. in Waynesboro, Waynesboro, Pa. (11866),
which had merged May 9, 1964, under the charter and
title of the latter bank (11866)
Cherry Hill National Bank, Cherry Hill, N J . (14936),
and First Camden National Bank & Trust Co.,
Camden, N.J.(1209), which had merged May 15,
1964, under charter and title of the latter bank (1209).
Woodbridge National Bank, Woodbridge, N J . (14378),
and First Bank & Trust Co., National Association,
Fords, N J . (15255), which had merged May 15, 1964,
under the charter and title of the latter bank (15255).
Carolina Bank, Graniteville, S.C., and the Citizens &
Southern National Bank of South Carolina, Charleston, S.C. (14425), which had merged May 23, 1964,
under the charter and title of the latter bank (14425).
Citizens Bank of Darlington, Darlington, S.C, and the
Citizens & Southern National Bank of South Carolina,
Charleston, S.C. (14425), which had merged May
23, 1964, under charter and title of the latter bank
(14425)
The Bank of Rowlaxid, Rowland, N.C., and Southern
National Bank of North Carolina, Lumberton, N.C.
(10610), which had merged May 23, 1964, under
charter and title of the latter bank (10610)
Salmon Falls Bank, Rollinsford, N.H., and the First
National Bank of Somersworth, Somersworth, N.H.
(1180), which had merged May 29, 1964, under the
charter of the latter bank (1180) and under the title
"First Somersworth-Rollinsford National Bank."
Citizens Industrial Bank, Grand Rapids, Mich., was
purchased June 15, 1964, by the Michigan National
Bank, Lansing, Mich. (14032)
The Bank of Endicott, Endicott, Wash., was purchased
June 19, 1964, by the National Bank of Commerce of
Seattle, Seattle, Wash. (4375)
The American National Bank of San Bernardino, San
Bernardino, Calif. (10031), and the Bank of California,
National Association, San Francisco, Calif. (9655),
which had merged June 26, 1964, under charter and
title of the latter bank (9655)




89

90

92
93

94

95
96

97

98

99

101

102

104
105
106

107

The First National Bank of Narrowsburg, Narrowsburg,
N.Y. (12496), and the First National Bank in Callicoon, Callicoon, N.Y. (13590), which had consolidated
June 30,1964, under charter of the latter bank (13590),
and under title of "United National Bank."
The Macungie Bank, Macungie, Pa., and the First
National Bank of Allen town, Allentown, Pa. (373),
which had merged June 30, 1964, under charter and
title of the latter bank (373)
The Peoples National Bank of West Alexander, WTest
Alexander, Pa. (8954), and the First National Bank of
Fredericktown, Fredericktown, Pa. (5920), which had
merged June 30, 1964, under the charter and title of
the latter bank (5920)
Tri-Cities National Bank, Pasco, Wash. (14919), was
purchased June 30, 1964, by Old National Bank of
Washington, Spokane, Spokane, Wash. (4668)
The First National Bank of Hagerman, Hagerman, N.
Mex. (7503), was purchased July 17,1964, by the First
National Bank of Roswell, Roswell, N. Mex. (5220)..
Allegan State Bank, Allegan, Mich., and the First National Bank & Trust Co. of Kalamazoo, Kalamazoo,
Mich. (191), which had merged July 18, 1964, under
the charter and title of the latter bank (191)
National Bank of Commerce of Chicago, Chicago, 111.
(14349), and Central National Bank in Chicago, Chicago, 111. (14362), which had merged July 18, 1964,
under the charter and title of the latter bank (14362). .
The Community Bank, Dayton, Ohio, and the National
Bank of Dayton, Dayton, Ohio (1788), which had
merged July 18, 1964, under the charter and title of
the latter bank (1788)
Fair Lawn-Radburn Trust Co., Fair Lawn, N.J., and
National Community Bank of Rutherford, Rutherford, N J . (5005), which had merged July 31, 1964,
under the charter and title of the latter bank (5005). .
Industrial City Bank & Trust'Co., Worcester, Mass., and
the Mechanics National Bank of Worcester, Worcester, Mass. (1135), which had merged July 31, 1964,
under the charter and title of the latter bank (1135). .
The First National Bank of Waynesboro, Waynesboro,
Va. (7587), and First & Merchants National Bank,
Richmond, Va. (1111), which had merged July 31,
1964, under the charter and title of the latter bank
(1111)
The First National Bank of Wise, Wise, Va. (10611),
and the First National Bank of Norton, Norton, Va.
(6235), which had consolidated July 31, 1964, under
the charter of the latter bank (6235) and under title
"The Wise County National Bank."
The Peoples-Farmers National Bank, Mifflin, Pa., Mifflin, Pa. (9678), and the Russell National Bank of
Lewistown, Lewistown, Pa. (10506), which had
merged July 31, 1964, under the charter of the latter
bank (10506) and title "The Russell National Bank.".
The Peoples National Bank of Rock Hill, Rock Hill,
S.C. (9407), and the Citizens & Southern National
Bank of South Carolina, Charleston, S.C. (14425),
which had merged August 1, 1964, under the charter
and title of the latter bank (14425)
The Ashland National Bank, Ashland, Pa. (5615), and
Pennsylvania National Bank & Trust Co., Pottsville,
Pa. (1663), which had merged August 7, 1964, under
charter and title of the latter bank (1663)
The First National Bank of Mount Holly Springs, Mount
Holly Springs, Pa. (8493), and Cumberland County
National Bank & Trust Co., New Cumberland, Pa.
(14542), which had merged August 7, 1964, under
the charter and title of the latter bank (14542)
The First National Bank of West Middlesex, West Middlesex, Pa. (6913), and First National Bank of Mercer
County, Greenville, Pa. (249), which had merged
August 8, 1964, under the charter and title of the
latter bank (249)

109

110

Ill
112
113

114

116

117

118

119

120

121

122

123

125

126

127

59

Page
State Bank of Nappanee, Nappanee, Ind., and the First
National Bank of Elkhart, Elkhart, Ind. (206), which
had merged August 15, 1964, under the charter of the
First National Bank of Elkhart (206) and title "The
First National Bank of Elkhart County"
128
The Nashville Bank & Trust Co., Nashville, Tenn., and
Third National Bank in Nashville, Nashville, Tenn.
(13103), which had merged August 18, 1964, under
the charter and title of the latter bank (13103)
129
The Farmers Bank, Kendrick, Idaho, was purchased
August 21, 1964, by First Security Bank of Idaho,
National Association, Boise, Idaho (14444)
132
The Georgetown National Bank, Georgetown, Ky.
(8579), and First National Bank & Trust Co., Georgetown, Ky. (2927), which had merged August 29, 1964,
under the charter of the latter bank (2927), and under
the title "First Georgetown National Bank and Trust
Company"
133
Pocatello National Bank, Pocatello, Idaho (14859),
and the Idaho First National Bank, Boise, Idaho
(1668), which had merged September 4, 1964, under
charter and title of the latter bank (1668)
135
Peoples Bank of Stuarts Draft, Inc., Stuarts Draft, Va.,
and National Bank & Trust Co., at Charlottesville,
Charlottesville, Va. (10618), which had merged September 30, 1964, under charter of the latter bank
(10618) and title "National Bank and Trust Company"
136
The Branford Trust Co., Branford, Conn., and the
First New Haven National Bank, New Haven, Conn.
(2), which had merged September 30, 1964, under
charter and title of the latter bank (2)
137
Spokane National Bank, Spokane, Wash. (14866), and
National Bank of Washington, Tacoma, Washington,
(3417), which bad merged October 2, 1964, under
charter and title of the latter bank (3417)
138
The Citizens National Bank of Corry, Corry, Pa. (4479),
and the Marine National Bank of Erie, Erie, Pa. (870),
which had merged October 2, 1964, under charter
of the latter bank (870), and with the title "Marine
National Bank"
139
The Citizens National Bank & Trust Co. of Oneonta,
Oneonta, N.Y. (8920), and National Commercial
Bank & Trust Co., Albany, N.Y. (1301), which had
merged October 2, 1964, under charter and title of
the latter bank (1301)
140
Citizens National Bank of Beaver Falls, Beaver Falls, Pa.
(14764), and Western Pennsylvania National Bank,
McKeesport, Pa. (2222), which had consolidated
October 3, 1964, under charter and title of the latter
bank (2222)
141
Community National Bank, Liberty, N.Y. (10037), and
Marine Midland National Bank of Southeastern New
York, Poughkeepsie, N.Y. (465), which had merged
October 9, 1964, under charter and title of the latter
bank (465)
142
Tennessee Bank & Trust Co., Houston, Tex., and
Houston National Bank, Houston, Tex. (9353), which
had merged October 16, 1964, under charter and
title of the latter bank (9353)
144

60




The Citizens National Bank of Poland, Poland, N.Y.
(9804), and the Oneida National Bank & Trust Co. of
Central New York, Utica, N.Y. (1392), which had
merged October 16,1964, under charter and title of the
latter bank (1392)
Marshall County Bank, Moundsville, W. Va., and First
National Bank at Moundsville, Moundsville, W. Va.
(14142), which had merged October 17, 1964, under
charter and title of the latter bank (14142)
First Security Bank of Twin Falls, Twin Falls, Idaho,
and First Security Bank of Idaho, National Association, Boise, Idaho (14444), which had merged October 23, 1964, under charter and title of the latter
bank (14444)
The Bank of Appomattox, Appomattox, Va., and the
Fidelity National Bank, Lynchburg, Va. (1522), which
had merged October 24, 1964, under charter and
title of the latter bank (1522)
The Christiana National Bank, Christiana, Pa. (7078),
and Lancaster County Farmers National Bank,
Lancaster, Pa. (683), which had merged October 27,
1964, under charter and title of the latter bank (683).
Calhoun State Bank, Homer, Mich., and City Bank &
Trust Co., National Association, Jackson, Mich.
(15367), which had consolidated November 5, 1964,
under charter and title of the latter bank (15367)
The Cargill Trust Co., Putnam, Conn., and Hartford
National Bank & Trust Co., Hartford, Conn. (1338),
which had merged November 10, 1964, under charter and title of the latter bank (1338)
The Guilford Trust Co., Guilford, Conn., and the
Second National Bank of New Haven, New Haven,
Conn. (227), which had merged November 16, 1964,
under charter and title of the latter bank (227)
Citizens State Bank, Aliquippa, Pa., and Western Pennsylvania National Bank, McKeesport, Pa. (2222),
which had merged November 21, 1964, under the
charter and title of the latter bank (2222)
The National Bank of Lake Ronkonkoma, Lake Ronkonkoma, N.Y. (13130), and the Peoples National
Bank of Long Island, Patchogue, N.Y. (12788),
which had merged December 4, 1964, under the
charter and title of the latter bank (12788)
Hightstown Trust Co., East Windsor Township, N.J.,
and First Trenton National Bank, Trenton, N.J.
(1327), which had merged December 11, 1964, under
the charter and title of the latter bank (1327)
The First National Bank of Barnesboro, Barnesboro,
Pa. (5818), was purchased December 12, 1964, by
the First National Bank of Ebensburg, Ebensburg,
Pa. (5084)
First National Bank & Trust Co. of Hanover, Hanover,
Pa. (187), and National Bank & Trust Co. of Central
Pennsylvania, York, Pa. (694), which had merged
December 14, 1964, under charter and title of the
latter bank (694)
<
;
The Citizens National Bank of Covington, Covington,
Va. (5326), and the First National Exchange Bank
of Virginia, Roanoke, Va. (2737), which had merged
December 15,1964, under the charter and title of the
latter bank (2737)

146

147

148

150

151

152

154

155

156

158

159

159

161

162

The Farmers National Bank of Bloomsburg, Bloomsburg,
Pa. (4543), and Miners National Bank of WilkesBarre, Wilkes-Barre, Pa. (13852), which had merged
December 16, 1964, under charter and title of the
latter bank (13852)
The Pattison National Bank of Elkland, Elkland, Pa,.
(5043), the First National Bank of Knoxville, Knoxville, Pa. (9978), and the Farmers' National Bank of
Liberty, Liberty, Pa. (11127), were purchased December 16, 1964, by the First National Bank of Wellsborough, Wellsboro, Pa. (328).
The Garden State National Bank of Teaneck, Teaneck,
N.J. (12402), and National Community Bank of Rutherford, Rutherford, N.J. (5005), which had merged
December 18, 1964, under the charter and title of the
latter bank (5005)
,
The First National Bank in Gadsden, Gadsen, Ala.
(13728), and State National Bank of Alabama, Decatur,
Ala. (14414), which had merged December 19, 1964,
under charter and title of the latter bank (14414)...




163

164

The Scioto Bank, Commercial Point, Ohio, and the
First National Bank of Circleville, Circleville, Ohio
(118), which had merged December 29, 1964, under
the charter and title of the latter bank (118)
The Commercial National Bank of Spartanburg, Spartanburg, S.C. (14211), and the First National Bank of
South Carolina of Columbia, Columbia, S.C. (13720),
which had merged December 31, 1964, under charter
of The First National Bank of South Carolina of
Columbia (13720), and under title "The First Commercial National Bank of South Carolina"
The Windsor County National Bank of Windsor, Windsor, Vt. (13685), and Vermont National & Savings
Bank, Brattleboro, Brattleboro, Vt. (1430), which had
merged December 31, 1964, under charter of the
latter bank (1430) and title "Vermont National
Bank"

Page

169

170

61

THE CITY NATIONAL BANK & TRUST CO. OF COLUMBUS, COLUMBUS, OHIO, AND THE CITIZENS BANK, WESTERVILLE, OHIO
Banking offices
Total assets

Name of bank and type of transaction

In
operation
The Citizens Bank, Westerville, Ohio, with
and the City National Bank & Trust Co. of Columbus, Columbus, Ohio (7621),
which had
merged Jan. 2,1964, under the charter and title of the latter bank (7621) The
merged bank at the date of merger had

COMPTROLLER'S DECISION

On October 8,1963, the City National Bank & Trust
Co. of Columbus, Columbus, Ohio, and the Citizens
Bank, Westerville, Ohio, applied to the Comptroller of
the Currency for permission to merge under the charter
and with the title of the former.
Columbus, the third largest city in Ohio, is situated
in the center of the State. The 470,000 residents are
supported by a highly industrialized economy consisting of 800 diversified manufacturing plants, 6,500 retail
outlets and 950 wholesale businesses. Additional support is provided by Ohio State University, by a U.S.
Army depot and by the nearby Lockbourne Air Force
Base. Both the economy and the population have
been expanding considerably during the past decade.
Six commercial banks do business within the framework of the expanding Columbus economy. These 6
banks operate 56 offices in the metropolitan area.
Three of them—Ohio National Bank, the Ohio State
Bank, and Worthington Savings Bank—are subsidiaries
of Bane Ohio Corp., a registered bank holding company. The Huntington National Bank and the Brunson Bank & Trust Co. complete the banking structure.
The financial needs of the area are also served by 56
offices of 21 building and loan associations which range
in size from $2 million to $80 million, by 115 credit
unions, 73 sales finance companies and numerous other
lending institutions.
Westerville is situated in the north of Franklin
County about 12 miles from downtown Columbus.
It comprises a part of the northern Columbus metropolitan area and it has experienced an increase in population from 4,100 to 7,000 during the last census period.
The primary force in the economy of Westerville is

62




To be
operated

$9,134,215

2

217,261,957

10

224, 995, 629

12

Otterbein College which, has an enrollment of 1,200
students. Although the Citizens Bank is the only bank
with its headquarters in Westerville, it receives formidable competition from five offices of Bane Ohio
Corp. subsidiaries and from a branch of the Huntington National Bank, all of which are within 4 miles of
Citizens Bank. The nearest office of City National is
its Worthington branch which is about 7 miles southwest. Its other eight branches range from approximately 8 to 19 miles south, southeast, and southwest of
Westerville.
Approval of this merger will enable the resulting
bank to compete more effectively with the much
larger area banks. The expected increase in competition in the banking community will be of substantial benefit to the residents of Westerville.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
it is therefore approved.
DECEMBER 6, 1963.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The area of Franklin County, Ohio, which encompasses greater Columbus is characterized by an extremely high degree of concentration in commercial
banking. Three banking institutions, one of which is
the acquiring bank, control over 97 percent of all deposits and loans in the Franklin County area, the
remaining share is divided among five small banks
among which Citizens Bank is one of the largest. Citizens Bank has not shown that it is unable to continue
to serve the banking needs of Westerville and Gahanna.
For the above reasons, it is believed that the effect of
the proposed merger on competition will be adverse.

TRADERS BANK & TRUST CO., HAZLETON, PA., AND NORTHEASTERN PENNSYLVANIA NATIONAL BANK & TRUST
Co., SCRANTON, PA.
Banking offices
Name of bank and type of transaction

Total assets

Traders Bank & Trust Co., Hazleton, Pa., with
and Northeastern Pennsylvania National Bank & Trust Co., Scranton, Pa.
(77), which had
merged Jan. 3, 1964, under charter of the latter bank (77) and under title of
"Northeastern Pennsylvania National Bank & Trust Go." The merged
bank at the date of merger had
COMPTROLLER'S DECISION

On October 8, 1963, the $172 million Northeastern
Pennsylvania National Bank & Trust Co., Scranton,
Pa., and the $14 million Traders Bank & Trust Co.,
Hazleton, Pa., applied to the Comptroller of the Currency for permission to merge under the charter of the
former and with the title "Northeastern Pennsylvania
National Bank & Trust Co."
Scranton, the seat of Lackawanna County, is the
head office city of Northeastern Pennsylvania National.
Its current population of 111,000 is down from 126,000
in 1950. Lackawanna County, whose declining population is now 234,531, is situated in the northeastern
section of the State in what was at one time the major
anthracite coal mining area in this country. Coal
mining has, however, declined in importance over the
past 30 years. Between 1950 and 1961, employment in anthracite mining in Lackawanna and Luzerne
Counties declined 83 percent while the total population of this area declined about 10 percent. Unemployment has been averaging about 12 percent and
the entire region has been classified as a distressed area.
The population of the three major centers in this
region, Hazleton, Scranton, and Wilkes-Barre, declined
between 1950 and 1960.
Hazleton, the home office city of the single office
Traders Bank, is located about 45 miles south of
Scranton. With a population of 32,000, it is the second largest city in Luzerne County. The economy
of this area, like that of Scranton, has suffered from
the declining importance of mining and processing of
anthracite coal. However, considerable effort has
been made in recent years to attract new industries to
the region. At present, plants producing textiles,
clothing, furniture, electrical components, heating and
air-conditioning equipment, food stuffs, and fabricated
metal products are operating in this region. Nevertheless, it is still classified as a distressed area.




In
operation

To be
operated

$14, 827, 694

1

178,100,427

8

192,928,121

9

Besides its main office, Northeastern operates seven
branches in Lackawanna, Luzerne, and Monroe Counties. This area is also served by 72 other banking
offices whose total deposits and loans aggregate $564.5
million and $344.4 million, respectively. In addition,
25 savings and loan associations with aggregate resources in excess of $160 million compete vigorously for
thrift funds and mortgage loans. Further, the major
banks from New York and Philadelphia vigorously
compete for deposit and loan business in Northeastern's
trade area. Northeastern presently holds but 19 percent of the area's bank deposits and 21 percent of the
loans. After the merger Northeastern will increase its
share of deposits and loans by 2 percent.
At present there appears to be no discernible competition existing between Northeastern and Traders
except in Hazleton where the Traders bank has its sole
banking office and Northeastern has two branches. In
Hazleton, however, there are three other banks ranging in deposits from the $30 million Hazleton National
to the $15.9 million Peoples Savings Bank, thus the
elimination of existing competition there should not
be significantly adverse. With this exception, none of
the other Northeastern banking offices are nearer than
29 miles to Traders whose service area includes 13 other
banks operating 19 offices.
Northeastern's Hazleton branches have felt the lack
of local stockholder support which has been a major
factor preventing them from attaining projected
growth. Traders, whose present officers are advanced
in age, has been unable to provide successor management. The problems of these banks should be eliminated by this merger as Traders has many local
stockholders and Northeastern has management depth
coupled with an aggressive Trust Department so
necessary in commercial banking today.
On balance, in the light of the statutory criteria, we
find this proposal to be in the public interest and the
application is therefore approved.
DECEMBER 23,

1963.
63

SUMMARY OF REPORT BY ATTORNEY GENERAL

The Applicant Bank, with headquarters in the city
of Scranton, has merged four times in the last 8 years
and presently operates eight banking offices in a threecounty service area. With total assets of $ 172,804,000,
total deposits of $150,346,000 and net loans and discounts of $92,282,000, this bank is, with 19 percent
of the "IPC" deposits and 21.12 percent of the total
loans, the largest bank by far in its tricounty service
area. The Applicant Bank also has banking offices in
the city of Hazleton, wherein the Merging Bank is
situated. The latter has total assets of $13,542,000,

total deposits of $12,344,000 and net loans and discounts of $8,407,000.
The instant merger, although not significantly adversely affecting competition in the Applicant Bank's
other service areas, would have significant unfavorable
competitive consequences in the city of Hazleton. It
would add to the competitive difficulties of the remaining local institutions and eliminate the substantial
competition presently existing between the Hazleton
banking offices of the participating banks. Thus, it
is the view of the Department of Justice that the instant
merger would have significant adverse competitive
effects in the city of Hazleton.

THE FIRST NATIONAL BANK OF WILKES-BARRE, WILKES-BARRE, PA., AND WHITE HAVEN SAVINGS BANK, WHITE
HAVEN, PA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

White Haven Savings Bank, White Haven, Pa., with
was purchased Jan. 3, 1964, by the First National Bank of Wilkes-Barre,
Wilkes-Barre, Pa. (30), which had
After the purchase was effected, the receiving bank had

COMPTROLLER'S DECISION

On October 16, 1963, the $81.7 million First National Bank of Wilkes-Barre, Wilkes-Barre, Pa., applied
to the Comptroller of the Currency for permission to
purchase the assets and assume the liabilities of the
$2.9 million White Haven Savings Bank, White Haven,
Pa.
Wilkes-Barre is a city of 64,000 located approximately 120 miles northwest of Philadelphia and about
18 miles southwest of Scranton, in Luzerne County.
With the decline in recent years of anthracite mining,
once the principal industry in the area, the population
of Wilkes-Barre diminished steadily while at the same
time the unemployment rolls continued to increase.
By means of an heroic community effort, the unemployment trend has been slowed, if not halted, and
the economic outlook for the area is more favorable
than at anytime within the past 20 years.
White Haven, population 1,778, lies approximately
18 miles southeast of Wilkes-Barre. Its economy is
dependent mainly upon small manufacturing plants
which tend to stabilize employment. It is also the
southern gateway to the Pocono Mountains where
residential and resort areas are developing rapidly.
64




To be
operated

%2, 920, 000

1

81,722,000
84, 225, 500

6

1

The completion of U.S. Highway 80, now under construction, which will have a major interchange at
White Haven to connect with Pocono Highway 940
and the Northeast Extension of the Pennsylvania Turnpike, will undoubtedly be a stimulus to the economy.
The $12 million School for the Mentally Retarded, to
be located in White Haven, is expected to accommodate 1,280 patients and have a staff of 500 to 600.
Thus, White Haven's prospects for population and
economic growth are decidely promising.
First National operates six offices in Luzerne County
and ranks second among thefivebanks headquartered
in Wilkes-Barre. It assumes third place when consideration is given to the total resources of Northeastern
Pennsylvania National, which has a branch in WilkesBarre. The 15.1 percent of loans and 14.9 percent
of deposits presently held by the purchasing bank will
be increased by the purchase to 15.8 percent and 15.5
percent, respectively. First National will still occupy
second place among Wilkes-Barre banks.
The selling bank operates no branches, does not exercise trust powers, and is the only bank in White Haven,
which it will continue to serve as a branch of First

National. There has been virtually no competition
between the applicants and it would appear that no
competing banks will be adversely affected by this proposal Approval of the purchase will give residents
of White Haven access to a well-staffed trust department. They will also benefit from automated banking
and other services not presently available. Consummation of the transaction will solve a management
succession problem and serve as an instrument of expansion in an area giving every sign of great economic
growth potential.
Applying the applicable statutory criteria, we conclude that the proposal is in the public interest and the
application is therefore approved.
DECEMBER 19, 1963.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed acquisition would not appear to eliminate any significant direct competition between the
participating banks. The service area of First National has been characterized by mergers in recent
years and the three leading banks together control
over 60 percent of deposits and loans. This proposal
would continue that trend toward concentration and
would add to the position of dominance possessed by
First National. The proposal would also tend to
create an imbalance among the remaining banks in
the service area of White Haven by virtue of the entry
of First National by acquisition. To this extent the
probable impact of the proposal would be adverse but
not significantly so.

THE NATIONAL BANK OF COMMERCE OF HOUSTON, HOUSTON, TEX., AND TEXAS NATIONAL BANK OF HOUSTON,
HOUSTON, TEX.
Banking offices
Name of bank and type of transaction

Total assets

Texas National Bank of Houston, Houston, Tex. (10152), with
and the National Bank of Commerce of Houston, Houston, Tex. (10225), which
had
consolidated Jan. 17, 1964, under charter of the latter bank (10225) and under
title "Texas National Bank of Commerce of Houston." The consolidated
bank at the date of consolidation had

COMPTROLLER S DECISION

On September 9, 1963, the $519.9 million National
Bank of Commerce of Houston, Houston, Tex., and
the $340.7 million Texas National Bank of Houston,
Houston, Tex^ applied to the Comptroller of the Currency for permission to consolidate under the charter
of the former and with the title "Texas National Bank
of Commerce of Houston."
Houston, whose 1963 estimated population of over
1 million represents increases of 70.3 percent over 1950
and 57.4 percent over 1960, is the sixth largest city
in the United States and is the largest in the southwestern States of Texas, Oklahoma, New Mexico, and
Arizona. Its standard metropolitan area is defined as
Harris County, an area of 1,730 square miles with a
population of 1.3 million. Houston is the center of
what is known as the Upper Texas Gulf Coast area,
which consists of 11 counties whose 1960 population
was almost 2 million. This trade area runs approximately 21 miles north, 57 miles south, 100 miles east,
and 86 miles west of Houston.




In
operation

To be
operated

$322, 646, 899

1

503, 743, 098

1

826, 389, 997

1

Since 1950, the Upper Texas Gulf Coast area has
nearly doubled its population, and has undergone a
significant change in its economy which 10 years ago
was primarily agricultural. Today, this region boasts
the largest concentration of oil, gas and petrochemical
refining, processing and manufacturing plants in the
world, and is one of the fastest growing industrial
areas of the Nation. It is served by six deep water
ports which are connected by the Inter-Coastal Waterways. The largest of the six is the port of Houston,
connected to the Gulf by a 50-mile ship channel. In
1950 the Port of Houston moved 41.9 million net tons;
in 1962 that figure reached 57.8 million, thus making
the Port the third largest in the country in terms of
tonnage moved.
Three hundred national firms have offices or outlets in downtown Houston, and within the city's corporate limits are 115 firms which employ more than
300 people each. Twenty-five of them employ more
than 1,000 persons. Along with its population boom,
retail sales in the city have increased by 50 percent to
65

a total of $1.5 billion in 1962. Adding to the already
booming economy is the 2-year-old National Aeronautics and Space Administration's Manned Spacecraft Center, located 22 miles from Houston. Ten
colleges in the area have a student enrollment of
23,669, the largest being the University of Houston,
with 13,665 students.
The banking needs of this burgeoning economy are
presently served by 136 commercial banks, 14 of which
are in downtown Houston, 46 in other sections of the
city, 21 in Harris County and the remainder scattered
throughout the trade area. These banks hold a total
of $3 billion in deposits and $2 billion in loans. Of all
the banks in the Upper Gulf Coast area the largest
is the $881.3 million First City National Bank. The
charter bank is second in size and the $498.3 million Bank of the Southwest, National Association is
third. In fourth place is the consolidating bank. All
the other banks in the trade area are much smaller.
Approval of this application will not change the relative positions of the local banks, except that the consolidating bank, in fourth place, will disappear. The
resulting bank will be an $850 million institution and
will have 19 percent of the deposits and 21 percent of
the loans in the area. It will thus remain behind the
First City National Bank, with the exception of total
loans held. In that area, the resulting bank will be
first.
During the past 10 years the banking structure of
the area has undergone profound changes. Because
of the stringent prohibitions against branch banking by
commercial banks contained in the Texas statutes, the
developing needs of area residents for adequate banking service has been met by an increase in newly chartered banks from 82 to 136. This 65.9 percent increase of banks currently accounts for 13 percent
of total area deposits.
Other nonbanking financial institutions compete
with the Houston commercial banks to a considerable
degree. Forty savings and loan associations have assets of $762 million, withdrawable shares of $642
million and loans of $652 million. These associations
also operate 24 branches, an activity unfortunately
and inequitably prohibited to commercial banks in
Texas. Credit unions number 295 and have $129.7
million in assets. Also competing in the area are 198
life insurance companies and 122 sales finance
companies.
The large and increasing number of national firms
in Houston require large amounts of capital which
the consolidating banks are individually unable to
supply because of their relatively low capacity and
66




lending limits. The result, has been undue reliance on
larger banks in New York, Chicago, and other cities
for larger credits. At present, the charter bank has a
lending limit of $3.2 million while the consolidating
bank has a lending limit of $2.4 million. The resulting bank will have a lending limit of $6 million, which
includes a proposed increase in capital of the charter
bank.
A minimal degree of competition between the consolidating banks will be eliminated by this proposal.
On accounts of more than $10,000, mutual customers
had 104 checking accounts, 117 savings accounts, 14
time deposit accounts, and 40 loan accounts.
It is preeminently clear that banks in every area
must be allowed to expand by whatever routes the law
permits—even the less efficient routes—if they are to
fulfill their responsibility adequately to serve the public's interests and needs.
If banking facilities in Houston and indeed in the
other major metropolitan cities in Texas are to be
adequate in meeting the growing financial needs of
these communities and of the State, bank expansion
is necessary. The Texas legislature has seen fit to
proscribe one essential method of expansion for commercial banks, namely, branch banking, and thus only
the merger route remains.
The resulting bank will offer more effective competition to the larger First City National Bank. The
effect on the smaller banks In the area will clearly not
be adverse.
Having weighed this proposal in light of the statutory
criteria, it is found to be in the public interest and the
application is approved.
JANUARY 13,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

National Bank of Commerce is the second largest
commercial bank in Houston and fourth largest in the
State of Texas, with assets of $519,967,000, deposits of
$476,417,000, loans of $200,776,000 and a substantial
trust business. Texas National Bank is fourth largest
in Houston and eighth in Texas, with assets of
$340,739,000, deposits of $288,925,000, loans of
$166,710,000, and substantial trust accounts. Each
has its main and only office in Houston (under local
law commercial banks are not permitted to establish
branch offices) and each operates in the metropolitan
Houston area, which is roughly coterminous with
Harris County and is the largest single metropolitan
area in the State.
National Bank of Commerce accounts for 14.2 percent of the deposits of individuals, partnerships, and

corporations in the area and 14 percent of loans.
Texas National has 9.6 percent of deposits and 11.7
percent of total loans. After the consolidation the resulting bank, with 23 9 percent of deposits and 25.7
percent of loans, would be about the size of the largest
bank in Houston, First City National Bank, 1.7 times
the size of the third largest institution, Bank of the
Southwest, N.A., and about 10 times the size of what
would then be the fourth largest bank. Concentration
of banking resources in the city's three largest banks
would be increased from 53.2 percent of deposits and

52 percent of loans to 62.8 percent and 63.7 percent,
respectively, and the number of the more substantial
banks in the area would be reduced from four to three.
We conclude that the proposed consolidation would
eliminate a substantial volume of direct competition
between the participating banks and result in a very
significant increase in concentration of resources in a
small number of the largest banks in the area. Accordingly, it is our opinion that the consolidation would
have a serious adverse effect upon competition.

THE BANK OF WORCESTER, WORCESTER, N.Y., AND THE NATIONAL COMMERCIAL BANK & TRUST CO., ALBANY,

N.Y.
Banking offices
Name of bank and type of transaction

Total assets

The Bank of Worcester, Worcester, N.Y. with
and National Commercial Bank & Trust Co., Albany,N.Y. (1301), which had . .
merged Jan. 31, 1964, under the charter and title of the latter bank (1301).
The merged bank at the date of merger had
COMPTROLLER S DECISION

On October 24, 1963, the $436 million National
Commercial Bank & Trust Co., Albany, N.Y., and the
$2.9 million Bank of Worcester, Worcester, N.Y., applied to the Comptroller of the Currency for permission to merge under the charter and title of the
former.
Albany, the State capital, has a population of 130,000 and serves a trade area of over 750,000 located
within a radius of 50 miles. Many diversified industries provide employment and there has been increased
employment in Federal and State Government service,
education and research, and development functions.
Worcester, N.Y., population approximately 1,100,
is situated 60 miles southwest of Albany. The local
economy is primarily agricultural with dairy farming
playing the major role. It has shown little growth
in recent years.
The National Commercial Bank & Trust Co. was
organized in 1825. It presently operates 35 branches
throughout a large part of northeastern New York. It
is the fifth largest commercial bank in New York
State outside metropolitan New York City and the
second largest in the service area. Its management is
capable and well experienced and is supported by a
large and competent staff. Over the years National
Commercial has developed an agricultural department




$2,928,713
460,275,112
463, 049, 981

In
operation

To be
operated

36
37

staffed by specialists. They have been helpful to
farmers both in a technical advisory capacity and in
the development and analysis of their financial needs.
The single office Bank of Worcester was organized
under a State charter in 1884, and has participated in
no mergers or consolidations. It is a small country
bank which has enjoyed limited growth due to its
geographic location and lack of aggressiveness. While
the condition of the bank is good, it now faces a management problem stemming from the recent death of
its vice president and cashier and from its inability to
attract young new officers and directors to the bank.
Active competition in the Albany service area is
provided by seven commercial banks, one of which
is the State Bank of Albany with total resources of
$516 million. Very active competition for deposits
and mortgages is also provided by seven mutual savings banks and seven savings and loan associations in
the Albany area. The addition of the relatively minor
amount of deposits from the merging bank to the figures of the charter bank will raise National Commercial's share of the commercial bank deposits in the Albany service area by only 0.3 percent.
Principal competition in the Worcester area is between the merging bank and the $24.9 million Wilber
National Bank, Oneonta, N.Y., through its branch located in Schenevus, N.Y., 5y2 miles from Worcester.
67

Because of the nature of the intervening topography? the relatively small size of the Worcester community, and the distances between offices, no significant competition between the participants exists. The
nearest branches of the charter bank to the merging
bank are Cobleskill, N.Y., 16 miles northeast and
Cooperstown, N.Y., 16 miles northwest.
There is no overlap in the trade area of Albany and
Worcester and no competition will be eliminated by
this merger. The merged bank will be in a position
to offer broader services to the Worcester service area,
among which will be a trust depatment and farm
advisory services. Consummation of the proposal will
solve the existing management problems of the merging bank. The overall effect on the banking structure in that area will be beneficial.
In balancing the factors of this case in light of the
statutory criteria, the application is found to be in the
public interest and is hereby approved.
JANUARY 17,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

National Commercial Bank, with 36 offices, $436,346,000 in total assets and $380,168,000 in total de-

posits, proposes to acquire the Bank of Worcester,
which has one office, located about 50 miles west of
Albany, total assets of $2,910,000 and deposits of
$2,576,000. The charter bank presently has three
branches adjacent to the service area of the merging
bank and within 18 miles of Worcester. National
Commercial and its branches have $115,614 in deposits
and $133,919 in loans from the Worcester area; the
merging bank draws no business from the service areas
of the charter bank's adjacent branches. The competition eliminated by the acquisition would therefore
not be substantial. But the acquisition would eliminate the only existing independent competitor in the
Worcester area and would serve to enhance the charter bank's present dominant position in the region
generally.
The proposed acquisition is one more of a series
proposed or consummated in recent years in this region
by large Albany banks, and indicates a pattern of activity which appears to threaten the existence of local
banks in the region and to this extent may be adverse
competitively.

FARMERS & MERCHANTS NATIONAL BANK OF WILLIAMSBURG, WILLIAMSBURG, PA., AND THE FIRST NATIONAL
BANK OF CLAYSBURG, CLAYSBURG, PA.
Banking offices
Name of bank and type of transaction

Total assets

To be
operated

operation
The Farmers & Merchants National Bank of Williamsburg, Williamsburg, Pa.
(9392), with
and the First National Bank of Claysburg, Claysburg, Pa, (10232), which had. .
merged Jan. 31, 1964, under charter of the latter bank (10232) and under
title of "The Central Pennsylvania National Bank of Claysburg." The
merged bank at the date of merger had
COMPTROLLER'S DECISION

On November 19, 1963, the $9.2 million First National Bank of Claysburg, Claysburg, Pa., and the $2
million Farmers & Merchants National Bank of Williamsburg, Pa., applied to the Comptroller of the Currency for permission to merge under the charter of the
former and with the title "The Central Pennsylvania
National Bank of Claysburg."
The applicant banks are located in Blair County in
central Pennsylvania. The only arable land in this
rugged, hilly area lies in the southern portion of the
county. Both Claysburg and Duncansville, where the
charter bank has a branch, have populations of about
68




$2, 003, 046
9, 229, 370
11,232,417

1
2
3

1,400. Their combined trade area population totals
about 15,000. While the area is now depressed, its
economic development program has met with some
success in the Duncansville area where industrial plants
provide the chief source of employment. In addition,
many residents of these communities work in Altoona,
the principal city in the county.
Williamsburg, partially isolated from the rest of the
county by the rough terrain, is located about 15 miles
east of Duncansville and 24 miles northeast of Claysburg. Basically a residential community with one
small retail business district, its principal industries are
a paper mill and an electric generating plant. The

surrounding area adds 2,500 more people to the town's
trading area.
In the general area served by the charter bank and
its branch are four offices of three other competing
banks: the $10.5 million Holidaysburg Trust Co., the
$31 million First National Bank of Altoona, and the
$43.5 million Altoona Trust Co. The merging bank,
the smallest in the county, has no branches. Its only
direct competitor is a branch of the Holidaysburg
Trust Co. in Williamsburg. Due to its location, the
merging bank does not compete with the charter bank.
Approval of the proposed merger will be of substantial benefit to the two banks and to the communities they serve. Considering the banks with which
the charter and merging banks compete, the applicants
rank next to last and last in both total loans and
deposits. Although the resulting bank will still be
the smallest of the four in the area, it will be in a better
position to compete effectively with the other three
larger banks, both through an increased legal lending limit and through the opportunity to offer trust
facilities and other specialized services, to provide more
efficient bank management, and to automate some
of its operations. Approval of the application will in
no way affect the competitive situation between the
Claysburg and Duncansville communities and the Wil-

liamsburg community since deposits and loans originating in each other's communities are negligible.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and
the application is therefore approved.
JANUARY 20, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

There does not appear to be any significant amount
of competition between these banks that would be
eliminated by the proposed merger. It would, however, eliminate the last independent bank in the Resulting Bank's service area, an area characterized by a
high degree of concentration and several recent mergers and acquisitions by the three leading banks
therein.
On the other hand, neither the charter nor merging bank has participated in any mergers or acquisitions. In addition, the merging bank faces the competition of a much larger bank in its service area.
Furthermore, the charter bank is the smallest bank
in its service area and its position therein would not be
materially enhanced by this merger. It would thus
appear that the effect of this merger on competition
will not be substantially adverse.

THE FIRST NATIONAL BANK OF LACONA, LACONA, N.Y., AND THE MERCHANTS NATIONAL BANK & TRUST CO.
OF SYRACUSE, SYRACUSE, N.Y.
Banking offices
Total assets

Name of bank and type of transaction

In
operation
The First National Bank of Lacona, Lacona, N.Y. (10175), with
and the Merchants National Bank & Trust Co. of Syracuse, Syracuse, N.Y.
(1342), which had
merged Jan. 31,1964, under the charter and title of the latter bank (1342). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On November 26:, 1963, the $127.7 million Merchants National Bank & Trust Co. of Syracuse, Syracuse, N.Y., and the $3.4 million First National Bank
of Lacona, Lacona, N.Y., applied to the Comptroller
of the Currency for permission to merge under the
charter and with the title of the former.
Syracuse, population 215,000, is the fourth largest
city in New York and the seat of Onondaga County.
Serving a trade area of about 1 million persons, the
city is a major distribution point for central New York




To be
operated

$3, 407, 107

1

129, 903, 495

14

133, 304,140

15

and a commercial center with about 400 diversified
companies.
Lacona, population 446, is located approximately 45
miles north of Syracuse. An adjoining village, Sandy
Creek, has a population of about 7,000. The economy of the area is devoted principally to dairy farming and, to some extent, poultry farming. Local industry is limited to a lumber company employing about
50 persons, but many residents of Lacona and the surrounding area are employed in Syracuse and two other
nearby cities.
69

The charter bank, with 13 branches, is the fourth
largest commercial bank in the Syracuse area. It
has 16.94 percent and 18.57 percent, respectively, of
deposits and loans in its service area. A large staff
and aggressive management have developed an active
commercial loan portfolio, large mortgage and consumer credit departments, and a large volume of
trust business.
The merging bank is the only bank in Lacona and
maintains no branches. It has a relatively small volume of consumer loans and the balance of its loan
portfolio consists of commercial loans. The bank's
business is almost entirely derived from Lacona and a
surrounding area of about 10 miles, which has a population of about 8,500. Although management has
been aggressive within the limits of the bank's capabilities, the only fully experienced executive personnel—the chief executive and his principal assistant—
plan to retire in the near future and a management
succession problem is imminent.
The proposed merger will have no adverse effect on
competition. The two banks serve areas which do not
overlap, as the nearest office of the charter bank is 37
miles from the office of the merging bank. The charter bank's competitive position in the Syracuse area
will not be appreciably enhanced due to its small size.
There will be no adverse competitive effects in the
Lacona area because there is no indication that the
three branches of other large banks located in the area
and the main office of a small bank located 16 miles
from Lacona will be unable to compete effectively with
the resulting bank. On the contrary, the merger

portends healthy competition in the merging bank's
trade area by introducing the services of another large
and aggressive institution, able and willing to supply
all banking functions.
By providing broader banking services to the Lacona
service area, the merger will serve the needs and convenience of the banking public. The charter bank's
management is experienced in all phases of branch
operations and will especially serve the Lacona public
by its familiarity with agricultural financing.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the
application is therefore approved.
JANUARY 24,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Merchants National is the smallest of four banks
located in Syracuse, N.Y., and would remain so following the proposed merger. It would then possess
17.75 percent of the deposits and 19.44 percent of the
loans held by all such banks.
The head offices t>f the merging banks are located
approximately 45 miles apart and it would appear that
little, if any, direct competition would be eliminated
by their merger.
The only other bank competing in First National's
service area is a branch of a Syracuse bank which is
larger than the two merging banks combined and
would not appear to be adversely affected by the
merger.
It is our conclusion that the proposed merger would
not adversely affect banking competition in any of the
service areas involved.

WESTERN PENNSYLVANIA NATIONAL BANK, MCKEESPORT, PA., AND
BEAVER COUNTY TRUST CO., NEW BRIGHTON, PA.
Banking offices
Name of bank and type of transaction

Total assets
To be
operated

In
operation
Beaver County Trust Co., New Brighton, Pa., with
and the Western Pennsylvania National Bank, McKeesport, Pa. (2222),
which had
consolidated Feb. 7,1964, under charter and title of the latter bank (2222).
The consolidated bank at the date of consolidation had

COMPTROLLER'S DECISION

On November 26, 1963, the $556.7 million Western
Pennsylvania National Bank, McKeesport, Pa., and
the $8.6 million Beaver County Trust Co., New Brigh70




$8, 205,160

1

542, 121, 391

43

548, 912, 688

44

ton, Pa., applied to the Comptroller of the Currency
for permission to consolidate under the charter and
title of the former.
McKeesport, a city of 46,000, is situated 11 miles
southeast of Pittsburgh in Allegheny County and is

considered part of the Pittsburgh standard metropolitan area, a highly industrialized region with the
principal industries being iron, steel, and related lines.
New Brighton, a community of 8,397, is located 47
miles northwest of McKeesport and 30 miles west of
Pittsburgh in Beaver County. It is in the heart of
the industrial Beaver Valley whose economy is mainly
dependent upon steel and related industries. Located
in New Brighton and directly across the Allegheny
River, in Beaver Falls, are 18 manufacturing corporations employing 5,600 workers.
The Western Pennsylvania National Bank, although
headquartered in McKeesport, is considered a Pittsburgh bank as its service area includes all of Allegheny
County, whose population is 1,665,000. It ranks third
in size in the Pittsburgh metropolitan area, behind
Mellon National and Pittsburgh National. The consolidation will have little competitive effect in Allegheny County where Western Pennsylvania's share of
county deposits will be increased less than 1 percent.
Since Western Pennsylvania's nearest branch office
is 12 miles from New Brighton and outside the merging
bank's trade area, the consolidation will not eliminate
any significant competition now existing between them.
As there are nine other banks in the New Brighton
service area, including branch offices of the large
Pittsburgh banks, competition will not be significantly
affected by this consolidation. Both Mellon National
and the Union National Bank of Pittsburgh operate
branch offices within 1.5 miles of the Beaver County
Trust Co.
The public interest will be served by a local banking unit of Western Pennsylvania which will be able
to furnish the New Brighton banking public with aggressively competitive management. The resulting

local banking unit in New Brighton will have a greatly
enlarged lending capacity, thereby increasing its utility
to the business community. In addition, a serious
management succession problem will be solved.
Considered in light of the statutory criteria, we
find the application to be in the public interest and
the consolidation is therefore approved.
JANUARY 24, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Commercial banking in the Pittsburgh (Allegheny
County) area, the primary service area of the Western
Pennsylvania National Bank, is highly concentrated,
to a large extent as the result of past acquisitions and
mergers by the leading banks therein. Western itself
is the third largest bank serving the Pittsburgh area
and has, since 1953, acquired 19 small- and mediumsized banks, most of them in Allegheny County. Approval of the instant consolidation would further an
existing tendency toward monopoly and might adversely affect potential competition, even though it
would not eliminate any substantial presently existing
competition between Western and Beaver Trust.
As a result of this transaction, the small local banks
operating in the service area of Beaver Trust will face
the competition of another giant bank in addition to
the branches of Pittsburgh's largest and fourth largest
banks already there—Mellon National Bank & Trust
Co. and the Union National Bank of Pittsburgh.
This situation may impose on these small banks a
handicap similar to that alleged in the application as
being one of the reasons for Beaver Trust's interest in
consolidating with Western.
In all respects, therefore, the effect of this proposed
consolidation upon competition must be deemed to
be adverse.

THE SEABOARD CITIZENS NATIONAL BANK OF NORFOLK, NORFOLK, VA., AND THE FARMERS BANK OF HOLLAND,
INC., HOLLAND, VA.
Banking offices
Name of bank and type of transaction

Tote / assets
In
operation

Farmers Bank of Holland, Inc., Holland, Va., with
and Seaboard Citizens National Bank, Norfolk, Va. (10194), which had. . . .
merged Feb. 12, 1964, under the charter and title of the latter bank (10194). .
The merged bank at the date of merger had
COMPTROLLER S DECISION

On November 27, 1963, the $90 million Seaboard
Citizens National Bank of Norfolk, Norfolk, Va., and




$2 ,876, 157
103 ,615, 510
106 ,102, 722

To be
operated
1
9
10

the $2.5 million Farmers Bank of Holland, Inc., Holland, Va., applied to the Comptroller of the Currency
for permission to merge under the charter and title of
the former.
71

Norfolk's major source of employment comes from
the Navy which contributed more than $430 million
in payrolls during 1961. The area is also one of the
State's leading industrial centers with more than 330
manufacturing establishments in the area. The value
of products manufactured in 1960 was $468 million
with capital expenditures in excess of $7 million.
Retail sales amounted to $563 million in 1960 from
over 4,000 establishments.
Nansemond County, service area of the merging
bank, is on the outer extremity of the Norfolk metropolitan area and has a combined economic base of
industry and agriculture. In 1958, there were 34
manufacturing, 17 wholesale and 6,361 retail establishments in the county. The agricultural portion of
the economy is predominantly devoted to the production of peanuts, while other farming operations include
the raising of corn, soy beans, hogs, and beef cattle.
Situated only 29 miles southwest of Norfolk, with
many of its residents employed in industrial plants
there, Holland shares in the general economic growth
of the Norfolk area.
The Seaboard Citizens National Bank is the seventh
largest in the State and the second largest in the Norfolk area. It is far smaller than the $343 million Virginia National Bank which operates a branch in
Suffolk only 11 miles from the merging bank. The
merger of the Farmers Bank of Holland into Seaboard
Citizens will not change the relevant standings of banks
in the area, nor will it have any significant effect on
the competitive climate. There will still be 10 banking
offices within an 11-mile radius of Holland. There
is no direct competition between the merging and
merged banks and the addition of the Farmer's Bank
assets will add only 0.3 percent to Seaboard's proportionate holdings of I PC deposits and loans.
The proposal will offer to citizens of the Holland
area the full services of a commercial bank, something

which the merging bank was not able to do. It will
offer increased lending limits to industry in the area,
which up to now had to go outside of the community
for their larger loans. It will also relieve a serious
management deficiency problem by adding the depth
and quality of the Seaboard management to the personnel now present in the Farmers Bank. In general,
the merged bank will give to the citizens of Holland
a sound, competitive, complete alternate banking
facility.
Applying the statutory criteria to the proposed
merger we conclude it is in the public interest, and the
application is therefore approved.
JANUARY 24,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The Seaboard Citizens National Bank of Norfolk
had total assets of $105,611,000 as of October 31,1963.
The Farmers Bank of Holland, Inc., is located in Holland, a town 29 miles southwest of Norfolk. As of
October 13, 1963, it had total assets of $2,532,000.
Each of the eight banks operating in the service area
of Farmers Bank were independent banks in December of 1962. Should this application be approved and
the pending application of Virginia National Bank to
merge Tidewater Bank & Trust Co. be approved, only
three of these eight banks will remain independent,
the other five having either been merged by a much
larger bank or absorbed by a bank holding company.
These three remaining independent banks, already
operating at a competitive disadvantage with the
existing larger banks in the service area, will be faced
with competition from still another much larger bank.
It is our view that the effect of the proposed merger
on competition, standing alone, would not have a
significant adverse effect. However, it is part of a
trend that threatens the existence of smaller banks in
Virginia and in the Suffolk area in particular.

HARRISBURG NATIONAL BANK & TRUST C O . , HARRISBURG, P A . , AND THE FIRST NATIONAL BANK OF N E W
BLOOMFIELD, N E W BLOOMFIELD, P A .
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The First National Bank of New Bloomfield, New Bloomfield, Pa. (5133), with. . .
and the Harrisburg National Bank & Trust Co., Harrisburg, Pa. (580), which
had..
merged Feb. 14, 1964, under the charter and title of the latter (580). The
merged bank at the date of merger had

72




$4, 847, 238
117,908,599
122, 755, 833

To be
operated
1
9
10

COMPTROLLERS DECISION

On December 2, 1963, the $126 million Harrisburg
National Bank & Trust Co., Harrisburg, Pa., and the
$4.6 million First National Bank of New Bioomneld,
New Bloomfield, Pa., applied to the Comptroller of
the Currency for permission to merge under the charter
and title of the former.
Harrisburg, a city of 79,697, is located in south central Pennsylvania on the Susquehanna River. As the
State capital, it provides employment for numerous
State employees, and due to the presence of three army
depots and other Federal Government installations, for
more than 38,000 Federal workers as well. While the
Harrisburg population has declined since the 1950
census, the population of Dauphin County, of which
Harrisburg is the county seat, has increased 11 percent.
The county, as the center of a trading area of about
360,000 people, has substantial industrial activity, primarily in the iron and steel fabricating field, and a
thriving commercial life.
New Bloomfield, the county seat of Perry County,
lies 29 miles northwest of Harrisburg and has a population of about 1,000., Although there is some light
industrial activity, small- to medium-size dairy farming and related agricultural pursuits constitute the
economic base of the area. As Perry County is within
commuting distance of Harrisburg, many of the area's
residents are employed there and in other surrounding
communities. Because of the movement from Harrisburg to the suburbs, the county's population has
increased slightly to 26,582.
Strong competitive factors are present in the region
served by the charter bank. Numerous nonbank
finance institutions, such as insurance companies, credit
unions and finance companies, operate in the trade
area. In Harrisburg three banks, two approximately
equal in size to the charter bank and one smaller, offer
effective competition. Although all of the banks serving the trade area outside Harrisburg are small, each
offers strong competition to the various branches of the
charter bank, and of the two other large banks, located
in Dauphin and surrounding counties.
The merging bank, third largest of eight banks in
Perry County, is a single-office bank. Little com-




petition exists between it and the other banks in the
New Bloomfield area. Local nonbank financial institutions offer services usually available from banks
but not readily available at Perry County banks.
The effect of the proposed merger on competition
in the New Bloomfield area will be beneficial. The
resulting bank will supply aggressive and enlightened
banking by offering trust services, installment loans,
wider mortgage financing and a greatly increased
lending limit. While the resulting bank will be much
larger than any of its competitors in Perry County, the
history of the charter bank's operation indicates that
its policies stimulate rather than suppress competition.
The resulting bank, therefore, should emerge as the
touchstone for intensified competition.
A serious management problem exists in the merging bank since the death of its former president. This
merger will solve the problem.
Applying the statutory criteria to the proposed
merger we conclude that it is in the public interest
and it is, therefore, approved.
FEBRUARY 12,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The Harrisburg National Bank & Trust Co., which
had deposits of $108,955,000 as of September 30,1963,
has merged eight banks since 1952. These eight banks
had deposits of $72,857,665 at the time they were
merged, which deposits equal about 70 percent of the
present deposits of Harrisburg National.
The First National Bank of New Bloomfield with
deposits of $4,135,000 presently competes with seven
banks, two of which are about the same size as First
National of New Bloomfield and the rest smaller.
Should this proposed merger be approved, these banks
will be at a competitive disadvantage with a branch of
Harrisburg National with a lending limit of $1 million,
fiduciary powers and modern accounting equipment.
These small banks will undoubtedly seek similar mergers to overcome their competitive handicap and thus
foster the disappearance of additional independent
banks.
It is our view that the effect of this proposed
merger on competition will be adverse.

73

THE DANVERS NATIONAL BANK, DANVERS, MASS., AND THE SECURITY TRUST CO., LYNN, MASS.
Banking offices
Name of bank and type of transaction

Total assets

Security Trust Co., Lynn, Mass., with
and the Danvers National Bank, Danvers, Mass. (7452), which had
consolidated Feb. 21, 1964, under charter of the latter bank (7452) and
under title of "Security-Danvers National Bank." The consolidated bank
at the date of consolidation had

COMPTROLLER'S DECISION

On November 21, 1963, the $9.9 million Danvers
National Bank, Danvers, Mass., and the $30.9 million
Security Trust Co., Lynn, Mass., applied to the Comptroller of the Currency for permission to consolidate
under the charter of the former and with the title,
"The Security-Danvers National Bank."
The applicant banks are located in southern Essex
County, an area north of Boston bordering the Atlantic
Ocean. The economy and transportation facilities of
the area are integrated with metropolitan Boston.
Danvers, a town of about 22,000, is located about 17
miles north of Boston and 6 miles north of Lynn.
While basically residential, it has a great deal of industrial activity and has been rapidly expanding both
in population and industrial activity over the past 10
years.
Lynn, with a population of about 94,000, is located
11 miles north of Boston. Once the leading shoe manufacturing center in the United States, it is now a diversified industrial center. In 1961 its 2,030 firms,
predominantly manufacturing in nature, had an
annual payroll of $200.6 million and employed 38,465
persons. While there has been a substantial residential
movement to the suburbs and a concurrent commercial and industry migration, the urban redevelopment plan and the efforts to attract new industry to
Lynn forecast an upturn in the community's economy.
Strong competitive factors exist in the communities served by the charter and consolidating banks.
Not only are 15 commercial banks located there,
but also 10 savings banks, 5 cooperative banks, and a
number of nonbanking finance offices have offices
in the area. Other competition is offered by the large
Boston banks which advertise extensively in the applicants' communities.
In the Danvers area the potential market for loans
exceeds the availability of the loanable funds of the
charter bank, and this limitation handicaps the bank's
74




$29, 783., 695
9, 477, 099

In
operation

To be
operated
3
4

39, 260, 794

7

efforts to serve its area fully. The charter bank also
lacks trust powers. In Lynn, however, growth has
slowed so as to compel the consolidating bank to find
new outlets for its funds. At the same time, the bank's
efforts to expand its facilities and services by branching
outside of Lynn into areas where growth potential exists
have been unsuccessful.
Consolidation will result in a broader based, better
balanced institution that will more effectively serve
the convenience and needs of the communities. Each
bank can supply what the other lacks, the consolidating
bank supplying the sorely needed additional funds and
trust service, and the charter bank the area of growth
potential. Since the consolidation will provide additional resources and lending capacity, the resulting
bank will be in a position to compete more effectively
in its area with the other banks located there, and particularly with the larger Boston banks. The negligible
competition and the slight overlap of activities between
the two banks insure that the competitive structure of
southern Essex County will remain unchanged. The
consolidation will neither eliminate existing competition nor deprive the communities of a banking alternative, but will instead maintain the local character of
the resulting bank's facilities.
Applying the statutory criteria to the proposed consolidation, we conclude that it is in the public interest
and the application is therefore approved.
JANUARY 24,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Danvers National Bank, Danvers, Mass., with assets
of $9,914,000, proposes to consolidate with Security
Trust Co., Lynn, Mass., with assets of $30,912,000.
Security's facilities have been confined to Lynn, and
severe competition from Boston banks, 12 miles south,
is presently being experienced in the area which is
gradually becoming an integral part of the trade and
population area of metropolitan Boston. On this account and from other facts given in support of the

application, we conclude that the competitive factors
involved in the acquisition of Security by the charter
bank, which is located in an area where population and

economic growth have been great and a substantial
market for loans exists, would not be significantly
adverse.

THE UNION NATIONAL BANK OF PITTSBURGH, PITTSBURGH, PA., AND COMMONWEALTH BANK & TRUST CO.,
PITTSBURGH, PA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Commonwealth Bank & Trust Co., Pittsburgh, Pa., with
and the Union National Bank of Pittsburgh, Pittsburgh, Pa. (705), which
had
consolidated Feb. 28, 1964, under charter and title of the latter (705). The
consolidated bank at the date of consolidation had

COMPTROLLER S DECISION

On December 27, 1963, the $224.8 million Union
National Bank of Pittsburgh, Pa., and the $163.6 million Commonwealth Bank & Trust Co., Pittsburgh, Pa.,
applied to the Comptroller of the Currency for permission to consolidate under the charter and title of
the former.
The applicant banks are headquartered in Pittsburgh, Allegheny County, and have offices in five
adjoining counties. This industrial complex had a
population of 2,600,000 in 1960, reflecting a relatively
low growth of 9 percent since 1950. The Pittsburgh
area has, for many years, been one of the most important centers of steel and heavy industry in the world
and, in 1960, contributed over $2.9 billion to value
added in manufacture, as compared to $2.7 billion in
1958. While the most important single industry in
the six-county area is primary metals, or more specifically, iron and steel, fabricated metal products, nonelectrical and electrical machinery are also significant
factors in the economy, along with food processing and
stone, clay and glass products.
Coal mining, too, has long been associated with the
Pittsburgh area, which contains some of the world's
richest coal deposits. Although total mining employment declined 60 percent between 1950 and 1960, the
region, in 1961, mined 20 million tons of bituminous
coal, amounting to one-third of the State's total
production.
The Union National Bank of Pittsburgh, which was
founded in 1857 as the Diamond Savings Institution,
became a National Bank on January 12, 1865, in the
early years of the National Banking System. It remained a single-office institution until 1958, when an




$164, 640, 486

12

222, 879, 859

To be
operated

18

387, 520, 345

29

expansion program was initiated in order to better
compete with the three larger area banks. Since 1958
Union National has acquired six banks: Allegheny
Trust Co., Pittsburgh, a single-office bank with $9.4
million deposits and $5.6 million loans; First National
Bank in Tarentum, $10.1 million deposits, $5.6 million
loans and one branch; the Farmers National Bank of
Beaver Falls, two branches, $16.2 million deposits and
$7.6 million loans; the Coraopolis Trust Co. and its
wholly owned subsidiary Coraopolis National Bank,
$17.1 million deposits, $6 million loans and two main
offices, one 'of which was discontinued; the Bridgeville
National Bank, six branches, $22.4 million deposits
and $13.7 loans; and the Imperial Bank, Imperial,
with no branches, $3.6 million deposits and $1.3 million loans. The charter bank has thus acquired 15
branch offices, $78.8 million in deposits and $39.8 million in loans through various mergers and consolidations, all of which involved small banks with serious
management succession problems. With the addition
of 2 de novo branches, Union National presently has
17 branches, including 9 in Allegheny County, 3 in
Beaver County, 4 in Washington County, and 1 in
Westmoreland County. When its two approved but
unopened branches are included, the charter bank
will have 5 percent of the banking offices in the area.
As of September 30, 1963, Union National had total
deposits of $192.8 million and loans of $105.5 million, which are 3.96 and 4.88 percent, respectively, of
the deposits and loans held by all commercial banks
in the Pittsburgh six-county metropolitan area.
Commonwealth Bank & Trust Co., which was chartered by the Commonwealth of Pennsylvania on April
25, 1902, has acquired two banks during the past 10
years: South Hills Trust Co., Pittsburgh, a single75

office institution with deposits of $4.3 million and loans
of $1.1 million; and the Butler Savings & Trust Co.,
Butler, with three branches, $31.5 million in deposits
and $16.1 million in loans. The bank presently operates 11 branches, of which six are in Allegheny County,
four in Butler County and one in Armstrong County.
It operates 3 per cent of all area banking offices. Its
September 30, 1963, deposits totaled $150.3 million
and its loans totaled $60.4 million, which represent 3.09
and 2.8 percent, respectively, of total deposits and loan
of all area commercial banks.
Both the charter bank, fourth largest in the area,
and the consolidating bank, fifth largest, are offered
strong competition by the three larger banking institutions. The $2.7 billion Mellon National Bank & Trust
Co., Pittsburgh, is by far the largest bank in the area,
being more than twice the size of any other commercial
bank in the region. Its $2.3 billion deposits represent
48.11 percent of area deposits, and its $932.4 million
in loans are 43.16 percent of area loans. Mellon National also operates 75 branches and has 9 branches
approved but unopened, for a total of 25 percent of
the 6-county area banking offices.
The second ranking bank in the area is the $1.1
billion Pittsburgh National Bank, Pittsburgh, whose
59 branches and 14 approved but unopened branches
total 21 percent of the area's banking offices. Pittsburgh National has 21.15 percent of area deposits,
with $1 billion, and 21.6 percent of area loans, with
$466 million.
Western Pennsylvania National Bank, McKeesport,
is the third largest bank in the area, with total resources of $502.3 million. With $464 million in
deposits and $225.7 million in loans, it holds 9.53 and
10.45 percent, respectively, of total deposits and loans
in the Pittsburgh complex. Western Pennsylvania has
15 percent of area banking offices, with 42 branches
and 7 approved but unopened branches.
There are 59 smaller commercial banks operating in
the 6-county area which have a total of 51 operating
and approved but unopened branches, for a total of
32 percent of area banking offices. Their aggregate
deposits total $689.8 million, or 14.16 percent of area
deposits, and their loans, $369.7 million, or 17.11 percent of area loans. Total resources of these 59 institutions is $773 million.
Additional competition is offered by the $239 million Dollar Savings Bank, a mutual financial institution which holds $219 million in deposits and $137
million in loans. The Pittsburgh financial market
also lists 165 savings and loan associations with total
assets of $1.3 billion, and 372 credit unions with re76




sources of $94 million. Further competition for loans
is offered by the major insurance companies and the
more than 50 sales finance and personal loan companies.
The resulting bank will be a $380.3 million
institution with 7 percent of area deposits and 7.68
percent of area loans. It will have 31 branches, representing 8 percent of total banking offices. Approval of
the application will not change its ranking as the fourth
largest bank in the Pittsburgh area but will make it
closer in size to Western Pennsylvania National Bank.
It will remain considerably smaller than Mellon National and Pittsburgh National.
The primary reason advanced in favor of approval
of this consolidation is to enable the applicants to
compete more effectively with the three much larger
banks serving Pittsburgh and its environs. Retail
banking services have assumed increased importance
during recent years and a comprehensive branching
system is necessary in order to adequately compete in
this field. Mellon National, Pittsburgh National, and
Western Pennsylvania, with 85, 74, and 50 approved
offices, respectively, are considerably stronger than
Union National's 20 approved offices or Commonwealth's 12. By consolidating, the resulting bank will
have 32 offices, which will make it more competitive
with the top three banks.
The growing borrowing requirements of existing
customers offer another example of the need for this
consolidation. With lending limits of $1.75 million
for Union National and $1.2 million for Commonwealth, both banks are at a competitive disadvantage
in serving the needs of large borrowers. The application cites several instances of actual cases where valuable business has been lost in whole or in part to a
larger bank in the area due to the lower lending limits
of the consolidating bank. Pittsburgh's industrial and
commercial enterprises are heavy users of debt capital
and are also courted by the New York, Chicago, Cleveland, and Philadelphia banks. The resulting bank's
lending limit of $3 million, while only one-tenth of
Mellon National's $30 million and one-third of Pittsburgh National's $9 million, will at least bring it
closer to the $3.8 million lending limit of Western
Pennsylvania.
Approval of the consolidation will also enable the
resulting bank to install electronic data processing
equipment to provide additional services to banking
customers comparable with those already offered by
the three larger area banks. And, although senior
management at both banks is of high quality, the

consolidation will permit more; depth and balance on
the intermediate and junior levels.
Because of the location of the main offices of the
consolidating banks in downtown Pittsburgh, a minimal amount of competition presently existing between them will be eliminated. A review of deposits
and loans of $5,000 or more revealed that the institution had but 157 common depositors and 7 common
borrowers. It should also be pointed out that several
of the common depositors are large corporations which
carry primary accounts at one bank and small convenience accounts at the other,
Another question which must be considered in evaluating this proposal is whether it will have a tendency
toward monopoly. It is true that the four largest
area banks presently hold more than 80 percent of area
deposits. However, the bulk of this is in the Mellon
bank, which holds more than 48 percent of deposits,
while the consolidating banks hold only 3.96 and
3.09 percent for a total of 7.05 percent. Nevertheless,
even if the four largest banks are used as a basis for
determining concentration of banking resources, approval of the proposal will result in an increase in concentration of only 3.75 percent in deposits and 3.5 percent in loans. The consolidation will therefore have
no tendency toward monopoly nor would it result in
any undue increase of the market share of the resulting bank.
The competitive effect of the proposal on the smaller
commercial banks in the six-county area will be relatively unchanged. These banks, which are presently
in competition with the applicants and the three larger
area banks, will not be significantly affected. The
competition of the resulting bank and its branches will
not render the smaller banks any more or less competitive than they are at present.
Approval of the proposal will enable the resulting
bank to compete more effectively with its larger
competitors and will, at the same time, permit it to
offer expanded services to the banking public. The
proposal evidences no tendency toward monopoly and,
while a nominal amount of competition between the
consolidating banks will be eliminated, there will be no
adverse competitive effect on the smaller area banks.
Having weighed the proposal in light of the statutory
criteria, we find it to be in the public interest and
it is therefore approved.
FEBRUARY 28,

1964.




SUMMARY OF REPORT BY ATTORNEY GENERAL.

Union National is the fourth largest commercial
bank in Pittsburgh with assets of $224,160,000, deposits
of $199, 336,000, loans of $111,714,000, and 18 offices.
Commonwealth Trust is fifth largest in the city with
assets of $163,669,000, deposits of $147,389,000, loans
of $61,122,000, and 12 banking offices. These 2 banks
have acquired a total of 9 banks since 1954.
Union National accounts for about 4 percent of
deposits and 5 percent of loans in Allegheny County
and five contiguous counties in which a Pittsburgh
bank may establish branch offices under Pennsylvania
law. Commonwealth Trust holds 3 percent of total
deposits and loans in this area.
Pittsburgh is one of the most highly concentrated
major banking markets in the Nation. The top five
banks account for 92 percent of deposits and 91 percents of loans in Allegheny County and for 86 percent
of deposits and 83 percent of loans in the entire sixcounty area. The top two banks together, Mellon National Bank and Pittsburgh National Bank, account
for from 65 to 75 percent of these totals. Much of this
concentration is the result of a pronounced merger
trend since 1950 which has seen the 6 largest banks
absorb at least 65 banks, leaving but 64 banks in the 6county area. The justification for the proposed merger
stems in large part from the competitive handicap of
competing with the three largest banks in the area
which have been permitted to obtain their dominant
position in substantial part from permission to merge
and consolidate with other banks and the opening
of numerous denovo offices in the area served by them.
It is obvious that competition cannot be maintained
in this area as long as the dominant institutions are
permitted to acquire or merge with other banks and
obtain numerous de novo branches in the area.
The proposed consolidation might strengthen the
resulting bank's ability to compete with the three largest banks in the area. But it would at the same time
eliminate a substantial amount of direct competition
between the consolidating banks and add significantly
to concentration in a market already highly concentrated, in part by a series of mergers in which the consolidating banks have participated. By the consolidation, one of just six banks in the area which could make
loans in excess of $400,000 would be eliminated.
We conclude that the proposed consolidation would
have a serious adverse effect upon competition.

77

LINCOLN NATIONAL BANK & TRUST CO. OF CENTRAL NEW YORK, SYRACUSE, N.Y., AND FIRST NATIONAL BANK
OF MINOA, MINOA, N.Y.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

First National Bank of Minoa, Minoa, N.Y. (13476), with
and Lincoln National Bank & Trust Co. of Central New York, Syracuse, N.Y.
(13393), which had
merged Feb. 28, 1964, under charter and title of the latter bank (13393).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On December 6, 1963, the $160 million Lincoln
National Bank & Trust Co. of Central New York,
Syracuse, N.Y., and the $6.3 million First National
Bank of Minoa, Minoa, N.Y., applied to the Comptroller of the Currency for permission to merge under
the charter and with the title of the former.
Syracuse, with a population of about 216,000, is the
fourth largest city in New York and the focal point of
a metropolitan area of about 423,000. Centrally located in the State, Syracuse is a distribution center
served by three major airlines, two trunk line railroads,
and two limited access superhighways which quadrisect
the State. The economy of the Syracuse metropolitan
area is widely diversified and holds promise for continued growth.
Minoa, with a population of 1,800, is a residential
community about 9 miles east of downtown Syracuse.
It is in the Syracuse trade area and many of its residents commute to Syracuse for employment.
The charter bank is a full-service institution, operating 7 branches in the Syracuse area and 6 in outlying
communities. It is the third largest of 4 commercial
banks in Syracuse. It also competes in this service
area with 2 mutual savings banks, 4 savings and loan
associations and 13 finance companies.
The merging bank is the only bank in Minoa. Its
nearest competitors are in Syracuse. This limited
service bank will soon be faced with a management
succession problem due to the impending retirement
of its president.
The inhabitants of Minoa will be the primary beneficiaries of the proposed merger. Not only will they

78




To be
operated

$6, 273, 433

1

156,033,619

14

162,211,424

15

be afforded trust services locally, but the resulting bank
will introduce installment lending to the area. Moreover, along with offering improved banking services,
locally, the merging bank will also find a solution to its
management succession problem.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
FEBRUARY 17,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Lincoln National is third in size among four commercial banks with head offices in Syracuse. It has
$142 million in deposits or approximately 24 percent
of the deposits held by banks competing within its
service area. First National is a unit bank located in
the Village of Minoa, 5 miles east of Syracuse. It
has $5.7 million in deposits, or about 1 percent of
deposits of banks competing in its service area.
The service area of Lincoln National extends well
beyond the city of Syracuse and includes almost all of
the service area of First National. However, the
amount of competition between the banks appears not
to be significant due to the size and limited range of
services of First National.
The proposed merger will not significantly alter the
banking structure in the relevant area. Lincoln National will increase its market share by only 1 percent
and will continue to be the third largest bank in Syracuse. It is unlikely that adverse effects will be felt
by smaller independent banks, the closest of which is
13 miles from First National. We therefore conclude
that the proposed merger will have no substantial adverse effects upon competition.

OLD

NATIONAL BANK OF WASHINGTON, SPOKANE, WASH., AND THE FIRST NATIONAL BANK OF PULLMAN,
PULLMAN, WASH.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The First National Bank of Pullman, Pullman, Wash. (4699), with
and Old National Bank of Washington, Spokane, Wash. (4668), which
had
merged Feb. 28, 1964, under the charter and title of the latter bank (4668).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On December 11, 1963, the $186.7 million Old
National Bank of Washington, Spokane, Wash., and
the $14.5 million First National Bank of Pullman,
Pullman, Wash., applied to the Comptroller of the
Currency for permission to merge the charter and
with the title of the former.
Spokane, with a population of about 182,000, supported by agriculture, mining, lumbering, light manufacturing and trade facilities, is the second largest city
in the State and the principal city in the so-called
Inland Empire which comprises eastern Washington,
northern Idaho, and western Montana.
The Spokane area relies primarily on agricultural
products and related industries for its economic support. The more important of these products are
grains, sugar beets, hops, fruits, and row crops. The
secondary economic factors of the area are lumbering,
mining, and manufacturing, in that order but with
the latter showing a much stronger percentage of
increase in recent years.
Pullman, located 80 miles south of Spokane, has a
population in excess of 13,000, including approximately 8,000 seasonal residents enrolled at Washington
State University. The university is rapidly expanding
and has supplanted agriculture as the primary economic support of Pullman.
Old National Bank, the seventh largest bank in
Washington, is an affiliate of Old National Corp., a
registered bank holding company. The bank maintains 28 branches throughout the eastern half of the
State. Other statewide banks having branches in the
trade area of the charter bank are the Seattle-First




To be
operated

$15,342,275

2

176,873,976

27

191,719,372

29

National Bank, the largest in the State, with 101
branches and the National Bank of Commerce, the
second largest with 67 branches.
Approval of the proposed merger will be primarily
beneficial to the merging bank and the community
which it serves, by providing trust services, larger lending capacity, and the services of the charter bank's
agricultural agent. The proposed merger will not
affect the competitive banking picture in eastern
Washington to any extent, nor eliminate any substantial competition between the charter and the merging
banks, since the two banks do not directly compete at
the present time. Though an independent bank will
be eliminated, it will be replaced by a stronger banking
facility better able to compete with the branch of
Seattle-First National Bank.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
FEBRUARY 12,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger of the First National Bank of
Pullman, Pullman, Wash., into the Old National Bank
of Washington, Spokane, Wash., will not have a significant adverse effect upon competition.
First Pullman has apparently not been successfully
competing with a branch of Seattle-First National
Bank located in Pullman, Wash. The proposed transaction will provide a stronger competitor in the area.
Finally, no substantial direct competition between First
Pullman and Old National Bank will be eliminated by
the proposed merger and consolidation.

THE LIBERTY NATIONAL BANK & TRUST CO., BUFFALO, N.Y., AND THE PEOPLES BANK OF ERIE COUNTY, HAMBURG, N.Y.
Banking offices
Total assets

Name of bank and type of transaction

The Peoples Bank of Erie County, Hamburg, N.Y., with
and Liberty National Bank & Trust Co., Buffalo, N.Y. (15080), which had. . . .
merged Mar. 5, 1964, under the charter and title of the latter bank (15080).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On January 7, 1964, the $288 million Liberty National Bank & Trust Co., Buffalo, N.Y., and the $22
million Peoples Bank of Erie County, Hamburg, N.Y.,
applied to the Comptroller of the Currency for permission to merge under the charter and with the title
of the former.
Buffalo, the county seat of Erie County and the second largest city in New York, with a population of
541,282, is the focal point of a service area which
approaches 1 million inhabitants. Although the population of the city has declined slightly since 1950, the
area has experienced the substantial population increase of 20 percent since that time, reflecting a movement to the suburbs. Buffalo and the surrounding area
constitute the eighth largest manufacturing center
in the Nation. Heavy industry dominates a diversified manufacturing structure composed of many national corporations as well as smaller local plants.
With business indicators presently moving upward
from a relatively high base level and unemployment
at a lower rate than in any year since 1957, the outlook for the Buffalo area economy is favorable.
The village of Hamburg, whose population is 9,124,
is located 12 miles south of Buffalo in the town of
Hamburg, and is comprised principally of middle-income families who work in the industrial complexes of
Buffalo and other nearby towns. The village, which
has numerous commercial enterprises, has long been
a trading center for the surrounding area. Although
population growth of the village has been moderate, a
more rapid increase in the future is expected because
of its proximity to Buffalo, improved public facilities,
and imminent construction of the Boston Expressway,
a superhighway which will connect Buffalo with Hamburg and points south.
The charter bank, with 30 offices, is the third largest
bank in Buffalo. It is appreciably surpassed in size by
the $1,042 million Marine Trust Co. of western New
80




$22,313,663
297,076,017
319,308,335

In
operation

To be
operated

2
30
32

York and the $620 million Manufacturers & Traders
Trust Co., both of which have headquarters in Buffalo
and branch throughout western New York. Marine
Trust Co. has 64 offices and Manufacturers & Traders
Trust Co. has 46 offices. Five other banks in the Buffalo service area range in size from the $9.2 million
Lincoln National Bank, Buffalo, to the $77 million
Chautauqua National Bank of Jamestown, a member of the Marine Midland group.
The merging bank, which serves the village of
Hamburg, has one branch in nearby North Collins, an
agricultural community. A branch of the Marine
Trust Co. is the only other bank in the village of
Hamburg.
The charter bank is a full-service institution which,
until recently, has concentrated on serving the city of
Buffalo, while the population movement has been to
the suburbs. In contrast, the two dominant banks in
the area have established extensive branching systems
and, consequently, have placed the charter bank in a
difficult competitive position. The fact that the Marine Trust Co. controls 44.6 percent, and the Manufacturers & Traders Trust Co. 24.7 percent, of the
commercial banking resources in the service area
makes obvious the conclusion that the charter bank,
which has 10.9 percent of the area's banking resources,
is not a giant in the Buffalo area. The addition of
the resources of the merging bank will make the charter bank a more competitive force in Buffalo by increasing its lending limit although the limit will still
not approach that of the two largest banks. In addition, the broader market area will allow the charter
bank to service business and individual customers who
require a bank with facilities in a large service area.
Although the merger will improve the banking structure in Buffalo, and western New York, its main effect
will clearly be felt in Hamburg. The market area of
the merging bank is largely limited to the village of
Hamburg, as 79.1 percent of the bank's deposits originate in the village and the remainder in surrounding

towns. Only one-one hundredth of 1 percent of the
charter bank's deposits come from the village of Hamburg, even though the charter bank has a branch 3
miles away.
The sole competition to the merging bank comes
from the local branch of Marine Trust Go. The disparity in size and the limited services available from
the merging bank make competition increasingly difficult. The small lending limit forces the merging
bank to deal only with the very small customers and
leaves Marine Trust Co. to serve the medium industrial
accounts which are important in the area. Such services as business development and an experienced trust
department are beyond the capacities of the merging
bank. The fact that the Marine Trust Co. clears the
merging bank's checks further indicates a less-thanperfect competitive structure in the village.
A serious problem of management succession presents a compelling consideration. It is an axiom of
the banking industry that a bank is only as effective as
its management. A depletion in the ranks of management and an inability to recruit new management
personnel create a serious problem for any bank. This
is precisely the situation in which the merging bank
finds itself. Two presidents have died within 8 years
and an executive officer resigned recently. There has
been no long-range development of middle management, and efforts over the past 3 years to hire officers
have been fruitless. Consequently, senior management is inadequate in the face of present demands, no
successor management exists, and junior management
is insufficient. The experienced and extensive management of the charter bank can adequately fill the
gap and provide full-range banking services, such as

a progressive loan-deposit ratio, a real estate loan department, automation and extensive trust facilities, all
of which are absent in the merging bank.
Applying the relevant statutory criteria to the proposal to merge, we conclude that it is in the public
interest and the application is therefore approved.
MARCH 3, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Commercial banking in the Ninth Banking District, in which both of the merging banks are located,
is highly concentrated, with the three largest banks
accounting for 77 percent of the total assets and 64
percent of the offices of all such banks. Liberty National is the third largest bank in the District and accounts for 10.75 percent of the banking assets. Since
1945 the number of independent banks in the District
has decreased from 91 to 40. Six independent banks
have been lost through mergers with Liberty National
since 1961.
As the number of independent banks declines, the
importance of retaining the competitive activity of any
given one of them increases proportionately. Peoples
Bank, the 10th largest bank in the District, appears
to have a good opportunity for continued growth. In
our opinion, in view of the direct competition which
would be eliminated and the stimulus which would
be given to further mergers, the effect on competition
of the proposed merger of Liberty National and Peoples
Bank would be substantially adverse.
Our concern about further concentration of banking
in the Ninth Banking District was previously voiced
by the New York State Superintendent of Banks who in
1962 disapproved this proposed merger.

THE MICHIGAN NATIONAL BANK, LANSING, MICH., AND THE GRAND LEDGE STATE BANK, GRAND LEDGE, MICH.,
AND THE LOAN & DEPOSIT STATE BANK, GRAND LEDGE, MICH.
Bankin ? offices
Name of bank and type of transaction

Total assets
In
operation

Grand Ledge State Bank, Grand Ledge, Mich., with
and Loan & Deposit State Bank, Grand Ledge, Mich., with
were purchased Mar. 14, 1964, by Michigan National Bank, Lansing, Mich.
(14032), which had
,
After the Durchase was effected, the receiving bank had

COMPTROLLER S DECISION

On August 13, 1963, the Michigan National Bank,
Lansing, Mich., applied to the Comptroller of the Cur-




To be
operated

$6, 887, 000
4, 562, 000

1
1

714,648,000
724,811,000

17
19

rency for permission to purchase the assets and assume
the liabilities of the Grand Ledge State Bank, Grand
Ledge, Mich., and the Loan & Deposit State Bank,
Grand Ledge, Mich.
81

Lansing has a population of 108,000, and is both the
capital of Michigan and one of the principal industrial
cities in the State. The manufacture of autos and related items and the expanding activities of the State
government provide important sources of employment.
The city also serves as a trade center for the surrounding agricultural areas and is home to Michigan State
University which has an enrollment of some 28,000.
The prosperity generated by this diversified activity is
reflected by the manner in which the population has
grown during the last decade, so that the present population of the Lansing trade area is estimated to be
150,000.
The $714 million Michigan National Bank of Lansing has 18 offices and competes primarily with 2 other
banks in Lansing, the $93.3 million American Bank &
Trust Co. and the $53.6 million Bank of Lansing.
There are, in addition, seven smaller banks in the
towns surrounding Lansing, ranging in size from the
$1.8 million Woodruff State Bank, DeWitt, Mich., to
the $19.6 million East Lansing State Bank, East Lansing, Mich.
Grand Ledge has a population of 5,165, and is located 10 miles west of Lansing. The two cities are
connected by a new four-lane highway. The immediate area around Grand Ledge is largely agricultural,
although there are some small industries in Grand
Ledge which employ a total of 300 to 400 people. A
recent Michigan State University survey indicated that
80 percent of the wage earners residing in Grand
Ledge work in Lansing, making Grand Ledge virtually
a residential suburb of Lansing.
The $6.1 million Grand Ledge State Bank and the
$4 million Loan & Deposit State Bank are the sole
banks in Grand Ledge. They compete with the larger
Lansing banks as well as the five smaller banks in the

Lansing trade area. As is common among smaller agriculturally oriented institutions, they are experiencing
difficulty in serving the needs of the expanding economy by reason of their limited resources and lending
capacity and are faced by management succession
problems, here made critical by the imminent retirement of their senior management personnel.
While consummation of this proposal will have no
significant consequences in the city of Lansing, it will
produce marked benefits for the public in the Grand
Ledge area. The people of Grand Ledge will have
more convenient access to the enlarged services of a
modern and efficient bank and will derive the benefits
which flow from the presence of a competitively aggressive institution.
Applying the statutory criteria of the proposed purchase of assets and the assumption of liabilities, we
conclude that it will be in the public interest and the
application is therefore approved.
MARCH 6,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Approval of the proposed acquisition of the assets
and the assumption of the liabilities of the Grand
Ledge State Bank and the Loan & Deposit State Bank,
Grand Ledge, Mich., by the Michigan National Bank,
Lansing, Mich., will result in the disappearance of two
small independent banks and in the enhancement of
the position of Michigan National, one of the largest
banks in the United States, a position achieved in part
through a series of mergers with other banks.
The mergers will also eliminate a significant amount
of competition between the acquiring and the acquired
merging banks. The effect of the acquisition on
competition would therefore be substantially adverse.

AMERICAN NATIONAL BANK OF VINCENNES, VINCENNES, IND.; FIRST NATIONAL BANK OF BICKNELL, BICKNELL,
IND.; BICKNELL TRUST & SAVINGS, BICKNELL, IND.; AND CITIZENS STATE BANK, BICKNELL, IND.
Banking offices
Name of bank and type of transaction

The First National Bank of Bicknell, Bicknell, Ind. (7155), with
Bicknell Trust & Savings Co., Bicknell, Ind., with
The Citizens State Bank, Bicknell, Ind., with
and the American National Bank of Vincennes, Vincennes, Ind. (3864), which
had
merged Mar. 21, 1964, under charter and title of the latter bank (3864). The
merged bank at the date of merger had

82




Total assets

In
operation

To be
operated

$2, 398, 048
1,697,597
1, 072, 072

1
1
1

21, 799, 040

1

26, 591, 805

2

COMPTROLLERS DECISION

On November 12, 1963, the $22.1 million American
National Bank of Vincennes, Vincennes, Ind., and the
$2.5 million First National Bank of Bicknell, the $1.7
million Bicknell Trust & Savings, and the $1.1 million
Citizens State Bank, all of Bicknell, Indiana, applied
to the Comptroller of the Currency for permission to
merge under the charter and title of "The American
National Bank of Vincennes."
The applicant banks are located in Knox County in
southwestern Indiana, on the Illinois border. Vincennes, with a population of 18,000, is both the county
seat and the largest town in Knox County. As the
center of a basically agricultural trade area embracing
not only most of Knox County but also part of the
surrounding territory in Illinois, Vincennes serves more
than 40,000 people. In addition, manufacturing
plays a large part in the community's economy since a
number of major industrial plants are located there.
Competition for the charter bank in Vincennes
comes from numerous sources. The only other bank
in town, while somewhat smaller, competes strongly
for loans and other commercial and trust business and,
in addition, its three branches, located in another region of the county, give it access to an area difficult for
the charter bank to serve. Nonbank competition
comes not only from private sources such as savings
and loan associations, credit unions, finance companies, loan companies, and insurance companies, but
also from Federal government agencies that provide
credit for fanners in their personal and agricultural
activities.
Bicknell, with a present population under 4,000, was
once a town of 9,000 supported by a nearby Pennsylvania Railroad yard and a million dollar a month coal
mine payroll. These operations have been discontinued, however, and now only one factory remains.
The town relies heavily on local agricultural activity
for its economic support, but since agricultural units
are increasing in size and mechanization, fewer trade
and employment opportunities result. Although only
the merging banks are located in Bicknell, the other
Vincennes bank maintains two branches nearby that
offer active competition. Limited competition for the
merging banks comes from the nonbank financial
sources operating in Vincennes.
Prospects for future earnings of the charter bank appear to be good. A diversified economy and the community's progressive nature indicate the presence of a
background and atmosphere conducive to growth. In




Bicknell, however, future prospects would seem dim.
The downtrend in population and economic activity
suggests the serious problem of one or more of these
banks ending operations. Moreover, officers of two of
the merging banks are approaching retirement age.
Merger with the charter bank will alleviate both problems and assure continuing banking facilities for
Bicknell.
The Bicknell banks at present provide limited services to their community. By merging, services now offered can be expanded and more complete banking
facilities, including a trust department, will be available to the community. In effect the merger will provide a broader based, better balanced institution that
will more effectively serve the convenience and needs
of the Bicknell community.
The proposed merger will have a negligible effect on
competition in the Vincennes area. While the resulting bank's deposits will be greater than that of its local
banking competitor, the total of loans will be approximately equal. Moreover, the resulting bank's branch
in Bicknell will now be able to offer effective competition to the competing institution's nearby branches.
In Bicknell, while the total elimination of the town's
banking institutions and replacement by branch offices
could constitute a serious detriment to the community
which would normally be dispositive of the application,
under the circumstances as presented above such a decision would be in error because it would result in the
lingering death of one or more of the merging banks
through lack of business. Clearly this is the greater
detriment to the community.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest
and the application is therefore approved.
MARCH 16,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The acquiring bank is the largest (in terms of deposits) in its service area, which covers Knox County,
Ind., and part of Lawrence County, 111. By this
•application it seeks to acquire all three commercial
banks operating in Bicknell, Ind., a town some 15 miles
distant from the acquiring bank's home office in Vincennes, Ind. If accomplished, the mergers would
increase the acquiring bank's share of service area deposits from 31 to 39 percent, an increase in concentration of 79.5 percent. The next largest of 12 banks
in the area would have 19 percent and the third largest only 8 percent. The mergers would also replace

83

three competing unit banks in the town of Bicknell
with one branch of a large Vincennes Bank so that
Bicknell area residents would be forced to go to nearby
towns for alternative commercial banking. Moreover,

the nearest of these other banks are branches of
Vincennes' other large banks.
The result of the proposed acquisition on competition would appear to be adverse.

THE FIRST NATIONAL BANK OF SOUTH CAROLINA OF COLUMBIA, COLUMBIA, S.C., AND THE DARLINGTON
COUNTY BANK & TRUST CO., DARLINGTON, S.C.
Banking offices
Total assets

Name of bank and type of transaction

Darlington County Bank & Trust Co., Darlington, S.C, with
and the First National Bank of South Carolina of Columbia, Columbia, S.C.
(13720), which had
merged Mar. 31, 1964, under charter and title of the latter bank (13720).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On January 20, 1964, the $106 million First National Bank of South Carolina of Columbia, Columbia,
S.C, and the $6.3 million Darlington County Bank &
Trust Co., Darlington, S.C, applied to the Comptroller of the Currency for permission to merge under the
charter and title of the former.
Although the charter bank, with 24 branch offices
throughout the State, is the third largest bank in South
Carolina, it is considerably smaller than the two larger
statewide banking institutions, the $325 million South
Carolina National Bank of Charleston and the $171.5
million Citizens & Southern National Bank of South
Carolina.
Columbia, the headquarters of the charter bank, is
the capital and largest city of South Carolina with a
population of 97,500. It is located in the central part
of the State with an economy principally supported by
military installations, retail and wholesale trade, textile
manufacturing, and State governmental activity.
The merging bank is located 85 miles northeast of
Columbia in Darlington, a small rural community with
a population of 6,700 in the "Great Pee Dee" tobacco
area. This town is the county seat of Darlington
County, population 53,000. The economy is largely
dependent upon agriculture, mostly tobacco with some
cotton and soybeans. Local industry includes an electronics manufacturing plant which employs 1,100, a
paper container company which employs 700, and the
Nation's largest automobile auction.
The effect of the merger in the seven major areas
now served by First National will be slight. Any im84




To be
operated

In
operation
$6, 372, 795

1

105,971,091

23

111,768,296

24

pact will be felt principally in Darlington. Since the
Darlington banks are already in competition with the
two largest statewide banks' branches in Florence,
which is 10 miles southeast of Darlington, the entry of
First National into this area will tend to increase
rather than diminish competition.
There will be no elimination of competition between
the two merging banks, as the nearest branch of First
National is located 28 miles northeast of Darlington in
Bennettsville. There are no common borrowers or
depositors, and neither bank derives business from the
other's service area.
The public interest will be served by a local unit of
First National which will be able to furnish the Darlington County banking public with more extensive
trust services and aggressive competitive management.
The resulting local banking unit will have a greatly
enlarged lending capacity, thereby increasing its utility
to the business community. In addition, a serious
management succession problem will be solved.
Considered in light of the statutory criteria, we find
the application to be in the public interest and the
merger is therefore approved.
MARCH 26,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

First National is the third largest commercial bank
in South Carolina with over 8 percent of the State's
deposits and 25 offices. Since 1955 First National has
acquired 7 other banks with deposits of $38,846,000
and 11 offices. Darlington Trust is a single-office bank
located in Darlington, S.C, 78 miles northwest of First
National's main office in Columbia, S.C, and 28 miles

southwest of First National's nearest branch in Bennettsville, S.C. Both banks have shown excellent
growth in deposits and earnings. There appears to be
little direct competition between the applicants at
present due to the distances between their respective
offices.
South Carolina's banking resources are highly concentrated in four large statewide institutions (including
First National) which together control 53 percent of
the State's total deposits, partly as a result of prior
mergers. These four banks have acquired 23 smaller
banks in the past decade and at the same time have
been opening numerous de novo branch offices. Such
acquisitions by one of the four dominant banks have
often led directly to a similar acquisition by one of the
others, with the result that the only independent banks
in a number of South Carolina communities have been
eliminated from competition and remaining unit banks
in nearby communities have been subjected to direct

competition with offices of much more powerful institutions.
The proposed merger conforms with the trend now
well-established in the State. First National would
increase its resources and extend its branch system into
another community. As a result, the three other statewide systems would be motivated to keep up with First
National by making similar acquisitions and those
smaller banks in most direct competition with Darlington Trust would consider seriously such a proposal to
insure their survival in competition with First National.
In fact, following the filing of this application the
second largest bank in the State has announced plans
to acquire the only other bank in Darlington, Citizens
Bank of Darlington.
In view of the bank merger history in South Carolina, the proposed merger threatens to have a seriously
adverse effect upon competition and may aggravate
the trend toward monopoly in that State.

THE VIRGINIA NATIONAL BANK, NORFOLK, VA., AND THE SOUTHERN BANK OF COMMERCE, DANVILLE, VA.
Banking offices
Name of bank and type of transaction

Total assets

Southern Bank of Commerce, Danville, Va., with
and Virginia National Bank, Norfolk, Va. (9885), which had
merged Apr. 3, 1964, under charter and title of the latter bank (9885). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On January 23, 1964, the $404 million Virginia
National Bank, Norfolk, Va., and the $2.8 million
Southern Bank of Commerce, Danville, Va., applied
to the Comptroller of the Currency for permission to
merge under the charter and title of the former.
The growth of the Norfolk economy has been noted
in recent statements approving mergers to which Norfolk banks were parties. Norfolk's large military installations and port facilities, as well as increasing
manufacturing industries, place the area, with a total
population of 578,000, in a favorable economic position
and create constantly new demands on its financial
facilities.
The charter bank is presently the second largest
bank in Virginia and operates a statewide system consisting of 43 offices located in 4 primary service areas.
With 9 percent of the State's total banking resources,
Virginia National is slightly smaller than the $425 mil-




$2,912,064
391,628,739
394, 470, 103

In
operation

To be
operated

2
41
43

lion First & Merchants National Bank, Richmond,
which has 9.9 percent of total state resources, and is
larger than the $283 million State-Planters Bank of
Commerce & Trusts, Richmond, which has 6.3 percent
of total state resources. Aggressive competition is furnished throughout applicant's service areas by 99 banking facilities with aggregate deposits of approximately
$836 million and aggregate loans of $594 million.
Further, Virginia National competes with four bank
holding companies which have aggregate deposits of
$1.2 billion and loans of $800 million. This merger
will only slightly augment the applicant's present resources and Virginia National will still occupy second
place among Virginia banks.
The Southern Bank of Commerce serves Henry
County and the southern two-fifths of Pittsylvania
County, which area includes the cities of Danville and
Mar tinsvi lie.
Danville, with a population of 46,577, is located in
southern Virginia a short distance north of the North
85

Carolina State line. The city serves a trade area covering a 30-mile radius in which an estimated 300,000
persons reside. The main sources of income for the
area are industry and agriculture. The largest singleunit textile mill in the country, located in Danville,
provides employment for about 10,000 persons. The
agriculture of the area depends principally upon the
growing, processing and marketing of tobacco. Other
farm income is derived from the raising of livestock
and grains.
Martinsville, an independent city and the seat of
Henry County, is some 30 miles west of Danville. Its
population, according to the 1960 census, was 18,798,
and an estimated 60,000 persons reside in its trade area.
The region is predominantly industrial, with numerous
plants in or near the city. Farm income, which plays a
secondary role in the economy, is derived almost entirely from bright leaf tobacco, although there is some
raising of beef cattle and dairy farming. Tobacco
market sales reached a high during the 1962 season
and business conditions in general have been very
favorable in the Martinsville area with future prospects
appearing to be good.
The merging bank is the smallest of seven banks
serving Danville. It has struggled for existence ever
since it received its state charter in 1952 and there has
been some question recently as to whether this charter
would be allowed to continue. The bank is now
smaller than it was 10 years ago and is the only Danville bank that did not grow during this period. Its
public image is not favorable.
Competition among the banks in Danville will not
be affected appreciably by this merger. The merging
bank never had sufficient resources to compete effectively with the six other banks led by the $36 million
First National Bank, and the $26 million American
National Bank & Trust Co. Indeed, merger of the
weak Southern Bank of Commerce into the charter
bank may well prevent development of a problem

which could easily upset; the stability of the present
banking situation in Danville.
Having reviewed the proposal in the light of the
statutory factors, we find that it is in the public interest
and it is therefore approved.
APRIL 1, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Virginia National is the second largest bank in Virginia and the dominant bank in its primary service
area which includes Norfolk, the largest industrial area
in the State. As of December 13, 1963, assets were
$404,815,000, loans were $224,996,000, deposits were
$374,191,000 and capital accounts were $32,747,000.
Virginia National presently has 43 banking offices in
20 communities throughout the State of Virginia.
Southern Bank of Commerce is located in Danville>
about 195 miles west of Norfolk. As of December 13,
1963, its total assets were $2,760,000, loans were
$1,578,000, deposits were $2,230,000 and capital accounts were $321,000.
Taken by itself, the effect of this proposed merger
on competition would not be significantly adverse.
However, since 1956 Virginia National has participated
in six mergers and consolidations, five of which were
consummated in 1963. These mergers have given
Virginia National, as of the dates of acquisition, more
than $173 million in deposits and 32 branch offices,
or nearly 50 percent of its present deposits and more
than 65 percent of its present offices. In addition, an
application has recently been filed to merge the First
National Bank of Buena Vista, Buena Vista, Va., a
bank with resources of $4,855,000.
It is the cumulative effect of the series of mergers
engaged in by Virginia National that is of concern to
this Department. It is our view that the overall effect
of this series of mergers on competition is adverse since
it contributes to the serious trend toward concentration
of banking in the State of Virginia by the merger
process.

THE FIRST NATIONAL BANK OF BUENA VISTA, VA., AND THE VIRGINIA NATIONAL BANK, NORFOLK, VA.
Banking offices
Name of bank and type of transaction

The First National Bank of Buena Vista, Buena Vista, Va. (9890), with. .
and Virginia National Bank, Norfolk, Va. (9885), which had
merged Apr. 3, 1964, under charter and title of the latter bank (9885). The
merged bank at the date of merger had

86




Total assets

$4, 995, 320
394,470,103
399, 206, 974

In
operation

To be
operated

1
43
44

COMPTROLLER S DECISION

On January 28, 1964, the $405 million Virginia National Bank of Norfolk, Norfolk, Va., and the $4.9 million First National Bank of Buena Vista, Buena Vista,
Va., applied to the Comptroller of the Currency for
permission to merge under the charter and title of the
former.
The Norfolk-Portsmouth metropolitan area is one of
the major service areas of the charter bank and is the
state's top-ranking metropolitan area from the standpoint of population, income, and retail sales. With a
population of 887,568, the Norfolk area enjoys personal annual income in excess of a billion dollars. Retail sales have increased from $88 million in 1939 to
a record $563 million in 1958. It is a dynamic, expanding and an increasingly important center of the
Eastern Seaboard's economy.
The Virginia National Bank is the second largest
bank in Virginia and has 43 banking offices in 20 communities throughout the State. Its customers enjoy,
as a necessary concomitant of a well-established, large,
efficiently organized bank, all the benefits of a full-service commercial bank. It is able to offer complete
commercial banking services and has available the
skilled, experienced management to render these services. This has been no small factor in the tremendous
growth which Norfolk has enjoyed in the past and can
play an ever increasing role in the future economic
expansion of the entire State of Virginia.
Buena Vista, location in central Virginia about 125
miles west of Richmond, has a population of 6,300
while surrounding Rockbridge County has 24,039.
The major source of income for the area is derived
from manufacturing activity. It is estimated that
there are 3,650 people of a total work force of 10.370
employed in manufacturing, with the textile industry
alone employing 2,850 persons. There were 18 construction, 14 manufacturing, 69 trade, and 27 service
establishments in Rockbridge County at the close of
the second quarter of 1961. The average per capita
income in 1960 for Rockbridge County was $1,345
while that of the State was $1,868.
Peoples Bank of Buena Vista, Inc., is the only bank
in that city aside from the merging bank. Although
it is only a $2.1 million institution, its affiliation with
Financial General Corp., a holding company, makes
its competitive ability much stronger than would appear from its total assets. Other competing banks are
the $3.7 million First National Bank of Lexington,
Lexington, Va., located 6 miles from Buena Vista (also
affiliated with Financial General); the $7.5 million




Peoples National Bank of Lexington; and the $7.2 million Rockbridge National Bank of Lexington.
Since Virginia National's closest offices to First National are its two branches in Staunton, 34 miles north
of Buena Vista, this merger will not eliminate any cognizable amount of competition. The impact of the
merger on other banks in the area will be insignificant
as the other banks are either well established and adequately serving their respective communities or are
associated with a bank holding company. The resulting bank will certainly offer increased competition
to the many nonbanking financial institutions which
now serve the area.
The First National B;ank of Buena Vista is now operating at a competitive disadvantage since it neither
offers a full range of banking services to its community
nor possesses a management echelon capable of the
leadership required to meet the competitive conditions
of our present-day banking markets. The bank resulting from this merger will not only have resources
adequate to the needs of the Buena Vista market but
will also correct the management deficiencies now
harassing the First National Bank. This merger
should constitute a constructive contribution toward
the solution of the problems of economic stagnation
which now afflict the Appalachian region.
Having applied the statutory criteria to the facts of
this case, we find that the proposed merger will be in
the public interest. The application is therefore approved.
APRIL 2,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Virginia National is the second largest bank in Virginia and the dominant bank in its primary service area
which includes Norfolk, the largest industrial area in
the State. As of December 13, 1963, assets were
$404,815,000, loans were $224,966,000, deposits were
$374,191,000 and capital accounts were $32,747,000.
Virginia National presently has 43 banking offices in
20 communities throughout the State of Virginia.
The First National Bank of Buena Vista is located
214 miles northwest of Norfolk and, as of December
13, 1963, had total assets of $4,855,000, loans of
$2,813,000, deposits of $4,233,000 and capital accounts
of $471,000.
Standing alone, the effect of this proposed merger
on competition may not be significantly adverse. However, since 1956, Virginia National has participated in
six mergers and consolidations, five of which were consummated in 1963. These mergers have given Vir87

ginia National, as of the dates of acquisition, more
than $173 million in deposits and 32 branch offices,
or nearly 50 percent of its present deposits and more
than 65 percent of its present offices. In addition, an
application has recently been filed to merge the Southern Bank of Commerce, Danville, Va., a bank with
resources of $2,760,000.

It is the cumulative effect of the series of mergers
engaged in by Virginia National that is of concern to
this Department. It is our view that the overall effect
of this series of mergers on competition is adverse since
it contributes substantially to the serious trend toward
concentration of banking which is taking place in the
State of Virginia by virtue of the merger process.

THE ROCKINGHAM NATIONAL BANK OF EXETER, EXETER, N.H.,
NEWMARKET, N.H.

AND THE NEW MARKET NATIONAL BANK,

Banking offices
Total assets

Name of bank and type of transaction

In
operation
The New Market National Bank, Newmarket, N.H. (1330), with
and the Rockingham National Bank of Exeter, Exeter, N.H. (12889), which
had
merged Apr. 3, 1964, under charter and title of the latter bank (12889). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On January 1, 1964, the $9.5 million Rockingham
National Bank of Exeter, Exerter, N.H., and the $3.6
million New Market National Bank, Newmarket, N.H.,
applied to the Comptroller of the Currency for permission to merge under the charter and title of the former.
The applicant banks are located in Rockingham
County in the southeastern corner of New Hampshire.
Exeter, the county seat, has a population of 7,243 and
an estimated service area population of 23,000. Situated 8 miles north of the Massachusetts border and
7 miles south of Newmarket, Exeter has a varied industrial economy with promise of greater economic
development. It is also the site of Phillips Exeter
Academy, one of the country's leading preparatory
schools. The naval shipyard at Portsmouth and the
Pease Air Force Base, both within 15 miles of Exeter
and Newmarket, provide additional economic support
for the area.
Newmarket has a population of 3,153 and serves an
area of 12,450. Its main industries are shoe manufacturing, textiles and a mica products concern. Both
Exeter and Newmarket expect to benefit by the expanded recreational facilities of the coastal towns
which are but 10 miles distant.
The general area served by the charter bank encompasses five other banking institutions, the largest of
which is the $16.6 million Exeter Banking Co. The
resulting bank, with total resources of $13.1 million,
will be the second largest in the area. Other compet88




To be
operated

$3, 640, 775

1

9, 570, 223

1

13, 210, 998

2

ing institutions are the $2 million Hampton National
Bank, Hampton and three cooperative banks with no
branches and approximately $18.5 million in withdrawable assets.
In the Newmarket area, the merging bank has a
minimal amount of competition from the $2.8 million
Durham Trust Co. located in Durham, 4 miles north
of Newmarket.
The 41 percent growth in the southeastern New
Hampshire area in the last decade indicates a demand
for banking services that can be met only by vigorous,
expanding institutions which will not be restricted by
a confining lending limit. A higher lending limit resulting from the merger will enable Rockingham National to meet the area's future demands. The Newmarket area will benefit from the merger, as the merging bank for several years has been forced to lay off a
substantial amount of loan paper due to lack of sufficient resources. The merger will remedy this situation, as well as a management succession problem.
There is no effective competition between the applying banks and there will be no adverse effect on banking competition in the area.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and
the application is therefore approved.
MARCH 26,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The Rockingham National Bank of Exeter, Exeter,
N.H., as of December 31, 1963, had reported total

assets of $9,527,000. In Exeter, Rockingham competes with a larger commercial bank and a cooperative
bank which has no demand deposits. In Rockingham's claimed service area it competes with three other
smaller banks, one of which is a cooperative.
The New Market National Bank at Newmarket,
N.H., 7 miles north of Exeter, as of December 31,
1963, had reported total assets of $3,645,000. It operates in a separate service area. The community of
Newmarket has no other bank. The only direct competitor is another bank of comparable size in Durham,
4 miles distant. Competition between Rockingham
and New Market apparently exists minimally only on
the line dividing their respective service areas.

Rockingham and New Market are controlled by the
same holding company, New Hampshire Bank Shares,
and the contemplated merger, thus viewed, would not
alter the picture substantially except to improve the
lending power of the resulting bank. However, New
Hampshire Bank Shares, the only bank holding company in the State, which controls seven banks holding
12.8 percent of total commercial bank deposits, will
obtain branching advantages to add to its holding company position.
In the circumstances of this case, the combining of
holding company and branching advantages in one organization may result in adverse effects upon
competition.

THE DELTON STATE BANK, DELTON, MICH., AND THE FIRST NATIONAL BANK & TRUST CO. OF KALAMAZOO,
KALAMAZOO, MICH.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Delton State Bank, Delton, Mich., with
was purchased Apr. 18, 1964, by the First National Bank & Trust Go. of
Kalamazoo, Kalamazoo, Mich. (191), which had
After the purchase was effected, the receiving bank had

COMPTROLLER'S DECISION

On February 11, 1964, the $107 million First National Bank & Trust Co., Kalamazoo, Mich., applied
to the Comptroller of the Currency for permission to
purchase the assets and assume the liabilities of the
$2 million Delton State Bank, Delton, Mich.
The purchasing bank presently operates 11 branches
with 6 additional offices approved and under construction in the Kalamazoo area. Competition in the Kalamazoo area is provided by the $80 million American
National Bank & Trust Co., the $39 million Industrial
State Bank, and the $11 million Home Savings Bank
of Kalamazoo.
Kalamazoo, headquarters for the purchasing bank,
is a city of 85,000, with a rapidly increasing trading
area of 300,000 people. It is located in the southwestern section of Michigan's lower peninsula. Served by
excellent transportation facilities, the city has an economy well diversified between industry and agriculture.
The $2 million selling bank is located 20 miles
northeast of Kalamazoo in Delton, a town of 380, in
Barry County, Mich. It operates without local competition and provides only limited services. The
economy of this area is predominantly agricultural,
779-563—^5

7




To be
operated

$2, 039, 579

1

109, 367, 693
111,283,890

17
18

although numerous lakes in the area provide resort and
recreational activities.
The effect of the addition of $2 million of assets to
the $107 million now held by the buying bank will be
slight in the areas it now serves. Bank competition in
Delton, where there are no other banks, comes from
two small institutions in Hastings, 18 miles northeast.
Consequently, the competitive effect in Delton would
be deminimis.
There will be no elimination of competition between
the two banks, as the nearest branch of First National
is located 14 miles northeast of Delton at Parchment.
The public interest will be best served by a local unit
of First National which will furnish Delton and the
Barry County banking public with extensive trust
services, new aggressive management, and a greatly
enlarged lending capacity. In addition, a management succession problem, occasioned by the imminent
retirement of the president of the Delton bank, will be
solved.
Considered in the light of the statutory criteria, we
find the application to be in the public interest and the
purchase of assets and assumption of liabilities is,
therefore, approved.
APRIL 10,

1964.

89

SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed acquisition of assets and assumption
of liabilities of Delton State Bank by the First National
Bank & Trust Co. of Kalamazoo will have no competitive impact in the service area of the acquired bank
where Delton Bank is now the only commercial bank.
It will eliminate little direct competition now existing
between the two banks since their service areas show
only an insignificant overlap. The competitive posi-

tion of First National in its own service area will be
somewhat strengthened, but it is not believed that the
other commercial banks competing with First National
will be at a significant disadvantage in the combined
service area as a result of the proposed acquisition.
Thus, the effect of the proposed acquisition upon
competition would not appear to be substantially adverse except that it would add to the position of dominance presently enjoyed by First National.

THE MCDOWELL NATIONAL BANK OF SHARON, SHARON, PA., AND THE FIRST NATIONAL BANK, SHARPSVILLE, PA.
Banking offices
Total assets

Name of bank and type of transaction

In
operation
The First National Bank of Sharpsville, Sharpsville, Pa. (6829), with
was purchased Apr. 18, 1964, by the McDowell National Bank of Sharon,
Sharon, Pa. (8764), which had
After the purchase was effected, the receiving bank had

COMPTROLLER'S DECISION

On February 3, 1964, the McDowell National Bank
of Sharon, Sharon, Pa., applied to the Comptroller of
the Currency for permission to purchase the assets and
assume the liabilities of the First National Bank,
Sharpsville, Pa.
The city of Sharon, located in western Pennsylvania
at the Ohio border, is in the southwest section of Mercer County. With a metropolitan population of
35,000, Sharon is the commercial center of the Shenango Valley industrial area. The economy in the
area is industrial with steel production and fabrication
predominating. All of the Shenango Valley is classified as an area of persistent and substantial unemployment. Present unemployment is estimated at 6.8 percent of the total work force.
The $36 million McDowell National Bank of Sharon
with three offices, and three more approved but not
opened, is the largest bank with its main office located
in the service area. Two larger banks both with main
offices in Oil City, Pa., the $75 million First Seneca
Bank & Trust Co. with 12 offices and the $70 million
Northwest Pennsylvania Bank & Trust Co. with 12
offices, have branched into the service area. The First
Seneca Bank & Trust Co. has four offices in the city of
Sharon with a fifth office in nearby Mercer. In addition there are three other banks ranging from the $3

90




To be
operated

$6, 220, 301

1

38,666,122
43, 456, 637

3
4

million First National Bank of West Middlesex to the
$30 million First National Bank of Mercer County
that compete in the purchasing bank's service area.
The Borough of Sharpsville, 4 miles northeast of
Sharon, has a population of slightly over 6,000 and has
substantially the same socioeconomic makeup as
Sharon. Although the $6 million First National Bank
of Sharpsville is the only bank in Sharpsville, the First
National Bank of Mercer County, Greenville, Pa., has
received permission to establish a branch in Sharpsville. The selling bank is not competitive. For example, it has lost substantial deposits in the last 5 years
because it pays only 1 percent interest on passbook accounts. The purchasing bank currently pays 3 percent on savings deposits. The increased competitive
situation created by the presence of the above-mentioned branch will exert continued and increasing pressure on the deposits and activity of the First National
Bank. The purchase will be of direct benefit to the
depositors by increasing the interest rates on time deposits, and to the public, by the establishment of a
vigorous competitive banking community in Sharpsville. A management succession problem in the selling bank will be solved, and full banking services, as
well as efficient trust services will be available to the
Sharpsville area.
In applying the statutory criteria to the proposed
purchase of assets and assumption of liabilities, we con-

elude that it will be in the public interest. The application is therefore approved.
APRIL 10,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

In this transaction the bank which is the largest in
terms of the banking business conducted in the southwest portion of Mercer County proposes to purchase
this area's sixth largest bank. There is presently existing between these banks a fair degree of competition
which would, of course, be eliminated by this transaction. It would also remove another apparently
viable independent bank from an area that has already
seen the disappearance of several independents.
After purchase of the Sharpsville bank by McDowell,
the resulting bank would account for about 30 percent

of the banking business in southwest Mercer County
and, together with the next two banks, would account
for about 75 percent thereof. This appears to be a high
degree of concentration. However, the third and fifth
banks are much larger than McDowell in terms of
overall business, while the smallest bank is allegedly
owned in part by officers and directors of the second
bank. There would, therefore, not appear to be unusual disparity in size among these banks. Three of
the five existing independent banks in Mercer County
which operate outside McDowell's service area would
not appear to be directly affected by this transaction,
although they may find it increasingly expedient to
merge with other banks in the county.
It is our conclusion that the probable effect of this
transaction on competition will be adverse.

THE FIRST NATIONAL EXCHANGE BANK OF VIRGINIA, ROANOKE, VA., AND THE FIRST NATIONAL BANK OF LEBANON,
LEBANON, VA.
Banking offices
Name of bank and type of transaction

Total assets
To be
operated

In
operation
The First National Bank of Lebanon, Lebanon, Va. (6886), with
and the First National Exchange Bank of Virginia, Roanoke, Va. (2737),
which had
merged Apr. 24, 1964, under charter and title of the latter bank (2737).
The merged bank at the date of merger had . ,

COMPTROLLER'S DECISION

On March 9, 1964, the $202 million First National
Exchange Bank of Virginia, Roanoke, Va., and the
$9.1 million First National Bank of Lebanon, Lebanon,
Va., applied to the Comptroller of the Currency for
permission to merge under the charter and with the
title of the former.
Roanoke, with a population of about 100,000 inhabitants, is the fourth largest city in the Commonwealth and the industrial and trade center of southwest Virginia. In addition to the charter bank, the
banking needs of the city are also served by the $53.5
million Colonial American National Bank and the
$40.8 million Mountain Trust Co. A branch of the
$184.2 million Bank of Virginia in Roanoke and banks
in Salem, adjoining Roanoke, complete the competitive banking structure of the Roanoke city area.
Lebanon, seat of Russell County, is about 150 miles
southwest of Roanoke in southwest Virginia. The
town has a population of 2.000 in a trade area of
30,000 dependent on farming, i.e., tobacco and beef




$8, 513, 321

1

205,164,466

19

213,427,071

20

cattle, for 75 percent of its income, and on coal mining
for the other 25 percent. From 1950 to 1960, the
population of Lebanon increased from 675 to 2,000
inhabitants due largely to the construction of a large
coal generating plant of Appalachian Power Co. in the
area. A local garment manufacturing plant employs
about 350 women.
Until recently the First National Exchange Bank of
Virginia operated solely in Roanoke. In recent years,
however, the bank has grown from $107 million in total
resources to $202 million principally through the
acquisition of banks throughout Southwestern Virginia.
As a result of the transition from a local to a regional
bank, the First National Exchange Bank of Virginia
now competes more effectively with other regional and
statewide banking institutions such as First & Merchants National Bank, Virginia National Bank, United
Virginia Bank Shares, a registered bank holding company system, the Wachovia Bank & Trust Co., the
North Carolina National Bank, and the Bank of
Virginia.
91

Although the First National Bank of Lebanon is the
only bank in Lebanon, it competes with two other
banks in Russell County, namely, the $3.9 million First
National Bank in Honaker, and the $2.1 million Bank
of Russell County, at Cleveland. It has no trust department, and has traditionally adhered to very conservative lending policies, referring larger loans to the
Production Credit Association at Abingdon, a government lending agency.
The two applicant banks are not competitors since
the nearest offices of the charter bank are its three
branches in Bristol, about 35 miles southwest of Lebanon. The resulting bank will bring to the merging
bank's area trust services, a higher lending limit, more
liberal lending policies, and the benefits of the farm
credit service department of the charter bank. The
entry of a large, full-service, regional bank into Russell
County will stimulate the local economy by providing
a larger, more liberal source of funds for local
development.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is, therefore, approved.
APRIL 23,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Exchange Bank, one of the largest banks in the State
of Virginia, with assets of $202 million, seeks to acquire First National Bank of Lebanon, a bank with
assets of $9 million, located in a small community in
southwestern Virginia. In the span of a few short
years, Exchange Bank has expanded its operations by
acquiring six banks, four of which are located on a line
running southwest from Roanoke to Bristol. These
acquisitions have given Exchange Bank a substantial
foothold into an area which traditionally enjoyed the
competition of many small- and intermediate-size institutions. The proposed acquisition is but another in
a series of bank acquisitions in southern Virginia.
Such a merger movement can only add to the rapid
trend toward concentration of banking assets in the
State of Virginia. In turn, it can only decrease the
competitive viability of smaller independent banks, to
the detriment of long-range competition in the area.
The proposed acquisition will have an adverse effect
upon competition and the effect on competition of
continuing acquisitions by the acquiring bank will be
seriously adverse.

T H E FIRST NATIONAL EXCHANGE BANK OF VIRGINIA, ROANOKE, VA., AND THE FIRST NATIONAL BANK OF
RlCHLANDS, RlCHLANDS, V A .
Banking offices
Total assets

Name of bank and type of transaction

The First National Bank of Richlands, Richlands, Va. (10850), with
and the First National Exchange Bank of Virginia, Roanoke, Va. (2737),
which had
merged Apr. 24,1964, under charter and title of the latter bank (2737). The
merged bank at the date of merger had
COMPTROLLER'S DECISION

On March 9, 1964, the $202 million First National
Exchange Bank of Virginia, Roanoke, Va., and the
$14.5 million First National Bank of Richlands, Richlands, Va., applied to the Comptroller of the Currency
for permission to merge under the charter and with the
title of the former.
Roanoke, with a population of about 100,000, is the
fourth largest city in the Commonwealth and the industrial and trade center of southwest Virginia. In
addition to the charter bank, the banking needs of the
city are also served by the $53.5 million Colonial American National Bank and the $40.8 million Mountain
92




In
operation

To be
operated

$14, 372, 920

1

191,263,269

18

205,164,466

19

Trust Co. A branch of the $184.2 million Bank of
Virginia in Roanoke and the banks in Salem, adjoining Roanoke, complete the competitive banking structure of the Roanoke City area.
Richlands, a town of about 5,000 some 160 miles
west of Roanoke, is located in Tazewell County on the
West Virginia border. Located in the large geographic area known as Appalachia, it is experiencing
acute depression brought about by mechanization and
automation of the coal mining industry. Although
Inland Creek Coal Co. and Republic Steel Co. are expanding deep mining facilities in the area, these operations will be automated, employing skilled persons
with little absorption of the local unskilled labor supply.

Feeder cattle grazing and tobacco farming add little to
the economy.
Until recently, First National Exchange Bank operated solely in Roanoke. Since I960, however, the
bank has grown from $107 million in total resources to
$202 million principally through the acquisition of
banks throughout southwest Virginia. As a result of
the transition from a local to a regional bank, First
National Exchange Bank now competes more effectively with other regional and statewide banking institutions such as First & Merchants National Bank,
Virginia National Bank, United Virginia Bankshares,
a registered bank holding company system, the Wachovia Bank & Trust Co., the North Carolina National
Bank and the Bank of Virginia.
The First National Bank of Richlands has been active in its area in financing local businesses, consumer
lending and mining equipment loans. This bank is one
of six banks in Tazewell County and averages about
40 percent of loan volume and 31 percent of deposits
in the area. Management, however, is concentrated
in the hands of the president who will soon be 70 years
old and there is no experienced successor to replace
him. This lack of successor management has motivated the board of directors to consider the merger
with the Roanoke bank in order to have access to its
pool of young, trained executive personnel.
The two applicant banks are not competitors. Consummation of the proposed merger will neither reduce
competition nor adversely affect the banking structure
of the areas served by either bank. On the contrary,
the resulting bank will dispose of the merging bank's

management succession problem and improve banking
services and general economic conditions in Tazewell
County by making available greater resources of credit
capable of financing economic progress in the area.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is, therefore, approved.
APRIL 23, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Exchange Bank, with home offices in Roanoke, has
18 offices and $202 million in assets. It now seeks to
acquire an independent bank with assets of $14,451,000 located in the city of Richlands, 162 miles west of
Roanoke. In a companion application, Exchange
Bank is seeking approval to acquire another small bank
in Lebanon, 28 miles from Richlands.
Since 1960, Exchange Bank has acquired six banks,
four of which are located on a line running southwest
from Roanoke to Bristol. These acquisitions have
given Exchange Bank a substantial foothold into an
area which traditionally has enjoyed the competition
of many small- and intermediate-size banks. The proposed acquisition is but another in a series of bank
acquisitions in southern Virginia. Such a merger
movement can only add to the rapid trend toward
concentration of banking assets in the State of Virginia.
In turn, it can only decrease the competitive viability
of smaller independent banks, to the detriment of longrange competition in the area. We therefore conclude
that the proposed acquisition will have an adverse
effect upon competition.

THE WINCHESTER NATIONAL BANK, WINCHESTER, N.H., AND THE CHESHIRE NATIONAL BANK OF KEENE,
KEENE, N.H.
Banking offices
Total assets

Name of bank and type of transaction

In
operation

The Winchester National Bank, Winchester, N.H. (887), with
was purchased Apr. 24,1964, by the Cheshire National Bank of Keene, Keene,
N.H. (559), which had
,
After the purchase was effected, thf receiving bank had
COMPTROLLER'S DECISION

On January 29, 1964, the $8.6 million Cheshire
National Bank of Keene, Keene, N.H., applied to the
Comptroller of the Currency for permission to purchase the assets and assume the liabilities of the $2.2
million Winchester National Bank, Winchester, N.H.




To be
operated

$2, 268, 050

1

8,650,166
10, 644, 215

1
2

Keene, the site of the acquiring bank and the county
seat of Cheshire County, has a population of 17,562.
The city is the primary retail sales center for the greater
part of southwestern New Hampshire. The service
area economy of the Cheshire National Bank is predominately based on light industry, with farming and
lumbering of somewhat lesser importance.
93

Winchester, in which the selling bank is located, is
approximately 14 miles southwest of Keene in Cheshire
County and less than 5 miles north of the Massachusetts State border.
Its economy is based upon retail sales and light industries of long standing in the area. The Winchester
population of 2,411, together with the entire economic
structure of the community, has shown little change
over the past 20 years. This stagnation is due in no
small part to the inadequate banking facilities at present available to residents and prospective industries.
Elimination of competition will be negligible, since
the service areas of the present banks do not overlap.
Competition will instead be strengthened throughout
all of southwestern New Hampshire, as the resulting
bank will be better able to compete effectively with
other financial institutions in the area. In addition to
three commercial banks in the area, one of which is
larger than the resulting bank, there are at present two
mutual savings banks, with withdrawal balances of $26
and $12 million respectively, a cooperative bank, an
active savings and loan association, several credit
unions, and six personal loan companies. These institutions are, for the most part, aggressive, well-managed, and better able to meet the eocnomic needs of
the communities.

Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is, therefore, approved.
MARCH 31, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Cheshire National Bank of Keene, Keene, N.H.,
with resources of $8,650,165, proposes to purchase the
assets and acquire the liabilities of the Winchester National Bank, Winchester, N.H., with resources of
$2,268,049.
Winchester National's very modest size, plus the
static economic condition prevailing in its area, taken
together with the fact that the acquisition would
eliminate little direct competition between the participating banks, tend to minimize the anticompetitive
effects of the proposed merger. On the other hand,
the substantial increase in the percentage of deposits
and loans held by Cheshire National, the advance of
Cheshire from second to the position of the largest
bank in the area, the resulting high level of concentration and the fact that the merger would leave the Winchester area without an independent bank lead to the
conclusion that the effect of the proposal upon competition would be adverse.

PEOPLES NATIONAL BANK & TRUST CO. OF BAY CITY, BAY CITY, MICH., AND STATE BANK OF LIN WOOD, LINWOOD,
MICH.
Banking offices
Name of bank and type of transaction

Total assets

To be
operated

In
operation
State Bank of Linwood, Linwood, Mich.., with
and Peoples National Bank & Trust Go. of Bay City, Bay City, Mich. (14641),
which had
merged Apr. 25, 1964, under charter and title of the latter bank (14641).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On February 28, 1964, the $101 million Peoples
National Bank & Trust Co. of Bay City, Bay City,
Mich., and the $3.6 million State Bank of Linwood,
Linwood, Mich., applied to the Comptroller of the
Currency for permssion to merge under the charter
and with the title of the former.
Bay City, with a population of about 55,000 inhabitants, is the retail and wholesale center of a service area
of about 88,000. It is located approximately 100
miles north of Detroit in the northeast portion of an
94




$3, 542, 358

1

99,150, 775

7

102, 693,133

8

area known as the Saginaw-Bay City-Midland region,
and is served by the port of Bay City, which, in terms
of gross tonnage, is one of the principal ports on the
Great Lakes. Industry in Bay City is diversified and
includes the manufacturing of such products as cranes,
naval vessels, freighters., power shovels, and automobile
parts. The Chevrolet Division of General Motors is
the largest employer in the area. Surrounding Bay
City on the east, south, and southwest is a rich agricultural section producing large quantities of sugarbeets,
potatoes, beans, and cantaloups.

Linwood, located in the same trade area as Bay City,
is about 13 miles north of Bay City. The economy of
the area is primarily agricultural, producing crops of
sugarbeets, beans, wheat, and cucumbers. A large
number of its inhabitants commute to Bay City, Midland, and Saginaw to work in the plants of Dow
Chemical and General Motors.
The charter bank is a full-service institution, operating five branches in the Bay City area and one branch,
Pinconning, about 22 miles north of the main office.
It is the largest of the three commercial banks in the
area. The other commercial bank in Bay City, the
$25 million Bay City Bank, has two branches.
The merging bank is the only bank in Linwood. It
offers neither trust services nor consumer credit.
Moreover, it suffers a management problem.
The proposed merger will be of primary benefit to
the Linwood area public. Whereas the bank in Linwood is too small to serve the needs of the area, the
resulting bank will bring modern banking services to
the community and will act as a stimulant to the local
economy. In addition to making trust services and
expanded commercial and consumer credit available,
the consummation of the proposed merger will solve
the management succession problem facing the merging bank.

As there is very little competition between the charter and merging banks, the merger will not alter the
competitive banking structure in the Bay City area to
any significant degree. Bay City Bank, and a local
savings and loan association with withdrawable accounts of $40 million, will continue to offer competition.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and the
application is, therefore, approved.
APRIL 24,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger of State Bank of Linwood,
Linwood, Mich., into Peoples National Bank & Trust
Co. of Bay City, Bay City, Mich., would eliminate some
competition presently existing between the two banks.
More significantly, it would increase National Bank's
share of total IPC deposits to 80 percent and of loans
and discounts to 77 percent, thus seriously threatening
the only other bank now competing with National
Bank in the Bay City area.
Because of the cumulative effect of prior mergers in
the Bay City area and the excessive concentration already existing there, the effect of the proposed merger
between these two banks would appear to be seriously
adverse to competition.

THE PENNSYLVANIA NATIONAL BANK & TRUST CO. OF POTTSVILLE, POTTSVILLE, PA., AND THE UNION NATIONAL
BANK OF MAHANOY CITY, MAHANOY, PA.
Banking offices
Name of bank and type of transaction

Total assets
To be

In
operation
The Union National Bank of Mahanoy City, Mahanoy City, Pa. (3997), with. . . .
and the Pennsylvania National Bank & Trust Co. of Pottsville, Pottsville, Pa.
(1663), which had
merged May 8, 1964., under charter and title of the latter bank (1663). The
merged tank at the date of merger had

COMPTROLLER S DECISION

On February 24, 1964, the $36 million Pennsylvania
National Bank & Trust Co. of Pottsville, Pottsville, Pa.,
and the $13 million Union National Bank of Mahanoy
City, Mahanoy City, Pa., applied to the Comptroller
of the Currency to merge under the charter with the
title of the former.
The applicant banks are located in Schuylkill
County, Pa., approximately 90 road miles northwest
of Philadelphia. The economy of Schuylkill County




operated

$13,951,362

2

37, 526, 608

7

51, 477, 970

9

was long dominated by the mining of anthracite coal.
When this industry began to suffer a decline some 30
years ago, the local economy suffered. Accordingly,
the population of Schuylkill County has declined from
228,331 in 1940 to 173,027 at the present time. However, great efforts have resulted in the development of
a diversified economy. Aluminum processing, the
fabrication of steel products and cigar manufacturing
are now major industries.
The Charter Bank's head office is located in Pottsville, the seat and largest city, population 21,659 of
95

Schuylkill County. It operates 5 in-county branches
and 1 branch in Columbia County. At present, it competes aggressively with the 25 banks located within the
trade area which closely approximates the boundaries
of Schuylkill County.
The $13 million Merging Bank has its head office in
Mahanoy City some 13 miles from Pottsville. Broad
Mountain is situated directly between these two cities
and its barrier effect tends to sever them from each
other. The result is that virtually no competition exists
between the two banks.
Mahanoy City experienced a population decline to
8,536 from 10,934 in the past decade. It is estimated
that 1,400 of its present inhabitants receive some form
of public assistance. This picture is brightened by the
employment of 1,000 men in the surrounding coal
fields and 540 in a cigar plant.
The Charter Bank has actively participated in the
strenuous efforts being made to develop new industry
in the area. Twenty-five percent of its loan portfolio
is in local industrial and commercial loans as against
3 percent for the Merging Bank. Because of its lending limit the Charter Blank has been forced to participate three recent loans.

The $50 million Resulting Bank will continue to operate the Merging Bank's two offices as branches.
The merger will also provide a stronger local bank to
meet the intense competition which will be introduced
by the merger of the small Schuylkill Trust Co. into
the $198 million Berks County Trust Co. whose home
office is Reading, Pa. It will solve the acute management problem now facing the Merging Bank. Its
three executive officers have all passed retirement age
and now wish to retire.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is therefore approved.
MAY 1, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

This proposal would extend Pennsylvania National's
service area to all of Schuylkill County, Pa., and would
give it a countywide dominance. Moreover, the survival of the American Bank, Union's only competitor
in Mahanoy City, as a vital competitive factor would
be greatly jeopardized. The proposed merger would
appear to have a significantly adverse effect upon
competition.

LAFAYETTE NATIONAL BANK, LAFAYETTE, IND., AND THE BANK OF DAYTON, DAYTON, IND.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Bank of Dayton, Dayton, Ind., with
was purchased May 9, 1964, by Lafayette National Bank, Lafayette, Ind.
(14175), which had
After the purchase was effected, the receiving bank had

COMPTROLLER'S DECISION

On March 4, 1964, the $46.9 million Lafayette National Bank, Lafayette, Ind., applied to the Comptroller of the Currency for permission to purchase the
assets and assume the liabilities of the $1.9 million
Bank of Dayton, Dayton, Ind.
Lafayette, with a population in excess of 42,000 inhabitants, is the hub of the rich agricultural area of
northern Indiana. Adjacent West Lafayette has a
permanent population of over 12,000 inhabitants and
a student population of 15,000 attending Purdue University. While the economy of Lafayette is based primarily on agriculture, some 15 industries contribute to
96




To be
operated

$1,385,916

1

46, 905, 000
48, 429, 000

4
5

its viability. In addition to the purchasing bank,
Lafayette is served by the $49.7 million Purdue National Bank of Lafayette, the $22.9 million Lafayette
Loan & Trust Co., and the $13.5 million Lafayette
Savings Bank.
Dayton, located about 8 miles southeast of Lafayette,
has a population of about 500 inhabitants who depend
primarily on agriculture for their livelihood. Some
residents of Dayton commute to and work in industrial
plants in nearby Lafayette.
The Lafayette National Bank operates two branches
in Lafayette, one branch in West Lafayette, and has an
additional branch under construction in West Lafay-

ette. With adequate capital and strong management,
it offers a full line of banking services.
The Bank of Dayton operates no branches and is the
only bank in Dayton. Nearly all its customers are
residents of Dayton and the surrounding agricultural
area. The lack of successor management personnel
qualified to operate the bank is one of the principal
reasons prompting its board of directors to approve the
sale.
As there is virtually no competition between Lafayette National Bank and the Bank of Dayton, the effect
of the purchase and assumption on the area banking
structure will not be noticed; the buying bank will
remain the second largest bank in Lafayette. A
significant change will, of course, take place in Dayton
where the selling bank will be replaced by a well-run
branch bank offering modern, low-cost, banking services and assistance in community promotion. Among
the services which will be offered in Dayton for the
first time will be consumer loans of all kinds, trust
services, more efficient handling of items, and in-

creased credit supplied by the much greater capital
structure of the purchasing bank.
Applying the statutory criteria to the proposed purchase and assumption, we conclude that it is in the
public interest and the application is therefore
approved.
May 1,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The acquiring bank^ Lafayette National, with 25.8
percent of total IPG deposits and 24.2 percent of total
loans, is the second largest bank in its service area
which comprises Lafayette and West Lafayette Counties. The bank of Dayton is a unit bank located in
a town of 503 population some 8 miles from Lafayette.
The competition between the participating banks appears to be minimal and the proposed acquisition of
the Bank of Dayton by Lafayette National will not
significantly affect the latter's market position.
The effect of the proposed purchase of assets and
assumption of liabilities on competition will not be
significantly adverse.

FIRST|NATIONAL BANK & TRUST CO. IN WAYNESBORO, WAYNESBORO, PA., AND THE FIRST NATIONAL BANK,
BLUE RIDGE SUMMIT, PA.
Banking offices
Name of bank and type of transaction

«m

Total assets

In
operation

To be
operated

» •*

The First National Bank of Blue Ridge Summit, Blue Ridge Summit, Pa. (12281),
with
and First National Bank & Trust Co. in Waynesboro, Waynesboro, Pa.
(11866), which had
merged May 9, 1964, under the charter and title of the latter bank (11866).
The merged bank at the date of merger had
COMPTROLLER S DECISION

On March 4, 1964, the $20.1 million First National
Bank & Trust Co. in Waynesboro, Waynesboro, Pa.,
and the $4.4 million First National Bank of Blue
Ridge Summit, Blue Ridge Summit, Pa., applied to
the Comptroller of the Currency for permission to
merge under the charter of the former and with the
title, "First National Bank and Trust Company."
Waynesboro is a community of 10,600 which serves
an estimated additional population of 10,000 within
a 10-mile radius. It is an industrial and commercial
trade center in an agricultural region in southern
Pennsylvania.
Blue Ridge Summit is a small mountain community




$4, 432, 923

1

19,757,539

1

24,190,461

2

located about 6 miles southeast of Waynesboro. It
has a population of 500 permanent residents augmented during the summer months by tourists from
Baltimore and Washington. The community is included in the general trade area of Waynesboro.
Nearby Fort Ritchie maintains large numbers of military personnel and their families who contribute to the
local economy.
The First National Bank & Trust Co. is a fullservice bank and the larger of two commercial banks
in Waynesboro. It also experiences competition in
its trade area from larger banks in Chambersburg, Pa.,
and in Frederick and Hagerstown, Md. Other banks
in Mont Alto, Pa., and Greencastle, Pa., offer additional competition.
97

The merging bank is the only bank in Blue Ridge
Summit. With a lending limit of $30,000, the bank
has, in recent years, participated in a number of loans
with the charter bank. It offers no trust services.
Although some competition between the two banks
will be eliminated by the merger, there will be no
tendency toward monopoly since the resulting institution will still face competition from banks in Waynesboro and in surrounding communities. Bank services
in the merging bank's trade area will be improved
through the introduction of trust services, consumer
credit, and a higher lending limit. Moreover, operating efficiencies will be achieved by both banks through
the joint use of equipment. The pooling of managerial
personnel will meet a latent succession problem beginning to appear in both banks.
Applying the statutory criteria, we conclude that the
merger is in the public interest and, therefore, the
merger is approved.
MAY 1, 1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The First National Bank & Trust Co. in Waynesboro, the town's largest bank with assets of over $20
million, deposits of over $16 million and loans of over
$9 million, proposed to acquire the First National Bank
of Blue Ridge Summit, the only bank in a town 6
miles distant from Waynesboro. The latter had, as of
December 31, 1963, total assets of $4,366,000, total deposits of $4,008,000, and net loans and discounts of
$1,987,000. Both banks operate no branches, provide
normal banking services on a relatively limited scale,
except that the latter does not maintain a trust
department.
The merger would eliminate competition between
the merging banks and increase the dominant position
of the Waynesboro bank in the immediate service area.
However, a number of banks will remain as alternate
sources of banking services in Waynesboro and surrounding areas. The effect of the merger on competition in the Waynesboro area would be adverse but in
the larger areas not substantially adverse.

CHERRY HILL NATIONAL BANK, CHERRY HILL, N.J., AND FIRST CAMDEN NATIONAL BANK & TRUST CO., CAMDEN,

N.J.
Banking offices
Total assets

Name of bank and type of transaction

In
operation
Cherry Hill National Bank, Cherry Hill, N.J. (14936), with
and First Camden National Bank & Trust Co., Camden, N.J. (1209), which
had
merged May 15, 1964, under charter and title of the latter bank (1209). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On March 12, 1964, the $175.8 million First Camden National Bank & Trust Co. of Camden, Camden,
N.J., and the $8.9 million Cherry Hill National Bank,
of Cherry Hill, N.J., applied to the Comptroller of the
Currency for permission to merge under the charter
and title of the former.
Camden County, in which the applicants are situated, forms part of the metropolitan Philadelphia complex. The county has enjoyed a rapid industrial and
residential expansion in the past decade. The city of
Camden, population 117,000 while following the national urban pattern of decreasing population, is a
highly diversified and important industrial center with
excellent transportation, manufacturing, and maritime




To be
operated

$7, 424, 859

3

169,477,653

13

176,902,512

16

facilities. Cherry Hill, a residential suburb of the city
of Camden, has exhibited excellent growth over the
past decade with its population increasing from 12,000
to 40,000. Cherry Hill Mall, a regional shopping center situated in Cherry Hill, has attracted national attention and has been instrumental in bringing both
new business and new residents to the township. Prospects for further expansion in the area seem favorable.
The charter bank, a regional bank with 10 offices
located in Camden County and 1 in Philadelphia,
serves that half of the metropolitan Philadelphia area
comprised of Philadelphia and 3 adjacent New Jersey
counties. A highly competitive banking structure has
evolved in that area with 53 commercial banks, ranging in size from the $1.46 billion First Pennsylvania
Banking & Trust Co. to the $1.2 million Marian Bank

& Trust Co., and hundreds of nonbank financial institutions, such as savings and loan associations, insurance companies, and sales finance companies.
The merging bank, with its two branches, is the
smallest unaffiliated bank serving Cherry Hill and
adjacent communities. Until recently, the merging
bank's excellent location in Cherry Hill Mall enabled
it to withstand strong competitive pressures from the
Camden Trust Co., the largest bank in southern New
Jersey, which heretofore had only one branch situated
on the periphery of Cherry Hill. Due to a pending
acquisition, however, Camden Trust Co. will soon have
two more branches operating in Cherry Hill, thus
transforming the present competitive structure. The
proposed merger should restore the competitive
balance.
Competition between the applicants is minimal.
The charter bank has retained or acquired the business
of those primarily interested in the special services of
a regional bank while the merging bank has acquired
the business of those primarily interested in the convenience of a local bank. This latter category includes
the residents and smaller commercial establishments in
the Cherry Hill area.
While the merging bank has been an aggressive,
competing element in the banking structure of its area,
it has been unable to provide adequately for the pressing demands resulting from the extraordinary growth
of its community. The bank has been unable to respond to numerous demands for loans in excess of its
present lending limit of $60,000. Its small resources
have inhibited new, convenient financing and trust
services, as well as expanded housing loans.

Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is, therefore, approved.
MAY 13, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

First Camden was established in 1812 and is the
second largest of 10 banks in Camden County, being
only slightly smaller than the Camden Trust Co. It
has 10 offices in Camden County and 1 in Philadelphia
and, as of December 31, 1963, had total assets of
$175,898,000, total deposits of $156,376,000, net loans
and discounts of $100,082,000, and total capital accounts of $10,415,000.
Cherry Hill National, chartered in 1961, has three
banking offices, all of which are located in Cherry Hill.
As of December 31, 1963, it had total assets of
$8,951,000, total deposits of $7,822,000, net loans and
discounts of $4,541,000, and total capital accounts of
$784,000.
Commercial banking in Camden County is already
highly concentrated, with First Camden and Camden
Trust Co. holding 74.19 percent of the deposits and
80.98 percent of the loans held by all banks in the
county. In addition, these two banks have 23 of the
42 banking offices presently located in the county.
In view of the direct competition which would be
eliminated and the increase in the already high level
of concentration in Camden County banking which
would result, it is our opinion that the effect of the
proposed merger on competition would be seriously
adverse.

FIRST BANK & TRUST CO., NATIONAL ASSOCIATION, FORDS, N.J., AND WOODBRIDGE NATIONAL BANK, WOODBRIDGE, N.J.
Banking offices
Total assets

Name of bank and type of transaction

To be
operated

In
operation
Woodbridge National Bank. Woodbridge, N.J. (14378), with
and First Bank & Trust Co., National Association, Fords, N.J. (15255), which
had
'
merged May 15, 1964, under the charter and title of the latter bank (15255).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On March 11, 1964, the $59.8 million First Bank
& Trust Co., National Association, Fords, N.J., and




$24,786,119

3

65, 568, 994
85, 733, 774

6

the $25.3 million Woodbridge National Bank, Woodbridge, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and
with the title of the former.
99

Fords, with a population in excess of 12,000, and
Woodbridge Township, with an estimated population
of 80,000, are located in the densely populated northern portion of Middlesex County, N.J., about 25 miles
from New York City. Fast commuter train service
and accessibility to the New Jersey Turnpike and the
Garden State Parkway permit a large number of people in this area to work in New York, and contribute
to the area's residential and industrial growth. Such
national industries as metals, chemicals, electronics,
and petroleum processing furnish employment to many
local inhabitants.
First Bank & Trust Co., National Association, a fullservice institution with a branch in Perth Amboy and
another in the town of Avenel, is the largest of 20 commercial banks in Middlesex County. Competition in
the county stems from 18 other banks with 37 offices,
exclusive of those of the merging bank. The charter
bank holds about 13.1 percent of county deposits, while
its largest competitors the $49.2 million First National
Bank of Middlesex County, South River, and the $50.6
million National Bank of New Jersey, New Brunswick,
hold 11.3 and 10.9 percent of deposits, respectively.
Woodbridge National Bank, operating one branch
at Avenel and another at Islin, maintains its home
office in Woodbridge, about 2.4 miles from Fords.
Approximately 99 percent of the merging bank's stock
is owned by the bank's president, whose family has the
controlling interest in the charter bank. The same
man is also the president of the charter bank. Prior
to the stock acquisition by the present owner, the
merging bank had been reluctant to offer a full line of
banking services, and although it had trust powers, it
did not exercise them.
Since the participating banks are already on a cooperative basis due to their common ownership, consummation of the proposed merger will hardly reduce
competition between them. No adverse effects of this
proposal are foreseeable in view of the extensive competition from numerous other commercial banks in the
same and adjoining counties. Moreover, 2 savings
banks with deposits aggregating $134.9 million and 14
savings and loan associations with share accounts of
$86 million afford substantial additional competition.
The resulting bank will realize significant savings
through more efficient use of bank operations and man-

300




agement. Consequently, it will be in a better position
to serve the expanding* industrial and commercial
needs of one of the fastest growing counties in New
Jersey.
Applying the statutory criteria to the above facts,
we conclude that the proposed merger is in the public
interest, and, the application is therefore approved.
MAY 13, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

First Bank & Trust Co.. is the largest bank in its service area. As of January 31, 1964, its assets were
$59,802,997, deposits $53,695,800, and loans and discounts $28,234,261.
Woodbridge National Bank is located 2.4 miles from
First Bank & Trust Co. As of January 31, 1964, its
assets were $25,340,724, deposits $22,988,450, and
loans and discounts $9,859,952.
The application states direct competition between
the two banks is not substantial, based on the fact that
the president of First Bank & Trust Co. purchased approximately 99 percent of the stock of Woodbridge
National Bank in January of 1964. This Department
cannot accept the premise that because of this stock
purchase direct competition which may have existed
prior to such stock purchase is no longer relevant.
The application contains no data relating to common depositors or borrowers, nor any data reflecting
the deposits and loans each bank obtained from the
service area of the other. It is obvious, however, that
substantial competition would exist between the merging banks, except for common ownership. The effect
of the merger would, of course, eliminate this competition for all time.
The application lists 20 banks (including the participating banks) in Middlesex County, which the application states is the major competitive area. First
Bank & Trust Co. is presently the largest of these banks
and after the proposed merger the resulting bank will
be roughly double the size of the number two bank,
measured by deposits and loans. Its present competitive advantage over each of these banks in Middlesex
County will be sharply enhanced after the proposed
merger.
It is our view that the effect of this proposed merger
on competition will be substantially adverse.

T H E CAROLINA BANK, GRANITF,VILLE, S.C., AND THE CITIZENS & SOUTHERN NATIONAL BANK OF SOUTH CAROLINA,
CHARLESTON, S.C.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Carolina Bank, Graniteville, S.G., with
and the Citizens & Southern National Bank of South Carolina, Charleston,
S.C. (14425), which had
merged May 23, 1964, under the charter and title of the latter bank (14425).
The merged bank at: the date of merger had
COMPTROLLER S DECISION

On March 16, 1964, the $164.8 million Citizens &
Southern National Bank of South Carolina, Charleston, S.C, and the $2.5 million Carolina Bank, Graniteville, S.C, applied to the Comptroller of the Currency
for permission to merge under the charter and with
the title of the former.
The charter bank operates in three principal areas
comprising 12 communities in South Carolina: The
Charleston area, with a population of 230,000, is
located in the southeastern section of the State; the
Columbia area, with a population of 200,000, is located in the central section; and the Spartanburg area,
with a population of 157,000, is located in the northwestern section. Since the charter bank operates
offices throughout the greater portion of the State,
its area of activity has a diversified economic base
which has been changing from an agricultural to an
industrial orientation. Federal Government activity
is an important factor in the economy of the Charleston and Columbia areas, while in the SpartanburgFlorence area? the economy is based on agriculture and
industry.
The merging bank is located in Graniteville, which
is an unincorporated community near Augusta, Ga.,
in the western portion of South Carolina with a service
area population of 7,500. Its economy is based primarily on the textile industry which employs more
than 2,000 area residents.
The charter bank is the second largest bank in South
Carolina, operating 7.3 percent of the State's commercial banking offices and holding 12.6 percent of the
total deposits. It is approximately one-half the size
of the State's largest bank and twice the size of the
third largest bank. The charter bank's offices closest
to the merging bank are 75 miles away in the Columbia area. There are no known common deposit or
loan accounts and neither bank has shared nor placed
any loans with the other during the preceding year.




$2, 432, 227
167,853,862

To be
operated

2
26

170,155,052

28

Although the merging bank is the only bank in
Graniteville, its small size puts it at a competitive disadvantage with larger banks located in Aiken, S.C,
and Augusta, Ga., 6 and 11 miles distant, respectively.
In addition, savings and loan associations, sales finance
and personal loan companies, life insurnce companies,
credit unions and direct lending agencies of the Government presently offer competition in the service areas
of the merging and charter bank. Considering the
proximity of other banks as well as the presence of
these institutions, alternative sources of credit are readily available to the residents.
Primary benefit to the residents of the GranitevilleNorth Augusta area will be the addition of an aggressive, efficiently run, full-service bank, operated by experienced and competent management. The modern,
automated equipment and efficient operating procedures of Citizens should substantially lower service costs
to the customers of the bank. The residents will also
benefit from the trust department services of the charter bank since trust services are not presently being
offered by the merging bank.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
MAY 14, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Citizens & Southern is the second largest of 4 statewide commercial banks in South Carolina with about
14 percent of the State's deposits and 24 offices located in 7 different areas in the State. At the present
time it has pending a separate application to merge
with a unit bank in northeast South Carolina. Carolina Bank has two offices located in Graniteville and
North Augusta, S.C, respectively, about 60 miles
southwest of Citizens & Southern's nearest offices in
Columbia, S.C. Its total deposits are $2,192,000, less
101

than 1 percent of the total deposits of all banks in the
State.
There appears to be no actual competition between
the merging banks due to the distance which separates
their respective offices. Carolina Bank is the only
bank in Graniteville, but its branch in North Augusta
faces competition from North Augusta Banking Co.,
which operates the only other bank office in that community. The merger, therefore, would subject North
Augusta Banking Co., with deposits of only $4,338,000,

to direct competition with a branch of the much larger
Citizen & Southern system, At the same time it would
constitute one more step in a series of acquisitions by
the four largest South Carolina banks which threatens
to transform the State's banking industry into a small
number of giant, statewide institutions.
We conclude that the proposed merger, standing
alone, would not have a significant adverse effect upon
competition but as part of a trend toward further concentration is adverse.

THE CITIZENS & SOUTHERN NATIONAL BANK OF SOUTH CAROLINA, CHARLESTON, S.C., AND CITIZENS BANK OF
DARLINGTON, DARLINGTON, S.C.
Banking offices
Name of bank and type of transaction

Total assets

Citizens Bank of Darlington, Darlington, S.C, with
and the Citizens & Southern National Bank of South Carolina, Charleston,
S.C. (14425), which had
merged May 23, 1964, under charter and title of the latter bank (14425).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On March 19, 1964, the $166.5 million Citizens &
Southern National Bank of South Carolina, Charleston, S.C, and the $5.7 million Citizens Bank of Darlington, Darlington, S.C, applied to the Comptroller
of the Currency for permission to merge under the
charter and with the title of the former.
Charleston, with a population of 66,000, located in
Charleston County with a population in excess of
216,000, is an important South Atlantic port and military center. Its excellent harbor facilities attract considerable international trade and provide a repair
station for both commercial and naval ships. Large
quantities of the State's agricultural products and seafoods are marketed in Charleston. The pace of industrial activity is reflected in the doubling of the value
of manufactured products during the past 10 years.
Darlington, seat of Darlington County, is located in
the northeastern part of the State. Its population is in
excess of 6,700 and the county population is over
53,000. Industry in Darlington consists of an electronics manufacturing plant, employing about 1,100
people, a paper-cup plant, a veneer plant, and a small
manufacturer of women's apparel. The surrounding
rural area is devoted principally to cotton, tobacco,
and soybean cultivation.
102




In
operation

To be
operated

$5,611,686

2

170,155, 052

28

175,735,790

30

Citizens & Southern National Bank is the second
largest of four statewide commercial banks in South
Carolina. It maintains its principal office in Charleston and has 23 branches located in 7 different areas
in the State, including 2 branch offices in Florence, 10
miles southeast of Darlington. Its two largest competitors are the $335.8 million South Carolina National
Bank of Charleston and the $115 million First National Bank of South Carolina in Columbia.
The bank's only competitor in Darlington was recently acquired as a branch by the First National Bank
of South Carolina. Other competition is offered by
four branches of South Carolina National Bank and
by the Guaranty Bank & Trust Co. with its main office
and two branches in nearby Florence.
Since there is virtually no competition between the
applicant banks, consummation of the proposed merger will not reduce competition nor serve to promote
monopoly. Moreover, the people of Darlington will
have available the modern banking services of another
statewide institution, further stimulating competition
in the area. Availability of the charter bank's personnel will insure continued good management.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and
the application is therefore approved.
MAY 15, 1964.

tion and remaining unit banks in nearby communities
have been subjected to direct competition with offices
of much more powerful institutions.
The proposed merger is the most recent in this
process, which, if unchecked, threatens to concentrate
South Carolina's banking resources in a small number
of large branch systems. This application was made
shortly after, and appears to be a direct result of, an
application by one of Citizens & Southern's closest
competitors to acquire the other Darlington bank. Together with the latter acquisition, the proposed merger
would tend to motivate the other statewide systems to
respond with similar acquisitions, and those smaller
banks now in most direct competition with Citizens
might consider such a proposal to insure their survival
in competition with Citizens & Southern. At the same
time the merger would eliminate some direct competition between the applicants in the Darlington-Florence
area, where Citizens has about 13 percent, and Citizens
& Southern about 9 percent, of the area's deposits,
If the merger is approved, in less than 3 years that area
will have lost three of its four local, independent banks
through mergers with statewide systems.
In view of the bank merger history in South Carolina, the proposed merger threatens to have a serious
adverse effect upon competition and may aggravate
the trend toward oligopoly and monopoly in that State.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Citizens & Southern is the second largest of 4 statewide commercial banks in South Carolina with about
14 percent of the State's deposits and 24 offices located
in 7 different areas in the State. At the present time
it also has pending a separate application to merge
with a small bank in southwest South Carolina. Citizens has two offices located in Darlington, S.C, about
10 miles northwest of Citizens & Southern's nearest two
offices in Florence, S.C. Its total deposits are
$5,124,000, about 0.4 percent of the total deposits of
all banks in the State. There is some direct competition between the merging banks due to the proximity
of their respective offices in the Darlington-Florence
area.
South Carolina's banking resources are highly concentrated in the four large statewide institutions, which
together control 54 percent of the State's total deposits,
partly as a result of prior mergers. These 4 banks have
acquired 24 smaller banks in the past decade and at
the same time have been opening numerous de novo
branch offices. Such acquisitions by one of the four
dominant banks have often led directly to a similar
acquisition by one of the others, with the result that
the only independent banks in a number of South Carolina communities have been eliminated from competi-

THE BANK OF ROWLAND, ROWLAND, M.C., AND SOUTHERN NATIONAL BANK OF NORTH CAROLINA, LUMBERTON,

N.C.
Banking offices
Name of bank and type of transaction

Total assets

The Bank of Rowland, Rowland, N.C, with
and Southern National Bank of North Carolina, Lumberton, N.C. (10610),
which had
merged May 23, 1964, under charter and title of the latter bank (10610).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On March 17, 1964, the $32.1 million Southern
National Bank of North Carolina, Lumberton, N.C,
and the $3.8 million Bank of Rowland, Rowland, N.C,
applied to the Comptroller of the Currency for permission to merge under the charter and title of the
former.
The applicant banks are located in Robeson County
in south central North Carolina. Rowland, site of the




In
operation

To be
operated

$3, 858, 503

1

32, 695, 056

14

35, 908, 303

15

only office of the Bank of Rowland, has a population
of 1,500 and is 3 miles north of the South Carolina
border. Lumberton, county seat of Robeson County
and site of the main office of the charter bank, has
a population of 15,300 and is 16 miles northeast of
Rowland. Southern National operates 13 offices in
6 south central counties of North Carolina. No
Southern National branch is closer to the Bank of
Rowland than the Fairmont branch, which is 13 miles
east of Rowland.
103

The area served by the applicant banks derives its
primary economic support from agriculture, principally tobacco and cotton crops, and from an expanding
textile industry. The area has definite prospects for
development, as several of the Nation's largest textile
manufacturers have been expanding in an area slightly
north of Lumberton and Rowland. Fort Bragg, the
largest military installation in the county in land area,
is within Southern National's service area.
Southern National Bank has grown 250 percent over
the past 5 years which is indicative of dynamic and
aggressive management. As a result of this merger,
the increased size of Southern National Bank will allow
it to compete even more effectively over a wider area
with the $381 million First Union National Bank of
North Carolina and the $43 million Waccamaw Bank
& Trust Co., both with area offices in Lumberton, N.G.
The presence of a third banking unit of substantial
size in the area, especially one which has exhibited
great internal growth in the recent past, will provide
this expanding community with another choice which
will stimulate competition.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest

and the application is, therefore, approved.
MAY 18, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Southern National Bank of Lumberton, N.G., proposes to acquire by merger Bank of Rowland, Rowland,
N.G.
Southern National was organized in 1897 and has
never been involved in a merger. It operates eight
offices and has total resources of $32 million. Bank
of Rowland was organized in 1903 and has never
been involved in a merger. It has one office and is
the only bank in Rowland and it has total resources
of $3,800,000.
While the proposed merger of these two banks does
not appear to have a significant effect on competition,
the continuing trend toward concentration in commercial banking in North Carolina, which has seen
the three largest banks in the State account for 85
percent of the resources acquired by merger in a 3year period, is a matter of serious concern and may
lead to the substantial lessening of competition and
tendency toward monopoly condemned by the CellerKefauver Act.

SALMON FALLS BANK, ROLLINSFORD, N.H., AND THE FIRST NATIONAL BANK OF SOMERSWORTH, SOMERSWORTH,

N.H.
Banking offices
Name of bank and type of transaction

Total assets

Salmon Falls Bank, Rollinsford, N.H., with
and the First National Bank of Somersworth, Somersworth, N.H. (1180), which
had
merged May 29,1964, under the charter of the latter bank (1180) and under
the title "First Somersworth-Rollinsford National Bank." The merged bank
at the date of merger had
COMPTROLLER'S DECISION

On March 9, 1964, the $700,000 Salmon Falls
Bank, Rollinsford, N.H., and the $1.4 million First
National Bank of Somersworth, Somersworth, N.H.,
applied to the Comptroller of the Currency to merge
under the charter of the latter and with the title "The
First Somersworth-Rollinsford National Bank."
The applicant banks are located in Rollinsford, population 1,935, and Somersworth, population 8,529.
The two towns are 4 miles apart and are situated in
the southeastern area of the State. Somersworth is
104




In
operation

To be
operated

$719, 560

1

1 331 195

1

2, 050, 756

2

an industrial town where a division of the General
Electric Co. provides employment for 1,500 people.
Rollinsford, also an industrial town, has 2 shoe factories that employ 550 people.
The merging and charter banks, along with five
others banks led by the $6.5 million First National
Bank of Rochester and the $3.8 million Strafford National Bank of Dover, serve the same area. Of these
seven banks, the applicants are the smallest.
The resulting bank will be able to procure a banking
house with an adequate vault and sufficient space for
improved customer service and bank operations, all of

which are now lacking in the present quarters of both
applicants.
Applying the statutory criteria to the proposed
merger, we conclude: that it is in the public interest
and it is therefore approved.
MAY 11, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Salmon Falls Bank, with $497,000 in deposits
and $294,000 in loans, has 1.8 and 2 percent, respectively, of the total deposits and loans of all seven commercial banks which compete in its service area. The

First National Bank of Somersworth, with $1,023,000
in deposits and $729,000 in loans, has 3.8 and 5 percent
of the total deposits and loans. Each of the merging
banks is smaller than the other five banks and the resulting bank, with 5.6 percent of deposits and 7 percent
of loans, would be the smallest commercial bank in
the service area.
The merger's elimination of the Salmon Falls Bank
as an independent bank does not appear significant in
the context of the available banking resources in the
relevant market. We conclude, therefore, that the
proposed merger will have no substantial adverse effects upon competition.

MICHIGAN NATIONAL BANK, LANSING, MICH., AND CITIZENS INDUSTRIAL BANK, GRAND RAPIDS, MICH.
Banking offices
Name of bank and type of transaction

Total assets

Citizens Industrial Bank, Grand Rapids, Mich., with
was purchased June 15, 1964, by the Michigan National Bank, Lansing,
Mich. (14032), which had
„
After the purchase was effected, the receiving bank had

COMPTROLLER S DECISION

On April 1, 1964, the $737 million Michigan National Bank, Lansing, Mich., applied to the Comptroller of the Currency for permission to purchase the
assets and assume the liabilities of the $2.4 million
Citizens Industrial Bank, Grand Rapids, Mich.
The purchasing bank, with headquarters in Lansing,
has a total of 18 offices in the State, including 1 in
Grand Rapids. Grand Rapids, a city of 202,000, was
formerly known as the furniture capital of the world.
While the importance of that industry has declined in
recent years, diversified manufacturing, especially the
fabrication of automobile parts, has assumed greater
importance.
Banking competition in Grand Rapids is active. In
addition to the charter bank, which is located 65 miles
from Grand Rapids and is thus prohibited from establishing another branch in Grand Rapids by Michigan
law limiting establishment of new branches to a 25-mile
radius of the home office, there are four other banks:
the $323 million Old Kent Bank & Trust Co., with 29
branches; the $118 million Union Bank & Trust Co.,
with 19 branches; the $22.6 million Central Bank with
6 branches; and the $2.4 million selling bank. The
selling bank operates no branches and, following con-




In
operation

To be
operated

$2,193,000

1

737, 442, 000
739,131,079

19
19

summation of this transaction, its existing office will be
closed.
The selling bank has made no progress in the last
decade and the avowed purpose of this sale is to permit it to terminate its operations with minimum inconvenience to its depositors and borrowers. Since the
bank holds only one-quarter of 1 percent of the deposits in Grand Rapids and more than 50 banking offices
will still serve the city after the transaction, this sale
will have no adverse effect on competition. The transaction is therefore approved.
JUNE 1, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Excluding Detroit banks, Michigan National is the
largest bank in Michigan (reported total assets of
$737,442,000 as of December 20, 1963). It is twice as
large as its nearest rival in Grand Rapids, Old Kent
Bank & Trust Co. Its growth from a one-city operation to a statewide institution is marked in large part
by acquisitions of other banks, no less than 9 in a span
of 18 years.
The application, sparse in economic information,
furnishes no statistics from which to judge Michigan
National's exact position competitionwise in the Grand
105

Rapids service area. On the basis of size alone, however, it is dominant.
The acquisition must be examined against the backdrop of Michigan National's growth through acquisition of other banks and the workings of its employees
trust fund. Michigan National's full status as a bank-

ing power, then, is not immediately discernible. A
definite trend toward monopolization is indicated, and
in the circumstances any acquisition, even the most
innocuous, becomes suspect.
The proposed acquisition is viewed as having probable adverse competitive effects.

THE NATIONAL BANK OF COMMERCE OF SEATTLE, SEATTLE, WASH., ,\ND THE BANK <DF ENDICOTT, ENDICOTT,
WASH.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Bank of Endicott, Endicott, Wash., with
was purchased June 19, 1964, by the National Bank of Commerce of Seattle,
Seattle, Wash. (4375), which had
After the purchase was effected, the receiving bank had

COMPTROLLER'S DECISION

On March 6, 1964, the $707.7 million National
Bank of Commerce of Seattle, Seattle, Wash., applied
to the Comptroller of the Currency for permission to
purchase the assets and assume the liabilities of the
$2.4 million Bank of Endicott, Endicott, Wash.
Seattle, with a population of 563,000, is the largest
city in the Pacific Northwest and a trade center for an
economy dependent on lumbering, manufacturing,
fishing, and shipping. The largest single employer is
the Boeing Co. and the local economy largely fluctuates
with the fortunes of Boeing.
Endicott, located at the eastern end of the State 65
miles south of Spokane and 250 miles east of Seattle,
has a population of 392. The local economy is heavily
dependent on agriculture, predominantly wheat and
barley production. The population and the local economy have not experienced any growth in recent years.
The purchasing bank, with 74 branches and 19 percent of commercial deposits in Washington, is the second largest bank in the State. There are 3 other statewide banks competing with the purchasing bank, the
largest of which is the $1,242 million Seattle-First
National Bank with 101 branches and 35 percent of
statewide deposits. The third largest bank in the
State is the $273.7 million Peoples National Bank with
33 branches and 7.8 percent of deposits.
The selling bank has no branches and its share of
statewide deposits is less than one-tenth of 1 percent.
In the past few years, the selling bank has lost business
due to inflexible and unpopular management decisions.
106




To be
operated

$2, 049, 435

1

707, 866, 000
709, 885, 000

75
76

Moreover, the president and principal stockholder is
77 years of age and wishes to retire. Adequate successor management is not available from within or
through recruitment.
Consummation of the proposed purchase and assumption will not alter the relative competitive positions of the major banking institutions. On the contrary, it will give the applicant bank a branch in the
eastern part of the State and will stimulate competition
with the Colfax branches of the Seattle-First National
Bank and the $175.7 million Old National Bank, which
now serve the area.
By introducing modern banking serivces into Endicott, some improvement in the local economy may be
expected. Moreover, the availability of experienced
personnel from the purchasing bank will eliminate the
selling bank's management succession problem.
Applying the statutory criteria to the proposed purchase and assumption, we conclude that it is in the public interest, and, therefore, the application is approved.
JUNE 9,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

In this application, the second largest commercial
bank in the State of Washington, much of whose recent
growth has been achieved by the acquisition of other
banks, seeks to acquire a small independent bank.
The acquisition would continue a merger trend in
which the State's largest banks have been principal
participants. It would add to the already high concentration of the State's banking resources in the hands

of a few dominant banks. Finally, this acquisition
would upset the relative competitive equality which
now prevails among the Selling Bank and the two independent banks which offer a degree of competition to
such bank.

It is our opinion that this proposed acquisition,
standing alone, would not have a significant adverse
effect upon competition but is part of a trend toward
greater and greater concentration of banking in the
State of Washington.

THE BANK OF CALIFORNIA NATIONAL ASSOCIATION, SAN FRANCISCO, CALIF., AND THE AMERICAN NATIONAL
BANK OF SAN BERNARDINO, SAN BERNARDINO, CALIF.
Banking offices
Total assets

Name of bank and type of transaction

The American National Bank of San Bernardino, San Bernardino, Calif. (10031),
with
and the Bank of California, National Association, San Francisco, Calif.
(9655), which had
merged June 26, 1964, under charter and title of the latter bank (9655).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On March 4, 1964, the $1,007 million Bank of California National Association, San Francisco, Calif., and
the $62.8 million American National Bank of San Bernardino, San Bernardino, Calif., applied to the Comptroller of the Currency for permission to merge under
the charter and with the title of the former.
San Francisco is considered to be the financial capital of the western United States. In addition to being the home office of the charter bank, the city contains the headquarters of three other large statewide
banks, as well as other local and foreign banks. The
importance of the San Francisco area as a major port,
an industrial complex, a commercial center, and a
cultural and educational base is attested by the rapidity
of its population growth—1960 population increased
24.2 percent over 1950 to 2.7 million inhabitants—and the increase in its financial resources. With the
assets of several San Francisco banks being in the billions of dollars, the addition of the merging bank's
assets to those of the charter bank will clearly have a
negligible effect on the banking structure in the San
Francisco and northern California area.
The Bank of California, founded in San Francisco
in 1864, is the 6th largest bank in California and the
38th largest in the United States. It is a full service
domestic bank and has an active international finance
business. Through several mergers and internal
growth, the bank has had a remarkable 100-percent
increase in deposits from 1954 to 1963, from $441 million to $886 million. It is a geographically broad-




To be
operated

In
operation

$64, 555, 815

8

1,009,630,696

43

1,074,572,714

51

based bank, with 34 offices in California, 2 offices in
Washington, and 1 office in Oregon. Despite its multistate composition, the bank had limited its activities
in California to the north-central part of the State until
August 1963, at which time an office was established
in the central business district of Los Angeles. The
Los Angeles branch, while comparatively new, has met
with general public approval.
The principal impact of the merger will be felt in
San Bernardino, the head office of the merging bank
and the governmental and economic center of San
Bernardino County. Adjoining Los Angeles County
at its western boundary and extending to the Nevada
State line on the east, San Bernardino County covers
20,131 square miles and is the largest county in the
world in area. It has a warm, semiarid climate and
a greatly varied topography which ranges from the
lofty San Bernardino mountains to vast stretches of
the arid Mojave desert. As would be expected in
this large and variegated county, the economy is highly
diverse with agriculture, missile development, military
installations, mineral deposits, steel production, and
recreation providing the main support.
The population and economic activity in the county
are concentrated in the city of San Bernardino and its
environs, where the merging bank operates. Located
in the southwestern section of San Bernardino County,
the city had an estimated 1963 population of 96,400,
a considerable increase in the 3-year period since the
1960 population of 92,000; projections are for similar
growth in the foreseeable future. The population in
the bank's service area, which includes the city and
107

certain satellite towns, jumped 63 percent from 164,350 in 1950 to 258,348 in 1960. Personal income,
employment, assessed value of all property and other
indicators of the area's economy show dramatic gains
over the past 10 years, with forecasts of equally expansionary movement during the 1960's.
The American National Bank was founded in 1916
and maintained only one office in San Bernardino for
several decades. In 1943 a facility was opened at
Norton Air Force Base on the outskirts of the city and
since that time, six more branches have been opened
in the greater San Bernardino area. An office in
nearby Redlands has been approved and is expected
to be in operation late in 1964. Deposits of the bank
have risen 80 percent in the most recent 10-year period
to $57.6 million on December 31, 1963, and loans have
increased 230 percent to $40.4 million in the same
period.
The capable and vigorous management of the charter bank can supply the direction which the San
Bernardino bank will need so badly in the coming
years of expansion in the San Bernardino area.
This diverse and dynamic section of southern California will indeed require strong institutions to meet
the convenience and needs of its economic expansion.
Agriculture on a large scale, major commercial establishments and big manufacturing concerns are a few
of the industries included within the San Bernardino
banking community; their needs can only be met by an
institution stronger than the local bank. Branches of
major California banks have come into San Bernardino to serve the area's needs, making it more necessary than ever for the merging bank to become part
of a major system in order to handle its share of the
commercial business. Its legal loan limit of $210,000
does not permit the bank to serve effectively some of
the major industries in San Bernardino.
The present size of the merger bank severely restricts loan volume. One of the principal financial
requirements in San Bernardino is capital for real
estate loans stemming from the influx of people into
this southern California region. The merging bank
has not been able to meet the demands for these loans
even though its loan portfolio is at a high 70 percent
of deposits. With real estate loans increasing from
$2.7 million in 1954 to $36.2 million in 1963, the
bank has had to sell $35 million originating in its
service area to other investors because of its own
financial limitations. The need for a larger capital
and deposit structure is evident.
The facilities of a major bank will broaden the
services which the merging bank can offer in the
108




San Bernardino area. The resulting bank, for example, can offer international and stock transfer departments which the merging bank does not now
have, but which the area needs. On the other hand,
the merging bank has particularly strong escrow and
mortgage servicing departments which the charter
bank can use to complement its other operations.
While the advantages of the merger to the San
Bernardino community are very substantial, the competitive aspects must be examined. The merging
bank is the only locally owned bank in San Bernardino.
It is closely held, predominantly by San Bernardino
residents. The merits of having a bank controlled by
local residents is persuasive only when the bank can
serve the community effectively. In the instant case,
the bank now finds it difficult to recruit an effective
management group and impossible to provide the
capital and financial services which the San Bernardino area calls on it to supply. The purely local
character of the merging bank has little value in this
situation.
The resulting bank will be more competitive in the
San Bernardino area than the present merging bank,
while no competition will be eliminated. The service
areas of the applicant banks do not overlap, as the
nearest branch of the charter bank is 60 miles away in
Los Angeles and has only been open less than 1 year.
A comparison of commercial deposits in the two banks
reveals only five common customers, and these are
all large regional or national firms which keep funds
in the locality where they do business. No accounts
of either bank originate in the service area of the
other.
In the State, the charter bank now has only 2.2
percent of total commercial banking deposits and its
share, as a result of the merger, will increase to 2.4
percent, hardly a share of the California market which
could be called concentrative.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
JUNE 15,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

American National is a successful local bank with
assets of $62,807,000, deposits of $57,647,000, loans of
$39,590,000, and 213 trust accounts. Its eight offices
are located in five communities in the southwestern
portion of San Bernardino County about 60 miles east
of Los Angeles Calif. All other bank offices in these
communities are branches of large regional or statewide
chain banking systems.

Bank of California Is the sixth largest commercial
bank In California and 38th in the Nation, with assets
of $1,006,951,000, deposits of $886,003,000, loans of
$522,415,000, and 4,910 trust accounts. It has 34
banking offices in California and 1 each in Portland,
Oreg., and in Seattle and Tacoma, Wash. Its only
office in southern California is a large new headquarters office which it established in downtown Los
Angeles in August 1963.
There appears to be little direct competition between
American National and Bank of California because the
latter's closest office is 60 miles from the communities
served by American National. The merger would,

however, eliminate potential competition between the
applicants. Absent the merger, Bank of California
could be expected to expand from its headquarters
office in Los Angeles by establishing de novo branches
in the growing San Bernardino area, which is the next
metropolitan area east of Los Angeles. The merger
would also have the undesirable effect of eliminating
the only local and independent bank in the area and
making San Bernardino completely dependent on
branches of banks whose headquarters and major interest are elsewhere, (in San Francisco or Los Angeles).
We conclude that the proposed merger would have
an adverse effect upon competition.

FIRST NATIONAL BANK IN CALLICOON, CALLICOON, N.Y., AND THE FIRST NATIONAL BANK OF NARROWSBURG,
NARROWSBURG, N.Y.
Banking offices
Name of bank and type of transaction

Total assets

The First National Bank of Narrowsburg, Narrowsburg, N.Y. (12496), with
and the First National Bank in Callicoon, Callicoon, N.Y. (13590), which had.
consolidated June 30, 1964, under charter of the latter bank (13590), and
under title of "United National Bank." The consolidated bank at the date
of consolidation had
,

COMPTROLLER S DECISION

On March 13, 1964, the $5.9 million First National
Bank in Callicoon, Callicoon, N.Y., and the $4.1 million First National Bank of Narrowsburg, Narrowsburg, N.Y., applied to the Comptroller of the Currency
to consolidate under the charter of the former and with
the title "United National Bank."
Callicoon, population 850, and Narrowsburg, population 600, are unincorporated municipalities situated
14 miles apart in the western part of Sullivan County,
N.Y. Both are located close to the Delaware River
which forms the New York-Pennsylvania boundary.
The two villages are connected by State Highway 97
and the Erie-Lackawanna Railroad.
The general service area within which the two banks
are located is largely coterminous with Sullivan
County. However, it also includes part of adjacent
Wayne County, Pa. This area is predominantly rural
and agricultural with dairy products and eggs as the
principal products. The resort business is also important as hotels, motels, and camps proliferate




$4, 322, 809
6, 122,103
10,444,912

To be
operated

In
operation
1
1

2

throughout the Catskill Mountain area which includes
Sullivan County.
There are 15 commercial banks serving this general
trade area. The competitive structure is dominated
by the two large banks in Liberty: the $26 million Sullivan County National Bank and the $23 million Community National Bank which has applied for permission to merge with the Marine Midland National Bank
of Southeastern New York of Poughkeepsie. The two
banks have 41 percent of the outstanding loan and 33
percent of the deposits held by banks in this area.
Among these 15 banks, the Narrowsburg bank is the
smallest. Even the resulting bank will have only 6.7
percent of the total loans and 7 percent of the deposits
among the area banks.
There has been little competition between the applicant banks. Each has primarily served the village
within which it is located and the rural area adjacent to
it. Both banks do draw some business from that small
area which is approximately equidistant from each.
This consolidation will not disrupt the area's competitive structure.

109

The consolidation will create a bank which is far
more responsive to the needs of the trade area it
serves than is possible for the two applicants at present. Neither of the applicants is adequately capitalized to meet the credit requirements of its customers.
Likewise, they are not large enough to provide the
range of banking services demanded of them and
which are regarded as commonplace in contemporary
banking. This would include an active trust department, mortgage financing on standard terms, home improvement loans, as well as immediately available foreign drafts. Furthermore, a larger institution will be
better able to attract and train the management personnel needed to successfully operate a bank. This
need is particularly acute here since all of the Narrowsburg Bank executive officers have reached retirement age, while not a single qualified successor is available to replace any of them.
Considered in the light of the relevant statutory
criteria, we find the application to be in the public
interest, and it is therefore approved.
JUNE 22,

1964.

SUMMARY OF REPORT BY ATTORNEY

GENERAL

The proposed consolidation would unite two banks
located about 14 miles apart in the southern part of
New York State. There are a number of banks in the
surrounding areas but none impinges competitively on
either of the applicant banks. The two applicant
banks, however, have a significant degree of overlap
in their service areas, and a number of common depositors and borrowers. Also each bank has a number of
deposits and loans which originate in the service area
of the other. The proposed consolidation would erase
this banking competition. The applicants admit that
there is a "growing tendency in nearby areas . . . toward the merger or consolidation of a number of banking institutions" with the result that it is becoming
"more and more difficult for the smaller bank to compete effectively." This proposed consolidation would
be another step in this anticompetitive trend to concentration. We therefore believe that this transaction
would have an adverse competitive effect.

T H E FIRST NATIONAL BANK OF ALLENTOWN, ALLENTOWN, P A . , AND MACUNGIE BANK, MACUNGIE, P A .
Banking offices
Total assets

Name of bank and type of transaction

In
operation

The Macungie Bank, Macungie, Pa., with
and the First National Bank of Allentown, Allentown, Pa. (373), which had. .
merged June 30, 1964, under charter and title of the latter bank (373). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On April 16, 1964, the $152 million First National
Bank of Allentown, Allentown, Pa., and the $4.6 million Macungie Bank, Macungie, Pa., applied to the
Comptroller of the Currency to merge under the charter and with the title of the former.
The applicant banks are located in Lehigh County,
which is part of the Allentown-Bethlehem-Easton
Standard Metropolitan Statistical Area. Allentown,
population 108,347, and Bethlehem, population 75,408,
are adjacent to, and contiguous with, each other and
are considered to be a single economic entity. Allentown has several large plants which manufacture
trucks, electrical equipment, and cement, while Bethlehem is the home of the Bethlehem Steel Co. The
borough of Macungie, population 1,266, is largely a
110




$4, 559, 586
155,725,088
160,284,674

To be
operated
1
6
7

residential suburb adjacent to Allentown and also
serves as a shopping center for its inhabitants.
Nine commercial banks operating a total of 35 offices serve the Allentown-Bethlehem area. In addition
to the charter bank with its 7 offices and the single-unit
merging bank, there are the $104 million Merchants
National Bank of Allentown, with 10 offices; the $59
million Lehigh Valley Trust Co. of Allentown, with 5
offices; the $94 million First National Bank & Trust
Co. of Bethlehem, with 7 offices; and the $77 million
Union Bank & Trust Co., Bethlehem, with 5 offices.
Also serving this general area are the $23 million
Cement National Bank of Northampton, the $12 million Fogelsville National Bank, and the $9.6 million
National Bank of Topton,
Eight savings and loan associations and building
and loan associations provide intense competition to

commercial banks in the Allentown area. These associations hold share account balances in excess of $155
million and loans of $151 million. Insurance companies, credit unions, and financial institutions in
nearby Philadelphia and New York City are other important sources of competition to the commercial
banks.
There has been little, if any, competition between
the charter and merging banks. The Macungie Bank
serves almost exclusively the residents of the community in which it is situated. The bank is located in a
row-type house which is totally inadequate for a modern banking business., as it has no safe deposit boxes, no
drive-in window and no parking area. Seventy-one
percent of its portfolio is in residential real estate loans.
With this limited operation, it is evident that effective
competition is not offered to the charter bank by the
merging bank.
This merger will cause no significant change in the
banking structure of the area nor will it adversely affect any other bank. Substitution of an office of the
charter bank for the merging bank in Macungie will
not place the charter bank nearer to any other competing bank than it is at the present time. It will increase the charter bank's share of deposits in the area
by only 1 percent.
The borough of Macungie will be greatly benefited
by the consummation of this transaction. The resulting bank will build a modern banking house equipped
with safe deposit facilities, greatly increased floor and

office space, a drive-in window, and parking facilities
in the immediate vicinity of the present bank office.
Furthermore, the resulting bank will offer a full range
of modern banking services, including a trust department, more responsive to the needs of the area. In
addition, the merging bank's acute management succession problem caused by the loss of its only full-time
executive officer will be provided for by the appointment of a capable bank officer to manage the Macungie branch.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is therefore approved.
JUNE 26, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger involves the uniting of a neighboring, small town bank with the largest bank in
Allentown, Pa. First National Bank of Allentown already enjoys about 50 percent of the market of banks
headquartered in Allentown. Two of its branch offices are among the four closest banking offices to
Macungie Bank which is located 8 miles southwest of
Allentown, and which is the only bank in Macungie.
Both First National Bank and Macungie Bank have
shown good growth trends in recent years. The proposed merger would result in adding to the already
dominant position of First National Bank in Allentown
and the area surrounding Allentown with probable adverse competitive effects.

THE PEOPLES NATIONAL BANK OF WEST ALEXANDER, WEST ALEXANDER, PA., AND THE FIRST NATIONAL BANK
OF FREDERICKTOWN, FREDERICKTOWN, PA.
Banking offices
Name of bank and type of transaction

Total assets

To be
operated

In
operation
The Peoples National Bank of West Alexander, West Alexander, Pa. (8954),
with....
and the First National Bank of Fredericktown, Fredericktown, Pa. (5920),
which had
merged June 30, 1964, under the charter and title of the latter bank (5920).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On April 1, 1964, the $1.8 million Peoples National
Bank of West Alexander, West Alexander, Pa., and
the $12.9 million First National Bank of Fredericktown, Fredericktown, Pa., applied to the Comptroller
of the Currency for permission to merge under the




$1, 842, 728

1

13,724,384

4

15,567,112

5

charter and title of the latter.
Fredericktown, a mining village with a population
of 1,270, is situated on the upper Monongahela River
in southwestern Pennsylvania. It serves a trade area
economically dependent upon coal mining, which employs 2,500 workers out of an estimated 10,000 persons
in the area.
Ill

West Alexander, a farming community located approximately 27 miles west of Fredericktown on the
West Virginia-Pennsylvania border, in the heart of Appalachia, has a population of 750 and serves a rural
trade area of 1,500. The area's economy, which has
shown only minimal improvement in the past 15 years,
is based primarily on agriculture and on employment
of residents in industries situated in Wheeling, W. Va.,
and Washington, Pa.
There are no competing banks in either of the applicants' communities and competition from nonbank
financial institutions is minimal. Because of the distance between the applicant banks, they do not compete with each other. Both banks are under unified
control, with four common directors owning more than
two-thirds of the shares of each bank. The net effect
of the proposed merger, due to the increase in the total
resources of the resulting bank, will be more effective
competition for those larger banks on the fringes of
the applicants' trade areas.
The proposed merger will substantially benefit the
convenience and needs of the West Alexander com*

munity. The merger will also provide a financial
framework more suited to attracting industry to a community which, at present has an unfavorable economic
outlook.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest
and the application is therefore approved.
JUNE 23,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

This application is a proposal to merge two banks,
both of relatively small size, in southwestern Pennsylvania. The merging banks do not appear to offer each
other any appreciable competition because they are
located about 35 miles apart. Each bank faces competition from several other banks, many of which are
far larger institutions. This merger will not materially
alter the prevailing banking structure in the areas in
which each of the merging banks now competes.
For these reasons, it is our opinion that the proposed
merger will not have a substantial adverse effect on
competition.
* *

OLD NATIONAL BANK OF WASHINGTON, SPOKANE, WASH., AND TRI-CITIES NATIONAL BANK, PASCO, WASH.
Banking offices
Total assets

Name of bank and type of transaction

In
operation
Tri-Cities National Bank, Pasco, Wash. (14919), with
was purchased June 30, 1964, by Old National Bank of Washington, Spokane,
Wash. (4668), which had!
After the purchase was effected, the receiving bank had

COMPTROLLER S DECISION

On April 20, 1964, the $203.3 million Old National
Bank of Washington, Spokane, Wash., applied to the
Comptroller of the Currency for permission to purchase the assets and assume the liabilities of the $4.3
million Tri-Cities National Bank, Pasco, Wash., under
the charter and with the title of the former.
Spokane, with a population of over 181,000, is the
second largest city in the state and the trading center
of a tristate area known as the "Island Empire." The
region, although semiarid, has a large agricultural production. Lumbering and mining contribute to the region's economy, and in recent years, there has been
a steady increase in manufacturing.
Pasco, located about 146 miles southwest of Spokane, has a population of about 15,000 and serves as
112




To be
operated

$4,321,160

2

203,317,906
207, 639, 065

30
32

the distribution center for farm products grown in the
southeastern part of the State. The Lower Columbia
Basin Irrigation projects permit diversification in alfalfa, sugar beets, potatoes, corn, and other row crops.
Old National Bank of Washington, operating 29
branches in eastern Wasliington, ranks sixth among
commercial banks and holds 5.5 percent of commercial
bank deposits in the State. It is the only one of the
larger statewide banking systems with home offices in
the eastern part of the State. Competition is furnished by branches of the $1,213 million Seattle-First
National Bank, the $686 million National Bank of
Commerce, the $278 million Peoples National Bank
of Seattle, and the $222 million National Bank of
Washington.
Tri-Cities National Bank, a satellite of the purchasing bank, opened in 1961 to provide the purchasing

bank with access to the Pasco area. It is heavily
loaned and pursues an aggressive policy in soliciting
credits, the excess of which are sold to the purchasing
bank. Banking competition in Pasco is offered by
branches of Seattle-First National Bank and Peoples
National Bank of Seattle. Additional competition in
nearby communities is provided by branches of the National Bank of Commerce of Seattle in Kennewick, 2
miles south, as well as by the newly chartered Bank of
Richland and branches of the Seattle-First National
Bank and the National Bank of Commerce in Richland, 7 miles southwest.
Due to the interlocking relationship between the
purchasing and selling banks, consummation of the
purchase and assumption would not have the effect
of eliminating significant competition. The residents
of Pasco, however, would have another branch of a
full service bank. The greater availability of credit,
of trust services, and of the purchasing bank's agricultural agent will benefit the community. Unity of operations will result in lower operating costs and more
efficient service to the public.

Applying the statutory criteria to the proposed purchase and assumption, we conclude that it is in the
public interest and the application is, therefore,
approved.
JUNE 4, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

In this application, the fifth largest commercial bank
in the State of Washington seeks to purchase a small
independent bank. The size of the Purchasing Bank
will not be increased materially by this acquisition, nor
will any significant competition between the Selling
Bank and the Purchasing Bank be eliminated. The
position of the Selling Bank's competitors should not
be adversely affected to a substantial degree, because
they are branches of large statewide banks.
It is our opinion that this proposed acquisition,
standing alone, would not have a significant adverse
effect upon competition but is part of a trend toward
greater concentration of the banking resources of the
State of Washington in the hands of a few large institutions with resulting probable anticompetitive effects.

THE FIRST NATIONAL BANK OF HAGERMAN, HAGERMAN, N. MEX., AND THE FIRST NATIONAL BANK OF ROSWELL,
ROSWELL, N. MEX.
Banking offices
Name of bank and type of transaction

Total assets

The First National Bank of Hagerman, Hagerman, N. Mex. (7503), with
was purchased July 17, 1964, by the First National Bank of Roswell, Roswell,
N. Mex. (5220), which had
After the purchase was effected, the receiving bank had

On May 5, 1964, the $38 million First National
Bank of Roswell, Roswell, N. Mex., applied to the
Comptroller of the Currency for permission to purchase
the assets and assume the liabilities of the $2.8 million
First National Bank of Hagerman, Hagerman, N. Mex.
Roswell, home of the purchasing bank, has a population of 47,500, and serves the southeastern part of
New Mexico. Within a radius of 100 miles, there are
approximately 300,000 persons. Although Roswell is
rapidly becoming a commercial, industrial, and financial center for this area, the surrounding country is
still devoted mainly to large-scale ranching and
agriculture.
The selling bank is located in Hagerman, a community of 1,200 situated 23 miles south of Roswell.
Both Hagerman and the area surrounding it are almost entirely agriculturally oriented. The local busi-




In
operation

To be
operated

$2, 875, 601

1

38, 039, 674
40, 352, 775

1

2

nesses are either connected directly with agriculture or
service the farmers. The selling bank has its sole
branch in Dexter, an agricultural community 6 miles
north of Hagerman.
Consummation of the proposed transaction will increase the resulting bank's size only minimally and
will have little, if any, adverse effect on the structure
of banking in the area. The two banks are not truly
competitive, since all but a nominal amount of the
capital stock of the selling bank has been held by
trustees for the benefit of the purchasing bank's board
of directors since 1941.
Approval of the proposed acquisition will permit
the resulting bank to better serve the convenience and
needs of the Hagerman area. Although the purchasing bank has controlled the policies and operations of
the selling bank for more than two decades, the latter's
113

small deposit base has limited its ability to provide
many of the types of loans that are presently provided
by the purchasing bank and demanded by the community. Among these are intermediate-term farm
equipment loans, real estate loans, and home improvement loans. Furthermore, the larger resources of the
purchasing bank will permit the offering of other
services, including a trust department. Consummation of the proposal will eliminate the operational
handicap of limited personnel that is preventing effective management of the selling bank. Presently an
officer of the purchasing bank is managing one office
of the selling bank, but only the consummation of this
transaction can provide a permanent solution.
Applying the statutory criteria to the proposed purchase of assets and assumption of liabilities, we conclude that it is in the public interest and the application is therefore approved.
JULY 14, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The First National Bank of Roswell (population
47,500) was chartered in 1890. It serves Chaves
County (population 60,000) and is the largest bank in
the southeastern part of New Mexico. It has a principal office and three branches, all in Roswell. The
first branch was established in November 1956, the
second in 1960 and the third in 1963.
The First National Bank of Hagerman (population
1,200), about 25 miles south of Roswell, was chartered
in 1904. It has a principal office and one branch, established in 1955, in Dexter, N. Mex., 6 miles north of
Hagerman.
There are four banks in Chaves County, the primary
service area of the purchasing bank, the First National
Bank of Roswell.
The proposed acquisition will permanently eliminate
the competition of the selling bank in the Chaves

County area and give the purchasing bank 60.50 percent of the total deposits and 60.28 percent of the loans
and discounts in that area. Effective competition has
already been eliminated through joint control of the
two banks.
By virtue of the acquisition, the purchasing bank
will enter directly into the area including Eddy County
in which there are two more banks at Artesia, 43 miles
south of Roswell, and besides eliminating for all time
the competition of the selling bank, will have 45.98
percent of the total deposits and 47.56 percent of the
loans and discounts in that area.
In a growing area with so few banks, the permanent
elimination of a competitor by the largest bank seriously affects the competitive situation therein adversely.
As hereinabove noted, in Roswell and Chaves County,
the area of business concentration and the primary
service area of the banks involved, in addition to the
elimination of the selling bank, the purchasing bank
will have 60.50 percent of the deposits and 60.28 percent of the loans and discounts. [Cf. U.S. v. First National Bank & Trust Co. of Lexington (No. 36—October Term 1963, decided April 6, 1964), in which the
Supreme Court held a merger to violate the Sherman
Act, wherein the resulting' bank, if permitted to merge,
would have had 51.95 percent of the total deposits
and 54.2 percent of total Joans of all commercial banks
in Fayette County, Ky.]
Even in the area of Chaves County plus northern
Eddy County, the percentage of concentration of business within that service area of the resulting bank is
close to that of the resulting bank in the Lexington
case.
It appears, therefore, that the proposed purchase of
assets and assumption of liabilities of the First National
Bank of Hagerman by the First National Bank of Roswell will have a substantial adverse effect on competition and further a tendency toward monopoly in the
areas involved.

THE ALLEGAN STATE BANK, ALLEGAN, MICH., AND THE FIRST NATIONAL BANK & TRUST CO. OF KALAMAZOO,
KALAMAZOO, MICH.
Banking offices
Name of bank and type of transaction

Total assets

To be
operated

In
operation
Allegan State Bank, Allegan, Mich, with
and the First National Bank & Trust Co. of Kalamazoo, Kalamazoo, Mich.
(191), which had
merged July 18, 1964, under the charter and title of the latter bank (191).
The merged bank at the date of merger had

114




$15, 420, 907

1

114, 521, 393

19

129,919,270

20

•" < ;M 1 ' T E L L E R S DECISION
;

O • ^ \ S, 1964, the $1.10 million First National
Bank nf Kalamnzoo, Kalamazoo, Mich., and the $15
million Ailc-nan State Bank, Allegan, Mich., applied to
the Comptroller of the Currency for permission to
men?;c Uiic'.er the charter and title of the former.
Thr- carter bank lias its main office and 7 of its 18
branches in Kalamazco, a rapidly expanding city which
incro:i<-d i;> population by 42.3 percent between 1950
and U'^u tc 82.000. The trade area of Kalamazoo is
supported bv widely diversified industry, agriculture
and education. The city of Kalamazoo has 3 colleges
with a total enrollment of 12,000 students. Further,
Gene;1;.! Motors Corp. is presently building a plant in
Comstcck Township, just outside Kalamazoo, which
shouk' (.':.iploy some 3,200 people.
Allegan, with a population of 5,000, is 25 miles
northwest of Kalamazoo. Serving a trade area of
about 5S.00U. Allegan is supported by small manufacture ( r concerns, surrounding farm lands and die Alle_
gan SLU".1 Forest -which attracts a large number of
tour; ts -^ach year.
The in.-i'u'irig bai:.k is Allegan's only banking office,
and ii,«» m i-.ivst banking facility is the Hopkins branch
of the S..> liullion Wayland State Bank, 8 miles north"""
'
east ol Allv^an. The Allegan State Bank is the largest
of a f-'-ies (;f small banks to the northwest of Kalamazoo at distances varying from 22 to 47 miles thereiron1. Tk. se banks arc all within 20 miles of the Allegan Slat-.1 Bank, the largest of the group being the $30
million First Michigan Bank of Zeeland. The $20
million Citizens Trust & Savings Bank of South Haven
and tlx Alvgan State Bank are the two next largest
of this group. The size of these banks, coupled with
the facts lh.it they are relatively dispersed geographically and that their rate of growth has not been significant, points to a limited amount of competition among
them.
The larger resulting bank in Allegan will introduce
trust services, charge account banking, in-plant banking uncL extensive computer services, as well as more
extensive raid aggressive penetration in the areas of
farm r.icr'.gau'es. loans to small business, automobile
floor plan financing and education loans. It is hoped
that the t Vrter bank's vigorous policies will stimulate
the banking competition which is necessary.
In ;u'd'tion, the proposed merger will solve a severe
manarev.iert succrsv'on problem faced by the merging




bank. The two senior executive officers have been
active bankers for over 50 years each, and quite understandably wish to retire. However, the size of the
bank has not presented an opportunity to develop
younger men to provide successors to the present management. The more extensive management position
of the charter bank will fill this need.
In Kalamazoo, First National will increase its percentage of deposits insignificantly from 22 to 24 percent
of the area's total deposits. The effect of this increase
will not be important to the other local banks, the $90
million American National Bank, Kalamazoo, or the
$40 million Industrial State Bank, Kalamazoo, as most
of the competition that will be generated by this merger
is on the extreme fringe of Kalamazoo's trade area.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
JULY 14,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

In a service area encompassed within a radius of
12 miles from the city of Allegan, Mich., and serving
a population of some 12,000, First National (total resources as of December 20, 1963, of $108,190,000) already twice as large as all the other banks in the area
together, would be acquiring the fourth largest bank
in the area, Allegan State (total resources as of December 20, 1963, of $14,318,000). This proposed merger
would aggravate an already serious concentration of
power and would make even more precarious the position of the smaller banks in the area, eliminate competition and put an absolute banking monopoly in
Allegan proper into the hands of the predominant bank
in the area.
First National, also the largest bank in southwest
Michigan (population 325,000), appears to be attempting to match a recent acquisition by its chief competitor, the American National Bank & Trust Co. of
Kalamazoo, in the larger southwest area with which
it shares 29.89 percent of the deposits and 23.14 percent
of the loans.
The proposed merger is seen as eliminating competition and giving impetus to a concentration of banking
power which has already developed to an unwarranted
degree. So viewed, the merger would be clearly anticompetitive in its probable impact.

115

THE CENTRAL NATIONAL BANK IN CHICAGO, CHICAGO, I I I . , AND THE NATIONAL BANK OF COMMERCE OF CHICAGO,
CHICAGO, I I I .
Banking offices
Name of bank and type of transaction

Total assets

National Bank of Commerce of Chicago, Chicago, 111. (14349), with
and Central National Bank in Chicago, Chicago, 111. (14362), which had. . . .
merged July 18, 1964, under the charter and title of the latter bank (14362).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On April 20, 1964, the $193.6 million Central National Bank in Chicago, Chicago, 111., and the $48.2
million National Bank of Commerce of Chicago,
Chicago, 111., applied to the Comptroller of the Currency for permission to merge under the charter and
with the title of the former.
Chicago, the second largest city in the United States,
has a population of about 3,500,000 and is the focal
point of an area whose population is 6,200,000.
Chicago not only serves as the business and financial
center of the entire Midwest, but also leads all cities
in the country in the production of steel, telephone
equipment, metal wares, and machinery. Large
transportation, agricultural processing and merchandising operations centered in this area contribute
significantly to the thriving economy.
The Central National Bank in Chicago has grown
steadily since its organization in 1936. Having relocated its main office in the heart of the Loop at the
time of its merger with Merchants National Bank in
1962, it now ranks eighth among metropolitan Chicago
banks, with deposits of $176.7 million and loans of $95
millions. Its share of total banks deposits in the area
is 1.15 percent. Located within three blocks of the
charter bank are its chief competitors: Continental
Illinois National Bank; First National Bank; Harris
Trust Co.; La Salle National Bank; and Northern
Trust Co.
The National Bank of Commerce is situated 5 miles
west of the charter bank. At the time of its organization in 1936, its service area was considered to be one
of the more prosperous districts in Chicago. In recent
years, however, the economy of the merging bank's
service area has been deteriorating with the result that
the bank's deposits have declined. At present, the
merging bank has a 0.3 percent share of the metropolitan Chicago area deposit market. Although earnings over the past few years have been maintained at a
favorable rate, the bank's directors and officers have
116




$40, 947, 905
207, 018, 960
247, 966, 865

To be
operated

In
operation
1
1

1

been increasingly pessimistic about growth prospects
because of the deterioration in the economy of the
bank's service area. Moreover, many of the bank's
officers have passed or are nearing retirement age.
Consummation of the proposal will have a negligible
effect upon the banking structure of the metropolitan
Chicago area. Upon closing of the merging bank's
office when the merger is effected, a total of 134 banks
will remain to serve the needs of the banking public
in the metropolitan Chicago area. Furthermore, the
number of banks located in the vicinity of the merging
bank's office will remain constant due to the expected
opening there of a newly chartered state bank.
The anachronistic branch banking law of Illinois,
whose prohibition of branch banking reflects the economic aridity of a past generation and the noncompetitive disposition of some of its bankers, is seen in its
true perspective in this case. Ever zealous of protecting privileged enclaves, such bankers have succeeded
in thwarting reform, thus needlessly restricting the
development of the banking structure and hampering
the progress of the economy. It is indeed anomalous
in view of the deep involvement of the public interest
in banking that the development of banks and their
capability to serve the convenience and needs of the
public, to foster the creation of new enterprises and
to sustain the growth of existing business and industry,
should be hindered by oppressive State and Federal
statutes forbidding branch banking. In the instant
case it is evident that the community would be served
better were the merging bank allowed to continue
as a branch of the charter bank.
The benefits derived from the proposed merger,
in terms of better service to the metropolitan Chicago
community, more than offset the minimal change in
the competitive banking structure. The resulting
bank will offer broader, more varied services not
previously available to the merging bank's customers
and an increased lending capacity that will enable it
to compete on a better footing with some of the sur-

rounding banks in the Loop. Additionally, the resulting bank will be in a better position to meet the banking
needs of the large number of customers of the merging
bank who have indicated an intent to do business with
the resulting bank.
Applying the statutory criteria, we find the proposed
merger to be in the public interest and therefore the
application is approved.
July 14,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Central, a Chicago "loop" bank with total assets
of $193,573,000, proposes to merge with National, a
bank with $48,257,000 in assets located 5 miles to the
west in the city of Chicago, a nonbranching jurisdiction. Since 1954, Central has consummated three
mergers, the last of which took place in 1962 and

increased its assets by about 50 percent. One reason
advanced for this, as well as for the previous merger,
is to fill a void created by the 1961 merger of City
National into Continental Illinois, Chicago's largest
bank. On that ground, the proposed merger would
appear to be premature, since a valadity of the CityContinental merger is still to be determined in pending
antitrust litigation.
Concentration in commercial banking in the Chicago area is high due to recent mergers. This merger
can only add to that concentration. As it has
encouraged Central, it will encourage other banks to
merge thereby further eliminating competition, as it
eliminates competition between Central and National,
and further increase concentration in commercial
banking in Chicago.
We believe that the effect of the proposed merger
on competition will be substantially adverse.

THE NATIONAL BANK OF DAYTON, DAYTON, OHIO, AND THE COMMUNITY BANK, DAYTON OHIO
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Community Bank, Dayton, Ohio, with
and the National Bank of Dayton, Dayton, Ohio (1788), which had
merged July 18, 1964, under the charter and title of the latter bank (1788).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On April 24, 1964, the $105.3 million National Bank
of Dayton, Dayton, Ohio, and the $4 million Community Bank, Dayton, Ohio, applied to the Comptroller of the Currency for permission to merge under the
charter and with the title of the former.
Dayton, with a population of 398,000, is located in
Montgomery County which reports a population of
579,000. The city's numerous manufacturing establishments, Wright-Patterson Air Force Base, and the
Defense Electronics Supply Center employ about
120,000 persons. General Motors Corp. alone employs about 30.000 people in its Dayton plants.
Huber Heights, an unincoporated residential suburb
of Dayton in which the merging bank is located, has a
service area population of about 12,000. Approximately 26 percent of the employed residents work at
the nearby Wright-Patterson Air Force Base. The
residential development of this area, which consists
largely of brick homes ranging in value from $13,000
to $20,000, has been steady.




$4,105, 543
101,172, 802
104, 628, 363

To be
operated

1
10
11

The charter bank, third largest commercial bank in
the Dayton metropolitan area, operates eight branches
in Dayton and two in Kettering; it also has five approved but unopened branches in Dayton. Its major
competitors are the $275 million Winters National
Bank & Trust Co. of Dayton and the $121 million
Third National Bank & Trust Company of Dayton.
Consummation of the proposed merger not only will
eliminate the merging bank's management problem but
also will place the resulting bank in a better position
competitively needed by both institutions. Further,
the facilities of a full-service institution will be available
in Huber Heights to compete with the projected branch
of the Winters National Bank. Since the participating
banks are not in competition, no elimination of competition nor trend toward monopoly is involved.
Applying the statutory criteria, we conclude that
the merger is in the public interest and the application is, therefore, approved.
JULY 14, 1964.

117

SUMMARY OF REPORT BY ATTORNEY GENERAL

The National Bank of Dayton, having assets of
$105.3 million, deposits of $93.8 million, and loans
of $56.9 million, proposes to acquire the Community
Bank with assets of $4 million, deposits of $3.7 million, and loans of $1.9 million. These banks are the
third and fourth largest of four banks servicing the
Greater Dayton area. The National Bank operates
from a main office and eight branches; five additional
branches are approved but not yet opened. All are
with the Greater Dayton area. The Community Bank

has no branches, provides limited banking services,
and 95 percent of its business is from Huber Heights,
a section of Wayne Township which is a subdivision of
Greater Dayton.
There presently exists little, if any, direct competition between the two banks.. This merger would not
affect the competitive status of the remaining banks
in Dayton. However, so concentrated are banking
services in a relatively few institutions in Greater Dayton, that elimination of even a small bank will exert
an adverse effect upon competition.

THE FAIR LAWN-RADBURN TRUST CO., FAIR LAWN, N.J., AND THE NATIONAL COMMUNITY BANK OF RUTHERFORD, RUTHERFORD, N.J.
Banking offices
Total assets

Name of bank and type of transaction

In
operation

Fair Lawn-Radburn Trust Co., Fair Lawn, N.J., which had
and National Community Bank of Rutherford, Rutherford, N.J. (5005), with.
merged July 31, 1964, under the charter and title of the latter bank (5005).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On May 28, 1964, the $140 million National Community Bank of Rutherford, Rutherford, N.J., and
the $26 million Fair Lawn-Radburn Trust Co., Fair
Lawn, N.J., applied to the Comptroller of the Currency for permission to merge under the charter and
with the title of the former.
Although the charter bank is headquartered in
Rutherford, a borough of only 22,000 people, it serves
a contiguous trade area with a population in excess
of 300,000. Bergen County, in which Rutherford is
located, can best be described as a well-diversified residential, industrial, and retail trading area which encompasses one of the most rapidly growing counties
in the United States. The county owes its phenomenal
growth, in no small part, to its close proximity to New
York City.
The National Community Bank is the second largest of 29 commercial banks in Bergen County. It operates 11 offices throughout the southern part of the
county and accounts for 9.8 and 11.5 percent of the
county's total loans and deposits, respectively.
The merging bank is located in Fair Lawn, population 39,804, and serves a trade area population in
excess of 200,000. This trade area is predominantly
residential but contains numerous industrial plants and
118




$26, 365, 293
139, 946, 077
166, 311, 369

To be
operated

4
11
15

small business enterprises. Prospects for future residential growth in the area are rather limited, while
industrial growth potential is very favorable.
The Fair Lawn-Radburn Trust Co., the 10th largest
commercial bank in Bergen County, with 1.9 percent of the total deposits and 2.1 percent of the loans,
operates four offices in the immediate Fair Lawn-Radburn area.
This merger will have no significant effect on the
banking structure of Bergen County. The merging
banks' trade areas are contiguous rather than overlapping, and accordingly, there has been little, if any,
competition between them. The resulting bank will
operate 14 offices and hold 13.6 percent of deposits
and 12.4 percent of loans in Bergen County. It will
retain its relative size as compared to the dominant
$286 million Peoples Trust Co. of Hackensack, N.J.,
which operates 16 offices in Bergen County with 22.9
percent of the deposits and 24.2 percent of the total
loans in the county.
In the Fair Lawn-Radburn area, competition will
not be lessened. To the contrary, effective competition will be increased by the introduction of another
strong, full-service bank into an area in which the
small merging bank has been mainly attempting to
compete with five Passaic County and two Bergen
County banks. The fact that earnings of the merg-

ing banks have actually declined over the past 5
years during a period of unprecedented prosperity indicates that the bank has not been an effective competitive factor in its area.
The public interest, convenience and needs of the
Fair Lawn-Radburn banking public will be better
served by the more extensive services to be offered by
the resulting bank, A larger, better staffed and more
effieciently run trust department, a foreign banking
department and an increased lending limit to aid the
area's current industrial expansion are the most immediate benefits which the residents will receive from
this merger.
Applying the statutory criteria to the proposal, we

conclude that it is in the public interest and the application is, therefore, approved.
JULY 27, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

This merger will eliminate a degree of competition
presently existing between the two banks. It will unduly increase banking concentration in the already
concentrated area of Bergen County, N.J. It will
eliminate a strong, viable, and growing independent
bank and thereby eliminate potential competition between the two banks. The competitive effect of the
proposed merger would be substantially adverse.

THE MECHANICS NATIONAL BANK OF WORCESTER, WORCESTER, MASS., AND THE INDUSTRIAL CITY BANK & TRUST
Co., WORCESTER, MASS.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Industrial City Bank & Trust Co., Worcester, Mass., which had
and the Mechanics National Bank of Worcester, Worcester, Mass. '(VIM); "
with
merged July 31, 1964, under the charter and title of the latter bank (1135).
The mereed bank at the date of merger had

On May 18, 1964, the $53 million Mechanics National Bank of Worcester, Worcester, Mass., and the
$8.5 million Industrial City Bank & Trust Co.,
Worcester, Mass., applied to the Comptroller of the
Currency to merge under the charter and with the
title of the former.
Worcester, the second largest city in Massachusetts,
has a population of 187,000. The county of Worcester
is the State's largest and extends from the border of
New Hampshire to that of Rhode Island. Its population of 583,000 is distributed among 4 cities, 56 towns
and the rural areas. The city of Worcester serves as a
manufacturing and trading center for all of central
Massachusetts. Although the dominant textile industry has experienced a decline in recent years, diversified manufacturing has increased with some industry
moving to Worcester from the Boston area. An estimated 36,000 persons are presently employed in
Worcester manufacturing a variety of products including machinery, metal items, abrasives, textiles, and
instruments. The general service area is mixed, with
farming and forestry making an important contribution




To be
operated

$8, 211 694

3

50, 491 697

2

58, 703 392

to the local economy. A slight decline in the city's
population in recent years has been due entirely to the
increasing movement to suburban areas.
The Mechanics National Bank is the third commercial bank in size in Worcester, but it is substantially
smaller than the $201 million Worcester County National Bank and the $73 million Guaranty Bank &
Trust Co. The charter bank is a unit bank, whereas
the Worcester County National Bank operates 14
branches and the Guaranty Bank & Trust Co. operates
8 branches within the same general service area. The
resulting bank will hold but 16.3 percent of deposits
and 12.4 percent of loans, and its assets of $62 million
will leave it the third commercial bank in size in
Worcester.
Thrift institutions especially are intensely competitive in Massachusetts. They not only have higher
legal lending limits and lower tax rates, but are permitted to perform many functions elsewhere restricted
to commercial banks,. Their ability to issue drafts in
the nature of checks and to make installment and col-

119

lateral loans places them in direct competition with
commercial banks. They hold 2/2 times the deposits
of commercial banks in this area—$900 million as
compared to $327 million. In addition, the larger
banks in Providence, R.I.; Hartford, Conn.; and Boston, all within 40 to 60 miles of Worcester, actively
solicit deposits and loans in this area.
There has been negligible competition between the
charter and merging banks since each has specialized
in a different kind of banking operation. The Mechanics National Bank has long followed a policy of
restricting its activities to wholesale lending and trust
work. The merging bank, which is a converted Morris
Plan Bank, has specialized in retail lending. Hence
the effect of this merger would be to unite two complementary banking operations into one full-service
commercial bank which will compete effectively with
two larger full-service commercial banks.
Applying the relevant statutory criteria, we find the

application to be in the public interest, and it is therefore approved.
JULY 22,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Mechanics National Bank of Worcester, Mass., with
assets of $53,321,000, and Industrial City Bank & Trust
Go. of Worcester, Mass., with assets of $8,534,000,
propose to merge under the charter and title of the
former. Mechanics and Industrial are, respectively,
the third and fifth largest of 11 banks in the Worcester
metropolitan area, wherein the two largest banks dominate, with a combined percentage share of the market
in deposits in excess of 70 percent, as against 16 percent
for the merging banks.
The proposed merger would eliminate all competition between the merging banks and add to the high
degree of concentration presently existing in the market area affected. In these respects, it would have an
adverse effect on competition.

FIRST & MERCHANTS NATIONAL BANK, RICHMOND, VA., AND THE FIRST NATIONAL BANK OF WAYNESBORO,
WAYNESBORO, VA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The First National Bank of Waynesboro, Waynesboro, Va. (7587), which h a d . . . .
and First & Merchants National Bank, Richmond, Va. (1111), with
merged July 31, 1964, under the charter and title of the latter bank (1111).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On April 14, 1964, the $454 million First & Merchants National Bank, Richmond, Va., and the $13
million First National Bank of Waynesboro, Waynesboro, Va., applied to the Comptroller of the Currency
for permission to merge under the charter and with
the title of the former.
Richmond, population 220,000, is the capital of
Virginia and the focal point of the State's largest trading area with an approximate population of 510,000.
Four of Virginia's six largest banks have their headquarters in Richmond. Area industry includes the
manufacturing of tobacco products, chemicals, paper
and metal products. In addition, Richmond is a retail and wholesale center, as well as the transportation
hub joining the north Atlantic and south Atlantic
seaboard. Due to its financial, manufacturing, and
120




$12,138, 496
445,919,279
457, 698, 818

To be
operated

2
35
37

commercial activity, the metropolitan area has grown
by about 25 percent in the 1950-60 period.
The charter bank, with 34 branches and 2 facilities
at the Pentagon and Fort Eustis, operates in 4 principal
areas of Virginia. On a statewide scale, its principal
competition comes from the $484 million United
Virginia Bank Shares Holding Co. banks, the $405
million Virginia National Bank, the $246 million Virginia Commonwealth Corp. banks, and the $219
million First Virginia Corp. banks.
Waynesboro, population 16,000, is located about
100 miles northwest of Richmond in the Shenandoah
Valley of west-central Virginia. The city serves a
trade area extending about 5 miles and having a
population of approximately 25,000. Growth of
Waynesboro's economy has been remarkable, with
such manufacturing industries as Dupont and General

Electric employing several thousand persons. The
transition from a rural to an Industrial-oriented economy has made the Waynesboro per capita income of
$2,605 for 1962 among the highest in Virginia. A
new $900,000 municipal building and the present construction of a $2.5 million shopping center indicate
the optimism manifested in the city's future by its
citizens and investors.
The First National Bank of Waynesboro has one
branch, which is located in Waynesboro. The only
other bank in the city, the Virginia National Bank, has
two branches in Waynesboro.
Since Virginia law was amended in 1962 to permit
banks to merge anywhere in the State and to retain the
offices of the merged bank, there has been a major
change in the banking structure of the State. Small
banks unable to serve the public adequately were replaced by larger and more efficient institutions. This
much-needed liberalization of the banking laws in Virginia has proved to be a salutary development.
The Waynesboro bank, no longer able to adequately
serve a community changing from a rural to an industrial economy, has chosen to merge with a statewide
bank which can offer a full range of services. The
credit department, investment department, and foreign
department of the charter bank will provide services
not presently offered by the merging bank. Further,
an active trust department will replace the limited trust
facilities of the merging bank which has one trust officer, a practicing attorney who serves the bank primarily
in an advisory capacity. A lending limit of $65,000
restricts the merging bank's ability to satisfy the banking needs of the medium-sized industrial and commercial concerns which depend on local banks for financing.

The competitive effect of the proposed merger will
be minimal, since the nearest office of the charter bank
is 11 miles away in Staunton, and the overlap of the
charter bank's service areas is relatively insignificant.
In the Waynesboro area, there are 14 banks operating
27 offices. In addition, active competition comes from
savings and loan associations, life insurance companies,
credit union and finance companies in the area. The
merger will provide even more stimulation to this existing competition in the Waynesboro area.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
JULY 23, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

First & Merchants National Bank is the largest bank
in Virginia. Since 1959 six banks with deposits of
$119,865,000 have been merged. The present proposed merger of First National will increase its deposits
by approximately $ 12 million. Direct competition between the banks is not significant and the remaining
competition in Waynesboro will be branches of Virginia National Bank, the second largest bank in the
State which obtained its branches in Waynesboro
through a merger consummated in 1963. The present
proposed merger will not only eliminate an independent bank but follows a pattern of increased concentration of banking in Virginia over constantly widening
areas. While the instant merger, standing alone,
would not adversely affect competition, it is part of a
trend toward concentration of banking resources in a
few hands which will have an adverse effect on competition.

THE FIRST NATIONAL BANK OF NORTON, NORTON, VA., AND THE FIRST NATIONAL BANK OF WISE, WISE, VA.
Banking offices
Name of bank and type of transaction

The First National Bank of Wise, Wise, Va. (10611), with
and the First National Bank of Norton, Norton, Va. (6235), which had
consolidated July 31, 1964, under the charter of the latter bank (6235) and
under title "The Wise County National Bank." The consolidated bank
at the date of consolidation had




Total assets

$3,618,827
7, 606, 828
11,220,914

In
operation

To be
operated
1
1
2

121

COMPTROLLER S DECISION

On May 20, 1964, the $7.5 million First National
Bank of Norton, Norton, Va., and the $3.5 million First
National Bank of Wise, Wise, Va., applied to the
Comptroller of the Currency for permission to consolidate under the charter of the former and with the title
"The Wise County National Bank."
The applicant banks are located in Wise County in
southwestern Virginia. The economy of the entire
area is severely depressed as a result of its total dependence upon the declining coal mining industry. An attempt is being made by the residents to diversify the
area's economic base in order to absorb the substantial
unemployment and remedy the related side effects.
Norton, population 5,013, is the principal trading
center for Wise County. It is located approximately
V/2 miles to the south of Wise, population 2,614, which
is the county seat for Wise County. A variety of small
manufacturing establishments in the area employ approximately 1,700, but these, together with a small
amount of farming, do not in any way compare with
coal mining as the primary economic factor. Per capita income for 1961 was $1,027, well below the $1,868
average for the State of Virginia. Mechanization of
the bituminous coal industry has made unemployment
a persistent problem, causing the younger generation
to migrate to areas with better opportunities. This
loss of young leadership is a severe drain on the future
potential of the area.

Although the banks are located only 3 miles apart,
there has been little competition between them for
either deposits or loans and there is at present an inconsequential number of common accounts. The
consolidating bank lacks the aggressive bank management which the area requires and will shortly experience a management succession problem. The communities will benefit from the consolidation as it will
create a strong,financiallysound institution to serve the
needs of this depressed area. In addition, the resulting bank will be better able to hire new and aggressive
management who will assist the area's business leaders
in recovering from its economic doldrums.
Applying the statutory criteria to the proposed consolidation, we conclude that it is in the public interest
and the application is, therefore, approved.
JULY 22, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The merging banks arc; unit institutions located 4%
miles apart in an area devoted to coal mining, small
farms, and small industries. The proposed consolidation will result in the elimination of some direct competition between the two banks. The resulting bank
will continue to be second in size in its service area and
its increased size will provide but a slight competitive
benefit.
We conclude the proposed consolidation will not
have a substantially adverse effect on competition.

THE PEOPLES-FARMERS NATIONAL BANK, MIFFLIN, PA., AND THE RUSSELL NATIONAL BANK OF LEWISTOWN,
LEWISTOWN, PA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Peoples-Farmers National Bank, Mifflin, Pa. (9678), with
and the Russell National Bank of Lewistown, Lewistown, Pa. (10506), which
had
merged July 31, 1964, under the charter of the latter bank (10506) and title
"the Russell National Bank." The merged bank at the date of merger had..

COMPTROLLER S DECISION

On May 8, 1964, the $19.6 million Russell National
Bank of Lewistown, Lewistown, Pa., and the $5.3 million Peoples-Farmers National Bank, Mifflin, Pa., applied to the Comptroller of the Currency for
permission to merge under the charter and with the
title of the former.
122




To be
operated

$5, 545, 885

2

19,149, 806

2

24, 669, 926

4

Mifflin, home of the merging bank, has a population
of 900 and serves a prosperous agricultural area. It
is located 12 miles east of Lewistown in Juniata
County. The Peoples-Farmers National Bank has its
sole branch in nearby Thompsontown.
The charter bank is located in Lewistown, the
county seat of Mifflin County. With a population of

14,000, Lewistown is located In the central part of
the State, midway between Harrisburg and Altoona.
Although it has experienced some economic difficulties,
the city is attracting industrial development and can
show solid gains in both primary and fabricating industries with numerous national manufacturers locating there. The charter bank has one branch located
in suburban Burnham.
The trade areas of the two banks, because of their
geographic proximity, must be considered as one.
Many persons commute daily from Mifflin to Lewistown for employment and the economic ties of the
two communities are very close.
Mifflin County is the headquarters of five commercial banks. These banks operate nine offices and hold
total deposits of $38.4 million. All the banks in both
counties may be considered to be in competition with
each other.
Two local competitors and seven other competitors
in the Juniata River Valley will continue to serve the
area. The bank will extend and enhance banking
services to the people in both Juniata and Mifflin
Counties and, through the facilities of four offices in
Lewistown, Burnham, Mifflin and Thompsontown, will
strengthen the economic growth of both counties.
The merging bank has not provided managerial succession and now faces the prospect of the retirement
of its executive officer. This dilemma has forced the
bank to turn to merger as the only practicable solution
to its management succession problem.

Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
JULY 17, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Russell National Bank of Lewistown is the largest bank in Mifflin County with 41 percent of the I.P.C.
deposits and loans therein. Along with the second
ranking bank, it accounts for about 75 percent of the
county's I.P.C. deposits and loans.
Peoples-Farmers National Bank is the second largest bank in Juniata County, which adjoins Mifflin
County. It has 23.1 and 19.3 percent, respectively,
of this area's I.P.C. deposits and loans while the largest bank accounts for 28.6 and 35.5 percent, respectively, of such deposits and loans. The remaining
banks are approximately equal in size.
There does not appear to be a significant amount
of direct competition between the merging banks that
would be eliminated by approval of this transaction.
On the other hand, this merger would tend to enhance
the Charter Bank's leading position in Mifflin County;
to increase the high level of concentration in commercial banking therein; to establish comparable concentration in the resulting bank's two-county service area;
and to upset the comparative balance among the much
smaller banks in Juniata County.
The proposed merger, therefore, would appear to
have an adverse effect on competition.

THE CITIZENS & SOUTHERN NATIONAL BANK OF SOUTH CAROLINA, CHARLESTON, S.C.,
NATIONAL BANK, ROCK HILL, S.C.

AND THE PEOPLES

Banking offices
Name of bank and type of transaction

Total assets

The Peoples National Bank of Rock Hill, Rock Hill, S.C. (9407), which had
and the Citizens & Southern National Bank of South Carolina, Charleston,
S.C. (14425), with
merged Aug.l, 1964, under the charter and title of the latter bank (14425).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On May 29, 1964, the $172.3 million Citizens &
Southern National Bank of South Carolina, Charleston, S.C, and the $17.4 million Peoples National Bank,
Rock Hill, S.C, applied to the Comptroller of the
Currency for permission to merge under the charter
and title of the former.




In
operation

To be
operated

$18,541,535

3

175, 232, 427

31

193,690,936

34

Citizens & Southern is the second largest bank in
South Carolina operating 31 offices in 15 communities
situated in 10 counties. Its largest community service
areas are Charleston, population 78,000, which is
located in the southeastern section of the State;
Columbia, population 98,000, which is in the south
central section of the State; and Spartanburg, popula123

tion 45,000, which is in the northwestern portion of
South Carolina.
The economic base of the communities in which
Citizens & Southern National operates is varied. During the past two decades the State of South Carolina
has been rapidly changing from a predominately
agricultural economy to one of mixed composition between agriculture and industry. A large part of the
economy of the State is dependent upon the military,
particularly in the Charleston and Columbia areas.
The merging bank is situated in Rock Hill, population 31,000, where its 3 offices are located. The Rock
Hill economy is dependent primarily upon the textile
and allied industries which furnish employment for
nearly 9,000 persons. Other products manufactured
in the area include paper, bus and truck bodies, together with food and beverage processing.
The Peoples National Bank has been unable to solicit
successfully the loan business of the large manufacturing industries in the Rock Hill area due to its inability
to extend sufficient credit for the companies' needs.
Many of these firms have been required to go to other
communities, both in and out of the State, for financial
assistance. Because of its size, the merging bank has
been unable to offer all the services needed in the community. While servicing installment paper for automobile and personal loans, the merging bank has not
gone into the area of appliance or other such paper.
Nor has the Peoples National Bank been able to develop a depth of management capable of adequately
caring for the expanding business needs of the Rock
Hill area.
Citizens & Southern has a long history of gearing
its programs to the needs of the communities in which
it operates by offering its customers a complete range
of banking services. Through the offering of new and
more complete services and convenience of facilities,
aided by high-speed electronic equipment, Citizens &
Southern has been able to extend its services without
unduly increasing customer charges.
Approval of the merger will have no effect upon
competition between the merging banks. The resulting institution will be competitive in Rock Hill with
the largest bank in South Carolina, which has received
approval to open a branch there. The merger will
provide a stimulus to the economy of Rock Hill and
make additional resources available for future economic growth. The public will benefit by the creation
of new and improved facilities and the addition of a
full-service bank. Younger and more aggressive
management will stimulate competition.
124




On balancing the facts of this case in light of the
statutory criteria, we find that the merger is in the
public interest and the application is, therefore,
approved.
JULY 31,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Citizens is the second largest of 4 statewide commercial banks in South Carolina with about 13.4 percent
of the State's commercial bank deposits and 41 offices
located in 7 different areas in the State. Peoples has
3 offices located in Rock Hill, S.C. (population
31,000), which is in York County in north central
South Carolina and 60 to 70 miles from Citizens' nearest offices. Peoples has total deposits of $15,613,000,
about 1.4 percent of total deposits of all banks in the
State and 47 percent of deposits in York County.
There appears to be little existing competition between
the merging banks due to the distances between their
respective offices.
South Carolina's banking resources are highly concentrated in the four large statewide instituions, partly
as a result of prior mergers. Together they control
52.8 percent of the State's total deposits. These 4
banks have acquired 26 smaller banks in the past decade, and at the same time have been opening numerous de novo branch offices. (The proposed merger
would be Citizens' third acquisition in 1964.) Such
acquisitions by one of the four dominant banks have
often led directly to a similar acquisition by one of the
others, with the result that the only independent banks
in a number of South Carolina communities have been
eliminated from competition and remaining unit banks
in nearby communities have been subjected to direct
competition with offices of much more powerful
institutions.
The proposed merger is the most recent in this
process, which, if unchecked, threatens to concentrate
South Carolina's banking resources in just four large
branch systems. By it Citizens would acquire the
banking business of by far the largest independent bank
in Rock Hill and York County and add about 1.4
percent to its share of the statewide banking market.
At the same time, the merger would tend to motivate
the other statewide systems to respond with similar acquisitions, and the smaller banks in Rock Hill and the
surrounding area which are now in most direct competition with Peoples might be receptive to such proposals
to insure their survival in competition with Citizens.
As a result, concentration at the statewide level would
be further enhanced at the expense of independent
banking in the Rock Hill area.

In view of the history of bank mergers in South
Carolina, and its cumulative effect upon competition,
the proposed merger threatens to have a substantial

adverse effect on competition and may aggravate the
trend toward oligopoly and eventual monopoly in that
State.

THE ASHLAND NATIONAL BANK, ASHLAND, PA., AND THE PENNSYLVANIA NATIONAL BANK & TRUST CO., POTTSVILLE, PA.
Banking offices
Name of bank and type of transaction

Total assets

COMPTROLLER S DECISION

1

52,012,755

9

56,164,629

10

lem which has split the board of directors of the merging bank into two opposing factions. In addition, the
resulting bank will augment and extend the banking
services available to the people of Pottsville and Ashland. Both communities will benefit from a stronger
financial institution possessing management depth
which will have a catalytic effect on the area's economic recovery.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest
and the application is therefore approved.
JULY 31,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Pennsylvania National Bank & Trust Co., the
purchasing bank, was founded in 1866. Its head
office and one of its branches are in Pottsville, Pa.,
and its other seven branches are from 5 to 19 miles
from the head office. As of May 15, 1964, it had total
assets of $51,527,000, total deposits of $7,702,000, of
which $13,761,000 were demand deposits and $30,967,000 time and saving deposits, and total loans of
$24,537,000.
Its Centralia branch, acquired in 1955, is but 3 miles
north of the office of the selling bank and its Girardville branch, acquired May 8, 1964, is but 3 miles east
of the office of the selling bank.
The application shows that Ashland is a community
with a population of over 5,000, which has the following 2 banks:
Deposits

Ashland National Bank (Selling Bank).
Citizens National Bank. . .,




To be
operated

$5,125, 778

The Ashland National Bank, Ashland, Pa. (5615), with
and Pennsylvania National Bank & Trust Co., Pottsville, Pa, (1663), which
had
merged Aug. 7, 1964, under charter and title of the latter bank (1663). The
merged bank at the date of merger had

On June 1, 1964, the $51.5 million Pennsylvania
National Bank & Trust Co., Pottsville, Pa., and the
$4.9 million Ashland National Bank, Ashland, Pa.,
applied to the Comptroller of the Currency for permission to merge under the charter and with the title
of the former.
Ashland, a community of 5,237 serving a trading
area of 50,000, is located 17 miles northwest of Pottsville. Its economy has historically been dependent on
anthracite coal mining, which has been in a steady
decline over the past decade, but has been supplemented by a small amount of clothing manufacturing
and metal fabricating.
Pottsville, home of the charter bank, has a population of 21,659 and is located on the southern edge of
the Pennsylvania anthracite coal fields. Despite having experienced some economic difficulty, the city recently has had some success in attracting new industry.
Within a 19-mile radius of Pottsville, the charter
bank operates nine offices, two of which are located
3 miles from the merging bank. It is the largest bank
in the area and presently holds 18.3 percent of the
area deposits and 19.7 percent of the loans. After
the merger, the resulting bank will hold 20 percent
of the deposits and 21.6 percent of the loans. However, competition will remain keen by reason of 24
other commercial banks operating a total of 30 banking
offices in the area.
The merger will solve a difficult management prob-

In
operation

$4, 962, 000
7, 879, 000

$4, 329, 000
6, 358, 000

Loans and
discounts
$2,511,000
3, 809, 000

125

Should this application be approved, the Citizen's National Bank will face the direct competition of a bank
more than seven times its size.
Mount Carmel, 4 miles west, Centralia, 3 miles
north, and Girardville, 3 miles east, in addition to Ashland, may well constitute the service area of the selling
bank and should the purchasing bank be permitted to
acquire the selling bank it will have 3 of the 7 banking offices in that area with 61.9 percent of the total
resources; 63.4 percent of the total deposits; and 65.1
percent of the total loans and discounts of all of the
banks in the area. [Cf. U.S. v. First National Bank
<& Trust Co. of Lexington (36—October term 1963,

decided April 6, 1964), in which the Supreme Court
held a merger to violate the Sherman Act, wherein the
resulting bank would have 51.95 percent of the total
deposits and 54.2 percent of the total loans of all
commercial banks in Fayette County, Ky.].
It clearly appears, therefore, that the proposed
merger of the Ashland National Bank, Ashland, Pa.,
into Pennsylvania National Bank & Trust Co., Pottsville, Pa., will eliminate competition between the participating banks and will have a substantial adverse
effect on competition and further a tendency toward
monopoly in the area involved.

THE FIRST NATIONAL BANK OF MOUNT HOLLY SPRINGS, MOUNT HOLLY SPRINGS, PA., AND CUMBERLAND COUNTY
NATIONAL BANK & TRUST CO., NEW CUMBERLAND, PA.
Bankin g offices
Total assets

Name of bank and type of transaction

In
operation

The First National Bank of Mount Holly Springs, Mount Holly Springs, Pa.
(8493), with
and Cumberland County National Bank & Trust Co., New Cumberland, Pa.
(14542), which had
merged Aug. 7, 1964, under charter and title of the latter bank (14542).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On May 26, 1964, the First National Bank of Mount
Holly Springs, Mount Holly Springs, Pa., and the
Cumberland County National Bank & Trust Co., New
Cumberland, Pa., made application to the Comptroller of the Currency for permission to merge under the
charter and title of the latter.
The sole office of the $5.1 million First National
Bank of Mount Holly Springs is located in the borough
of Mount Holly Springs, which has a population of
1,800 and is in the south central part of Cumberland
County, 7 miles south of Carlisle and 27 miles southwest of Harrisburg. The borough, which is mainly
residential, is a center for the surrounding agricultural
area with a population of 25,000.
The charter bank, the $38.5 million Cumberland
County National Bank, has its main office in New Cumberland, a community located across the Susquehanna
River from Harrisburg. It has four other offices in
Cumberland County, two in Camp Hill, one in Boiling
Springs, one in Lemoyne and two military facilities at
the Army depot in New Cumberland and the Navy
depot in Mechanicsburg. All of these locations are
126




To be
operated

U, 946, 697

1

39, 528, 778

5

44} 475> 475

6

in the area known as the "West Shore." Because of
easy highway access and railroad facilities, the area
has been developing industrially. It also contains a
number of Federal installations. The immediate New
Cumberland area serves as a residential suburb of
Harrisburg.
There is little competition between the merging
banks. The nearest office of the charter bank to the
merging bank is its Boiling Springs branch, which is
located 5 miles northeast of Mount Holly Springs in a
separate community. Its other branches are all 18 or
more miles distant from the merging bank. The
major consideration in assessing competition in Cumberland County, the home of both banks, must be the
Dauphin County banks which operate branches in
Harrisburg directly across the Susquehanna River and
two of which operate a total of five branches in Cumberland County itself. These are substantial institutions, three of which have assets in excess of $100
million. Additionally, there are 15 competing offices
of other banks in Cumberland County.
Consummation of the merger will enable the charter
bank to compete more effectively with the larger Harrisburg banks, two of which will remain three times

the size of the resulting bank, and with all the Dauphin
County banks operating in the West Shore area. Not
only will the resulting bank profit from economies of
operation, but the Mount Holly Springs area will gain
by the introduction of the larger lending capabilities,
trust facilities, and other services of the charter bank.
In considering the facts of this case in light of the
relevant statutory criteria, we find this merger to be in
the public interest and the application is, therefore,
approved.
JULY 31,

1964

SUMMARY OF REPORT BY ATTORNEY GENERAL

Cumberland County National Bank & Trust Co.
proposes to acquire the First National Bank of Mount
Holly Springs. The latter had, as of April 15, 1964,
total assets of $5 million, total deposits of $4.5 million,
and loans and discounts of $3.2 million. It operates
no branches, provides normal banking services on a
relatively limited scale, and does not maintain a trust
department.

Cumberland County National Bank & Trust Co.
operates through a main office at New Cumberland,
Pa., and six branches in the surrounding territory. It
offers full banking services, backed by resources of
$37.7 million.
The proposed merger involves the fourth largest of
the banks operating in Cumberland County, Pa., adjacent to the city of Harrisburg, and a relatively small
bank serving a single community within that territory.
The closest office of Cumberland is 5.9 miles from
Mount Holly Springs and available information indicates there is no substantial competition between the
two banks which would be eliminated.
Three Harrisburg-based banks operating in the area
will continue to be substantially larger than Cumberland. There will also be two banks of comparable size
andfivesmaller banks.
It is our view that the adverse effects on competition
resulting from this merger will not be significant.
However, existing concentration of banking in Cumberland County will be somewhat increased and further
mergers may be induced.

THE FIRST NATIONAL BANK OF WEST MIDDLESEX, WEST MIDDLESEX, PA., AND THE FIRST NATIONAL BANK OF
MERCER COUNTY, GREENVILLE, PA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The First National Bank of West Middlesex, West Middlesex, Pa. (6913), with.. .
and First National Bank of Mercer County, Greenville, Pa. (249), which had. .
merged Aug. 8, 1964, under the charter and title of the latter bank (249).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On May 25, 1964, the $32 million First National
Bank of Mercer County, Greenville, Pa., and the $3.5
million First National Bank of West Middlesex, West
Middlesex, Pa., applied to the Comptroller of the Currency for permission to merge under the charter and
title of the former.
Greenville, in the extreme western part of the State,
is the site of the charter bank's home office and four of
its eight branch offices. With a population of 8,236,
the city is the center of the most significant trade area
in northwestern Mercer County, which is on the Ohio
border. The economy of Greenville's trade area is
dependent upon a diversified and developing industrial
complex. Large employers such as Westinghouse
Electric and Greenville Steel Car Co., along with 16




$3, 724, 634
33, 646, 698
37, 371, 333

To be
operated
1
8
9

other manufacturing concerns, provide the principal
economic support for the Greenville market, the population of which is estimated at about 25,000. Industrial growth in this area has buttressed an already stable
economy, and the charter bank has been an active participant in that growth. The proposed merger will not
affect the ability of the charter bank to meet the needs
of Greenville or its environs, but it will extend its
dynamic leadership into the southern part of Mercer
County.
The merging bank, located in the rural community
of West Middlesex in southwestern Mercer County,
serves some 3,000 people. With a population of 1,301,
the town has but a limited amount of industrial
activity. Most of the area residents are employed by
industry or commerce in the Shenango Valley or
Youngstown, Ohio, areas.
127

There is virtually no competition between the two
banks as the charter bank's senior officers own approximately 70 percent of the outstanding stock of the
merging bank. It is clear that the influence of the
charter bank is the determining factor in the formulation of the merging bank's policies.
Substantial advantages of the merger will accrue to
the West Middlesex public. New services such as a
progressive trust department and an increased lending
power will permit the resulting bank to better serve
the needs and conveniences of the area.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
JULY 31, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger would permanently end such
competition as exists between the participating banks

already seriously compromised in existing at all due to
common ownership and control. It would also eliminate the only remaining independent bank in the western part of Mercer County and further increase the
already high degree of banking concentration in this
area. Previous reports regarding mergers and acquisitions in this area have noted that of an original 14 separate and independent banks in Mercer County only
4 remained; and that of 38 banks with offices in the
4-county area of Venango, Clarion, Mercer, and Crawford Counties in northwest Pennsylvania, 18 have been
acquired by other banks in the past 10 years. It was
predicted that further acquisitions involving the remaining banks "may be expected if this merger trend
is not stopped soon." This proposed merger would
constitute just such a transaction. It would be a further step in a strong trend to banking concentration by
merger and acquisition. Accordingly, we conclude it
would have seriously adverse effects on competition.

STATE BANK OF NAPPANEE, NAPPANEE, IND., AND THE FIRST NATIONAL BANK OF ELKHART, ELKHART, IND.
Banking offices
Total assets

Name of bank and type of transaction

In
operation

State Bank of Nappanee, Nappanee, Ind., with
and the First National Bank of Elkhart, Elkhart, Ind. (206), which had
merged Aug. 15, 1964, under the charter of the First National Bank of Elkhart (206) and title "The First National Bank of Elkhart County." The
merged bank at the date of merger had

COMPTROLLER S DECISION

On June 18, 1964, State Bank of Nappanee, Nappanee, Ind., and the First National Bank of Elkhart,
Elkhart, Ind., applied to the Comptroller of the Currency for permission to merge under the charter of the
latter and under the title "The First National Bank of
Elkhart County."
The sole office of the $8.9 million merging bank is
located in Nappanee, a community of 4,000 persons
situated 17 miles south of Elkhart. The city services
a primarily agricultural area where livestock raising is
the major occupation. Some industry, particularly
the manufacture of furniture and wood products, also
contributes to the local economy. Because of the economies to be gained, larger operations in the hog raising, cattle feeding, and poultry fields are becoming predominant, with a resulting increase in loan demands
which the merging bank is incapable of satisfying.
128




$9, 207, 063
75, 449, 430
84, 656, 493

To be
operated
1
6
7

The $72.2 million First National Bank of Elkhart
has four of its six offices in Elkhart and one each in the
nearby communities of Bristol and Dunlap. Elkhart,
a city of 42,000 on the St. Joseph and Elkhart Rivers,
is situated in the north-central part of the State, 15
miles east of South Bend, and just 5 miles south of
the Indiana-Michigan boundary. The service area
encompasses 75,000 people and is largely industrial,
although outlying farms contribute substantially to the
economy. Elkhart is a railway center and its industries manufacture electronic parts, metal and paper
products and pharmaceuticals. In addition, 90 companies are engaged in the manufacture of mobile
homes, trailers, and related parts.
There is no substantial competition between the
merging banks. Accordingly, no reduction of competition nor trend toward monopoly can be foreseen.
While consummation of the proposal will convert the
merging bank into a branch, it will leave at least 15

directly competing offices of other banks in the immediate area. Four substantial banks in nearby South
Bend, along with seven smaller banks in the area, also
will continue to offer credit alternatives.
The charter bank's position will not be strengthened
very substantially, for while it has long been the largest bank in Elkhart, its pro rata share of banking assets
in the community has been declining in recent years
and its two major competitors, the $47.1 million St.
Joseph Valley Bank and the $15 million First Old
State Bank, have an equal number of branches in the
city.
The merger will offer more abundant funds and
services to Nappanee and encourage the growth of
that community. The benefits of seasoned executive
judgment of the charter bank's officers and the use of
electronic data processing will result in greater operating efficiencies.
Considering the facts of this case in light of the
statutory criteria, we find this merger to be in the public interest and it is therefore approved.

AUGUST 14, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The First National Bank of Elkhart is the largest
bank in the Elkhart, Ind., area, holding 52.8 percent
of total deposits and 53.1 percent of total loans. The
proposed merger would increase First National's percentage of both deposits and loans to about 56 percent.
In the Elkhart area, there are only three banks, two
of which, First National and St. Joseph Valley Bank,
control almost 90 percent of the total deposits and
loans.
In Nappanee, Ind., 17 miles south of Elkhart, an
area experiencing a diversification and expansion of
its industrial base, the resulting bank would dominate
the area.
By virtue of the dominance of the resulting bank and
the high degree of concentration in the relevant area,
the probable effect of the proposed merger on competition would be adverse.

THIRD NATIONAL BANK IN NASHVILLE, NASHVILLE, TENN., AND NASHVILLE BANK & TRUST CO., NASHVILLE,
TENN.
Banking offices
Name of bank and type of transaction

Total assets

The Nashville Bank & Trust Co. Nashville, Tenn., with
and Third National Bank in Nashville, Nashville, Tenn. (13103), which had. .
merged Aug. 18, 1964, under the charter and title of the latter bank (13103).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On April 27. 1964, the $341.7 million Third National Bank in Nashville, Nashville, Tenn., and the
$45.9 million Nashville Bank & Trust Co., Nashville,
Tenn., applied to the Comptroller of the Currency
for permission to merge under the charter and with
the title of the former.
Nashville, in the heart of the TVA service area, is
the State capital of Tennessee. With an estimated
metropolitan population in excess of 400,000 persons,
reflecting a 24 percent increase since 1950, Nashville's
population growth compares most favorably with the
5 percent increase in population of the neighboring
States of Alabama, Kentucky, Mississippi, and the rest
of Tennessee, which Nashville serves. The city is the
focal point of a community constituting eight counties
whose residents are dependent upon Nashville for such




$47, 981, 502
382,138,104
428,218,003

In
operation

To be
operated

2
15
17

necessities as shopping, employment, and medical care.
Its wholesale trade area stretches across middle Tennessee into southern Kentucky, northern Alabama,
and northern Mississippi and contains an estimated
population of 2,265,800 persons. This area, which
bridges the North and the South of our country,
enjoys a diversified economy dependent on agriculture,
industry, and commerce. The growth of this economy
has been spurred by the availability of abundant and
cheap electric power from TVA, and by such U.S.
Government installations as Redstone Arsenal at
Huntsville, Ala., and the Arnold Development Center
at Tullahorna, Tenn. The availability of low-cost
labor, cheap power, excellent transportation facilities
by air, highway and rail, gas and petroleum pipelines,
and an abundant water supply favors Nashville's role
as a center of the burgeoning mid-South.
129

The charter bank, founded in 1927, has grown,
through capable and agressive management, into a system having 14 branch offices. It is particularly active
in the correspondent banking field and now has a substantial number of correspondent banks, most of which
are located within a radius of 250 miles. Within this
region it competes vigorously with the large banks in
northeastern Georgia, northern Alabama, western
North Carolina, Kentucky and Tennessee, although
holding only 3.13 percent of total regional loans and
deposits. Within the Nashville wholesale trade area,
which covers middle Tennessee, southern Kentucky,
northern Mississippi and northern Alabama, the charter bank's share of total bank loans and deposits is but
12.5 percent. In the Nashville community, which consists of the city and eight surrounding counties, the
charter bank holds about 29.7 percent of deposits
while its closest competitors, the $393.3 million First
American National Bank, Nashville, and the $217.4
million Commerce Union Bank, Nashville, hold 34.9
and 18.1 percent of deposits, respectively.
The merging bank, chartered in 1889 as a trust
company, passed through a merger and reorganization
and emerged in 1956 with its present title. In 1959
the bank opened its first and only branch. Prior to
January 1964, it was controlled by a wholesale grocery
firm, which sold its stock in the merging bank to a
syndicate controlled by insurance interests. The new
owners soon found that injection of a substantial
amount of capital and effort would be required both to
make the bank a competitor in the Nashville area and
a profitable undertaking for the owners. Having no
desire to divert their attention from the insurance field
and being unwilling to put large sums into the bank,
these interests gave consideration to the merger route
for a solution. They were prompted in part by the
fact that, during the period since assuming control, deposits in the merging bank declined from $45.4 million to $39.6 million, despite an increase of $1.1 million
in public fund deposits. By contrast, deposits in the
other three banks in the city rose sharply after 1960 and
continued to rise. Many of the merging bank's customers, who previously felt obligated to maintain deposits in the bank because of their business connections
with the previous owners, the wholesale grocery firm,
indicated that they were then free to move their accounts to larger banks. Additionally, the change of
ownership resulted in a substantial loss of accounts in
the bank's trust department.
One of the most determinative factors in the consideration of this merger is the problem of management succession. This Office has stated time and again
130




that a bank is only as good as its management. In
the case of the merging bank, the president is ill and
anxious to retire. Further, there is no provision for
succession. The dearth of young management personnel and the unlikelihood of attracting new employees to the merging bank is due to the below-average salary scale and the lack of an adequate pension
plan. The present owners of the bank show no intention of instituting costly reforms to attract employees
capable of making the bank a vigorous competitor,
responsive to the needs of the community. As a result,
the merging bank is presently noncompetitive. Only
through merger with the charter bank, where the resulting bank will be a National Bank, will this Office
have an opportunity to assist this noncompetitive statechartered institution as well as the people of the Nashville community. We would, indeed, be derelict in our
responsibilities to protect the public interest in banking
were we to impede effective management from assuming the responsibilities of a declining and leaderless
merging bank.
We turn now to the future earnings prospects of the
applicant banks, another criterion established by law
in the consideration of bank mergers. The future
earnings prospects of the merging bank, in its present
condition, are very gloomy. The recent substantial decline in deposits in the phlegmatic and incapacitated
management bode ill for future earnings of the bank
unless remedial steps are taken. If merger is the remedy, however, as we are convinced it is, the future
earnings prospects of the resulting bank are excellent
because of the dynamic management, existing branching system and operating efficiency of the charter bank.
Only minimal competition exists between the two
applicant banks due to difference in size and to diversity of market interests. As stated above, the charter
bank serves numerous correspondent banks throughout
its region. These correspondent banks' deposits account for 18.7 percent of the charter bank's deposits,
as compared to the merging bank's correspondent deposits which amount to only 1.2 percent of the merging bank's deposits. Commercial loans make up 40
percent of the charter bank's total loans, but only 25.7
percent of the merging bank's total loans. Further contrast can be seen in the fact that, while real estate
loans account for only 0.8 percent of the charter bank's
loans, such loans constitute 34 percent of the merging
bank's loans.
While the cold statistics presented by the application may indicate at first blush that some competition
now exists between the applicants and that it will be
eliminated by this merger, closer analysis of the com-

plete picture dispels this hasty conclusion. A bank's
competitive force in its community depends greatly
upon the attitude of its management and board of directors. To assess accurately competition between two
banks, an effort must be made to weigh the aggressiveness, the capability, the experience and the desire of
the management of each to compete. When, as in this
case, we find that the management of the merging
bank is more interested in insurance than in banking,
has no desire to maintain the bank's relative standing
in the banking community, and has made no effort
to improve its internal operating procedures nor elevate the morale of its personnel through better salaries
and an improved pension plan, we cannot realistically
view it as a competitive bank. When a bank, such as
the merging bank, is not disposed to compete, it is
idle to speak of the elimination of competition by reason of a merger.
The hallmark of modern banking is branch competition. The inability of the merging bank to effectively
serve the public is graphically illustrated in its failure
to develop a modern branching system despite the fact
that it was founded in 1889. With the three largest
banks in Nashville having 20, 15, and 20 offices,
respectively, it is manifest that Nashville Bank & Trust
Co., with a single branch, cannot compete in the important area of branching.
The competition for funds in the Nashville community is not confined to commercial banks. It must
be noted that savings and loan associations are particularly strong competitors. While competition is
most desirable and indeed a basic tenet of the American economic system., the advantages to savings and
loan associations arising from higher permissible interest and dividend rates, as well as tax privileges not
available to commercial banks, make a difficult competitive situation for the banks. This fact is reflected
in the 325 percent increase in savings and loan share
accounts in the Nashville community since 1953 and
the opening of three new savings and loan association
branches during the past year. There is certainly a
need for a stronger institution to compete for funds in
such a market.
There is no tendency toward monopoly in the Nashville area or community. The charter bank has never
been involved in a merger since its founding in 1927;
its rapid growth has been internal. The number of
Nashville banks has not declined during the past 30
years. Indeed, a relatively new bank, the Capital City
Bank, which was chartered in 1960, now has almost
$7.5 million in resources and two branches. There is




hardly a monopoly when a new bank can enter the
market and prosper so remarkably in such a short time.
One of the best qualified authorities on banking in
Tennessee has recognized the fact that the merger will
be a salutary development. In a letter of April 25,
1964, Mr. M. A. Bryan, Superintendent of Banks, State
of Tennessee, said of the proposed merger:
The competitive factor in my opinion will not be lessened
by the merger. This assumption is based on the evident competition which now and will exist between existing First American National Bank, largest Nashville bank3 the Commerce
Union Bank, in third position, and Third National Bank,
second in size, the surviving institution of the merger between
themselves and Nashville Bank & Trust Go. which holds a
minor position in the field insofar as competition is concerned.

Consummation of the proposed merger will improve
the charter bank's ability to serve the convenience and
needs of the Nashville public. It will be better able
to meet the credit needs of its larger customers throughout the Nashville wholesale trade area. Automation
will improve the operating efficiency for the benefit
of the merging bank's customers. Increased salaries
and other incentives such as the charter bank's pension
plan will improve the morale of the merging bank's
personnel. The more numerous banking services offered through the resulting bank's extensive branch
system will better serve the needs of the merging
bank's customers. Further, the assets of the merging
bank will be pooled with those of the charter bank to
be used more efficiently in promoting the economic
well-being of the people of the Nashville community,
the wholesale trade area which it serves, and the midSouth region of which it is the center.
In the light of all of the facts and circumstances
here present, we are compelled to conclude that this
merger application has met the statutory criteria and
will promote the public interest. The application is
therefore approved.
AUGUST 4, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The primary area of competition involved in this
proposed merger is metropolitan Nashville, an area
which is coextensive with Davidson County and the
outer limits of permissible branching for Nashville
banks. The area is already highly concentrated with
the 3 largest banks holding more than 93 percent of
all deposits and loans in the 6 Nashville banks, and
more than 82 percent of total deposits and loans held
by all 34 banks in Davidson County, and 7 surrounding
counties. The proposed merger would unite the area's
second and fourth largest banks and increase concentration to a significant degree. The resulting bank
131

would be the largest lender and holder of savings
deposits in the entire area with more than 40 percent
of total loans held by Nashville banks and 36 percent
of total loans held by all 34 banks in the 8 counties;
it would hold 46 percent of all automobile loans and
33 percent of all savings deposits held by commercial
banks in the area. An important source of banking

credit and service would be eliminated for individual
and small business borrowers in metropolitan Nashville, and the many smaller banks in the area would
be further disadvantaged in their competitive efforts.
The proposed merger would have a severely adverse
effect upon competition in metropolitan Nashville and
the surrounding area.

THE FIRST SECURITY BANK OF IDAHO, NATIONAL ASSOCIATION, BOISE, IDAHO, AND THE FARMERS BANK, KENDRICK,
IDAHO
Banking offices
Name of bank and type of transaction

Total assets

The Farmers Bank, Kendrick, Idaho, with
was purchased Aug. 21, 1964, by First Security Bank of Idaho, National Association, Boise, Idaho (14444), which had
After the purchase was effected, the receiving bank had

On June 1, 1964, the First Security Bank of Idaho,
National Association, Boise, Idaho, applied to the
Comptroller of the Currency for permission to purchase the assets and assume the liabilities of the $3.2
million Farmers Bank, Kendrick, Idaho.
Boise, with an estimated population of 60,000, is
the head office of the purchasing bank and the largest
city in Idaho. Located on the main line of the Union
Pacific Railroad and served by numerous truck lines,
the city is a distribution center for a trade area with
a population in excess of 100,000. The 150 lightindustry firms in Boise are connected primarily with
the basic agriculture of the State and with the construction industry.
The purchasing bank, with 40 operating branches,
2 approved but unopened branches, and a facility at
Mountain Home Air Force Base, serves the entire
State of Idaho. It is second in size to the Idaho First
National Bank, Boise, Idaho. Nine other banks,
ranging in size from the Bank of Idaho, Boise, to the
Bank of Central Idaho, Greenville, Idaho, compete
for deposit accounts and profitable loans.
Kendrick, population 450, is an agricultural community located 27 miles northeast of the major trading center of the area, Lewiston, and about 300 miles
north of Boise. Although the region contains forest
lands and logging operations, the economy largely depends on farms which principally produce wheat.
Most of the farms are operated by the owners and
are quite profitable. Together with crops and livestock operations, two grain elevators and a dry bean
elevator compose the economic structure of Kendrick.
132




In
operation

To be
operated

$3, 205, 007

1

267, 058, 205
269,688,213

40
41

The selling bank is the only bank in Kendrick.
The closest bank is the First Bank of Troy which is 13
miles from Kendrick. Three banks in Lewiston and
three banks in Moscow, Idaho, as well as banks in
two other nearby towns, extend credit to interests in
Kendrick.
The selling bank has conducted a limited general
banking business since it was organized in 1908. It
has participated very little in the real estate and the
consumer loan fields. Its small lending limit is partly
responsibe for the fact that a number of large farm
operators, lumber firms, and warehouse enterprises in
the Kendrick area secure their credit outside Kendrick.
The purchasing bank, with greater resources and more
aggressive policies, will meet these difficulties and increase banking convenience in the Kendrick area.
The former president and largest shareholder died
recently and no successor has replaced him. The
bank, now being managed by the cashier who has
reached retirement age, has developed no other officer.
The purchasing bank will be able to solve the
management succession problem in Kendrick.
The merger will not change the competitive structure in Boise nor in the State at large, as the purchasing
bank's share of State deposits will increase by a mere
0.4 percent. There are no common borrowers, depositors or shareholders of the applicant banks. Because
the selling bank finds itself in a dilemma resulting from
no management depth, the merger route is the only
viable means of retaining a bank in Kendrick which
would provide competition in that northwestern section
of Idaho.

Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
AUGUST 18,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The First Security Bank, the second largest with
deposits of over $242 million, operates 40 banking
offices, 7 of which have been acquired since 1952 with
deposits of over $27 million.
Farmers Bank is located in the small town of
Kendrick about 19 miles distant from the closest branch
of First Security. Deposits of Farmers Bank total
$2,850,000.
Direct competition between the participating banks
is very limited. The chief competition of Farmers

Bank is the First Bank of Troy, a small independent
bank which will hereafter compete with the second
largest bank in Idaho.
First Security has 31.5 percent of all Idaho bank
deposits and 29 percent of the banking offices in the
State. The three largest banks in Idaho have 76.6
percent of the total deposits of all Idaho banks and
93 of the 139 banking offices in the State. Since 1952,
these 3 banks have acquired 18 banks with 22 banking
offices. While each acquisition of a small bank, considered separately, may not necessarily result in a substantial lessening of competition, the cumulative effect
of a series of small acquisitions, of which the present is
an example, must inevitably be substantially adverse.
Thus, any further acquisition by Security Bank involves
an adverse competitive effect and a tendency toward
monopoly.

FIRST NATIONAL BANK & TRUST CO., AND THE GEORGETOWN NATIONAL BANK, BOTH OF GEORGETOWN, KY.
Banking offices
Name of bank and type of transaction

Total assets

The Georgetown National Bank, Georgetown, Ky. (8579), with
and First National Bank & Trust Co., Georgetown, Ky. (2927), which had. .
merged Aug. 29, 1964, under charter of the latter bank (2927), and under the
title "First Georgetown National Bank & Trust Co." The merged bank at
the date of merger had

COMPTROLLER'S DECISION

On March 2, 1964, the $7.6 million First National
Bank & Trust Co. and the $6 million Georgetown National Bank, both of Georgetown, Ky., applied to the
Comptroller of the Currency for permission to merge
under the charter and title of the former.
Georgetown, the county seat of Scott County, is
located in the north central part of Kentucky, 12 miles
north of Lexington. This city of 7,000 persons serves
a trade area with an estimated population of 20,000
persons including the Georgetown College enrollment
of 1,200 students. A very rich and fertile belt of bluegrass country that is known for top grade burley
tobacco and fine livestock runs through this part of
Kentucky. Though, tobacco is the prime money crop,
industrial activity is growing and general economic
conditions in the community are healthy, with approximately 1,500 persons employed in manufacturing concerns and 1,700 in nonmanufacturing enterprises. In
addition, approximately 20 percent of the eligible labor
force works in Lexington.




$5, 646, 609
7, 812,134
13,438,460

To be
operated

In
operation
1
2

3

In 1962 the present owners acquired control of the
charter bank by purchasing the majority of its shares.
During the fall of 1963 they also gained control of a
majority of the shares of the merging bank. A new
loan policy and other reforms instituted in the charter
bank since its purchase have resulted in a diversified
and expanded loan program and in improved bank
earnings. If the present ownership of the applicants
is allowed to take advantage of the operational and
managerial economies inherent in the elimination of
duplicated efforts, both banking services and earnings
of the resulting bank should show improvement
comparable to that of the charter bank.
Neither of the applicants has any history of acquisitions aside from the charter bank's 1963 acquisition of
the small Farmers Deposit Bank of Sadieville, Ky. It
is apparent from a study of liquidity ratios and earnings over the past few years that the financial condition of both banks has been and continues to be good.
Other than the applicants, the only financial institutions in the community are one bank, two savings and
133

loan associations, and two loan companies. The two
savings and loan associations, owned by the presidents
of the merging bank and the remaining bank respectively, are used to channel off those loans that their
banks prefer not to make. Of the two loan companies,
only one does a significant amount of business. That
loan company is controlled by the present owners of
the merging and charter banks.
Although three banks now serve Georgetown, there
is no magic inherent in the number of three for a small
community. For instance, in Frankfort, a much larger
city, the community is well served by only two banks.
Rather than pay obeisance to mere numbers, analysis
of the effect of the proposed merger should consider
the convenience and needs of the community and the
effect upon competition of eliminating one bank.
In the past, all three banks in the Georgetown area
had provided substantially similar banking services
with little or no effective competition among them.
They had merely provided alternative banking sources
for the community. Only recently, due to the aggressive loan policy of the charter bank, has the total loan
market and the corresponding market share of each
bank undergone significant change. The charter bank
now makes more than 50 percent of the greatly increased total of loans made by the Georgetown banks.
The following summaries of loan and deposit figures
for the Georgetown banks as of December 20, 1963,
are indicative of the disparate competitive efforts: The
charter bank, with total deposits of $6.02 million, had
total loans of $4.7 million; the merging bank, with
total deposits of $4.82 million, had total loans of $2.01
million; and the third bank, with total deposits of $4.06
million, had total loans of $1.97 million.
After the merger it appears that the applicants will
serve the convenience and needs of the community
more effectively than at present by providing superior
management, better facilities, and a greater lending
limit. By unifying the present staffs of each bank,
those officers experienced in one field of bank operations will complement those experienced in other fields,
thus resulting in more capable, experienced and continuous management. The resulting bank also intends
to provide new drive-in and parking facilities for which
there appears to be a great need in Georgetown. Finally, the larger lending limit of $100,000 will enable
the resulting bank to actively solicit business from those
who now transact their banking business in Lexington.
In order to guage the effect on competition in Scott
County, a comparison must be made of the competitive
situation before and after consummation of the proposed merger. It is clear that before autumn 1963
134




there were three banks which, if not engaged in active
competition with each other, at least were separate
and distinct entities. Since the purchase of the merging bank at that time, however, only technically can
it be considered a separate and distinct entity. Whatever divergence in policy existing previously that might
have resulted in competition between the applicants
has been eliminated. Consequently, no tenable allegation of premerger competition can be made. The
effect upon competition with the remaining bank depends to a large extent upon the preferences of its customers and of the public at large. It is already the
smallest of the Georgetown banks and the broader
banking services available from the applicants, if their
banks are permitted to merge, will undoubtedly disturb
the competitive structure. However, a realinement
of the competitive banking structure would be appropriate in order to provide better service to the community.
Finally, although the Supreme Court has delimited
the arena of competition for Lexington banks as only
Fayette County, such delimitation does not forever
foreclose that county to competition from outside. The
applicants intend, through the expected strength of the
resulting bank, to challenge the Lexington banks in
Fayette County, as well as in Scott County, for the
banking business of tobacco auction brokers and purchasers, large agricultural and livestock interests, and
local manufacturing firms, all of which are now dependent upon Lexington banks for their credit sources.
It may well be, therefore, that the great impact of this
merger will be felt outside Georgetown and that the
merger will have a beneficial effect upon competition
in the broader Fayette and Scott County market.
Applying the statutory criteria to the proposed
merger we conclude that it is in the public interest
and the application is therefore approved.
AUGUST 28,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The First National Bank & Trust Co. of Georgetown,
Ky., as of December 31, 1963, had reported assets of
$7,436,300. On the same date, Georgetown National
Bank of Georgetown, Ky., had reported assets of
$6,055,200. The two banks offer substantially the
same banking services in the same market area and are
in competition with each other. The only other competition in Georgetown is from one small bank, the
Farmers Bank.
Although the merging banks have recently come
under the control of the same group of stockholders,
we can find no justification for any further diminution

of existing banking competition in the area. The resuiting bank, with over 70 percent of the I PC deposits
and loans in Georgetown would clearly dominate the

local banking market. We therefore conclude that
the proposed merger would have serious adverse competitive effects.

THE IDAHO FIRST NATIONAL BANK, BOISE, IDAHO, AND POGATELLO NATIONAL BANK, POCATELLO, IDAHO
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Pocatello National Bank, Pocatello, Idaho (14859), with
and the Idaho First National Bank, Boise, Idaho (1668), which had
merged Sept. 4, 1964, under charter and title of the latter bank (1668). The
merged bank at the date of merger had

COMPTROLLER'S DECISION

On July 2, 1964, the $282.8 million Idaho First National Bank, Boise, Idaho, and the $4.9 million Pocatello National Bank, Pocatello, Idaho, applied to the
Comptroller of the Currency for permission to merge
under the charter and with the title of the former.
Boise, the State capital, has a population over 80,000
in a trade area of 230,000 dependent primarily on a diversified agricultural economy. Because it is well
served by airlines, truckingfirms,railroad facilities, and
bus lines, Boise is a distribution center for the rest of the
State. The scarcity of manufacturing industries has
not inhibited a continuing stable growth rate of about
5 percent per year.
The Idaho First National Bank is a statewide system
operating 40 branches. Its largest competitor Is the
$260.1 million First Security Bank of Idaho National
Association, which also operates offices throughout the
State.
Pocatello, located 239 miles southeast of Boise, is the
second largest city in Idaho, and has an area population in excess of 52,000. It serves as the transportation and distribution point for the southeastern portion
of the State, where several large industrial firms are
located. Agriculture is an important segment of the
local economy, which also relies upon Idaho State
University with its approximately 3,000 students.
The merging bank opened for business in 1959 as a
satellite of the charter bank, since at that time the
consent of the existing banks in Pocatello would have
been required for the opening of a de novo branch by
the charter bank. It competes with four offices of
First Security Bank of Idaho National Association, and
the $58.1 million Idaho Bank & Trust Co.




$5, 228, 838
292, 692, 820

To be
operated

2
41

297, 862, 393

43

Consummation of the proposed merger will allow
more efficient operation and will introduce trust services to the merging bank's customers. More importantly, it will provide additional resources to meet the
needs of the larger industrial and agricultural credit
users of Pocatello.
Beceause of the two banks' affiliated relationship
and due to the distances between their offices, no
elimination of competition nor trend toward monopoly is indicated. The merger merely changes the
form of relationship without affecting local bank
competition.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
SEPTEMBER 3, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Idaho First National Bank, the State's largest
with deposits of over $256 million, operates 42 banking offices throughout Idaho. Since 1953 it has acquired 10 banks with deposits of over $36 million.
The Pocatello National Bank is located in Pocatello,
about 41 miles from the nearest branch of Idaho First
National. Deposits of the Pocatello National Bank
are $4,433,000 and it has one branch office in Pocatello in addition to its main office there.
Direct competition between the participating banks
appears very limited, if it exists at all.
As of December 31, 1963, Idaho First National had
35 percent of all Idaho bank deposits and 28.8 percent
of the banking offices in the State. The 3 largest banks
in Idaho have 76.6 percent of the total deposits of all
Idaho banks and 93 of the 139 banking offices in the
State. Since 1952, these 3 banks have acquired 18

135

banks with 22 banking offices. Idaho First National
has led this movement with its 10 acquisitions since
1953. While each acquisition of a small bank, considered separately, may not necessarily result in a substantial lessening of competition, the cumulative effect of

a series of small acquisitions, of which the present is an
example, must inevitably be substantially adverse.
Thus, the proposed acquisition by Idaho First National
would probably result in an adverse competitive effect
and a tendency toward monopoly.

NATIONAL BANK & TRUST GO. AT GHARLOTTESVILLE, CHARLOTTESVILLE, VA., AND THE PEOPLES BANK OF STUARTS
DRAFT, INC., STUARTS DRAFT, VA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Peoples Bank of Stuarts Draft, Inc., Stuarts Draft, Va., with
and National Bank & Trust Go. at Gharlottesville, Charlottesville, Va.
(10618), which had
.
merged Sept. 30, 1964, under charter of the latter bank (10618) and title
"National Bank & Trust Co." The merged bank at the date of merger
had
.
.

COMPTROLLER'S DECISION

On July 15, 1964, the $55 million National Bank &
Trust Co. at Charlottesville, Charlottesville, Va., and
$2.3 million Peoples Bank of Stuarts Draft, Inc., Stuarts Draft, Va., applied to the Comptroller of the Currency for permission to merge under the charter and
with the title of the former.
Charlottesville, population 34,500, is located in
central Virginia near the Blue Ridge Mountains.
The area's industry includes a combination of agriculture and light equipment manufacturing concerns.
The University of Virginia, which employs approximately 2,100 persons and has an enrollment of 5,900
students, is located in Charlottesville. The area has
enjoyed a healthy expansion during the past 10 years.
The charter bank has 10 branches operating within
central Virginia. In this region the charter bank's
principal competition comes from the $414 million Virginia National Bank, the $452 million First Merchants National Bank and the $16 million Citizens
Bank & Trust Co. Eleven banks are located in the
Charlottesville service area.
Stuarts Draft, population 600, is a rural, residential
community in west central Virginia. Located in the
Shenandoah Valley near the Blue Ridge Mountains,
the community has had within the past 10 years a
surge of new home construction. Several local facilities of large major industries have been established
recently in the Stuarts Draft area. Since the commercial facilities of the town are limited, the bulk of shop136




To be
operated

$2, 442, 073

1

56, 357, 858

11

58, 772, 892

12

ping needs of the community are supplied by nearby
Waynesboro and Staunton establishments.
The merging bank, with no branches, is the only
financial institution in the town of Stuarts Draft. The
Peoples Bank of Stuarts Draft competes primarily with
8 banks operating 13 offices in the Stuarts DraftWaynesboro-Staunton area and is the eighth largest
of the 9 banks serving the area. The $414 million
Virginia National Bank operates 2 offices in the area.
The Stuarts Draft bank, no longer able to serve adequately a community changing from a rural to a semiindustrial economy, has chosen to merge with an area
bank which can offer an extensive range of financial
services. The credit and trust departments of the
charter bank will provide services not currently available at the merging bank. A small lending limit restricts the merging bank from actively competing to
satisfy the banking needs of the new medium-sized industrial and commercial concerns in the area which
depend on local institutions for financing.
The competitive effect of the proposed merger will
be minimal since the nearest office of the charter bank
is 35 miles away in Charlottesville and the overlap of
the charter bank's service area is relatively insignificant. In addition, the greater services to be offered by
the proposed merger will bring about a greater degree
of competition in the area of the merging bank.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest
and the application is therefore approved.
SEPTEMBER 21,1964.

SUMMARY OF

1

TORNFY GENEFAI,

The National Bank & Trust Go. at Gharlottesville
had, as of April 15,1964, assets of $54,573,000, deposits
of $48,426,000. loans and discounts of $26,308,000,
and capital accounts of $4,631,000. It operates four
offices in Gharlottesville and six offices outside of Charlottesville located from 20 to 37 miles east and south
of Charlottesville. Authorization has been granted for
one more branch in Gharlottesville.
The Peoples Bank of Stuarts Draft, Inc., had, as of
April 15, 1964, assets of $2,276,000, deposits of
$2,010,000, loans and discounts of $1,512,000, and
capital accounts of $266,000. It operates one office
in Stuarts Draft, a town 35 miles west of Charlottesville.
The service area of the banks do not appear to overlap. The application states that there is no competition between the merging banks, but there is no supporting data with respect to common depositors or

lenders or the volume of loans or deposits obtained by
either bank in the service area of the other. However,
direct competition between the banks does not appear
to be significant.
This merger will have some adverse effect upon competition in the relevant markets particularly with respect to thefivesmaller banks in Peoples Bank's service
area. Since these five smaller banks are already presently competing with Virginia National and First &
Merchants, which between them presently account for
95.88, 95.74, and 95.83 percent of total assets, loans
and deposits, respectively, the proposal would serve to
aggravate an already highly concentrated area. In
addition, the proposed merger eliminates one more independent bank in Virginia. When consideration is
given to the increasing number of other independent
banks in Virginia that have been eliminated by mergers
in recent months, the cumulative effect of supplanting
small independent banks by consolidations and mergers
renders this proposal adverse.

THE BRANFORD TRUST CO., BRANFORD, CONN., AND THE FIRST NEW HAVEN NATIONAL BANK, NEW HAVEN, CONN.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Branford Trust Co., Branford, Conn., with
and the First New Haven National Bank, New Haven Conn. (2), which had. .
merged Sept. 30, 1964, under charter and title of the latter bank (2). The
merged bank at the date of merger had

COMPTROLLER'S DECISION

On July 22, 1964, the $197.8 million First New Haven National Bank, New Haven, Conn., and the $6
million Branford Trust Co., Branford, Conn., made application to the Comptroller of the Currency for permission to merge under the charter and with the title
of the former.
New Haven is one of the industrial centers of New
England. Its diversified manufacturing is primarily
in the durable goods field, with the majority of the
companies employing fewer than 50 workers. Having
a population of approximately 152,000, the city serves
as a focal point of an area of 448,000 people. Urban
renewal has made the heart of the city one of the most
modern in the country, and new hotel, office building
and retail construction indicates that New Haven will
continue to serve as a center of trade and finance in




$5, 814, 623
197, 335, 681
203,150,304

To be
operated

1
14
15

south-central Connecticut. New Haven has traditionally been a transportation hub, as it is the headquarters
of the New Haven Railroad and the converging point
of two interstate highway systems. The general economic outlook for the future is quite promising.
The charter bank has 13 branches in New Haven
and surrounding towns. Its major competitor in New
Haven is the $115.7 million Second National Bank with
nine branches. The other local banks include the
$109.8 million Union & New Haven Trust Co., which
has eight branches; the $24.9 million Tradesmens National Bank, New Haven, with two branches in the
area; and the single-office $7.2 million General Bank
& Trust Co. Several large savings banks also operate
in New Haven. Besides the banks which compete directly with the charter bank, some of the largest banks
in Connecticut, including the $515 million Connecticut
Bank & Trust Co., Hartford, the $286 million State

137

National Bank of Connecticut, Bridgeport, and the
$223 million Connecticut National Bank, Bridgeport,
actively seeks accounts in the charter bank's area.
Branford, population 18,800, is a residential-industrial suburb of New Haven and a summer resort.
With the large percentage increase in population over
the past two decades has come a trend to the establishment of local industry. There are now 51 manufacturing establishments in Branford, with metals and
other durables composing a majority of these companies. The town's coast line on Long Island Sound has
attracted summer, and even some year-round, residential development. The general movement to suburban areas, as well as the announced intention of several industrial firms to move to Branford, bodes fair
for the development of the local economy.
The Branford Trust Co. is the sole commercial
bank in Branford. The $14.8 million Branford Savings Bank and the $14.2 million First Federal Savings
& Loan Association are the only other financial institutions in the town.
The merging bank has operated as a commercial
bank since 1911. While Branford was a small, residential community, this bank and the local savings
bank adequately served its citizens. The recent
change in character of the town has necessitated a
different role for banking there. Because of the anachronistic branch banking laws of Connecticut, however, no major bank could establish a branch in Branford while the home office of the State bank remained.
That there has been a need for modern banking
service in Branford is reflected in the fact that over
the last two decades, the population of Branford has
more than doubled and local efforts to encourage the
location of industry in the town have borne fruit. The
Branford Trust lending limit of $70,000 has been inadequate and its limited services cannot fill the needs
of the public that it purports to serve. With an elderly
executive officer who wishes to retire, the merging

bank cannot operate effectively under existing conditions. There appears to be little hope of attracting
able management to chart a new course because of the
bank's small size and its closely held stock.
The Branford Trust Co. has chosen the merger
route as the solution to its predicament. By this
proposal a broader range of facilities and services
will serve commercial and retail banking needs of the
Branford community. Its most salutary consequence,
from the public standpoint, is the opening of Branford
to meaningful competition. By severely restricting the
range of its services and functions, the merging bank
has not well met the banking needs of this growing
community, nor has it been a truly competitive force
there. The merger will open the town to branch
banking and give its residents the benefits of a fullservice banking institution.
In considering the facts of this case in light of the
relevant statutory criteria, we find this merger to be
in the public interest and the application is, therefore,
approved.
SEPTEMBER 29,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The First New Haven National Bank, the largest
bank in the relevant competitive area with more than
40 percent of commercial banking assets, deposits and
loans in New Haven and the relevant area, proposes
to acquire one of the few remaining independent commercial banks in the growing suburban and resort area
lying east of New Haven.
The merger would not appear to substantially affect
the banks located in New Haven but would eliminate
potential competition between the merging banks and
result in the substitution of a branch of the largest
bank in the area for the Branford Trust Co. and thereby place the smaller banks in North Branford and
Guilford at a serious competitive disadvantage.
We believe that the merger would have an adverse
competitive effect.

THE NATIONAL BANK OF WASHINGTON, TACOMA, WASH., AND THE SPOKANE NATIONAL BANK, SPOKANE, WASH.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Spokane National Bank, Spokane, Wash. (14866), with
and National Bank of Washington, Tacoma, Wash., (3417), which had
merged Oct. 2, 1964, under charter and title of the latter bank (3417). The
merged bank at the date of merger had

138




$6, 210, 207
247,159, 412
253, 369, 620

To be
operated

2
31
33

COMPTROLLER S DECISION

On July 27, 1964, the $236.5 million National Bank
of Washington, Tacoma, Wash., and the $5 million
Spokane National Bank, Spokane, W^ash., applied to
the Comptroller of the Currency for permission to
merge under the charter and with the title of the
former.
Tacoma, located on Puget Sound, is an industrial
city, 30 miles west of Seattle. It ranks third in size
in the State, with a population of nearly 150,000.
The economy is based primarily on lumber, manufacturing and shipping. There are also several nearby
military facilities which add some stimulation to the
economy.
The National Bank of Washington has 26 offices in
western Washington and 6 in the central part of the
State. It receives significant competition in Tacoma
from the Puget Sound National Bank which has 14
offices, and in other areas from the Peoples National
Bank of Washington, Seattle, Wash., the National
Bank of Commerce of Seattle, and the Seattle-First
National Bank, which, with 77 branches, is the largest
in the State.
The city of Spokane, population 180,000, is located
in the area known as the "Inland Empire" which lies
along the Canadian border in eastern Washington.
It is the second largest city in the State and largely
supported by agriculture and lumbering.
The merging bank, 312 miles east of Tacoma, has
resources of $6 million. Its main office is in down-

town Spokane and its one branch is 7 miles north of
the city. Competition is provided by the Old National
Bank of Washington, Spokane, Wash., and several
other large banks, including the Spokane and Eastern
branch of the Seattle-First National Bank and the
Washington Trust Bank of Spokane.
Consummation of the proposed merger will allow
greatly expanded and more efficient operations for
the resulting bank, including trust services, investment
and market research, and international banking departments. In addition, an acute management problem, which has been caused by poor health of the
Chairmen of the Board will be solved.
Because of the considerable distance between the
two banks, no elimination of competition nor trend toward monopoly is foreseeable. In fact, competition
will actually be stimulated because of the added
strength of the resulting bank.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
SEPTEMBER 29,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger would not eliminate any substantial competition between the two banks but it
would adversely affect competition by contributing to a
pronounced merger trend by which the larger Washington State banks are acquiring many viable small and
medium-sized banks.

THE MARINE NATIONAL BANK OF ERIE, ERIE, PA., AND THE CITIZENS NATIONAL BANK OF CORRY, CORRY, PA.

|
Name of bank and type of transaction

The Citizens National Bank of Corry, Corry, Pa. (4479), with
and the Marine National Bank of Erie, Erie, Pa. (870), which had
merged Oct. 2, 1964, under charter of the latter bank (870), and with the
title "Marine National Bank." The merged bank at the date of merger had.

COMPTROLLER S DECISION

On August 3, 1964, the $42.1 million Marine National Bank of Erie, Erie, Pa., and the $10.9 million
Ciitzens National Bank of Corry, Corry, Pa., applied
to the Comptroller of the Currency for permission to
merge under the charter of the former and with the
title of the Marine National Bank.




j
Total assets

$10, 963, 243
43, 002, 848
53, 966, 092

Banking offices
In
operation

To be
operated
1
5
6

Erie, with a population of over 134,000 in a metropolitan area of about 250,000, is an industrial city
located on Lake Erie in the northwestern part of the
State. Its lake port facilities can accommodate oceangoing ships carrying coal, iron, and grain. The local
economy is supported by many national manufacturing companies and is supplemented by agriculture in
the surrounding areas.
139

Located 32 miles southeast of Erie is the city of
Gorry. With a population of over 7,700 and serving
a trade area of 20,000, the city is located on the main
line of the Erie Railroad and has access to good highway connections. The local economy depends on a
number of small manufacturing industries employing
some 7,000 people.
The charter bank has experienced slow growth over
the years due to its ultraconservative management and
its late entry into branch banking. However, since
1956, it has established four de novo branches in the
Erie area. It is the third largest commercial bank
in its area and competes with the $102 million First
National Bank, the $87.2 million Security Peoples
Trust Co., the $31.1 million Union Bank & Trust Co.,
and the $12.8 million Bank of Erie, all of Erie.
The charter bank has recently retained as its president the young, aggressive former president of the
merging bank. This change of management was designed to modernize the charter bank. Now faced
with a serious management succession problem, the
merging bank desires to continue its progress under the
former president. This proven management leadership
should be continued.
There is no competition between the two institutions.
Consequently, consummation of the proposed merger
will not diminish competition. Competition from
other banks and financial institutions will continue
to offer alternate sources of adequate credit to customers in the merging bank's area and the charter
bank's position with respect to the other banks in Erie
will remain unchanged.

Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is, therefore, approved.
SEPTEMBER 30,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The Marine National Bank of Erie is the third largest
bank in Erie, Pa. The Citizens National Bank of
Corry is a small unit bank operating 30 miles from
Erie. Although there does not appear to be any
presently existing competition between these banks, it
would appear that Marine is in a position to seek loan
accounts in the area now served by Citizens. Approval
of this merger would eliminate such potential
competition.
Merger with Citizens would not appear to materially
enhance Marine's position in Erie, although it would
increase somewhat the concentration in this area. The
more serious effect of this merger, we believe, would
be felt among the small banks competing with Citizens,
particularly the National Bank of Corry, which is the
only other bank operating in the town where Citizens
is located. The National Bank of Corry and the other
small independent bank that would remain after this
merger (National Bank of Union City) would be faced
with competition from a branch of a much larger bank.
This factor, plus an increase in concentration existing
in the western portion of Erie County, may make the
continued existence of these small independents more
difficult.
For these reasons we believe that approval of this
merger will have a slight adverse effect on competition.

THE CITIZENS NATIONAL BANK & TRUST CO. OF ONEONTA, ONEONTA, N.Y., AND THIS NATIONAL COMMERCIAL
BANK & TRUST CO., ALBANY, N.Y.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Citizens National Bank & Trust Co. of Oneonta, Oneonta, N.Y. (8920),
with
and National Commercial Bank & Trust Co., Albany, N.Y. (1301), which had. .
merged Oct. 2, 1964, under charter and title of the latter bank (1301). The
merged bank at the date of merger had
COMPTROLLER'S DECISION

On July 29, 1964, the $437 million National Commercial Bank & Trust Co., Albany, N.Y., and the $13
million Citizens National Bank & Trust Co. of
Oneonta, Oneonta, N.Y., applied to the Comptroller
140




SI 3, 273, 644
455, 320, 050
468, 482, 429

To be
operated

2
39
41

of the Currency for permission to merge under the
charter and title of the former.
Albany, the site of the home office of the charter
bank and 5 of its 35 branch offices, is the capital of the
State of New York. Located at the hub of a rail, highway, and water transportation system which serves the

)tc*fe^, the city Is also a

the C*.
setts D
c! u fi
Air .in

i

)i is branches in nearby
\,i'^i er are distributed
' '<=IK i.versified area, which
i the hoi > >£i i , 'i 150 miles north to
nan borne ^ iv lev - i st to the Massachu-r WO nnl •, west J 60 miles south. The
i-k's mos1 v + ve (OToetition arises in the
\ cTtd « v h r i t r n e arc 34 offices of
n
un!

conn
throi

1

se\en
r lficiii! b alvs
Or-oii+a, pjpulrtion 13 300, is the site of the
merging bank. Located 85 miles southwest of Albany
and 20 miles south of the charter bank's nearest branch,
it is the chief trading center for Otsego County. The
county's economic base is agricultural with dairy
farming the predominant source of income.
The competition that exists between the applicant
banks is negligible. The deposits and the loans of the
charter bank's three branches in Otsego County account for only 0.6 and 0.56 percent respectively of the
charter bank's overall deposits and loans. The impact
of the merger will be greatest in Oneonta, where the
$23 million Wilber National Bank, the only other commercial bank in town, welcomes the entrance of
National Commercial as a stimulant to competition.
The resulting bank will benefit the Oneonta area
by the introduction of services not now offered to
residents and by offering the residents a choice of
sources for services now offered only by the Wilber National Bank. New services which, for the first time,
will be offered residents are certificates of deposit, accounts receivable financing, education loans, equipment leasing, investment services, and area develop* *

ment services to assist in community planning and
growth.
The overall benefits derived from the proposed
merger, couplied with the fact that competition can be
expected to increase, make it apparent that the resulting bank will improve banking services in the Oneonta
area.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
SEPTEMBER 29, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger seeks to bring together National Commercial Bank & Trust Co., one of northeastern New York's largest banks, with assets of
$436,581,000 and 38 offices in Albany and other important upstate areas, and Citizens National Bank &
Trust Co. of Oneonta, a much smaller independent
bank with two offices in Oneonta and assets of
$13,103,000. National has within the last 8 years acquired three banks within 20 miles of Citizens, the
last such acquisition taking place in January of 1964.
The proposed merger will eliminate some degree of
actual and expected future competition between the
two institutions and will add to the concentration and
elimination of independents that has already occurred
in Otsego County and the greater service area of National. Although it will offer Oneonta the advantages
of a large institution, such advantages are already
present in some measure and there v/ill be eliminated
from Otsego County a unit bank competitor that has
shown growth over the years in a static area. For
these reasons we conclude that the effects of the proposed merger on competition will be adverse.
*

THE WESTERN PENNSYLVANIA NATIONAL BANK, MCKEESPORT, PA., AND THE CITIZENS NATIONAL BANK OF
BEAVER FALLS, BEAVER FALLS, PA.
Bankin g offices
Name of bank and type of transaction

Total assets

Citizens National Bank of Beaver Falls, Beaver Falls, Pa. (14764), with.
and Western Pennsylvania National Bank, McKeesport, Pa. (2222), which

COMPTROLLER S DECISION

On June 26, 1964, the $512 million Western Pennsylvania National Bank, McKeesport, Pa., and the $6.3
million Citizens National Bank of Beaver Falls, Beaver




To be
operated

$6,107, 963
530, 002, 302

consolidated Oct. 3, 1964, under charter and title of the latter bank (2222).
The consolidated bank at the date of consolidation had

In
operation

536,110,264

:
49

Falls, Pa., applied to the Comptroller of the Currency
for permission to consolidate under the charter and
with the title of the former.
McKeesport is an industrial city of 45,000 people,
141

separated from Pittsburgh by only 2 miles. Both cities
are located within Allegheny County and their economies are based on steel production.
Beaver Falls, population 16,000, is located 33 miles
northwest of Pittsburgh in Beaver County. Its economy, like that of Pittsburgh and McKeesport, is
founded primarily upon the steel industry, as is that of
the entire industrial complex which is coterminous
with the Pittsburgh Standard Metropolitan Statistical
Area. This area includes Allegheny, Beaver, Washington, and Westmoreland Counties.
Since 1953, the Western Pennsylvania National
Bank has attained a phenomenal growth record under
dynamic executive leadership. During this period its
assets have increased from approximately $50 million
to the present $512 million. The charter bank now
offers significant competition to the Mellon National
Bank and to the Pittsburgh National Bank. To further competition, Western Pennsylvania has requested
and received permission to move its head office from
McKeesport to Pittsburgh.
There is little competition between the applicant
banks. The charter bank does not have an office in
Beaver Falls, while the Citizens' two offices are located
there. Western Pennsylvania's nearest office is in New
Brighton, which is on the opposite side of the Beaver
River some 3 miles away from the consolidating bank's
head office. Citizens, however, competes with other
commercial banks which operate seven offices in Beaver
Falls, including two offices of the Mellon National
Bank.
Beaver Falls will be benefited by this consolidation.
Citizens National has been unable to attract adequate
capital to support the size of its present operations.
It has also been unable to meet the credit needs of its
service area which is limited to the immediate vicinity
of Beaver Falls. The resulting bank will be able to
offer to the public many new specialized banking serv-

ices, including a trust department. It will likewise
offer a full range of consumer financing and installment loans which will provi.de more effective competition for the many finance companies now operating
in the area.
Applying the statutory criteria to the proposed consolidation, we conclude that it is in the public interest
and the application is therefore approved.
SEPTEMBER 28, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Commercial banking in the Pittsburgh (Allegheny
County) area, the primary service area of the Western
Pennsylvania National Bank, is very highly concentrated, to a large extent as the result of past acquisitions and mergers. Western itself is the third largest
bank serving the Pittsburgh area and has, since 1953,
acquired 20 small- and medium-sized banks, most of
them in Allegheny County. Approval of the instant
consolidation would further an existing tendency toward monopoly and will eliminate existing competition
between Western and Citizens.
As recently as February 1964, Western acquired a
bank in Citizens' service area, only 1 mile from Citizens'
nearest office. As a result of the proposed consolidation, the small local banks operating in this service
area will be confronted with four more branches of
this large Allegheny County bank in addition to the
branches of Pittsburgh's largest and fourth largest
banks already there—Mellon National Bank & Trust
Co. and the Union National Bank of Pittsburgh. This
situation may impose such a handicap on the remaining
small banks that they will be forced to seek similar
consolidations thereby eliminating all local banks in the
area.
In all respects, therefore, the effect of this proposed
consolidation upon competition must be deemed to
be adverse.

MARINE MIDLAND NATIONAL BANK OF SOUTHEASTERN NEW YORK, POUGHKEEPSIE, N.Y.,
NATIONAL BANK, LIBERTY, N.Y.

AND COMMUNITY

Banking offices
Name of bank and type of transaction

Total assets

To be
operated

In
operation
Community National Bank, Liberty, N.Y. (10037), with
and Marine Midland National Bank of Southeastern New York, Poughkeepsie, N.Y. (465), which had
merged Oct. 9, 1964, under charter and title of the latter bank (465). The
merged bank at the date of merger had

142




$26, 034, 886

3

104, 687, 940

6

130,740,826

9

COMPTROLLER'S DECISION

On May 28, 1964, the $95.5 million Marine Midland National Bank of Southeastern New York, Poughkeepsie, N.Y., and the $23.4 million Community National Bank, Liberty, N.Y., applied to the Comptroller
of the Currency for permission to merge under the
charter and with the title of the former.
Poughkeepsie, county seat and principal city of
Dutchess County, is located about 78 miles north of
New York City and has a population of over 38,000
in a trade area of about 250,000. The economy of
Dutchess County depends on light manufacturing, related service industries, some heavy manufacturing and
considerable dairy farming and fruit growing.
The Marine Midland National Bank maintains its
main office and one branch in Poughkeepsie and four
other brandies located outside of the city. Its chief
competitors are the $139.7 million Poughkeepsie Savings Bank, the $27.3 million Farmers-Mattewan National Bank, the $26.3 million Dutchess Bank & Trust
Co., and the $17.2 million Fallkill National Bank &
Trust Co. Moreover, the charter bank, as a member
of the Marine Midland group, enjoys the services and
connections of a large statewide bank holding
company.
Liberty, with a population of 4,700 in a trading area
of 16,000, is located in Sullivan County 56 miles west
of Poughkeepsie and 108 miles northeast of New York
City. It shares in the Catskill Mountain resort economy which attracts over 2 million visitors a year to the
area. Existing resort facilities include about 300 hotels,
many of which can accommodate over 500 guests, some
1,200 bungalow colonies averaging 8 units, about 50
motels, and 100 trailer courts. In addition, rental cottages, campsites and other lodgings abound in the area.
In recent years, there has been an increase in the development of winter sports to encourage year-round
activity in the region. This project has encouraged
further expansion of existing facilities.
The merging bank, quartered in Liberty with branch
offices in South Fallsburg and Woodbourne, ranks
second among eight commercial banks in Sullivan
County. Its deposit structure fluctuates considerably
because of the seasonal nature of the resort business,
with the result that it does not possess the deposit stability nor the legal lending limit which would permit
substantial financing of resort and agricultural enterprises on a long-term basis.
Consummation of the proposed merger will introduce into Sullivan County a bank with deposit stability
and a lending limit sufficient to meet the credit needs




of an expanding resort industry. Further, the customers of the merging bank will have available for
the first time trust and other banking services not
offered by the merging institution. The pool of
trained employees of the charter bank and the Marine
Midland system will benefit the merging bank and
improve its operating efficiency.
While the banking structure of Poughkeepsie will
not be altered by the merger, the competitive climate
of Sullivan County will be considerably improved by
the introduction of a strong, full-service institution.
Since the applicants are over 50 miles apart and do
not compete with each other, no reduction of competition or trend toward monopoly is foreseeable.
The residents of Dutchess and Sullivan Counties will
continue to have available adequate competing
sources of bank services and credit.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is therefore approved.
OCTOBER 5,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Community National is one of eight commercial
banks in Sullivan County, N.Y., and claims that it
competes with three additional banks, two located
in Ulster County and one in Orange County. Community National ranks third among all 11 banks, with
11.9 percent of total deposits. The three largest account for 60.3 percent of the total deposits. If the
merger is effectuated, the resulting bank, Marine Midland of Southeastern New York (based in Poughkeepsie, Dutchess County, 56 miles from Liberty and
with no existing branch in Sullivan County) would
have 40.8 percent of the deposit total of all 11 competing banks, and the 3 largest banks would have 73.3
percent of the deposit total. A merger trend has
already occurred among the Sullivan County banks,
three banks having disappeared through merger in
the past 4 years, and an application is pending to
merge a fourth (apart from the instant application).
The proposed merger would substitute the multibillion Marine Midland banking organization in Sullivan County in place of the present independently
owned and operated Community National Bank.
The resulting bank will have a far greater lending
limit and far greater resources than any bank in the
county and surrounding area. Competition for Community National's loan participations and correspondent relationships will diminish or be foreclosed since
the resulting bank will probably deal with its sister
banks in the Marine Midland group.
143

The merger will cause an imbalance in the structure
of commercial banking in Sullivan County, may
diminish the competitive prospects of the other banks
in the area, and may increase the trend of mergers
and undue concentration and monopoly of banking
in Sullivan County.
Apart from the merger's adverse effects on competition in commercial banking in Sullivan County, it
could have adverse competitive effects on the banking
industry elsewhere in New York State. The concentration of banking resources and offices under the

single control of one organization, the Marine Midland
holding company, will be increased. The unique and
competitively favorable posture of Marine Midland as
the only statewide banking organization in the State
will be strengthened by its entrance into Sullivan
County via this merger. This may increase the pressure for the formation of other comparable bank holding companies in New York.
We conclude, therefore, that the competitive effect
of this merger may be substantially adverse.

THE TENNESSEE BANK & TRUST CO., HOUSTON, TEX., AND THE HOUSTON NATIONAL BANK, HOUSTON, TEX.
Banking offices
Total assets

Name of bank and type of transaction

In
operation

Tennessee Bank & Trust Co., Houston, Tex., with
and Houston National Bank, Houston, Tex. (9353), which had
merged Oct. 16, 1964, under charter and title of the latter bank (9353). The
merged bank at the date of merger had

COMPTROLLER'S DECISION

On September 8, 1964, the $44.6 million Tennessee
Bank & Trust Co., Houston, Tex., and the $86 million
Houston National Bank, Houston,, Tex., applied to the
Comptroller of the Currency for permission to merge
under the charter and title of the latter.
Houston, whose 1964 estimated population of over
1 million represents increases of 70.3 percent over 1950
and 57.4 percent over 1960, is the sixth largest city in
the United States and is the largest in the Southwestern
States of Texas, Oklahoma, New Mexico, and Arizona.
Its standard metropolitan area is defined as Harris
County, an area of 1,730 square miles with a population of 1.3 million. Houston is the center of what is
known as the Upper Texas Gulf Coast area, which
consists of 11 counties whose 1960 population was almost 2 million. This trade area runs approximately
21 miles north, 57 miles south, 100 miles east, and 86
miles west of Houston.
Since 1950, the Upper Texas Gulf Coast area has
nearly doubled its population, and has undergone a
significant change in its economy which 10 years ago
was primarily agricultural. Today, this region boasts
the largest concentration of oil, gas and petrochemical
refining, processing and manufacturing plants in the
world, and is one of the fastest growing industrial areas
of the Nation. It is served by six deep water ports
144




$52, 341, 796
89, 292, 080
140, 745, 393

To be
operated
1
1
1

which are connected by the Inter-Coastal Waterways.
The largest of the six is the port of Houston, connected
to the Gulf of Mexico by a 50-mile ship channel. In
1950 the port of Houston moved 41.9 million net tons;
in 1962 that figure reached 57.8 million, thus making
the port the third largest port in the country in terms
of tonnage moved.
Three hundred national firms have offices or outlets
in downtown Houston, and within the city's corporate
limits are 115 firms which employ more than 300 people each. Twenty-five of them employ more than
1,000 persons. Along with its population boom, retail sales in the city have increased by 50 percent to a
total of $1.5 billion in 1962. Adding to the already
booming economy is the 2-year old National Aeronautics and Space Administration's Manned Spacecraft
Center, located 22 miles from Houston. Ten colleges
in the area have a student enrollment of 23,669, the
largest being the University of Houston, with 13,665
students.
Metropolitan Houston is currently served by 79
banks, with several others approved but not yet open
for business. Thirteen of these banks are located in
the downtown business district of Houston, 44 banks
are located in the suburbs, arid 22 banks are located in
Harris County, outside of Houston. These commercial banks hold approximately 3 billion deposits and
1.7 billion in loans. The First City National Bank is

the largest with total resources of $903 million with
26.2 percent of deposits and 22.5 percent loans, followed by the $812 million Texas National Bank of
Commerce with 22.9 percent of deposits and 22.3 percent of loans and the $541 million Bank of Southwest,
National Association, with 14.6 percent of deposits and
17.1 percent of loans. In fourth place is the Charter
Bank with total resources of $86 million. With the
approval of this merger the Charter Bank's assets will
be $130 million and will account for 3.75 percent of
the total deposits and 3.79 percent of the total loans
in the metropolitan area. Though remaining in fourth
position, the resulting bank will be but one-fourth the
size of the third largest bank.
There, are 20 savings and loan associations in Houston operating a total of 15 branches in addition to their
main offices. Also competing in the area are over 200
credit unions, 200 life insurance companies, and 75
sales finance companies.
The resulting bank will offer more effective competition to the 3 larger banks and the effect on the other
74 smaller banks will not be adverse. Although a
minimal degree of competition will be eliminated between the merging banks, it is not considered significant. We are fortified in this view by the advisory
opinions of the Federal Reserve Board and the Federal
Deposit Insurance Corporation. In its advisory report
on the competitive factors the Federal Reserve Board
stated:
During a field investigation, officials of all the larger downtown banks and three Independent suburban banks indicated
that the instant proposal would not have an adverse effect
on the competitive picture in Houston.

While consummation of a merger between Houston National Bank and Tennessee Bank & Trust Co. would eliminate
some existing competition and potential for more competition
between the two banks, it might stimulate competition among
the larger banks without unfavorable competitive effects on
smaller banks. Numerous alternative banking facilities would
remain available in the Houston area, and the overall effect
of the proposed transaction on competition would not be significantly adverse.

In the same vein the Federal Deposit Insurance
Corporation found:
Under the proposal, a small unit bank would be eliminated
and there might be some elimination of competition. However, competition between the merging banks which might be
eliminated is not regarded as significant. Common deposits
and loans are minimal and the functions of the merging banks
have been more complementary than competitive. In addition, neither merging hank is a significant factor in the overall
competitive area by virtue of size alone.




Neither the increased concentration of banking resources
nor the competition which might be eliminated is sufficient to
be of adverse significance and it is concluded that the overall
effect of the proposed merger on competition would not be
unfavorable.

Furthermore, no evidence appears in the record indicating that the enhanced competitive capacity of the
resulting bank will work adversely upon any competing
bank in Harris County.
The stringent antibranch banking statute is another
cogent argument in support of this merger. By maintaining the strict prohibition against branch banking,
the Texas Legislature has chosen to ignore the ascending economic fortunes of a growing industrial society
in Texas. Approval of the merger will recognize the
need to marshall capital sufficient to meet the credit
requirements of the State's economic growth, and offset
in part the economic waste resulting from the proliferation of numerous unit banks, each with its own capital
structure, premises and personnel. The State's persistence in maintaining a unit banking system designed
for a rural economy of 50 years ago impedes its ability
to realize its economic potential and fulfill the destiny
for which it is striving.
Applying the relevant statutory criteria to the proposal to merge, we conclude that it is in the public
interest and the application is therefore approved,
effective at the close of business, Friday, October 16,
1964, Houston time.
OCTOBER 15,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Houston National is the fourth largest commercial
bank and trust company in Houston, with assets of
$86,081,000, deposits of $74,725,000, and loans of
$42,535,000. Tennessee Bank (which is controlled
by Tennessee Gas Transmission Co., one of the largest
public utility companies in the Nation) is the tenth
largest bank in Houston, with assets of $44,615,000,
deposits of $38,623,000, and loans of $22,512,000.
Both applicants offer trust services, and both have extensive correspondent bank activities. Each has its
office in downtown Houston (under Texas law commercial banks are not permitted branch offices). Until
April 1963 Tennessee Bank was located at 306 Main
Street, just one block south of Houston National's office
at 202 Main Street.
Metropolitan Houston is coterminous with Harris
County. There are 79 banks in this area, of which
at least 22 are reported to be closely associated with
one of the three largest, downtown banks. These
three institutions and their associated banks together
145

hold about 72.5 percent of the area's deposits. This
heavy concentration is in large part the direct result of
three major consolidations since 1953 which combined
Houston's then six largest, downtown banks into the
three which now dominate the area. Houston National, with 2.4 percent of Harris County's deposits,
is the next largest downtown bank. Tennessee Bank,
since its affiliation with Tennessee Gas Transmission
Co. in 1961, has increased its deposits from $2,289,000
to $38,623,000, and now holds 1.6 percent of the county
total.
The proposed merger would eliminate direct competition in commercial banking and trust business, in-

cluding correspondent banking services, between two
substantial downtown Houston banks. It would result in a relatively slight percentage increase in concentration in the four largest Houston banks, from
about 74.9 percent to about 76.3 percent, but in view
of the concentration which already characterizes the
market that increase is not insignificant. Moreover,
the resulting bank would possess such competitive advantages as might result from being affiliated with one
of the largest public-utility companies in the United
States as to raise serious competitive problems.
We conclude that the effect of the proposed merger
on competition would be seriously adverse.

THE ONEIDA NATIONAL BANK & TRUST CO. OF CENTRAL NEW YORK, UTIGA, N.Y., AND THE CITIZENS NATIONAL
BANK OF POLAND, POLAND, N.Y.
Banking offices
Name of bank and type of transaction

Total assets

The Citizens National Bank of Poland, Poland, N.Y. (9804), with
and the Oneida National Bank & Trust Co. of Central New York, Utica,
N.Y. (1392), which had
merged Oct. 16, 1964, under charter and title of the latter bank (1392). The
merged bank at the date of merger had
COMPTROLLER S DECISION

On August 10, 1964, the $163.5 million Oneida National Bank & Trust Co. of Central New York, Utica,
N.Y., and the $2.6 million Citizens National Bank of
Poland, Poland, N.Y., applied to the Comptroller of
the Currency for permission to merge under the charter and with the title of the former.
Utica, a city of 100,000 with a 2-county trade area
of about 250,000, is an industrial and commercial
center in central New York State, located about 50
miles east of Syracuse and 90 miles northwest of Albany. The economy of the area is dependent on industry and agriculture, and several nationally prominent industrial firms provide a substantial portion of
the area's income. The New York Thruway and the
New York Central Railroad move goods and traffic
through the region with ever-increasing volume. Although recent reductions in defense contract spending
have caused some local unemployment, expansion of
other industry is expected to counteract this situation.
Poland, a residential suburb located about 15 miles
northeast of Utica, has a population of 575. Its economic growth has been moderate but steady in recent
years. The main industry is lumber manufacturing,
146




To be
operated

In
operation

$2, 865, 897

1

167,647,231

15

170, 513,128

16

and in the immediately surrounding area, agriculture
and dairy farming.
The charter bank has nine branches in Oneida
County and five branches in Herkimer County.
There are nine commercial banks, three savings banks,
and six savings and loan associations in the OneidaHerkimer trade area operating 47 offices. The charter bank holds 23.2 percent of total deposits in the
area, while its largest commercial bank competitors,
the $155.8 million Marine Midland Trust Co. of the
Mohawk Valley, and the $171.1 million Savings Bank
of Utica, both headquartered in Utica, hold 22 and
25.1 percent, respectively.
The merging bank, possessing about 0.4 percent of
area deposits, experienced all of its increase in deposits
in recent years in the category of time deposits and
public funds, whereas demand deposits have trended
downward. Its sole office represents the only banking facility in Poland. Its closest competitor is a
branch of Marine Midland Trust Co. located 8 miles
east of Poland, in Middleville.
The inability of the merging bank to offer either
sufficient credit, or a full range of banking services has
forced many customers to go to the branch of the Marine Midland Trust Co., in Middleville. Consum-

mation of the proposed merger will bring to the merging bank's service area trust services, farm credit specialists skilled in agricultural financing, a larger line
of credit, and other advantages of full-service banking
not presently available to the merging bank's customers
and required for area growth. The merger will have
no effect on the banking industry in Utica, nor will it
eliminate any competition between the merging institutions.
In light of the statutory criteria, we conclude that the
proposed merger is in the public interest, and the application is, therefore, approved.
OCTOBER 14, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger between Oneida and Citizens
would have an adverse effect upon competition in
Oneida and Herkimer Counties as well as the smaller
area within and around Poland, N.Y. Of the eight
banks competing in the two-county area, Oneida presently holds 42 percent of the assets, 43 percent of the
total deposits and 43 percent of the loans. It is the
largest bank competing in this area. Very close to
Oneida in size is the Marine Midland Trust Co. of the
Mohawk Valley which holds 41 percent of the assets,

42 percent of the loans and 40 percent of the deposits.
Combining these two institutions they hold 83 percent
of the assets, 83 percent of the deposits, and 85 percent
of the loans. Moreover they control 28 of the 34
banking offices in the two-county area—82 percent.
This two-county area has a sound economic base supported by heavy industry and agriculture, among other
industries.
In Citizens' service area of Poland-Cold Brook-Newport, Citizens is the only bank. The nearest bank is a
branch of Marine Midland Trust Co., located 8 miles
east. The proposed merger would result in the two
largest banks in the two-county area becoming the sole
source of commercial banking services in and around
Citizens' service area.
Moreover, this proposed merger represents a further
attempt by Oneida to grow through the acquisition of
other banks and a further step by the urban banks in
these two counties to acquire the rural banks. Considering the size of the remaining competition in these two
counties, failure to stop this present merger trend may
result in the present two largest banks in the two-county
area becoming the only banks therein.
The proposed merger would have an adverse effect
upon competition.

THE FIRST NATIONAL BANK AT MOUNDSVILLE, MOUNDSVILLE, W. VA., AND MARSHALL COUNTY BANK, MOUNDSVILLE, W. VA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Marshal] County Bank. Moundsville, W. Va., with
and First National Bank at Moundsville, Moundsville, W. Va. (14142). which
had
'.
merged Oct. 17, 1964. under charter and title of the latter bank (14142). The
merged bank at the date of merger had

COMPTROLLERS DECISION

On July 31, 1964, the $5.3 million, First National
Bank at Moundsville, Moundsville, W. Va., and the
$2.6 million Marshall County Bank, Moundsville, W.
Va., applied to the Comptroller of the Currency for
permission to merge under the charter and with the
title of the former.
Moundsville, with a population of over 15,000 in a
service area of about 23,000, is located on the Ohio
River, south of Wheeling, in the northern panhandle
of the State. The service area of the two banks depends on a mixed economy of industry and agriculture.




To be
operated

$2, 512, 703

1

5, 946, 175

1

8, 556, 138

1

Population and economic growth in recent years have
been rather static. Although the area is threatened
with the possible loss of a major employer, its economy
may receive some stimulus through increased activity
of several nearby chemical plants, by expansion of the
mining industry, and by enlargement of existing
industry.
The charter bank was organized in 1901. During
the past 10 years it has not acquired any other bank.
Other commercial banks operating in the charter
bank's service area are the $7.8 million Mercantile
Bank & Trust Co. and the $3.7 million Bank of
McMechen.
147

The merging bank was organized in 1881 and has
experienced a slow rate of growth. Its president is
now ill, and since there is no qualified successor to take
the president's place, a management succession problem is present. Although the bank's owners have been
seeking to sell their controlling interest for many years,
the earnings have not been sufficient to attract
purchasers.
Since it is evident that the Moundsville area cannot
support four banks in a prosperous condition, elimination of one institution will produce a healthier climate
for the remaining banks. The resulting bank, able
to achieve some reduction in operating expenses by
consolidating bookkeeping facilities and by more efficient use of personnel, will be in a position to provide
better banking service to the public. Upon completion of the merger, the resulting bank will seek to offer
trust services for the first time.
Although the two banks are located across the road
from each other, consummation of the proposal can
hardly be expected to eliminate any meaningful competition because of the long standing noncompetitive

relationship between them. The resulting bank will
be comparable to the largest bank in the area, the
Merchantile Bank & Trust Co. Moreover, the prohibition of State law against branch banking impedes
competition by preserving for each bank an exclusive
sphere of operation unchallenged by any other bank.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
SEPTEMBER 29, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Four unit banks presently compete in the Moundsville-Glendale (West Virginia) service area which is
common to both participating banks. The proposed
merger would eliminate presently existing competition
between the participating banks. It will also concentrate in the three unit banks remaining after the merger commercial banking service for an area with a
population of 23,000. It would appear therefore that
the merger will have an adverse effect on competition
in the relevant service area.

FIRST SECURITY BANK OF IDAHO, N.A., AND THE FIRST SECURITY BANK OF TWIN FALLS, TWIN FALLS, IDAHO
Banking offices
Name of bank and type of transaction

Total assets
In
operation

First Security Bank of Twin Falls, Twin Falls, Idaho, with
and First Security Bank of Idaho, National Association, Boise, Idaho (14444).
which had
merged Oct. 23, 1964, under charter and title of the latter bank (14444).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On August 24, 1964, the $263 million First Security
Bank of Idaho, N.A., and the $3.6 million First Security Bank of Twin Falls applied to the Comptroller of
the Currency for permission to merge under the charter and title of the former.
Boise, capital of Idaho and home of the charter
bank, lies in the southwestern section of the State
approximately 450 miles southeast of Portland, Oreg.
The city has a population of about 60,000 persons
and is the center of a metropolitan trade area containing 230,000 persons. Although relatively little
industry has located in Boise, the city serves Idaho as
the focal point for numerous airlines, trucking firms,
and railroads so that it has been able to draw on
surrounding areas of Idaho for its economic support.
148




To be
operated

$3, 865, 08S

1

264, 478, 563

42

268, 343, 651

43

While Idaho emphasizes agriculture and related activities such as the production of livestock, it has, in
common with its neighbor States, an abundance of
natural resources that augments its diversified agricultural economy.
Twin Falls, home of the merging bank, is located
135 miles southeast of Boise. It has a population of
21,000 persons and serves a trade area of nearly
45,000 persons living in the south central section of
the State. As in the rest of the State, agriculture and
related activities comprise the main economic pursuit in the area and, in addition, a number of food
processing plants provide employment. The livelihood of about one-fourth of the population is based
on either the production or processing phases of such
agricultural activities.

Both the charter and merging banks are controlled
by the First Security Corp. of Utah, an interstate bank
holding company with extensive interests in the Rocky
Mountain area. The charter bank had attempted to
branch into Twin Falls in the late 1950's, but the
banks already operating there took advantage, of the
anticompetitive Idaho "consent" law, since repealed,
to deny it access. In order to have a presence in the
city, the interests behind the charter bank arranged
the organization of the merging bank in 1959. Under
State law, however, the merging bank was forced to
wait 5 years before participating in any merger. In
the interim the two banks have worked very closely,
with the charter bank handling the vast majority of
business unable to be carried by the merging bank,
so that in effect the applicants have functioned as
affiliates and do not compete with each other.
The charter bank is a statewide system operating
42 branches. Its largest competitors are the $283
million Idaho First National Bank, which operates
40 branches throughout the State, and the $90 million
Bank of Idaho, which also operates branches throughout the State.
The merging bank, which has only 10 percent of
the community's total loans and 7.5 percent of its
total deposits, is by far the smallest of the three in
Twin Falls. The other two banks are nearly equal
in size, one being a $20 million institution and the
other a $24 million institution. Nonbank financial
institutions are also active in Twin Falls, with savings
and loan associations, insurance companies, credit
unions, and various Federal lending agencies located
there.
In attempting to meet the needs of the community,
the merging bank has concentrated on supplying
credit, since its small size prohibits it from offering
such other important items as a trust department or
automated customer services. While it has found a
strong desire in the area for credit in the categories of
farmer loans, real estate loans, and consumer loans
that has not been met by the other two banks, it has
been unable to attract a sufficient amount of deposits
to enable it to meet this demand and expand its
activities further. As a result of the failure to attract
more deposits, the merging bank has had to sell a
substantial dollar amount of commercial and real estate
loans. The loan demand on the merging bank, however, is indicative that residents of Twin Falls recognize that it is attempting to serve the community
better than its competitors. Taking into account the
close relation between the applicants, there is little
doubt that the policies of the merging bank will be




continued and that the charter bank's resources will
enable it to meet more adequately all the demands
made on it. Additionally, the charter bank will offer
many services new to the community such as an active
trust department and automation of its accounts.
Consummation of the proposed merger will have a
minimal effect on the Idaho banking structure since
the charter bank will gain little more than 1 percent
in assets and only one new branch. Only in Twin Falls
will the banking structure be altered significantly and
there the change will benefit the community. While
one small bank will be eliminated, a branch of a bank
more suited to offering services needed by the 45,000
persons living in the area will replace it. At the same
time, the remaining two banks have lending limits
sufficiently large to meet the credit needs of the community without strain and they are so well-established
that they may anticipate little, if any, shifting of accounts to the charter bank. Twin Falls is an expanding community, however, and needs the full banking
services as well as the stimulus for competition that can
be expected from the charter bank.
Applying the statutory criteria to this application,
we conclude that it is in the public interest and the
application is, therefore, approved.
OCTOBER 19,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

Security Bank, Idaho's second largest with deposits
of over $235 million, operates 42 banking offices, 7 of
which have been acquired since 1952 with deposits of
over $27 million. In addition, it has two branches
approved but not yet opened and its application to
purchase the Farmers Bank, Kendrick, Idaho, was
approved by the Comptroller of the Currency on
August 19, 1964.
Twin Falls Bank is located in Twin Falls, about 14
miles distant from the closest branch of Security Bank.
Deposits of Twin Falls Bank total $3.2 million.
There is a small amount of direct competition between the participating banks. However, the chief
competition of Twin Falls Bank is from Fidelity National Bank and Twin Falls Bank & Trust Co. which
will hereafter compete with the second largest bank in
Idaho, the total deposits of which exceed by more than
10 times the total deposits held by either of them.
Security Bank has 31.5 percent of all Idaho bank
deposits and 29 percent of the banking offices in the
State. The 3 largest banks in Idaho have 76.6 percent
of the total deposits of all Idaho banks and 93 of the
139 banking offices in the State. Since 1952, these 3
banks have acquired 18 banks with 22 banking offices.
149

While each acquisition of a small bank, considered
separately, may not necessarily result in a substantial
lessening of competition, the cumulative effect of a
series of small acquisitions, of which the present is an

example, must inevitably be substantially adverse.
Thus, any further acquisition by Security Bank involves
an adverse competitive effect and a tendency toward
monopoly.

THE FIDELITY NATIONAL BANK, LYNCHBURG, VA., AND THE BANK OF APPOMATTOX, APPOMATTOX, VA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Bank of Appomattox, Appomattox, Va., with
and the Fidelity National Bank, Lynchburg, Va. (1522), which had
merged Oct. 24, 1964, under charter and title of the latter bank (1522). The
merged bank at the date of merger had
COMPTROLLER S DECISION

On August 5,1964, the $75 million Fidelity National
Bank, Lynchburg, Va., and the $3.8 million Bank of
Appomattox, Appomattox, Va., applied to the Comptroller of the Currency for permission to merge under
the charter and with the title of the former.
Lynchburg, with a population of about 58,000, is the
central city in a 4-county area of 150,000, and is situated in the Piedmont region of west central Virginia.
Located in the metropolitan area of Lynchburg are
branches of several national manufacturing and research organizations. In addition, the local economy
is supplemented by a mixture of light manufacturing concerns and agriculture. A number of institutions of higher learning also play a role in the Lynchburg area economy.
The charter bank has 12 branches operating within
the Piedmont region. Among the bank's competitors
are the First & Merchants National Bank, the largest
statewide bank; the National Trust & Savings Bank,
affiliated with the United Virginia Bankshares, a statewide bank holding company; and two branches of the
First National Exchange Bank of Virginia, which is
active throughout southwest Virginia. There are, in
all, eight banks located in the Lynchburg service area.
Appomattox, population 1,184, is an agricultural
community located 22 miles east of Lynchburg. The
community has had a negligible population increase
during the past decade. Its unemployment rate is 1
percent higher than the State average, while median
family income is about $1,500 below the State average.
The industry in the community consists solely of children's apparel manufacturing and a pipeline pumping
station.
150




$3, 948, 099
78,109, 431

To be
operated

2
13

81, 778, 300

15

The merging bank, with one branch, is smaller than
its chief competitor in the community, the Farmers
National Bank of Appomattox. Situated in the merging bank's service area is the Pamplin branch of the
First National Bank of Farmville.
A variety of problems plague the merging bank,
including management succession, declining earnings
and limited financial ability to offer full banking services to its customers. Its inability to compete effectively
in the Appomattox area makes the continued existence
of the bank as an independent entity economically
unfeasible. The credit and trust departments of the
charter bank will make available to customers in Appomattox services not currently offered by either of the
local banks. The merger will provide an additional
base of operations for the charter bank and will permit
it to aid in the stabilization and growth of the Appomattox area's agricultural economy.
Because the service areas of the two banks do not
overlap, consummation of the proposed merger will
neither diminish competition nor serve to promote
banking monopoly in the area. On the contrary, competition with the larger statewide banking institutions
will be enhanced through the availability of new services and larger lines of credit.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and
the application is therefore approved.
OCTOBER 20, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Fidelity National Bank, Lynchburg, Va., had,
as of June 30, 1964, assets of $75,165,000, deposits of
$67,321,000, loans and discounts of $53,123,000, and
capital accounts of $5,364,000. Its principal office is

located in Lynchburg, Va., and it has 12 branch offices.
The Bank of Appomattox, Appomattox, Va., had, as
of June 30, 1964, assets of $3,820,000, deposits of
$3,374,000, loans and discounts of $2,125,000, and capital accounts of $324,000. Its main office is located in
Appomattox, Va., 22.7 miles east of the main office
of the Fidelity National Bank. It operates one branch
office in Appomattox.
The application states that neither bank "considers"
the other to be a "direct competitor to any significant
degree." The application does not, however, present
any supporting data with respect to the volume of deposits or loans obtained by either bank in the service

area of the other. The application does concede "some
overlap in the service areas" and it appears that there
may be substantial competition between the banks
which would be eliminated if the merger were consummated.
The proposed merger would materially increase concentration in commercial banking in the area serviced
by the Merging Bank and would have an adverse effect upon competition in the service area of the resulting bank. Further, the proposed merger eliminates
one more independent bank, and the cumulative effect of supplanting small independent banks by consolidations and mergers renders this proposal adverse.

THE LANCASTER COUNTY FARMERS NATIONAL BANK, LANCASTER, PA., AND THE CHRISTIANA NATIONAL BANK,
CHRISTIANA, PA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Christiana National Bank, Christiana, Pa. (7078), with
and Lancaster County Farmers National Bank, Lancaster, Pa. (683), which
had
merged Oct. 27, 1964, under charter and title of the latter bank (683). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On July 28, 1964, the $94.7 million Lancaster
County Farmers National Bank, Lancaster, Pa., and
the $2.5 million Christiana National Bank, Christiana,
Pa., applied to the Comptroller of the Currency for
permission to merge under the charter and with the
title of the former.
Lancaster, seat of Lancaster County, has a population of about 62,000 in a county with a population of
about 278,000. It is an industrially diversified city
located in the southeastern part of the State. Numerous nationally known manufacturing companies contribute substantially to the local economy, which is
supplemented by prosperous farming throughout the
county. Although economic growth in this section
has not been rapid, the area enjoys a high level of
employment. The city's future appears promising
with the development of new industrial parks and the
rehabilitation of the downtown area through urban
renewal.
Christiana is a small farming community of about
1,100 located about 20 miles east of Lancaster. The
community serves the surrounding agricultural areas




$2, 636, 838

1

95, 940, 893

To be
operated

11

98, 577, 731

12

but depends primarily on employment in Lancaster
for economic support.
The charter bank, largest bank in Lancaster County,
operates 11 offices located throughout the county. It
is a full-service bank under the direction of aggressive,
competent management. Its competitors are the $72.1
million Fulton National Bank of Lancaster operating
6 branches, the $46.5 million Conestoga National
Bank of Lancaster operating 2 branches, and about 22
other commercial banks scattered throughout the
county. The single-office merging bank is the only
bank in Christiana and the smallest bank in Lancaster
County.
Consummation of the proposed merger will allow
expanded and more efficient banking services in the
merging bank's service area, including trust services,
installment credit, and the services of agricultural specialists. In addition, the acute management problem
occasioned by the retirement of the merging bank's
cashier will be met through the charter bank's pool of
young and well-trained personnel.
Because of the distance between the applicant
banks, there is little competition between them. The
151

merger will not affect the competitive banking structure in Lancaster nor adversely affect other banks active in and around the merging bank's service area.
Accordingly, the effect of the merger on competition
will not be adverse.
Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the application is, therefore, approved.
OCTOBER 23, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger of Lancaster County Farmers
National Bank (LGFNB) and The Christiana National Bank will provide another outlying branch for
the largest bank in Lancaster County. This merger
will increase the already high degree of concentration
in and around the city of Lancaster, where the two
largest banks have about 55 percent of the banking
assets, the three largest about 73 percent, and the four
largest about 80 percent.
LCFNB was formed in 1963 by the merger of what

were, at that time, Lancaster's second and fourth largest banks. Prior mergers had provided several other
branches for LCFNB's predecessor. Fulton National
Bank of Lancaster, the second largest bank, has also
grown significantly by mergers and acquisitions within
the past decade. We reported with respect to Fulton
Bank's most recent merger in 1963 that it appeared
obvious that it was "engaged in a program to achieve a
countywide system of branches through the acquisition
of outlying banks" and that "unless checked, this trend
begun by Fulton will shortly induce the other Lancaster banks to attempt similar moves to acquire outlying
unit banks in the county . . ." The merger which
produced LCFNB followed shortly thereafter.
This proposed merger between LCFNB and Christiana Bank is one more step in this trend to concentration in banking in the Lancaster area. If the trend
continues, the existence of independent unit banking in
this area is clearly endangered. Accordingly, we conclude that the proposed merger will have serious
adverse effects on competition.

CALHOUN STATE BANK, HOMER, MICH., AND CITY BANK & TRUST CO., NATIONAL ASSOCIATION, JACKSON, MICH.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

Calhoun State Bank, Homer, Mich., with
and City Bank & Trust Co., National Association, Jackson, Mich. (15367),
which had
consolidated Nov. 5, 1964, under charter and title of the latter bank (15367).
The consolidated bank at the date of consolidation had

COMPTROLLER S DECISION

On August 31, 1964, the $100.9 million City Bank &
Trust Co., National Association, Jackson, Mich., and
the $3.7 million Calhoun State Bank, Homer, Mich.,
applied to the Comptroller of the Currency to consolidate under the charter and with the title of the
former.
Jackson, with an urban population slightly in excess
of 50,000 and an area population of 125,000, is located
75 miles west of Detroit in south central Michigan.
Situated in the so-called "Industrial Corridor" between
Detroit and Chicago, the city is served by the Michigan
Central Division of the New York Central Railroad
and is located at the intersection of two principal highways. Although it is a terminal and distribution
center, Jackson is primarily an industrial city. Sup152




To be
operated

$3, 944,140

1

100, 000, 237

8

103, 944, 377

9

pliers for the automobile industry find the proximity
to Detroit a natural advantage for their plant sites,
with the result that several major tire, transmission,
iron, and other related industries provide strong support for the Jackson economy and the economy of
nearby Albion, site of a branch of the charter bank.
Until very recent years, the automobile industry has
been considered cyclical and to counter the ups and
downs inherent in such an industry, other types of
manufacturing have been encouraged. Makers of
electronics, appliances, air-conditioning and hydraulics,
among others, have located in Jackson and have considerably lessened the area's dependence on the automobile industry. Further diversification is provided
by Consumers Power Co.., which serves most of Michigan outside the Detroit area, and which has its head
office in Jackson. A disquieting factor is the nominal

decrease in the city's population over the past 10 years,
but a sharp increase in the population of Jackson
County indicates that people have seemingly chosen to
live in less congested surroundings while working and
trading in the urban center. The general economic
outlook for Jackson and the area it serves is favorable.
Homer, with a population of 16,000, is located 21
miles southwest of Jackson. Although there are a few
local industries, the economy is primarily agricultural.
Farms in the Homer area are of good quality and income per farm family is larger than in many other areas
in Michigan. Rapid growth is not forecast for Homer,
but as residents who work outside the village are increasingly attracted to living in Homer, prospects for
steady growth are good.
The charter bank began branching in 1952 and now
has seven branches in Jackson and Albion, with eight
approved and under construction. The $72.2 million
National Bank of Jackson, with seven branches, also
operates in Jackson. In nearby Marshall, the large
Michigan National Bank operates a progressive branch
whose assets are estimated at more than $22 million.
The $5.6 million Bank of Albion, a single office bank,
is the only competitor of the charter bank's Albion
branch. In the area and region of the charter bank,
competition comes from numerous commercial banks
ranging in size from the main office of the $718.4
million Michigan National Bank, in Lansing, to the
$1.7 million Springport State Savings Bank, Springport, Mich.
Calhoun State Bank serves Homer as a single-office
bank. Ten other banks in surrounding towns from 8to 21-miles distance from Homer, offer alternative
sources of banking to the Homer public but they do not
actively compete with the consolidating bank. This
Bank, established in 1902, has served its community to
the limit of its ability. Approximately 60 percent of
its deposits of $3.2 million, is loaned out. A heavy
demand for mortgage loans is reflected in the fact that
this type of loan accounts for over 50 percent of the
bank's total loans. The consolidated school system of
Homer has heavier loan requirements, as do some other
local applicants for loans, than the limited capital and
deposits permit the consolidating bank to make.
Therefore, arrangements have, of necessity, been made
with larger banks in the area, outside Homer. With
no branches, no trust powers and limited deposits, the
bank's operations are severely limited.
Although the capital and deposits limitations of the
consolidating bank inhibit effective response to financial demands in the Homer area, the bank's most immediately severe problem is management succession.




Active management lies with the executive vice president, who is nearing retirement age, is in poor health
and is consequently unable to bear any longer the burden of bank leadership. There are no other employees in the bank who are qualified to serve in a management capacity. With no prospects of recruiting progressive management personnel from the outside, the
serious management problem is reaching crisis proportions in Homer. In contrast, the charter bank has
been marked by its fine and extensive management, as
reflected in its increase from a $5 million bank in 1933
to a $100 million bank at the present time, its consistent
offering of new services and its new computer system.
In order to keep abreast of modern banking practices,
which enlarge and change rapidly in our dynamic
economy, the charter bank has maintained a policy of
encouraging officers to pursue continuing professional
education. It is indeed fortunate that a bank with
this proven management is prepared to take the reins
from the present executive officer of the consolidating
bank in order to bring the advantages of modern banking to Homer, which, though a small town, deserves
a progressive bank.
There is at the present time no active competition
to the consolidating bank. The areas served by the
charter and consolidating banks cannot be said to overlap. The charter bank has made little effort to enter
the Homer market, a fact attested by the few commercial deposit and loan customers from that area. The
major portion of both deposits and loans of mutual
customers, estimated at $50,000 and $200,000, respectively, is concentrated in two accounts, one of which
is the Homer school system which the consolidating
bank is too small to serve adequately.
The consolidation will eliminate no competition but
will actually bring more competition to the Homer
area by challenging the Marshall branch of the Michigan National Bank, 12 miles from Homer, which the
consolidating bank cannot do. Further, the addition
of the resources of the Galhoun State Bank to those of
the charter bank will be so minimal as to cause no
change in the competitive structure in Jackson. Indeed, the addition of $3.7 million in resources will be
barely perceptible when viewed in light of the $1.6
billion in total resources of all commercial banks in the
region in which the resulting bank will encounter competition. This figure of course does not include the resources of savings and loan associations, finance companies, and other financial institutions all active in the
resulting bank's area of effective competition. To
deny the proposed merger, which will materially improve the quality of banking services in Homer, on the
153

grounds of concentration in the Jackson area would be
to ignore reality and consequently to fail in executing
the congressional mandate to this Office of weighing
consolidation applications by the standards of public
interest.
Applying the statutory criteria to the proposed consolidation, we conclude that it meets these criteria and
the application is, therefore, approved.
NOVEMBER 3,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The City Bank & Trust Co., National Association,
Jackson, Mich., with assets of $100,909,000 proposes
to consolidate with the Calhoun State Bank, Homer,
Mich., with assets of $3,758,000.
Although there appears to exist little direct competi-

tion between the consolidating banks, the proposed
consolidation would eliminate one of only three independent banks in the market area, and would increase
concentration of banking interests to the point where
the acquiring bank and one competitor in Jackson
would control 93 percent of I PC deposits and 95 percent of the commercial bank loan market.
The City Bank & Trust Co., which has operated under a national bank charter only since August 6, 1964,
has made its second application this year for approval
of precisely the same proposed consolidation. As was
previously indicated in the Department's report to the
Board of Governors of the Federal Reserve System,
dated February 25, 1964, this proposed consolidation
would be clearly adverse to the preservation of effective
competition.

CARGILL TRUST CO., PUTNAM, CONN., AND HARTFORD NATIONAL BANK & TRUST CO., HARTFORD, CONN.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Gargill Trust Co., Putnam, Conn., with
and Hartford National Bank & Trust Co., Hartford, Conn. (1338), which had.
merged Nov. 10, 1964, under charter and title of the latter bank (1338). The
merged bank at the date of merger had

COMPTROLLER S DECISION

On September 1, 1964, the $8.3 million Cargill
Trust Co., Putnam, Conn., and the $594 million Hartford National Bank & Trust Co., Hartford, Conn.,
applied to the Comptroller of the Currency for permission to merge under the charter and title of the
latter.
The charter bank is headquartered in Hartford, a
city of 163,000, which serves a trade area of approximately 850,000 persons and is frequently called the
insurance capital of the United States. It is a highly
industrialized city, serving as a trade center for not
only the State of Connecticut but also for much of
New England.
The charter bank presently operates 28 branches
spread over a wide area of central and eastern Connecticut and actively competes for business in other
parts of the State. It has approval for two unopened
branches. The charter bank competes actively with
four other commercial and four mutual savings banks
in Hartford itself. Its major competitor, the Connecticut Bank & Trust Co., operates a total of 32 offices.
154




$8, 561, 750
587, 874, 261
596,436,011

To be
operated

2
29
31

There are 119 commercial bank offices and 71 mutual
savings offices in the Hartford, Middlesex, New London, and Litchfield County areas.
The main office of the merging bank is located in
Putnam, a community of 8,400 which is 42 miles to
the northeast of Hartford in the extreme northeast
corner of the State. The area surrounding Putnam
is devoted to agriculture and the town serves as a
trading center. The primary industry however, has
traditionally been the manufacture of textiles. Following World War II, many of the mills moved to the
South and this, coupled with the disastrous flood of
1955 dealt a severe blow to the economy of the area.
Lately, this has shown signs of recovery, due in part
to State and Federal aid programs. The entrance
into the community of the charter bank will provide
added stimulus to the economic recovery of Putnam
and the surrounding area.
The Cargill Trust Co. competes with the Citizens
National Bank, an $8 million institution situated
directly across the street from it and, in a limited
degree, with the County Bank & Trust Co. and a
branch of Connecticut Bank & Trust Co., both located

in Danielson, 8 miles south of Putnam. There is also
one savings bank in each community. The Cargill
Trust Co. operates one branch, located 6 miles north
of its main office in North Grosvenordale.
There is no competition between the merging banks,
the nearest offices being 26 miles apart. Any loans
made in Putnam by the charter bank have been of a
size or nature that would have precluded the smaller
bank. The primary effect of this merger will be confined to Putnam which should gain substantially by
the presence of a larger bank. The resulting bank
will be far better able to handle the local financial
needs and there will be a fund of expertise to aid
Putnam in its rejuvenation. Moreover, the management succession problem of the merging bank will be
solved. Gargill Trust Co.'s home town competitor,
Citizens National Bank., has been successful to date
and there is no reason why it should not remain so
in the face of this merger.
In balancing the factors of this application in light
of the statutory criteria, it is found to be in the public
interest and the application is, therefore, approved.
NOVEMBER 3,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

Hartford National Bank & Trust Co. is the largest
bank in the State of Connecticut, operating offices

which serve 50 percent of the State's population and
66 percent of all manufacturing establishments. It
had assets as of June 30, 1964, exceeding $594,206,000,
deposits of $511,341,000, and loans and discounts of
$288,713,000.
Cargill Trust Co. operates two offices in Putnam and
North Grosvenordale in the northeastern corner of
Connecticut. Cargill has total resources of $8,341,000, deposits of $7,755,000 and loans and discounts
of $3,778,000.
In the area where Cargill operates, two other small,
independent banks, Citizens National Bank of Putnam
(whose head office is directly across the street from
Cargill) and County Bank & Trust of Danielson, with
resources of $8 million and $1,600,000, respectively,
and the Danielson branch office of Connecticut Bank
& Trust, the State's second largest bank, only slightly
smaller than Hartford, compete.
The proposed acquisition, viewed in the light of
Hartford National's history of acquisitions, the merger
trend in Connecticut generally, Hartford's initial attempt to acquire the two banks in Putnam, and Connecticut Bank & Trust's proposal to acquire the other
Putnam bank should this acquisition be approved, can
only be considered as having seriously adverse effects
on competition in commercial banking. We view
with concern this proposal and the probable competitive effectsflowingfrom its approval.

THE GUILFORD TRUST CO., GUILFORD, CONN., AND THE SECOND NATIONAL BANK OF NEW HAVEN, NEW HAVEN,
CONN.
Banking offices
Name of bank and type of transaction

Total assets

The Guilford Trust Co., Guilford, Conn., with
and the Second National Bank of New Haven, New Haven, Conn. (227),
which had
merged Nov. 16, 1964, under charter and title of the latter bank (227). The
merged bank at the date of merger had

COMPTROLLER'S DECISION

On September 8, 1964, the $115 million Second
National Bank of New Haven, New Haven, Conn., and
the $6.8 million Guilford Trust Co., Guilford, Conn.,
applied to the Comptroller of the Currency for permission to merge under the charter and with the title
of the former.




In
operation

To be
operated

$6,911,120

2

117,886,797

10

124, 816, 331

12

The charter bank and 6 of its 10 branch offices are
situated in New Haven. With a population of 151,400
and a service area of 270,000, it is the third largest
city in Connecticut. The economic base of the New
Haven area is mixed industrial-residential, with a wide
variety of small industries. New Haven is the site of
one of the country's first large-scale urban renewal programs which is providing stimulus to the area's expand155

ing economy. Yale University, New Haven's largest
single employer, is a strong, stable support of the
economy.
Guilford, 15 miles east of New Haven on Long
Island Sound, has a population of 9,000 and serves an
area estimated at 39,000, including the towns of Branford, North Branford, Durham, and Madison. The
larger New Haven banks have entered the towns surrounding Guilford and applications for other new
branches in the area are presently under consideration.
Because of the distance between the applicant banks,
there is virtually no existing competition between them.
The Second National is the correspondent bank of
Guilford Trust and occasionally participates in loans
with them. The entrance of Second National into the
area will provide more effective competition for the
$195 million First New Haven National Bank and the
$108 million Union & New Haven Trust Co., banks
which have penetrated the area around Guilford by
merger and plan in the future to open de novo branches
in the area. It is therefore appparent that the effect
of the proposed merger on the competitive structure
of the area banking community will be as a stimulant
to competition.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and
the application is therefore approved.
NOVEMBER 3,

1964.

SUMMARY OF REPORT BY ATTORNEY

GENERAL

The Second National Bank of New Haven, New Haven, Conn., proposed to acquire by merger the Guilford Trust Co., Guilford, Conn.
Second National is the second largest bank in the
New Haven area, with total resources of $115 million,
equal to approximately 24.5 percent of the resources
of all banks in the competitive area. The three largest
banks combined control 90 percent of total resources.
Guilford Trust has total resources of $6,700,000. It
has been a progressive, vigorous bank. It operates an
active personnel trust department and maintains a full
time man on the road soliciting business, both unusual
in a bank of this size. Second National claims that it
has only limited experience in insurance and pension
trust fields and that Guilford Trust's personnel would
fill this void, a reversal of the usual roles in banks of
these categories.
Guilford Trust is the type of business the Supreme
Court had in mind in United States v. Alcoa, 377 U.S.
271 (1964) when it spoke of the "small independent
that Congress aimed to preserve by § 7" of the Clayton
Act.
The proposed acquisition, viewed in the light of the
concentration existing and proposed by this and other
acquisitions in the area, could only have an adverse
effect on competition in commercial banking in
Connecticut.

WESTERN PENNSYLVANIA NATIONAL BANK, MCKEESPORT, P A . , AND CITIZENS STATE BANK, ALIOJJIPPA, PA.
Banking offices
Kame of bank and type of transaction

Total assets
In
operation

Citizens State Bank, Aliquippa, Pa., with
and Western Pennsylvania National Bank, McKeesport, Pa. (2222), which
had
merged Nov. 21, 1964, under the charter and title of the latter bank (2222).
The merged bank at the date of merger had

COMPTROLLER'S DECISION

On September 14, 1964, the $507.4 million Western
Pennsylvania National Bank, McKeesport, Pa., and
the $4 million Citizens State Bank, Aliquippa, Pa., applied to the Comptroller of the Currency to merge
under the charter and with the title of the former.
McKeesport, with a population of 45,000, is an industrial city located 13 miles southwest of Pittsburgh,
the core of a large six-county industrial area which
156




To be
operated

$4, 168, 338

1

548, 630, 678

50

552, 799, 516

51

contains a population of about 2^00,000. The economy of the area depends principally on steel production and numerous other manufacturing enterprises,
many of which are nationally known.
Aliquippa, population 26,000 is the largest city in,
and contains some 13 percent of the population of,
Beaver County. Located 20 miles northwest of Pittsburgh and 33 miles northwest of McKeesport, it constitutes part of the same greater Pittsburgh industrial
complex.

The charter bank has grown since 1953 into a large
metropolitan full-service bank with 37 branches in its
home county of Allegheny, six in Washington County,
two in Westmoreland County and one in Beaver
County. In addition, five branches are approved but
unopened. Its aggressive policies have made it one of
the major banks in the Pittsburgh metropolitan area,
in which it competes with the $3 billion Mellon National Bank & Trust Co., operating 78 branches; the
$1.2 billion Pittsburgh National Bank, operating 68
branches; and the $406 million Union National Bank
of Pittsburgh, operating 30 branches.
The single office merging bank has generated over
$3 million in deposits since its opening in February
1963. Its rapid growth has put a strain on its capital
and has prompted management to seek an arrangement which would provide adequate resources. The
merging bank, though well managed, lacks management depth, which in the future will probably present
a succession problem. The merger will obviate this
problem by providing the needed management
personnel.
The merger will also introduce into the merging
bank's service area a bank with sufficient capital resources to meet the growing credit needs of the area.
Trust and other services of a full-service institution,
with emphasis on retail banking, will become available
in an area which in other respects enjoys all of the
conveniences of a large metropolis.
Primarily because of the distance between the main
office and branches of the charter bank and the office
of the merging bank, little or no competition exists between the two. The nearest branch of the charter
bank is at New Brighton, which is separated from the
merging bank's sendee area by the Ohio River. Consummation of the proposed merger will not materially
affect the competitive ability of the charter bank vis-avis the dominant banks in the area. The position of
the charter bank as third largest among banks in the
Pittsburgh area will remain substantially unchanged.
The presence of a large bank in the merging bank's
service area will encourage competition with the large
metropolitan banks active in and around Aliquippa.
Accordingly, we conclude that the merger will not adversely affect competition in the relevant market.
Applying the statutory criteria to the proposal, we
conclude that it is m the public interest and the application is, therefore, approved.
NOVEMBER 13,1964.




SUMMARY OF REPORT BY ATTORNEY GENERAL

Western Pennsylvania National Bank is the third
largest bank in the Pittsburgh area (Allegheny County), acounting for approximately 10 and 12 percent
of the commercial banking deposits and loans, respectively, therein. This area has for many years been
characterized by an unusually high degree of concentration in commercial banking, the result to a large
extent of a great many mergers and acquisitions by the
leading banks. The top three Pittsburgh banks currently control approximately 85 percent of total Allegheny County deposits while the top four control approximately 93 percent. The remaining deposits are
shared by 18 banks.
Western itself has been an extremely active participant in the area's consolidation movement having since
1953 acquired 21 small- and medium-sized banks in
Allegheny County and the adjoining Counties of Westmoreland, Washington, and Beaver. The instant proposal is Western's third merger in Beaver County in
less than a year. With Mellon National Bank & Trust
Co. and Pittsburgh National Bank, the area's two largest banks, having acquired or opened branches
throughout the counties adjoining Allegheny and with
Western acquiring formerly independent banks in generally the same localities, the dominance enjoyed by
these banks in Pittsburgh is being extended throughout the broader area constituting "Greater Pittsburgh."
It does not appear that any significant competition
exists between Western and Citizens State Bank because of the number of miles and the Beaver and Ohio
Rivers intervening between their offices. Nonetheless,
this transaction will eliminate from Beaver County
another independent bank which during an existence
of less than 2 years has demonstrated that it could probably continue to grow as an independent although possibly not as quickly as if it were part of Western. The
latter, on the other hand, has not presented any overriding reasons why it should enter Aliquippa by acquisition rather than by establishing its own branch. The
continuing elimination of independent banks from
Beaver County and the rest of the Greater Pittsburgh
area may make the existence of those independents
remaining more difficult and encourage their acquisition by Western or other of the Pittsburgh banks.
For these reasons, we believe that approval of this
merger will have an adverse effect on competition in
the Greater Pittsburgh area.

157

THE PEOPLES NATIONAL BANK OF LONG ISLAND, PATCHOGUE, N.Y., AND THE NATIONAL BANK OF LAKE
RONKONKOMA, LAKE RONKONKOMA, N.Y.
Banking offices
Name of bank and type of transaction

Total assets

The National Bank of Lake Ronkonkoma, Lake Ronkonkoma, N.Y. (13130),
with
and the Peoples National Bank of Long Island, Patchogue, N.Y. (12788),
which had
.
.
.
merged Dec. 4, 1964, under the charter and title of the latter bank (12788).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On September 3, 1964, the $36 million Peoples National Bank of Long Island, Patchogue, N.Y., and the
$12 million National Bank of Lake Ronkonkoma, Lake
Ronkonkoma, N.Y., applied to the Comptroller of the
Currency for permission to merge under the charter
and title of the former.
Patchogue, located at the head of Great South Bay
on the southern shore of Suffolk County, Long Island,
is a village 60 miles east of New York City. Suffolk
County, a fast growing, industrially diversified area
that has tripled its population in 15 years, now has
860,000 persons. Within the county, two-thirds of the
residents are employed by a variety of manufacturing,
commercial, service and construction concerns, in combination with various government sponsored activities.
Patchogue, a village of 10,000 persons, with a trade
area of 40,000 persons, is a residential community.
The commercial activity in Patchogue serves primarily
the residents of the village and its trade area.
Lake Ronkonkoma, 10 miles north of Patchogue
and also in Suffolk County, has an estimated population of 10,000 persons and a trade area population of
20,000. It is primarily residential with little or no
business activity other than the commercial establishments serving the residents.
The charter bank, with its five branches, and the
merging bank, with its one approved but unopened
branch, comprise only a small part of the 129 banking
offices and 21 approved but unopened branches in
Suffolk County. Among the 23 commercial banks
maintaining offices in Suffolk County, the charter and
merging banks rank 10th and 19th, respectively, and
the resulting bank will rank 9th. Competing with
them are such major banks as the $1.2 billion Franklin
National Bank, the $327 million Security National
Bank, and the $113 million Valley National Bank.
The proposed merger will provide a bank better
158




To be
operated

In
operation

$15,536,617

1

35, 452, 546

5

50, 989,163

6

able to meet the needs and serve the interests of the
Suffolk County community by providing a broaderbased institution capable of meeting the general credit
demands of this rapidly growing community. By
virtue of this broader capital base, it should be able
to handle a higher volume of larger loans that may
well enable it to meet its competition with lower
interest rates.
Approval of the proposed merger will have the
added benefit of freeing one more municipality from
the outdated, anticompetitive home office protection
rule that prevails in New York State. Since there
will no longer be a bank with a home office in Lake
Ronkonkoma, that village will be open to branching.
As an indication of the benefit to a community that
follows from the lifting of home office protection,
three banks have indicated an intention to apply for
a branch office in Lake Ronkonkoma if the proposed
merger is approved. Thus the merger will actually
promote competition in Suffolk County.
Applying the statutory criteria to the proposed
merger, we conclude that it is in the public interest and
the application is therefore approved.
DECEMBER 2,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The Peoples National Bank of Long Island proposes
to acquire the National Bank of Lake Ronkonkoma.
As of June 30, 1964, the latter had total assets of
$12.2 million, total deposits of $11.1 million, and loans
and discounts of $5.2 million. It operates entirely
through a main office located at the village of Lake
Ronkonkoma, town of Brookhaven, Suffolk County,
N.Y., and has approval for an unopened branch at
Farmingville in the same township.
The Peoples National Bank of Long Island operate
through a main office at Patchogue, town of Brookhaven, and maintains five branches within that township's limits. As of June 30, 1964, it had total assets

of $36.1 million, total deposits of $33 million, and
loans and discounts of $15.5 million.
Of nine commercial banks having offices within
the town of Brookhaven, Peoples ranks fifth and Lake
Ronkonkoma eighth. The Resulting Bank would advance to fourth position, well below three much larger
banks.
Although the application fails to set forth many facts
pertinent to competition between the merging banks,

indicia do exist that each is a significant competitive
factor, both with other banks in the area and between
themselves. This competition will be eliminated as
a direct result of the merger.
Because concentration of banking facilities in the
area will be somewhat increased and rivalry between
the merging banks will be completely eliminated, the
effects on competition resulting from this merger will
be adverse.

THE FIRST TRENTON NATIONAL BANK, TRENTON, N.J., AND THE HIGHTSTOWN TRUST CO., HIGHTSTOWN, N J .
Banking offices
Name of bank and type of transaction

Total assets

Hightstown Trust Co., East Windsor Township, N.J., with
and First Trenton National Bank, Trenton, NJ. (1327), which had
merged Dec. 11, 1964, under the charter and title of the latter bank (1327).
The merged bank at the date of merger had

COMPTROLLER S DECISION

In order to prevent the probable failure of the
Hightstown Trust Co., Hightstown, N.J., the First
Trenton National Bank, Trenton, N.J., and said
Hightstown Trust Co. applied to the Comptroller of
the Currency on October 30, 1964, for permission to
merge under the charter and with the title of the
former.
On October 28, 1964, the Commissioner of the Department of Banking and Insurance of the State of
New Jersey certified as to the probable failure of the
Hightstown Trust Co, It is therefore found that an
emergency situation exists and with respect to such

In
operation

To be
operated
3
9

$23, 547, 545
225, 260, 467
248, 808, 012

12

situation this Office must act immediately to prevent
the probable failure of the Highstown Trust Co. Accordingly, the reports of competitive factors provided
for by 12 U.S.C. 1828(3c) are waived.
Because of the emergency nature of this situation,
and in order to protect the depositors, creditors and
shareholders of the Hightstown Trust Co., the application to merge is hereby approved effective at the
close of business Friday, December 11, 1964.
DECEMBER 10,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

(No report requested—none received)

FIRST NATIONAL BANK OF EBENSBURG, EBENSBURG, P A . , AND THE FIRST NATIONAL BANK OF BARNESBORO,
BARNESBORO, P A .
Banking offices
Name of bank and type of transaction

The First National Bank of Barnesboro, Barnesboro, Pa. (5818), with
was purchased Dec. 12,1964, by the First National Bank of Ebensburg, Ebensburg, Pa. (5084), which had
After the purchase was effected, the receiving bank bad




Total assets

In
operation

To be
operated

$4, 902, 440

1

15,588,275
20, 436, 334

2
3

159

COMPTROLLER S DECISION

On October 12, 1964, the $15.2 million First National Bank of Ebensburg, Ebensburg, Pa., applied to
the Comptroller of the Currency for permission to purchase the assets and assume the liabilities of the $4.8
million First National Bank of Barnesboro, Barnesboro,
Pa.
Ebensburg, home of the purchasing bank, has a
population of over 4,000 and serves an area of approximately 25,000. It is the county seat of Cambria
County whose population of 200,000 depends basically
on coal mining with some support from industry and
agriculture.
The selling bank is located in Barnesboro, a community of 3,000 situated 16 miles north of Ebensburg.
Barnesboro is in the center of a large cluster of small
coal mining villages and is almost completely dependent upon the production of coal and one garment
manufacturing company. The area has a very high
rate of unemployment.
The amount of competition existing between the
banks is minimal because they are located 16 miles
apart separated by hilly terrain with three competing
banks operating in the area between them. The
present banking structure in the combined service
areas of the two participating banks will not be significantly altered by the transaction. The proposal
will reduce the number of banks in this area from 13 to
12, with the major competition being provided by the
$15.3 million Cambria County National Bank, Carrolltown, the Nanty Glo Branch of the $80 million United
States National Bank in Johnstown, and the South
Fork Branch of the $20 million First National Bank,
Indiana.
The charter bank will have an increased lending
capacity which will enhance its ability to attract new
industry to the Barnesboro and Ebensburg areas. The
First National Bank of Ebensburg's future branch in
Barnesboro will be able to provide the people of that
community with an improved consumer loan department, a school savings program and greater savings,
convenience and safety to the banking public through
the use of electronic data processing and improved
auditing control. In addition, trust services, which
are presently not available in the Barnesboro community, will be offered by the experienced trust department of the charter bank in the Barnesboro branch.
The resulting bank will furnish the Barnesboro banking
public with the generally better and more diversified
services and the benefits flowing from aggressive
younger management.
160




Applying the statutory criteria to the proposal, we
conclude that it is in the public interest and the
application is, therefore, approved.
DECEMBER 11,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The purchasing bank is headquartered in the county
seat of Cambria County and operates a branch in Cresson, 7.5 miles to the east, which it acquired in 1961.
The only other bank in Ebensburg is a branch of the
Cambria County National Bank of Carrolltown (9
miles north of Ebensburg) which the latter acquired
in 1958. Of the five other banks operating in the area
around Ebensburg, one is a branch of the U.S. National Bank of Johnstown (assets of $78 million), and
another is a branch of the First National Bank of Indiana (assets of $19.4 million). Two of the three
remaining small banks each has assets of only $2 million. The U.S. National branch was acquired in
1961 while the First National of Indiana merged the
Union Deposit Bank with a preexisting branch in
South Fork in 1960.
There appears to be little or no presently existing
competition between the Purchasing Bank and the
Selling Bank which operates one office in Barnesboro,
16 miles north of Ebensburg. The latter bank is, however, the second largest bank in and around Barnesboro, accounting for approximately 15 percent of the
percent of the area's deposits and loans. On the other
hand, Cambria County National has approxmiately
half of such deposits and loans.
If this transaction is approved, the Resulting Bank
would have $20.4 million or 42 percent of this area's
banking assets while Cambria County National would
have $14.4 million or 30 percent. The largest of the
five other banks in this area has assets of only $3.3
million. The resulting concentration of assets in the
hands of the Resulting Bank and of Cambria County
National may adversely affect the competitive position
of the other much smaller banks.
The area around Ebensburg is already characterized
by a similar imbalance in banking assets among the
banks competing therein. This imbalance has resulted to a large extent: from the acquisitions and
mergers noted in the first paragraph above. Approval
of the instant transaction may further what thus appears to be a steadily developing trend toward concentration through acquisitions and mergers. We
therefore believe that such approval may have some
adverse effect on competition.

FIRST NATIONAL BANK & TRUST C O . OF HANOVER, HANOVER, P A . , AND NATIONAL BANK & TRUST G O . OF CENTRAL
PENNSYLVANIA, YORK, P A .
Banking offices
Name of bank and type of transaction

Total assets
In
operation

First National Bank & Trust Go. of Hanover, Hanover, Pa. (187), with
and National Bank & Trust Go. of Central Pennsylvania, York, Pa. (694),
which had
merged Dec. 14, 1964, under charter and title of the latter bank (694). The
merged bank at the date of merger had

COMPTROLLER'S DECISION

On October 16, 1964, the $29.4 million First National Bank & Trust Co. of Hanover, Hanover, Pa.,
and the $157.2 million National Bank & Trust Co.
of Central Pennsylvania, York, Pa., applied to the
Comptroller of the Currency to merge under the
charter and title of the latter.
York, with a population of 53,000, is the county seat
of York County and is located approximately 25 miles
south of Harrisburg. While the county is noted for its
agricultural productivity, it is also experiencing growth
in industrial, commercial and service organizations.
Its principal industries include machinery, paper and
allied products, apparel and related products, and primary and fabricated metal products.
In the three-county area of Cumberland, Dauphin
and York, where the charter bank operates 16 offices,
there are upwards of 621,000 people and about 1,000
industrial plants employing approximately 300,000
workers. There are 6,000 farms, with dairying, grain
growing and cattle feeding as the principal sources
of farm income.
The borough of Hanover, with a population of
16,000, is situated 20 miles southwest of York in southwestern York County. Hanover is one of the thriving
communities in the area as it is the business center for
a prosperous surrounding agricultural region. At the
same time, it has the benefits of a shoe factory and
many other smaller industries engaged in the manufacture of books, steel products, clothing, and textiles.
While the charter bank is the largest, by a small
margin, of the 42 banks in central Pennsylvania, it
competes with the aggressive $133 million DauphinDeposit Trust Co. and the $130 million Harrisburg
National Bank & Trust Co., both of Harrisburg. In
this area of burgeoning economic growth, these competitors are pressed to satisfy local credit demands
which, if unmet, will resort to larger cities with greater
financial resources.
770-rvG:{--05




To be
operated

$30,166,156

2

165, 853, 937

16

196,020,093

18

The merging bank is the largest bank in Hanover.
Its principal local competitors are Bank of Hanover
& Trust Co., and Farmers Bank & Trust Co., both of
which have resources of $16 million.
Because of the 25-mile distance between the merging
and charter banks, and the absence of significant competition between them, the anticompetitive effects of
the merger are not cognizable.
The merger of the two banks will provide a better
lending policy and more operating supervision than
the merging bank is now receiving. The charter bank
will be able to provide the customers of the merging
bank with better trust services, capable management
personnel, and an increase of loanable funds for the
Hanover area to keep pace with the area's growing economic needs.
In balancing the facts of this case in light of the
statutory criteria, we find that the merger is in the
public interest and the application is, therefore,
approved.
DECEMBER 11,

1964.

SUMMARY OF REPORT BY ATTORNEY

GENERAL

National Bank & Trust Co. of Central Pennsylvania,
York, Pa. (Central York), is the largest bank in the
tricounty area of York, Dauphin, and Cumberland,
with deposits of $136,911,000. It operates 16 banking
offices in this area. During the past 5 years Central
York has consolidated or merged with 5 independent
banks, acquiring 12 of its banking offices in this
manner.
First National Bank & Trust Co. of Hanover, Hanover, Pa. (First Hanover), is the largest of four banks
in Hanover, and the fifth largest in York County, with
deposits of $24,747,000.
Existing direct competition between the participating banks appears limited.
In York County, where the participating banks do
most of their business, the 17 banks maintaining offices
161

have total deposits of $440,609,000. Central York has
31 percent of this total and First Hanover has 5.6
percent. The resulting bank would have 36.6 percent
of total deposits of York County banks, a substantial
increase. Further, a merger of the largest and fifth
largest banks in York County would result in a bank
with deposits almost twice the size of those of the
second largest bank in the county.

This merger would serve to further accelerate the
trend toward concentration of bank resources in the
area, eliminate existing and potential competition between the merging banks, and enhance the competitive
imbalance already existing between the largest bank
in the area, Central York, and the smaller banks.
Thus, the proposed merger, if consummated, may have
a seriously adverse effect upon competition.

THE FIRST NATIONAL EXCHANGE BANK OF VIRGINIA, ROANOKE, VA., AND THE CITIZENS NATIONAL BANK OF
COVINGTON, COVINGTON, VA.
Bankin I °ffices
Name of bank and type of transaction

Total assets

The Citizens National Bank of Govington, Govington, Va. (5326), with
and the First National Exchange Bank of Virginia, Roanoke, Va. (2737),
which had...
merged Dec. 15, 1964, under the charter and title of the latter bank (2737).
The merged bank at the date of merger had
COMPTROLLER'S DECISION

On October 1, 1964, the $223 million First National
Exchange Bank of Virginia, Roanoke, Va., and the $15
million Citizens National Bank of Covington, Covington, Va., applied to the Comptroller of the Currency
for permission to merge under the charter and with
the title of the former.
Roanoke, head office of the charter bank, is a city
of 97,000 in a metropolitan area of about 159,000.
It serves as the trade center of the entire western
quadrant of Virginia ranging from the coal mines of
Appalachia to the tobacco fields of southern Virginia.
As a major manufacturing center, it produces a wide
variety of products, chief of which are steel goods,
furniture, textiles, and electronic equipment. Economic growth progresses at a substantial rate, with
a resultant unemployment rate well below the national
average.
Covington, located about 65 miles northwest of
Roanoke, has a population in excess of 11,000 in a trade
area of over 70,000. Its economy depends on a diversification of industry and agriculture and is experiencing
steady growth.
The charter bank is an aggressive, well-managed
institution operating 20 offices in nine communities
throughout southwest Virginia. Its growth has been

162




To be
operated

In
operation

$15,231,684

1

245 641,387

20

260, 492, 687

21

in response to the need for a regional bank of sufficient
size to meet the credit requirements and to aid the economic development of the southwestern part of the
State. In meeting the need for a southwestern Virginia regional bank, the charter bank has come into
competition with such large statewide banking systems
as the $230 million Virginia Commonwealth Corp. and
the $484 million United Virginia Bankshares, bank
holding companies; the S450 million First & Merchants National Bank; and the $410 million Virginia
National Bank. The charter bank also competes with
the $55.3 million Colonial-American National Bank,
Roanoke, and the $41.3 million Mountain Trust Co.,
Roanoke.
The single office merging bank is conservatively
operated and has experienced only moderate growth
in recent years. Since its organization in 1900, it has
not been involved in any merger or acquisition. It
competes with the $9.2 million Covington National
Bank, Covington, Va.
The continued growth of the charter bank as a
regional banking system for southwest Virginia is
necessary if the region is to realize its economic
potential. At the present time many of the national
manufacturing companies active in southwest Virginia
must resort to the financial facilities of larger banking
institutions in other regions because of the inability of

the local banks to accommodate these needs. Not only
will the merger increase the charter bank's ability to
participate more fully in the economic development of
its region, but the merging bank's service area will
have available for the first time the financial resources
of a full-service bank.
Consummation of the proposed merger will not
eliminate competition as the participating banks do
not serve the same areas. The charter bank's position
in relation to the other banks in Roanoke and throughout southwest Virginia will remain unchanged. Covington will henceforth have a branch of a regional
bank offering broad services. Throughout the entire
southwest region of Virginia, alternative banking
services will continue to be offered by numerous local
banks and branches of the large statewide banking
systems of Virginia. Accordingly, no adverse effect
upon competition in the region can be foreseen.
Appling the statutory criteria to the proposed
merger, we conclude that it is in the public interest
and the application is therefore approved.
DECEMBER 11, 1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

First National Exchange Bank, Roanoke, the
largest bank in southwestern Virginia, with assets of
$223 million, proposes to merge Citizens National
Bank of Covington, a bank with assets of $14,958,000
and located in southwestern Virginia. Since October
of 1960, First National Exchange has merged 8 banks.
The total deposits in these banks at the time merged
exceeds 41 percent of the present deposits of First
National Exchange and 13 (or 72 percent) of the 18
banking offices now operated by First National Exchange were acquired in the same mergers.
The explosive growth of First National Exchange
Bank via the merger process and the resultant elimination of eight independent banks in the space of about
4 years is a source of concern from a competitive standpoint; particularly so since it contributes to the rapidly
increasing concentration of banking in Virginia by
large banking institutions. The approval of the instant merger would further the trend of expansion
and concentration by merger.
It is our view that the effect of such increased concentration on competition is adverse.

FARMERS NATIONAL BANK OF BLOOMSBURG, BLOOMSBURG, PA., AND THE MINERS NATIONAL BANK OF WILKESBARRE, WILKES-BARRE, PA.
Banking offices
Total assets

Name of bank and type of transaction

In
operation
The Farmers National Bank of Bloomsburg, Bloomsburg, Pa. (4543), with
and Miners National Bank of Wilkes-Barre, Wilkes-Barre, Pa. (13852) which
had
merged Dec. 16, 1964, under charter and title of the latter bank (13852).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On September 30, 1964, the $8.5 million Farmers
National Bank of Bloomsburg, Bloomsburg, Pa., and
the $102 million Miners National Bank of WilkesBarre, Wilkes-Barre, Pa., applied to the Comptroller
of the Currency for permission to merge under the
charter and title of the latter.
Wilkes-Barre, the county seat of Luzerne County
and a typical example of Pennsylvania's economic
problems of the past 15 years, is 120 miles northwest
of Philadelphia. The population of Wilkes-Barre declined 17.2 percent to 63,551 in the decade ending
1960. The economic mainstay of the county, coal




To be
operated

$8, 629, 066

1

107,470,802

6

116,099,867

7

mining, employed 63,000 people three decades ago
and now employs about 3,800. The result of this
decline is a present male unemployment rate of 7.8
percent. Attempts are being made to diversify the
economy through community development projects
throughout the Wilkes-Barre trading area which
serves 200,000 people.
Bloomsburg, the site of the single office merging
bank and the county seat of Columbia County, has a
population of 10,655, which makes it the second largest
municipality in Columbia County. The town is 41
miles southwest of Wilkes-Barre. The principal economic factor in Bloomsburg is a newly located textile
industry which, although it employs mostly women,
163

supplies 3,300 jobs for Bloomsburg alone. Like
Wilkes-Barre, Bloomsburg is afflicted with a high rate
of unemployment.
The charter bank competes with 13 banks in its service area, excluding the Bloomsburg bank. The main
sources of competition are the $86 million First National Bank, Wilkes-Barre, and the Wilkes-Barre
branch, of the $186 million Northeastern Pennsylvania National Bank & Trust Co., Scranton, Pa. The
proposed merger will have no appreciable competitive
effect in Wilkes-Barre.
The proposed merger should benefit the Bloomsburg area. Specifically, the resulting bank will be able
to provide competitive trust services to those residents
of Bloomsburg who require it.
On the management level this proposal will provide a solution to existing problems. While senior
management in both banks is good, the lack of depth
in the management ranks of the merging bank portends future difficulties. The charter bank is equipped
at present to supplement this deficiency in the merging
bank.
The entrance of the charter bank into Bloomsburg
by merger will be felt by the $7 million First National
Bank, Bloomsburg, and the $17 million BloomsburgGolumbia Trust Co. First National, which has a

progressive loan policy, will receive more competition
from the equally alert charter bank and the trust department of the charter bank will provide competition
to the trust department of Bloomsburg-Columbia.
As a result of the merger, competition in Bloomsburg should be heightened, with overall benefits to the
community at large, which needs an economic
stimulant.
Applying the statutory criteria to this proposal, this
application is hereby approved.
DECEMBER 14,

1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The proposed merger apparently would eliminate
no significant direct competition between the applicants. It will, however, continue a trend toward
concentration in Miner's service area and in the State
of Pennsylvania. It will also add to Miners' present
position of dominance in its service area and the entry
of Miners into Farmers' service area will create a
serious imbalance of banking power in Bloomsburg,
since Miners will control 75.5 percent of total deposits
and 77 percent of total loans, and seriously threaten
future competition. We therefore feel that the impact of the merger upon present and future competition will be significantly adverse.

FIRST NATIONAL BANK, WELLSBORO, P A . , AND THE PATTISON NATIONAL BANK OF ELKLAND, ELKLAND, P A . ; THE
FIRST NATIONAL BANK OF KNOXVILLE, KNOXVILLE, P A . ; AND THE FARMERS' NATIONAL BANK OF LIBERTY,
LIBERTY, P A .
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Pattison National Bank of Elkland, Elkland, Pa. (5043), with
The First National Bank of Knoxville, Knoxville, Pa. (9978), with
and the Farmers' National Bank of Liberty, Liberty, Pa. (11127), with
were purchased Dec. 16, 1964, by the First National Bank of Wellsborough,
Wellsboro, Pa. (328), which had
After the purchase was effected, the receiving bank had

COMPTROLLER S DECISION

On October 1, 1964, the $9.6 million First National
Bank, Wellsboro, Pa., applied to the Comptroller of the
Currency to purchase the assets and assume the liabilities of the $3 million Pattison National Bank of Elkland, Elkland, Pa.; the $1.4 million First National
Bank of Knoxville, Knoxville, Pa.; and the $2.5 million Farmers' National Bank of Liberty, Liberty, Pa.,
164




To be
operated

$2, 978, 494
1, 528,186
2, 556, 792

1
1
1

9, 635, 362
16,477,038

2
5

under the charter of the former and with the title "The
Northern National Bank and Trust Company."
The four applicant banks are located in Tioga
County, a mountainous area in northern Pennsylvania
with a population of about 36,000. The towns of
Wellsboro and Elkland have some economic diversification as a result of industrial activity but the remainder
of the county depends primarily on dairy farming. Althrough the area served by the four banks is somewhat

isolated due to the rugged terrain, easy access to Corning and Elmira, N.Y., by highway provides retail
shopping facilities and employment opportunities for
many county residents.
The purchasing bank, the county's oldest and largest
bank, has been active since 1864. It has not participated in any mergers or acquisitions in its history. It
was the first institution in the county to establish a
branch office, located in Tioga. Of the four banks
involved in this proposal, it alone offers trust services
and a full range of retail banking services.
Due to their small size and lack of aggressive management, the three selling banks are unable to serve the
public adequately and to promote the economic progress of their service areas.
The executive officers and most of the directors of
the selling banks have served their banks for many
years and desire to retire from banking. Lack of successor management and the virtual impossibility of recruiting personnel to manage these banks constitutes
a serious problem for them.
The existence of several very small unit banks offering only limited banking services to the public frustrates the promotion of industrial and commercial development in Tioga County. Consummation of the
proposed purchase and assumption of the selling banks
will vest in the acquiring bank greater resoures to
accommodate larger credit requests and to otherwise
improve banking services in Tioga County. In addition, consolidation of the four banks into one resulting
bank will achieve efficiency in operations and personnel, thereby providing for better use of bank capital.
Further, the resulting bank will solve the management
succession problem of the selling banks and be better
able to recruit new personnel.
All of the participating banks are at least 5 miles

apart and serve separate communities with the result
that there is no significant competition among them
which will be eliminated by the proposed unification.
Although the number of unit banks in the county will
be reduced, alternate banking services are available
from other banks in and outside of Tioga County.
Applying the statutory criteria to the proposed acquisition, we conclude that it is in the public interest
and the application is therefore approved.
DECEMBER 11,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The First National Bank of Wellsborough, the purchasing bank, was organized on March 21, 1864. It
has organized and maintains one branch situated in the
village of Tioga, Tioga County, Pa. Elkland bank
was organized in 1896, Knoxville bank in 1911 and Liberty Bank in 1918.
All four banks are located in small towns. The
population of Wellsboro is 4,369, Elkland 2,189, Knoxville 694, and Liberty 269. Each bank serves primarily
farmers and small businessmen in its immediate area.
The proposed merger will completely eliminate unit
banking in three areas of Tioga County, Pa., and substitute branches of a bank which, in its own area of
Wellsboro, has 56.8 percent of the business. The resulting bank will have no direct competitors, except in
Wellsboro where the position of a single competitor
will be materially weakened.
It appears, therefore, that the proposed purchase
of assets and assumption of liabilities of the Pattison
National Bank of Elkland, the First National Bank of
Knoxville and the Farmers' National Bank of Liberty
by the First National Bank of Wellsborough will have
some adverse effect on competition and further a tendency toward monopoly in the areas involved.

NATIONAL COMMUNITY BANK OF RUTHERFORD, RUTHERFORD, N.J., AND THE GARDEN STATE NATIONAL BANK
OF TEANECK, TEANECK, N.J.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Garden State National Bank of Teaneck, Teaneck, N.J. (12402), with
and National Community Bank of Rutherford, Rutherford, N.J. (5005),
which had
merged Dec. 18,1964, under the charter and title of the latter bank (5005).




$37, 758, 612

15

172, 029, 741

To be
operated

2

209, 788, 353

17

165

COMPTROLLER S DECISION

On October 14, 1964, the $172.2 million National
Community Bank of Rutherford, Rutherford, N.J.,
and the $37 million Garden State National Bank of
Teaneck, Teaneck, N.J., applied to the Comptroller
of the Currency for permission to merge under the
charter and with the title of the former.
The applicant banks are located in Bergen County
in the northeastern part of New Jersey west of New
York City. The county's population has grown rapidly from 675,000 in 1955 to about 869,000 at present,
with an estimated population of 1,165,000 by 1973.
Because the county is linked to New York City by a
network of highways and forms essentially a part of
the greater New York metropolitan area, it serves
chiefly as a residential suburb of New York. It also
has highly developed and well-diversified industries,
which are attracted by excellent roads, skilled labor,
and proximity to the northeastern markets. Bergen
County should continue for some time to support residential and industrial growth as a part of the greater
New York City area.
The charter bank maintains 14 branches throughout
the southern part of the county. It is a modern, fullservice institution offering competitively the services
which a highly urbanized population demands. As the
second largest bank in Bergen County, it competes
with 26 other banks operating 55 branches, chief of
which are the $281.6 million Peoples Trust Co. of
Bergen County, operating 16 branches, the $110.4 million Citizens National Bank of Englewood, operating
8 branches, and the $99.8 million Hackensack Trust
Co., operating 7 branches.
The single-office merging bank is the eighth largest
bank in Bergen County and serves the city of Teaneck. Although past growth has been good, absence
of branches, automation, and a complete line of banking services places it at a competitive disadvantage

with the large Teaneck branch of the Peoples Trust Co.
of Bergen County.
If the banks in Bergen County are to participate
more fully in assisting the county to realize its potential
and to reduce the dependence of its residents and industries upon financial institutions located elsewhere,
greater consolidation of banking assets to achieve increased lending limits and greater operating efficiency
is needed. There can hardly be balanced economic
development in an area without a corresponding
growth of banking facilities and credit to meet its
needs. The consummation of the proposed merger
will, therefore, serve to advance the well-being of
Bergen County.
The applicant banks have neither contiguous nor
overlapping service areas and, therefore, the proposed
merger will not have an adverse effect upon competition. The merger will not alter the relative position
of the charter bank in Bergen County. It will have
the salutary effect of promoting competition with the
Teaneck branch of Peoples Trust Co. of Bergen
County.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and
the application is, therefore, approved.
DECEMBER 18, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

This merger, if approved, will eliminate any presently existing and potential competition between the
two banks and lead to the disappearance of a financially strong and prosperous independent unit bank.
It would be the second merger of Rutherford Bank
during the latter half of 1964 and it will unduly increase banking concentration in Bergen County, N.J.,
enabling the two largest banks to control approximately
40 percent of all deposits and loans in that county.
The competitive effect of the proposed merger, therefore, would be adverse.

THE FIRST NATIONAL BANK IN GADSDEN, GADSDEN, ALA., AND THE STATE NATIONAL BANK OF ALABAMA,
DECATUR, ALA.
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The First National Bank in Gadsden, Gadsden, Ala. (13728), with
and State National Bank of Alabama, Decatur, Ala. (14414), which had
merged Dec. 19, 1964, under charter and title of the latter bank (14414).
The merged bank at the date of merger had

166




$18, 672, 359
117,934,892
136, 357, 300

To be
operated

1
18
18

COMPTROLLER S DECISION

On October 5, 1964, the $112 million State National
Bank of Alabama, Decatur, Ala., and the $18 million
First National Bank in Gadsden, Gadsden, Ala., applied to the Comptroller of the Currency for permission to merge under the charter and with the title of
the former.
The charter bank, with 18 offices located in 14 cities,
operates in a region comprised of the northern tier of
Alabama counties. Decatur, location of the main office, is a city of 29,000 persons. It is situated on the
Tennessee River in north-central Alabama and serves
as a county trade center. While the economy of the
surrounding rural area is based primarily on agriculture, especially poultry raising, Decatur has achieved
economic balance with a variety of light and medium
industries, as well as with heavy industry in the form
of a chemical complex on the banks of the Tennessee
River. Those activities characterizing Decatur and its
surrounding area also characterize the greater part of
the northern Alabama region. Among the other cities served by the charter bank, Huntsville is especially
important. The phenomenal growth of this city over
the past few years, due primarily to the location of a
major segment of this country's military space efforts,
has contributed greatly to the economic renaissance in
the northern region of Alabama.
Gadsden, home of the unit merging bank, has a population of 58,000 persons. It is located in Etowah
County, 75 miles southeast of Decatur and 85 miles
northeast of Birmingham. The community's economy,
highly industrialized in comparison to the remainder
of Alabama, and primarily dependent on the steel industry, also receives substantial stimulus from agricultural activities in the rural areas of the county. Indicative of the economic potential in the Gadsden area is
the $40 million investment in a new plant recently
announced by Republic Steel Corp. The cyclical
swings inherent in the steel industry present a weak spot
in the community's economy, however.
The charter bank, although the fifth largest in the
State, is considerably smaller than either of the two
large Birmingham banks, one of which has resources
of approximately $500 million and the other of approximately $250 million. Both of these banks actively
solicit commercial and industrial customers in the region served by the charter bank and offer strong competition there. While the charter bank is clearly larger
than any of the other area competitors on an aggregate
resources basis, analysis of deposit and loan figures for
the communities that it serves indicates that its com-




petitors have larger market shares in the majority of
locations.
The merging bank3 second largest in Etowah County, holds slightly less than 25 percent of total county
deposits and loans but its market share, and that of the
largest bank, has been slipping steadily since 1950.
This decline and the concommitant increase in the
market shares of the smaller banks in what appears to
be a growing market indicate considerable strength in
the smaller banks and their vigor in the face of
competition.
Consummation of the proposed merger will serve the
convenience and needs of the Gadsden community
more adequately than at present. The record of the
charter bank in the introduction of new services and
banking facilities to customers and the public in its
area, including among other items, consumer lending,
expanded trust facilities, drive-in and walkup teller
windows, and parking accommodations, demonstrates
its ability and willingness to fulfill its responsibilities.
The resulting bank's resources, both financial and managerial, will enable, it to counteract the adverse economic effect flowing from any cyclical downswing in
the steel industry. Since an economically diversified
and balanced region will supply the resulting bank's
resources, a downtrend in one community's economy
will not impair the bank's resources and ability to meet
credit needs there as it would a unit bank in such a
community. In addition, the resulting bank's lending
limit, more than three times that of the largest Gadsden bank, will provide a community source for credit
needs heretofore satisfied only by outside funds and
for anticipated credit needs of the community's expected industrial expansion.
Consummation of the proposed merger will have
little, if any, effect upon competition. While the resulting bank will replace a smaller bank in Gadsden,
no appreciable change in the strongly competitive
banking structure is expected. Despite their disparate
sizes, the Gadsden and Eetowah County banks appear
to be sufficiently aggressive to continue the effective
competition demonstrated in the past. In addition,
three applications have been made to the appropriate
banking authorities to charter new banks in Gadsden
since the filing of the present application, thus providing further evidence that entry of the resulting
bank will have no adverse effect upon competition.
Appling the statutory criteria to the proposed
merger, we conclude that it is in the public interest
and the application is therefore approved.
DECEMBER 18,

1964.

167

SUMMARY OF REPORT BY ATTORNEY GENERAL

This proposed merger would provide the means by
which the largest bank in northern Alabama could
effect an entrance into a heretofore relatively wellbalanced banking market. The smaller bank, First
National Bank in Gadsden, is the second largest in
the five-bank Gadsden market and enjoys about onefourth of Gadsden's banking business. The larger
bank, State National Bank of Alabama, is headquartered in Decatur, about 90 miles northwest of
Gadsden, and 18 banking offices stretching across the
the northern part of Alabama. State National Bank
has branches in 11 northern Alabama counties. It is
the only bank in the State of Alabama which has

branches outside the county of its main office and is the
only bank permitted by State law to do so. Were the
proposed merger to take place, the resulting institution
would be over 2J4 times the size of all of the remaining five Gadsden banks combined. Such size would
give the resulting bank a significant competitive advantage over the remaining banks in Gadsden, particularly since the economy of that city is subject to
wide economic swings. Thus, the proposed merger is
likely to increase the concentration in banking in
Gadsden and to unbalance badly what now appears
to be an adequately fragmented market. Accordingly,
the merger of these institutions is likely to have seriously adverse effects on banking competition in the
Gadsden area.

THE SCIOTO BANK, COMMERCIAL POINT, OHIO, AND THE FIRST NATIONAL BANK OF CIRCLEVILLE, CIRCLEVILLE
OHIO
Banking offices
Name of bank and type of transaction

Total assets
In
operation

The Scioto Bank, Commercial Point, Ohio, with
and the First National Bank of Circleville, Circleville, Ohio (118), which had.
merged Dec. 29, 1964, under the charter and title of the latter bank (118).
The merged bank at the date of merger had

COMPTROLLER S DECISION

On October 21, 1964, the $580,000 Scioto Bank,
Commercial Point, Ohio, and the $9.1 million First
National Bank of Circleville, Circleville, Ohio, applied to the Comptroller of the Currency to merge
under the charter and with the title of the latter.
Circleville, the county seat of Pickaway County, has
a population of 11,585 and a service area population
of 30,000. This community, which is located 26 miles
south of Columbus, Ohio, has a diversified economy
based on agriculture and industry. Agricultural activities are mainly the raising of corn, hogs, and beef
cattle. Industrial activities have considerably expanded in the area in the past decade with a concomitant residential expansion.
Commercial Point, the site of the merging bank,
had a population of 308 in 1960 and is totally dependent on agriculture for its economic support.
The merger will not significantly affect the banking services offered in Circleville since the addition
of the half-million dollars of assets resulting from the
merger will have only a slight effect on the charter
168




$593, 387
9,526,219

To be
operated
1
2

10,119,606

3

bank and its position in relation to its competitors in
the area. The charter bank receives competition from
the $5.3 million Second National Bank of Circleville,
the $6.6 million Third National Bank of Circleville
and the $5 million Savings Bank, Circleville.
The merging bank is located 16 miles northwest of
the charter bank and does not compete for either deposits or loans with the First National. Consequently,
the merger will not adversely effect competition in
either bank's service area. Indeed the merger will have
a salutary effect on the banking structure of Commercial Point.
Applying the statutory criteria to the proposed merger, we conclude that it is in the public interest and the
application is, therefore, approved.
DECEMBER 22,1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

The First National Bank of Circleville, Circleville,
Ohio, with deposits of $8.2 million and loans of $5.3
million is the largest bank in an area which has 15
competing banks. First National's deposits and loans
are about 17 to 18 percent of the 15 bank totals.

The Scioto Bank with deposits of $498,000 and loans
of $262,000 is the smallest of the 15 banks, its share of
the total deposits and loans amounting to approximately 1 percent.
The merger would eliminate the Scioto Bank as a
competitor and would eliminate the competition pres-

ently existing between Scioto and First National.
However, in view of the Scioto's very limited resources,
the small amount of business it handles, and the range
of banking alternatives which will still be open to
customers, we conclude that the merger would not have
any significantly adverse effect upon competition.

THE COMMERCIAL NATIONAL BANK OF SPARTANBURG, SPARTANBURG, S.C., AND THE FIRST NATIONAL BANK OF
SOUTH CAROLINA OF COLUMBIA, COLUMBIA, S.C.
Banking offices
Total assets

Name of bank and type of transaction

The Commercial National Bank of Spartanburg, Spartanburg, S.C. (14211), with,
and the First National Bank of South Carolina of Columbia, Columbia, S.C.
(13720) which had
merged Dec. 31, 1964, under charter of the First National Bank of South
Carolina of Columbia (13720), and under title "The First Commercial
National Bank of South Carolina." The merged bank at the date of merger
had
COMPTROLLER'S DECISION

On October 12, 1964, the $31.8 million Commercial
National Bank of Spartanburg, Spartanburg, S.C, and
the $118.3 million First National Bank of South Carolina of Columbia, Columbia, S.C, applied to the
Comptroller of the Currency for permission to merge
under the charter of the latter and with the title
of the First Commercial National Bank of South Carolina.
Columbia, capital of South Carolina with a population of approximately 260,828, has the second largest
market for exchange of agricultural products in the
southeast. The city has experienced significant expansion in its economic development during the past 10
years as evidenced by a population increase of more
than 40 percent, postal receipts increase of 120 percent and department store sale increase of approximately 60 percent. There has also been an influx of
large industries. More than 49,000 persons are employed in manufacturing, trade, transportation, finance, insurance, and other business activities in the
area.
The charter bank, organized in 1933, now operates
26 offices in 11 communities in various sections of the
State. In addition to Columbia, the other large metropolitan area in which First National operates is Charleston with an area population of 254,758 located in the
southeastern section of the State. The other towns in
which First National operates range in population from




In
operation

To be
operated

$35,125, 953

9

131, 858, 382

24

165,050,102

33

1,587 to 41,316. The economy of most of these areas is
supported primarily by textile manufacturing, diversified industry, and agricultural activities. U.S. Government employment is an important economic factor in
the Charleston and Columbia areas.
In applying the statutory criteria to the instant proposal, we conclude that it is in the public interest and
the application is, therefore, approved.
DECEMBER 29, 1964.
SUMMARY OF REPORT BY ATTORNEY GENERAL

This is an application by the third largest commercial bank in the South Carolina to merge with a substantial independent bank in what would constitute
its largest acquisition. The Charter Bank has an announced policy of expanding by merger and it owes
the larger part of its recent growth to its acquisition
of eight banks during the past decade.
The 4 largest banks in South Carolina have acquired
some 27 banks during the past 10 years. This acquisition trend, which shows no signs of abating, has contributed to the very high degree to which the commercial banking resources of South Carolina are
concentrated in the hands of the few dominant statewide institutions. This trend, which we have pointed
out in prior reports, threatens the continued existence
of independent banks and their significance as factors
in competition.
The proposed merger would eliminate a nine-office
bank, with deposits of $28 million, as an independent
169

institution. It would contribute materially to the resources of the Charter Bank. It would also increase
the competitive disadvantage of several smaller banks
which now compete with branches of the Merging
Bank.
Implicit in this proposed merger is the view that
there is no future for independent banks in South Carolina. For if so large an independent as the Merging
Bank may be acquired by the State's third largest bank,
it is hard to see how the many smaller independents can
be expected to constitute a vital competitive force or
even to survive for very long. Indeed, the application

states that the necessary growth of banks "can be accomplished only through such mergers as this" (at
p. 49).
In light of the history of bank mergers in South
Carolina, this proposed merger may encourage still
further acquisitions and thus aggravate the tendency
toward monopoly in commercial banking in South
Carolina.
For these reasons, it is our opinion that the consummation of the proposed merger would have a significantly adverse effect upon competition in commercial
banking in South Carolina.

THE WINDSOR COUNTY NATIONAL BANK OF WINDSOR, WINDSOR, VT., AND VERMONT NATIONAL & SAVINGS
BANK, BRATTLEBORO, VT.
Banking offices
Name of bank and type of transaction

Total assets

The Windsor County National Bank of Windsor, Windsor, Vt. (13685), with
and Vermont National & Savings Bank, Brattleboro, Brattleboro, Vt. (1430),
which had
merged Dec. 31, 1964, under charter of the latter bank (1430) and title
"Vermont National Bank." The merged bank at the date of merger had..

COMPTROLLER S DECISION

On November 16, 1964, the $44.6 million Vermont
National & Savings Bank, Brattleboro, Vt., and the
$5.0 million Windsor County National Bank of Windsor, Windsor, Vt., applied to the Comptroller of the
Currency for permission to merge under the charter
and title of the former.
Brattleboro, with a population of 9,000 and situated
between the Green Mountains and the Connecticut
River, is the chief trading center of southeastern Vermont, southwestern New Hampshire and adjacent territory in Massachusetts. The retail trade area consists
of 60,000 people supported by various manufacturing
establishments including machine tools, leather, paper
and wood products.
Windsor, with a population of 4,000, is located on
the Connecticut River at the foot of Ascutney Mountain about 55 miles north of Brattleboro. The town
serves a trade area of about 25,000 persons located in
nearby Vermont and New Hampshire towns. The
largest employers in the area are machinery and rubber products manufacturing plants and the Vermont
State Prison.
The charter bank ranks fifth in size among the bank170




In
operation

To be
operated

$5, 659, 651

2

44, 284, 550

10

49, 964, 477

12

ing institutions serving the State of Vermont. With
its main office in Brattleboro and nine branches, the
bank serves the southern border of the State and an
area extending northward along the Connecticut River
to the town of Woodstock, a distance of some 65 miles.
The charter bank is substantially smaller than the largest bank in Vermont, the $103 million Burlington
Savings Bank, Burlington, as well as the $67 million
Chittenden Trust Co., Burlington. After the merger
is consummated, the resulting bank will still be smaller
than the largest bank in Brattleboro, the $54 million
Vermont Bank & Trust Co. Competition for savings
dollars also comes from sa.vings and loan associations
and credit unions.
The proposed merger will provide, along with the
addition of progressive management, many banking
services for the town of Windsor which are not available at the present time. These benefits will include
increased capacity, the initiation of trust services and
certain financing, such as large participation loans,
consumer credit financing, business and mortgage loans
not now offered by the merging bank.
Applying the statutory criteria to this proposal, this
application is hereby approved.
DECEMBER 29,1964.

SUMMARY OF REPORT BY ATTORNEY GENERAL
__ . 1 O .
r>,r-^
if
Vermont National & O
Savmsrs Bank of Brattleboro,
Vt., fifth largest Vermont bank, with nine branches,
including one at Windsor, and assets of $44,571,000
proposes to merge the Windsor County National Bank
of Windsor, Vt., with one branch and assets of
$5,021,000.
The proposed merger would eliminate a small independent bank and all existing competition in WindXT




sor, Vt., between it and the acquiring bank would jeopardize the ability of a small bank in Ludlow to con.
«. • ,
r •,
toue
tO C O m e t e effectlvel
P
y> a n d w o u l d t e n d t 0 e n "
coura e a trend toward
S
concentration of banking m
an area where
approximately 25 small independent
banks continue to function.
We conclude, therefore, that the proposed acquisition would have a serious adverse effect upon
competition.

171




APPENDIX B

Statistical Tables

INDEX
Statistical Tables
Table No.

B-l
B-2

B-3

B-4

B-5
B-6

B-7

B-8
B-9
B-10

B-ll

B-l 2

B-l 3

Title

Page

Comptrollers of the Currency, by dates of appointment and resignation, and States from
which appointed
175
Administrative Assistants to the Comptroller of
the Currency and Deputy Comptrollers of the
Currency, by dates of appointment and resignation, and native States
176
Changes in the structure of the National Banking
System, by States, since 1863: number of banks
organized, consolidated, and merged; number
of insolvencies, liquidations, and conversions;
and national banks in existence, December 31,
1964
177
Applications for new national bank charters, approved and rejected, with name of bank and date
of approval or rejection, calendar 1964, by
States
178
National banks chartered during calendar 1964:
by charter number, title and location, States,
and total capital account
182
State chartered banks converted to national
banks during calendar 1964, by title ana location of bank, State, effective date, outstanding
capital stock, surplus, undivided profits and
reserves, and total assets
188
National banks reported in voluntary liquidation
during calendar 1964 with the names of succeeding banks, the dates of liquidation, and
total capital accounts
189
National banks merged or consolidated with and
into State banks during calendar 1964, with
effective dates, and total capital accounts
189
National banks converted into State banks, calendar 1964, with effective date, and total capital accounts
190
Purchases of State banks by national banks,
calendar 1964, with title and location, effective
dates of purchase, and total capital accounts
of State banks
190
Consolidations of national banks, or national
and State banks, calendar 1964, with title and
location, outstanding capital stock, surplus,
undivided profits and reserves, and to talassets. 191
Mergers of national banks, or national and State
banks, calendar 1964, with title and location,
outstanding capital stock, surplus, undivided
profits and reserves, and total assets
192
Number of domestic branches of national banks
opened for business, calendar 1964, by States,
banks, and type of branch
199

174




Table No.

Title

B-l4 Number of domestic branches of national banks
closed, calendar 1964, by States, banks, and
type of branch
B-l 5 Principal assets and liabilities of national banks,
by deposit size, December 1963 and 1964
B-l 6 Dates of reports of condition of national banks,
1914 to 1964
B-l 7 Number, total, and principal assets, liabilities,
and capital accounts of national banks, by
States, June 30, 1964
B-l 8 Number, total, and principal assets, liabilities,
and capital accounts of national banks, by
States, December 31,1964
B—19 Selected loans and discounts of national banks,
by States, December 31, 1964
B-20 Selected U.S. Government obligations held by
national banks, by States, December 31, 1964.
B-21 Bank trust assets and income by States
B-22 Common trust funds by States, 1963 and 1964.
B-23 Current operating revenue, expenses, and dividends of national banks, by major categories
and States, year ended December 31, 1964..
B—24 Current operating revenue, expenses, and dividends of national banks in the United States
and possessions operating throughout calendar
1964, by size of deposits, December 1964
B-25 Current operating revenue, expenses, and dividends of national banks, years ended December
31, 1963 and 1964
B-26 Number of national banks, capital stock and
accounts, net profits, dividends, and ratios to
capital accounts, years ended December 31,
1944-64
B-27 Total loans of national banks, losses and recoveries on loans, and ratio of net losses or
recoveries to loans, by calendar years, 1945-64.
B-28 Total securities of national banks, losses and
recoveries on securities., and ratio of net losses
or recoveries to securities, by calendar years,
1945-64
B-29 Foreign branches of national banks, by region
and country, March 31, 1965
B-30 Foreign branches of national banks, 1955-1964.
B-31 Assets and liabilities of foreign branches of
national banks, December 31, 1964: consolidated statement
B-32 Assets and liabilities of all national banks, date
of last report of condition, December 1936-64.

Page

207
209
210

212
215
218
219
220
221
222

230
232

235
236

236
237
237
237
238

TABLE B-l.—Comptrollers of the Currency, by dates of appointment and resignation, and states from which appointed
Mo.

Name

McCulloch, Hugh
Clarke, Freeman
..
Hulburd, Hiland R
Knox, John Jay
Gannon, Henry W
Trenholm, William L. . .
Lacey, Edward S
Hepburn, A. Barton....
Eckels, James H
Dawes, Charles G. . . . . .
Ridgely, William Barret.
Murray, Lawrence O . , .
Williams, John Skel
Grissinger, D. R
Dawes, Henry M
Mclntosh, Joseph W. . . .
Pole, John W
O'Connor, J. F. T
Delano, Preston
Gidney, Ray M
Saxon, James J

Date of
appointment

May
Mar.
Feb.
Apr.
May
Apr.
May
Aug.
Apr.
Jan.
Oct.
Apr.
Feb.
Mar.
May
Dec.
Nov.
May
Oct.
Apr.
Nov.

9,1863
21, 1865
1,1867
25,1872
12, 1884
20,1886
1,1889
2,1892
26,1893
1,1898
1,1901
27,1908
2,1914
17, 1921
1,1923
20, 1924
21,1928
11,1933
24,1938
16,1953
16,1961

Date of
resignation

Mar. 8, 1865
July 24, 1866
Apr. 3, 1872
Apr. 30, 1884
Mar. 1, 1886
Apr. 30, 1889
June 30, 1892
Apr. 25, 1893
Dec. 31, 1897
Sept. 30, 1901
Mar. 28, 1908
Apr. 27, 19131
Mar. 2, 1921
Apr. 30, 1923
Dec. 17, 1924
Nov. 20, 1928
Sept. 20, 1932
Apr. 16, 1938
Feb. 15, 1953
Nov. 15, 1961

State

Indiana
New York
Ohio
Minnesota
Minnesota
South Carolina
Michigan
New York
Illinois
Illinois
Illinois
New York
Virginia
Ohio
Illinois
Illinois
Ohio
California
Massachusetts
Ohio
Illinois

i Term expired.




175

TABLE B-2.—Administrative Assistants to the Comptroller oj the Currency and Deputy Comptrollers of the Currency, by the
dates of appointment and resignation, and native states
Nat

Date of
appointment

Date of
resignation

State

ADMINISTRATIVE ASSISTANTS TO THE COMPTROLLER

Larsen, Arnold E . .
Faulstich, Albert J .

Dec. 24, 1961 July 1, 19621
July 2, 1962

Nebraska
Louisiana

DEPUTY COMPTROLLERS OF THE CURRENCY

Howard, Samuel T. .
Hulburd, HilandR. .
Knox, John Jay
Langworthy, John S.
Snyder, V. P
Abrahams, J. D
Nixon, R. M
Tucker, Oliver P. . . .
Coffin, George M.
Murray, Lawrence O.
Kane, Thomas P
Fowler, Willis J .
Mclntosh, Joseph W
Collins, Charles W
Stearns, E.W
Await, F. G
Gough, E. H
Proctor, John L
Lyons, Gibbs
Prentiss, William, Jr
Diggs, Marshall R
Oppegard, G. J
Upham, C. B
Mulroney, A. J
McCandless, R. B
Sedlacek, L. H
Robertson, J. L
Hudspeth, J. W
Jennings, L. A
Taylor, W. M
Garwood, G. W
Fleming, Chapman C
Haggard, Hollis S
Camp, William B
Redman, Clarence B
Watson, Justin T
Miller, Dean E
DeShazo, Thomas G
Egertson R. Coleman
Blanchard, Richard J
Park, Radcliffe

New York
Ohio
Minnesota
New York
New York
Virginia
Indiana
Kentucky
South Carolina
New York
Dist of Col.
Indiana
Illinois
Illinois
Virginia
Maryland
Indiana
Washington
Georgia
California
Texas
California
Iowa
Iowa
Iowa
Nebraska
Nebraska
Texas
New York
Virginia
Colorado
Ohio
Missouri
Texas
Oct. 26, 1963 Connecticut
Ohio
Iowa
Virginia
Iowa
Massachusetts
Wisconsin

Aug. 1, 1865
Jan. 31, 1867
Apr. 24, 1872
Jan. 3, 1886
Jan. 3, 1887
M a y 25, 1890
Mar. 16, 1893
Mar. 11, 1896
Aug. 31, 1898
June 27, 1899
Mar. 2, 1923*
Feb. 14, 1927
Dec. 19, 1924
June 30, 1927
Nov. 30, 1928
Feb. 15, 1936
Oct. 16, 1941
Jan. 23, 1933
Jan. 15, 1938
Jan. 15, 1938
Sept. 30, 1938
Sept. 30, 1938
Dec. 31, 1948
Aug. 31, 1941
Mar. 1, 1951
Sept. 30, 1944
Feb. 17, 1952
Aug. 31, 1950
M a y 16, 1960
Apr. 1, 1962
Dec. 31, 1962
Aug. 31, 1962
Aug. 3, 1962

1
Appointed Regional Comptroller of the Currency with headquarters in San Francisco, Calif.
2 Died Mar. 2, 1923.

176




TABLE B-3.—Changes in the structure of the National Banking System, by States, since 1863: number of banks organized,
consolidated, and merged; number of insolvencies, liquidations, and conversions; and national banks in excistence, Dec. 31, 1964

Organized 1863
through
1964

State

United States *
Alabama
Alaska
Arizona
Arkansas
California
,
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersev
New Mexico.
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands
Puerto Rico

Consolidated and merged
under 12 I J.S.C. 215

12 U.S.C. 214
Insolvent In liquidation

In existence
Merged or Dec. 31
consolidated 1964
with State
banks

,

,
,
. .

,

,

,

,,

,

Mergers

15, 466

,

Consolidations

678

209

2815

6, 701

57

227

4, 779

193
8
32
158
590
259
131
32
36
272
196
7
112
959
443
559
453
250
120
127
155
380
346
510
86
315
203
410
17
82
431
96
1,009
157
263
710
775
150
1,286
67
131
221
217
1,312
44
85
272
238
196
287
76
1
1

4
0
1
1
19
5
11
0
8
2
8
1
0
19
14
4
6
11
4
7

2
0
0
0
17

45

62
2
21
55
383
84
69
18
13
41
87
4
65
296
205
243
198
110
53
79
69
207
156
192
34
148
76
199
8
23
150
37
439
58
118
333
454
102
488
58
49
81
94
572
19
29
74
136
68
115
26
0
1

0
0
0
0
2

0
1
0
0
13
0
13
8
0
0
0
0
2
1
1
0

80
5
4
63
91
115
27
5
8
187
55
2
9
412
124
101
169
82
47
22
49
93
96
193
31
93
48
125
3
50
146
33
204
31
42
221
223
11
388
4
24
33
75
538
12
27
123
28
79
109
38
1
0

37
11
8
5
12
3
2
1
3
48
1
122
8
3
32
12
2
97
3
8
13
8
45
4
3
21
18
11
9
0
0
0

o
4
0
0
0

o

0
1
2
1
0

o
2
0
5
10
6
3

o
o

1
0
0
0
1
11
0
45
8
0
7
0
2
45
0
7
0

o
0
0
2
22

5
0
0
0
0
0

o
6
39
65
55
1
7
42
42
0
35
227
98
205
76
37
16
13
17
28
77
116
16
58
76
83
4
5
59
25
130
44
100
112
85
31
211
2
43
93
36
142
6
17
28
51
38
54
12
0
0

to State
banks

o

0
0
0
0
4
0
0
2
0
6
4
7
0
0

o
0
o
1
o

2
0
1
0
0
1
0
4
0
0
1
1
0
2
0
0
1
2
14
1
1
0
0
0
0
0
0
0

o
1
0
1
7
9
3
0

o

1
0
0
1
0
16
0
65
8
0
4
0
2

55
0
0
0
2
1
2
6
4
0
0
0
0
0
0

* Includes Virgin Islands and Puerto Rico.




177

TABLE B-4.—Applications for new national bank charters, approved and rejected, with name of bank and date of approval or
rejection, calendar 1964, by States
Alabama

City National Bank of Russellville, Russellville, Ala
Florence, Ala
Capitol National Bank of Montgomery,
Montgomery, Ala
Baldwin National Bank of Robertsdale,
Robertsdale, Ala. (Conversion)
Shoals National Bank of Florence, Florence, Ala
City National Bank of Birmingham, Birmingham, Ala
Muscle Shoals National Bank, Muscle
Shoals, Ala
First National Bank of Aliceville, Aliceville, Ala
Opp National Bank, Opp, Ala
Lineville, Ala
City National Bank of Gadsden, Gadsden,
Ala
The National Bank of Mobile County,
Prichard, Ala
Mobile, Ala
Tallassee, Ala
Decatur, Ala

Approved Rejected
1964
1964

Feb. 22

Mar. 5

Mar. 27
Mar. 31
Apr. 15
May 27
June 3
Sept. 3
Sept. 4

Sept. 29

Nov. 2
Dec. 4

Dec. 14
Dec. 16
Dec. 31

Arkansas

First National Bank in Osceola, Osceola,
Ark. (Conversion)
Feb. 22
Pine Bluff National Bank, Pine Bluff, Ark. May 8
First National Bank of Brinkley, Brinkley,
Ark
May 12
Jacksonville, Ark
June 3
Sheridan, Ark
July 22
California

Riverside, Calif
Pacific Industrial National Bank of South
El Monte, South El Monte, Calif
San Joaquin Valley National Bank, Tulare, Calif
Indio, Calif
Pasadena, Calif
Visalia, Calif
Bellfiower, Calif
Fremont, Calif
Sherman Oaks, Calif
Republic National Bank of San Diego,
San Diego, Calif
Silverlake National Bank, Los Angeles,
Calif
Sunland, Calif
Los Angeles, Calif
Inyo-Mono National Bank, Bishop, Calif.
Thousand Oaks, Calif
Riverside National Bank, Riverside, Calif.
Los Angeles, Calif
Bakersfield National Bank, Bakersfield,
Calif
Commercial National Bank, Anaheim,
Calif
Lodi National Bank, Lodi, Calif
Concord National Bank, Concord, Calif.
Santa Cruz, Calif
Escondido National Bank, Escondido,
Calif
Escondido, Calif
Heritage National Bank, Westwood, Calif.
Westminster, Calif
Commercial National Bank of San Leandro, San Leandro, Calif
Huntington Park, Calif
Whittier, Calif
National Bank of Whittier, Whittier,
Calif

178




Jan. 14
Jan. 15
Jan. 21

Jan.
Jan.
Jan.
Jan.
Feb.
Feb.

21
22
22
24
1
8

Feb. 15
Feb. 15
Feb. 25
Mar. 13

Feb. 22
Feb. 25
Mar. 13
Mar. 23

Mar. 30
Mar. 30
Mar. 30
Apr. 2
Apr. 8
Apr. 21
Apr. 23
May 11

June 1

Apr. 21
Apr. 29
May 14
June 1

California—Continued
Lincoln National Bank, Santa Rosa, Calif.
Valley National Bank of Delano, Delano,
Calif
Santa Rosa, Calif
Redding, Calif
Westminster National Bank, Westminster,
Calif
Sonoma, Calif
Bellfiower National Bank, Bellfiower,
Calif
Mechanics National Bank, Huntington
Park, Calif
San Francisco, Calif
Pacific Palisades, Calif
Fisherman's National Bank, San Francisco, Calif
Sacramento, Calif
Sacramento, Calif
Sacramento, Calif
Los Angeles, Calif
Los Angeles, Calif
Southland National Bank, Yucaipa,
Calif
...
Fullerton, Calif
University National Bank, Fullerton,
Calif
Los Angeles, Calif
First National Bank of Washington
Township, Union City, Calif
Ukiah, Calif
Pan American National Bank of East Los
Angeles, Los Angeles, Calif
Martinez, Calif
Lakewood, Calif
Republic National Bank, Los Angeles,
Calif
Victorville, Calif
Commercial and Farmers National Bank,
Oxnard, Calif
Bank of Long Beach, National Association, Long Beach, Calif
Signal Hill, Calif
Santa Clarita National Bank, Newhall,
Calif
Imperial Valley National Bank, El Centro, Calif
Sonoma, Calif
Stockton, Calif
Oakland, Calif
Visalia, Calif
Stockton, Calif
Paramount, Calif
Los Angeles, Calif
Los Angeles, Calif
San Bernardino, Calif
San Francisco, Calif
«
Walnut, Calif
LaHabra, Calif
Los Angeles, Calif
Mountain View, Calif
Hacienda Heights, Calif
Montebello, Calif
Modesto, Calif
Casitas National Bank, Carpinteria, Calif.
San Pedro, Calif
San Pedro, Calif

Approved Rejected
1964
1964

June 3
June 3

June 3
June 24

June 24
June 29
July

2

July

2
July 20
Aug. 31

Aug. 31
Sept." 3
Sept. 3
Sept. 3
Sept. 3
Sept. 3
Sept. 11
Sept. 22
Sept. 29

Sept. 22
Sept. 29
Sept.* 29

Sept. 29
Oct. 12
Nov. 6
Dec. 4
Dec. 4
Dec. 4
Dec. 10
Dec. 10
Dec. 10
Dec. 10
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec. 22

10
11
11
11
11
11
11
11
14
14
14
14
14
16
16
17
22

Dec. 29
Dec. 29

Colorado

Delta, Colo
Jan. 3
The First National Bank of Bear Valley,
Denver, Colo
Jan. 27
National Bank of Delta, Delta, Colo
Feb. 1
Leadville, Colo
Apr. 7
Colorado Springs, Colo
Apr. 8

TABLE B-4.—Applications for new national bank charters, approved and rejected, with name of bank and date of approval or
rejection, calendar 1964, by States—Continued
Colorado—Continued
Wheat Ridge, Colo
Denver, Colo
The Western National Bank of Colorado
Springs, Colorado Springs, Colo
Englewood, Colo
The East Colorado Springs National Bank,
Colorado Springs, Colo
Colorado Springs, Colo
Metropolitan National Bank, Denver,
Colo
Midtown National Bank, Pueblo, Colo...
Wheat Ridge, Colo
First National Bank of Southglenn, Arapahoe County, Colo
Breckenridge, Colo
Craig, Colo
First National Bank of Estes Park, Estes
Park, Colo
Westlake First National Bank, Loveland,
Colo
Loveland, Colo
,
Grand Valley, Colo
Pueblo, Colo
Jefferson County, Colo
Villa Italia, Colo
Westminster, Colo
Edgewater, Colo
Englewood, Colo
Denver, Colo

Approved Rejected
7964
1964

Apr. 21
Apr. 30
May 11

May 27

June 24
June 24

June 24
Jul 7
ily
July 27

July 17
Aug. 31
Aug. 31

Sept. 3
Sept. 3
Sept.
Sept.
Oct.
Oct.
Oct.
Oct.
Dec.
Dec.
Dec.

10
11
12
14
14
16
11
17
18

Connecticut

Rocky Hill, Conn . . . .
Apr. 21
The Hamden National Bank, Harnden,
Conn
June 24
Citizens National Bank of Southington,
Southington, Conn
Oct. 12
The Constitution National Bank, Hartford, Conn
Oct. 16
Dec. 10
Manchester, Conn
Dec. 17
East Hartford, Conn
District <,f Columbia

United Community
Washington, D.C
Washington, D.C

National

Bank,

Feb.




Jan.

Feb.

Jan. 16
Jan. 18
Feb. 15
Feb. 22

Mar. 6
Mar. 10
Mar. 13
Mar. 19
..
May 26
June 4

Manufacturers National Bank of Hialeah,
Hialeah, Fla
West Palm Beach, Fla
Edgewater, Fla
Volusia County National Bank at
Ormond Beach, Ormond Beach, Fla..
University National Bank of Boca Raton,
Boca Raton, Fla
First Bank & Trust Co. of Boca Raton,
National Association, Boca Raton, Fla.
(Conversion)
Interamerican National Bank at Sunny
Isles, Sunny Isles, Fla
Fort Lauderdale, Fla
Republic National Bank of Miami, Miami,
Fla
Orlando, Fla
Rockledge, Fla
Cocoa Beach, Fla
West Melbourne, Fla
National Bank of WTest Melbourne, West
Melbourne, Fla
Gainesville, Fla
Fort Lauderdale, Fla
North Bay Village, Fla
Highway #441, Dade County, Fla
Cocoa Beach, Fla
Brooksville, Fla
Orlando, Fla
Fort Lauderdale, Fla
Unincorporated, Orange County, Fla
Fort Lauderdale, Fla . ,
Miami, Fla
St. Petersburg, Fla
Edgewater, Fla
West of Lake Worth, Palm Beach Co.,
Fla
Pensacola, Fla
Merritt Island, Fla
Miami, Fla
Miami. Fla
Miami Beach, Fla

Approved Rejected
7964
7964

June 30

July 2
July 28

July 31
Aug. 18
Aug. 18
Aug. 21
Sept. 4

Oct.

6

Sept. 4
Sept. 16
Sept. 22
Sept. 24
Oct. 6
Oct.
Oct.
Oct.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.
Dec.

14
14
30
7
10
10
11
14
14
14
15
16
17

Dec.
Dec.
Dec.
Dec.
Dec.
Dec.

18
22
22
29
30
31

Georgia

Dec. 15

Florida

United National Bank, Miami, Fla
Port Richey, Fla
Miami, Fla.
Lincoln National Bank of Miami, Miami,
Fla
St. Petersburg, Fla
Crestview, Fla. (Conversion)
Capital National Bank of Miami, Miami,
Fla. (Conversion)
National Bank of Melbourne & Trust
Co., Melbourne, Fla. (Conversion)
Westchester National Bank of Dade
County, Dade County., Fla
The Second National Bank of North
Miami, North Miami, Fla
Tampa, Fla
Homestead, Fla
Sanford, Fla.
Hollywood, Fla
First National Bank of PrincetonNaranja, Princeton-Naranja, Fla
Ormond Beach, Fla
Peoples National Bank of Bay Harbor
Islands, Bay Harbor Islands, Fla
Port Richey, Fla
Sunny Isles area of Dade County, Fla...

Florida—Continued

Apr.
Apr.
May
May

17
30
1
15

June

3

June 24
June 25

First National Bank of Perry, Perry, Ga. . Mar. 19
Roswell, Ga
May 26
Jonesboro, Ga
May 26
Tucker, Ga
July 2
The First National Bank of Tucker,
Tucker, Ga
Dec. 4
Atlanta, Ga
Dec. 4
Roswell, Ga
Dec. 14
Illinois

First National Bank of Mount Prospect,
Mount Prospect, 111. (Conversion)
Pesotum, 111
Midwest National Bank of Moline, Moline, 111
American National Bank of Champaign,
Champaign, 111
North Towne National Bank of Rockford,
Rockford, 111
Seaway National Bank of Chicago, Chicago, 111
The First National Bank of Western
Springs, Western Springs, 111. (Conversion)
Pekin, 111.
Community National Bank in Monmouth, Monmouth, 111
Normal, 111

Jan.

3

Jan. 16

Feb. 22
Mar 13
Mar 21
May 11
May 11
May 26

May 11
June 4
179

TABLE B-4.—-Applicationsfor new national bank charters, approved and rejected, with name of bank and date of approval or
rejection, calendar 1964, by States—Continued
Approved Rejected
1964
Illinois—Continued
1964
Mid-West National Bank of Lake Forest,
Lake Forest, 111
July 2
The First National Bank of Lake Bluff,
Lake Bluff, 111
July 31
First National Bank of Macomb, Macomb, 111
Aug. 18
Pekin National Bank, Pekin, 111
Aug. 31
Berkeley, 111
Dec. 18
First National Bank of Oak Lawn, Oak
Lawn, 111. (Conversion)
Dec. 18
Freeport, 111
Dec. 31
Indiana
First National Bank of Hartford City,
Hartford City, Ind
June 24
Bank cf Indiana, National Association,
Gary, Ind. (Conversion)
Nov. 24
Iowa
First National Bank, Ames, Iowa, (Conversion)

Dec. 16

w

Kansas
Salina, Kans
City National Bank of Pittsburg, Pittsburg,
Kans
Sabetha, Kans
Overland Park, Kans
Louisiana
First National Bank of Denham Springs,
Denham Springs, La
Bogalusa, La
Morgan City, La
Luling, La
Maryland
University National Bank, College Park,
Md
The Old Line National Bank, Rockville,
Md
Takoma Park, Md
Greenbelt, Md

Apr. 21
Sept. 2
Dec. 10
Dec. 11

Mar. 27
Sept. 30
Dec. 14
Dec. 18

Apr. 22
Aug. 21
Sept. 10
Dec. 14

Massachusetts
Commonwealth National Bank, Boston,
Mass
Harbor National Bank of Boston, Boston,
Mass

Feb. 29
June 25

Michigan
First National Bank of Wyoming,
Wyoming, Mich. (Conversion)
Imlay City, Mich
First National Bank of Fenton, Fenton,
Mich
Grand Valley National Bank, Grandville,
Mich
City Bank & Trust Co., National Association, Jackson, Mich. (Conversion).. .
Valley National Bank ot Sagmaw. °-~ :
valley iNational JBanic of Sagimr" Saginaw, Mich. (Conversion). . . . . . . . . .
Central National Bank of St. Johns, Ovid,
Mich. (Conversion)....
Livonia National Bank, Livonia, Mich.,
(Conversion)

180




Approved Rejected
1964
1964
May 15
Dec. 14

Mississippi
First National Bank of Clarksdale, Clarksdale, Miss
Jan. 27
First National Bank of Iuka, Iuka, Miss.. Mar. 30
First National Bank of Greenwood, Greenwood, Miss
Aug. 18
Calhoun City, Miss
Dec. 14
First Citizens National Bank, Tupelo,
Miss. (Conversion)
Dec. 30
Missouri
The First National Bank of Sikeston,
Sikeston, Mo. (Conversion)
Security National Bank of Sikeston, Sikeston, Mo
Gateway National Bank of St. Louis, St.
Louis, Mo
First National Bank of Annapolis, Annapolis, Mo
Fredericktown, Mo
First National Bank of Sullivan, Sullivan, Mo
First National Bank of Maiden, Maiden,
Mo
Kansas City, Mo
Southwest National Bank of Kansas City,
Kansas City, Mo
Union, Mo
Lee's Summit, Mo
Sunset Hills, Mo
Mercantile Trust Company National Association, St. Louis, Mo. (Conversion).
St. Louis, Mo
West Side National Bank, Unincorporated
Area, St. Louis County, Mo
Aurora, Mo
Kansas City, Mo
Montana
Missoula, Mont
First National Bank of Eureka, Eureka,
Mont
First National Bank, West Yellowstone,
Mont
West Yellowstone, Mont
Conrad, Mont
Malta, Mont

June 30

Nebraska
City National Bank of Lincoln, Lincoln,
Nebr
Security National Bank of Omaha,
Omaha, Nebr
West Omaha National Bank, Omaha,
Nebr
Sarpy County, Nebr

July 10

Feb. 18
Mar. 19
May 11
May 13
May 15
July 20
Aug. 31
Sept. 2
Sept. 2
Oct. 12
Oct. 12
Oct. 14
Nov. 13
Dec.

4

Dec. 10
Dec. 11
Dec. 11
Jan. 21
Apr.

8

Aug. 21
Aug. 21
Oct. 12
Dec. 30

Nevada

Jan. 17
May 1
June 24

Aug. 17
Aug31
Oct. 15

Minnesota
East Grand Forks, Minn
Valley National Bank of Le Sueur, Le
Sueur, Minn. (Conversion)
St. Louis Park, Minn
Lake City, Minn

Minnesota—Continued
Farmington, Minn
Mankato, Minn

Jan. 18
Feb. 28
May 11
May 11

Feb. 22
Apr.

2

Aug. 18
Dec. 11

Las Vegas, Nev
Apr. 2
^
y^""' -;--*"• ^as Vegas, Nev
June 29
parson City, Nev
July 20
Carson City, Nev
Sept. 2
New Hampshire
The Indian Head National Bank of Manchester, Manchester, N.H. (Conversion)
June 30
New Jersey
Madison National Bank, Madison, N.J...
First National Bank of Scotch Plains,
Scotch Plains, N J

Feb.

1

Feb. 22

T A B L E B-4.—Applications for new national bank charters, approved and rejected, with name of bank and date of approval or
rejection, calendar 1964, by States—-Continued
New Jersey—Continued
New Jersey National Bank & Trust Co.,
Asbury Park, N.J. (Conversion)
Eatontown National Bank, Eatontown,
N.J
Eatontown, N.J
Raritan Valley National Bank, Edison
Township, N.J
Security National Bank, Newark, N.J
First National Bank of Moorestown,
Moorestown, N.J
North Jersey National Bank, Fort Lee,
N.J
First National Bank of Bridgewater,
Bridgewater Township, N.J
Englewood National Bank & Trust Co.,
Englewood, N.J
Springfield, N.J
Springfield, N.J

Approved Rejected
1964
1964
Feb. 26
Apr.
Apr. 30

May 21

May 27
May 28
June

4

Aug. 21
Sept. 11
Oct. 16

Dec. 29
Dec. 29

New Mexico

First National Bank of Rio Arriba Espanola, N. Mex. (Conversion)
Mar. 23
Valley National Bank, Espanola, N. Mex. May 11 u
Las Cruces, N Mex
J fy
Fidelity National Bank, Albuquerque,
N. Mex
Nov. 20
June

3

6

Jan. 18
June 24

,,




Pennsylvania

South Carolina

Custer, S. Dak

Sept. 10

Apr.
June
Oct.
Dec.

21
24
16
22

South Dakota

Oct. 14
,
Dec. 29

Apr. 13
Tennessee

First National County Bank, Spring City,
Spring City, Tenn
June

3

Texas

Ohio

Tulsa, Okla
McAlester, Okla
Ada, Okla
Ponca City, Okla
Jenks, Okia
Ardmore, Okla
Edmond, Okla.
Ardmore, Okla

Apr. 13
Apr. 13
June 24
July 31
July 31
July 31
Aug. 20
Aug. 20
Aug. 21
Aug. 31
Aug. 31
Sept. 3
Dec. 30

Newtown, Pa
Sept. 9
Provident National Bank, Philadelphia,
Pa. (Conversion)
Oct. 7
Bala-Cynwyd, Pa
Dec. 22

July 17
Aug. 18

First National Bank of Garrington, Carrington, N. Dak
Mar. 19
The National Bank of Harvey, Harvey,
July 10
N. Dak

Oklahoma

Jan. 27
Feb. 15

Great Western National Bank, Portland,
Oreg
July 20

Fountain Inn, S. C.
Dillon, S. C
Barnwell, S. C
Lexington, S. C. . . .

North Dakota

Tower National Bank of Lima, Lima,
Ohio
Progress National Bank of Toledo, Toledo,
Ohio
National Bank of Defiance, Defiance,
Ohio
Minerva, Ohio.
First National Bank, Bowling Green, Ohio
(Conversion)
The Capital National Bank, Cleveland,
Ohio (Conversion)
Minerva National Bank, Minerva, Ohio.
The Central Security National Bank of
Lorain County, Lorain, Ohio (Conversion)

Edmonds, Okla
Shawnee, Okla
First National Bank, Henryetta, Henryetta, Okla
Feb. 15
First National Bank, Sallisaw, Sallisaw,
Okla
Mar. 19
Nicoma Park, Okla
Sand Springs, Okla
Burns Flat, Okla
Edmond, Okla
Edmond, Okla
Edmond, Okla
Tulsa, Okla
Tulsa, Okla
McAlester, Okla
Oklahoma City, Okla
Muskogee, Okla
,
Oklahoma City, Okla
Poteau, Okla

Sept 30

July 17

Approved Rejected
1964
1964

Oregon-

New York

Clarence, N.Y
Pioneer National Bank, New York, N.Y..
Rotterdam, N.Y
First National Bank of East Hampton,
East Hampton, N.Y
East Hampton, N.Y
Garden City, N.Y
First National Bank of Rochester Rochester, N.Y
,
Bohemia, N.Y
Republic National Bank of New York,
New York, N.Y
Brooklyn, N.Y

Oklahoma—Continued

Jan. 8
May 1
June 1
July 10
Aug. 31
Oct. 19
Dec. 4
Dec. 15
Jan.
Jan.
Jan.
Jan.
Jan.
Jan.
Jan.
Jan.

8
14
16
20
22
27
27
27

Garland, Tex
Dallas, Tex
Lubbock, Tex
Liberty National Bank of Dallas, Dallas,
Tex
Lone Star National Bank, Lone Star, Tex.
Abilene, Tex
Cypress, Tex
Neches National Bank of Silsbee, Silsbee,
Tex
Canyon, Tex
Richardson Heights National Bank, Richardson, Tex
South Houston, Tex
Houston, Tex
Houston, Tex
Houston, Tex
Woodville, Tex
Great Plains National Bank, Amarillo,
Tex
Northeast National Bank, San Antonio,
Tex
Texas National Bank of Dallas, Dallas,
Tex
Bayshore National Bank of La Porte, La
Porte, Tex
National Bank of Commerce of Brownsville, Brownsville, Tex
Texas City, Tex

Jan. 16
Tan. 18

Jan. 27
Feb. 1
Feb. 7

Feb. 22
Feb. 28

Feb. " H
Feb. 15
Feb! 22
Mar.
Apr.
Apr.
Apr.
May

28
30

30
1

May 11
May 11
May 11
May 12
May 18
May 18
181

TABLE B-4.—Applications for new national bank charters, approved and rejected, with name of bank and date of approval or
rejection, calendar 1964, by States—Continued
Texas— Continued

Approved Rejected
1964
1964

Westmoreland National Bank of Dallas,
Dallas, Tex
May 29
Spearman, Tex
June 24
Olney, Tex
July 2
Houston, Tex
July 7
Juy
Jacinto City, Tex
July 8
July 17
McAUen, Tex
y
Jul 27
Floydada, Tex
ly 27
Colonial National Bank of Garland, Garland, Tex
July 31
Dallas, Tex
Aug. 20
Irving, Tex
Aug. 31
Boerne, Tex
Oct. 16
Dallas, Tex
Dec. 4
Lubbock,Tex
Dec. 7
Lubbock, Tex
Dec. 7
Eagle Lake, Tex
Dec. 14
Houston, Tex
Dec. 14
LaMarque, Tex
Dec. 14
Pasadena, Tex
Dec. 29

Washington—Continued

Othello First National Bank, Othello,
Wash
Kennewick National Bank, Kennewick,
Wash
Renton, Wash
Bank of Vancouver, National Association,
Vancouver, Wash
Ocean Shores, Wash
Tacoma, Wash
Highlands National Bank of Renton,
Renton, Wash
Central Bank of Tacoma, National Association, Tacoma, Wash (Conversion)...

Mar. 19
Nov. 6

Apr. 22
May 26
July 31

July 22
Oct. 30
Nov. 5

Dec. 4
Dec. 16

West Virginia

First National Bank of West Hamlin,
West Hamlin, W.Va
Apr. 8
The First National Bank of Belle, Belle,
W.Va
May 11
Charleston, W.Va
Dec. 11

Utah

Wasatch National Bank, Murray, Utah..
Sandy, Utah
Citizens National Bank, Ogden, Utah...
Holladay, Utah

Approved Rejected
1964
1964

Wisconsin

June 24
Dec. 10

Virginia

Bailey's Crossroads, Va
Apr. 15
First National Bank of Norfolk, Norfolk,
Va
Apr. 29
Winchester, Va
July 10
Second National Bank of Richmond,
Richmond, Va
Oct. 30
Arlington, Va
Dec. 11
Metropolitan National Bank, Richmond,
Va
Dec. 18
Washington

Tacoma, Wash
Apr. 8
National Bank of Mason County, Shelton,
Wash
Apr. 13

Racine County National Bank, Franksville, Wis. (Conversion)
First American National Bank of Wausau,
Wausau, Wis. (Conversion)
Central National Bank of Stettin, Stettin,
Wis
Midland National Bank, Milwaukee, Wis.

July 10
Sept. 25
Sept. 25
Sept. 30

Wyoming

Western National Bank of Casper, Casper,
Wyo
y
J
Hillt National Bank, Casper, Wyo
Hilltop
First National Bank at Douglas, Douglas,
Wyo
Western National Bank of Lovell, Lovell,
Wyo
University National Bank of Laramie,
Laramie, Wyo
Sheridan, Wyo

8

Feb. 8
May 1
June 3
June 30

July 17

TABLE B-5.—National banks chartered during calendar 1964: by charter number, title and location. States, and
total capital account
Charter
No.

15339
15303
15342
15427
15267
15316
15441
15402

Title and location of bank, by States

Auburn National Bank of Auburn, Auburn i
American National Bank of Birmingham, Birmingham.
First National Bank of Butler, Butler
Shoals National Bank of Florence, Florence
Peoples National Bank of Huntsville, Huntsville
The American National Bank of Huntsville, Huntsville.
Capital National Bank of Montgomery, Montgomery. .
Baldwin National Bank of Robertsdale, Robertsdale l. .
Total: 8 banks..

15364

Continental National Bank, Phoenix. .

15387
15313
15257

First National Bank of Brinkley, Brinkley
First National Bank in Osceola, Osceola »
Commercial National Bank of Texarkana, Texarkana.

Total: 3 banks.
See footnote at end of table.

182




Total
capital account

$800, 736. 76
600, 000. 00
500, 000. 00
750, 000.00
800, 000. 00
500, 000. 00
1, 000, 000. 00
397,915.76
5, 348, 652. 52
3, 270, 792. 60
400, 000. 00
798, 722. 63
625, 000.00
1, 823,722. 63

TABLE B-5.—National banks chartered during calendar 1964: by charter number, title and location, States, and
total capital account—Continued

CALIFORNIA

Alameda First National Bank, Alameda
Orange Empire National Bank, Anaheim
Bakersfield National Bank, Bakersfield
National Bank of Berkeley, Berkeley
Inyo-Mono National Bank, Bishop
Peninsula National Bank of Burlingame, Burlingame
Concord National Bank, Concord.
Valley National Bank of Delano, Delano
Gateway National Bank, El Segundo
Surety National Bank, Encino
Escondido National Bank, Escondido
Humboldt National Bank, Eureka
Hayward National Bank, Hayward
Livermore National Bank, Livermore
Pioneer National Bank, Los Angeles
Silvex-lake National Bank, Los Angeles
Hollywood National Bank, Los Angeles
Marina Del Rey National Bank, Marina Del Rey
Newport National Bank, Newport Beach
County National Bank, Orange
Commercial National Bank, Orange County (P.O. Buena Park)
Palm Springs National Bank, Palm Springs
Sequoia National Bank of San Mateo County, Redwood City
Valley National Bank of Salinas, Salinas
Republic National Bank of San Diego, San Diego
Commonwealth National Bank of San Francisco, San Francisco
Commercial National Bank of San Leandro, San Leandro
San Luis Obispo National Bank, San Luis Obispo
Northern California National Bank of San Mateo, San Mateo
Los Padres National Bank, Santa Maria
Lincoln National Bank, Santa Rosa
Pacific Industrial National Bank of South El Monte, South El Monte.
San Joaquin Valley National Bank, Tulare
Saddleback National Bank, Tustin
,
Westminster National Bank, Westminster
Heritage National Bank, Westwood
National Bank of Whittier, Whittier.
Oakwood National Bank, Woodland Hills
Total: 38 banks.

$1,500,000.00
2, 000, 000. 00
1,500,000.00
1,500,000.00
750, 000. 00
2, 500, 000. 00
1,500,000.00
1,000,000.00
2, 000, 000. 00
2, 000, 000. 00
1,000,000.00
1,000,000.00
1,000,000.00
1,250,000.00
2, 000, 000. 00
1,500,000.00
1,500,000.00
1, 000, 000. 00
1,500,000.00
2, 250, 000. 00
1,500,000.00
1,250,000.00
1,500,000.00
1,250,000.00
3, 000, 000. 00
6, 000, 000. 00
2, 000, 000. 00
1, 000, 000. 00
2, 500, 000. 00
1,000,000.00
1,750,000.00
1,000,000.00
1,000,000.00
750, 000. 00
1,500,000.00
2, 400, 000. 00
1,500,000.00
1,000,000.00
62,150, 000. 00

COLORADO

Boulder National Bank, Boulder
The East Colorado Springs National Bank, Colorado Springs
The Western National Bank of Colorado Springs, Colorado Springs
National Bank of Delta, Delta
South Colorado National Bank, Denver
The First National Bank of Bear Valley, Denver.
Metropolitan National Bank, Denver
Mesa National Bank of Grand Junction, Grand Junction
South Platte National Bank, La Salle
First National Bank of Southglenn, Arapahoe County (P.O. Littleton)
Westlake First National Bank, Loveland
Total: 11 banks

510,650.00
505, 000. 00
525, 000. 00
309, 000. 00
360, 000. 00
522, 500. 00
900, 000. 00
540, 000. 00
367, 500. 00
312,500.00
240, 000. 00
5,092,150.00

CONNECTICUT

The North Haven National Bank, North Haven.. . .
Norwalk National Bank, Norwalk
Orange National Bank, Orange
Westport National Bank, Westport
Total: 4 banks

540, 000. 00
500, 000. 00
696, 000. 00
450, 000. 00
2,186,000.00

DISTRICT OF COLUMBIA

United Community National Bank.

1,200,000.00

See footnote at end of table.




183

TABLE B-5.—-National banks chartered during calendar 7964: by charter number, title and location, States, and
total capital account—Continued
Charter
No.

Title and location of bank, by States

15413 Peoples National Bank of Bay Harbor Islands, Bay Harbor Islands
15421 First Bank & Trust Co. of Boca Raton, National Association, Boca Raton x
15438 Boynton Beach First National Bank, Boynton Beach
15288 First National Bank of Gape Canaveral, Cape Canaveral
15425 Second City National Bank at Clearwater, Clearwater
15426 Third City National Bank at Clearwater, Clearwater
15270 The American National Bank in Cypress Gardens, Cypress Gardens
15337 Westchester National Bank of Dade County, Dade County—Coral Way at Galloway Road
15348 First National Bank of DeBary, DeBary
15448 Manufacturers National Bank of Hialeah, Hialeah
15237 The First National Bank of Maitland, Maitland
15318 Westside National Bank of Manatee County, Manatee County (P.O. Bradenton)
15311 National Bank of Melbourne & Trust Co., Melbourne l
15262 Five Point National Bank of Miami, Miami
15268 Fidelity National Bank of South Miami, South Miami
15278 Jefferson National Bank of Miami Beach, Miami Beach
15296 Capital National Bank of Miami, Miami1
15307 Lincoln National Bank of Miami, Miami
15411 United National Bank, Miami
15432 Okaloosa National Bank at Niceville, Niceville
15282 Halifax National Bank of Port Orange, Port Orange
15277 Northeast National Bank of St. Petersburg, St. Petersburg
15281 Liberty National Bank of St. Petersburg, St. Petersburg
15396 Second National Bank of Tampa, Tampa
15263 First National Bank of the Upper Keys, Tavernier
15287 Brevard National Bank, Titusville
Total: 26 banks.
First National Bank of Perry, Perry.

15368
15260
15459
15391
15371
15458
15389
15272
15346

American National Bank of Champaign, Champaign
Columbia National Bank of Chicago, Chicago
Seaway National Bank of Chicago, Chicago
The Pershing National Bank of Decatur, Decatur
First National Bank of Jacksonville, Jacksonville
Midwest National Bank of Moline, Moline
Community National Bank in Monmouth, Monmouth.
First National Bank of Mount Prospect, Mount Prospect1. . . .
The First National Bank of Western Springs, Western Springs *

300, 000. 00

Bank of Indiana, National Association, Gary 1

2, 090, 079. 29

Community National Bank of Clear Lake, Clear Lake.
Hays National Bank, Hays
National B k of Wichita, Wichita
N i l Bank f Wihi

350, 000. 00
750, 000. 00
, 000, 000. 00
400, 000. 00
350, 000. 00
350, 000. 00
450, 000. 00
528,132.23
723, 458. 76
4, 901, 590. 99

Total: 9 banks.

15306
15291

$420, 000. 00
1,189, 645. 77
500, 000. 00
620, 000. 00
500, 000. 00
400, 000. 00
300, 000. 00
600, 000. 00
450, 000. 00
600, 000. 00
600, 000. 00
400, 000. 00
1,801, 419. 41
000. 00
1, 000,
500, 000. 00
1,000, 000. 00
2, 964,401.01
600, 000. 00
000. 00
3, 000,
400, 000. 00
525, 000. 00
500, 000. 00
500, 000. 00
500, 000. 00
425, 000. 00
600, 000. 00
20,895,466.19

15373

15251

Total
capital account

350, 000. 00

KANSAS
500, 000. 00
500, 000. 00

Total: 2 banks

1,000,000.00
LOUISIANA

First National Bank of St. Bernard Parish, Arabi.
,
First National Bank of Denham Springs, Denham Springs
Riverlands National Bank in Laplace, Laplace
Total: 3 banks
See footnote at end of table.

15338
15344
15279

184




450, 000. 00
500, 000. 00
300, 000. 00
1,250,000.00

TABLE B-5.—National banks chartered during calendar 1964: by charter number, title and location. States, and
total capital account
Title and location of bank, by States

Charter
No.

Total
capital account

MARYLAND

15314
15285
15365
15249

Aberdeen National Bank, Aberdeen
Belair National Bank, Bowie
University National Bank, College Park
Chesapeake National Bank, Towson, Maryland, Towson.
Total: 4 banki

15399

Commonwealth National Bank, Boston.

$500,000. 00
800, 000. 00
1,000,000.00
1,250,000.00
3, 550, 000. 00

MASSACHUSETTS

3, 400, 000. 00
MICHIGAN

15446
15392
15367
15444
15274
15403
15420
15286

First National Bank of Fenton, Fenton
Grand Valley National Bank, Grandville
City Bank & Trust Co., National Association, Jackson l .
Livonia National Bank, Livonia 1
National Bank of Rochester, Rochester
Valley National Bank of Saginaw, Saginaw * l
Central National Bank of St. Johns, St. Johns
First National Bank of Wyoming, Wyoming 1
Total: 8 banks.

15304
15295
15309
15401

Valley National Bank of LeSueur, LeSueur l
National City Bank of Minneapolis, Minneapolis.
First National Bank of Navarre, Navarre
Citizens National Bank of Willmar, Willmar
Total: 4 banks

15284
15386

First National Bank of Clarksdale, Clarksdale.
First National Bank of Iuka, Iuka
Total: 2 banks. . . .

15454
15242
15299
15261
15377
15452
15362
15302
15457

First National Bank of Annapolis, Annapolis.
Dexter National Bank, Dexter
Security National Bank of Joplin, Joplin
Metropolitan National Bank, Kansas City
First National Bank of Poplar Bluff, Poplar Bluff
Mercantile Trust Co. National Association, St. Louis *..
The First National Bank of Pulaski County, St. Robert.
The First National Bank of Sikeston, Sikeston *.
Security National Bank of Sikeston, Sikeston
Total: 9 banks.

15397

First National Bank of Eureka, Eureka.

15376
15379
15435
15248

City National Bank of Lincoln, Lincoln....
Security National Bank of Omaha, Omaha.
West Omaha National Bank, Omaha l
Plainview National Bank, Plainview
Total: 4 banks. . .

700, 000. 00
400, 000. 00
026,981.00
056, 702. 05
500, 000. 00
582,601.87
511,000.32
549,571.00
11,326,856.24

430, 473. 52
3, 000, 000. 00
200, 000. 00
250, 000. 00
3, 880, 473. 52

650, 000. 00
300, 000. 00
950, 000. 00

300,000. 00
350, 000. 00
600, 000. 00
500, 000. 00
612,500.00
74, 366, 787. 07
300, 000. 00
845,931.00
600,000. 00
78,475,218.07
150,000.00
750, 000. 00
1,000,000.00
500, 000. 00
385, 592. 28
2, 635, 592. 28

See footnote at end of table.

779-563—65—13




185

TABLE B-5.—National banks chartered during calendar 1964: by charter number, title and location, States, and
total capital account—Continued

NEW JERSEY

Eatontown National Bank, Eatontown
Raritan Valley National Bank, Edison Township
First Bank & Trust Co., National Association, Fords 1
Madison National Bank, Madison
New Jersey National Bank & Trust Co., Neptune »
First National Bank of Scotch Plains, Scotch Plains
Peoples National Bank of Sparta, Sparta
Total: 7 banks

000, 000. 00
000, 000. 00
817,901.01
700, 000. 00
653, 567. 04
850, 000. 00
500, 000. 00
12, 521, 468, 05

NEW MEXICO

First National Bank in Clayton, Clayton
First National Bank of Rio Arriba, Espanola*
Valley National Bank, Espanola
Farmington National Bank, Farmington
Total: 4 banks

400, 000. 00
830, 943. 47
500, 000. 00
500, 000. 00
2, 230, 943. 47

NEW YORK

First National Bank of East Hampton, East Hampton
Century National Bank & Trust Co., New York
Chelsea National Bank, New York
Freedom National Bank of New York, N.Y
Metropolitan National Bank of Syracuse, Syracuse
Total: 5 banks

600, 000. 00
3, 000, 000. 00
3, 000, 000. 00
1, 500, 000. 00
3, 000, 000. 00
11,100,000.00

NORTH DAKOTA

250, 000. 00
150,000.00
200, 000. 00

First National Bank of Carrington, Carrington
The National Bank of Harvey, Harvey
First National Bank of Southwest Fargo, Southwest Fargo

600, 000. 00

Total: 3 banks
OHIO

First National Bank, Bowling Green i
The Capital National Bank, Cleveland *
Tower National Bank of Lima, Lima
The Central Security National Bank of Lorain County, Lorain *
Total: 4 banks
OKLAHOMA

First National Bank, Henryetta
Cache Road National Bank of Lawton, Lawton
Oklahoma National Bank of Norman, Norman
Founders National Bank of Oklahoma City, Oklahoma City
Friendly National Bank in Southwest Oklahoma City, Oklahoma City
Southwestern National Bank of Oklahoma City, Oklahoma City
First National Bank, Sallisaw, Sallisaw
University National Bank of Stillwater, Stillwater.
Republic National Bank of Tulsa, Tulsa
Guaranty National Bank, Tulsa
First National Bank of Weatherford, Weatherford
Total: 11 banks

693, 844. 21
3, 174, 538. 44
1, 000, 000. 00
2, 406, 879. 61
7, 275, 262. 26
300, 000. 00
350, 000. 00
510, 000. 00
, 020, 000. 00k
400, 000. 00
600, 000. 00
300, 000. 00
400, 000. 00
1, 020, 000. 00
600, 000. 00
400, 000. 00
5, 900, 000.00

PENNSYLVANIA

Lincoln National Bank, Philadelphia
Provident National Bank, Philadelphia i
Total: 2 banks

1,500,000.00
70,182,068.01
71,682,068.01

TENNESSEE

First National County Bank, Spring City
See footnote at end of table.
186




300, 000. 00

TABLE B-5.—National banks chartered during calendar 7964: by charter number, title and location, States, and
total capital account—Continued
Charter
No.

Title and location of bank, by States

TEXAS

15253
15252
15372
15269
15431
15258
15280
15292
15322
15328
15404
15410
15238
15301
15244
15298
15283
15319
15384
15250
15236
15440
15289
15370

Abilene National Bank, Abilene
Tascosa National Bank of Amarillo, Amarillo
,
Great Plains National Bank, Amarillo
Citizens National Bank of Beaumont, Beaumont
,
Gulfway National Bank of Corpus Christi, Corpus Christi. . .
Commonwealth National Bank of Dallas, Dallas
Citizens National Bank of Dallas, Dallas
Inwood National Bank of Dallas, Dallas
National Bank of Oak Cliff in Dallas, Dallas
Liberty National Bank of Dallas, Dallas
Westmoreland National Bank of Dallas, Dallas. ,
Colonial National Bank of Garland, Garland
Westmont National Bank, Houston
Union National Bank in Houston, Houston
First National Bank of Ingleside, Ingleside
Lone Star National Bank, Lone Star
First National Bank of Richardson, Richardson
Lackland National Bank of San Antonio, San Antonio
Neches National Bank of Silsbee, Silsbee
Peoples National Bank of Sulphur Springs, Sulphur Springs.
Randolph Field National Bank, Universal City
Uvalde National Bank, Uvalde
White Settlement National Bank, White Settlement.
Southwest National Bank of Wichita Falls, Wichita Falls. ..

15390
15254
15353
15334
15247
15315
15461
15293

$505, 000. 00
600, 000. 00
600, 000.00
, 000, 000. 00
500, 000. 00
759, 375. 00
, 020,000. 00
615,000.00
520, 000. 00
520, 000. 00
520, 000. 00
622, 500. 00
500, 000. 00
, 000, 000. 00
250, 000. 00
250, 000. 00
561,000.00
600, 000. 00
400, 000. 00
500, 000. 00
400, 000. 00
410, 000. 00
525, 000. 00
500, 000. 00
13, 677, 875. 00

Total: 24 banks.
15352
15243

Total
capital account

Draper National Bank, Draper
American National Bank of Salt Lake City, Salt Lake City.
Total: 2 banks. .
Monticello National Bank, Albemarle County (P.O. Charlottesville).
Fidelity National Bank, Arlington
Woodlawn National Bank, Fairfax County (P.O. Alexandria)
American National Bank, Fredericksburg
Grundy National Bank, Grundy
Fairfield National Bank of Highland Springs, Highland Springs
First National Bank of Norfolk, Norfolk
Guardian National Bank of Fairfax County, Springfield

352, 000. 00
600, 000. 00
952, 000. 00

750, 000. 00
, 200, 000. 00
900, 000. 00
600, 000. 00
500, 000. 00
300, 000. 00
,
1, 500, 000. 00
750, 000. 00
6, 500, 000. 00

Total: 8 banks.
WASHINGTON

15351
15324
15445
15264
15418

American National Bank of Edmonds, Edmonds. . . ,
Timbermens National Bank of Hoquiam, Hoquiam.
Othello First National Bank, Othello
First Union National Bank, Puyallup
National Bank of Mason County, Shelton.

300,000. 00
300, 000. 00
410,000.00
400, 000. 00
410,000.00
1, 820, 000. 00

Total: 5 banks. .
WEST VIRGINIA

15385
15414
15406

The First National Bank of Belle, Belle
First National Bank of Weirton, Weirton
First National Bank of West Hamlin, West Hamlin
Total: 3 banks.

200, 000. 00
500, 000. 00
200, 000. 00

900, 000. 00

See footnote at end of table.




187

TABLE B-5.—-National banks chartered during calendar 1964: by charter number, title and location, States, and
total capital account—'Continued
Charter
No.

Total
capital account

Title and location of bank, by States

15381 Brookfield National Bank, Brookfield
15380 Racine County National Bank, Franksville 1
15325 First National Bank oi Glendale, Glendale. ,
15335 New London National Bank, New London.
15424 First American National Bank of Wausau *.

$600, 000. 00
658,139.30
600, 000. 00
375, 000. 00
2, 871, 053. 65

Total: 5 banks.

5,104,192. 95
WYOMING

15300
15359
15409
15405

Western National Bank of Gasper, Casper
Hilltop National Bank, Casper
University National Bank of Laramie, Laramie
Western National Bank of Lovell, Lovell

500, 000. 00
350, 000. 00
300, 000. 00
200, 000. 00

1, 350,000. 00

Total: 4 banks
BANKS FORMED BY F D I G U N D E R SECTION 11 OF T H E FEDERAL DEPOSIT INSURANCE A C T

Deposit Insurance National Bank of Dell City, Dell City, Tex.
Deposit Insurance National Bank of Newport News, Newport News, Va.
i Conversion of State chartered bank.
TABLE B-6.—-State chartered banks converted to national banks during calendar 1964, by title and location of bank, State,
effective date, outstanding capital stock, surplus, undivided profits and reserves, and total assets
Charter
No.

Title and location of bank

15248
15255

Plain view National Bank, Plainview
First Bank & Trust Co., National Association, Fords.
First National Bank of Mount Prospect....
First National Bank of Wyoming
Capital National Bank of Miami
New Jersey National Bank & Trust Co.,
Neptune.
The First National Bank of Sikeston
Valley National Bank of Le Sueur
National Bank of Melbourne & Trust Co.,
Melbourne.
First National Bank of Rio Arriba, Espanola.
First National Bank in Osceola
Auburn National Bank of Auburn
The First National Bank of Western
Springs.
City Bank & Trust Company, National
Association, Jackson.
Racine County National Bank, Franksville.
Baldwin National Bank of Robertsdale....
Valley National Bank of Saginaw
First National Bank, Bowling Green
Central National Bank of St. Johns
First Bank & Trust Co. of Boca Raton,
National Association.
Provident National Bank, Philadelphia....
The Capital National Bank, Cleveland
First American National Bank of Waussu. .
Livonia National Bank, Livonia
Mercantile Trust Co. National Association, St. Louis.
Bank of Indiana, National Association,
Gary.
The Central Security National Bank of
Lorain County, Lorain.

State

Effective
date of
charter
1964

$77,425,023.50

Total: 27 banks.

15272
15286
15296
15297
15302
15304
15311
15312
15313
15339
15346
15367
15380
15402
15403
15416
15420
15421
15422
15423
15424
15444
15452
15455
15456
1

Includes $25 million capital notes and debentures.

188




Outstanding
capital stock

Surplus, undivided profits, and

Total assets

$134,306,090 $2,164, 268, 066

Nebr.,

NJ...

Jan. 21
Jan. 31

100,000
1, 250, 000

284, 025
2,576,516

3, 079, 905
59, 802, 998

111....
Mich.
Fla...

NJ...

Feb. 29
Mar. 31
Apr. 3
Apr. 7

300, 000
300, 000
1,819,125
1, 580, 020

227, 545
202,919
756, 606
3, 074,120

5, 030, 572
8,080,915
30, 963, 000
66,222,816

Mo...
Minn.
Fla...

Apr. 10
Apr. 14
Apr. 24

200, 000
100,000
600, 000

710,227
297, 094
860, 569

8, 694, 700
4, 972, 254
21,730,011

N.M.

Apr. 30

300, 000

560, 387

10, 998, 248

Ark...
Ala.. .
Ill

May 1
June 20
June 30

200, 000
200, 000
300, 000

590, 906
605, 560
380, 071

9,488,812
10, 236, 979
12, 701, 674

Mich.

Aug. 5

2,100,000

4,915,275

Wis...

Aug. 31

200, 000

459, 972

9,105,246

Ala...
Mich.
Ohio..
Mich.
Fla...

Oct.
Oct.
Oct.
Nov.
Nov.

100, 000
250, 000
275, 000
150,000
510, 000

300, 060
318,495
413,973
388, 329
747, 021

3, 359, 615
10,052,312
8,690,195
4, 740, 605
19, 360, 843

Pa....
Ohio.
Wis.,
Mich.
Mo...

Nov.
Nov.
Nov.
Dec.
Dec.

56,218,580
2,214,586
2, 628, 821
564, 424

669, 934, 765
54, 806, 231
54, 606, 222
18,872,285

51, 494, 610

881, 297, 805

Ind.
Ohio

10
14
31
12
9

12 14,754,216
16 1, 000, 000
10
700, 000
15
500, 000
24
47,736,662.501
Dec. 24
900, 000
Dec. 28
1, 000, 000

96,140,173

1,140,068

42, 659, 602

1, 375,331

38, 639, 283

TABLE B—7.—Naiioncl banks reported in voluntary liquidation during calendar 1964 with the names of succeeding banks,
the dates of liquidation, and total, capital accounts
Title and location of bank

Date of
liquidation

Total capital
accounts

17, 999, 332

Total: 11 banks.
Southern Hills National Bank, Tulsa, Okla. (15138), absorbed by Mercantile National Bank,
Tulsa, Okla
Nov. 29,1963
Jan. 14,1964
The Second National Bank of Monmouth, III. (2205)
The Bensonhurst National Bank of Brooklyn in New York, N.Y. (13080), absorbed by Chemical
Bank New York Trust Co., New York
Feb. 25,1964
The First National Bank of Sharpsville, Pa. (6829), absorbed by McDowell National Bank of
Sharon, Pa
Apr. 18,1964
The Winchester National Bank, Winchester, N.H. (887), absorbed by the Cheshire National Bank
of Keene, N.H
Apr. 24,1964
Tri-Cities National Bank, Pasco, Wash. (14919), absorbed by Old National Bank of Washington,
Spokane, Wash
June 30, 1964
The First National Bank of Hagerman, N. Mex. (7503), absorbed by the First National Bank of
Roswell, N. Mex
July 10,1964
The First National Bank of Barnesboro, Pa. (5818), absorbed by the First National Bank of EbensDec. 12,1964
burg, Pa
The Farmers' National Bank of Liberty, Pa. (11127), absorbed by the First National Bank of WellsDec. 14,1964
boro,i Wellsboro, Pa
The Pattison National Bank ofElkland, Pa. (5043), absorbed by the First National Bank of WellsDec. 16,1964
born, Wellsboro, Pa
The First National Bank of Knoxville, Pa. (9978), absorbed by the First National Bank of WellsDec. 16,1964
boro, Wellsboro, Pa

74, 561
520,970
3, 308, 364
1,250, 000
310, 309
552,380
360, 632
800, 000
269, 933
364, 072
188,111

'Simultaneously with the absorption, the First National Bank of Wellsboro changed its name to Northern National Bank &
Trust Co.
TABLE B-8.—National banks merged or consolidated with and into State banks during calendar 1964, with effective
dates, and total capital accounts
Title and location of bank

Total: 15 banks.

Effective
date,
7964

Total
capital
accounts

$16,691,240

The First National Bank of Brewsters, N.Y. (2225), merged with and into the County Trust Co., White
Plains, N.Y
457, 762
Jan. 10
The Hallwood National Bank, Hallwood, Va. (7659), merged with and into the Bank of Virginia, Rich451,310
mond, Va
Jan. 31
The First National Bank of Mount Vernon, N.Y.1 (5271), merged with and into Chemical Bank New
3,742,613
York Trust Co., New York, N.Y
Feb. 24
The First National Bank & Trust Co. of Roebling, N J . (11620), merged with and into Bordentown
644, 431
Banking Co., Bordentown, N J
Mar. 26
The First National Bank of Riegelsville, Pa. (9202), merged with and into Girard Trust Com Exchange
718,981
Bank, Philadelphia, Pa., and under the title "Girard Trust Bank''
Mar. 21
The Youngsville National Bank, Youngsville, Pa. (14345), merged with and into Pennsylvania Bank &
514,769
Trust Co., Titusville, Pa
Apr. 15 |
National Bank of Maryland, Silver Spring, Md. (14846), merged with and into Citizens Bank of Mary826, 594
land, Riverdale, Md
May 1 |
The First National Bank of Park Ridge, N J . (12195), merged with and into County Trust Co., Tenafly,
860, 922
NJ
May 29
The First National Bank of Westboro, Mass. (421), consolidated with Guaranty Bank & Trust Co.,
758, 257
Worcester, Mass
June 30 |
The Elk County National Bank of Ridgway, Pa. (5014), merged with and into the St. Marys Trust Co.,
St. Marys, Pa., and under the title "Elk County Bank & Trust Co."
'
834, 682
July 17 |
The First National Bank of Milltown, N J . (10935), merged with and into the Edison Bank, Edison, N J . Aug. 14 j 1,006,189
Second National Bank of Philadelphia,2 Pa. (21 3), merged with and into Provident Tradesmens Bank &
Trust Co., Philadelphia, Pa
Aug. 16 | 3,662,611
Belfast National Bank, Belfast, N.Y. (9644), merged with and into the First Trust Co. of Allegany Countv,
Wellsville, N.Y.
Oct. 14 |
269, 620
The Citizens National Bank of Hampton, Va. (13775), merged with and into Citizens Marine Jefferson
Bank, Newport News, Va., and under title "Citizens and Marine Bank"
Oct. 30 i 1,469,913
The First National Bank of Cairo, N.Y. (12586), merged with and into State Bank of Albany, N.Y
472, 586
Nov. 10 j
1

With 1 local and 2 outside branches.
2 With 4 local branches.




189

TABLE B-9.—National banks converted into State banks, calendar 1964, with effective date, and total capital accounts
Title and location of bank

Effective Total capital
date, 1964 accounts

Total: 6 banks

$2, 945, 652

Midway National Bank of Cedar Falls, Iowa (14946), converted into Midway Bank & Trust
The First National Bank of Monticello, Ga. (9346), converted into Bank of Monticello
The Harrisburg National Bank of Houston, Tex. (12840), converted into Harrisburg Bank
Deer Park National Bank, Deer Park, Tex. (14819), converted into Deer Park Bank
Clear Creek National Bank, Seabrook, Tex. (14983), converted into Clear Creek Bank
First National Bank of Kerens, Tex. (13656), converted into the First State Bank of Kerens

Feb.
Feb.
June
Oct.
Oct.
Nov.

1
8
12
15
15
30

186, 937
195, 372
15 440, 702
520, 480
334, 886
267, 275

TABLE B—10.—Purchases of State banks by national banks, calendar 1964, with title and location, effective dates of purchase,
and total capital accounts of State banks
Title and location of bank

Total capital

$3, 035, 904

Total: 8 banks.
The First National Bank of Wilkes-Barre, Pa. (30), purchased the White Haven Savings Bank, White
Haven, Pa
The Michigan National Bank, Lansing, Mich. (14032), purchased the Grand Ledge State Bank
and the Loan & Deposit State Bank, Grand Ledge, Mich
The First National Bank & Trust Co. of Kalamazoo, Mich. (191), purchased the Delton State Bank,
Delton, Mich
Lafayette National Bank, Lafayette, Ind. (14175), purchased the Bank of Dayton, Ind
Michigan National Bank, Lansing, Mich. (14032), purchased the Citizens Industrial Bank, Grand
Rapids, Mich
The National Bank of Commerce of Seattle, Wash. (4375), purchased the Bank of Endicott, Wash
First Security Bank of Idaho, National Association, Boise, Idaho (14444), purchased the Farmers Bank,
Kendrick, Idaho

190




Mar. 14

354, 844
592, 000
405, 000

Apr. 18
May 9

226, 088
152,273

June 15
June 19

503, 921
226, 778

Aug. 21

575, 000

Jan. 3

TABLE B-l 1.—Consolidations of national banks, or national and State banks, calendar 1964, with title and location,
outstanding capital stock, surplus, undivided profits and reserves, and total assets
Title and location of bank

Total: 8 consolidations (after consummation)
Texas National Bank of Houston, Houston, Tex. (10152),
with
and the National Bank of Commerce of Houston, Houston, Tex. (10225), which had
consolidated Jan. 17, 1964, under charter of the latter
bank (10225) and under title "Texas National Bank
of Commerce of Houston." The consolidated bank
at the date of consolidation had
Beaver County Trust Co., New Brighton, Pa., with
and the Western Pennsylvania National Bank, McKeesport, Pa. (2222), which had
consolidated Feb. 7, 1964, under charter and title of the
latter bank (2222). The consolidated bank at the date
of consolidation had
Security Trust Co., Lynn, Mass.,1 with
and the Danvers National Bank, Danvers, Mass. (7452),
which had
,
consolidated Feb. 21, 1964, under charter of the latter
bank (7452), and under title of "Security-Danvers
National Bank." The consolidated bank at the date
of consolidation had
,
Commonwealth Bank & Trust Co., Pittsburgh,2 Pa., with..
and the Union National Bank of Pittsburgh, Pittsburgh,
Pa. (705), which had
,
consolidated Feb. 28, 1964, under charter and title of the
latter bank(705). The consolidated bank at the date
of consolidation had
The First National Bank of Narrowsburg, Narrowsburg,
N.Y. (12496), with
and the First National Bank in Callicoon, Callicoon,
N.Y. (13590), which had
consolidated June 30, 1964, under charter of the latter
bank (13590), and under title of "United National
Bank." The consolidated bank at the date of consolidation had
,
Citizens National Bank of Beaver Falls, Beaver 3 Falls, Pa.
(14764), with
and Western Pennsylvania National Bank, McKeesport,
Pa. (2222), which had
consolidated Oct. 3, 1964, under charter and title of the
latter bank (2222). The consolidated bank at the date
of consolidation had
Calhoun Siate Bank, Homer, Mich., with
and City Bank & Trust Co., National Association, Jackson, Mich. (15367), which had
!
consolidated Nov. 5, 1964, under charter and title of the
latter bank (15367). The consolidated bank at the
date of consolidation had
The First National Bank of Wise, Wise, Va. (10611), with. .
and the First National Bank of Norton, Norton, Va.
(6235), which had
,
consolidated July 31, 1964, under the charter of the
latter bank (6235) and under title "The Wise County
National Bank." The consolidated bank at the date
of consolidation had

Outstanding
capital stock

$54, 870, 350

Surplus

$94, 020, 680

Undivided profits
and reserves

$25, 089, 055

Total assets

$2, 463, 804,291

16,000,000

6, 302, 464

322, 646, 899

15,000,000

19,267,280

3, 921, 031

503, 743, 098

24, 000, 000
300, 000

35, 267, 280
500, 000

7, 753, 690

15,246,310

3, 266, 660

542,121, 391

,153,690
550, 000

15,746,310
1,221,000

3, 543, 835
856, 559

548, 912, 688
29, 783, 695

350, 000

450, 000

276,139

900, 000
3,187, 500

1, 600, 000
8, 812, 500

1,203,698
2, 039, 410

39, 260, 794
164,640,486

4, 316, 500

13,183, 500

2, 561, 550

222, 879, 859

10,000,000

20, 000, 000

4,100, 966

387, 520, 345

50, 000

200, 000

119,180

4, 322, 809

100, 000

350, 000

80, 409

6,122,103

10, 444, 912

9, 000, 000

10,223,496
377,168

826, 389, 997
8,205,160

9, 477, 099

350, 000

350, 000

199, 590

200, 000

200, 000

81,462

6,107, 963

8,642,910

16,407,090

4,103,069

530, 002, 302

8,892,910
100, 000

16,607,090
250, 000

4,134,532
68,214

536,110,264
3, 944,140

2,100,000

3, 900, 000

1,128, 325

100, 000, 237

2, 245, 000
100, 000

3, 900, 000
100, 000

1,401,539
172,893

103, 944, 377
3,618,827

160, 000

450, 000

177, 256

7, 606, 828

328, 750

550, 000

281,399

11,220,914

1 With 2 local branches.
4 local and 7 outside branches
With L

2
With
3




191

TABLE B-12.—Mergers of national banks, or national and State banks, calendar 7964, with title and location, outstanding
capital stock, surplus, undivided profits and reservs, and total assets
Title and location of bank

Total: 69 mergers (after consummation)
The Citizens Bank, Westerville, Ohio,1 with
and the City National Bank & Trust Co. of Columbus,
Columbus, Ohio (7621), which had
merged Jan. 2, 1964, under the charter and title of the
latter bank (7621). The merged bank at the date of
merger had
Traders Bank & Trust Co., Hazleton, Pa., with
and Northeastern Pennsylvania National Bank & Trust
Co., Scranton, Pa. (77), which had
merged Jan. 3, 1964, under charter of the latter bank
(77) and under title of "Northeastern Pennsylvania
National Bank & Trust Co." The merged bank at the
date of merger had
The Bank of Worcester, Worcester, N.Y., with
and National Commercial Bank & Trust Co., Albany,
N.Y. (1301), which had
merged Jan. 31,1964, under the charter and title of the
latter bank (1301). The merged bank at the date of
merger had
The First National Bank of Lacona, Lacona, N.Y. (10175),
with
and the Merchants National Bank & Trust Co. of Syracuse, Syracuse, N.Y., (1342), which had
merged Jan. 31, 1964, under the charter and title of the
latter bank (1342). The merged bank at the date of
merger had
The Farmers & Merchants National Bank of Williamsburg
Williamsburg, Pa. (9392), with
and the First National Bank of Claysburg, Claysburg,
Pa. (10232), which had
merged Jan. 31, 1964, under charter of the latter bank
(10232), and under title of "The Central Pennsylvania
National Bank of Claysburg." The merged bank at
the date of merger had
Farmers Bank of Holland, Inc., Holland, Va., with
and Seaboard Citizens National Bank, Norfolk, Va.
(10194) which had
merged Feb. 12, 1964, under the charter and title of the
latter bank (10194). The merged bank at the date of
merger had
The First National Bank of New Bloomfield, New Bloomfield, Pa. (5133), with
and the Harrisburg National Bank & Trust Co.,
Harrisburg, Pa. (580), which had
merged Feb. 14, 1964, under the charter and title of the
latter bank (580). The merged bank at the date of
merger had
First National Bank of Minoa, Minoa, N.Y. (13476), with. .
and Lincoln National Bank & Trust Co. of Central New
York, Syracuse, N.Y. (13393), which had
merged Feb. 28, 1964, under charter and title of the
latter bank (13393). The merged bank at the date of
merger had
The First National Bank of Pullman, Pullman,2 Wash.
(4699), with
and Old National Bank of Washington, Spokane, Spokane, Wash. (4668), which had
merged Feb. 28, 1964, under the charter and title of
the latter bank (4668). The merged bank at the date
of merger had
The Peoples Bank of Erie County, Hamburg,3 N.Y., with
and Liberty National Bank & Trust Co., Buffalo, N.Y.
(15080), which had
merged Mar. 5, 1964, imder the charter and title of the
latter bank (15080). The merged bank at the date
of merger had
|
See footnotes at end of table.

192




Outstanding
capital stock

Surplus

Undivided profits
and reserves

$269,917,449

$500, 733, 472

$157, 678,147

250, 000

300, 000

363, 955

9,134,215

6, 300,000

6,700,000

3,100,000

217,261,957

6, 650, 000
350, 000

7, 350,000
450,000

3, 001, 272
279,156

224, 995, 630
14, 827, 693

5, 562,000

5, 638, 000

3, 664, 837

178,100,427

6,066, 000
60, 000

6,000, 000
120,000

3, 877, 994
160, 821

192,928,121
2, 928,713

7,283, 205

17, 928, 925

4, 091, 725

460,275,112

7, 346,205

17, 928, 925

4, 369, 546

463, 049, 981

50, 000

150, 000

98, 425

3, 095, 592

2, 553,100

5,000, 000

2, 446, 961

129, 903, 495

2, 643,100

5,110,000

2, 538, 924

133, 304,140

50, 000

125,000

42, 956

2,003,046

200, 000

400,000

178,972

9,229, 370

250,000
35,000

525, 000
185,000

221,929
119,488

11,232,417
2, 876,156

2, 375, 000

7, 625,000

352, 918

103,615,510

2, 434, 500

7, 785, 500

473, 407

106,102, 722

50,000

250, 000

185,261

4, 847,238

2, 830,000

7,170,000

1, 510, 771

117,908,599

2, 905,000
150,000

7, 420, 000
300, 000

2, 654, 528
123, 567

122, 755, 833
6,273,433

2, 843, 590

6, 000, 000

2, 566, 817

156,033,619

3, 053, 590

6, 240,000

2, 690, 385

162,211,424

250, 000

750,000

312,582

15,342,275

4,125, 000

5, 875, 000

4,857,013

176,873,976

4, 662, 500
497, 000

7, 337, 500
564, 200

4,169, 596
675, 687

191,719,372
22, 313, 663

4, 899, 040

10,426, 250

3, 367, 293

297,076, 017

5,425, 860

10, 960, 630

4,177, 517

319,308,335

Total assets

$12, 367, 076, 645

TABLE B-12.—Mergers of national banks, or national and State banks, calendar 1964, with title and location, outstanding
capital stock, surplus, undivided profits and reserves, and total assets—Continued
Title and location of bank

Outstanding
capital stock

The First National Bank of Bicknell, Bicknell, Ind. (7155),
with
Bicknell Trust &. Savings Co., Bicknell, Ind., with
The Citizens State Bank, Bicknell, Ind., with
,
and the American National Bank of Vincennes, Vincennes, Ind. (3864), which had
merged Mar. 21, 1964, under charter and title of the
the latter bank (3864). The merged bank at the
date of merger had
Darlington County Bank & Trust Co., Darlington S.C.,
with
and the First National Bank of South Carolina of
Columbia, Columbia, S.C. (13720), which had
merged Mar. 31, 1964, under charter and title of the
latter bank (13720). The merged bank at the date
of merger had
The New Market National Bank, Newmarket, N.H. (1330),
with
and the Rockingham National Bank of Exeter, Exeter,
N.H. (12889), which had
merged Apr. 3,1964, under charter and title of the Jatter
bank (12889). The merged bank at the date of merger
had
,
The First National Bank of Buena Vista, Buena Vista, Va.
(9890), with
and Virginia National Bank, Norfolk, Va. (9885), which
had
merged Apr. 3,1964* under charter and title of the latter
bank (9885). The merged bank at the date of merger
had

.•••••:

••••

Southern Bank of Commerce, Danville, Va.}4 with
,
and Virginia National Bank, Norfolk, Va. (9885), which
had
,
merged Apr. 3, 1964, under charter and title of the
latter bank (9885). The merged bank at the date
of merger had
,
The First National Bank of Lebanon, Lebanon, Va. (6886),
with
,..,
and the First National Exchange Bank of Virginia,
Roanoke, Va. (2737), which had
merged Apr. 24, 1964, under charter and title of the
latter bank (2737). The merged bank at the date
of merger had
The First National Bank of Richlands, Richlands, Va.
(10850), with
and the First National Exchange Bank of Virginia,
Roanoke, Va. (2737), which had
!"
merged Apr. 24, 1964, under charter and title of the
latter bank (2737). The merged bank at the date of
merger had
,
State Bank of Linwood, Linwood, Mich., with
and Peoples National Bank & Trust Co. of Bay City,
Bay City, Mich. (14641), which had
merged Apr. 25, 1964, under charter and title of the
latter bank (14641). The merged bank at the date
of merger had
The Union National Bank of Mahanoy City,5 Mahanoy
City, Pa. (3997), with
and the Pennsylvania National Bank & Trust Co. of
Pottsville, Pottsville, Pa. (1663), which had
merged May 8, 1964, under charter and title of the
latter bank (1663). The merged bank at the date
of merger had
The First National Bank of Blue Ridge Summit, Blue Ridge
Summit, Pa. (12281), with
and First National Bank & Trust Co. in Waynesboro,
Waynesboro, Pa. (11866), which had
merged May 9, 1964, under the charter and title of the
latter bank (11866). The merged bank at the date
of merger had
,
See footnotes at end of table.
7 79-563—65

14




Surplus

Undivided profits
and reserves

Total assets

$60, 000
35, 000
35, 000

$105,000
65,000
85, 000

$135,094
37, 843
41,913

$2, 398,048
1,697,597
1,072,072

750, 000

750,000

822, 778

21,799, 040

880, 000

880, 000

1,162,330

26, 591, 805

215,000

310,000

137,137

6, 372, 795

2,192,370

4, 807, 630

1,439,166

105,971,091

2,321,370

5,178, 630

1,550,205

111,768,296

75, 000

165,000

44, 697

3, 640, 775

200, 000

425, 000

171,763

9, 570, 223

275, 000

590, 000

216,460

13,210,998

120, 000

280, 000

52, 867

4, 995, 320

8,084, 825

20, 812, 775

4, 498, 463

394, 470,103

8,198, 825
100, 000

21,098,775
200, 000

4, 551, 330
23, 658

399,206, 974
2, 912, C64

8, 014, 825

20, 582, 775

4, 474, 805

391, 628, 739

8, 084, 825

20, 812, 775

4, 498, 463

394, 470,103

120, 000

440, 000

266, 532

8, 513, 321

5, 752, 490

10, 685, 010

1, 698, 937

205,164,466

5, 980, 490

11,125,010

1,771,133

213,427,071

250, 000

1,000,000

300,315

14, 372, 920

5, 314, 990

9,685,010

1, 740, 736

191,263,269

5, 752, 490
150,000

10,685,010
150,000

1,698,937
106, 039

205,164, 466
3, 542, 358

2, 977, 500

3, 600, 000

1,477,323

99,150,775

3, 086, 250

3, 600, 000

1, 774, 612

102,693,133

312, 500

500, 000

44, 843

13, 951, 362

800, 000

1, 000, 000

340, 685

37, 526, 608

1, 050, 000

1, 500, 000

448, 028

51, 477, 970

75, 000

225, 000

91,918

4, 432, 923

900, 000

1, 700, 000

598, 231

19,757,539

1, 050, 000

1, 925, 000

588, 900

24,190, 461

193

TABLE B-12.—Mergers of national banks, or national and State banks, calendar 7964, with title and location, outstanding
capital stock, suplus, undivded profits and reserves, and total assets—Continued
Title and location of bank

Cherry Hill National Bank, Cherry Hill, N J . 8 (14936), with.
and First Camden National Bank & Trust Co., Camden,
NJ. (1209), which had
merged May 15, 1964, under charter and title of the
latter bank (1209). The merged bank at the date of
merger had
Woodbridge National Bank, Woodbridge, NJ. • (14378),
with
and First Bank & Trust Co., National Association,
Fords, NJ.? (15255), which had
merged May 15, 1964, under the charter and title of
the latter bank (15255). The merged bank at the
date of merger had
The Bank of Rowland, Rowland, N.C., with
and Southern National Bank of North Carolina, Lumberton, N.C. (10610), which had
merged May 23, 1964, under charter and title of the
latter bank (10610). The merged bank at the date of
merger had
Citizens Bank of Darlington, Darlington, S.C.10 with
and the Citizens & Southern National Bank of South
Carolina, Charleston, S.C. (14425), which had
merged May 23, 1964, under charter and title of the
latter bank (14425). The merged bank at the date
of merger had
Carolina Bank, Graniteville, S.C.» with
and the Citizens & Southern National Bank of South
Carolina, Charleston, S.C. (14425), which had
merged May 23, 1964, under the charter and title of
the latter bank (14425). The merged bank at the
date of merger had
Salmon Falls Bank, Rollinsford, N.H. with
and the First National Bank of Somersworth, Somersworth, N.H. (1180), which had
merged May 29, 1964, under the charter of the latter
bank (1180) and under the title "First SomersworthRollinsford National Bank." The merged bank at the
date of merger had
The American National Bank of San Bernardino, n San
Bernardino, Calif. (10031), with
and the Bank of California, National Association, San
Francisco, Calif. (9655), which had
merged June 26, 1964, under charter and title of the
latter bank (9655). The merged bank at the date of
merger had
The Macungie Bank, Macungie, Pa., with
and the First National Bank of Allen town, Allen town,
Pa. (373), which had
merged June 30, 1964, under charter and title of the
latter bank (373). The merged bank at the date of
merger had
The Peoples National Bank of West Alexander, West Alexander, Pa. (8954), with
and the First National Bank of Fredericktown, Federicktown, Pa. (5920), which had
merged June 30, 1964, under the charter and title of the
latter bank (5920). The merged bank at the date of
merger had
National Bank of Commerce of Chicago, Chicago, 111.
(14349), with
and Central National Bank in Chicago, Chicago, 111.
(14362), which had
merged July 18, 1964, under the charter and title of the
latter bank (14362). The merged bank at the date
of merger had
Allegan State Bank, Aliegan, Mich., with
and the First National Bank & Trust Co. of Kalamazoo,
Kalamazoo, Mich. (191), which had
merged July 18, 1964, under the charter and title of the
latter bank (191). The merged bank at the date of
merger had
See footnotes at end of table.

194




Outstanding
capital stock

$300, 000

Undivided profits
and reserves

$300, 000

$228, 817

Total assets

$7, 424, 859

3,190,700

6, 059, 300

1, 492, 348

169,477,653

3,415,700

6, 584, 300

1,571,165

176,902,512

500, 000

1,000, 000

1,250,000

2,250, 000

1, 375, 000
75, 000

2, 250, 000
275, 000

80, 662
117,412

85, 733, 774
3, 858, 503

1, 000, 000

1, 622, 000

378, 634

32, 695, 056

1,142, 500
150,000

1, 829, 500
300, 000

496, 046
128,138

35, 908, 303
5,611,686

3,136,650

9, 385, 350

1,129,832

170,155,052

3, 246, 650
125, 000

9, 685, 350
0

1,225,282
78, 828

175, 735, 790
2, 432, 227

3,114, 650

9, 385, 350

1,123,115

167, 853, 862

3,136,650
50, 000

9, 385, 350
50, 000

1,129, 832
63,102

170,155,052
719,560

100, 000

100, 000

392, 603
1,631,413

115,241

24, 786,119
65, 568, 994

1,331,195

150,000

150,000

1, 050, 000

1, 050, 000

1,333,074

16,370,800

34, 209, 200

7,594,157

1,009,630,696

17, 890, 800
50,000

37,109,200
250,000

6, 080, 061
195,159

1, 074, 572, 714
4, 559, 586

3,094,230

7,100, 000

2, 918, 683

155,725,087

3, 226, 830

7, 350, 000

3,031,242

160,284,674

178, 343

2, 050, 756
64, 555, 815

1,842,728

50, 000

150,000

83, 841

250, 000

450,000

158,352

570, 000

242,193

15,567,112

464, 007

40, 947, 905

330, 000

13, 724, 384

1,000,000

1,500,000

5,000, 000

5, 000,000

1, 327, 361

207,018,960

6,250, 000
400,000

6,250, 000
400,000

1,791,369
467,153

247, 966, 865
15,420,907

1, 800, 000

3,200,000

2,218,124

114,521,893

2,160,000

3,200, 000

3,124,293

129,919,270

TABLE B-12.—Mergers of national banks, or national and State banks, calendar 1964, with title and location, outstanding
capital stock, surplus, undivided profits and reserves, and total assets—Continued
Title and location of bank

The Community Bank, Dayton, Ohio, with
and the National Bank of Dayton, Dayton, Ohio (1788),
which had
merged July 18, 1964, under the charter and title of the
latter bank (1788). The merged bank at the date of
merger had
Industrial City Bank & Trust Co.,13 Worcester, Mass.,
which had
and the Mechanics National Bank of Worcester, Worcester Mass. (1135), with
merged July 31, 1964, under the charter and title of
the latter bank (1135). The merged bank at the date
of merger had
Fair Lawn-Radburn Trust Co.s Fair Lawn,15 N.J., which
had
and National Community Bank of Rutherford, Rutherford, N J . (5005), with
merged July 31, 1964, under the charter and title of
the latter bank (5005). The merged bank at the date
of merger had
The Peoples-Farmers National Bank, Mifflin,12 Pennsylvania,
Mifflin, Pa. (9678), with
and the Russell National Bank of Lewistown, Lewistown,
Pa. (10506), which had
merged July 31, 1964, under the charter of the latter
bank (10506) and title "The Russell National Bank."
The merged bank at the date of merger had
The First National Bank of Waynesboro,14 Waynesboro, Va.
(7587), which had
and First & Merchants National Bank, Richmond, Va.
(1111), with
merged July 31, 1964, under the charter and title of the
latter bank (1111). The merged bank at the date of
merger had
The Peoples National Bank of Rock Hill, Rock ™ Hill, S.C.
(9407), which had.
and the Citizens & Southern National Bank of South
Carolina, Charleston, S.C. (14425), with
merged Aug. 1, 1964, under the charter and title of the
latter bank (14425). The merged bank at the date of
merger had.
The Ashland National Bank, Ashland, Pa. (5615), with
and Pennsylvania National Bank & Trust Co., Pottsville, Pa. (1663), which had
merged Aug. 7, 1964., under charter and title of the
latter bank (1663). The merged bank at the date of
merger had
,
The First National Bank of Mount Holly Springs, Mount
Holly Springs, Pa. (8493), with.
and Cumberland County National Bank & Trust Co.,
New Cumberland, Pa. (14542), which had
merged Aug. 7, 1964, under charter and title of the
latter bank (14542). The merged bank at the date of
merger had
The First National Bank of West Middlesex, West Middlesex, Pa. (6913), with
and First National Bank of Mercer County, Greenville,
Pa. (249), which had
merged Aug. 8, 1964, under the charter and title of the
latter bank (249). The merged bank at the date of
merger had
,
State Bank of Napparsee, Nappanee, Ind., with
and the First National Bank of Elkhart, Elkhart, Ind.
(206), which had
merged Aug. 15, 1964, under the charter of the latter
bank (206) and title of "The First National Bank of
Elkhart County." The merged bank at the date of
merger had
See footnotes at end of table.




Outstanding
capital stock

Surplus

Undivided profits
and reserves

Total assets

$100, 000

$100,000

$71,124

$4,105, 543

2, 625, 000

3, 600, 000

1, 350, 378

101,172,802

2, 750, 000

3, 700, 000

1, 396, 502

104, 628, 363

237, 600

260,000

188,723

8,211,694

1,200,000

2, 300, 000

1,031,175

50, 491, 697

1,410,370

2, 589, 630

1,217,497

58, 703, 392

600,000

1,200,000

530, 818

26, 365,293

3, 637, 500

4,000, 000

2, 445, 728

139,946,077

4,987, 500

5, 200, 000

2, 226, 548

166,311,369

100,000

400, 000

100,227

5, 545, 885

500,000

1,000,000

308, 338

19,149, 806
24, 669, 926

680, 000

1,400,000

328, 565

200, 000

450,000

299,571

12,138, 496

12,162, 300

17, 837, 700

7, 847, 357

445,919,279

12,482,300

18,267,700

7, 920, 726

457, 698, 818

300,000

1,000, 000

463, 808

18,541,535

3, 246, 650

9, 685, 350

1,351,960

175,232,427

3, 621, 650
125, 000

10, 878, 350
350,000

1, 547, 769
125,272

193, 690, 936
5,125, 778

1,050,000

1,500,000

590,014

52, 012, 755

1 1,100,000
7

1, 500, 000

416,383

56,164, 629

120, 000

240, 000

36, 010

4, 946, 697

900,000

1, 600, 000

399, 938

39, 528, 778

1,140, 000

1, 860, C O
O

295, 949

44, 475, 475

50,000

150, 000

163, 794

3, 724, 634

800,000

1, 000, 000

693, 435

33, 646, 698

920, 000
220, 000

1,150,000
280,000

787, 230
149, 058

37, 371, 333
9,207, 063

1,827,000

2, 273,000

1,185, 684

75,449,430

2,201,000

2,553, 000

1,180,742

84, 656, 493

195

TABLE B-12.—Mergers of national banks, or national and Stale banks, calendar 1964, with title and location, outstanding
capital stock, surplus, undivided profits and reserves, and total assets—Continued
Title and location oj bank

The Nashville Bank & Trust Go.,18 Nashville, Term., with..
and Third National Bank in Nashville, Nashville, Tenn.
(13103), which had
^
merged Aug. 18, 1964, under the charter and title of
the latter bank (13103). The merged bank at the date
of merger had
The Georgetown National Bank, Georgetown, Ky. (8579),
with.
and First National Bank & Trust Co., Georgetown, Ky.
(2927), which had
merged Aug. 29, 1964, under charter of the latter bank
(2927), and under title "First Georgetown National
Bank & Trust Co." The merged bank at the date of
merger had
Pocatello National Bank, Pocatello, Idaho19 (14859), with..
and the Idaho First National Bank, Boise, Idaho (1668),
which had
merged Sept. 4, 1964, under charter and title of the
latter bank (1668). The merged bank at the date of
merger had
The Branford Trust Co., Branford, Conn., with
and the 2
First New Haven National Bank, New Haven,
Conn., which had
merged Sept. 30, 1964, under charter and title of the
latter bank *. The merged bank at the date of merger
had
Peoples Bank of Stuarts Draft, Inc., Stuarts Draft, Va., with.
and National Bank & Trust Co. at Charlottesville,
Charlottesville, Va. (10618), which had
merged Sept. 30, 1964, under charter of the latter bank
(10618), and title "National Bank & Trust Co." The
merged bank at the date of merger had
The Citizens National Bank & Trust Co. of Oneonta,20
Oneonta, N.Y. (8920), with
and National Commercial Bank & Trust Co., Albany,
N.Y. (1301), which had
merged Oct. 2,1964, under charter and title of the latter
bank (1301). The merged bank at the date of merger
had
The Citizens National Bank of Corry, Corry, Pa. (4479),
with
and the Marine National Bank of Erie, Erie, Pa. (870),
which had
merged Oct. 2, 1964, under charter of the latter bank
(870), and with the title "Marine National Bank."
The merged bank at the date of merger had
Spokane National Bank, Spokane, Wash.2i (14866), with
and National Bank of Washington, Tacoma, Wash.
(3417), which had
merged Oct. 2, 1964, under charter and title of the
latter bank (3417). The merged bank at the date
of merger had
Community National Bank, Liberty, N.Y.22 (10037), with.,
and Marine Midland National Bank of Southeastern
New York, Poughkeepsie, N.Y. (465), which had
merged Oct. 9, 1964, under charter and title of the
latter bank (465). The merged bank at the date of
merger had
The Citizens National Bank of Poland, Poland, N.Y. (9804),
with
and the Oneida National Bank & Trust Co. of Central
New York, Utica, N.Y. (1392), which had
merged Oct. 16, 1964, under charter and title of the
latter bank (1392). The merged bank at the date
of merger had
See footnotes at end of table.

196




Outstanding
capital stock

Undivided profits
and reserves

Total assets

$1, 633, 300

$1, 700, 000

$1, 366, 897

$47, 981, 502

6, 000, 000

14,000,000

3, 258, 547

382,138,104

6, 735, 000

428,218,003

16,598,300

4, 625, 445

150, 000

200, 000

99, 536

5, 646, 609

300, 000

300, 000

201, 919

7, 812,134

500, 000
250, 000

500,000
75, 000

251,453
111,015

13,438,460
5,228, 838

6, 000, 000

9,000, 000

4, 673, 957

292, 692, 820

6, 097, 000
100,000

9,228,000
600, 000

4, 824, 524
144, 705

297, 862, 393
5,814,623

4, 722, 500

7, 700, 000

3, 373, 475

197,335,681

5,082, 500
59,160

7, 340, 000
185,000

3,518,178
35, 793

203,150,304
2, 442, 073

970, 365

2, 500, COO

1,296,249

56, 357, 858

1,029,525

2, 685,000

1,332,043

58, 772, 892

372, 600

530,000

127,128

13,273,644

7, 346, 205

19, 653, 795

4, 421, 092

455, 320,050

7, 765, 380

19,653,795

5, 031, 645

468, 482, 429

300, 000

500, 000

232,714

10, 963, 243

700, 000

1, 900, 000

267, 980

43, 002, 848

1,000,000
500, 000

2, 400, 000
150,000

500, 694
147,464

53, 966, 092
6,210,207

5, 600, 000

6,900 000

4, 529, 258

247,159,412

5, 858, 262
380, 000.

7,291,737
1, 253, 000

4, 676, 722
288, 391

253, 369, 620
26, 034, 886

1,600,000

3, 400, 000

1, 653, 543

104,687,940

2, 075, 000

4, 725, 000

1, 754, 343

130,740,826

50, 000

150,000

93, 823

2, 865, 897

2, 495, 700

8, 000, 000

3, 093, 973

167, 647, 231

2, 535, 700

8, 500, 000

2, 847, 797

170,513,128

TABLE B-12.—Mergers of national banks, or national and State banks, calendar 1964, with title and location, outstanding
stock, surplus, undivided pro/its and reserves, and total assets—Continued
Title and location of bank

Tennessee Bank & Trust Co., Houston, Tex., with
and Houston National Bank, Houston, Tex. (9353),
which had
merged Oct. 16, 1964, under charter and title of the
latter bank (9353). The merged bank at the date
of merger had
Marshall County Bank, Moundsville, W. Va., with
and First National Bank at Moundsville, Moundsville,
W. Va. (14142), which had
merged Oct> 17, 1964, under charter and title of the
latter bank (14142). The merged bank at the date
of merger had
First Security Bank of Twin Falls, Twin Falls, Idaho, with..
and First Security Bank of Idaho, National Association,
Boise, Idaho (14444), which had
merged Oct. 23, 1964, under charter and title of the latter
bank (14444) The merged bank at the date of merger had.
The Bank of Appomattox, Appomattox, Va.23, with
and the Fidelity National Bank, Lynchburg, Va. (1522),
which had
merged Oct. 24, 1964, under charter and title of the
latter bank (1522). The merged bank at the date
of merger had
The Christiana National Bank, Christiana, Pa. (7078),
with
and Lancaster County Farmers National Bank, Lancaster, Pa. (683), which had.
merged Oct. 27, 1964, under charter and title of the
latter bank (683). The merged bank at the date
of merger had
The Cargill Trust Co., Putnam,2* Conn., with
and Hartford National Bank & Trust Co., Hartford,
Conn. (1338), which had
,
merged Nov. 10, 1964, under charter and title of the
latter bank (1338). The merged bank at the date
of merger had
The Guilford Trust Co., Guilford, 2S Conn., with
and the Second National Bank of New Haven, New
Haven, Conn. (227), which had
merged Nov. 16, 1964, under charter and title of the
latter bank (227). The merged bank at the date
of merger had
Citizens State Bank, Aliquippa, Pa., with
and Western Pennsylvania National Bank, McKeesport,
Pa. (2222), which had
merged Nov. 21, 1964, under the charter and title of
the latter bank (2222). The merged bank at the
date of merger had
The National Bank of Lake Ronkonkoma, Lake Ronkonkoma, N.Y. (13130), with
and the Peoples National Bank of Long Island, Patchogue, N.Y. (12788), which had
merged Dec. 4, 1964, under the charter and title of the
latter bank (12788). The merged bank at the date
of merger had. ,
Hightstown Trust Co., East Windsor28 Township, N.J.,
with
and First Trenton National Bank, Trenton, NJ. (1327),
which had
merged Dec. 11, 1964, under the charter and title of
the latter bank (1327). The merged bank at the date
of merger had
First National Bank & Trust Co. of27 Hanover, Hanover,
Pa. (187), with.
and National Bank & Trust Co. of Central Pennsylvania,
York, Pa. (694), which had
merged Dec. 14, 1964, under charter and title of the
latter bank (694). The merged bank at the date of
merger had
See footnotes at end of table.




Undivided profits
and reserves

Outstanding
capital stock

Total assets

$52,341,796

$2, 300, 000

$2, 300, 000

$928, 334

2, 862, 000

2, 862, 000

638, 326

5,162,000
100, 000

5,162,000
170,000

1,566,661
60, 958

140,745,393
2,512,703

150,000

150,000

159, 333

5,946,175

150, 000
250, 000

150,000
135,000

159,701
96, 973

8,556,138
3, 865, 088

4, 470, 586

264, 478, 563

4, 452, 559
122,757

268, 343, 651
3, 948, 099

6, 657, 000
6, 804, 500
75, 000

9, 843, 000
10,195,500
150,000

89, 292, 080

1,925,000

3, 075, 000

436, 443

78,109,431

2, 025, 000

3, 225, 000

534, 200

81, 778, 300

160,000

66, 663

60, 000
2, 470, 320
2, 536, 320
100, 000

2,636,838

5, 529, 680

1,658,726

95, 940, 893

5, 963, 680
400, 000

1,445,389
96, 959

98, 577, 731
8, 561, 750

13, 600, 000

31,400,000

11,513,080

587, 874, 261

13,740,000
180,000

31,400,000
320,000

11,970,040
107, 851

596,436,011
6,911,120

2, 959, 662

4, 598, 375

1, 399, 508

117,886,797

3,372,162
300, 000

4, 685, 875
300, 000

1,384,445
126, 927

124,816,331
4,168, 838

8,892,910

16,607,090

3,711,920

548, 630, 678

9,132,910

16,967,090

3, 838, 847

552, 799, 516

275, 000

475, 000

279, 395

15,536,617

474, 675

1, 500, 000

621, 371

35, 452, 546

680, 925

1,975,000

969, 517

50, 989,163

250, 000

600,000

282,980

23, 547, 545

4, 725, 000

7, 275, 000

4, 268, 765

225, 260, 467

5,047,500

7, 952, 500

4,401,746

248, 808, 012

1,000,000

2, 000, 000

775, 465

5, 667, 020

6, 832, 980

3, 762, 046

165, 853, 937

7, 067, 020

8, 832, 980

4,137,511

196,020,093

30,166,156

197

T A B L E B—12.—Mergers of national banks> or national and State banks, calendar 7964, with title and location, outstanding
capital stock, surplus, undivided profits and reserves, and total assets—Continued
Title and location of bank

The Citizens National Bank of Govington, Govington, Va.
(5326), with
and the First National Exchange Bank of Virginia,
Roanoke, Va. (2737), which had
merged Dec. 15, 1964, under the charter and title of
the latter bank (2737). The merged bank at the date
of merger had
The Farmers National Bank of Bloomsburg, Bloomsburg,
Pa. (4543), with
and Miners National Bank of Wilkes-Barre, WilkesBarre, Pa. (13852), which had
merged Dec. 16, 1964> under charter and title of the
latter bank (13852). The merged bank at the date
of merger had
The Garden State National Bank of Teaneck, Teaneck,
N J . (12402), with
and National Community Bank of Rutherford, Rutherford, NJ- (5005), which had
merged Dec. 18, 1964, under the charter and title of
the latter bank (5005). The merged bank at the date
of merger had
The First National Bank in Gadsden, Gadsden, Ala. (13728),
with
and State National Bank of Alabama, Decatur, Ala.
(14414), which had
merged Dec. 19, 1964, under charter and title of the
latter bank (14414). The merged bank at the date
of merger had
The Sciota Bank, Commercial Point, Ohio, with
and the First National Bank of Circleville, Circleville,
Ohio (118), which had
merged Dec. 29, 1964, under the charter and title of
the latter bank (118). The merged bank at the date
of merger had
The Commercial National Bank of Spartanburg,28 Spartanburg, S.C. (14211), with
and the First National Bank of South Carolina of Columbia, Columbia, S.C. (13720), which had
merged Dec. 31,1964, under charter of the First National
Bank of South Carolina of Columbia (13720), and
under title "The First Commercial National Bank of
South Carolina." The merged bank at the date of
merger had
The Windsor County National Bank of Windsor,29 Windsor,
Vt. (13685), with
and Vermont National & Savings Bank, Brattleboro,
Brattleboro, Vt. (1430), which had
merged Dec. 31, 1964, under charter of the latter bank
(1430), and title "Vermont National Bank." The
merged bank at the date of merger had.
1 2
' With 1 outside branch.
3.4,5 with 1 outside office.
«With 2 outside offices.
7
Includes the sale of 12,500 additional shares of common
stock, par $10.
8
With 2 outside offices.
9 With 1 outside office.
M With 1 local office.
11
With 7 local offices.
1 With 1 local office.
2
13 With 1 local and 1 outside office.
M
With 1 local office.
is With 3 local branches.

198




Outstanding
capital stock

Surplus

Undivided profits
and reserves

Total assets

$125,000

$1,000,000

$106,145

$15,231,684

6, 279, 510

11,125,010

2,240, 043

245,641,387

6, 779, 510

260, 492, 687

12,125,010

1,971,188

100, 000

600,GOO

263, 868

8, 629, 066

2, 775, 000

5,000,000

2, 548,086

107, 470, 802

3,025, 000

6,000, 000

2,134, 515

116,099,867

500, 000

1,100, 000

547, 737

37, 758, 612

4, 987, 500

5,200, 000

1, 953, 636

172,029,741

6,237, 500

6, 800, 000

1,160,204

209, 631, 312
18,672,359

500,000

500, 000

2, 000,000

4, 000, 000

2,192, 856

117,934,892

2, 500, 000
25,000

4, 500,000
25, 000

2, 961,192
16,141

136, 357, 300
593, 387

400,000

191,521

9, 526, 219

400, 000

209,150

768,232

239,162

10,119,606

825, 000

1, 300, 000

563,146

35,125, 953

2, 553, 505

5, 446, 495

1, 399, 673

131, 858, 382

3,234,130

6, 765, 870

1, 605, 730

165, 050,102

227, 650

100,000

434, 055

5, 659, 651

301, 554, 000

1, 096, 000

386, 042

44,284, 550

301,784, 000

1,196,000

678, 801

49, 964, 477

100, 000

is With 2 local branches.
17
Includes the sale of 5,000 additional shares of common
stock, par $10.
18,19,20.21 With 1 local branch.
22
With 2 local branches.
23
With 1 local branch.
24
With 1 outside branch.
25
With 1 local branch.
28
With 2 outside branches,,
27
With 1 outside branch.
23
With 8 outside branches.
29
With 1 outside branch.
3
° Includes $704,000 preferred capital stock.

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch
Branches opened for business
Title and location of bank

Charter
No.

Local

252

11753
3041
3185
6380
14414
5249
4067
15402

Other
than
local

Total

530

782

The Commercial National Bank of Anniston ..
The First National Bank of Anniston
The First National Bank of Birmingham
First National Bank of Decatur
State National Bank of Alabama, Decatur
The First National Bank of Dothan
The First National Bank of Huntsville
Baldwin National Bank of Robertsdale

3728 I First National Bank of Arizona, Phoenix
14324 ! The Valley National Bank of Arizona, Phoenix.
7346
14606
14000
13949
13958
15313
10004
12156
7138

The First National Bank of Fayettevilie
First National Bank of Jonesboro
The Commercial National Bank of Little Rock.
The First National Bank in Little Rock
Union National Bank of Little Rock
First National Bank in Osceola
National Bank of Commerce of Paragould
The Peoples National Bank of Stuttgart
The State National Bank of Texarkana.
CAT IFORNIA

14670
13348
14695
15089
15239
14823
14632
2491
14997
15323
6919
6268
8181
14998
15276
15174
10391
13044
9655
1741
*14939
2158
15047
14891
15217
15149
13178
15092
*14980

Community National Bank of Kern County, Bakersfield
Beverly Hills National Bank, Beverly Hills
City National Bank, Beverly Hills
First National Bank of Daly City
Gateway National Bank, El Segundo
Valley National Bank, Glendale
First National Bank of Long Beach
Security First National Bank, Los Angeles
Wilshire National Bank, Los Angeles
Civic National Bank, Marina Del Rey
Central Valley National Bank, Oakland
First National Bank and Trust Company, Ontario
The First National Bank of Orange County, Orange
Security National Bank of Monterey County, Pacific Grove
Palm Springs National Bank, Palm Springs
Sierra National Bank, Petaluma
United States National Bank, San Diego
Bank of America National Trust and Savings Association, San Francisco.
The Bank of California, National Association, San Francisco
Crocker-Citizens National Bank, San Francisco
Golden Gate National Bank, San Francisco
The First National Bank of San Jose
Redwood National Bank, Sari Rafael
Santa Barbara National Bank, Santa Barbara, .
Tahoe National Bank, Stateline....
Tiburon National Bank, Tiburon
,
The First National Bank of Vista
,
Security National Bank of Contra Costa, Walnut Creek
San Francisco National Bank, San Francisco

13
1
1
3
1
1
2
1
1
3
23
4
25

1
1
1
1
1
1
1
15
1
1
3
1
1
2
1
1
4
23

1
1

CONNECTICUT

••A f :




[ Report
cut, Bridgeport
••>al Bank in the District of Columbia.

199

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches opened for business
Title and location of bank

Local

CONNECTICUT—continued
Hartford National Bank & Trust Co., Hartford
The First New Haven National Bank, New Haven.
The Second National Bank of New Haven
The Tradesmens National Bank of New Haven
Lincoln National Bank of Stamford
The Waterbury National Bank, Waterbury
DISTRICT OF C0LLUMB1A '

District of Columbia National Bank, Washington.
The First National Bank of Washington
Public National Bank, Washington
The Riggs National Bank of Washington, D.G. . .
GEORGIA

The National Bank of Athens
The First National Bank of Atlanta
The National Bank of Fitzgerald
The Citizens and Southern National Bank, Savannah.
Hawaii National Bank, Honolulu.

First Security Bank of Idaho, National Association, Boise.
The Idaho First National Bank, Boise

The First National Bank of Danville
The First National Bank of Elkhart County, Elkhart
The Citizens National Bank of Evansville
Fort Wayne National Bank, Fort Wayne
Bank of Indiana, National Association, Gary
Gary National Bank, Gary
The Calumet National Bank of Hammond
Mercantile National Bank of Hammond
American Fletcher National Bank & Trust Co., Indianapolis.
Merchants National Bank & Trust Co. of Indianapolis
First National Bank, Kokomo
Lafayette National Bank, Lafayette
American National Bank & Trust Co. of Muncie
The Second National Bank of Richmond
The Farmers National Bank of Shelbyville
Terre Haute First National Bank, Terre Haute
The American National Bank of Vincennes
The First National Bank in Wabash
First National Bank of Warsaw
The Washington National Bank, Washington

The Centerville National Bank, Centerville
First National Bank of Davenport
East Des Moines National Bank, Des Moines
The Montgomery County National Bank of Red Oak.
KENTUCKY

The First National Bank & Trust Co. of Covington
First Georgetown National Bank & Trust Co., Georgetown.
* 1 branch also authorized for a Nonnational Bank in the District of Columbia.

200




Other
than
local

Total

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches openedfor business
Title and location of bank

Local

Other
than
local

KENTUCKY—continued
The Harlan National Bank, Harlan
Citizens Union National Bank & Trust Co., Lexington.
The Second National Bank & Trust Co. of Lexington..
Liberty National Bank & Trust Co. of Louisville
The Newport National Bank, Newport..

Louisiana National Bank of Baton Rouge
First National Bank of Jefferson Parish, Gretn a
The National Bank of Commerce in Jefferson Parish.
The First National Bank of Lafayette
The Lakeside National Bank of Lake Charles
National American Bank of New Orleans
LaFourche National Bank of Thibodaux
First National Bank of West Monroe
MAINE

First-Manufacturers National Bank of Lewiston and Auburn, Lewiston.
MARYLAND

The Farmers National Bank of Annapolis
The First National Bank of Maryland, Baltimore
Maryland National Bank, Baltimore
National City Bank of Baltimore
State National Bank of Bethesda.
The Central National Bank of Maryland, Hillandale
The Citizens National Bank of Laurel
Citizens National Bank of Southern Maryland, Lexington Park
The First National Bank of North East.
The First National Bank of Oakland
The Garrett National Bank in Oakland
American National Bank of Maryland, Silver Spring
Peoples National Bank of Maryland, Suitland
Metropolitan National Bank, Wheaton
MASSACHUSETTS

The Arlington National Bank, Arlington
Suburban National Bank of Arlington
The First National Bank of Boston
The National Shawmut Bank of Boston
New England Merchants National Bank of Boston.
Plymouth-Home National Bank, Brockton
The Lincoln National Bank of Chelsea
The Everett National Bank, Everett.
Middlesex County National Bank, Everett.
Merrimack Valley National Bank, Haverhill
The Hudson National Bank, Hudson
Union National Bank, Lowell
Security-Danvers National Bank, Lynn
First National Bank of Natick
First National Bank of Cape Cod, Orleans
First Agricultural National Bank of Berkshire County, Pittsfield.
South Shore National Bank, Quincy
Hampshire National Bank of South Hadley
Third National Bank of Hampden County, Springfield
The First-Machinists National Bank of Taunton
The Wellesley National Bank, Wellesley
Blackstone Valley National Bank of Whitinsville
The Mechanics National Bank of Worcester
Worcester County National Bank, Worcester
The First Nationzil Bank of Yarmouth, Yarmouth Port




201

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches opened for business
Title and location of bank
Local

Peoples National Bank & Trust Co. of Bay City
Farmers & Merchants National Bank in Benton Harbor....
First National Bank of Big Rapids
City National Bank of Detroit
Manufacturers National Bank of Detroit
Michigan Bank, National Association, Detroit
National Bank of Detroit
City Bank & Trust Co., National Association, Jackson
The American National Bank & Trust Co. of Kalamazoo. .
The First National Bank & Trust Co. of Kalamazoo
First National Bank of Lake City
Michigan National Bank, Lansing
Livonia National Bank, Livonia.
Central National Bank of St. Johns
National Bank of Southfield
First National Bank, Sturgis
The First National Bank of Three Rivers. .
First National Bank of Wyoming
The National Bank of Ypsilanti

First National Bank of Clarksdale
National Bank of Commerce of Corinth.
GulfNationalBankofGulfport
First National Bank of Vicksburg
The Delta National Bank of Yazoo City.

The Boone County National Bank of Columbia.
The Third National Bank of Sedalia
NEVADA

First National Bank of Nevada, Reno, Nev...
NEW HAMPSHIRE

The Mechanicks National Bank of Concord
Strafford National Bank, Dover
The Rockingham National Bank of Exeter
Farmington National Bank, Farmington
The Cheshire National Bank of Keene
The Laconia National Bank, Laconia
The Peoples National Bank of Laconia
The Amoskeag National Bank of Manchester
The Manchester National Bank, Manchester
The Indian Head National Bank of Nashua
The Second National Bank of Nashua
The First National Bank of Portsmouth
First Somersworth-Rollinsford National Bank, Somersworth
The Citizens' National Bank of Tilton
NEW JERSEY

First Merchants National Bank, Asbury Park
The First National Bank of Somerset County, N.J., Bound Brook
First Camden National Bank & Trust Company, Camden
Cherry Hill National Bank, Cherry Hill Township
First Clinton National Bank, Clinton
The First National Bank of Cranbury
Citizens National Bank of Englewood
_
The Flemington National Bank & Trust Co., Flemington
The Hunterdon County National Bank of Flemington

202




Other
than
local

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches opened for business
Title and location of bank

Charter
No.

NEW JERSEY—continued
15255 First Bank & Trust Co., National Association, Fords
14457 Haddonfield National Bank, Haddonfield
8227 The Hardyston National Bank of Hamburg
8627 The First National Bank & Trust Go. of Kearny
12022 I Peoples National Bank of Camden County, Laurel Springs,. .
15360 ! Madison National Bank, Madison
15023 The Short Hills National Bank, Millburn Township
1113 I The First National Iron Bank of Morristown
15297 New Jersey National Bank & Trust Co., Neptune
1316 National Newark & Essex Bank, Newark
925 The Sussex & Merchants National Bank of Newton
5981 The First National Bank & Trust Co., of Paulsboro
1239 The Phillipsburg National Bank & Trust Co., Phillipsburg.. .
2257 The Monmouth County National Bank, Red Bank
5005 National Community Bank of Rutherford
3922 The City National Bank & Trust Co. of Salem
, .. ..
15375 Peoples National Bank of Sparta
6692 Citizens National Bank of Morris County, Succasunna
2509 The First National Bank of Toms River, N.J
1327 First Trenton National Bank, Trenton
7265 The First National Bank of Williamstown
NEW MEXICO

I
6597
8397
15312
14628
5220

The First National Bank of Belen
First National Bank of Curry County, Clovis...
First National Bank of Rio Arriba, E s p a n o l a . . .
First National Bank of Hobbs
The First National Bank of Roswell
NEW YORK

National Commercial Bank & Trust Co., Albany
First-City National Bank of Binghamton, N.Y
Liberty National Bank & Trust Co., Buffalo.
The First National Bank of Cairo
United National Bank, Callicoon
The St. Lawrence County National Bank, Canton
Northern Westchester National Bank, Chappaqua
Tinker National Bank, East Setauket
The Endicott National Bank, Endicott
T h e Hampton Bays National Bank, Hampton Bays
Security National Bank of Long Island, Huntington
The Kerhonkson National Bank, Kerhonkson
The State of New York National Bank, Kingston
The Sullivan County National Bank of Liberty
County National Bank, Middletown
'bounty National Bank of Long Island, Mineola
Franklin National Barik. Mineola
v
irst Westchester National Bank, New Rochelle
r
irst National City 15 ink, New York
The Meadow Brook National Bank. Mew York
^oy;<! .'"atioriai itonk of Ne»v York
The Xorlh Creek National IVmk, North Creek
9716
'•'Vipp-m Zee Nation u 3an ; i, Wack
1-V734
r
h e Propk-j N iijoafn M mil rf Long Island, ?a*chogue
12788
081 The Stis^my >">Lon;:I Bnnk of Pine Plains
\iarine Midland Na'-ion-il .'a:ik of .Snuthcns't'
Xew York, P'K^hkcepsie..
465
I he Mohawk [National bank of Sclu'iioctady
1.126
5.V)0 "'"he Fir>t "Cational Bank of Spring V iliev
: .ocUand National B mk, Suilern~
5S46
• incoln N:^ion.tl Bank .-c "Ir.-^t Co > Central Xcvv York, Syracuse
f
1 -42 '. .:e Af-Trchatiu, Xac<"cn;i! Bank ik 'i^^i Co. of Syrac.uM*
' \c Uiilo-j Nation,.•! -xi'ix of ' i'roy
is- C^:it*icl \ V"'J!^ '!i:i! '.?.;i"k & Trust '. :; of Centra! I'^ew York, Ulici

1301
202
15080
12586
13590
8531
12746
11511
13004
12987
6587
10855
955
4925
13956
14951
12997
13955
1461
7703
15029

•

• : ,

^




2 ;
i !

iI

2
1
1

203

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches openedfor business
Title and location of bank

Local

NEW YORK—continued
Valley National Bank of Long Island, Valley Stream.
The Valley National Bank, Wallkill, N.Y
National Bank of Westchester, White Plains
NORTH CAROLINA

First Union National Bank of North Carolina, Charlotte
North Carolina National Bank, Charlotte
First National Bank of Catawba County, Hickory
First National Bank of Eastern North Carolina, Jacksonville..
The First National Bank of Leaksville
Southern National Bank of North Carolina, Lumberton
The First National Bank of Morganton
The First National Bank of Anson County, Wadesboro
NORTH DAKOTA

The Dakota National Bank of Bismarck.
First National Bank in Grand Forks

The First National Bank of Ashland
The Farmers National Bank & Trust Co. of Ashtabula
Farmers & Merchants National Bank in Bellaire
The First National Bank of Chillicothe
The First National Bank of Circleville
The Capital National Bank, Cleveland
Central National Bank of Cleveland
The National City Bank of Cleveland
Society National Bank of Cleveland
The City National Bank & Trust Co. of Columbus
The Huntington National Bank of Columbus
The National Bank of Dayton
The Third National Bank & Trust Co. of Dayton, Ohio
The Winters National Bank & Trust Co. of Dayton
The Portage County National Bank of Kent
First National Bank & Trust Co. of Lima
The Central Security National Bank of Lorain County, Lorain.
The Lorain National Bank, Lorain
The Park National Bank of Newark
The First National Bank & Trust Co. of Ravenna
The Second National Bank of Ravenna
The First Central National Bank of St. Paris
The Peoples' National Bank of Wapakoneta

Fort Sill National Bank, Fort Sill
Founders National Bank of Oklahoma City.
Emerald National Bank, Bethel-Danebo
First National Bank of Oregon, Portland
United States National Bank of Oregon, Portland.
First National Bank of Roseburg
PENNSYLVANIA

The
The
The
The

First National Bank of Allentown..
National Deposit Bank of Arnold..
First National Bank in Bedford
National Bank of Boyertown

204




Other
than
local

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches opened for business
Charter I
No. !

Title and location of bank
Local

Other
than
local

PENNSYLVANIA—continued
10232 The Central Pennsylvania National Bank of Claysburg.
575 The National Bank of Chester Valley, Coatesville
5019 DuBois Deposit National Bank, DuBois
5084 The First National Bank of Ebensburg
870 Marine National Bank, Erie.
14051 | First National Bank of Export
5920 I The First National Bank of Fredericktown
5454 The Freedom National Bank, Freedom
14055 First National Bank in Greensburg
249 First National Bank of Mercer County, Greenville
580 The Harrisburg National Bank & Trust Co., Harrisburg
31 First-Grange National Bank of Huntingdon
683 Lancaster County Farmers National Bank, Lancaster
5502 The First National Bank of Leechburg
10506 The Russell National Bank, Lewistown
4625 The National Bank of McKeesport
2222 Western Pennsylvania National Bank, McKeesport
5496 The First National Bank of Milford.
2223 County National Bank of Montrose
5077 Nazareth National Bank & Trust Co., Nazareth
14542 Cumberland County National Bank & Trust Co., New Cumberland.
723 Central-Penn National Bank of Philadelphia
539 The Philadelphia National Bank, Philadelphia
15422 Provident National Bank, Philadelphia
6301 Mellon National Bank & Trust Co., Pittsburgh
252 Pittsburgh National Bank, Pittsburgh
,
705 The Union National Bank of Pittsburgh
1663 Pennsylvania National Bank & Trust Co., Pottsville
77 Northeastern Pennsylvania National Bank & Trust Co., Scranton. . .
8764 The McDowell National Bank of Sharon
12261 The Peoples National Bank of State College.
11866 First National Bank & Trust Co., Waynesboro
328 Northern National Bank & Trust Co., Wellsboro
13852 Miners National Bank of Wilkes-Barre
694 National Bank & Trust Co. of Central Pennsylvania, York
|

1302

RHODE ISLAND

Industrial National Bank of Rhode Island, Providence
SOUTH CAROLINA

14425
2044
13720
15229
14950
14341

The Citizens & Southern National Bank of South Carolina, Charleston.
The South Carolina National Bank of Charleston
The First Commercial National Bank of South Carolina, C o l u m b i a . . . .
First State National Bank, Jackson
The First National Bank of Laurens
The Davis National Bank of Mullins

15025 I First National Bank of St. George.
9533 ! The First National Bank of Sharon.
TENNESSEE

3341
14760
14710
8443
13635
14279
336
13681
13349
8025
9319

The First National Bank of Athens
First National Bank of Clinton
First Farmers & Merchants National Bank of Columbia.
The Harpeth National Bank of Franklin.
The Hamilton National Bank of Johnson City
The Blount National Bank of Maryville
The First National Bank of Memphis
National Bank of Commerce in Memphis
Union Planters National Bank of Memphis.
The Hamilton National Bank of Morristown
The First National Bank of Mount Pleasant




205

TABLE B-13.—Number of domestic branches of national banks opened for business, calendar 1964, by States, banks,
and type of branch—Continued
Branches opened for business
Title and location of bank

Local

TENNESSEE—continued
Third National Bank in Nashville
The First National Bank of Rutherford
The Traders National Bank of Tullahoma.

The First National Bank of Layton
First Security Bank of Utah, National Association, Ogden.
Zions First National Bank

The Bradford National Bank, Bradford
Vermont National Bank, Brattleboro
The Randolph National Bank, Randolph
The First National Bank of White River Junction.

The Colonial National Bank of Alexandria
Mount Vernon National Bank & Trust Go. of Fairfax County, Annandale.
Security National Bank, Baileys Crossroads
National Bank & Trust Co., Charlottesville
The Mountain National Bank of Clifton Forge
The Covington National Bank, Covington
The Second National Bank of Culpeper
The National Bank of Fairfax
National Bank of Commerce of Fairfax County, Falls Church
The First National Bank of Galax
The Farmers and Merchants National Bank of Hamilton
The Rockingham National Bank of Harrisonburg
Citizens National Bank of Herndon
The Fidelity National Bank, Lynchburg
The National Bank of Manassas
Seaboard Citizens National Bank, Norfolk
Virginia National Bank, Norfolk
The Wise County National Bank, Norton
The First and Merchants National Bank of Radford
The Richlands National Bank, Richlands
First and Merchants National Bank, Richmond
Richmond National Bank & Trust Co., Richmond
The Colonial-American National Bank of Roanoke
The First National Exchange Bank of Virginia, Roanoke
First National Bank of Vienna
WASHINGTON

Tri-Cities National Bank, Pasco
First National Bank in Port Angeles
The National Bank of Commerce of Seattle
The Pacific National Bank of Seattle
Peoples National Bank of Washington in Seattle.
Seattle-First National Bank, Seattle
Old National Bank of Washington, Spokane....
National Bank of Washington, Tacoma
The Puget Sound National Bank of Tacoma
Guaranty National Bank of White Center

Racine County National Bank, Franksville.
The First National Bank in Menomonie

206




Other
than
local

TABLE B-14.—Number of domestic branches of national banks closed, calendar 1964, by states, banks, and type of branch
Branches closed
Charter
No.

Title and location of bank
Other
than local

Local

Total: 33 banks

Total

26

50

1
1
2

1
1
2

2

24

1
2

CALIFORNIA

6919
10391
13044

Central Valley National Bank, Oakland
United States National Bank, San Diego
Bank of America National Trust and Savings Association, San Francisco

1559
13068

The First National Bank of Atlanta

GEORGIA

.

1

KENTUCKY

3832

The First and Farmers National Bank of Somerset

1

1

1

1

LOUISIANA

13689

The National Bank of Commerce in New Orleans
MARYLAND

1413
13776
14846

The First National Bank of Maryland Baltimore
The Garrett National Bank in Oakland
National Bank of Maryland, Silver Spring

2
1
1

2
1
1

1

1

MASSACHUSETTS

779

Plymouth-Home National Bank Brockton
MICHIGAN

13820

The American National Bank and Trust Company of Kalamazoo

1

1

1

1
1

1

1

MISSOURI

9042
6272

The American National Bank of St. Joseph .
.
The Tootle-Enright National Bank, Saint Joseph
NEBRASKA

14340

C o m m e r c i a l N a t i o n a l B a n k & T r u s t C o m p a n y ,
NEW

12195

G r a n d

I s l a n d . . .

. ,

JERSEY

The First National Bank of Park Ridge
NEW

2

7503
13438

The First National Bank of Hagerman
Hot Springs N/B, Truth or Consequences

15080
12586
5271
13080
1461

Liberty National Bank and Trust Company Buffalo
T h e First National Bank of Cairo
The First National Bank of Mount Vernon
T h e Bensonhurst National Bank of Brooklyn in New York
First National City Bank, New Y o r k . . .
...

13761

North Carolina National Bank, Charlotte

NEW

2

1

1
1

2
2

1
2
3
1
1

3

4

MEXICO

1

YORK

1

1

NORTH CAROLINA




1

207

TABLE B-14.—Number of domestic branches of national banks closed, calendar 1964, by states, banks, and type of
branch—Continued
Branches closed
Charter
No.

Title and location of bank
Other
than local

Local

Total

OHIO

1

7744

1

PENNSYLVANIA

1233
213
77

Easton National Bank & Trust Co Easton
Second National Bank of Philadelphia
.
. .
Northeastern Pennsylvania National Bank & Trust Co., Scran ton

1302

Industrial National Bank of Rhode Island, Providence

1
4

1

1
4
1

1

1

1

1

RHODE ISLAND

SOUTH CAROLINA

14425

The Citizens & Southern National Bank of South Carolina, Charleston
TENNESSEE

13681
3614

1
1

1
1

The First National Bank of Sparta
VERMONT

3484

The First National Bank of White River Junction

1

1

1

4

VIRGINIA

13775

208




3

TABLE B-15.—Principal assets and liabilities of national banks, by deposit size, December 1963 and 1964
[Dollar amounts in millions]
Deposits

Loans and securities
Number
of banks
Total

Cash, balances with
other banks, Real esLoans and U.S. Govincluding
Other
tate
discounts*
ernment
assets
and Fed- obligations, bonds and reserves
direct and securities with Federal funds
guaranteed
eral Resold
serve banks

Total
assets

Capital
stock f

Surplus,
undivided
profits,
and
reserves

Total

Demand

Time and
Savings

$9, 519 $150,823

$89, 389

$61,434

1963
4, 615 $135, 990

Total
Banks with deposits of—
Less than $1.0
$1.0 to $1.9
$?.O to $4.9
$5.0 to $9.9
$10.0 to $24.9
$25.0 to $49.9
$50.0 to $99.9
$100.0 to $499.9
Over $500.0

$83, 388

$33, 384 $19,218

$28, 635

$2, 595 $170, 233

$4, 029

132
388
1,316
1,145
935
329
167
164
39

88
565
4,205
7, 585
13, 379
10, 579
10,854
31,966
56, 769

47
305
2,209
3,984
7,233
5,831
6,176
20, 328
37, 275

36
214
1,489
2,516
4, 144
3,226
3, 171
7,550
11,037

5
45
507
1,084
2,003
1,521
1,507
4,088
8,457

32
122
801
1,331
2,260
1,773
1,917
7,673
12, 726

3
12
80
140
274
224
208
678
976

123
702
5,100
9,082
16,037
12,739
13,257
41,052
72, 143

15
37
139
205
363
303
315
965
1,688

17
66
394
610
946
693
704
2, 212
3,877

91
593
4, 526
8, 166
14,450
11,456
11,895
36, 552
63, 095

68
385
2,704
4, 604
7, 977
6,470
7,019
23, 720
36, 441

23
207
1,822
3,562
6,472
4,985
4, 876
12, 832
26,654

4, 773

149, 944

95, 577

33, 537

20, 830

34, 066

2,789

190,113

4,790

10, 258

169,617

98, 660

70, 957

114
394
1, 303
1, 181
1,029
339
185
176
52

79
572
4, 107
7,707
14,662
10,715
11,502
32, 328
68, 271

44
323
2,276
4,229
8,341
6,209
6, 696
20, 969
46, 491

32
209
1, 370
2,393
4, 128
2, 891
3, 136
7,147
12,231

3
40
462
1,085
2, 194
1,615
1,670
4,211
9, 549

26
133
830
1,433
2,671
1,929
2, 311
8,223
16, 509

5
15
82
150
301
220
227
655
1,133

112
725
5,048
9,342
17, 801
13, 039
14,210
41,793
88, 042

15
44
163
216
409
304
342
1,058
2,239

18
70
372
585
1,008
669
728
2,107
4,701

78
604
4,466
8,437
16, 100
11,778
12, 831
37,600
77, 723

57
391
2,619
4,659
8,768
6,524
7,307
23,712
44, 622

20
213
1,847
3,778
7,332
5,254
5,524
13, 888
33,101

1964
Total
Banks with deposits of—
Less than $1.0.
$1.0 to $1.9
$2.0 to $4.9
$5.0 to $9.9
$10.0 to $24.9
$25.0 to $49.9
$50.0 to $99.9
$100.0 to $499.9
Over $500.0

^Includes rediscounts and overdrafts,
flncludes capital notes and debentures.
NOTE : Data may not add to totals because of rounding.




TABLE B-16,—Dates of reports of condition of national banks, 1914-1964
[For dates of previous calls, see AR report for 1920, vol. 2, table No. 42, p. 150]
Feb.




Apr.

May

4

13

210

Man

""io"

28
3

31
23

July

Aug.

Sept.

30
1
1
1
10
12
4

4
7
5
4
4

28
21

June

5

12

23
30
20
29
30
30
30
30
30
30
30
30
29
30
30
30
30

27
27
25

5

10
28

i
o
3

4
4

31
31
31
31
30

30
25
17

31
1

29
30

30
30
30
29

28

30

24

13
20
12
11
24
9
31
20
15
11
10
14
4
12
15

12
26
18
15

31
30
31

2

30
30

31
31
31

18

30
31

30
30
29
30
30
30
30
30
30
30
30
30
30
6
23
10
15
30
30
29
30

31
31

31

31
7
29
26

4
4

31
27
31
31
31
29
31
29
31
^1

31

4
24
29

30

Dec.

31
10
17
20
1
17
15

12
8
6
15
14

30

28

Nov.

31

31

30
6
12

Oct.

CO CO C"

1914
1915
1916
1917
1918
1919 . . . .
1920
1921
1922
. . .
1923
1924
1925
1926
...
...
1927
1928
1929
1930
. . .
1931
1932
1933.
1934
1935
1936
1937
1938
1939
.
. . .
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
...
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964 . . .

Jan.

£ to to

Tear

30
6
1
5*
30

4
10

31
31
31
31
30
31
31
31

7
5

31

11

31
31

6
3

31
31
30
28
20
31

26
24
27
28

30
1

31
31

Act of Feb. 25, 1863, provided for reports of condition on
the 1st of each quarter before commencement of business.
Act of June 3, 1864—1st Monday of January, April, July,
and October, before commencement of business, on form prescribed by Comptroller (in addition to reports on 1st Tuesday
of each month showing condition at commencement of business in respect to certain items; i.e., loans, specie, deposits,
and circulation).
Act of Mar. 3, 1869, not less than 5 reports per year, on form
prescribed by Comptroller, at close of business on any past date
by him specified.
Act of Dec. 28, 1922, minimum number of calls reduced from
5 to 3 per year.
Act of Feb. 25, 1927, authorized a vice president or an
assistant cashier designated by the board of directors to verify
reports of condition in absence of president and cashier.
Act of June 16, 1933, requires each national bank to furnish
and publish not less than 3 reports each year of affiliates other
than member banks, as of dates identical with those for which
the Comptroller shall during such year require reports of
condition of the bank. The report of each affiliate shall contain such information as in the judgment of the Comptroller
shall be necessary to disclose fully the relations between the
affiliate and the bank and to enable the Comptroller to inform
himself as to the effect of such relations upon the affairs of the
bank.
Sec. 21 (a) of the Banking Act of 1933 provided, in part,
that after June 16, 1934, it would be unlawful for any private




bank not under state supervision to continue the transaction
of business unless it stibmitted to periodic examination by the
Comptroller of the Currency or the Federal Reserve bank of the
district, and made and published periodic reports of conditions
the same as required of national banks under sec. 5211,
U.S.R.S. Sec. 21(a) of the Banking Act of 1933, however,
was amended by sec. 303 of the Banking Act of 1935, approved
Aug. 23, 1935, under the provisions of which private banks
are no longer required to submit to examination by the Comptroller or Federal Reserve bank, nor are they required to make
to the Comptroller and publish periodic reports of condition.
(5 calls for reports of condition of private banks were made
by the Comptroller, the first one for June 30, 1934, and the
last one for June 29, 1935.)
Sec. 7(a)(3) of the Federal Deposit Insurance Act (Title
12, U.S.C., sec. 1817(a)) of July 14, 1960, provides, in part,
that, effective Jan. 1, 1961, each insured national bank shall
make to the Comptroller of the Currency 4 reports of condition annually upon dates to be selected by the Comptroller, the
Chairman of the Board of Governors of the Federal Reserve
System, and the Chairman of the Board of Directors of the
Federal Deposit Insurance Corporation, or a majority thereof.
2 dates shall be selected within the semiannual period of January to June, inclusive, and 2 within the semiannual period of
July to December, inclusive. Sec. 161 of Title 12 also provides that the Comptroller of the Currency may call for additional reports of condition, in such form and containing such
information as he may prescribe, on dates to be fixed by him,
and may call for special reports from any particular association whenever in his judgment the same are necessary for use
in the performance of his supervisory duties.

211

TABLE B-17.—Number, total, and principal assets, liabilities, and capital accounts of national banks, by States, June 30, 1964
[Dollar amounts in millions]
ASSETS
Number
of banks

State

Total
assets

United States f

4,702

Alabama . . .
Alaska
Arizona
Arkansas
California . .
Colorado
Connecticut
Delaware
District of Columbia .
Florida
Georgia
Hawaii
Idaho
Illinois
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland

.

. . .

Michigan
Minnesota
Mississippi
Missouri
Nebraska
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming .
Virgin Islands

.

District of Columbia—all*...

Cash
assets §

U.S.
Govern- State and
local
mentobliga- securities,
net A
tions,
net A

$175,107 $29, 513 $31,551 $17, 591

78
5
3
62
71
110
24
5
7
177
54
2
10
407
123
101
169
83
47
22
48
22
90
192
30
88
47
122
3
50
144
33
207
31
40
218
216
11
401
4
26
33
74
534
11
28
124
27
76
106
35
1

2,117
235
1,464
960
24, 931
2,054
1 598
22
1,243
4,495
2,300
367
602
16,514
3,914
1,355
1 724
1,321
2,452
424
1,758
4,901
7,013
3,849
551
2,824
562
1,462
446
407
5,825
667
18,162
1,569
489
8,017
2,957
2,276
12, 329
672
855
548
3 318
12,709
619
256
2,800
3,213
912
2,643
384
26

394
39
182
187
3,773
386
259
3
243
890
509
47
79
2,601
734
302
304
246
484
60
312
932
1,096
711
101
622
81
282
54
66
775
119
2,975
296
57
1,288
616
303
1,756
62
163
67
636
2,649
104
28
413
532
146
484
61
2

422
58
181
166
3,463
374
192
6
303
1,062
316
64
107
3,355
922
283
405
302
562
70
332
698
1,533
743
109
516
119
258
68
66
1,110
163
2,741
180
121
1,622
625
385
2,272
68
168
132
586
2,198
68
52
491
566
279
576
89
5

229
13
88
118
2,304
126
221
1
66
363
168
35
49
1,839
309
114
195
123
224
36
144
337
840
308
65
258
46
107
42
28
792
36
2,125
122
47
777
230
195
1,925
155
56
36
307
1,104
56
18
248
264
66
209
24
1

14

2,189

386

532

97

* Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of the
Currency.
f Includes Virgin Islands.
t Less than $500,000.

212




Other
bonds,
notes,
net A

Loans
and
discounts,
net A

$2,191 $88, 519

Federal Direct
funds
lease
sold
financing

Fixed
assets

$761

$47

$2, 683

11
0
10
3
39
11
7
0
14
15
6
0
0
65
37
0
10
5
18
1
30
57
20
15
0
32
0
0
1
1
25
18
38
26
0
44
13
0
95
4
7
0
14
47
2
1
5
9
1
7
0
0

0

124
3
152
38
14
97
42
10
162
4
12
10
35
152
5
2
41
36
10
46
3
0

994
109
935
451
14,218
1, 086
871
11
585
1, 925
1, 223
204
348
7, 836
1, 771
612
757
602
1, 097
243
879
2, 723
3, 348
1, 894
257
1, 325
289
767
257
234
2, 878
314
9,315
863
235
4, 035
1,365
1, 307
5,819
365
426
287
1, 674
6,154
372
150
1, 537
1,708
392
1,253
195
18

33
7
33
15
431
48
34
1
20
120
45
12
11
120
51
18
20
17
30
9
27
57
78
64
13
34
11
19
18
8
78
11
240
29
11
103
50
50
159
8
18
10
44
282
10
4
48
57
14
44
10

10

1,106

16

22
7
14
16
260
6
4

(t)
85
16
1
4
413
63
19
25
19
16
3
18
16
28
81
4
18
11
20

(t)

o

(t)

o

33

(1)

(i) 0
0

it)
0
0

(t)
1

(t)
0
0

(t)
1

(t)

o

11]
0
0
1
1
0

(t)

o
1

(t)
1
0
0
0
0

U)
0

(1) o
0
0

U)
(t)
0
0

U)
29

§ Cash balances with other banks and cash items in process of
collection.
A Net of valuation reserves.
NOTE : Data may not add to totals because of rounding.

TABLE B-17.—Number^ total, and principal assets, liabilities, and capital accounts of national banks, by States,
June 30, 1964— Continued
[Dollar amounts in millions]
LIABILITIES

Total
liabilities

United Statesf .
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia....
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts.
Michigan
Minnesota.
Mississippi
Missouri
Montana
Nebraska.....
Nevada
New Hampshire.
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia..
Wisconsin
Wyoming
Virgin Islands
District of Columbia—all*..

$160,810
1,938
222
1,351
882
23,211
1,886
1,466
20
1,148
4,120
2,096
336
558
15,168
3,601
1,245
1, 565
1,200
2,238 i
383
1,617 I
4,424
6, 564 '
3,542
506
2,582
523
1, 331
411
366
5, 404
618
16, 583
1,425
454
7, 349
2,665
2, 100
11, 164
621
784
508
3,066
11,607
567
234
2,554
2,965
822
2, 444
351
24 |
2,029

Total
deposits

Demand
deposits,
total

$155,980

Demand
deposits,

Time
deposits,
tPC%

$89, 681

$66, 299

$66, 030

1, 901
220
1,312
871
22, 417
1,852
1,406
20
1,119
4,012
1,994
331 j
549 i
14, 802
3,486
1,221
1,538
1,184
2,202
369
1,574
4,242
6U18
3,434
493
2,536
505
1,303
399
351
5,250
610
15,589
1,354
442
7, 166
2, 629
2,054
10,881
605
752 I
498 I
3,001 I
11,347 ]
556
228
2,488
2,899
807
2,396
344
22

1,220
128
699
587
10,187
1,060
951
10
111
2,593
1,453
185
313
8,428
2,247
817
1,067
826
1,567
215
1,005
3, 164
3,179
2,025
325
1,783
280
938
232
248
2,708
398
8,830
915
233
4,046
1,816
1,031
5,497
248
614
273
1,749
7,390
267
85
1,359
1,701
483
1,335
186
9

681
92
613
284
12, 230
792
455
10
343
1,420
541
146
236
6,374
1,239
405
471
359
635
155
569
1,077
3,239
1,410
168
752
225
364
168
103
2,541
213
6,759
439
209
3,120
812
1,023
5,384
357
138
225
1,252
3,957
289
144
1,129
1,199
324
1,061
158
14

909
90
534
424
8,210
816
778
10
673
1,915
1,008
122
229
5,981
1,535
549
695
658
1,061
178
746
2,321
2,284
1,294
216
1,230
215
665
169
192
2,176
278
6,348
681
188
2,957
1,248
826
4,268
187
486
203
1,094
5,300
205
72
1,054
1,263
360
988
132
7

649
59
586
276
10, 841
715
407
10
330
,268
1,
485
120
235
5,989
1,207
395
435
340
567
153
532
1,020
2,901
1,350
161
720
214
356
156
95

1, 979

1,336

643

1,176

Federal
funds
purchased

$60, 999

624

*Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of
the Currency.
f Includes Virgin Islands.




Time and
savings
deposits,
total

2,462
187
6,194
366
198
2,973
775
930
5,028
345
125
201
1,143
3,369
269
142
1,062
1,190
322
999
139
10

$787

(t)

(O
J

0
0
2
59
7
3
0
5
20
47
0
0
116
26
16
12
0
5
3
7
18
4
44
6
15
3
12
0
3
12
0
146
28
2
18
6
0
25
0
1
4
101
2

(f)

JLess than $500,000.
§IPG deposits are those of individuals, partnerships, and
corporations.
NOTE : Data may not add to totals because of rounding.

213

TABLE B-17.—Number, total, and principal assets, liabilities, and capital accounts of national banks, by States,
June 30, 1964— Continued
[Dollar amounts in millions]
CAPITAL

ACCOUNTS

State
Total
capital
accounts

Debentures

Preferred
stock

Common
stock

$28

$4,162

$6, 950

$2, 491

54
5
27
24
458
57
39
1
28
145
45
9

76
4
55
34
803
74
69
1
49
170
90
14

36
3
14
19
328
36
23

$14, 297

$304

179
12
113
78
1,719
168
132
2
95
375
204
31

0

(t)

14
0
122
0

oo

oooooo

.

ooo o o o o o o

United Statesf
Alabama
.
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa

Mississippi
Missouri

0

0
0
0
0

668
292
175

..

.

....

2
18
0

1,165
51
72
40
252

1,103

(t)
it)

52
22

. .......

District of Columbia—all*




36
0
0

20

643
161

it)

Reserves

15
49
27
6

51

26

0
0

195
80
59

358
113
66

111
76
51

70
390

133
482
26
9

43
166
9
5

it)
U) 0

(i)

0
0
0
1

0
0

0
0

161

0

0

15

277
14
17
14
15
7
73
76
22
50
6

it)
43

676
26
41
16

132
111
44
108
18
1
88

12
1
3
2
10
1
1
11
22
2
2
42
8
2
2
3
1
1
5
7
9
5

34
3
9
67
4
273
20
8

»o

it)

it)

7

20
0
0

(

$362

174
62

38
17
8
127
18
427
37
12

246
248
90
199
32
2

•Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of the
Currency.

214

17
0
0

31

49
30
51
15
36
114
127
89
12
74

oooo

Washington
West Virginia
Wisconsin
Virgin Islands

0
0
0
1
0
50
15
0

14

483
82

profits

72
62
127
15
75
280
225
145
31
111
16
56
14
22
217
18
705
71
15

oooo

..

0

131
34
41
421
49
1,578
144
35

New York
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont

CO O O O

.

4
0

110

M^aryland
Miassachusetts
Michigan .

Nebraska
Nevada
New Hampshire

0
0
0
0
2
0
COOOO

.

159
121
214
41
141
476
449
308
46
242

0
0
0
0
1
0
3
0
0
0

40

Kentucky
Louisiana

0

43

1,346
313

...

Undivided
Surplus

36
26
32
10
22
75
82
69
3
50

7

8

183
11
12
9

it)

3

2
9
9
102
1
1
3
4

it)

(t)

39
59
19
35
8
24

f Includes Virgin Islands.
% Less than $500,000.
NOTE: Data may not add to totals because of rounding.

13
0
1
6

29
2
1
2
1
5
7
1
0
6

TABLE B-18.—Number; total, and principal assets, liabilities, and capital accounts of national banks, by States, Dec. 31, 1964
[Dollar amounts in millions]
ASSETS

State

Number
of banks
Total
assets

United Statesf.
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
•
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New 'Mexico
New York...
North Carolina
North Dakota
Ohio
Oklahoma. ,
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota..
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands

4,773
80
5
4
63
90
115
27
5
8
187
55
2
9
410
124
101
169
82
47
22
49
93
96
193
31
91
48
125
3
50
146
33
203
31
41
221
222
11
387
4
25
33
75
539
12
28
123
28
79
109
38
1

District of Columbia—all*.

Cash
assets^

$190,113 $34, 066 $33,537 $18, 592
2,263
256
1,605
1,060
26,120
2,154
1,728
24
1,305
4,934
2,429
376
661
17, 909
4,290
1,470
1,848
1,505
2,699
444
1,846
5, 260
7,615
4,113
583
4,088
592
1,640
464
432
6,229
686
19, 570
1,764
521
8,697
3,194
2,530
13,626
738
944
583
3,645
13,992
661
266
3,063
3,371
980
2,891
421
28

412
42
230
226
4,068
407
305
3
252
1,132
548
58
97
2,916
820
327
328
335
588
70
332
999
1,183
842
108
981
86
358
67
72
830
117
3,408
382
64
1,432
734
425
2,057
72
191
81
770
3,265
125
32
486
600
164
560
78
3

473
61
166
176
3,675
400
222
6
324
1,068
338
54
129
3,536
973
317
439
315
568
77
369
866
1,592
760
112
664
130
295
78
70
1,174
152
2,746
253
124
1,790
630
413
2,384
87
184
147
658
2,341
57
51
545
573
293
576
101
5

246
21
102
128
2,227
140
230

2,310

423

547

99

•Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of
the Currency.
f Includes Virgin Islands.
JLess than $500,000.




U.S.
Govern- State and
local
ment
obliga- securities,
tions,
netA
net A

(t)

66
377
151
35
53
1,876
333
120
199
136
249
38
152
317
874
356
66
384
52
136
43
24
839
37
2,257
146
56
881
243
198
2,081
166
58
41
332
1,154
68
17
264
279
75
242
25
1

Other
bonds,
notes,
netA

Loans
Federal
Direct
and
funds
lease
sold
discounts,
financing
netA

$2, 237 $95, 577
24
9
39
19
214
8
4
1
3
83
17
1
8
372
67
23
30
23
12
3
24
14
31
85
4
30
10
28

(t)
121
4
161
34
12
91
45
57
148
4
19
11
32
171
6
3
52
26
10
39
4
0

1,047
113
989
489
15, 005
1,121
920
12
626
2,097
1,309
210
358
8,671
1,981
653
818
670
1,206
242
923
2,847
3,739
1,975
276
1,909
298
793
253
248
3,091
326
10,107
896
248
4,276
1,465
1, 334
6,609
391
462
287
1,773
6,551
391
155
1,616
1,773
409
1,404
197
20
1,183

$821
13
2
20
1
11
17

U)

o

3
15
2
0

$81

18
49
1
1
0
0

(t)

(t)

59
35
5
7
0
22
3
12
35
40
0

(I)
U)

(t)
0
0

(t)
4
2
0

(t)
47
0

(t)

0
0
4
1

(t)

0
0
2

(t)
(t)
(t)
(t)

U)
)
(t)
)

(f)
(t)

6
0
0
0
0
0
0
0
0

0

0
§Cash, balances with other banks, and cash items in process
of collection.
A Net of valuation reserves.
NOTE: Data may not add to totals because of rounding.

215

TABLE B-18.—Number, total, and principal assets, liabilities, and capital accounts of national banks, by States, Dec. 31

1964— Continued
[Dollar amounts in millions]
LIABILITIES
State
Total
liabilities

Total
deposits

Demand
deposits,
total

Time and
savings
deposits,
total

Demand
deposits,
IPC§

Time
deposits,

Federal
funds
purchased

United Statesf

$175, 065

$169,617

$98, 660

$70, 957

$74, 200

$64, 763

$827

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Vriginia
Wisconsin
Wyoming
Virgin Islands

2,077
244
1,476
977
24, 325
1,978
1,590
21
1,206
4,532
2,203
343
617
16, 514
3,967
1,357
1,683
1,381
2,480
401
1,694
4,769
7,117
3,796
536
3,739
551
1,503
428
390
5,778
636
17, 950
1,618
484
7,984
2,894
2,352
12, 370
685
870
541
3,381
12, 867
607
243
2,811
3,116
887
2,682
386
26

2,038
241
1,437
966
23, 459
1,941
1,514
21
1,180
4,427
2,140
337
607
16,118
3,829
1,346
1,667
1,365
2,437
387
1,652
4,483
6,950
3,720
528
3,650
538
1,469
418
369
5,606
630
16, 856
1,568
475
7,784
2,852
2,290
11,958
646
837
531
3,293
12, 539
596
237
2,738
3,034
871
2,632
380
24

1,314
130
763
662
10, 728
1,127
1,019
11
800
2,924
1,556
185
359
9,161
2,461
930
1,162
976
1,736
229
1,065
3,417
3,434
2,219
361
2,597
299
1,074
242
267
2,971
405
9,457
1,058
254
4,384
1,992
1,124
6,133
255
699
293
2,028
8,417
312
91
1,540
1,769
526
1,517
218
9

724
112
674
304
12, 732
814
495
10
380
1,503
584
152
248
6,958
1,368
417
506
389
701
158
588
1,066
3,516
1,501
167
1,053
239
395
177
102
2,635
225
7,399
509
221
3,400
860
1,166
5,825
391
138
238
1,265
4,122
284
145
1,198
1,265
346
1,115
162
15

992
103
587
480
8, 776
895
860
10
710
2.. 065
1,100
' 125
267
6. 734
l!787
'644
766
773
1,189
189
834
23 511
2,674
1,503
248
1,714
235
740
176
206
2,443
301
6,993
818
213
3,382
1,446
888
4,999
208
560
235
1,308
5,900
221
77
1,207
1,390
398
1,163
152
7

694
69
649
292
11,180
739
442
10
367
1,321
527
120
247
6,539
1,330
408
468
363
611
156
542
971
3,124
1,432
161
981
226
387
166
98
2,555
195
6,664
401
212
3,236
817
996
5,355
360
123
215
1,150
3,518
263
144
1,120
1,257
344
1,061
143
11

0
0
0
0
55
7
2
0
0
25
0
0
0
104
35
0
0
0
9
0
2
23
0
10

2,143

2,090

1,391

District of Columbia—all*

•Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of
the Currency.
flncludes Virgin Islands.

216




699

1,252

tt)
(t)

32
0
1
1
13
0
187
0
0
19
9
0
118
20
0
0
17
128
2
0
4
6
0
0
0
0

680

jLess than $500,000.
§IPC deposits are those of individuals, partnerships, and
corporations.
NOTE : Data may not add to totals because of rounding.

TABLE B-18.—Number, total, and principal assets, liabilities, and capital accounts of national banks, by States, Dec. 31,

1964— Continued
[Dollar amounts in millions]
CAPITAL

ACCOUNTS

State
Total
capital
accounts
United States f

Debentures

Preferred
stock

Surplus

Undivided
profits

Reserve

$15,048

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New H a m p s h i r e . . . . . . . . .
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma.
Oregon,
Pennsylvania............
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont. .
Virginia. . . . . . . . . . . . . . . .
Washington
West Virginia.
Wisconsin..............
Wyoming
Virgin Islands

$475

$28

$4, 286

$7, 207

$2, 657

$393

185
13
130
83

0

o
o
o

57
5
28
26
475
59
41
1
29
150
46
9
14
487
83
31
49
30
52
16
37
116
132
89
12
98
15
40
17
8
132
18
432
37
12
202
83
59
293
14
18
15
73
395
15
7
77
77
22
51
6

77
4
56
36
812
76
76
1
50
178
91
14
23
656
170
54
74
63
129
15
77
288
234
149
33
152
16
57
15
22
224
18
714
74
15
367
118
66
727
30
42
17
141
494
30
9
134
112
47
111
18
1

39
3

13
1

16

3
2
10

44

91

1,795
' 176

138
2
99
402
226
33
45
1, 395

323
113
165
124
219
42
152
491
499
317
47
350
42
137
35
42
452
49

tt)
26
1
142
3
0
0
0
13
37
0
0
9
0
0
0
0

()
1

0
0
25
0
0
0
0
16
0
60
15
0
22
18
0
17
0
0

146
36
713
300
178
1,255

1,125

53
23
253
255
93
209
35
2

tt)
U) 36




(t)

tt)

0
0
0
0
0
0
1
0
3
0
0
0
3
0
0
0
0
0
0
0
0
20
0
0
0
0

U)
U)

0

()
i

0
0
0
1
1
0

^Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of
the Currency.

15

(t)

31

1,620

52
74
42
264

0
0
0
0
0
0

0
2
0

District of Columbia—all*

79-563—65

Common
stock

(I)

19

357
37

2

20

(t)

17

1

U)

3

11

50
29
8

23

2

5

2

200
62
26
38

43
8

2
3
3

27
34
11
31
78

1
1
6
8

11
5

88

73
1
68
10
37
4
10
69
1
288
19
8
118
77
53
204
9
13
9
43
167
6
5
39

tt)7
() 4
t
() 2
t
11
11
107
1
1
4
4

()
t

15
0
1

tt)7
32
2
1
3

65

2

18
38
9
1

5
8
1
0

26

6

•{•Includes Virgin Islands.
|Less than $500,000.
NOTE : Data may not add to totals because of rounding.

217

TABLE B-19.—Selected loans and discounts of national banks, by States, Dec. 31, 1964
[Dollar amounts in millions]
Loans and discounts
State

Loans to
Loans
secured financial
by real
instituestate
tions

United States f

$24, 065

$7, 098

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Vriginia
Wisconsin
Wyoming
Virgin Islands

171
48
266
108
5,160
245
280
5
217
438
218
90
131
1,388
601
169
118
172
175
76
272
411
1,340
508
54
384
82
89
90
59
1,283
68
2,164
129
83
1,345
244
363
1,956
200
65
75
249
653
150
73
454
456
147
469
63
15

68
0
59
18
1,185
91
22
0
77
121
93
2
12
1,018
141
33
60
47
96
9
73
282
266
188
8
192
5
31
7
10
119
10
910
41
3
242
94
99
336
17
25
10
172
423
31
1
67
158
13
108
2
0

363

164

District of Columbia—all*.

Loans to
purchase
or carry
securities

Loans to
farmers

$2, 878 S3, 683
23

( )10
t
6
189
23
18
0
8
63
16
4
7
530
75
10
8
11
57
3
22
36
80
68
6
81
1
21

40

(t)
162
53
503
149
3
1

(t)
41
20
8
54
223
49
147
190
45
23
9
16
5
35
110
14
83
62
273
7
4
12
32
76
15
60
64
128
77
99

() 2
t
132
5
569
15
2
129
26
8
141

( )25
t
1
56
286
16
1
21
15
5
44
2
0

tt)

18

*Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of the
Currency.
f Includes Virgin Islands.

218




10
94
50
377
21
8
45
112
6
33
38
0

Personal
loans to
Commercial individand indusuals A
trial loans

$34, 164 $22, 715
363
38
270
159
4,977
327
271
2
196
750
504
47
74
3,943
507
152
258
189
541
74
273
1,408
898
677
94
624
73
221
80
85
704
119
4,409
383
54
1,085
602
506
2,393
100
149
58
686
3,126
102
28
444
619
89
377
55
3

360
32
226
146
2,921
291
300
4
118
688
450
49
84
1,457
579
141
190
200
302
72
258
691
1,067
398
89
515
79
154
70
85
861
95
1,908
312
51
1,320
334
281
1,529
59
175
56
569
1,565
69
44
581
380
153
314
40
2

312

305

Other
loans

Loans
and
discounts
gross

$2, 975 $97, 577

$2, 000

1,076
118
998
496
15,271
1,139
939
12
(i)
637
21
2,133
31
1,327
26
211
11
366
3
8,948
390
2,016
65
667
15
829
6
681
17
1,223
30
246
4
936
22
2,921
89
3,808
122
2,000
50
283
17
1,935
56
304
2
807
18
255
1
252
7
3,170
60
336
6
353 10, 387
913
19
255
3
4,360
175
1,487
59
1,346
12
6,752
297
397
21
471
22
298
3
1,811
30
6,680
250
395
6
157
2
1,638
26
1,809
68
418
5
1,441
98
200
1
20

29
5
9
7
266
18
19

51
1
5
5
336
13
46

U)

11
36
17
2
7
277
35
14
11
11
17
4
13
74
69
26
6
27
6
14
1
4
79
10
280
17
7
85
22
12
143
6
9
11
38
129
4
2
23
35
9
37
3

(10

34

1,197

13

{ Less than $500,000.
A Excludes business and farm loans.
NOTE : Data may not add to totals because of rounding.

TABLE B-20.—Selected U.S. Government obligations held by national banks, by States, Dec. 31, 1964
[Dollar amount in millions]
US
State
Treasury
bills

1

United States f
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode: Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont. . . ,
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Island*
District of Columbia—all*

....

Treasury
notes

U.S.
nonmarketable
bonds

maturing
within
7 year

Other
U.S. bonds
maturing
7-4.9
years

Other
U.S. bonds
maturing
5.0-9.9
years

U.S. bonds
maturing
after
70 years

Securities
guaranteed
by US.
Government

$6,708

$10, 043

$130

$991

$7, 747

$7,318

$512

$89

104
18
46
38
879
121
65
1
67
172
90
3
36
685
163
63
98
69
53
23
62
323
230
103
12
272
25
60
12
18
177
20
596
65
12
471
114
60
358
25
27
29
102
387
6
9
126
28
44
112
27

180
7
31
44
994
110
97
1
61
324
102
22
62
901
345
94
124
99
256
29
153
273
429
181
33
151
23
86
10
19
265
40
976
78
25
586
192
54
798
2
38
40
253
699
35
11
183
216
72
212
25

2
2

17
2
20
4
57
19
1

52
19
24
45

2
1
0
3
43
3

1
0
4
1
13

1
10
57
8
15
12
0

115
12
41
40
612
98
28
2
120
189
90
25
28
900
259
96
113
93
158
10
83
98
480
204
35
135
38
79
15
20
351
49
437
54
39
314
178
107
514
45
59
37
190
571
5
15
139
173
87
140
24
2

12

200

(?)
..

Government Obligations A

(1)

(?)

6
2
1
0

(X)15
4
2
3
1
1
1
2
5
7
3
1
2

(X) 1
(?)
(X) 8
1
6
1
\
6
3
1
11

(X)

(t)

3
1
2
8
1
4
2
2
2
1

(?)
94

143

*.lncludes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of
the Currency.
f Includes Virgin Islands.




1
1
1
1

7

(J)

6
59
16

(?)
(?)

113
44
8
20
6
4
1
13
8
98
13
4
12
3
11
15
1
24
7
46
2
2
43
15
26
44
0
22
4
20
57

(t)

1,078

47
29
2
62
308
37
4
2
846
153
53
75
45
82
12
53
154
278
246
26
86
39
55
26
11
305
29
638
52
45
345
120
163
585
14
33
36
87
548
11
11
81
90
72
91
12
1
89

(X)

U)

0
1
9
1
0

71
5
1
6
3
12

(X) 2
4
64
8
1
4
1
3
0
1
41
2
37
1
1
23
8
2
72
1

(?)

1
4
46
0
4
3
7
7
4
2
0
1

(?)
(?)

0

(?)
0
0
1
5

(X)
(?)
(X)
(X)

(?)

1

o
l
7
1

(1)
(1)
(?)
(?)

(?)
(?)
(?)

2
0
2
3
11
0
3

0

(?)
(?)

1
24

(?)
(?)

(?)
(?)

(?)

1
1
0

(?)

JLess than $500,000.
A Each category is net of valuation reserves.
NOTE : Data may not add to totals because of rounding.

219

TABLE B-21.—Bank trust assets and income by States
Trust Department Income in 7964

Accounts wher? national banks* exercise investment
responsibility
State

Number of
banks having
accounts

United States
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Idaho
Illinois.
Indiana
Iowa
Kansas ..
Kentucky
Louisiana
Ivfaine
.
Miaryland
Michigan
M[innesota
Mississippi
Missouri
M^ontana.

...

1,564

...

...

Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming

28
4
2
24
16
25
13
1
6
62
22
1
131
93
37
35
52
18
15
10
60
28
19
16
26
10
13
2
20
85
12
84
18
6
50
32
2
156
2
11
9
26
125
2
12
57
10
31
33
12

Employee
benefit
accounts
($ millions)

Other trust
accounts
($ millions)




National f
banks
($ thousands)

All insured
commercial
banks
($ thousands)

National
banks as a
percent of
total

$20, 782

$54, 443

$75, 225

$310, 797

$640, 071

48.6

113
2
16
9
1,458
100
205
0
173
153
119
6
3,670
220
33

681
4
361
215
4,819
936
1,402

794
6
378
224
6,277
1,036

2,906
72
2, 052
656
42, 015
5, 2.00
6,917
0
5, 927
8,573
4, 618
239
36, 209
6,090
1,640
1, 260
1, 455
1 247
1, 078
2, 324
22,109
9,656
8,354
245
8,054
156
2, 246

3,076
72
2,512
759
58,510
5,485
15, 647
6,897
5,927
10, 515
7,815
284
56, 642
8,088
2,791
1,375
5,388
1,524
1,910
3,712
33, 226
17, 566
8,478
793
10, 549
452
2,283

94.5
100.0
81.7
86.4
71.8
94.8
44.2
0
100.0
81.5
59.1
84.2
63.9
75.3
58.8
91.6
27.0
81.8
56.4
62.6
66.5
55.0
98.5
30.9
76.3
34.5
98.4
80.9
86.4
55.8
96.0
14.5
35.7
99.7
45.2
99.7
95.6
55.3
31.8
88.6
89.3
81.3
92.7
42.3
39.5
71.3
90.9
54.9
43.5
94.5

28

23
55
15

tt)

969
1,754
770
22
5,143
1,518
256
272

237
169
180

1,607

(t)

1,142
1,907
889
28
8,813
1,739
288
299

261
224
195

55
1,802
2,114
474
2
520
2

375
3,867
1,561
1,235
53
1,661
38

431
5,670
3,675
1,709
57
2,181
40

48
4

373
79

421
83

5
112
5
3,365
102
5
867
119
62
3,357
68
62
8
75
719
47
3
109
118

124
989
99
4,870
497
36
2,809
397
521
7,411
261
291
43
1,554
2,695
88
37
1,143
908

130
1,101
104
8,234
599
41
3, 677
516
582
10, 768
328
353
50
1,629
3,414
135
41
1,252
1,026

11
143
1

240
447
33

251
590
34

* National bank figures on trust assets include national and
nonnational banks in the District of Columbia and the assets of
some affiliates of national banks that submitted data to the
Office of the Comptroller of the Currency.

220

Total trust
accounts
($ millions)

794

891

445
8,416
670
29,195
2,462
363
12, 084
2,311
3,499
32, 405
1,605
1,257
359
3,496
14, 692
683
210
5,000
5,368
1,034
2,902

515
15,090
698
201,025
6,890
364
26, 748
2,378
3,668
58, 591
5,052
1,418
402
4,299
15,851
1,613
532
7,009
5,908
1,885
6,678

189

200

f National bank trust income covers the same banks as the
asset figures, including full-year trust income for banks converting to national status in 1964.
% Less than $500,000.

TABLE B-22.—Common trust funds by States, 1963 and 1964*
Number of banks
with common
trust funds
1963

Number of commoi
trust funds

1963

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida.
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
......
Michigan
Minnesota
Mississippi.
Missouri
Montana
.|
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina., . . . .
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah....
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Total United States.

Number of account
participations

1964

7963-64
increase
in assets
(percent)

7963

0
11
3
27
22
15
4
6
24
12
7
1
26
9
2
6
8
1
12
14
36
26
20
2
21
4
5
2
7
25
3
73
15
3
43
10
10
105
8
7
9
12
30
8
9
37
12
7
23
0
693

Total assets of funds
($ millions)

794
0
949
571
14, 030
4,385
3,804
2,166
2,061
2,258
3,220
975
27
4,584
1,571
83
264
1,856
122
1,800
5,000
9,650
3,286
3,002
482
7,405
336
723
285
217
6,219
696
21,001
3,214
227
5,812
588
3,197
49, 746
1,296
1,267
348
1,756
3,717
1,500
578
5,600
3,532
794
4,340
0

788

191,334

1,373
0
1,889
675
17, 693
5,315
4,070
2,200
2,227
2,715
4,277
1,063
71
6,832
1,676
170
375
1, 906
171
2,200
5,843
10, 877
4, 901
3,902
527
8,815
426
858
297
361
7, 052
795
24, 351
6,663
255
7,300
838
3,956
53,114
1,361
1,551
529
2,069
5,114
1,700
625
6,751
4,268
865
5,080
0
228,142

14.0
0
34.5
5.9
276.5
106.8
108.7
79.0
54.9
37.8
73.3
16.4
.3
172.3
24.8
1.1
3.5
21.1
2.0
38.5
96.9
349.1
43.1
51.2
5.6
178.8
3.3
16.3
3.3
8.8
73.5
9.9
898.7
99.1
1.9
162.6
15.2
60.8
985.0
29.8
14.6
2.5
30.3
75.7
14.5
6.2
91.4
60.6
9.5
70.2
0

15.8
0
50.8
7.8
375.3
134.7
126.1
85.0
68.5
52.5
92.1
19.6
.7
274.9
29.3
1.6
6.2
28.8
2.7
51.3
132.3
435.3
96.0
69.3
6.8
225.2
4.9
20.1
5.1
12.9
87.8
13.5
1,152.4
129.7
2.2
207.5
21.2
74.2
1,154. 2
35.1
17.7
4.4
63.5
107.9
18.6
7.2
140.7
84.9
11.7
88.2
0

12.9
0
47.2
32.2
35.7
26.1
16.0
7.6
24.8
38.9
25.6
19.5
133.3
59.5
18.1
45.5
77.1
36.5
35.0
33.2
36.5
24.7
122.7
35.4
21.4
26.0
48.5
23.3
54.5
46.6
19.5
36.4
28.2
30.9
15.8
27.6
39.5
22.0
17.2
17.8
21.2
76.0
109.6
42.5
28.3
16.1
53.9
40.1
23.2
25.6
0

4, 539. 8

5, 854. 2

29.0

*These figures were derived from a survey ot banks and trust companies operating common trust funds. Data are for the
last valuation date in 1964 and 1963.




221

T A B L E B-23.—Current operating revenue, expenses, and dividends of national banks, by major categories and States, year
ended Dec. 31, 1964
[Dollar amounts in millions]
Current operating revenue
Interest and dividends on securities
State

United States f

Interest
and
U.S.
discount
Other
Governon loans
securities
ment
obligations

Other
service
Service
charges,
charges commissions, Trust
on
departfees and
deposit
ment
collection
accounts
and
exchange
charges

Other
Total
current
current
operating operating
revenue revenue

$1,190

$602

$5, 232

$94

$441

$133

$290

$165

$8,148

80
5

16
2
6
6
134
15
8

8
1

63
8

3

1

(t) 2

1

101
14

60
28
867
66
55
1
34
120
78

7
1
6
2
94
7
6

2
1

3
4
78
4
6

1
1
2

4
63
90
115
27
5
8
187
55
2

9
410
124

3

222




14
5
1
2
68
11
4
7
5
7
1
5
10
26
12
2
8
2
4
1

13

22
424

(t)
3
2

(t)
5
1

107

37
45
37
64
15
51
156
195
109
16
74
17
45
16

-ri

101
169
82
47
22
49
93
96
193
31
91
48
125

39
12
2
4
126
35
11
16
11
20
3
13
27
56
28
4
20
9
10
3

1
1

(t)
(+")

(t)

1

com o

4,773

CO CM

Alabama .. .
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida .
..
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
M^aine
..
Maryland
Massachusetts
Michigan .
. . . .
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
See footnotes at end of table.

Number
of banks §

Service
charges
and
other
fees on
bank
loans

1
3
21
9
3
5
3
6
1
4
14
13
9
2
4
2
4
1

2
1
19
2
1
3
3

(t)
10
3
1
1

33
703

(1)

(t)36

29
1
1
(%)

18

(t)

6

2
1
1
1
1
2
12
10
8

2
10
5
6
1
1
1
1

U)

13

(t)

0

(t)

(t)

3
1

82
43
1,289
102
84
1
55
205
116

1
42
5
7
0
2
9
5

3

(t)

1
1
1
2
9
5
2

U)
(l)

2
1

2
1

(t)

176

59
76
59
103
22
79
242
311
177
26
115
29
67
24

TABLE B-23.—Current operating revenue, expenses, and dividends of national banks, by major categories and States, year
ended Dec. 31, 79(54—Continued
[Dollar amounts in millions]
Current operating revenue
Interest and dividends on securities
State

New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia..
Wisconsin
Wyoming
Virgin Islands
District of Columbia—all*

Number
of banks §

50
146
33
203
31
41
221
222
11
387
4
25
33
75
539
12
28
123
28
79
109
38
1
15

U.S.
GovernOther
ment
securities
obligations
3
41
6
100
8
5
63
23
13
85
3
6
5
22
82
3
2
19
21
11
22
3

(t)
20

Interest
and
discount
on loans

1
27
1
72
5
2
28
8
6
63
5
2
2
10
39
2
1
9
9
2
8
1

(t)
3

•Includes national and nonnational banks in the District of
Columbia, all of which are supervised by the Comptroller of the
Currency.
f Includes Virgin Islands.
JLess than $500,000.




Service
charges
and
other
fees on
bank
loans

15
169
21
531
53
15
229
86
81
339
21
27
19
100
362
23
9
95
107
25
70
13
1

(t)
(t) 9

64

1

Other
service
Service
charges,
charges commissions, 7rerf
fees and
departon
deposit
collection
ment
and
accounts
exchange
charges
2
17
2
34

2

(t)
1
1
4

(t)
(t)
(t) 1
6
1
{%)

2
2

(t) 1
(t)
tt)

(t)

5

2
18
8
10
18
2
3
2
6
22
2
1
8

U)

14
1
5
1

3
1
10
3
1
4
2
1
6
1
1
1
2
8
1

2
3
1
2
1

U)

(t)
6

1

Other
current
operating
revenue

(i)

(t)

(t)12

tt) 5

8
1
29
2
2
3
28
2
1

4
1
38
1

2
2
9

(t) 3

(t) 1
(t) 2

(t) 5

(i)
(J)

(t) 0

(1)
U)

15
1

8

5
1
3

6

2
3
1
3

1

Total
current

22
272
33
823
79
25
362
132
118
554
33
42
29
147
542
32
13
141
165
41
112
19
2
103

§Number of banks as of end of year, but figures of income,
expenses, etc., include banks which were in operation a part of
the year but were inactive at the close of the year.
NOTE : Data may not add to totals because of rounding.

223

T A B L E B—23.—Current operating revenue, epxenses, and dividends of national banks, by major categories and States, year ended Dec. 31,

1964—Continued

[Dollar amounts in millions]
Current operating expenses
Officer and
employee
benefits
(pensions,
Employees other hospitalization, social
than officers
security,
insurance,
Amount Number A
etc.)

Salaries and wages

State
Officers

Amount

Number §

United Statesf

$665

62, 775

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine

9
2
7
5
97
10
8

15
3
14
6
207
15

20
11
2
3
47
17
7
10
6
9

873
114
692
494
9,579
971
727
21
358
1,922
1,004
134
301
3, 870
1,527
695
995
681
111

2

231

4




(t)

$1,211 300, 976

16

35
20
3
5
92
27
8
9
8
16

4,371
534
3, 517
1,751
46, 226
3.845
3,938
62
1, 838
9,515
5,490
627
1,420
20, 991
7,113
2,269
2,545
2,494
4 079
1,056

$266

<» I

1
41
3
4

6
5
1
1
24
6
2
2
2
3
1

Fees paid to
directors and
members of
executive,
discount,
and other
committees

$33

U)
(I)
1
1

(t)
(t)
U)

(t)

Interest
on time
and
savings
deposits

Furniture
Other
Net
and equipTotal
Interest
current
and dis- occupancy ment (depre- current
expense ciation, rents, oprating operating
count on
borrowed of bank servicing, un- expenses
expenses
capitalized
money
premises
costs, etc.)

$2, 263
24
3
23
10
429
28

(t)
(t)
(t)
(i)

$351

$206

$890

$5, 905

$2, 243

3
1
4
2
57
5

$20

2
1
3
1
34
3

12
2
9
6
106
12

70
11
63
31
974
79
63
1
35
155
84
13
22
495
126
43
51
40
72

31
3
19
13
314

15

(t)
1

11
47
18
5
8
225
38
13
16
11
21
5

0
(t)
(J)

l

o

(t)

(t) 2
(t)
(t)
U)

(

S

Net
current
operating
earning^)

10

(t)
9
7
1
1
23
8
3
3
3
5
1

8
4
1
1
13
5
2
2
2
3
1

28
18
2
3
66
24
8
8
7
15
3

16

24.

22

(i)
51
20

32
5
11

208

50
16
26
19
31
6

District of Columbia—all*

6
20
17
16
2
10
3
9
2
2
21
3
50
8
3
27
15
12
40
2
5
3
11
51
2
1
13
15
4
10
2

()
t
8

639
1,702
1,390
1,535

254
1, 064

313
834
252
269
1, 914

331
4, 110
797
281
2,319
15 573
1,301
4,074

184
532
352
1, 111
4, 895

228
148
1,360
1,470

410
995
222
10
605

13
43
47
25
4
18
4
9
4
3
45
5
120
13
3
52
17
18
74
4
9
4
20
64
4
2
20
29
5
15
3

()
t
15

3,587 1
10, 443
12, 080
6,540
1,007
5,741
1,028
2,524

920
965
11,498
1,487
25, 765
3,780

882
12, 980
4, 581
4,366
19,431
1,188
2, 562
1,010
5,401
16,895
1,080

531
5,717
6,693
1,481
4,376

685
71

3
9
11
6
1
4
1
2
1
1
9
1
32
3
1
9
4
4
18
2
2
1
4
14
1
>
4
5
1
3
1

(t)

3,522

*Includes national and nonnational banks in the District of Columbia, all of
which are supervised by the Comptoller of the Currency,
f Includes Virgin Islands.
JLess than $500,000.




(t)
(t)
(t)

1
1
1
1
1

($)

(t)
(t)

(t)

U)
U)

U)
(t)

2
2
2
1
4

3
1
1

18
34
111
48
5
25
7
12
5
4
78
7
256
15
7
97
29
36
171
14
3
8
44
137
10
5
37
41
10
32
5

( )1
t

21

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(t)
1

1

(t)

it]
ill

0

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t
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t
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t
()
t
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t
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:
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:
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:
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I
Mil

Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
................
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands

4
12
13
8
1
5
1
3
2
1
14
1
40
4
1
13
5
5
22
1
2
1
6
23
1
1
5
8
1
5
1

(t)
5

(t)

2
7
7
5
1
3
1
2
1
1
7
1
16
3
1
8
3
3
13
1
2
1
4
13
1
4
5
1
3
1

U)

10
28
33
20
4
13
4
9
2
3
30
5
83
10
3
46
15
11
62
3
6
3
16
71
3
1
17
16
5
12
2

()
t
2

12

57
155
240
129
18
78
21
47
17
16
207
25
602
56
18
254
89
89
405
27
28
21
106
381
22
11
101
120
27
81
14
1
67

§Number at end of period. Excludes building officers.
ANumber of employees at end of period. Excludes building employees.
OTotal current operating revenue less total current operating expenses.
NOTE : Data may not add to totals because of rounding.

22
87
71
48
8
37
8
20
7
6
65
9
222
23
7
43
29
29
148
6
14
9
41
160
10
3
40
45
14
30
5

(t)

36

TABLE B—23.—Current operating revenue, expenses, and dividends of national banks, by major categories and states, year ended Dec. 31,

1964—Continued

[Dollar amounts in millions]
Recoveries', transfers from valuation reserves, and profits §
On loans

On securities
State
Profits on
securities
sold or
redeemed

United States f
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine




$43

Recoveries

$2

Transfers
from
valuation

$39

Recoveries

Transfers
from
valuation
reserves

$19

All
other

$58

Losses, chargeoffs, and transfers to valuation reserves A

On securities
Total
On loans
recoveries
transfers
from
Charge- Transfers
Transfers
valuation Losses on off s on
to
to
Losses
reserves, securities securities valuation
and
valuation
not sold
and
sold
reserves chargeoffs reserves
profits
$169

$50

$4

$41

$13

li

11
1*

3
3
24
4
2
1
1
3

(t)
(t)
U)

(t)'

a/
1

is
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$366
5
1
4
2
52
3
3
0
1
9
3
(t)
1
57
6
2
2
2
3
1

All
other

Total
losses,
chargeoffs, and
transfers
to valuation

$82

$557

17
1
2

7
1
4
3
87
5
6
)

($)
«)
1

2
12
5
1
2
77
13
3
4
3
6
1

Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands

it)
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*Includes national and nonnational banks in the District of Columbia, all of
which are supervised by the Comptroller of the Currency.
f Includes Virgin Islands.
{Less than $500,000.




1

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27
21
6
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2
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4
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1
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§Not Including recoveries credited to valuation reserves.
ANot including losses charged to valuation reserves.
NOTE : Data may not add to totals because of rounding.

1

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(t)

TABLE B—23.—Current operating revenue, expenses, and dividends of national banks, by major categories and states, year ended Dec. 31, 1964—Continued
[Dollar amounts in millions]

State

United States \
Alabama
Alaska
Arizona
Arkansas .
California
Colorado
Connecticut.
Delaware
Dist. of Col
Florida. . .
Georgia
Hawaii.
.
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine. .
Maryland

. . .

Net income
before
related
taxes

$1,855

$580

$51

$1,213A

25
2
16
11
237
20
16

8
1
6
3
69
7
5

1

16
1
9
8
142
12
11

(t)

. . . .




Federal State

Net income
before
dividends
On
common
stock

18
41
30
5
9
155
41
15
23
17
28
5
27

(t)
8
14
10
1
3
47
16
5
7
5
11
2
8

tt)
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22
o
1
1

U)
0
0
o
0

o
0
1
0
0

o
0

U)

10
27
19
3
5
108
25
10
15
11
17
3
19

$591

Net income
Capital
before
On
Total
Net in- accounts § dividends
to capital
precash
come
accounts
ferred dividends
after
stock declared dividends
(percent)

$1

$593

0
0
0

7

2
92
6
6

o
0
0
0
0
0

a)
ii
7
1
2
50
10
4
5
4
6
1
6

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0
0

o
0
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0

tt)
0

o

0

$620 $14, 298
9
1
4
5
50
6

5
2
92
6
6
a)

s
11
7
1
2
50
10
4
5
4
7
1
6

a )

Memoranda items

Ratios

Cash dividends declared

Taxes on net
income

5
16
12
2
3
58
15
6
10
7
11
2
13

179
13
110
79
1,679
169
132
2
96
377
202
32
44
1, 356
315
110
160
121
211
41
143

harged to
Total cur- Recoveries cred- Losses c
valuat on rerent operat- ited to valuation
serves (not
ing expenses reserves (not
indueled in
to total cur- included in rej
rent operat- coveries, p. 226) losses, b. 226)
ing revenue
(percent)
On
On
On
On
securities loans securities loam

8. 48

72. 47

$3

8.94
7.69
8. 18
10 13
8.52
7. 10
8.33
4.65
10.42
7. 16
9.41
9.37
11. 36
7.96
7 94
9.09
9.37
9.09
8.06
7 32
13.29

69. 31
78. 57
76.83
72. 09
75. 56
77.45
75.00
87.45
63.64
75. 61
72.41
72.22
66. 67
70.41
71. 59
72.88
67. 10
67.80
69.90
72. 73
72.15

0
0
0

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o

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0
0
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$106
1

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$32

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19
0

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4
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3
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3
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1
10
4

(t)
tt)

22
5
1
2
1
2
1
1

Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
,
New Mexico
New York
,
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Virgin Islands

.. .

. ..

District of Columbiaall*

81
55
46
7
35
7
18
6
5
49
6
177
21
5
95
37
23
121
5
12
8
35
130
10
2
34
41
13
27
4

()
t
33

28
15
15
2
13
2
7
2
2
12
2
42
7
2
34
13
7
26

Q)

5
3
12
46
4
1
13
16
5
8
2

6
0
3
0
1
0
0
0
0
0
0
8

()
t
()
t
0
1
2
0

()
t
()
t
U)
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()
t
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0

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0
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15

0

48
39
28
5
21
5
11
4
3
37
4
125
13
4
61
23
14
94
4
7
5
23
84
6
2
21
25
8
18
2

()
t
18

23
18
13
2
8
2
5
2
1
17
2
63
6
2
26
12
8
49
3
3
2
9
45
3
1
10
11
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8
1
0

8

0

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0
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(f)
0
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0
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0
0
0
0

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0

0
0
0
0
0
0

* Includes national and nonnational banks in the District of Columbia, all of which
are supervised by the Comptroller of the Currency.
f Includes Virgin Islands.
t Less than $500,000.
§This includes the aggregate book value of capital stock, undivided profits, reserves, and preferred stock retirement fund. These are averages of data from the




26
12
8
49
3
3
2
9
45
3
1
10
11
3
8
1
0

25
21
15
3
13
2
6
1
2
19
2
61
7
2
35
11
6
44
2
4
3
14
39
3
1
11
14
5
9
1

U)

475
461
308
45
276
41
133
33
41
427
48
, 540
137
35
675
288
174
, 185
51
72
40
255
,090
52
23
246
248
91
201
33
2

10. 11
8.68
9.09
11. 11
7.61
12.20
8.27
12. 12
7.32
8. 67
8.33
8. 12
9.49
11.43
9.04
7. 64
8.05
7. 85
7.84
9.72
12. 50
9.02
7.71
11.54
8.70
8.54
10.08
8.79
8. 96
6.06
14.04

64.05
77. 17
72. 88
69. 23
67. 83
72. 41
70. 15
70. 83
72.73
76. 10
75.76
73. 15
70.89
72.00
70. 17
67.42
75.42
73. 10
81. 82
66.67
72. 41
72. 11
70. 30
68. 75
84. 62
71.63
72.73
65.85
72. 32
73. 68
72.01

161

23
18
13
2
8
2
5
2
1
17
2
64
6
2

11. 18

65. 05

(I)

()
t0
0
0

1
1

3
5
2
1
1

U)

2
1
6

0
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0

0
0

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(t)
(i)
0
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()
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(t) tt) U)
18
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4
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0

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()
t0
0

()
t0
0

()
t0

()
t
()
t
U)
1
7

()
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1

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t

0

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0
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0

Reports of Condition of the previous December and the current June and December of the respective year.
A This figure is after deduction of $10 million, interest paid on capital notes and
debentures.
NOTE: Data may not add to totals because of rounding.

T A B L E B—24.—Current operating revenue, expenses, and dividends of national banks in the United States and possessions operating throughout calendar 1964, bv
size of deposits, December 1964
[Dollar amounts in millions]
Banks operating throughout entire year with deposits in December 1964, of—
Item

Number of banks
Total deposits
Capital stock (par value)
Capital accounts
Current operating revenue:
Interest and dividends on—
U.S. Government obligations
Other securities
Interest and discount on loans
Service charges and other fees on banks' loans
Service charges on deposit accounts
Other service charges, commissions, fees, and collection and exchange charges
Trust department
Other current operating revenue

Less than
$2.0

$25.1 to
$50.1

$50.1 to
$100.0

$100.1 to
$500.0

Over
$500.1

Total

1,253

1,169

1,012

336

$4, 310
139
489

$8, 355
207
785

$15, 853
391
1,386

$11,671
295
966

$12, 482
322
1,044

$37, 598
943
3,165

$76, 272
1,864
6,769

47
13
136
1
13

86
31
258
2
27

149
62
498
7
55

106
44
357
5
38

112
45
368
5
35

254
119
1,144
21
96

420
283
2,423
50
172

1,181
598
5,201
93
438

7
1
4

13
8
10

9
15
9

9
18
9

29
76
30

60
170
100

165

217

417

801

1,770

3,678

8,097

35
26
4,645
7,973

53
52
6,262
15, 386

84
111
8,505
31,295

140
285
11,781
71,797

231
550
19,456
121,039

658
1,202
61,601
295, 765

128

264

(t)

()
t

(t)
(t)

6
3
1,111
1,100

11

56
87
5,237
24, 057

180

53
88
4,604
23, 118

176

50

22

23

18

18

60

(t) 18

217
1
36

4
159
1
28

3
165
1
27

5
437
5
76

10
49

( )10
t

(t)

Total current operating expenses




$10.1 to
$25.0

$562
25
82

21
98

15
71

17
72

52
209

83
348

6
111

3
1, 103
11
151

4,569
$167, 104
4,185
14, 688

132

33
2,250
19
347
204
879

IB
U)

165

310

597

439

445

1,269

2,609

5,856

52

Net current operating earnings
Recoveries, transfers from valuation reserves, and profits:
On securities:
Profits on securities sold or redeemed
Recoveries
Transfers from valuation reserves

$5.1 to
$10.0

393

Total current operating revenue
Current operating expenses:
Salaries and wages: *
Officers
Employees other than officers
Number of officers *
Number of employees other than officers 2
Officer and employee benefits—pensions, hospitalization, social security, insurance, etc
Fees paid to directors and members of executive, discount, and other committees
Interest on time and sayings deposits
Interest and discount on borrowed money
Net occupancy expense of bank premises
Furniture and equipment—depreciation, rents, servicing, uncapitalized costs, etc
Other current operating expenses

$2.1 to
$5.0

107

204

145

156

501

1,069

2,240

19

43
2
39

IS

U)

()
t

()
tI
32

On loans:
Recoveries
Transfers from valuation reserves
All other

1

1

1
4

1
2

2
3

4
15

4

7

14

9

9

31

2
1

3
1
2

3

4
6

4
14
4

3
32

1
24

1

1

(t)

8

11
29

19
56

92

167

28
32

49
4
41

79

(t)182

13
362

14

46

81

reserves:
...

(t)
(t)

(8

,,,.
....

1
1

U)

Total losses, chargeoffs, and transfers to valuation
reserves

3

6

(1)

9

24

(t)

6

4

(t)

(t)

U)

2

12

25

47

34

34

108

289

551

6

43

90

171

120

131

424

872

1, 856

1

Net income before related taxes
Taxes on net income:
Federal
State

1

1
2

1

Total recoveries, transfers from valuation reserves,
and profits
Losses, chargeoffs, and transfers to valuation
On securities:
T osses on securities sold . . .
Chargeoffs on securities not sold
Transfers to valuation reserves
On loans:
Losses and chargeoffs
Transfers to valuation reserves
All other

2

2

(t)

tt)
(t)

11
1

24
2

50
3

39
2

43
2

145
8

264
35

578
51

(t)

Total taxes on net income

1

12

26

53

41

45

153

299

629

Net income before dividends 3

4

32

64

119

79

86

268

565

1,216

On common stock
On preferred stock

2
0

12

23

128

310
1

590
1

2

12

23

45

33

36

128

311

591

3

19

40

74

46

50

140

254

625

2
1

3
2
1

10
7
3
2

74
52
21
11
1 40
. 74

1 34

15.79
8. 35
4. 59

15. 25
8. 28
4. 02

Total cash dividends declared
Net income after dividends
Average per bank:
Gross current operating revenue
Current operating expenses
Net current operating earnings
Net income before dividends

(8

Per $100 of deposits:

U)

Net income before dividends
Per SI00 of capital accounts:
Net current operating earnings
Net income before dividends
Cash dividends
1

(t)




tt)

45

(t)

1
1

il]
il]

18
(8

U)
(t)

33

($)

(t)

36

(t)

(t)

(t)

76

68

1 25
. 69

1 33

74

1 29
" 75

1 24

75

8. 32
5 18
2.05

10.62
6 49
2.51

13.60
8 09
2.97

14.72
8 56
3.23

14.99
8. 17
3.42

14. 91
8.21
3.47

15. 83
8.47
4.06

1 21

Excludes building employees.
Number at end of year.
3
After deduction of interest paid on capital notes and debentures.
JLess than $500,000.
2

(t)

1 21

1 28

.71

2
1

(J)
(i)
.73

NOTE : The deposits, capital stock, and capital accounts shown in this table are as
of December. Capital accounts represents the aggregate book value of capital
stock, surplus, undivided profits, reserves, and retirement fund for preferred stock.

TABLE B-25.—Current operating revenue, expenses, and dividends of national banks, years ended Dec. 31, 1963 and 1964
[Dollar amounts in thousands]
1963
Number of banks *

4,615

Capital stock, par value *
Capital accounts 2

4,773

$3, 886, 042
$13,102, 085

...

$4,163, 070
$14, 297, 834

Amount
Current operating revenue:
Interest and dividents on:
U S Government obligations
Other securities
Interest and discount on loans
Service charges and other fees on banks' loans
Service charges on deposit accounts
Other service charges, commissions, fees, and collection and exchange

1

.

...

.

.

Officer and employee benefits—pensions, hospitalization, social
security insurance etc
. . .
. . .
Fees paid to directors and members of executive, discount, and other

$1,171,285
504, 854
4, 621, 556
83, 090
408, 787

16.04
6.91
63.29
1.14
5.60

$1,189,736
601, 677
5, 232, 386
93, 734
441, 409

14.60
7.38
64.22
1.15
5.42

1. 55
3.57
1.90

133 259
290, 331
165,166

1 64
3.56
2.03

100. 00

8,147, 698

100. 00

11.63
21.63

664, 841
1, 210, 766

11.26
20.50

58, 238
287, 498

62, 775
300, 976

Furniture and equipment—depreciation, rents, servicing, uncapitalized costs etc
.
. . .
Other current operating expenses
Total current operating expenses

242, 598

4.64

31,014
1, 917, 349
19, 576
313,563

. 59
36.67
.37
6.00

173, 699
791, 979

3.32
15.15

5, 228, 765

Interest on time and savings deposits
Interest and discount on borrowed money

100. 00

' 2, 073, 706

Net current operating earnings
Recoveries, transfers from valuation reserves, and profits:
On securities:
Profits on securities sold or redeemed
.

Total recoveries, transfers from valuation reserves, and profits....




Percent
distribution

607, 954
1,131,033

Number of officers *
Number of employees other than officers

232

Amount

7, 302, 471

Total current operating revenue
Current operating expenses:
Salaries and wages:
Officers
Employees other than officers

See footnotes at end of table.

Percent
distribution

113,394
260, 970
138, 535

Other current operating revenue

Transfers from valuation reserves
On loans:
Recoveries
. ..
Transfers from valuation reserves

1964

266, 022

4.51

447
724
526
823

.57
38.32
.33
5.94

206, 210
890, 354

3.49
15.08

5,904,713

100. 00

33
2,262,
19,
350,

2, 242, 985

88, 053
2,340
44, 764

29.98
.77
14.74

43, 318
1 564
39,214

25.69
.93
23.25

8,062
105, 038
55, 537

2.65
34.58
18.28

7,640
19,288
57, 599

4.53
11.44
34.16

303, 794

100. 00

168, 623

100. 00

T A B L E B--25.—Current operating revenue, expenses, and dividends of national banks, years ended Dec. 31, 1963 and

1964—Continued
[Dollar amounts in thousands]
1964

1963
Percent
distribution

Losses, chargeoffs, and transfers to valuation reserves:
On securities:
Losses on securities sold
Chargeoffs on securities not sold
Transfers to valuation reserves
On loans:
Losses and chargeoffs
Transfers to valuation reserves
All other

Amount

Percent
distribution

$27, 750
6,306
39, 259

$49, 738
4,442
41, 340

8.93
.80
7.42

12, 527
329, 596
68,119

Total losses, chargeoffs, and transfers to valuation reserves

5.74
1.30
8.12
2.59
68.16
14.09

13,465
365, 585
82, 370

2.42
65. 64
14.79
100 00

483, 557

State

1, 854, 668

637, 099
50, 927

Taxes on net income:
Federal

556, 940

1, 893, 943

Net income before related taxes

579, 742
51,430
631,172

688, 026

Total taxes on net income.

1,213,2843

1,205,917

Net income before dividends

548,186

Total cash dividends declared
Net income after dividends
Occupancy expense of bank premises:
Salaries and wages:
Officers
Employees other than officers.
Number of officers *
Number of employees other than officers *
Building officer and employee benefits
Recurring depreciation on bank premises and leasehold improvements
Maintenance, repairs, and uncapitalized alteration costs of bank
premises and leasehold improvements
Insurance, utilities (heat, light, and water), etc
Rents paid on bank premises
Taxes on bank premises and leasehold improvements

Total

620, 474

1,186
50, 048

.29
12.22

1,485
52, 831

.33
11.71

166
16, 978

152
16,814

,
,

5,998

1.47

6,268

1.39

75, 058

18.33

81,760

18.12

51,333
68, 435
94, 717
62, 682

12.54
16.71
23.13
15.31

56,140
74, 593
110,149
67, 963

12.44
16.53
24.42
15.06

409, 457

Gross occupancy expense.

Net occupancy expense.

592, 810

657, 731

On preferred stock

Less:
Rental income from bank premises
Other credits

591,491
1,319

547, 060
1,126

Gash dividends declared::
On common stock

100. 00

451,189

100. 00

92, 204
3,690

22.52
.90

96, 468
3,898

21.38
.86

95, 894

23.42

100, 366

313, 563

76.58

350,823

77.76

See footnotes at end of table.




233

TABLE B-25.—Current operating revenue, expenses, and dividends of national banks, years ended Dec. 31, 1963 and

1964— Continued
[Dollar amounts in thousands]
7963
Amount

Memoranda items:
Recoveries credited to valuation reserves (not included in recoveries
above):
On securities
On loans
Losses charged to valuation reserves (not included in losses above):
On securities
On loans
Stock dividends (increases in capital stock)
Ratios to current operating revenue:
Salaries wages and fees *
Interest on time and savings d e p o s i t s . . . . .
All other current expenses
Total current expenses

.

$5, 306
60, 402

$2, 553
105, 995

11,867
177, 661
126, 085

Percent
distribution

32, 320
225, 854
153,497

27.77
21.27
72.47

28.40

27.53

14. 11
4.18

14.24
4.15

NOTE: Earnings and dividends figures for 1869 to 1937 were
published for the years ended Aug. 31 or June 30 and appear
in the table beginning on p. 96 of the Comptroller's Annual
Report for 1937. Similar figures for 1938 through 1941 appear
in table 26 on p. 136 of the 1941 report. Calendar year figures
are available, beginning with the year 1917 and are published
in the Comptroller's reports as follows: 1938, p. 100; 1940,
p. 17; 1942, p. 34; 1943, p. 30; 1946, p. 98; 1949, p. 100;
1951, p. 118; 1954, p. 142; 1957, p. 152; and I960, p. 217.
r




Amount

71.60

....

Ratio of cash dividends to capital stock (par value)
Ratio of cash dividends to capital accounts

234

Percent
distribution

24.24
26.25
21.11

Net current earnings

1 Number at end of period. Remaining figures include
earnings, expenses, etc., of banks which were in operation a
part of the year but were inactive at the close of the year.
2
Figures are averages of amounts reported for the June and
December call dates in the year indicated and the December
call date in the previous year.
3
After deduction of $10.2 million, interest paid on capital
notes and debentures.
4
Exclusive of building employees.

1964

Revised from 1963 Annual Report.

T A B L E B—26.—Number of national banks, capital stock and accounts, net profits, dividends, and ratios to capital accounts, years ended Dec. 31, 1944-64
[Dollar amounts in thousands.

For earlier data, see Annual Reports of the Comptroller of the Currency, 1938, p . 115, and 1963, p. 306]

Capital stock (par value)

Tear

Number
of banks
Preferred

1944
1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955.
1956
1957
1958.
1959
1960
1961
1962
1963
1964

l

5,031 110,597
5,023 80, 672
5,013
53, 202
5,011
32, 529
4, 997
25, 128
4,981
20, 979
4,965
16,079
4,946
12, 032
4,916
6, 862
4,864
5,512
4,796
4,797
4,700
4,167
4, 659
3,944
4,627
3,786
4,585
3,332
4, 542
3, 225
4, 530
2.050
4, 513
2, 040
4,503
9, 852
4,615
24, 304
4,773 27, 281

Cash dividends

Common

Total

Total
capital
accounts *

$1, 440, 519
1, 536, 212
1, 646, 631
1, 736. 676
1, 779, 362
1, 863, 373
1, 949, 898
2,046,018
2, 171, 026
2, 258, 234
2, 381, 429
2, 456, 454
2,558, 111
2,713, 145
2,871,785
3, 063, 407
3, 257, 208
3, 464, 126
3, 662, 603
' 3,861,738
4, 135,789

$1, 551, 116
1,616,884
1, 699, 833
1, 697, 205
1, 804, 490
1, 884, 352
1,965,977
2, 058, 050
2, 177, 888
2, 263, 746
2, 386, 226
2, 460, 621
2, 562, 055
2,716,931
2,875,117
3, 066, 632
3, 259, 258
3, 466, 166
' 3, 672, 455
3, 886, 042
4, 163, 070

$4, 114, 972
4,467,718
4, 893, 038
5, 293, 267
5, 545, 993
5,811,044
6, 152, 799
6, 506, 378
6, 875, 134
7, 235, 820
7, 739, 553
7,924,719
8, 220, 620
8, 769, 839
9,412,557
10,003,852
10, 695, 539
11,470, 899
12, 289, 305
13,102,085
14, 297, 834

Net profits
before
dividends

$411,844
490, 133
494, 898
452, 983
423, 757
474, 881
537, 610
506, 695
561,481
573, 287
741,065
643, 149
647, 141
729, 857
889, 120
800, 311
1,046,419
1, 042, 201
1, 068,843
1, 205, 917
1, 213, 284

1
These are averages of data from the Reports of Condition of the previous
December and the current J u n e and December of the respective year.




On
preferred
stock

On
common
stock

$5, 296
4, 131
2, 427
1,372
1, 304
1,100
712
615
400
332
264
203
177
171
169
165
99
119
202
1, 126
1,319

$139,012
151,525
167, 702
182, 147
192, 603
203, 644
228, 792
247, 230
258, 663
274, 884
299, 841
309, 532
329, 777
363, 699
392, 822
422, 703
450, 830
485, 960
517,546
547, 060
591,491

Ratios
Cash dividends on
preferred
stock to
preferred
capital

Cash dividends on
common
stock to
common
capital

Percent
A.19
5. 12
4.56
4.22
5. 19
5.24
4. 43
5.11
5. 83
6.02
5. 50
4.87
4. 49
4.52
5.07
5. 12
4.83
5. 83
2.05
4. 63
4.83

Percent
9. 65
9.86
10. 18
10. 49
10. 82
10.93
11.73
12.08
11.91
12. 17
12. 59
12.60
12.89
13. 41
13. 68
13.80
13. 84
14.03
14. 13
' 14. 17
14. 30

* Revised from 1963 Annual Report.

Net profits before
Total cash
dividends
dividends
to capital
accounts To capital To capital
stock
accounts
Percent
3.51
3.48
3.48
3.47
3. 50
3.52
3.73
3.81
3.77
3.80
3. 88
3.91
4. 01
4. 15
4. 18
4.23
4.22
4. 24
4.21
4. 18
4. 15

Percent
26. 55
30.31
29. 11
25. 60
23. 48
25. 20
27.35
24. 62
25.78
25. 32
31. 06
26. 14
25.26
26.86
30.92
26. 10
32. 11
30.07
29. 10
' 31. 03
29. 14

Percent
10.01
10. 97
10. 11
8.56
7. 64
8. 17
8.74
7.79
8. 17
7. 92
9. 58
8. 12
7.87
8. 32
9. 45
8. 00
9. 78
9. 09
8.70
9. 20
8. 49

TABLE B-27.—Total loans of national banks, losses and recoveries on loans, and ratio of net losses or recoveries to loans, by
calendar years, 1945—64
[Dollar amounts in thousands]
Year

1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964

Total loans end
of year

1

Recoveries

Ratio of net
Net losses or losses or net
recoveries ( + ) recoveries ( + )
to loans

$13, 948, 042
17, 309, 767
21, 480, 457
23,818,513
23, 928, 293
29, 277, 480
32, 423, 777
36,119,673
37, 944,146
39, 827, 678
43, 559, 726
48, 248, 332
50, 502, 277
52, 796, 224
59, 961, 989
63, 693, 668
67, 308, 734
75, 548, 316
83, 388, 446
95, 577, 392

$29, 652
44, 520
73. 542
1
50, 482
1
59, 482
1
45, 970
1
53, 940
1
52, 322
1
68, 533
1
67,198
1
68, 951
1
78 355
1
74, 437
1
88, 378
1
80, 507
181,683
164, 765
157, 040
190,188
239, 319

$37, 392
41,313
43, 629
2
31,133
2
26, 283
2
31, 525
2 31,832
2
32, 996
2
36 332
2
41, 524
2
39, 473
2
37 349
2
39, 009
2
50, 205
2
54} 740
2
51,506
2
52 353
2
59,423
2
68, 464
2
113,635

+ $7,740
3,207
29,913
19, 349
33,199
14, 445
22,108
19, 326
32 201
25, 674
29, 478
41 006
35, 428
38,173
25, 767
130,177
112 412
97, 617
121, 724
125, 684

45, 833,147

....

Average for 1945-64

2

Losses and
chargeoffs

93, 463

46, 006

47, 457

Percent

+ 0.06

.02
.14
.08
.14
.05
.07
.05
08
.06
.07
08
.07
.07
.04
.20
17
.13
.15
.13
.10

NOTE.—For earlier data, see Annual Report of the Comptroller of the Currency, 1947, p. 100.

Excludes transfers to valuation reserves.
Excludes transfers from valuation reserves.

TABLE B-28.—Total securities of national banks, losses and recoveries on securities, and ratio of net losses or recoveries to
securities, by calendar years, 1945-64
[Dollar amounts in thousands]
Total securities
end of year

Tear

1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
I960
1961
1962
1963
1964

.

1
2

Excludes transfers to valuation reserves.
Excludes transfers from valuation reserves.

236




Recoveries

Met losses or Ratio of net
recoveries ( + )
losses to
securities

$55,611,609
46, 642, 816
44, 009, 966
40, 228, 353
44, 207, 750
43, 022, 623
43,043,617
44, 292, 285
44, 210, 233
48, 932, 258
42, 857, 330
40, 503 392
40,981 709
46, 788, 224
42, 652, 855
43,852,194
49, 093, 539
51, 705, 503
52, 601, 949
54, 366, 781

. ...

Average for 1945—64

Losses and
chargeoffs

....

$74, 627
74, 620
69, 785
1
55, 369
1
23, 595
1
26, 825
1
57, 546
1
76, 524
1
119,124
1
49, 469
1
152, 858
1
238, 997
1
151,152
1
67, 455
1
483, 526
1
154,372
1
51,236
i 47; 949
1
45, 923
1
86, 500

$54,153
33,816
25, 571
2
25, 264
2 7,516
2
11,509
2
6, 712
2
9, 259
2
8, 325
2
9. 286
2
15. 758
2
1 3 027
2
5 806
2
12, 402
2
18, 344
2
21,198
210 604
2
6, 350
2
7, 646
2 4,117

$20, 474
40, 804
44, 214
30,105
16,079
15,316
50, 834
67,265
110,799
40,183
137,100
225 970
145 346
55, 053
465,182
133,174
40, 632
41,599
38,277
82, 383

45, 980, 249

105, 373

15, 333

90, 040

Percent

0.04
.09
.10
.07
.04
04
.12
.15

.25
.08
.32
56
.35

. 12
1.09
.30
.08
.08
.07
.15
.20

NOTE.—For earlier data, see Annual Report of the Comptroller of the Currency, 1947, p. 100.

TABLE B-29.—-Foreign branche s of national banks3 by region and country, Mar. 37, 1965
Region and country

Latin America

Number
•

68

I

Argentina
Bahamas
Brazil
Chile
Colombia
Dominican Republic . .
Ecuador
El Salvador
Guatemala.
Jamaica
Mexico
Nicaragua
Panama . .
. . .
Paraguay
Peru
Uruguay
Venezuela

17
1
15
2
5
1
2
1
2
1
5
1
5
2
2
2
4

Continental Europe:

Number

Region and country

Africa

1

Nigeria

1

Near East

4

Lebanon
Saudi Arabia
Dubai

2

.

Far East

1
1
36

Hong Kong
India

5
5
10
5
1

Japan

Malaysia
Pakistan
Philippines

2

5
2

12

Germany
Greece
Italy
Netherlands

1

1
2
3
1
1
3

Belgium

Thailand
U.S. overseas area

14

1
1

Canal Zone
Guam
Puerto Rico
Truk Islands

11
1

Total

England

144

9

TABLE B-30.—Foreign branches of national banks, 1955-64

End of year

1955
1960.
1961
1962.
1963
1964

,

National bank
branches as a
Number of
branches operated percentage of
total foreign
by national
branches of
banks
U.S. banks
85
93
102
111
124
138

76.6
75.0
75.6
76.6
77.5
76.7

T A B L E B—31.—Assets and liabilities of foreign branches of national banks, Dec. 31, 1964: consolidated statement 1
[Dollar amounts in thousands]
138
LIABILITIES
Number of branches
Demand deposits of individuals, partnerships, and
corporations
.. .
$730, 761
Time and savings deposits of individuals, partnerLoans and discounts
$1, 924, 827
ships, and corporations
1,178, 987
Securities...
178, 958
Deposits of U.S. Government
190, 932
Currency and coin..
31, 331
State and municipal deposits
12, 988
Balances with other banks and cash items in procDeposits of banks
753, 791
ess of collection
480, 730
Other deposits (certified and officers' checks, etc.).
21, 468
Due from head office and branches
320, 858
Total deposits
2, 888, 927
Fixed assets
?8, 352
Customers' liability on acceptances
304, 362
Due to head office and branches
8, 591
Other assets
50, 461
Rediscounts and other liabilities for borrowed
money
61? 015
3, 319, 879 Acceptances executed by or for account of reportTotal assets
ing branches and outstanding
305, 481
1
Other liabilities
55,865
Excludes figures for banking facilities at military establishments.
Total liabilities
3,319,879




237

TABLE B—32.—Assets and liabilities of all national banks, date of last report of condition, December 1936-64
[Dollar amounts in thousands]

Number
of banks

1936...
1937...
1938...
1939...
1940...
1941...
1942...
1943...
1944...
1945...
1946...
1947...
1948...
1949...
1950...
1951...
1952...
1953...
1954...
1955...
1956...
1957...
1958...
1959...
1960...
1961...
1962...
1963...
1964...

Loans and
discounts
including
overdrafts

5,331 88, 271, 120
813,547
5,266
489, 120
5,230
5,193 9,043, 632
5, 150 10, 027, 773
5,123 H, 751,792
5,087 10, 200, 798
5,046 10, 133,532
5, 031 11, 497, 802
5,023 13, 948, 042
5,013 17, 309, 767
5,011 21, 480, 457
4,997 23, 818,513
4,981 23, 928, 293
4,965 29, 277, 480
4,946 32, 423, 777
4, 916 36, 119,673
4,864 37, 944, 146
4,796 39, 827, 678
4,700 43, 559, 726
4, 659 48, 248, 332
4,627 50, 502, 277
4,585 52, 796, 224
4, 542 59, 961,989
4,530 63, 693, 668
4,513 67, 308, 734
4, 505 75, 548, 316
4. 615 83. 388. 446
4,773 *95', 577; 392

1

U.S. Goveminent
obligations,
direct and
guaranteed

Other
bonds,
stocks,
and
securities

$8, 685,554
094, 490
8, 072,882
690, 122
8, 705,959
753, 234
9, 073,935
737, 641
9, 752,605
915,435
12, 073, 052
814,456
23, 825, 351
657, 437
34, 178, 555
325, 698
43, 478, 789
543, 540
51, 467, 706
143, 903
41, 843, 532
799, 284
38, 825, 435
184,531
248, 090
34, 980, 263
937, 227
38, 270, 523
331, 063
35, 691, 560
887, 274
35, 156, 343
355, 843
35, 936, 442
621, 470
35, 588, 763
425, 259
39, 506, 999
166, 524
33, 690, 806
823, 307
31, 680, 085
643, 633
31, 338, 076
963, 464
35, 824, 760
891, 885
31,760, 970
140, 471
32,711, 723
005, 861
36, 087, 678
042, 255
35, 663, 248
218,063
33. 383. 886
33, 537, 250 |20, 829, 531

Cash

$518, 503
422, 490
555, 304
615, 698
718,799
786, 501
733, 499
807, 969
904, 500
1, 008, 644
1, 094, 721
1, 168, 042
1,040,763
1,059,663
1, 147, 069
1,418,564
1,446, 134
1, 292, 254
1, 279, 171
1, 388, 250
1, 706, 507
1, 734, 533
1, 675, 827
1, 521, 334
1,721,492
1, 923, 655
2, 277, 621
2, 178, 563
2, 481, 563!

Balances
with other
banks 1

462, 578
128,003
151, 105
887,915
401, 268
215,429
516,771
272, 695
732, 749
170, 145
972, 446
907, 548
983, 506
985, 295
666, 366
593, 594
953, 269
253, 264
442, 726
375, 190
375, 990
130, 601
188,993
942,911
953,014
154,790
405, 959
455, 937
584, 291

Includes reserves balances and cash items in process of collection.
Includes reserve accounts.
NOTE: Reciprocal interbank demand balances with banks in the United States
are reported net beginning with the year 1942.
NOTE: For earlier data, revised for certain years and made comparable to those
2




Other
assets

Total assets

, Capital

Surplus
and
undivided

profits

$1, 032, 327 $31, 064, 662
104, 230
977, 186
666, 177
1,011,455
960, 436
319, 257
918,082
733, 962
897, 004
538, 234
847, 122
780, 978
813, 468
531, 917
792, 479
949, 859
797, 316
535, 756
830,513
850, 263
447, 000
880, 987
1, 063,917
135, 052
239, 179
1, 058, 178
1, 126; 555 97, 240, 093
1, 259, 008 102, 738, 560
1, 321, 382 108, 132, 743
1, 416, 802 110, 116, 699
1, 668, 736116, 150, 569
1,569,791 113, 750, 287
1, 867, 761 117, 701, 982
2, 173, 520 120, 5223 640
2, 347, 698 128, 796, 966
636, 113
2, 557,024 132,
3, 040, 499139, 260. 867
3, 328, 334 150,809, 052
3,719, 607
160, 657, 006
5, 608, 468 170, 233, 363
6, 102, 6781190, 112,

2

Total
deposits

Bills payable and
rediscounts,
etc.

Other
liabilities

$1,598,815 $1 572, 195 $27 608, 397
$3, 495 $281,760
540, 694
10,839 308, 499
666, 367
1 577,831
050, 676
5,608
757, 522
1, 570, 622
28,749
612,992
2,882 298, 265
532,903
872,215
1,
852, 424
3, 127
009, 161
1, 527, 237
342,013
554, 772
3,778
133, 305
1, 515,794
330, 585
648, 616
3,516
234, 673
1, 503, 682
390, 291
156,181
8, 155 408, 139
531, 515
427, 927
1,
128,937
54, 180 491,877
707, 960
1, 566, 905
242, 947
77, 969
996, 898
1, 658, 839
559, 103
049, 839
20, 047 630, 578
393, 178
1, 756, 621
275, 356
45, 135 705, 185
779, 766
641,558
1,
648,016
41, 330 774, 818
842, 129
1, 828,759
344, 318
7, 562 952, 958
018, 001
1, 916, 340
529, 632
76, 644 1 , 304, 828
327, 339
2, 001, 650
431, 561
15,484 ,621, 397
105, 345
564,773
2,
257, 776
834, 369
75, 921 1, 739, 825
2, 224, 852
947, 233
107, 759
14,851 1, 745, 099
2, 301, 757
618, 398 106. 145, 813
,
11,098 1 889,416
2, 485, 844
463, 305 104, 217,989
107, 796 ,488,573
2, 472, 624
834, 024 107, 494, 823
18, 654 ,716,373
2, 638, 108
287,004 109.436, 311
38, 324 1 , 954, 788
2, 806,213
717,522 117 086, 128
43,035 , 999, 002
2, 951, 279
132, 375 119, 637, 677
,
340, 362 : 355, 957
3, 169,742
755,488 124, 910, 851
1
110, 5903;, 141,088
3, 342, 850
298, 062 135, 510,617 224, 615 3;
1,198,514
3, 577, 244
992, 104 142, 824, 891 , 635, 593 . 446, 772
,
3, 757, 646
3.
518,935 150;823,412
,
4, 029, 243
395, 201 1 466, 572
,
4, 789, 943 10, 258, 252 169. 616, 780 299, 308 . 148, 422

in this table, references should be made as follows: Years 1863 to 1913, inclusive,
Comptroller's Annual Report for 1931; figures 1914 to 1919, inclusive, report for
1936, and figures 1920 to 1939, inclusive, report for 1939.
*This does not include Federal funds sold.
f This does not include corporate stocks.

APPENDIX C

Addresses and Selected Congressional Testimony of
JAMES J. SAXON
Comptroller of the Currency




INDEX
Addresses and Selected Congressional Testimony of James J. Saxon,
Comptroller of the Currency
Date and Topic

October 26, 1964, "Toward a Stronger Dual Banking System": remarks before the National Bank Division, American
Bankers Association, Miami Beach, Fla

Page

241

March 9,1965, before the Senate Permanent Subcommittee on Investigations, on chartering policies, bank failures, operating
powers, and disclosure

243

April 26, 1965, before the House Banking and Currency Committee, on the underwriting of revenue bonds

246

April 30,1965, before the Subcommittee on Bank Supervision of the House Committee on Banking and Currency* on the bank
regulatory structure
June 30, 1965, before the House Banking and Currency Committee, on the operating powers of National Banks

247
248

240




REMARKS OF JAMES J. SAXON, COMPTROLLER OF THE CURRENCY, BEFORE THE NATIONAL BANK DIVISION,
AMERICAN BANKERS ASSOCIATION, MIAMI BEACH, FLA., OCTOBER 26, 1964

Toward a Stronger Dual Banking System
For the past 3 years we have been reexamining and
recasting the rules and regulations applied to National
Banks in the light of today's needs and opportunities.
Several advisory committees have assisted us in this
effort, and we have had recommendations for action
from National Banks throughout the country.
One central theme has appeared persistently
throughout our review of existing policies. From all
segments of the banking industry, in every section of
the country, we had protests that bank initiative was
being hampered in many ways without any supportable
public purpose to justify the restrictions. The objections took a variety of forms and touched virtually
every major phase of bank regulation.
In the reforms we have undertaken and advocated,
we have had one paramount objective. This objective
has been to leave bank operations to bankers unless
restrictions are required in order to safeguard the solvency and liquidity of the banking system. The goal is
to release the full energy and initiative of the banking
industry in the service of the community and the Nation.
This was a novel approach to bank regulation, in
contrast with the climate which prevailed for many
years in the banking industry and among bank regulators. In principle, there had always been extensive reliance on private initiative in banking. In practice, however, the regulatory authorities had for many
years treated the banking industry much as a group
of unruly children who needed daily guidance and
periodic scolding or finger-shaking. These disciplinary
measures were regarded as necessary, not only by the
parent chartering agencies, but also by anxious relatives in other governmental departments. Some of
this attitude survives today, but there has been a notable and growing acceptance of the need and the capacity of the banking industry to operate more fully
under our traditional, standards of individual responsibility and competitive enterprise.
As the reins of public control have been loosened,
a remarkable transformation has taken place throughout the banking industry. Armed with broader discretionary powers, the banks have met the challenge




of opportunity with a sharpened sense of responsibility
and a surge of new initiative. This transformation has
not come easily, or quickly. The new powers had to be
tested and appraised, and a change of outlook had to
be developed. The underlying strength and force of
the banking industry is evident in the growing confidence of the banks, and in their expanding initiative,
and they have experimented in the broader fields
opened to them. This has been a highly commendable
performance on all counts, and one in which the banking industry takes justifiable pride.
The momentum which has been achieved must be
sustained, and it should be further strengthened
throughout the dual banking system. The attitudes
and powers of bankers, the way in which they view
their responsibilities and their opportunities, their
vision and their initiative—all exercise a critical influence on the form, the pace, and the direction of our
economic progress.
The commercial banks today occupy a strategic position at the center of the business and industrial structure. To them is entrusted for productive use a major
portion of the Nation's savings; they operate a check
mechanism which represents a principal means of payment in the business life of the country; and, through
their powers of credit creation, they provide one of
the most significant sources of financing for the new
ventures which are so essential to the continuing growth
and development of the economy.
This crucial role of banks in the economy makes
the regulation of banks of critical significance to the
Nation's welfare. We live in a dynamic, pulsating
society which is undergoing rapid change. Our population is expanding greatly, and we are striving to make
the best use of the skills and talents of all our people.
Population shifts have brought both urban and suburban problems, and we continue to struggle with the
difficulties which prevail in our agricultural communities. Our markets are constantly broadening new
methods and instruments of production and distribution are being introduced continually, and new products are coming on the market at a growing rate.
International considerations continue to exert a major
influence on our domestic policies. Our capacity to
cope with these needs, to provide employment for our
people and sustain a rising standard of living, to
241

strengthen our society and our economy, rest decisively
on the financing facilities which are available to carry
on the many new ventures which will be required.
Both great segments of our dual banking system must
share in these tasks and in this responsibility, and the
public authorities who regulate the banks must be attuned to these vital needs.
It is time we understood that there is no conflict of
purpose in strengthening both the State and the National banking sytsems, and no conflict of interest between these two systems. Indeed, the highest level
of performance is required both of State and National banks if the vast diversity of banking needs in individual markets throughout the country are to be
met. There is no monopoly of wisdom, and there
should be no monopoly of initiative, in responding to
these needs. Independent dual banking systems, each
functioning according to its own special standards and
objectives, afford the best assurance that the essential
requirements for banking services will be fully and efficiently served.
It has been most encouraging to see that the reforms which have been undertaken within the National Banking System are being subjected to critical
scrutiny and review by the State authorities and the
State banks. We have taken the initiative in many
respect to recast the structure of public control applied to National Banks, but there has been a steadily
accelerating and highly constructive movement to
undertake reforms at the State level.
This process of strengthening the State banking
systems would be greatly simplified if certain changes
were brought about in the present regulatory structure. State banks are subject to regulation not only
by the State authorities, but also in many areas by
the Federal Reserve Board and the Federal Deposit
Insurance Corporation. This multiplicity of regulation has operated to weaken the stature of the State
banking authorities, and has hampered the full development of the State banks. I can see no valid
reason for continuing this Federal intercession into
the functioning of State banks, and I should like to
suggest a means to overcome these disabilities now imposed on that segment of our banking industry.
At the present time, no State bank which is a member of the Federal Reserve System may open a branch
without the approval of the Federal Reserve Board as
well as the State authorities. Where a merger is
undertaken in which the resulting bank is to be a State
member bank, a similar double approval is required.
In addition to the State laws which they must observe,
State member banks are also subjected to Federal Re242




serve controls of many of their basic deposit, lending
and investment operations.
The Federal Deposit Insurance Corporation exercises comparable controls over branching and mergers
by insured State nonmember banks. Moreover, the
State authorities today will not ordinarily charter a
new bank unless it is approved for insurability by the
Federal Deposit Insurance Corporation. A a result,
the effective power to charter new State banks rests
for all practical purposes with a Federal agency.
Moreover, in order to qualify for continued insurability, a State bank must subject its operations to
examination and supervision by the Federal Deposit
Insurance Corporation.
Together, these factors have had the effect of lodging critical powers over the life of State banks in
Federal hands. Perhaps more significantly for the
strength of the dual banking system, these all-pervasive
Federal controls over State banks have operated to
discourage the effective performance of bank regulation and supervision by the State authorities, and have
tended to weaken the State banking systems.
Federal intercession in the operation of State banking systems has, in my judgment, been founded on
mistaken concepts of the proper roles of the monetary
authority and the insuring authority in the conduct
of bank regulation and bank supervision. There is
no purpose of monetary policy which requires that
the monetary authority should have regulatory power
over commercial banks. It is not the operating policies and practices of banks, but the total supply of
money and credit, which is the proper province of
the monetary authority. Indeed, to allow the monetary authority to intercede directly in bank operations
is to run the risk that banks will be hampered in their
capacity to compete, and will fail to make the best
allocation of the resources entrusted to them.
It is equally inappropriate to impose insurance
standards—particularly commercial insurance principles—in the public supervision and control of bank
operations. The potential for mischief is most serious
where the insuring agency has any power over bank
expansion or the kinds of risks which banks may
assume. There is a natural inclination for an insuring agency to minimize its losses by limiting the risks
it accepts. But if this principle of cutting insurance
losses were allowed to govern eligibility for deposit insurance, bank expansion and bank lending and investment operations which entail elements of risk or uncertainty could be effectively blocked. Enterprise and initiative in the banking industry could be paralyzed and
the performance of the entire economy retarded. This

is surely not the objective we have sought through our
system of deposit insurance.
A proposal

I would propose that Federal regulatory powers
over State banks, as distinct from those powers which
are clearly essential to the conduct of monetary policy,
should be transferred to the States. Such a transfer
of regulartory power would encourage improved performance by the State authorities, and it would end
the discriminatory treatment of State banks which
results from the exercise of Federal authority.
There is no regulartory objective which requires that
State banks should be treated differently from National Banks with respect to deposit insurance. The
chartering and branching decisions of the State authorities, and their exercise of the examinatory and
supervisory functions., should have the same standing
as comparable actions by the Comptroller of the Currency in qualifying banks both for initial and for
continuing deposit insurance.
Similarly, no discernible public purpose is served
by requiring the approval of the Federal Reserve
Board for the branching or merger of State banks.
These decisions properly belong with the chartering
authority which is charged with responsibility for
shaping the banking structure. The complete divorcement of bank regulation from monetary controls would
entail still broader modifications in the regulatory
structure. The Federal Reserve Board now exercises
certain regulatory powers over the operating policies
and practices of National as well as State banks.
Where these powers are not essential to the conduct
of monetary policy, they should be transferred to the
chartering authority, whether it be State or National.
The plan which I have outlined is in sharp contrast with certain other proposals which have been
advanced for reformation of the bank regulatory
structure. One proposal which has attracted wide
attention calls for the retention of all existing Federal
powers over State banks, and provides that these
Federal powers over State banks should be combined
with Federal powers over National Banks and placed
under the jurisdiction of a single new Federal agency.
The consequence of this proposal would be to centralize in a monolithic new agency full control of the
National Banking System and vital powers over all
the State banking systems. If that proposal were
adopted, the erosion of the stature of the State banking authorities would undoubtedly be accelerated, and
the dual banking system as we now know it would be
on its way out.




What we need in banking is not greater centralization of authority, not more rigorous conformity to imposed rules of conduct, but enlarged freedom to respond to the challenge of the future. What we require is greater scope for enterprise and initiative, not
a common mold into which we force the entire banking
system.
Under the inspiration of the new opportunities
which have been unfolded, the banking industry has
taken on new life and new vigor. A vital new image
has been established which holds bright promise for
the future. Once again, we have had a dramatic
demonstration of the latent force of our private enterprise system. Our purpose now should be to make
certain that this creative force in our society finds full
expression throughout the dual banking system.
BEFORE THE SENATE PERMANENT SUBCOMMITTEE ON
INVESTIGATIONS, TUESDAY, MARCH 9, 1965

I should like to confine my opening remarks to a
brief background statement which I hope will set
banking policies in proper perspective.
Three aspects of banking policy have attracted particular attention in recent months. These relate to
the enlarged operating discretion of banks, the increase
in bank population through new charters, and the disclosure of facts about bank operations and bank ownership and control. To appraise these policies fairly, we
shall have to understand the place of the banking industry in the economy, and the purposes of bank
regulation.
The single fact to bear in mind throughout is that
we live in a private enterprise economy. This means
that we place primary reliance on the individual to
choose his own occupation, to spend his income as he
wishes, and to undertake such ventures as he cares to
risk. The presumption is against governmental restriction of this free discretion unless there is a clear public
need which the Government can satisfy better than the
individual.
These precepts have a particular bearing on the
basis, and the bounds, of public regulation of banking.
Under our public policy, we control entry into banking, and we place certain limits on the operating powers of bankers. In administering these restrictions, the
banking agencies have certain discretionary authority.
When we place this fact in the context of a basic public
policy which favors individual initiative, it seems clear
that the banking agencies should exercise their discretionary powers in a way which will avert needless
impediments to the initiative and enterprise of the
individual banker.
243

This is the principle we have followed in the reforms
we have undertaken. Our aim has been to make the
National Banking System a more effective servant of
the people. We have sought this objective by enlarging the operating discretion of bankers, by responding
more sensitively to the demands for additional banking
facilities, and by pursuing a full disclosure policy.
Our test in the case of operating powers has been
whether a restriction of free discretion is required in
order to preserve the solvency and liquidity of the
banking system. Our test in the case of new facilities
has been the public need for additional banking offices.
We have pioneered programs of disclosure to shareholders and requirements for the reporting of changes
in ownership and control.
The reforms which we have introduced in the National Banking System are winning increasing support
throughout the country as goals for the State banking
systems. These efforts to modernize the other great
segment of our dual banking system portend lively
competition and effective participation in the growth
and development of the Nation's economy.
Chartering policy
To understand chartering policy, we have to realize
that bank entry is restricted by public authority. A
bank charter is a license to do business, and without
it no bank can be formed or operate. This is in clear
contrast with the freedom of entry all of our citizens
enjoy in the nonregulated industries.
In many respects, the problem of entry is identical
in all industries. Individuals have capital to invest
and they seek the most profitable outlets for that capital. In our dynamic economy, the factors which affect
market profitability are undergoing constant change.
Incomes are rising, savings are increasing, our population is growing and shifting, demands are changing,
new technologies are being developed, new products
and services are being introduced, and new industries
are springing up. New opportunities thus abound, but
these changes bring uncertainty and risk. This is the
nature of a free enterprise system.
When a banking agency is presented with an application for a new charter, it faces much the same problems that confront any businessman who seeks to judge
the prospects of a new market. The banking authorities can estimate the need and the profitability of
proposed new banks, but they cannot resolve all doubts.
There is, therefore, an unavoidable element of chance.
There is also an inescapable necessity of choice.
The responsibility of the banking agencies is not to bar
bank entry, but to regulate it in accordance with the
244




public need. The demands for banking services do
change, and private entrepreneurs do seek to respond
to these changes. When individuals apply for bank
charters, the banking authorities must rule on the applications. Failure to allow new facilities to be provided
to meet changing consumer demands for banking services can defeat private initiative in meeting these demands. It is the responsibility of the banking authorities to see that this does not occur where there is a
genuine need which can be profitably served.
Bank

failures

The failure of several banks within the recent
months has been linked, by some, with chartering policy. What is the public interest in the prevention of
bank failures?
The failure of an enterprise in any industry means
that productive resources have been misdirected. In
the nonregulated industries, there is no public effort
to prevent failure. The assumption is that the public
benefits of free initiative and enterprise will outweigh
any wastage of resources which may result.
In banking, there is greater public concern about
failure. Confidence in the banking system is essential
if banks are to perform effectively. But, there is an
equal public necessity to assure that banking facilities
expand as consumer demands change.
The procedures for chartering new banks take account of both these considerations. In reviewing an
application for a new National Bank charter, we carefully examine the market which the applicant proposes
to serve, in order to determine the probable need for
the additional facility. Charters are issued only where
we conclude that such a need exists, and that the applicant is capable of satisfying that need profitably. There
has been no instance of National Bank failure, certainly not in recent years, which can be traced to a
miscalculation of the market opportunity.
Before we approve a National Bank charter, we must
also be satisfied of the character and competence of
the proposed management to conduct the affairs of
the bank. The single failure among the National Banks
which were approved for chartering during the past
3 years may be traced to management deficiencies.
The information at our disposal at the time of approval
was favorable in that case as in the others. It is always difficult to anticiapte or to uncover deliberate
misconduct, and the pattern of misconduct is not
usually evident at the early stages. The record will
show that prompt and decisive action was taken whereever misconduct was discovered.

Operating powers
There is a variety of public controls restricting bank
competition for deposits which are the "raw materials"
of banking, and for the loans and investments which
are the "products" of banking operations. Some criticism has been directed against the enlarged competitive power of banks in both these respects under our
program of banking reform. It is well to understand
the implications of these views.
The philosophy we have followed has been to repose greater trust and confidence in the discretion
and judgment of the individual banker. This has been
a calculated effort to instill a greater sense of responsibility, and a more enlivened spirit of enterprise, in
the banking industry. In resting these new powers
with bankers, we have understood that banks would
become more venturesome. Indeed, this was our aim.
Banking is not an industry which functions within
itself. It occupies a central role in financing our growing economy. There is no way to take the risk out of
banking without taking the risk out of the industry and
commerce which it serves. There is the choice of withdrawing the banking system from participation in our
national growth and development. But this is an
empty choice, and one we cannot tolerate. The economy which banking serves is the vital product of
generations of free enterprise. A banking system attuned to its needs must be no less enterprising.
The most disturbing suggestion I have heard is that
the banking agencieis should be responsible to prevent
bankers from exercising poor judgment. Under the
present system of bank examination and supervision,
banking operations are subjected to careful and expert
surveillance, and bank officials are apprised of the
criticisms of bank examiners. Subsequent conduct in
response to these criticisms is also closely observed and
reported to bank officials. To go beyond this and require prior approval of bank loans and investments
by public authorities, would fundamentally alter the
relationship between the government and the banking industry. Indeed, it could communize and socialize
the banking industry and, indeed, the entire economy
without additional steps. It would entail government
allocation of resources, a concept which is wholly repugnant to a private enterprise system. I cannot believe that anyone would seriously advocate this more
intensive form of bank regulation.
The course we have chosen—to place greater reliance on the initiative and enterprise of the individual banker—is the only course that is in keeping
with our traditions. It is the only course that can as-




sure the most effective participation of the banking
industry in the Nation's progress.
Disclosure and control
The effective operation of a private enterprise
system rests in no small degree upon informed producers, consumers, and investors. We have sought
to bring this discipline of the market to bear on the
banking industry through the measures we have instituted to require the disclosure of information to
shareholders and reports on ownership and control of
banks. Here again, to take the further step and require prior approval of ownership changes, would
entail a fundamental change in the relationship between the government and the banking industry.
Some facts
I should like now to turn to some more mundane
matters. A variety of figures are being cited as indicative of the rate of recent bank chartering. The
implication has been that a vast expansion has taken
place in the National Banking System at the expense
of the companion State banking systems. While I do
not believe that the wisdom of bank chartering policy
can be judged by such a measure, I do believe that
we should set the record straight on the facts.
During the period 1952 through 1964, charters were
issued to 1,166 new State banks and 661 new National
Banks. For every year from 1952 through 1962, there
were from two to four times as many new State banks
chartered as there were National Banks. During the
past 3 years, charters were issued to 434 new National
Banks and 392 new State banks. This represents an
average annual increase in bank population of less
than 2 percent.
There are also other interesting comparisons which
may be made. During the period 1952 through 1964,
the gross national product rose from $347 billion to
$622 billion. This represented approximately an 80
percent increase. During this same period, bank capital rose from about $13 billion to about $28 billion,
an increase of 114 percent; and bank assets rose from
$189 billion to $340 billion, an increase of about 80
percent. The business-failure rate during this period
ranged from 28.7 to 64.0 per 10,000 firms, while the
bank-failure rate ranged from 0 to 5.2 per 10,000 banks.
The high for the period in the case of banks was
reached in 1964. It may be noted that the 1964
failure-rate for National Banks was 2.1 per 10,000
banks, whereas the failure-rate for State banks was 6.9
per 10,000 banks.
245

The future
By any test, the banking industry has become a more
effective, driving competitive force throughout the
economy. There is a steady flow of new capital into
banking, and earnings are being retained at a high rate
for added strength in meeting the enlarged responsibilities and opportunities. Successful businessmen
from other fields are being attracted to the industry
in greater numbers, and have added new spirit and
initiative to this ancient craft. Management competence throughout has reached new heights, and the
banking industry is better prepared than ever before,
both in spirit and in substance, to serve its vital function in furthering the Nation's growth and development. The future has never been so challenging nor
so bright.
BEFORE THE HOUSE BANKING AND CURRENCY COMMITTEE, MONDAY, APRIL 26, 1965
Mr. CHAIRMAN, MEMBERS OF THE COMMITTEE: I

appear here today to express my views on commercial
bank underwriting of revenue bonds.
As was stated in the Economic Report to the Congress in January of this year, we must help our cities
to develop the transportation, housing, and other facilities which they need. It is my view that this bill constitutes a most important contribution to this effort.
Since the end of World War II, borrowing by state
and local governments to finance such facilities has
increased annually at an unprecedented pace. These
needs have caused annual spending by State and local
governments for goods and services to rise from an
amount under $8 billion in 1941, to over $65 billion at
this time. As a result, outstanding long-term obligations of State and local governments now total around
$90 billion, and State and local governments sold
over $10.5 billion of securities in 1964.
In recent years, increasing reliance has been placed
on the revenue bond as a means of financing by State
and local governments. From negligible figures in the
early 1930's, the annual amount of revenue bonds issued rose to about $500 million in the early post-World
War II years. This figure has climbed to almost $4
billion in 1964. While in the late 1940's, revenue bonds
accounted for less than 20 percent of new State and
local bond issues sold, they have continued to increase
and now account for almost 40 percent of State and
local government financing.
The use of revenue bonds for self-liquidating projects has been invaluable in helping State and local
governments meet their financial needs. Indeed,
246




revenue bonds are, in many instances, the only practical way in which many an already overtaxed community may solve its pressing problems on a financial
basis which is sound for both the issuing community
and the bond investor.
Revenue bond financing is therefore of tremendous
importance to both State and local governments. Any
measure which would lower the cost of such financing
would be of significant benefit to these governments.
It is our belief that H.R. 7539 will afford substantial
savings to State and local governments and ultimately
to their taxpayers. It would increase competition in
the bidding for and distribution of revenue bonds. It
would broaden and strengthen the market for revenue
bonds. The resulting enlarged market would enhance
their attractiveness as investments. Even small banks,
intimately familiar with the needs of their communities, could provide essential assistance in the preparation and marketing of revenue bond issues of their
communities. Throughout the country, investors,
who customarily rely on their bank for information
concerning tax-exempt securities, would become more
interested in sound revenue bonds. Finally, permitting the banks to trade in and make markets in
revenue bonds would improve their marketability and
character as liquid investments suitable for bank portfolios and fiduciaries generally. Commercial banks
have the facilities and capabilities needed to make
markets in many of the smaller revenue bond issues.
Opponents have argued that the only saving to the
borrowing governments, resulting from this increased
competition, would be a slight reduction in "spreads,"
that is, the difference between the price the underwriters pay for an issue of bonds and the price at
which they sell it to the investor. Even if we assume
this argument is valid, such a saving would be substantial and significant when multiplied by the billions
of dollars of revenue bonds being issued annually.
There is an even more basic flaw in this argument.
Its advocates assume that a presumption exists in
favor of the existing competitive restrictions. They
demand proof that benefits would result from removing the restrictions rather than beginning with the
presumption that restrictions on competition are unwarranted unless they can be justified by overriding
public interest considerations. Their method of approval is contrary to the fundamental premises of our
American philosophy. We have seen absolutely no
evidence that it is in the public interest to deny commercial banks greater competitive latitude in this area.
This bill would not substantially increase the risks
incurred by commercial banks. It would permit them

to deal in and underwrite only the same types of securities which they are at present allowed to purchase
for their own accounts. No bank, therefore, would
be allowed to purchase for underwriting any security
which it may not presently buy for its own investment
account. Moreover, the bill would limit the total
amount of securities of any one issuer which a bank
could hold at any one time, whether as a result of an
underwriting transaction or in its dealer or investment
accounts, to a total amount not in excess of 10 percent
of the bank's capital stock and surplus. Accordingly,
under this bill, no bank could acquire investment securities of lesser quality or in greater amount than that
which it is now permitted to acquire for its investment
portfolio. There is in fact less risk in underwriting, a
typically short-term transaction, than there is in investing, as that term is ordinarily used.
It has been suggested that there is a danger of conflicts of interest between the underwriting function and
the deposit, investment, and trust functions of banks.
It is contended, for example, that banks underwriting
securities would have an interest in selling these securities to depositors and correspondents and that such interest would impair the ability of those banks to give
disinterested advice. Firstly, it should be noted that
the increased knowledge concerning the issuer and the
market, which an underwriting bank would have,
would greatly enhance its ability to give accurate and
helpful investment advice. Secondly, it should be recognized that the business of providing correspondent
services, of which investment portfolio advice is but a
part, is a highly competitive one. It is unrealistic to
contend that an underwriting bank could recommend
inferior securities to its customers because of its having
underwritten such securities. The threat of losing
its correspondents and their deposit accounts in a
highly competitive atmosphere will afford adequate assurance that the underwriting bank will give the best
possible advice to its correspondents.
The opponents suggest that commercial banks might
be tempted to sell securities which they have underwritten to their trust accounts. They cite no evidence
of such self-dealing on the part of commercial banks
engaged in underwriting general obligations and there
has been no reason given as to why this problem will
suddenly exist in the case of revenue bonds. However, any such possibility has been obviated by the
bill itself, which provides that the purchase of revenue
bonds by a bank as fiduciary from itself as an underwriter or dealer shall not be permitted, unless lawfully
directed by court order.




Even without this amendment, any such possibility
is obviated by the provisions of our regulation 9 and
by applicable examination procedures of this Office.
Regulation 9 was issued in execution of our general
supervision of trust departments of National banks
and expressly prohibits the use of fiduciary funds to
purchase property or obligations from the bank unless
lawfully authorized by the governing instrument, by
court order, or by local law. Regulation 9 is enforced
by this Office irrespective of the intrinsic qualities of
the property or obligations involved. This injunction
against misuse of fiduciary funds involves a fundamental precept of fiduciary law which is widely recognized in the courts of this country.
The bill excludes from those investment securities
which a commercial bank may underwrite or deal in,
special assessment obligations and industrial development obligations. This Office has no objection to either
of these exclusions.
We believe that this bill would enable the commercial
banks to make a substantial contribution toward assisting state and local governments in the next decades
when their financial needs will spiral and when they
will need all possible assistance. In 1963, we changed
our Investment Securities Regulation to clarify the definitions of the term "political subdivision" and "general obligation" so as to take account of changes that
have occurred in government financing in the past
30 years. Although we believe that our Investment
Securities Regulation now permits the banks in some
degree to perform their functions in this area of public
finance, in order to achieve the full benefits of bank
participation in this market, we strongly endorse the
passage of H.R. 7539.
BEFORE THE SUBCOMMITTEE ON BANK SUPERVISION
AND INSURANCE OF THE HOUSE COMMITTEE ON
BANKING AND CURRENCY, FRIDAY, APRIL 30, 1965

Bank Performance and Bank Regulation
I apprised the Secretary of the Treasury of the committee's request that I testify, and the Secretary has
authorized me to present my personal views to the
committee.
The best test of the effectiveness of bank regulation
is the performance of the banking industry itself. This
performance is now at record levels throughout the
country. Deposits, loans and investments, and profits
have reached new heights—and they continue to grow.
Added banking facilities are being brought to areas
which long had suffered deficiencies. The services
offered to bank customers are being progessively
247

broadened. The banking system is alive and teeming with energy. The consuming public is the ultimate
beneficiary of all this activity.
The record performance of the banking industry
reflects a greater awareness by the regulatory authorities of the obligation to allow sufficient scope for innovation and initiative in banking to meet growing and
changing consumer requirements. Consumer needs
for banking services are constantly undergoing change
as our population grows, as new industries develop,
and as new communities arise. The banking industry
cannot meet these changing demands unless the
regulartory authorities constantly adapt their policies
to the new opportunities and the new requirements.
The present bank regulatory structure, by dispersing the centers of public power, has preserved a
variety of sources from which initiative may appear
in fashioning bank regulation according to public
needs. Beyond the powers over National Banks which
rest with the Comptroller of the Currency, the 50 individual States charter and regulate State banks, although they share this power in some major respects
with the Federal Reserve Board or the FDIC. This
diffusion of public authority offers the best safeguard
against stagnation in bank regulation, and the best
hope that the banking industry will be allowed the
freedom to make its maximum contribution to the
Nation's economic growth and development.
Your committee now has before it several bills which
propose modification of the existing bank regulatory
structure. I should like to suggest to the committee
some very fundamental issues which are raised by
these proposals.
Perhaps the most fundamental issue in bank regulation is the role of the dual banking system. In current discussions of bank regulatory policies, the suggestion is made that there should be greater uniformity,
or at least greater consistency, within the Federal regulatory structure, and, of course, by the same token,
greater uniformity or consistency among the laws,
regulations, and policies of the 50 individual States.
The 50 individual States now have broad freedom to
adopt banking policies of their own choice in any form
they may select. If meaningful uniformity or consistency were to be sought, this freedom would have to be
curbed. It would be necessary for the Federal Government to assert authority over the entire commercial
banking industry, and to impose uniform policies
throughout, as the Congress has the power to provide.
If all Federal powers over commercial banks were
centralized, a single Federal agency would gain the
authority to choose between National and State banks
248




in deciding what new banks to charter, which banks
should be allowed to branch or merge, and in authorizing and regulating holding companies. We do not
face this problem today, because, for the most part, no
Federal agency has jurisdiction in these matters over
both National and State banks. The likely result of
centralizing Federal banking powers would, therefore,
be a federally imposed and a federally enforced plan
for the entire structure of the commercial banking industry of the country.
If Federal powers affecting the lending and investment practices of commercial banks were to be centralized, a single Federal agency would gain vast authority over the volume and the allocation of credit
throughout the economy. This agency would be in a
position to influence critically both the pace and the
direction of the Nation's economic growth and development. It is difficult to reconcile such centralized
public power with the principles of our private enterprise system.
BEFORE THE HOUSE COMMITTEE ON BANKING AND
CURRENCY, WEDNESDAY, JUNE 30,1965

Mr. Chairman, yesterday I was presented with a
document which challenged 29 actions of our Office.
We have no question as to the legal and economic
soundness of these actions. Our Law Department is
now assembling the detailed replies to each item on
that list, and I request that these responses be made
part of the record.
The document reflects a fundamental misunderstanding of the congressionally mandated function of
this Office vis-a-vis the National Banking System in
particular and the American economic structure in
general. The dual banking system was created by a
mandate of our Congress over a century ago, and their
intention, as I see it, was to provide for Federal regulation of national banking in a growing and changing
private enterprise economy. The National Banking
Act is not a merchandise mail-order catalog. It is
rather, like the Constitution of the United States, a
framework under which National Banks may employ
their inventiveness and capacity for change to respond
to the needs of our growing industry and commerce,
both domestic and international.
The document also assumes that any departure from
the position of any Comptroller of the Currency since
1863, or indeed of any other banking agency, is somehow improper. I would point out that even the courts
of this land, whose appreciation of the value of precedent and consistency is probably stronger than that
of any other branch of the Government, do not hesitate

to change previous positions where the passage of time
and changing circunastances have rendered obsolete
their prior judicial opinions.
Our primary aim since assuming office has been to
modernize the regulatory structure for National Banks
and to carry out effectively the century-old congressional intent of a vital dual banking system. Virtually
all of the subjects contained on the list in question had
not been examined by any Federal banking authority
for many years prior to our work on them. The
business of banking, like all other institutions in the
20th century, is undergoing rapid and continuous
change. The inevitable responses of our Office must
take place in a flexible statutory and administrative
framework. Obviously, banking cannot survive with
vitality under rigid and stagnant regulation, as had
too long been the case.
We strongly believe that our administrative, procedural and regulatory determinations, including those
set forth by the chairman, are not only unquestionably well-supported in law but also equally wellfounded in the basic philosophy of this country concerning the relationship of government to business.
We are a private enterprise economy and we place
primary reliance on individual initiative. Consistent
with this philosophy, governmental limitations are imposed only where there is clear public purpose to be
served, and those limitations must be strictly interpreted so as to avoid needless interference with the free
discretion of the individual.
In applying this philosphy to bank regulations, we
strongly believe that the presumption should be in
favor of freedom of initiative and innovation by the
individual banker. The same policy, it appears to me,
is incumbent upon the bank regulatory agencies. The
bank regulatory authorities, State and Federal, as
any other regulatory authority, have an affirmative
responsibility to assure that the regulated industry has
the tools and the capacity to carry out its role with
maximum effectiveness. Excessive reliance on the
"negative crutch" of all-knowing government—
whether at the State or Federal level—can lead only to
stagnation and regression. Not all the financial knowhow of this great country is lodged in the "genius" of
the financial and monetary regulatory agencies in
Washington. Hence, the banking authorities should
set, as their goal, the broadest reliance upon the initiative of the individual banker consistent with the specific proscriptions of the banking statutes.
It is difficult to see how any other policy can serve
the consumers of banking services whose critical needs
are our ultimate concern in framing public policy and




regulation in this field. Only a vital, competitive,
vigorous, innovational commercial banking industry
can advance the interest of the United States—at
home and abroad—and the well-being of all of its
citizens.
Clearly, a rigid, stagnant backward-looking regulatory, administrative, and procedural policy can in
time only strangle the commercial banking business
and with it the business community and economy of
the country.
It is, in my opinion, extraordinary even to suggest
that the test of propriety of administrative or procedural rulings should be a rigid and unchanging conformance to all rules of the past, however ill-conceived
or narrowly construed they may be in in terms of law
or economic policy. Shall I, as Comptroller of the
Currency, be ever foreclosed from changing any rule,
regulation, interpretation or policy of this Office laid
down by Mr. Hugh McCulloch, the first Comptroller
of the Currency who left this Office in 1865, or indeed
any of his successors, over the last 100 years?
It seems equally extraordinary to me to suggest that
a difference between any ruling or policy of this Office
and a ruling or policy of another agency would, by
some intellectual gymnastic, automatically open the
rulings of this Office to question. If, as has been the
case for decades, other agencies have not reexamined
their own rules, how can such a test be in any sense
a reasonable basis for judging any rule of this Office?
Should we be inextricably bound to the past when we
face a future alive with change, progress and
confidence?
The following are the answers to the 29 allegations referred to above.
1. Appointment of Additional Deputy Comptrollers of
the Currency
The charge of illegal action as listed in the specification sheet is the "appointment of seven Deputy Comptrollers of the Currency" in violation of 12 U.S.C. 4.
Section 4 states that "the Secretary of the Treasury
shall appoint no more than four Deputy Comptrollers
of the Currency." The fact is that the statute was
strictly complied with in that the Secretary of the
Treasury has not appointed more than four Deputy
Comptrollers of the Currency.
The Comptroller, pursuant to his general authority
to execute his duties and administer his bureau, appointed three additional administrative aides whom he
designated Deputy Comptroller for Trusts, Deputy
Comptroller for Mergers and Branches, and Deputy
Comptroller for International Banking and Finance,
249

respectively. These three assistants to the Comptroller
were appointed in order to implement an administrative reorganization of the Office whereby duties were
assigned by function rather than by geographical
region. To characterize the granting of these titles
rather than some other title, such as a special assistant,
as a violation to 12 U.S.C. 4, is to grossly overemphasize
the effect of this administrative action and to assert
form over substance. The three appointments were
not made by the Secretary pursuant to Section 4 and
the salaries of the three employees concerned were not
fixed by the Secretary pursuant to Section 4. All three
employees had previously been employed in the Office
of the Comptroller as attorneys for some time prior to
their assuming their new administrative duties.
2. Access to Shareholder Lists
The Office has not published any ruling or interpretation on the subject of rights of shareholders of
National Banks to inspect the complete list of shareholders. The subject of such inspection has been
traditionally handled by the courts of general jurisdiction in the location at which a bank is situated and
there are a number of court decisions on the point.
This Office, in reply to written inquiries from National Banks, has advised that it would not intervene
in disputes between shareholders and officers and directors over the granting of access to the shareholder
list and that the proper forum for the resolution of
such disputes is a court. Accordingly, we have
advised officers and directors that if the Board of
Directors is of the opinion that a request to inspect a
shareholder list is not made in good faith and for a
purpose inimical to the best interests of the bank,
that this Office would not object to a refusal by such
Board of Directors to turn over the list until ordered
to do so by a court of competent jurisdiction.
We do not see how the position of the Office, as
communicated to these inquirers, constitutes any violation of 12 U.S.C. 62, which requires that National
Banks keep a list of its shareholders "subject to the
inspection of all the shareholders and creditors of the
association."
3. Charitable Foundations
It is stated in paragraph 7445 of the Comptroller's
Manual that a National Bank may, upon certain
stated conditions, establish a charitable foundation to
assist in making the charitable contributions permitted by paragraph Eighth of 12 U.S.C. 24. This ruling
is challenged on the grounds that it is not provided by
law and that it conflicts with the provisions in para250




graphs Seventh and Eighth of 12 U.S.C. 24. These
objections, in light of those provisions of 12 U.S.C.
24, appear frivolous.
Congress clearly stated in paragraph Eighth of 12
U.S.C. 24 its intention regarding charitable contributions when it authorized National Banks "to contribute
to community funds, or to charitable, philanthropic,
or benevolent instrumentalities conducive to public
welfare, such sums as its board of directors may deem
expedient and in the interests of the association, if
it is located in a State the laws of which do not
expressly prohibit State banking institutions from
contributing to such funds or instrumentalities."
Congress, with equal clarity in paragraph Seventh of
12 U.S.C. 24, also granted to National Banks "all
such incidental powers as shall be necessary to carry
on the business of banking."
It is entirely reasonable; and consistent with these
clear expressions of Congressional intent to conclude
that a National Bank may establish a charitable
foundation to assist in making the charitable contributions permitted by paragraph Eighth of 12 U.S.C.
24. As is evidenced by their widespread acceptance
and use by businesses generally, charitable foundations, either in the form of a charitable trust or nonprofit corporation as provided by State law, constitute
a most useful and efficient means of implementing a
bank's program of making contributions. Any assertion that such use of a charitable foundation by a
National Bank is prohibited by provisions contained
in paragraph Seventh of 12 U.S.C. 24, which prohibit
investment by a National B:ank in corporate stock in
certain circumstances, reflects lack of understanding
with respect to their meaning, purpose, and legislative
history. These provisions serve only to limit the securities in which a National Bank may invest its funds.
Similarly, such an assertion reflects a disregard for the
judicial recognition of the authority of National Banks
to lawfully carry on certain of their activities either
directly or indirectly, through a subsidiary corporation. As stated, Congress has, in paragraph Eighth
of 12 U.S.C. 24, concluded that it is a proper activity
for National Banks to contribute to charitable funds
and instrumentalities. There is no sound basis for
concluding that a National Bank may not lawfully
carry on this activity through a trust or subsidiary
corporation. Acceptance of their use by National
Banks has been consistently recognized by previous
Comptrollers, as is evident from paragraph 7220 of
the Comptroller's Digest of Opinions which predated,
and contained language almost identical to that contained in paragraph 7445 of the Comptroller's Manual.

4. Contributions !o Community Development Corporations
It Is stated In paragraph 7480 of the Comptroller's
Manual that National Banks, as a necessary business
expense, may make reasonable contributions to local
community agencies and groups to further the physical,
economical, and social development of their communities, and that such contributions may take the
form of investment in a corporation organized to carry
on such activities. This ruling is challenged on the
basis that it is not provided for by law and that it violates paragraph Seventh of 12 U.S.C. 24, which
relates to the purchase of corporate stock by a National
Bank. These objections, similar to those made against
the establishment of a charitable foundation by a National Bank, are without merit.
Paragraph Eighth of 12 U.S.C. 24 authorizes a National Bank "to contribute to community funds, or to
charitable, philanthropic, or benevolent instrumentalities conducive to public welfare, such sums as its board
of directors may deem expedient and in the interests
of the association, if it is located in a State, the laws
of which do not expressly prohibit State banking institutions from contributing to such funds or instrumentalities." As an application of this authority, it
is stated in paragraph 7480 of the Comptroller's
Manual that National Banks, as a necessary business
expense, may make reasonable contributions to local
community agencies and groups to further the physical,
economic, and social development of their communities. Such contributions may take the form of an
investment in a corporation organized to carry on such
activities. The aggregate investment in such corporations may not exceed 2 percent of the bank's capital
and surplus. This ruling not only is an implementation of paragraph Eighth of 12 U.S.C. 24; it is intended
to encourage National Banks to assist, and assume their
proper responsibilities within their communities. It
is a means by which National Banks may play a role
in the President's program of building a truly great
society through private initiative and resources.
It is entirely consistent with the clear expression of
Congressional intent contained in paragraph Eight of
12 U.S.C. 24, which permits contributions to community funds and instrumentalities conducive to public welfare, that a National Bank make such contributions in the form of an investment in the stocks or bonds
of a corporation organized to carry on such activities.
Paragraph Eighth contains no standard or limitation
with respect to the form that such contribution may
take. The Comptroller's Office has, with respect to
National Bank contributions in the form of investments




in the stocks or bonds of a development corporation,
recognized that such investments generally do not
qualify as "investment securities" within the meaning
and requirements of the Investment Securities Regulation and has therefore held that all such investments,
which do not meet the requirements of that Regulation, must be charged off as a business expense and not
be carried as part of the bank's assets.
5. Stock Option Plans
It is stated in paragraph 5015 of the Comptroller's
Manual that a National Bank may provide employee
stock option and stock purchase plans in accordance
with applicable regulations of this Office. This ruling
is challenged on the grounds that it is not provided for
by law nor permitted by previous Comptrollers.
The use of employee stock option plans by corporations was implicitly approved by Congress when it
granted certain tax privileges with respect to such plans
in Sections 421 and 422 of the Internal Revenue Code.
No reason has been advanced why banks, as distinguished from other corporations, should not be permitted to have such plans.
National Banks have long been handicapped in obtaining and retaining competent executives because
they were not permitted to offer stock options as a form
of incentive compensation. The obstacle had been a
prohibition against the holding of Treasury stock, and
the apparent unwillingness of previous Comptrollers
to permit the banks to have authorized but unissued
stock. In order to implement a stock option plan, it is
necessary for a bank to have a supply of shares ready
for issuance under the plan when and as the employees
elect to exercise their options or purchase rights. Our
ruling permitting the banks to have authorized but
unissued shares removed the only technical obstacle to
the adoption of stock option plans.
In order to control the use of the stock option privilege and see that it is not abused, we have exercised
strict control. Before any National Bank may put into
effect an employee stock option or stock purchase plan,
it must obtain approval of our Office and the approval
of the holders of two-thirds of its outstanding shares as
to all of the provisions of the plan. We require that
the plan be administered by a disinterested committee
of directors and that the total amount of shares allocated to the plan and the proportionate amount
which any one employee may be granted are held
within reasonable limits.
In our original ruling, we required that all plans
qualify for the special tax treatment afforded by Section 421 of the Internal Revenue Code. Since the
251

passage of the recent amendments to the Internal Revenue Code, many banks have expressed interest in
adopting employee stock option or stock purchase plans
which might not qualify for the special tax treatment
afforded to restricted and qualified plans meeting the
definitions contained in the Code.
Employees and banks operating under a nonqualified plan presumably would be subject to taxation in
the usual manner on transactions entered into pursuant thereto. This Office perceived no consideration
of public policy which should prevent the management
of a National Bank, desiring to adopt a nonqualified
plan, from doing so on the basis of the same business
and competitive conditions which govern the actions
of business corporations generally in this area.
Accordingly, we recently amended our regulations to
eliminate as a prerequisite to the approval of this
Office, that stock option or purchase plans must
qualify for preferential tax treatment under the Internal Revenue Code of 1954, as amended. In place
of the former requirements, a set of general guidelines
for such plans was adopted.
6. Access to Examination Reports to the FDIC
The allegation is made that "for one year beginning
February 1964" the Comptroller of the Currency did
not permit access to examination reports of National
Banks to the FDIC. The position of this Office has
never been to deny to the FDIC the access to its
examination reports required by 12 U.S.C. 1817. The
issue, as has been widely reported and is well known,
is whether the Office of the Comptroller, which operates entirely on nonappropriated funds, is required
to grant such access free of charge. There is nothing
in 12 U.S.C. 1817 or indeed in any other statute which
prohibits the making of a reasonable charge for copies
of such reports which are prepared at great expense to
this Office. Section 1817 vests the FDIC with the
authorization necessary to becoming privy to contents of National Bank examination reports. It is a
clearance or authority to have access to examination
reports, to assure that access would not be denied to
the FDIC on the basis of the lack of status required to
become privy to such information. There is nothing
in this provision or in any other law requiring the
Comptroller of the Currency to furnish the FDIC
with copies of National Bank examination reports free
of service charge.
The request by the present Comptroller that reasonable charges be paid for copies of National Bank examination reports is not a novel one. Since 1921, the
Federal Reserve System has recognized the equity of
252




service charges for copies of National Bank examination
reports. In that year, Comptroller of the Currency
D. R. Crissinger announced that arrangements had
been made with the Federal Reserve Board under
which Federal Reserve Banks would pay for reports
provided by the Comptroller.
In 1957, Comptroller of the Currency Raymond F.
Gidney proposed that both the Federal Deposit Insurance Corporation and the Federal Reserve System
share with the Comptroller's Office the heavy cost of
National Bank examination reports.
In 1962, an agreement was reached between the
Federal Reserve Board and the Comptroller's Office
whereby the Federal Reserve Banks would pay the
Comptroller's Office a fee of $100 for each examination report which they wished to retain in their own
files. In addition, the agreement provided that the
Federal Reserve Board staff in Washington could obtain copies of examination reports at no charge. The
FDIC, since its inception in 1933, has declined to pay
for copies of examination reports.
In 1962, following the agreement between the
Federal Reserve Board and the Comptroller of the
Currency, the Comptroller suggested to the FDIC
that the matter of an equitable charge for examination reports be submitted to the Comptroller General
of the United States for review, with the understanding that both banking agencies would abide by the
Comptroller General's determination. The FDIC
declined to submit the question to arbitration by the
Comptroller General.
Every one of the eight Comptrollers of the Currency
since 1921 has favored service charges for examination
reports. They have contended that National Banks,
through the costs involved in their membership in the
Federal Reserve System and the FDIC, were in effect
helping to subsidize the examinations which the Federal Reserve and the FDIC make of state banks at
no charge.
In any event the FDIC presently is being given
access to the reports. During the period referred to
in the specification sheet, physical changes in our filing
setup caused a temporary suspension of the arrangements for access. It is our understanding that during
this period the FDIC received copies of the reports
from the Federal Reserve.
7. Purchase and Sale of Federal Funds

It is stated in paragraph 1130 of the Comptroller's
Manual that when a bank purchases "Federal funds"
from another bank, the transaction ordinarily takes
the form of a transfer from the seller's account in the

Federal Reserve Bank to the buyer's account therein,
payment to be made by the purchaser, usually with
a specified fee. The transaction does not create an
obligation subject to the lending limit or a borrowing
subject to 12 U.S.C. 82, but is to be considered a purchase and sale of such funds. This ruling is challenged on the grounds that it is contrary to rulings
of previous Comptrollers, and that it is contrary to
the provisions of 12 U.S.C. 82 and 84.
Earlier Comptrollers took the position that, when
a National Bank acquired, through "purchase," Federal Reserve funds from another bank, such acquisition taking the form of a transfer of the funds from
the "seller's" account to the "buyer's" account in the
Federal Reserve Bank, with payment to be made by
the "buyer" usually with a specified fee, the transaction
was a loan by the "seller" bank to the "buyer" bank,
and the amount of such "loan" could not exceed the
statutory lending limit of the "seller" nor the statutory
borrowing limit of the "buyer."
However, such purchases and sales are in reality,
and are so recognized by the banking industry, trading
in an established money market. It is in truth a buying of money for a short-term use. The Comptroller's
Office has, therefore, held that, consistent with custom
and practice within the banking industry, transactions
of this nature constitute purchases and sales of funds
under which no obligations arise that are subject to
the lending limitation of 12 U.S.C. 84. Similarly,
such transactions are not subject to 12 U.S.C. 82
which imposes borrowing limitations on National
Banks. To impose these limitations merely because
previous Comptrollers viewed these transactions in a
different light would be to perpetuate a position for
its own sake without regard to its legal correctness.
In this connection, it is noted that a significant number of State bank supervisors view these transactions
in the same manner as does the Comptroller's Office.
8. Corporate Savings Accounts
It is stated in paragraph 7510 of the Comptroller's
Manual that a National Bank may accept savings accounts without regard to whether the funds are deposited to the credit of one or more individuals, or of a
corporation, association or other organization, whether
operated for profit or otherwise. This ruling is challenged on the basis that it is contrary to a regulation of
the Federal Reserve Board although no question has
been raised with respect to its being legally correct.
After a thorough and careful study of the 1935
statute (12 U.S.C. 461), and its legislative history, as
well as the regulations and opinions of the Federal
Reserve Board issued both before and since the statute,




the Comptroller's Office concluded that the authority
of the Board of Governors of the Federal Reserve System to define the terms "time deposits" and "savings
deposits" extends only to the terms of the deposit contract, such as a description of withdrawal requirements
and interest rate limitations and that there is nothing
contained in the statute that would preclude, or that
would authorize a Regulation which would preclude,
the maintenance of such accounts by any class of depositors. There is neither legal jurisdiction, nor any
authority in the Board, to define "savings deposits" by
the character or general purpose of the depositor.
The legal issue is whether or not the Federal Reserve
Board has exceeded its authority by defining time deposits and savings deposits by the character or general
purpose of the depositor. The fact that the Comptroller's Office has called attention to this abuse of authority is of secondary significance. Of primary importance is the fact that the study and analysis of the
legal issues by the Comptroller's Office was prompted
by economic considerations and the need for National
Banks to serve the public in their own service areas.
The Comptroller's ruling eliminates two types of discrimination: between large and small firms; and between commercial banks and other financial intermediaries.
The Federal Reserve Board allows savings deposits
to individuals of unlimited means and to nonprofit
corporations, associations, or other organizations possessing vast fortunes while it refuses such "privilege"
to a small corporate business enterprise. Banks should
be encouraged and enabled to assist these small business
firms which are ill-equipped to operate in short-term
money markets. The knowledgeable and sophisticated treasurer of the large corporation is not unduly
restricted by this overextension of authority on the part
of the Federal Reserve Board. It is the small unsophisticated corporation which is the real injured party
under the Board's regulation. The discrimination between commercial banks and other financial intermediaries results from the fact that these other financial
institutions, primarily savings and loan associations,
are allowed to accept savings deposits of this type.
Attached is a copy of a detailed memorandum previously prepared by the Comptroller's legal staff with
respect to the authority of the Federal Reserve Board
to prohibit business corporations or any other particular class of depositors from maintaining savings
accounts.
9. Reporting Requirements for International Operations
The International Operations Regulation of the
Comptroller (12 CFR 20) sets forth certain reporting
253

requirements with respect to the international operations of National Banks.
This Regulation is challenged on the grounds that it
amounts to dual regulation contrary to Section 25 of
the Federal Reserve Act (12 U.S.G. 601) which is said
to vest the Federal Reserve Board with complete authority to regulate the foreign operations of all member banks, including National Banks.
Section 25 of the Federal Reserve Act specificially
provides in the sixth paragraph (12 U.S.C. 602) that
every national banking association operating foreign
branches shall be required to furnish information concerning the condition of such branches to the Comptroller of the Currency upon demand. This language
plus that contained in 12 U.S.C. 161 constitutes complete authority for the reporting requirements contained in the International Operations Regulation of
the Comptroller. Furthermore, it (12 U.S.C. 602)
constitutes Congressional recognition that the Comptroller has a continuing responsibility for the operation,
regulation and supervision of National Banks although
some phases of their operation may also be subject to
regulation by the Federal Reserve System.
10. Direct Acquisition of Stock of Foreign Banks
It is stated in paragraph 7525 of the Comptroller's
Manual that a National Bank may acquire and hold
directly and indirectly stock interests in foreign banks
as a means of conducting its overseas operations.
This ruling is challenged on the grounds that the
Edge Act permits only an indirect equity interest in
foreign banks; that it is "contrary to FRB Ruling 1000
promulgated unde rthe authority of 12 U.S.C. 601";
and that it is contrary to 12 U.S.C. 24 which is said to
prohibit corporate stock purchases by National Banks.
The Federal Reserve ruling referred to (1964 FRB,
p. 1000) is an interpretation of language contained in
12 U.S.C. 24 and of the application of that language
to State member banks pursuant to the provisions of
Section 9 of the Federal Reserve Act (12 U.S.C. 335).
Our interpretation of the language contained in 12
U.S.C. 24 will be discussed later. It should be noted,
however, that the ruling was published, 29 FR 9787,
12 CFR 208.112, as a part of Regulation H. Regulation H relates to the membership of State banking institutions in the Federal Reserve System and is based
upon and issued pursuant to the provisions of Section 9
of the Federal Reserve Act (12 U.S.C. 321 et seq.)
and related provisions of law. Section 9 also relates to
State banks as members of the Federal Reserve System.
The ruling thus purports to apply only to investments
by State member banks in the stock of foreign banks.
254




The corporate powers of National Banks are set
forth in 12 U.S.C. 21 and 24 which authorize the
formation of an association for carrying on the "business of banking" which shall have power to exercise
"all such incidental powers as shall be necessary to
carry on the business of banking." These are broad
powers which have never been and should not be completely defined. The banking business must meet the
financial needs of our continually growing society.
This was recognized by the House Banking and Currency Committee when it recommended the adoption
of the McFadden Amendments of 1927. The Committee made the following comment with respect to
provisions relating to the holding of stock in a safe
deposit corporation and to the investment security
business that had appeared in an earlier bill as new
grants of power:
* * * they now appear as a confirmation and regulation of
an existing banking service or business. It is a matter of
common knowledge that national banks have been engaged
in the investment-securities business and the safe-deposit
business for a number of years. In this they have proceeded
under their incidental corporate powers to conduct the banking business. [The bill] * * * recognizes this situation but
declares a public policy with reference thereto and thereby
regulates these activities. Page 2, H. Report No. 83, 69th
Congress.

The claim that 12 U.S.C. 24 prohibits corporate
stock purchases by National Banks is based upon the
following sentence:
Except as hereinafter provided or otherwise permitted by
law nothing herein contained shall authorize the purchase by
the association for its own account of any shares of stock of
any corporation.

This sentence was added in 1933 as a part of the revision and clarification of the Congressional regulation of
the business of dealing in securities and stock and the
purchase of investment securities by a bank for its own
account. The sentence is clearly a disclaimer that
these related powers constitute authority for a bank to
purchase corporate stock as a part of its investment
portfolio. It does not preclude a bank from using
corporate instrumentalities in carrying on the business of banking. One of the earliest recognitions of
this power was the judicial recognition that a bank
could hold real estate necessary for its accommodation
in the transaction of its business either directly or indirectly through a corporation. Fourth Nat. Bank v.
Stahlman 178 S.W. 942 (Tenn. 1915). This power
was later recognized and regulated by Congress in 12
U.S.C. 371 (d).
Similarly, the Edge Act does not constitute a grant
of power to National Banks but rather a plan for

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I i i il « Comptroller
\» r •" i a j T» s c - u ^ d h v ^% \'atioi al Banku" Lu s ^ f i 11 T ( u U M ) 1 ll I us cf t^e United
S< Ut i J | iq, <i t'r " M" i^ / i t >r, f i )f"icn, regula.>
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securities. We have endeavored to do that and to
balance off the considerations of public policy that
sometimes diverge in attempting to maintain depositor
confidence while at the same time keeping investors
informed. Furthermore the Amendments Act specifically states that the existing rules, regulations and
orders of the Securities and Exchange Commission
are not to be binding on the banking agencies.
It must be remembered that our Office was the
first banking agency ever to require the use of annual
financial reports to shareholders, the first banking
agency ever to require the use of proxy statements,
and the first banking agency ever to require reports
of change of ownership control of banks. All these
requirements were imposed by our Office in December
of 1962, a year and a half before the Securities Acts
Amendments were passed.
Our regulations still require disclosure in a very
important area which neither the act nor the other
banking agencies have touched—that of the public
sale of securities by new banks and existing banks.
We require a full registration statement and offering
circular to be used by every newly organized or existing
bank going to the public for $1 million or more. The
Fed. and F.D.I.C. rules do not impose cuch a
requirement.
12. Purchase and Operation of Mortgage Service
Company

The ruling which recognizes the right of a National
Bank to purchase the stock of a mortgage service
company and to operate such company is challenged
Tl
' S ^sare »fo U lati s 12 C . R 10, 11, 12
on the grounds that it is not provided for by law and
K
K
and 1^ ! > fv' \ t e ( i p t ^ ' l e
=•
-.^fficf' pursuant
that it violates paragraph Seventh of 12 U.S.C, 24,
r
t > th S ,* -in \iU Vr T hn^41061 ire queswhich relates, in part, to the purchase of corporate
r
1
r
r
t oncJ on ti'f rounds h ^ t cv ar^ >nt i y to the.
stock by National Banks. As in the case of other
irt' nt - f C( n r ess is e \ p ^ ^ec1 in the Jaw and do not
»
questions raised, this challenge as to the legality of this
appir^ h tl * r[ sfV->\iif
r d d d1? oi^ancd in the
ruling reflects a lack of understanding of the powers
FL If • i Rose \ e Boaid'^ i ^d T td' 1 1 7 Deposit Insurgranted and limitations contained in paragraph Seventh of 12 U.S.C. 24.
] li F v T> ind the F i ' J l p i+t( i nf d t1 eir reguThe activities normally carried on by a mortgage
lnti > s - cn r c!ose\ on tho 3 e x uoJ 'A th(s Securities service company have long been recognized as an es*
S
and F \ r ' in<* Coijimissic \ ith the iiiajo^ t xception
sential part of the business of banking in which a Naol ' i Iron i\ 1 y of t i r rc° incmcr^ 'or cert lied finan- tional Bank may lawfully engage under paragraph
Seventh of 12 U.S.C. 24. No one would argue that
%
>
^ oi * , >'
i ^ M h ^ V ilhaTiis Amend- a bank could not properly service mortgage loans it
v
ment, giving to t r e banking "^en^ies administration
makes itself. The servicing of such loans held by
of < c J i i ,1. n ir i^i •> jl tt e E ban A* \ct, as amended, others is a logical and economically sound extension of
to be tht't * t o inking asfc^cics °hoi !d id^pt their own
such activity. As previously stated, neither the proregul i ( T s I) s( d on ti ^ public m4 itst as determined
visions contained in that paragraph, nor their purpose
7
in the >n *S of th^ b j n \ ivz indu tn , while giving
or legislative history prohibit, or in any way limit, the
due re? ^c 1 t o the spen n reed of sba1 (holders of bank
judicially recognized right of a National Bank to ex11 D

h

Reqi revr >s




255

ercise all such powers as are incidental to the business
of banking, including the power to carry on certain
activities which are a part of the business of banking
through a subsidiary corporation. It has long been
settled law that for various business considerations, a
National Bank may carry on certain of its banking
activities such as mortgage servicing either directly or
through a subsidiary corporation.
13. Ownership and Operation of Travel Agencies
It is stated in paragraph 7475 of the Comptroller's
Manual that, incident to those powers vested in them
under 12 U.S.C. 24, National Banks may provide
travel services for their customers and receive compensation for such services. This ruling, as well as the
Comptroller's ruling relating to the authority of National Banks to acquire the stock of a travel agency
corporation and operate such a corporation are challenged on the ground that they are not provided by law
and that paragraph Seventh of 12 U.S.G. 24, which
relates to the purchase of corporate stock by a National
Bank, prohibits the purchase and operation of a travel
agency corporation.
As have previous Comptrollers, the present Comptroller has recognized that National Banks may, as an
incident of their banking powers, provide travel services for their customers and may receive compensation
for these services. Travel services may properly include the issuance of travel credit cards, the sale of trip
insurance and the rental of automobiles as agent for a
local rental service. As a legitimate exercise of their
banking powers, National Banks may advertise, develop and extend such travel services for the purpose of
attracting customers to the bank.
The provision of travel services is the natural and
necessary complement of long standing banking services such as the issuance of travelers' letters of credit
and travelers' checks, the making of loans to finance the
costs of travel, the provision of custody accounts and
safe deposit facilities and the entire range of bank
credits employed in international trade and investment.
As in the case of other activities which are either
a part of the business of banking or incidental thereto,
such as mortgage servicing activities, as discussed
above, a National Bank may, consistent with the provisions contained in paragraph Seventh of 12 U.S.C.
24, and in accordance with applicable judicial precedents, engage in such activities either indirectly
through a subsidiary corporation, the stock of which is
owned by the bank, or directly through a department
within the bank.
256




14. General Insurance Agency Activities
It is stated in paragraph 7100 of the Comptroller's
Manual that 12 U.S.C. 92 provides that National Banks
may act as agents for any fire, life, or other insurance
company in any place the population of which does not
exceed 5,000 inhabitants. This provision is applicable
to any office of a National Bank when the office is
located in a community having a population of less
than 5,000 even though the principal office of such
bank is located in a community whose population exceeds 5,000. This ruling is challenged on the grounds
that 12 U.S.C. 92 has been removed from the U.S.
Code of laws since 1916 and that this ruling is contrary to rulings of previous Comptrollers.
There is specific statutory authority in 12 U.S.C.
92 for a National Bank to act as a general insurance
agent in a community with a population of less than
5,000 people. The ruling contained in paragraph 7100
is consistent with the clear Congressional intent, evident
at the enactment of the statute. It is realized that
there is a disagreement among lawyers as to the technical status of 12 U.S.C. 92 as having the force of law.
It was for this reason that this provision of law was
cited as paragraph II of Section 13 of the Federal Reserve Act in paragraph 9405 of the Digest of Opinions
which predated paragraph 7100 of the Comptroller's
Manual. In this connection, it is gross error to assert
that this ruling is contrary to rulings of previous Comptrollers. The Comptroller's Office, along with the
other banking agencies and the banking industry generally, has always gone on the assumption that the provisions contained inl2U.S.C92 remain as part of the
law.
15. Insurance Activity Incidental to Banking Transactions
It is stated in paragraph 7110 of the Comptroller's
Manual that under the powers vested in them under
12 U.S.C. 24, National Banks have the authority to act
as agent in the issuance of insurance which is incidental
to banking transactions and that commissions received
therefrom or service charges imposed therefor may be
retained by the bank. This ruling is challenged on the
basis that it is not provided for by law and that it is
contrary to rulings by previous Comptrollers.
A National Bank, wherever located, may, pursuant
to its corporate powers contained in paragraph
Seventh of 12 U.S.C. 24, participate in insurance
transactions which are incident to banking transactions. An example would be a bank selling to a customer credit life insurance to pay the balance of a loan
held by the bank, in the event of the customer's death.

A National Bank has an insurable interest in an
automobile on the security of which it has extended
credit to a customer. A bank also has an interest in
maintaining through liability insurance the creditworthiness of its customer, so long as the loan is outstanding, in order that its ability to collect from the
customer is not impaired by judgments arising out of
the negligent operation or use of the automobile. The
bank's interest in the automobile and in the unimpaired
credit-worthiness of the customer, so long as the loan
is outstanding, can be protected by making insurance
available to the customer. It is unreasonable and entirely without justification to expect a bank to gratuitously supply this service for an insurance company
without receiving any payment for the necessary expenses which the bank incurs through the use of its
employees and facilities.
Congress has consistently recognized that the business of banking covers a wide range of activities. In
the National Bank Act of 1864 Congress wisely refused
to define the business of banking as it then existed,
foreseeing that the banking business would change
and develop with the passing years. It is clear that
the business of banking is advanced by financial and
related services, and powers necessary to achieve and
promote the fundamental purposes of banking must be
regarded as powers incidental to those expressly
granted by paragraph Seventh of 12 U.S.C. 24. Moreover, there is no evidence contained in the legislative
history of 12 U.S.C. 92 that Congress intended to prohibit National Banks from acting in the limited capacity as agents in the issuance of insurance which is incidential to banking transactions. With respect to
the position of previous Comptrollers who approved
of the bank doing the work of an agent so long as it
did not receive any compensation for it, it suffices to
say that the receipt of payment for a service does not
in itself make the service performed illegal or ultra
vires, but it is the character and nature of the service
itself which determines whether its performance is
consistent with the bank's corporate powers.
16. Debt Cancellation
It is stated in paragraph 7495 of the Comptroller's
Manual that a National Bank may provide for losses
arising from cancellation of outstanding loans upon
the death of borrowers. This ruling is challenged
on the basis that it is not provided for by law.
The Comptroller's Office has, in paragraph 7495,
simply recognized that, as a means of protecting itself
against losses from its lending transactions, a National
Bank may provide for losses arising from the cancellation of outstanding loans upon the death of borrowers.




The imposition of an additional charge, and the establishment of necessary reserves in order to enable the
bank to agree to such debt cancellation clauses, are
a lawful exercise of the powers of a National Bank
and necessary to the business of banking. This ruling
is founded on paragraph Seventh of 12 U.S.C. 24,
which authorizes a National Bank to exercise "all such
incidental powers as shall be necessary to carry on the
business of banking; . . . " The execution of loan
agreements with debt cancellation clauses pursuant to
section 24 is an exercise of a National Bank's corporate
powers precisely as in the case of its other banking
activities.
The debt cancellation ruling is not intended as a
means of enabling National Banks to invade the field
of insurance. Rather, it is a recognition of a National
Bank's right to protect itself against anticipated losses
in connection with its lending activities, through the
establishment and maintenance of appropriate reserves.
The necessity to maintain such reserves, and to adjust
charges in relation to the risk involved in a particular
transaction, has long been recognized as an essential
part of the prudent conduct of the banking business.
It has been contended that a debt cancellation
clause is an insurance contract which is subject to
regulation by state authorities because cancellation of
the debt upon the death of the borrower results in a
benefit to his estate and satisfaction of the debt is
provided for out of a reserve established by the bank.
This contention is without merit. No payment is made
to the borrower's estate. The reserve established by
the bank is for its benefit and sole protection. The
cancellation of the debt on the death of the borrower
is in no way dependent upon the size or, indeed, the
existence of a reserve created by the bank.
The establishment of a reserve by a National Bank
for its benefit is obviously not the business of insurance.
Whether such reserves have been established and are
adequate are, like other banking matters, subject to
the exclusive supervisory authority of the Office of
the Comptroller. The provisions of 15 U.S.C. 1012
are not to the contrary. Although section 1012 vests
in the several states certain authority in connection
with the business of insurance, Congress did not, by
Section 1012, confer on the states any authority over
the banking activities of National Banks. A banking
transaction by a National Bank does not become the
business of insurance subject to the provisions of section 1012 merely because a state official or legislature
defines the business of insurance so broadly as to
encompass banking transactions as well as the wide
variety of insurance which they purport to regulate.
257

17. Use of Data Processing Equipment
It is stated in paragraph 3500 of the Comptroller's
Manual that a National Bank may make available,
for the use of others, data processing equipment acquired for the primary purpose of performing service
incidental to banking. This ruling is challenged on
the grounds that it is not provided for by law, and
that it is contrary to the intent of Congress expressed
in the Bank Service Corporation Act (12 U.S.C.
1861-65) prohibiting any data processing activity
other than the performance of bank services for
banks.
The objections are groundless in light of the provisions contained in 12 U.S.C. 24 and 12 U.S.C.
1861-65. A National Bank may clearly own and
operate data processing equipment under 12 U.S.C.
24 which authorizes it to exercise all such incidental
powers as shall be necessary to carry on the business
of banking. It is fundamental that if a bank is to
achieve the full utilization of its investment in such
equipment, it must make it available for the use of
others even though it is acquired for the primary
purpose of performing services incidental to banking.
This conclusion is entirely consistent with and supported by the judicially recognized right of a National
Bank to lease or construct a building for banking
purposes even though, in order to achieve a maximum
return on its investment, it intends to occupy only a
part thereof and to rent out a large part of the building to others. The Bank Service Corporation Act
(12 U.S.C. 1861-65) recognizes the right of small
and medium-sized banks to organize and invest in
bank service corporations to provide service comparable to that offered by the largest banks. However,
nothing contained in either the act or its legislative
history precludes a bank from owning its own data
processing equipment or from sharing in the ownership of such equipment through a corporation owned
by it with individuals or with corporations other than
banks.
18. Leasing of Personal Property
It is stated in paragraph 3400 of the Comptroller's
Manual that a National Bank may become the owner
and lessor of personal property acquired, upon the
specific request, and for the use of a customer, and may
incur such additional obligations as may be incident
to becoming an owner and lessor of such property.
These transactions do not result in obligations subject
to the lending limits set forth in 12 U.S.C. 84. Since
lease payments are in the nature of rent rather than
258




interest, they are not subject to 12 U.S.C. 85 and 86.
This ruling is challenged on the grounds that it is not
provided for by law and contrary to the clear intent
and purpose of Congress contained in 12 U.S.C. 84.
The Comptroller's ruling which recognized the authority of National Banks to engage in the direct
leasing of personal property was the result of a reexamination of the statutory corporate powers of National Banks.
Paragraph Seventh of 12 U.S.C. 24 authorizes a National Bank to exercise "all such incidental powers as
shall be necessary to carry on the business of banking;
by discounting and negotiating * * * evidences of
debt; * * *." Prior to the Comptroller's ruling, a
lease financing transaction had been considered within
the authority of a National Bank only to the extent
that the transaction could be regarded as the discount
or the negotiation of an evidence of debt. It followed
that such transactions were subject to the lending
limits contained in 12 U.S.C. 84. Previous rulings
recognized that certain lease paper could be discounted
or negotiated and would qualify under exception 13
of 12 U.S.C. 84. Under some circumstances, the obligation of the discounter or negotiator of such paper
(ordinarily the lessor) is not subject to the lending
limit.
A careful study of lease financing indicated that
transactions in which the economic function of the
lessor had been reduced to a minimum were already
an important part of the business of banking. In
these transactions a bank lent money to a lessor solely
upon the credit of a lessee for the purchase of property specifically requested by the lessee for its immediate possession and use. The lessor acted solely as
a holder of title and as a nominal debtor. He was a
relatively expensive retailer of bank credit necessary
only because a lease transaction required an owner
and lessor of property, and because the bank supervisors required an evidence of debt. The recognition
that in some cases a lessee could be regarded as a
debtor under 12 U.S.C. 84 approached, but did not
reach the solution of the problem. A debtor-creditor
relationship did not meet the needs of the lessee.
Solution of the problem, however, required only the
recognition that the economic development of the
United States had brought this form of lease financing
into the business of banking. The business of banking, like the law merchant, continues to grow to meet
the needs of commerce. Paragraph Seventh of 12
U.S.C. 24 clearly authorizes National Banks to carry
on the business of banking, The "business of bank-

ing" clearly is not limited to the transactions described
in paragraph Seventh. It is not necessary to fit lease
financing into the narrow confines of the negotiation
of an evidence of debt. It is, in fact, necessary to the
business of banking to recognize that the leasing by the
bank of personal property acquired upon the specific
request of and for the use of its customer, and the incurring of such additional obligations as may be incident to becoming an owner of personal property and
the lessor thereof, is a lawful exercise of the powers of
a National Bank and necessary to the business of
banking.
The limitation contained in 12 U.S.C. 84 applies
specifically to the discounting, negotiation and guaranty of evidences of debt. If, as indicated in the preceding paragraphs, lease financing is not the negotiation of an evidence of debt for the purposes of 12
U.S.C. 24, there is no reason to regard it as such for
the purpose of bringing it within the limitation of 12
U.S.C. 84. Certainly, the acquisition of personal property is not within the limitation and the payment of
rent is ordinarily regarded as compensation for the
use of property and not as the payment of a debt.
19. Purchase or Sale of Securities Subject to Repurchase Agreements
It is stated in paragraph 1131 of the Comptroller's
Manual that the purchase or sale of securities by a
bank, under an agreement to resell or repurchase at
the end of a stated period, is not a borrowing subject
to 12 U.S.C. 82 or an obligation subject to the lending
limit of 12 U.S.C. 84. This ruling is challenged on
the basis of being contrary to the clear intent of
Congress contained in 12 U.S.C. 82 and 84, which impose borrowing and lending limitations, respectively,
on National Banks.
In form as well as legal effect, such transactions are
neither borrowings nor lendings but rather are purchases and sales. The only possible justification for
inclusion of such transactions within the lending
limitations is that, in isolated cases, they may be used
to evade the lending limit. However, the vast majority of purchases and sales are for valid and legitimate
nonborrowing purposes, such as the obtaining of collateral security for public deposits.
As stated, this ruling is entirely consistent with the
substance and realities of a legitimate part of the banking business. As a responsible regulator}' body, the
Comptroller's Office cannot because of possible isolated instances of evasion of applicable statutory limits
by a few bankers, view transactions as being applicable




to statutory limitations which, in fact and in law, are
not applicable.
20. Underwriting by National Banks
Under the provisions of paragraph Seventh of 12
U.S.C. 24, National Banks are empowered to underwrite and generally trade in those securities which constitute general obligations of a State or a political subdivision of a State. After a thorough study of the
issues, the Comptroller rules that a number of types of
municipal securities, hitherto thought to be ineligible
for underwriting and general trading by National
Banks, had sufficient elements of a "general obligation" to qualify them for such underwriting and trading. Further, in the first major revision since 1934,
the authority of National Banks to purchase investment securities was restated and reinterpreted in a new
Investment Securities Regulation which became effective on September 12, 1963.
This new Regulation for National Banks reflects the
Comptroller's effort, within his statutory authority, to
enable the banking system to perform more effectively,
yet safely, the vital function of faciliating the flow of
investment funds into their most productive uses. In
a private enterprise economy, this task of aiding the
mobility of capital is one of the most significant responsibilities of the banking system.
The regulation is challenged as being contrary to
paragraph Seventh of 12 U.S.C. 24, presumably because the Comptroller has concluded that a bond may
constitute a public security even though it is not supported by general powers of taxation possessed by the
obligor of the bond. The contention that in order for
bonds to constitute a general obligation of a State or
any political subdivision thereof, they must be issued by
a political unit possessing powers of general taxation
and must be supported by such powers is without merit.
Such a requirement clearly is not imposed by the provisions of paragraph Seventh of 12 U.S.C. 24. Similarly, neither the legislative history of those provisions
nor any relevant judicial decisions warrants the imposition of such a requirement. Bonds which are
adequately supported by substantial resources of a
political unit are eligible for bank underwriting and
there exists no statutory authority on the basis of
which the Comptroller's Office, in the exercise of its
regulatory and supervisory responsibility as required
by paragraph Seventh of 12 U.S.C. 24, could conclude
and therefore require as a condition precedent for
bonds being eligible for underwriting, that the political
unit issuing such bonds possess general powers of taxation and that the bonds must be supported by such
powers.
259

21. Definition of Executive Officer
It is stated in paragraph 5235 of the Comptroller's
Manual that the term "executive officer," within the
contemplation of 12 U.S.C. 375a, means each officer
of a bank who, by virtue of his position, has both voice
in the formulation of the policy of the bank and responsibility for the implementation of such policy.
The responsibility of and function performed by the
individual—not his title—determine whether he is an
"executive officer." This ruling is challenged on the
basis that it is contrary to that provision in 12 U.S.C.
375(a) expressly authorizing the Federal Reserve
Board to define the term "executive officer."
The Comptroller's Office has concluded that the
term "executive officer" as contemplated by 12 U.S.C.
375(a), means any officer of a bank who, by virtue of
his position, has both voice in the formulation of the
policy of the bank and responsibility for the implementation of that policy. To define executive officer in
any other terms would have the effect of depriving
many bank employees of the opportunity of obtaining
their home mortgage, automobile loan and other
normal borrowing needs from the bank for which they
work. Banking is perhaps unique in the large number
of employees who, for a variety of reasons, are executive officers in name only. A more restrictive definition serves only to deprive the bank of business from
its employees who cannot influence their own loan
applications.
Consequently, the Comptroller's Office has taken a
realistic approach to the situation. Its position is entirely consistent with the intent of 12 U.S.C. 375 (a)
which was designed to prevent individuals from influencing their own loan applications. It has retained
the protection contemplated by the statute by ruling
that anyone who can influence the lending policy of
the bank and also implement that lending policy is an
executive officer within the meaning of the statute.
The Federal Reserve Board, prior to the Comptroller's ruling on this subject, had not altered its Regulation in 25 years. Regulation O, as it appeared for
these 25 years, stated that the Chairman of the Board,
the President, every Vice President, the Cashier, Secretary, Treasurer and Trust Officer were Executive
Officers. Subsequent to the Comptroller's ruling the
Federal Reserve Board amended its Regulation O so
that, as amended, the statutory limitation on loans to
executive officers does not apply to a person, regardless
of his title, who has no authority to perform and
actually does not perform the duties of an executive.
260




22. Real Estate Loan Defined
It is stated in paragraph 2000(b) of the Comptroller's Manual that a real estate loan within the meaning
of 12 U.S.C. 371 is any loan secured by real estate
where the bank relies upon such real estate as the
primary security for the loan. Where the bank in its
judgment relies substantially upon other factors, such
as the general credit standing of the borrower, guaranties, or security other than real estate, the loan does
not constitute a real estate loan within the meaning of
12 U.S.C. 271, although as a matter of prudent banking practice it may also be secured by real estate. This
ruling and a similar ruling contained in paragraph
2400(c) of the Comptroller's Manual are challenged
on the alleged basis that they are contrary to a plain
reading of 12 U.S.C. 371 which defines and limits real
estate loans, and contrary to rulings by previous
Comptrollers.
Federal law (12 U.S.C. 371) requires that loans
made by National Banks on the security of real estate
meet certain requirements v/ith respect to the nature
and value of the security, the term of the loan and the
manner of its repayment. Section 371 states that "a
loan secured by real estate within the meaning of this
section shall be in the form of an obligation or obligations secured by a mortgage, trust deed, or other instrument upon real estate which shall constitute a first
lien * * *" The quoted language is obviously regulatory, not definitory. If it is a real estate loan, it must
meet certain standards, but the section leaves open
presumably for the discretion of the bank examiner, to
determine which loans are in fact real estate loans,
which must meet the minimum security and amortization requirements of the section.
Section 371 does not state that any loan made by a
bank in which a real estate security interest is taken,
is a real estate loan. Section 371 and other provisions
of Federal law expressly recognize that in certain
circumstances loans secured by real estate are not
made primarily on a security of real estate and are
to be treated as ordinary commercial loans. Real
estate loans have thus been, defined by the Comptroller's Office as not including those loans in which
the bank is primarily relying on factors other than real
estate. Where a bank is primarily relying on general
credit standing of the borrower, guaranties, or security
other than real estate the loan does not constitute a
real estate loan within the meaning of 12 U.S.C. 371,
although as a matter of prudent banking practice it
may also be secured by real estate.
In the past, a bank making a sound personal loan,
from a credit standpoint, was thought by many to be

unable to acquire a first or second lien on real estate
as additional security, because the loan, which was
never intended to be a real estate loan, could not
conform to the statutory requirements of Section 371.
A bank making a sound personal loan may wish to
have a real estate security interest merely as an additional source for paiyment of the loan in the event of a
default. The bank may not have any expectation of
ever resorting to this real estate security for repayment. To force the bank to regard every loan, having
any real estate collateral however incidental, as a
real estate loan subject to Section 371 would prevent
the bank from taking this additional security in the
case of a sound personal loan. Such a construction
obviously defeated the remedial purpose of the section
which was to require maximum protection for the
bank.
These rulings are not contrary to rulings of previous
Comptrollers, as is evidenced by paragraph 2145 from
the Digest of Opinions, which predated the Comptroller's Manual. It was stated in paragraph 2145
that "Occasionally it may be advisable for a bank to
take a mortgage on real estate in order to strengthen
the primary security for a loan and protect it against
some unfavorable contingency. For example, a loan
may be made * * * upon the security of an assignment of rents to be paid under a long-term lease with
an oil company * * * operating a gasoline station * * *. In such a case the bank might wish to
hold a mortgage on the realty itself, in order to increase the certainty of continued receipt of the rental
payments. Assuming that the lessee is financially
responsible and credit-worthy, the lease cannot be cancelled, the lease rental is adequate to service the loan
and pay the principal amount of the loan in full by its
such a loan would not be regarded
maturity,
as a 'real estate loan,' subject to the requirements of
section 24 [12 U.S.C. 371]."
23. Improved Real Estate
It is stated in Paragraph 2020(d) of the Comptroller's Manual that business and residential property is
improved when substantial and permanent improvements have been constructed or developed on the property, or when its value has been enhanced by such
improvements in its immediate vicinity. This ruling
is challenged on the ground that it is not provided
for by law and that it is contrary to rulings of previous
Comptrollers.
The definition of what constitutes improved real
estate is, and always has been the responsibility of the
Comptroller's Office. To object to a particular def-




inition as not being provided for by law is to merely
raise questions of opinion inasmuch as the term improved real estate is not defined in either the statute
(12 U.S.C. 371) which imposes certain limitations on
real estate loans by National Banks, or in any other
applicable Federal law.
Prior Comptrollers had held that real estate was
"improved" only when there was a completed structure
erected thereon. In recognition of economic realities,
the present Comptroller has ruled that real estate may
be considered "improved" within the meaning of 12
U.S.C. 371 when construction or development has contributed substantially to its value. The construction
of a building on the property is not the only, nor necessarily the greatest, "improvement" that can occur to
enhance the value of a particular piece of real estate.
This ruling merely recognizes the fact that many
changes may happen, both on and in the vicinity of
the real estate such as affords all the protection to the
lender that is contemplated by the statutory requirement that the real estate be improved. The paving
on a parking lot in the heart of Manhattan may be
more valuable as "improvement" than a two-story barn
on a dust-bowl farm.
Farmland is deemed "improved" when it is useful
for agricultural purposes without further substantial
improvement. So too, should business and residential
property be regarded as "improved" when substantial
and permanent improvements have been constructed
or developed on the property, or when its value has
been enhanced by such improvements in its immediate
vicinity. Of course, whether onsite or offsite improvements have enhanced the value of property, so as
to make it improved real estate, is necessarily a question of judgment which can only be resolved in the
light of the facts of each particular case.
24. Capital Debentures
It is stated in paragraph 1100(b) of the Comptroller's Manual that National Banks may issue capital debentures and capital notes which, to the extent
that they are subordinated to the prior payment in
full of all deposit liabilities, such debentures and notes
are includable in "capital" for the purposes of determining the loan limitation of 12 U.S.C. 84. This
ruling is challenged on the grounds that it is not provided for by law and is contrary to traditionally
accepted corporate and accounting practice.
Title 12 U.S.C. 84 provides that the total obligations to any national banking association of any person,
copartnership, association, or corporation shall at no
time exceed 10 per centum of the amount of the
261

capital stock of such association actually paid in and
unimpaired and 10 per centum of its unimpaired surplus fund.
Under the terms of this Office's ruling, the right to
receive payment of debenture holders must be expressly subordinated to the right to prior payment in
full of all deposit liabilities of the Bank, whether outstanding at the date the debentures are issued or
thereafter incurred. Capital notes or debentures so
limited have all of the protective effect of capital and
surplus insofar as depositors are involved.
An examination of the legislative history of the
National Bank Act, and relevant judicial decisions
subsequent to its enactment establishes the power of
National Banks to borrow money and issue debentures
in return therefor, the proceeds of which may be used
for general banking purposes. In addition, such an
examination of the lending restrictions contained in
12 U.S.C. 84 indicated that protection of depositors
is the primary purpose of restricting the amount of
loans to any person to a stated percentage of the
capital and surplus. Consequently, if capital debentures and notes stand legally in the same relationship
to depositor as "equity" capital and surplus, they may
appropriately be included in the bank's loan base.
We conclude, therefore, that the proceeds of capital
notes and capital debentures may be included as part
of the aggregate amount of unimpaired capital stock
and unimpaired surplus funds for the purpose of the
computation of the limit on loans to individual borrowers contained in 12 U.S.C. 84, provided appropriate subordination provisions are present.
25. Undivided Profits and Reserves as Included in
"Unimpaired Surplus Fund"
It is stated in paragraph 1100(c) of the Comptroller's Manual that a National Bank may include as part
of its "unimpaired surplus funds" [as used in 12
U.S.C. 84], all capital accounts (other than capital
stock) derived from paid-in or earned surplus, undivided profits, tax-paid portion of valuation reserves
for loans, valuation reserves for securities and reserves
for contingencies. This ruling is challenged on the
grounds that it is not provided by law and is in disregard of established bank accounting terms.
Our ruling relating to undivided profits and reserves
as includable in unimpaired surplus fund, and which
is set forth in paragraph 1100(c) of the Comptroller's
Manual for National Banks, was based on a study of
the legislative history underlying the limitations on
loans dependent upon capital and surplus as set forth
in 12 U.S.C. 84. Because the protection of deposits
262




was the primary purpose of these limitations the term
"unimpaired surplus," as used in the statute, has been
ruled to include all capital accounts which are not
subject to known charges and which are interchangeable simply by resolution of the bank's board of directors. Such accounts, as a practical matter, stand in
the same relative position to deposits as does the surplus account. Examples of such accounts would be
undivided profits, valuation reserve for securities and
reserve for contingencies. Reserves which are subject
to known specific charges, such as a reserve for dividends declared or a reserve for taxes, interest and
expenses, would not be includable in "surplus."
26. Interest Rates Charged by National Banks
It is stated in paragraph 7310 of the Comptroller's
Manual that a National Bank may charge interest
at the maximum rate permitted by applicable State
law to any competing State lending institution. Where
State law permits a higher rate on specified classes of
loans (for example, small loans), a National Bank
which makes loans at such higher rate is subject only
to such limitations relating to the classification of loans
as are material to the determination of a rate of
interest. This ruling is challenged as being contrary
to 12 U.S.C. 85 and contrary to a Federal court
decision.
As was stated in paragraph 9510 of the Digest of
Opinions,1 in enacting 12 U.S.C. 85 "Congress intended that, with respect to interest charges national
banks shall have the same powers as any competing
State lending institution. State commercial banks
and industrial banks both constitute competing elements among lending institutions. Therefore, national
banks are empowered to charge interest at the maximum rate permitted by State law to either State
commercial banks or industrial banks * * *."
Paragraph 7310, which is comparable to paragraph
9510 of the Digest of Opinions, is merely a restatement
of relevant court decisions (see, for example, Rockland National Bank of Boston v. Murphy, 110 N.E.
2d 638 (Mass. 1953)) and is entirely consistent with
the objectives of Congress beginning in 1863 and 1864,
as was clearly stated in the legislative history of section 85, as has been uniformly recognized by previous
Comptrollers, and as is reflected in applicable court
decisions. To contend now, in 1965, that National
Banks are not free to compete with any competing
1
The publication of the Comptroller's Office which preceded and which was replaced by the present Comptroller's

Manual for National Banks.

State lending institution is to ignore this clear Congressional intent and thus to argue that National
Banks are required to operate and compete in a dual
banking system under conditions more restrictive and
less favorable than those applicable to State-chartered
institutions.
27. Messenger Service by National Banks
It is stated in paragraph 7490 of the Comptroller's
Manual that, in order to meet the requirements of its
customers, a National Bank may provide messenger
service by means of an armored car or otherwise,,
pursuant to an agreement wherein it is specified that
the messenger is the agent of the customer rather than
of the bank. Deposits collected under this arrangement are not considered as having been received by
the bank until they are actually delivered to the teller
at the bank's premises. Similarly, a check is considered as having been paid at the bank when the money
is handed to the messenger as agent for the customer.
This ruling is challenged on the grounds that it violates
the state branch banking restrictions incorporated into
12 U.S.C. 36c and that to the extent it involves interstate branching, it is not provided for by law and
violates the clear intent of Congress.
Rulings of the Comptroller's Office dating back to
1929 have held that the pickup of deposits and the
delivery of cash by armored car service is authorized,
provided that certain safeguards are met to insure
that such activities do not constitute unauthorized
branch banking. The ruling in the Comptroller's
Manual merely reaffirms this traditional view that such
service is a proper incident of the business of banking
as authorized under paragraph Seventh of 12 U.S.C.
24. Section 36(f) of Title 12. U.S.C, defines a
branch b n k a*- an1 place t \ h u h d i>ocits ->re ret t i \ o ' ov hei ks T j ! or noncv h nt Tbi >, t has
b r>n
c 1 *hc t ti >rt i f v hich provide aunored
t ar - ( i\ ice i n st n<\1 o it ck <ir that the lunds a u being
>
i c n i (v x> the i iio AI C 'MCI a*.
it feu the custo '
" " t \x c be
V»antlM rut c r this iul ing.
i 1
^ c . 1. ' i t ' ' \ if ' '1 r ' ^
* iVorb
the f
of the ser i e JA 1 h u v U tl, ninerls do not
(ons 1L i { th> T D Tv_nt ui interest m viol ition of
Re^iJ? on Q

Th'1 Federal Deposit Insurance Goiporation and the
Board of Governors of the Federal Reserve System
have issued substantially the same rulings applicable to
state banks under their jurisdiction.
28. Authority to Act as "Finder"
It is stated in paragraph 7200 of the Comptroller's
Manual that a National Bank, pursuant to request, may




act as "finder" in bringing together a buyer and seller,
where the bank's activity is limited to the introduction
and it takes no further part in the negotiations for this
service, the bank may accept a fee. This ruling is
challenged on the grounds that it is not provided for by
law and that it permits National Banks to engage in
activities of a nonbanking nature and to compete unfairly with other businesses.
Commercial transactions, which necessarily entail
the coming together of a buyer and seller, most frequently require the financing and related financial
services afforded by commercial banks. Where a bank
is able to bring together a buyer and seller, it is performing a service both to prospective participants in a
commercial transaction and to itself as the possible
source of financing such a transaction. In such circumstances, the bank is, as authorized under 12 U.S.C.
24, engaged in the business of banking and exercising
a power which is necessary to carry on the business of
banking.
It must be noted that paragraph 7200 contemplates
that the bank's activity be limited to an introduction
and that the bank take no part in the negotiations.
National Banks, in places where the population does
not exceed 5,000, may act as real estate brokers generally. In larger towns, National Banks with trust
powers may manage and sell real estate for customers. See Comptroller's Manual, paragraph 7425.
This ruling relates to when a National Bank may act
as an agent for a buyer or seller of loans and may engage in the management and sale of real estate for
others. Assertions to the contrary notwithstanding, a
careful analysis of all cases bearing on this question
clearly indicates that the Comptroller's ruling is entirely consistent with judicial precedent.
29. Loans Secured by Bank Shares
It is stated in paragraph 6030(b) of the Comptroller's Manual that a National Bank may require that a
borrower holding shares of the bank execute agreements (1) not to pledge such shares, (2) to pledge
such shares at the request of the bank when necessary
to prevent loss, and (3) to leave such shares in the
bank's custody. This ruling is challenged on the
grounds that it violates an express prohibition contained in 12 U.S.C. 83 that a National Bank may not
make any loan or discount on the security of the shares
of its own capital stock, unless such security shall be
necessary to prevent loss upon a debt previously contracted in good faith.
As stated in 12 U.S.C. 83, a National Bank may accept the security of its own stock only when such
263

security is necessary to prevent a loss on a debt previously contracted. The ruling contained in paragraph 6030(b) is entirely consistent with this limitation of 12 U.S.C. 83 inasmuch as none of the transactions described in that ruling constitute a pledge of
bank stock as security. On the contrary, each or a
combination of the agreements described in paragraph
6030(b) are merely means by which a National Bank
may insure that bank stock owned by a borrower will
be available as security in the event that loss on an
existing loan appears likely. The provision of 12
U.S.C. 83 which permits a National Bank to accept

264




the security of its own shares when such security is
necessary to prevent loss on a debt previously contracted
would be stripped of any meaning and purpose by an
interpretation that the bank could not prudently prevent a prior hypothecation or sale of the borrower's
assets to the extent that such assets consisted of bank
shares. Such an interpreation by a banking supervisor
would be irresponsible and subject to criticism. A
bank should, in the exercise of prudent banking judgment, be left free of any restraints whatsoever in its
ability to reach all assets of a borrower to prevent a
loss to the bank.

APPENDIX D

Selected Correspondence
of
JAMES J. SAXON
Comptroller of the Currency




INDEX
Selected Correspondence of James J. Saxon, Comptroller of the Currency
Subject

Armored Car Service
Availability of Information
Bank Mergers
Banking Premises
Brokered Deposits
Certificates of Deposit
Coin Shortage
Confidentiality of Reports of Examination
Corporate Practices and Procedures
Credit Bureau
Debt Cancellation Contracts

266




Page

267
267
269
299
299
300
301
301
302
316
316

Subject

Direct Leasing
Disclosure Requirements
Insurance Function
International Operations
Key Man Insurance
Lending Limits
New Bank Charters
Real Estate Loans
Travel Services
Trust Regulations
Underwriting

Page

317
318
319
322
325
326
327
327
328
329
330

ARMORED CAR SERVICE

AVAILABILITY OF INFORMATION
MARCH 19, 1965.

MAY 6, 1965.
Hon. JOHN J. RHODES

House of Representatives
Washington, D.C.
This is in response to your inquiry of April 22, 1965,
in which you enclosed correspondence from the Armored Motor Service of Arizona, Inc., in Phoenix,
Ariz., signed by its president, Mr. S. B. Thomson.
Mr. Thomson, who mentions a ruling by this Office
applicable to national banks, states that the practice
of picking up deposits for customers to be delivered to
banks and the handling of money between banks has
always been handled by privately owned armored car
companies. He is of the view that this is a private
enterprise which should not be in competition with
the Federal Government in any of its branches.
A national bank is a privately owned commercial
bank or financial institution and any services performed by it may not reasonably be construed as the
activities of a branch of the Federal Government. A
national bank's character as a private rather than governmental enterprise is not altered because it is chartered, supervised and examined by this Office, or
because Federal law imposes certain restrictions and
limitations on its activities.
Rulings of this Office dating back to 1929 have held
that the pickup of deposits and the delivery of each by
armored car service is authorized, provided that certain safeguards are met to insure that such activities do
not constitute unauthorized branch banking. We
have reaffirmed the opinion that such sendee is a
proper incident of the business of banking.
Section 36(f) of Title 12 U.S.C. defines a branch
bank as any place at which deposits are received, or
checks paid, or money lent. Thus, we have ruled that
agreements to provide armored car service must make
it clear that the funds are being received by the armored carrier as agent for the customer and not the
bank. As an element of this ruling, we have also held
that a National Bank may absorb the cost of the service, and that such payments do not constitute the
payment of interest in violation of regulation Q.
The Federal Deposit Insurance Corporation and
the Board of Governors of the Federal Reserve System
have issued substantially the same rulings applicable
to state banks under their jurisdiction.




Hon. JOHN E. MOSS,

Chairman, Foreign Operations and Government
Information Subcommittee of the Committee on
Government Operations
House of Representatives
Washington, D.C.
Your letter of February 12, 1965, addressed to the
Secretary of the Treasury, asks a number of questions
concerning the availability of information from Treasury agencies and the extent to which such availability
is responsive to the requirements of the Administrative
Procedure Act of 1946. This letter responds to such
questions insofar as they relate to the Comptroller of
the Currency.
1. In general, section 3 of the Administrative Procedure
Act of 1946 (5 U.S.C 1002) applies to the Comptroller of
the Currency.
2a. Descriptions of the central and field organization of
the Office of the Comptroller of the Currency are published
in the Federal Register and in letters to all National Banks
from time to time as changes are made. They are also published annually in the "United States Government Organization Manual" and in the "Annual Report of the Comptroller
of the Currency." This information is also published by
various commercial publications. The Comptroller's regulations "Procedures" (12 CFR 4) and "Fiduciary Powers of
National Banks and Collective Funds" (12 CFR 9), which
set forth the places and methods whereby the public may
secure information or makes submittals or requests, are published in the Federal Register, in the Code of Federal Regulations, in letters to all National Banks and in the Regulations
sections of the "Comptroller's Manual for National Banks"
and the "Comptroller's Manual for Representatives in
Trusts."
b. Statements of the general course and method by which
the functions of the Comptroller are channeled and determined, including the nature and requirements of all formal
and informal procedures, forms, and instructions as to the
scope and content of all papers, reports, or examinations are
also set forth in the regulations, "Procedures" and "Fiduciary
Powers of National Banks and Collective Funds." Additional detailed information on these subjects is contained in
the "Manual for Representatives in Trusts," "Comptroller's
Policy Guidelines for National Bank Directors" and "Instructions, Procedures, Forms for National Bank Examiners." The
first of these manuals is furnished to representatives in trusts
and to national banks authorized to exercise fiduciary powers.
The other two manuals are furnished to national bank directors and national bank examiners for their guidance. All
three are loose leaf manuals which are supplemented from
time to time.

267

c. Substantive rules adopted as authorized by law are published as regulations in the Federal Register and in the Code
of Federal Regulations (12 GFR 1-20), in letters to all national banks and in the Regulations sections of the Manuals
for National Banks and for Representatives in Trusts.
d. Statements of general policy and interpretation formulated and adopted for the guidance of the public are published as interpretative regulations in the Federal Register,
in the Code of Federal Regulations (12 GFR 1.105 et seq.;
12 CFR 7), in letters to all National Banks and in the Regulations sections of the Manuals for National Banks and for
Representatives in Trusts. Interpretative rulings arising out
of individual inquiries from national banks have been generalized for the guidance of officials of national banks and
their counsel, national bank examiners and other members
of the staff of the Comptroller of the Currency and are published in the Rulings section of the "Manual for National
Banks" or in the Opinions section of the "Manual for Representatives in Trusts." Individual rulings which are particularly timely are distributed immediately in letters to all National Banks. Significant rulings are also summarized quarterly in "The National Banking Review." In addition to the
sections on Rulings and Regulations, the "Manual for National Banks," which is supplemented at quarterly intervals,
includes the text of the National Banking Laws and related
statutes. The "Manual for Representatives in Trusts" also
includes the text of the laws relating to the trust powers
of National Banks and instructions, procedures and forms.
"The National Banking Review," a journal of policy and
practice published quarterly by the Comptroller, provides a
forum for the discussion of economic problems relating to
banking. Members of the Comptroller's Economics Staff
and others interested in these problems contribute leading
articles to the Review. Current statistical data and comment on economic, legal and regulatory developments are
regularly published in "The National Banking Review."
e. Rules addressed to and served upon named persons in
accordance with law are specifically excepted from publication requirements of section 3 of the Administrative Procedure Act (5 U.S.C. 1002(a)(3)). Such rules are, in accordance with published rule (12 CFR 4.13(a) (2)),
available for public inspection except in such cases as the
Comptroller determines (section 4.13 (b)) that disclosure
would conflict with the public interest and the proper administration of his responsibilities.
3. The Comptroller of the Currency is required by 12
U.S.C. 1828(c) to include in his annual report to the Congress the basis for his approval of each merger, consolidation,
acquisition of assets, or assumption of liabilities approved
by him during the period covered by the report. Opinions
in such cases are published in the "Annual Report of the
Comptroller." They are also released to the press through
regular public information channels at the time the action is
taken. Other rulings, final opinions, decisions, and orders of
the Comptroller of the Currency are available for inspection
at the Office of the Comptroller during business hours to persons properly and directly concerned in accordance with the
provisions of the procedural regulation of the Comptroller
(12 CFR4.13).
4. Section 4.13(b) of the procedural regulation of the
Comptroller defines confidential information, lists reasons
for its non-disclosure and sets forth the circumstances in

268




which disclosure may be authorized by law and in the public
interest. Opinions, decisions, and orders of the Comptroller
are included (section 4.13 (b) (2) (iii)) within the definition
of confidential information when the Comptroller determines
that disclosure would conflict with the principles set forth as
reasons for nondisclosure in section 4.13(b) (1).
The Comptroller publishes biweekly a "Summary of Actions" which sets forth the disposition made of applications
for charter, for a branch, for a title change, for a head office
relocation or a branch relocation. The "Summary of Actions"
is distributed to all national banks, to approximately 2,500
business firms, lawyers and other interested individuals who
have requested to be notified of decisions. It is also released
to the Washington press through public information channels and mailed to approximately 150 out-of-town newspapers and publications. In addition, a public information officer responds to press Inquiries concerning the filing
and disposition of applications for new bank charters, branches
and mergers.
5. Unpublished opinions and orders are not cited or used
as precedents in other proceedings.
6. Interpretations and legal opinions are published in the
form of regulations in the Federal Register and the Code of
Federal Regulations. Such regulations and more detailed
interpretations and rulings are published for the benefit of the
persons directly concerned with the National Banking System
in letters to all national banks and in the various Comptroller's
Manuals. Unpublished information, except that required
for good cause to be held confidential is, in accordance with
published rule (12 CFR 4.13(a)(2)), available for inspection at the Office of the Comptroller of the Currency during
business hours to persons properly and directly concerned.
The rule provides that a request to examine such information
or to obtain a copy or copies thereof must be submitted to
the Comptroller of the Currency or to the Regional Controller of the Currency for the: region in which the request
arises. Such request must be signed by the person making
it or his duly authorized agent who must state the name
and address of the person on whose behalf the request
is made. The request must set forth the facts, if any, involved, the purpose for which the document or information
contained therein will be used if made available, the nature
of such person's interest in the matter and the reason or
reasons why the reqeust should be granted (12 CFR 4.13(a)
(2)(ii)).
7. Many of the records and files of the Office of the
Comptroller of the Currency contain information which must
be safeguarded in the public interest in order to protect the
National Banking System and to enable the Comptroller to
administer properly his responsibilities. Such information
is disclosed only to such persons and to the extent that the
Comptroller determines that disclosure is authorized by law
and is in the public interest (12 CFR 4.13, 4.14). National
bank examiners are forbidden by 18 U.S.C. 1906 to disclose
the names of borrowers or the collateral for loans of banks
examined by them to other than proper officers of such
bank without first having obtained the express permission
in writing from the Comptroller of the Currency.
8. Private parties dealing with the Comptroller of the
Currency are not required to resort to organization or procedure not published in the Federal Register.

9. The Comptroller of the Currency does not disclose
records, files and other information where such disclosure
would conflict with the public interest in the proper administration of his responsibilities as the supervisor of National
Banks. Some of the results which might flow from the
improper disclosure of such information are set forth in
section 4.13(b) (1) of the procedural regulation of the
Comptroller. The nature of the information which is ordinarily not disclosed is set forth in section 4.13(b) (2). These
considerations, however, do not require the Comptroller to
refrain from the publication of rules.
10. Rules relating solely to internal agency management
are ordinarily not published.
11. The Comptroller of the Currency does not define
"official record" as used in section 3(c) of the Administrative Procedure Act. The standards set forth in the Comptroller's regulation relating to the disclosure or nondisclosure
of information (12 CFR 4.13) does not depend on whether
the information is a matter of official record or not.
12. In accordance with your request, there are submitted
herewith two copies of—
Years of Reform, a Prelude to Congress—The 101st Annual
Report of the Comptroller.
The Comptroller's Manual for National Banks.
The Comptroller's Manual for Representatives in Trusts.
The Comptroller's Policy Guidelines for National Bank
Directors.
Instructions, Procedures and Forms for National Bank
Examiners.
The March issue of The National Banking Review.
Pages 104 and 105 of the United States Organization Manual, 1964-65.
Notice of New Regional Organization, 27 Federal Register,
4530 and 4531, Friday, May 11, 1962.
Summary of Actions.
A sample merger opinion.

BANK MERGERS
APRIL 26,1965.
Hon. DANTE FASCELL

House of Representatives
Washington, B.C.
Reference is made to your letter of April 5, 1965,
wherein you express your concern with the grave
problems which can arise in bank merger cases, where
the stamp of approval has been affixed by a banking
agency, only to have it destroyed at some future time
through the efforts of another agency of the Government, the Antitrust Division.
These problems are new to the banking industry
and have only arisen since the passage of the Bank
Merger Act of 1960. While the legislative history
of that Act had been understood by the banking fraternity as making it clear that the role of the Depart-




ment of Justice in bank mergers was to be advisory
only, the Supreme Court, in United States v. Philadelphia National Bank 374 U.S. 321, ruled that bank
mergers were within the reach of the antitrust statutes.
This, in effect, as Mr. Justice Harlan indicated in his
dissenting opinion, gives the Department of Justice
veto power over bank mergers which have been approved by the federal banking agencies.
Since this problem of conflicting jurisdiction over
bank mergers arose from a statutory interpretation,
it appears to me that the solution to the problem lies
primarily within the Congress.

JANUARY 12, 1965.
Hon. JOSEPH CLARK,

United States Senate
Washington, B.C.
In your letter of January 6, 1965, you ask for a
status report on the application of Williamsport National Bank, Williamsport, Pa., to consolidate with
the First National Bank of Williamsport, Williamsport, Pa.
The application has been investigated by our field
examiner and the advisory reports required by the
Bank Merger Act of 1960 (12 U.S.C. 1828c) have
been received from the appropriate agencies including the Department of Justice, a copy of whose report
is enclosed for your information. The participant
banks have been given a copy of this advisory report.
Williamsport National Bank has a total IPC deposits of $22 million and the First National Bank of Williamsport has total IPC deposits of $17 million. These
small banks are second and third in size, respectively, in
the greater Williamsport-Ly coming County area. It
is estimated that the city of Williamsport has a population of 32,000, the greater Williamsport area 75,000,
and Lycoming County 110,000. Presently, there are
14 banks in the county with total deposits of some
$139 million.
While the economy of Williamsport and Lycoming
County is not stagnant, I am sure that you will agree
that it could well use a stimulant to further, more
rapid and sustained economic development. We believe that sound, well-managed banks of a size capable
of attracting and financing new industry and commerce are indispensable to promoting community
growth. While these small banks in Williamsport
have done well, we feel they could do much more for
the economic development of their area of Pennsyl269

vania were they given the opportunity to combine their
resources and channel their efforts in this direction.
We do not agree with the conclusions reached by
the Department of Justice in its advisory report on
the consolidation of the Williamsport banks. The
consolidation will, we believe, serve to bring new competitive vigor to the banking structure of the area and
will not, as the Department of Justice contends, have
an adverse effect upon banking competition.
The report of the Department of Justice has special
significance because of the authority of the Department to institute judicial proceedings under the Sherman and Clayton Antitrust Acts against consolidating
banks. The impact of an antitrust suit on any bank
is grave; the impact on small banks, as in Williamsport, could be disastrous. Realizing this, we cannot,
with regard for our responsibilities under the National
Banking Act, plunge National Banks applying for permission to consolidate into the bog of an antitrust
suit without first advising them of the possible and
probable consequences.
An antitrust suit against the Williamsport bank
would affect their operations in several respects. Because of their relatively modest resources and limited
earning capacity, they could not prudently undertake
to pay the heavy legal fees and court costs of antitrust
litigation. These small banks, struggling as they are
to improve the economic well-being of Lycoming
County and its residents, can ill afford the confusion
in their daily operations which an antitrust suit would
certainly create. An antitrust suit brought against
them in the name of the United States could seriously damage the banks' name and public image which
they have earned by many years service and which
they cherish as essential to their continued sucessful
operation. Further, if they were able to consolidate
before a court decreed their union illegal, their problems would be compounded as they attempted to work
their way through the labyrinth of a bank divestiture
proceeding. While this Office believes that this proposed consolidation would be in the public interest,
we have doubts, stemming from the above considerations, that these small Williamsport banks should
shoulder the risks of an antitrust suit no matter how
beneficial their proposed consolidation may be for the
economic betterment of Lycoming County and the
banking structure of Pennsylvania.
I shall, of course, be available to discuss this matter
further with you at your convenience should you desire more information.
270




DECISION OF THE OFFICE OF THE COMPTROLLER OF
THE CURRENCY ON THE APPLICATION TO CONSOLIDATE WILLIAMSPORT NATIONAL BANK, WILLIAMSPORT,, PA., AND THE FIRST NATIONAL BANK OF
WILLIAMSPORT, WILLIAMSPORT, PA.
STATEMENT

On October 16, 1964, the $34.2 million Williamsport National Bank, Williamsport, Pa., and the $22.2
million First National Bank of Williamsport, Williamsport, Pa., applied to the Comptroller of the Currency
for permission to consolidate under the charter of the
former and with the title "Williamsport First National
Bank."
Williamsport, with a population of 42,000, is located
in northeast central Pennsylvania along the West
Branch of the Susquehanna River, 85 miles north of
Harrisburg. Williamsport is the focal point of a surrounding area denominated locally as Greater Williamsport, which has a population of 74,755, and is the
county seat of the largest county in area in Pennsylvania, Lycoming County, which has a population of
109,367. No other town in the county approaches
Williamsport in size and, in fact, it is the only city of its
size for a distance of some 65 miles in any direction.
A municipal airport with scheduled flights, railways,
and road transportation give easy access to and from
Williamsport. The area will benefit from federal highway projects now under construction, particularly
from the Keystone Shortway (Interstate 80), which
will ultimately extend from New York to San Francisco
via Chicago and will pass near Williamsport.
The economy of the Williamsport area is based principally on industry and agriculture, with recreational
facilities in the outlying areas near the river and education also providing some stimulus. At the turn of
the century, Williamsport was known as the largest
lumber city in the world but the depletion of the
nearby forests forced the city to turn to more diversified industry. Now there are 207 industrial establishments operating in Lycoming County and manufacturing such varied products as airplane engines, radio
tubes, steel, and paper napkins. The Williamsport
Technical Institute, a division of the Williamsport
Area Joint Schools, has substantially contributed to
the development of a skilled labor force to attract
industry by training and retraining adults and high
school seniors to work in modern plants. There are
1,490 farms, averaging 140 acres per farm, in the
county which are principally devoted to truck farming and dairying. Also contributing to the county's

economy is Lycoming College, with 1,260 students.
The economic prospects for the Williamsport area are
promising because of the success of local efforts to
attract diverse industries and to provide necessary
educational opportunities. In addition, the national
program of providing first-rate highway facilities to
all parts of the country should greatly advance the
prospects for Williamsport because some of these highways will link that city to the east and west coasts.
The applicant banks are located in the center of
Williamsport and each has one branch. The major
competitor in the city is the $42.8 million Northern
Central Bank & Trust Co., the resulting bank of a
merger in 1963 which made it the dominant bank in
Williamsport. Two smaller banks in the Greater Williamsport area have resources of some $19.8 million.
Nine other banks in Lycoming County, ranging in
size from the $7.5 million Muncy Bank & Trust Co.,
Muncy, to the $1.4 million First National Bank of
Ralston, Ralston, also compete with the applicant
banks. In addition, three savings and loan associations
in Williamsport compete for saving's accounts and
mortgage loans.
This proliferation of banking units in Lycoming
County reflects the extent of competition which the
applicant banks encounter in the area they serve.
While most of the banks in the county are small, they
nevertheless provide alternate banking sources for individuals, farmers and small businessmen who make
up a large portion of the local banking customers.
The need in Williamsport is for a bank which can
offer effective competition to the now dominant Northern Central Bank and can attract new industry and
commerce which will stimulate the local economy.
Moreover, the larger industries and commercial establishments in Williamsport require larger loans and
more services, such as Lock Box Service, than either
applicant bank can provide at the present time. First
National Bank, for example, must send documents
daily to a larger bank 200 miles distant for data processing in order to offer its customers efficient demand
deposit accounting and, in a few instances, payroll
accounting. Alone, neither bank can justify the acquisition of electronic data processing equipment; as a
consolidated bank, they could invest in this equipment
and thus offer modern banking services in an efficient
manner.
Size and equipment are only as effective as the men
who use them, however. Both applicant banks have
been fortunate in the quality of management in the
past and at the present time. But the problem in both




banks of management succession and of competition
with other banks for specialists in such fields as trusts
and commercial lending can no longer be ignored.
Having considered the statutory criteria of the effect of the transaction on competition, the convenience
and needs of the community and the management,
we would be inclined to hold that the proposed merger
is in the public interest. The indication of the Department of Justice in its agency report to this Office that
litigation to enjoin the proposed consolidation is likely,
casts a different light on the transaction. We must
consider, pursuant to the Bank Merger Act of 1960,
the future earnings prospects of the applicant banks.
The resources and earning capacity of these banks do
not permit them prudently to sustain the heavy legal
fees and court costs of protracted antitrust litigation.
The effect of such burdensome expenses on future
earnings could be seriously detrimental.
There is also the responsibility, entrusted to this
Office by the Congress, of supervising national banks
to insure their solvency and liquidity. We intend to
carry out our mandate with regard to this application.
Besides the oppressive costs involved in defending an
antitrust suit, the confusion in daily operations and
the damage to the banks' name and public image which
they have earned by many years service could have a
grave impact on the condition of these national banks.
Further, if they were able to consolidate before a court
decreed their union illegal, their problems would be
compounded as they attempted to work their way
through the labyrinth of a bank divestiture proceeding.
As the applicant banks are effectively blocked by the
threat of litigation from improving and making more
rational their operations by means of the proposed
consolidation, it is reasonable to anticipate their joining forces with banks outside the Lycoming County
area in the near future. This type of union would
offer many of the advantages of the proposed consolidation, such as bringing in new personnel and increasing funds to serve the growing Williamsport economy
and insuring that it does indeed grow. Hopefully,
such a union would allow the banks to develop naturally as regional banks, capable of giving the Williamsport area public the banking service, it deserves,
without threat of litigation and without harassment.
Having considered the consolidation application in
the light of the relevant facts and our statutory mandate, we are compelled to deny permission to
consolidate.
APRIL 21,

1965.

271

Hon. WRIGHT PATMAN

Chairman, Committee on Banking and Currency
House of Representatives
Washington, D.C.
AUGUST 24,

1965.

The Office of the Comptroller of the Currency appreciates the opportunity to present its views on S.
1698, which passed the Senate and was referred to
the Committee on June 14, 1965. Secretary Fowler
has authorized me to submit to you and the members
of the Committee the following statement of the views
of this Office, which I have, of course, discussed with
him. However, this statement does not necessarily
in all respects represent the views of the U.S. Treasury.
Public policy toward bank mergers has been in a
chaotic state since the Supreme Court's Philadelphia
decision in 1963. There, although a majority of the
Court agreed that the Bank Merger Act of 1960 remained in full force and effect, they held that bank
mergers are also subject to section 7 of the Clayton
Act. These two positions are fundamentally irreconcilable. Whereas the Bank Merger Act requires the
bank regulatory agencies to weigh the public interest
in bank merger proposals according to seven criteria
carefully tailored by Congress to fit the realities of
banking, the Clayton Act applies a narrow competitive
test initially fashioned for the unregulated industries
where competition serves as virtually the sole safeguard
of the consumer interest.
The Philadelphia decision did nothing to provide
definitive guidelines for the banking industry and its
supervisory authorities for the reconciliation of these
diverse criteria. The chaos in bank mergers was further heightened by the Lexington decision which ruled
that a violation of section 1 of the Sherman Act when
applied to bank mergers is to be determined by the
same tests to be applied in a section 7 case. In effect,
therefore, sections 1 and 7 are made interchangeable
with respect to bank mergers.
With the banking agencies and the Department of
Justice applying statutes having conflicting criteria, it
is small wonder that the ensuing clashes have befuddled the public and aroused the banking industry.
The banking committees of both houses are to be
commended for their current efforts to resolve the
statutory conflict.
In my view, the considerations which led the Congress in 1960 to enact the Bank Merger Act, with its
recognition of the need for merger criteria specifically
designed to fit the unique industry of banking, are still
compelling today. Those considerations make it preeminently clear that the traditional criteria of the
272




antitrust statutes developed in connection with mergers in the unregulated industries cannot be fittingly
applied to bank mergers. In the unregulated industries mergers may be freely undertaken, subject only
to prosecution under the antitrust laws. In banking,
however, mergers require the prior administrative approval of a regulatory authority, and the regulatory
agencies in reaching their decisions apply a variety of
statutory criteria relating to the banking and public
consequences of proposed mergers.
The desire to merge is critically affected by the
power to branch. Merger applications rarely appear
in no-branch States because a merger under those
conditions usually requires the closing of one of the
merged banks. Thus, two tools of structure control
are effectively lost where branching is prohibited, and
needed bank expansion must take place almost entirely
through new charters.
The public benefits which may be derived from
mergers stem basically from the economies of largescale enterprise, and the greater variety of services
which larger firms may offer to consumers. These
benefits will arise where increases in the scale of operations yield savings in costs, or where a broadening in
the lines of production or the extension of operations
to new markets permit greater dispersion of risks and
thus allow the undertaking of ventures unsuitable for
smaller firms. A larger and more broadly based bank
may also be able to offer specialized services which are
not profitable for smaller institutions, and should be
able to move capital more efficiently from surplus to
deficit areas. Moreover, the legal lending limits of
banks require the presence of larger institutions to
meet the needs of larger businesses most proficiently.
In our public policy for the unregulated industries,
we have generally distinguished between the growth
of firms through internal expansion and their growth
through merger. Growth through merger has been
viewed with greater public concern because it entails
the elimination of competitors and, for this reason,
merger limitations have been imposed through the
antitrust laws. The direct administrative controls
applied to bank mergers are also based in part upon
the competitive effects of such mergers, but, as we
shall see, the banking authorities apply a variety of
other public interest criteria in deciding bank merger
cases. These criteria are specifically related to the
fact that the banking structure is under direct public
control.
There is some probability that growth through
merger may have a more adverse effect on the liveliness of competition than growth through internal ex-

pansion. However, there are countervailing considerations. A merger may enable a firm to acquire plant,
personnel, and market-access not otherwise readily
attainable, or attainable only at greater cost. More
fundamentally, even though the intensity of competition may be adversely affected by growth through
merger, merger may nevertheless produce benefits of
larger-scale production which are in some degree
passed on to consumers in the form of improved service
or lower prices. The task of public policy is to allow
those increases in the size of firms that are, on the
whole, beneficial to consumers, while restricting those
that are, on balance, harmful.
There are two reasons why merger may often be the
preferred course of expansion in banking, even though
in comparable circumstances reliance on internal
growth may be more appropriate for the unregulated
industries.
First, the banking authorities have a positive responsibility to see that the public convenience and need
for banking services and facilities are met. In carrying out this responsibility, they do not have the authority to require the provision of service such as is found
in the fully regulated industries like the "public utilities"; their choices are limited to the private proposals
for bank expansion presented for their approval. If
they find that a proposed merger will yield public
benefits and they see no superior means for achieving
these benefits either at hand or in clear prospect, they
have a strong positive reason for approving the merger.
In the unregulated industries, there is no public responsibility to fashion industry expansion according
to the public need; reliance is placed on private initiative and no public authority faces the problem of
choosing the form or method of industry growth.
Second, in choosing the best means to serve the
public convenience and need for banking services, the
banking authorities must appraise the alternatives in
terms of the effects on the solvency and liquidity of
competing banks. Bank merger proposals are generally designed to provide new services to a community,
to provide services at lower cost, or to enter new
markets. The alternative means of achieving these
purposes are new charters and de novo branching.
If the existing banks in a market are poorly managed,
financially weak, or unpregressive, such added competition may threaten their solvency or liquidity and
merger may constitute the only effective means of
bringing improved service to a community without
posing a threat to bank viability.
In the unregulated industries, there is no public
concern to safeguard individual firms against failure.




Indeed, in these industries freedom to compete and
to eliminate less efficient rivals is essential to the reliance placed on private initiative to serve consumer demands. It is therefore appropriate in the freely competitive industries to impose more severe restrictions
on growth through merger than are applied to banking.
Bank mergers have sometimes been opposed on the
ground that, although they may improve service for
some classes of consumers, they may do so at the expense of others. Some classes of consumers, however,
have needs which only larger banks can serve efficiently. If other classes of consumers are disadvantaged
by a merger, a new opportunity is presented to competing banks and the banking authorities may respond
by authorizing new charters or new branches. In this
way, the needs of all classes of bank customers may be
served most efficiently and most effectively.
The Bank Merger Act of 1960 provided for direct
administrative control of bank mergers by the banking
authorities, and established broad public interest standards to guide the administration of these controls. In
addition to the "effect of the transaction on competition
(including any tendency toward monopoly)," the
banking agencies are required to consider the financial
history and condition of each of the banks involved,
the adequacy of their capital structures, their future
earnings prospects, the general character of their management and, most significantly, "the convenience and
needs of the community to be served." Mergers are
to be approved only where, after considering all of these
factors, the transaction is found to be "in the public
interest." Since the passage of the Bank Merger Act,
however, two Supreme Court decisions have subjected
bank mergers to the antitrust laws. This has given
rise to ambiguities of policy and conflicts of purpose.
The problems are both philosophic and procedural.
There is no serious dispute about the desirability of
applying antitrust principles to the unregulated industries. Since in those industries primary reliance is
placed on individual initiative and private enterprise
to meet consumer demands, there are justifiable reasons for preserving freedom of entry and restricting the
acquisition of market power in order to enable the
competitive forces to function. In banking, however,
entry and expansion are under direct public control.
The competitive forces are purposefully restricted in
order to safeguard the viability of the banking system,
and an effort to apply conventional antitrust principles
in these circumstances is almost certain to conflict with
bank regulatory objectives.
This is well demonstrated by the difficulties that have
been encountered under the Bank Merger Act since the
273

Philadelphia and Lexington decisions brought bank
mergers under the antitrust laws. Although the banking agencies must continue to reach their decisions according to the broader public interest standards set
forth in the Bank Merger Act, their decisions are now
subject to attack in the courts under the narrower
standards of the antitrust laws.
This impasse can be clearly resolved only by exempting bank mergers from the antitrust laws completely
as has been done in other regulated industries,, or by
subjecting such mergers to the full application of those
laws. If this latter course is chosen, the Bank Merger
Act should be repealed. There would seem to be no
valid reason for subjecting banks to more onerous premerger requirements than apply in the unregulated
industries if bank mergers are to be subject to attack
under the antitrust laws. More fundamentally, if it
is to be public policy to apply conventional antitrust
concepts to banking, it logically follows that bank entry
and bank branching should also be free of direct public
control. The least satisfactory course is the present
one of entrusting regulatory powers to the banking
agencies and judging the exercise of those powers on
the assumption that the competitive forces are to be
fully preserved and fully operative. It should be observed, however, that a decision to move toward free
bank entry and expansion raises questions which go
beyond the problems of banking structure. It is highly
doubtful that bank operating practices could be effectively supervised, and the viability of the banking system sustained, without some form of public control over
the banking structure.
There is one intermediate course through which a
reconciliation might be achieved between the Bank
Merger Act and the antitrust laws with or without a
statutory change. The courts, in antitrust cases involving bank mergers, could take cognizance of the fact
that banking competition is restricted through public
regulation, and that bank mergers receive prior administrative approval from a public authority according to
broad public interest standards which transcend purely
competitive considerations. A statutory provision embodying these standards would produce greater consistency between the Sherman and Clayton Acts and
the Bank Merger Act of 1960 in bank merger cases.
In fact, this new direction to the courts could be made
applicable to the pending cases in which bank mergers
are being challenged.
This approach would not be as clear cut as the other
alternatives we have presented, and would undoubtedly
leave large areas of uncertainty for long periods.
Nevertheless, if in bank merger cases the courts con274




sidered the unique competitive conditions which prevail in the regulated industry of banking, there would
be a greater likelihood that the antitrust criteria developed principally with the unregulated industries in
mind could be adapted to banking without impairing
the effectiveness of bank regulation.
An effort to test this approach for accommodating
these two basic strands of our public policy was recently
undertaken by the Comptroller of the Currency as an
intervening defendant in an antitrust action relating
to the merger of the Mercantile Trust Co. N.A. and
the Security Trust Co., both of St. Louis. (A copy
of the pleadings filed in the St. Louis case is enclosed.)
There is one administrative procedure under the
Bank Merger Act which should be modified if that act
is to remain in force. At present, the banking agencies
not directly involved in a merger decision are required
to submit advisory opinions on the "competitive factor" to the responsible agency. Since this factor comprises only one of the seven considerations required
to be taken into account, the advisory opinions do not
represent a judgment on the desirability of a merger.
Nevertheless, differences between the advisory opinions
and the decisions on mergers have often been falsely
cited as evidence of differences in merger policy among
the banking agencies. Moreover, 5 years of experience
under the Bank Merger Act have demonstrated that
the advisoiy opinions of the banking agencies not faced
with the responsibility of decision are ordinarily routine
and rarely present facts or ideas unknown to the responsible agency. There seems to be no proper reason for continuing this procedure.
Retention of the Department of Justice advisory
opinions raises other considerations, however. Under
the terms of the Bank Merger Act, the Department of
Justice receives copies of the comprehensive merger
applications filed by the banks. These applications
are replete with detailed economic data, often of a confidential nature. They yield data tantamount to that
which Justice, in a merger case in an unregulated industry, would attempt to secure by investigation and
pretrial discovery. This procedure has the incongruous effect (especially in view of congressional failure
to approve general prernerger notification legislation
sought by the Antitrust Division) of making it easier
for the Department of Justice to attack a Governmentapproved merger in the bank industry than any other
merger, either in a regulated or an unregulated
industry.
The merger application form not only compels disclosure of material facts in sufficient detail to enable
Justice to institute a suit without further investigation,

but also compels the banks to admit to conclusions
of law which, on trial of a case, forecloses them from
raising their best defense. T h e critical issues in every
antitrust case filed against a bank is the definition of
the rck^pn' ma ket . w i the Jii c of common, e. It us
obwo < uuil the biO£u.Vr the i \ ' ant narLet and the
s
2 l1 ic d'^ %1 SL- the lines "> (.'iii.-i-"- •' in any s/kci merger
-{
situation, the less signXu^nt v ill L" the anticompetitive
i i r i ' i n (^ that meig( r. bliifv ;hcse a:e trie critical
i .sue i *v ' et' vi:/ir"*c' h< : * u; in an anfilrir-t suit,
>
it is ii',: ' n! i.nJait i > the La A1 ;<ppl\in*T ior a n e r ^ i
<
(
!)• \ a.-/ s: !.y ^ of > denial f^r aue pux^ss to a;mpc !
„
tlu'ii t > id,/ ; ;•> a dc.sn tii-n (f a u v ^ c U t i . p ' L ' t ,
the
<>m\iph ^ U*nilv.iy from \»hicL ~*~> ;J I 'it "'IP''. (' »i's :, >:c der'u jd--w!'ich does not a« rcid with
the e > . r.>l, i.1 l;'"'.s of aicj.'opcratu), s ' I ' * Philc< (\r\phla .uM Lc\inoto>' c J>C>. '.,t!i tlxv i ivJiiiKO on
S t i ' j '»i lrHi bulking b \ \ s v.cl i l ic L>.'. ,r ' r , (,i:venifia'."1 , n «;ir \'l depes'+o} s. /cl nothin i to cli-i'V t)\n
moT.i.1'1 \ .>. :cl^\ m - .a:k°i i i hanki-^
iin'' ,' ->-. v. u:»t wo IILJ\{ s i i x f'letOiOie, it : obvious
t.i ,t. • ' vr > "•' ,v, S 16 ^
*
'
ie - ijjc">11 id^al. Xone{.I'o1.*" . -. o < "MV)ii tho I .il ••'tv " «e ii is a step in die
:
r<rht (Hi >rt- p p*o idi'v-" a (ons<ructhe. albeit temryc: ti\. v l i: on u* ilv i .voti^ pi obi*11 s of the bank
mcis^ci, \\"e the'ofrre ^rc \i\ lc-crmu^ "ifl that this
subcoiiiinitt"^ i t \ o r a i ! v coneiclor S. 1 GOG.
If, ho ( v . U s L ^ M - - t V iur.nni-t of *h- Committee th.'t the exemptions and prot<< lions provided
in S. 1 698 >li mid noL be adopts.cl we wc^sid \i^orously
ur're i V v' )PTr 1 't o c to amend the appropriate statutes
to ie |i !,, i"ic t "nil» tri> corridor CJ1 ol the Ci/cria set
foith ir «h" P.-nk IM^rirn / • t in 'ud';in'; tl.t' legality
of a Vink r>i : .;rr. ^ach a ;t it^tory piovisici iei|uir\rrjr i]\c fd' _s t i roT.jki'-r a'l <K tli^se tiitoiia v*ould,
ir. " I T o;i;ii c:i, deadly tone! to p'ocluc^ moro consistem » I M V C , i. il,e SliiTH1, n ..nd Cla\if:i Acts on the

one V- ;. ,r:d the b.^k Me->rr Act of P50 on the
cthei' I MI i. m tl1 >vo ca-.es wlier'* tht1 /nntrM'-t division
r'-.'^Viyj. I or « LaJle v.y<- m the -oui'.s tno judgment
of f l:^ .'\Cxi.-apt i"<", L O I \ i-.^cnev in appioxing a
nvrgcr. Cu' h a m \ / dir^rLi'^n to the iouit«, as here
rec ••., me >n i1, c.'ii'd <ira sl^vci.i be made applicable
in
v
well. %'> ,iii\ others i k ' i ma h" htigau-d in ihi 1-iture.
IIKICC1' . svf'i a sLat H n y :1 Iaction would do much
to cl'irl'Kit t'ie i haos, t. ntiovor>y and cc nfusion

that nc-.. c:.Is»ts between the b~.nl: regulatory agencies
on the one hand and the Department of Justice on the
other, because the courts are not now required to consider the criteria as set forth by the Congress of the
United States in the Bank Merger Act of 1960. Un-




less this is done, we have little hope of any reasonable
clarification and guidance in administering the Bank
Merger Act.
United States District Court, Eastern District
of Missouri
Civil Action No. 65C-241O)
UNITED STATES OF AMERICA, PLAINTIFF, V.
MERCANTILE TRUST COMPANY, NATIONAL ASSOCIATION AND SECURITY TRUST COMPANY, DEFENDANTS

Filed: July 7, 1965
MOTION OF COMPTROLLER OF THE CURRENCY JAMES J .
SAXON TO INTERVENE AS A DEFENDANT PURSUANT TO
RULE 2 4, FEDERAL RULES OF CIVIL PROCEDURE

The Comptroller of the Currency, James J. Saxon,
pursuant to rule 24, Federal Rules of Civil Procedure,
hereby moves this Court for leave to intervene as a
defendant in this action, and to file the proposed answer
attached hereto and made a part hereof, on the following grounds:
1. The alleged representation by plaintiff, United
States of America, of the interest of the Comptroller of
the Currency James J. Saxon is or may be inadequate
and the said Comptroller of the Currency James J.
Saxon will or may be bound by a judgment in this
action, pursuant to rule 24(a) (2), Federal Rules of
Civil Procedure.
2. Defendants, as part of their defense, rely on approval of the merger in issue by the Comptroller of the
Currency James J. Saxon on August 4, 1964, pursuant
to rule 24(b) (2), Federal Rules of Civil Procedure.
Grounds (1) and (2) as set forth above are further
established in the Points and Authorities in Support of
Motion attached hereto and made a part hereof.
July 8, 1965
By JAMES J. SAXON, Comptroller of the Currency.

United States District Court
Eastern District of Missouri
Civil Action No. 65C-241 (1)
UNITED STATES OF AMERICA, PLAINTIFF

v.
MERCANTILE TRUST COMPANY, NATIONAL ASSOCIATION AND SECURITY TRUST COMPANY, DEFENDANTS

Filed: July 8} 1965
STATEMENT OF POINTS AND AUTHORITIES IN SUPPORT
OF MOTION BY COMPTROLLER OF THE CURRENCY
JAMES J. SAXON TO INTERVENE AS DEFENDANT.

Introduction
The subject cause, is instituted by the Department
of Justice, in the name of the United States, to prevent
275

the merger of the defendant banks, which merger was
approved by the United States acting through its
Comptroller of the Currency James J. Saxon. The
gravamen of the subject cause is that the proposed
merger of defendant banks, approved by the United
States through the Comptroller of the Currency, will
be illegal under section 1 of the Sherman Act (15
U.S.C. 1) and section 7 of the Clayton Act (15 U.S.C.
18).
The proposed merger of the defendant banks was
approved by the Comptroller of the Currency James
J. Saxon in a written statement dated June 24, 1965,
after consideration by said Comptroller of the several
statutory criteria required to be taken into account and
pursuant to the authority vested in said Comptroller
by the National Banking Act (12 U.S.C. 215a) and
the Bank Merger Act of 1960 (12 U.S.C. 1828(c)).
The action and authority of Comptroller of the Currency James J. Saxon in approving the merger,
pursuant to the statutory authority vested in said
Comptroller to approved mergers of national banking
associations, will be nullified if the judgment demanded
by the plaintiff is granted.
Intervention of Right
Rule 24(a) of the Federal Rules of Civil Procedure provides, in part, as follows:
(a) Upon timely application anyone shall be permitted to
intervene in an action: * * * (2) when the representation
of the applicant's interest by existing parties is or may be
inadequate and the applicant is or may be bound by a judgment in the action. * * *.

If the plaintiff is successful in the subject cause, the
action and authority of the Comptroller of the Currency James J. Saxon in approving the merger in
question, pursuant to the statutory authority vested in
the Comptroller by the National Banking Act (12
U.S.C. 215a), and the Bank Merger Act of 1960 (12
U.S.C. 1828(c)), will be nullified. Because of the
responsibilities imposed upon the Comptroller of the
Currency by the National Bank Act (12 U.S.C. 1, et
seq.) and related statutes in a merger approved by
him is a continuing one and not an interest that ceases
upon approval of the merger. The factors which the
Comptroller is required to consider when passing upon
a merger application are couched in language which
contemplates the future welfare and operation of the
bank resulting from the merger. For example, by the
statute the Comptroller is required to consider, among
other factors, the bank's "future earnings prospects"
and "the general character of its management." (See
276




12 U.S.C. 1828(c).) After the merger is approved,
the Comptroller's interest continues undiminished.
Resulting national bank is subject to the supervision
of the Comptroller of the Currency. Any action
against such national bank, particularly this lawsuit
which is predicated upon action of the Comptroller,
a result of which may adversely affect the welfare of
the participant national bank and the resulting national bank, affects the interest of the Comptroller of
the Currency.
Moreover, in desiring to have sustained the merger
approved by him, the interest of the Comptroller of
the Currency therein transcends his interest in protecting the welfare of the national bank resulting from
the merger. Among the several statutory factors required to be taken into account by the Comptroller in
passing upon a proposed merger, the Comptroller must
determine that it will serve the convenience and needs
of the community. Having determined that, among
other things, a proposed merger will benefit the public
interest, the Comptroller has an interest on behalf of
the public, and indeed a duty to the public, to encourage completion of the merger and to bend his efforts
to remove obstacles thereto.
The interest of the Comptroller of the Currency
James J. Saxon in protecting the public interest of
the United States, as entrusted to him by the Bank
Merger Act of 1960, and involved in the subject
cause, cannot be adequately represented by any other
existing party.
The plaintiff cannot adequately represent the Comptroller's interest because the gravamen of its complaint
is to prevent a merger which the Comptroller, after
due consideration, has approved. The interest of the
plaintiff in this case is not that of the United States,
but only the interest of the United Sates as viewed by
one agency thereof, namely the Department of Justice,
particularly the Antitrust Division thereof. The
Comptroller of the Currency, another agency of the
United States is also charged with representing the
public interest of the United States, and the Comptroller has a different position as to where lies the
public interest of the United States with respect to the
subject case. The Comptroller of the Currency is
equally entitled to represent the interest of the United
States which, by statute, is entrusted to him. Because
of the contradictory positions taken by the plaintiff
under antitrust laws and the Comptroller under the
banking laws, it is impossible for the plaintiff to represent the interest of the Comptroller of the Currency
in this case.

The interest of Comptroller of the Currency James
J. Saxon in the subject case cannot be adequately represented by defendant banks. Although defendant
banks are ably represented by capable counsel, such
counsel does not possess the expertise of the Comptroller and his staff concerning the subtleties of a bank
merger application. Years of experience with mergers
involving national and other banks of all sizes have
afforded the Comptroller a sphere of knowledge with
respect to bank mergers much greater than any other
nonbanking governmental officer or private citizen.
It is further pointed out that under 12 U.S.C. 215a
and 1828(c), that Comptroller of the Currency James
J. Saxon took into account several factors, including
the competitive effects, in deciding to approve the
merger of defendant banks. The relative weight accorded to each such factor was within the judgment of
Comptroller of the Currency James J. Saxon. The
defendant banks were not privy to the deliberations of
the Comptroller of the Currency and, therefore, they
are not in a position to know the relative importance
attached to the various factors taken into account by
him. Consequently, the defendant banks are not in a
position to represent Comptroller of the Currency
James J. Saxon in the subject action.
Permissive Intervention
Rule 24(b) ( 2 ) , providing of permissive intervention, provides, in part, as follows:
When a party to an action relies for grounds of claim or
defense upon any statute or executive order administered by
a Federal or State governmental officer or agency or upon
any regulation, order requirement, or agreement issued or
made pursuant to the statute or executive order, the officer
or agency upon timely application may be permitted to intervene in the action.

The Comptroller of the Currency also has a right to
intervene in this cause under rule 24 (b) of the Federal Civil Procedure. The Comptroller of the Currency is vested with exclusive authority under 12
U.S.C. 215a to approve or deny the merger of two or
more banks where the resulting bank is a national
association. His authority is augmented by the Bank
Merger Act of 1960 (12 U.S.C. 1828(c)), which instructs him to consider seven factors, including the
competitive impact of the merger, in determining
whether or not the merger will promote the public's
interest. Since the defendant banks in this suit rely
upon the validity of the Comptroller's order approving
this merger as a defense to the claims of the plaintiff,
it is proper that the Comptroller be permitted to
intervene.




The Comptroller's approval is at the very basis of
the action, in fact, such approval is a proximate cause
of such action. It is difficult to conceive how the
Comptroller's approval would not be considered to be
an essential ground in testing the legality of the merger.
The resolution of the issues here presented requires
the court to consider the spirit of rule I, Federal Rules
of Civil Procedure, which provides that rule 24 "shall
be construed to secure the just * * * determination"
of this action.
In United States v. El Paso Natural Gas Company
et al, 376 U.S. 651, (1964), Mr. Justice Harlan, in
his opinion, concurring in part and dissenting in part,
said:
This case affords another example of the unsatisfactoriness
of the existing bifurcated system of antitrust and other regulation in various fields. In this case, the Federal Power
Commission had indicated its approval of this merger as
being in the public interest. The Department of Justice,
however, considered the merger to be violative of the antitrust laws and, for that reason alone, against the public
interest. This Court, under the present scheme of things
has no choice on this record but to sustain the position
of the Department of Justice, as indeed it has felt constrained to do, albeit in my view with less justification, in
other recent cases involving dual regulation. Cf. UnitedStates v. Philadelphia National Bank, 374 U.S. 321; United
States v. First National Bank and Trust Co., decided today,
* * *, and my dissenting opinions in those cases. It
would be unrealistic not to recognize that this state of
affairs has the effect of placing the Department of Justice
in the driver's seat even though Congress has lodged primary
regulatory authority elsewhere.
It does seem to me that the time has come when this
duplicative and, I venture to say, anachronistic system of dual
regulation should be reexamined.

This Court has not had the benefit of an amicus
brief from the Federal Power Commission.
Similar thinking motivated Chief Justice Chase in
The Steamer Grey Jacket v. United States, 5 Wall.
370, 72 U.S. 370, to permit counsel for the Treasury
Department to present his argument because "the
Court is desirous of all the light that can be derived
from the fullest discussion."
The Court in Fahey v. O'Melveny & Myers, 200 F.
2d 420 (9th Cir. 1952), cert. den. 345 U.S. 952 (1953),
had an analogous problem before it when it was called
upon to decide whether or not the presence of the
Home Loan Bank Board and its members were indispensable to the lawsuit. The Court speaking through
Judge Bone, at pages 452-453, stated:
* * * the presence of the Home Loan Bank Board and its
members is required in this action. The relief requested
requires the redivision of the present Eleventh District into

277

two districts for there can be one and only one bank to a district. It requires the reactivation of the Los Angeles Bank
* * * None of these requirements or any other essentials to
the granting of the relief prayed for in the Los Angeles Action
is possible without action by the Board since under section 12
of the act, no bank may exercise any functions vested in it by
the act except "subject to the approval of the board." To us
it is obvious that the decree of the court which was capable of
granting the relief which the appellees and Los Angeles seek
would ncessarily have to require the Board "to take action
* * * by exercising * * * a power lodged in it." Williams
v. Fanning, supra, 332 U.S. at page 493 * * *; Daggs v.
Klein, supra. Certainly no mere subordinate bank which
was itself subject to the jurisdiction of the Board has the
power or authority which must be exercised to effectuate such
a decree. [Emphasis supplied.]

Plaintiff's counsel argued in the case of United States
of America v. Third National Bank in Nashville and
Nashville Bank and Trust Company (D.C.M.D., Tenn.
(National Division), Civil Action No. 3849) and in
the case of United States v. Crocker-Anglo National
Bank et al. (N.D. Southern Division, Civil Action No.
41808) that because the actions were brought in the
name of the United States, he as counsel for the United
States necessarily represented the Comptroller of the
Currency who is an officer of the United States. Such
argument, however, ignores the fact that the position
of the United States is not in every case an indivisible
one, but that different officers of the United States may
have divergent interests in the same case. E.g., Jackson, Receiver v. United States, 20 Ct. Cl. 298 (1885).
The Supreme Court, in Securities and Exchange
Commission v. United States Realty and Improvement
Co., 310 U.S. 434 (1940), was faced with an analogous
situation. In holding that an order allowing the permissive intervention of the SEC in a chapter XI bankruptcy proceeding was not an abuse of the district
court's discretion, the Court stated at page 460:
* * * we think it plain that the Commission has a sufficient interest in the maintenance of its statutory authority and
the performance of its public duties to entitle it through intervention to prevent reorganizations, which should rightly be
subjected to its scrutiny, from proceeding without it.

Executive Order No. 6166
Executive Order No. 6166 of June 10, 1933, upon
which plaintiff relied in the Third National Bank in
Nashville and Crocker-Anglo cases and is expected to
rely herein, provides in salient part in section 5 thereof
as follows:
The functions of prosecuting in the courts of the United
States claims and demands by, and offenses against, the

278




Government of the United States and of defending claims
and demands against the Government, and of supervising the
work of United States attorneys, marshals, and clerks in connection therewith, now exercised by any agency or officer,
are transferred to the Department of Justice.
As to any case referred to the Department of Justice for
prosecution or defense in the courts, the function of decision
whether and in what manner to prosecute, or to defend, or
to compromise, or to appeal, or to abandon prosecution or
defense, now exercised by any agency or officer, is transferred
to the Department of Justice.
For the exercise of such of his functions as are not transferred to the Department of Justice by the foregoing two
paragraphs, the Solicitor of the Treasury is transferred from
the Department of Justice to the Treasury Department.
Nothing in this section shall be construed to affect the
function of any agency or officer with respect to cases at any
stage prior to reference to the Department of Justice for
prosecution or defense.

This order encompasses two classes of cases: (1)
Claims and demands by, and offenses against, the
Government of the United States, including defense
of claims and demands against the Government, and
(2) cases referred to the Department of Justice by other
Federal Agencies for prosecution or defense in the
courts.
It is not questioned thai: the Department of Justice,
through its antitrust division, may institute suits in the
courts of the United States, in the name of the United
States, for alleged violation of the Federal antitrust
laws. It is questioned, however, whether the Department of Justice, has the authority under this executive
order to represent the Comptroller of the Currency in
cases where the Department is, in effect, attacking a
decision of the Comptroller of the Currency approving
the merger of two banks under the charter of a national
association by virtue of the authority vested in him by
Congress in the National Banking Act (12 U.S.C.
215a) and the Bank Merger Act of 1960 (12 U.S.C.
1828(c)).
The fourth paragraph of section 5 of the executive
order makes it clear that the Department of Justice is
not to interfere with or affect the functions of any
agency prior to referral of the case to the Department.
This bank merger has never been referred to the Department of Justice by the Comptroller of the Currency.
The Department's only function, under the Bank
Merger Act, is to render an advisory report on the competitive effects of any merger proposal. Yet the Department, by claiming to represent the Comptroller
under this executive order, and opposing the Comptroller's right to defend his decision on all the salient

factors, competitive and banking alike, as a party defendant, while, in substance, asserting the illegality of
the Comptroller's act, is in effect intruding itself into
the substantive operations and functions of the Comptroller's Office entrusted to him by Congress.

United States District Court, Eastern District of
Missouri, Eastern Division

Representation of Comptroller by
Counsel of his Choice

MERCANTILE TRUST COMPANY
NATIONAL ASSOCIATION AND
SECURITY TRUST COMPANY, DEFENDANTS

Plaintiff's counsel may represent to the court that
the Comptroller of the Currency had no legal right
to employ counsel other than the Department of Justice to represent him in the subject case.
Upon authority of 5 U.S.C. 49 which reads:
Employment of attorneys or counsel. No head of a department shall employ attorneys or counsel at the expense of
the United States; but when in need of counsel or advice shall
call upon the Department of Justice, the officers of which
shall attend to the same. [Italics supplied.]

The key words in the above subject are "at the expense
of the United States."
It is submitted that the Comptroller of the Currency James J. Saxon, is not subject to the prohibition
of the above-quoted statute by reason of the provisions
of 12 U.S.C. 481 which provides in salient part as
follows:
* * * the employment and compensation of examiners, chief
examiners, reviewing examiners, assistant examiners, and the
other employees of the Office of the Comptroller of the Currency whose compensation is and shall be paid from assessments on banks or affiliates thereof shall be without regard to
the provisions of other laws applicable to officers or employees
of the United States. The funds derived from such assessments * * * shall not be construed to be Government funds
or appropriated mo