Full text of Central Western Banker : August 1933, Volume 28, No. 8

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Federal Reserve Bank of St. Louis

CENTRAL WESTERN

BANKER
Omaha
T h e Commercial Department
As the Savings Manager Sees It
Page 5

Deposit Guarantee
Page 7

T h e Greatest Asset
Of Y o u r Savings Department
Page 9

Public Relations—
A Harder
But M ore Important Job
Page 10

August

1933


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Federal Reserve Bank of St. Louis

BUILT ON
F IN A N C IA L
STA BILITY
Financial stability of any financial insti­
tution is the most important factor during
the period of e co n o m ic u n ce rta in ty
through which this nation has
been passing.
The financial stability of our bank has
been an assurance to those with whom we
do business that the trust they have placed
in this bank is well reposed.

This con­

fidence is expressed in the fact that many
have dealt with us for twenty, thirty, and
forty years — some for
fifty years.

When you are in Omaha, please
make our bank your Omaha
headquarters.

RSTNational
BANK OF OMAHA

3

Central Western Banker, August, 1933


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Federal Reserve Bank of St. Louis

C ontinental Illinois
NATIONAL BANK AND
TRUST COMPANY
OF C H IC AG O

Statement o f Condition, Ju n e 30, 1933
RESOURCES

Cash and Due from Banks .
United States Government Securities .
Other Bonds and Securities .
Loans and Discounts
.
.
.
.
Stock in Federal Reserve Bank
Customers’ Liability on Acceptances .
Other Banks’ Liability on Bills Purchased
Interest Accrued but Not Collected .
Bank Building .
.
.
.
.
.
Other Resources
.
.
.
.
.

$189,409,366.71
128,413,856.24
69,788,954.88
343,028,965.79
3,000,000.00
11,071,804.83
280,116.15
2,080,319.45
14,550,000.00

6i 9,4 I4 -32
$762,242,798.37

LIABILITIES

Capital Stock .
.
.
.
.
.
Surplus
.
.
.
.
.
.
Undivided Profits
.
.
.
.
.
Reserve for Contingencies
Reserve for Taxes and Interest
Deposits
.
.
.
.
.
.
Acceptances
.
.
.
.
.
Other Banks’ Bills Endorsed and Sold
Discount Collected but Not Earned
Other Liabilities .
.
.
.
.

$ 75,000,000.00
25,000,000.00
1,600,717.16
5,000,000.00
10,042,172.37
632,819,314.92
11,286,234.71
280,116.15
594,828.74
619,414.32
$762,242,798.37

9"

C

IM F «I

The capital stock o f the Continental Illinois Company, held in trust for the
stockholders o f the Continental Illinois National Bank and Trust Company of Chicago,
is not included in the above figures.

Central Western Banker, August, 1933

4

CE N TRA L W TXTERN EAN RER
410 A R TH U R BUILDING
OMAHA
C l iff o r d D e P u y , Publisher

R. W. M oo rh ead , Associate Publisher

H. H. H a y n e s , Editor

F r a n k S. L e w is , 218 Essex Bldg., Minneapolis

Subscription, 25 cents per copy; $2.00 per year.

V o l u m e 28

II. E. O ’ C o n n o r , Field Representative

F r a n k P. S y m s , Vice-President, 19 West 44th Street, New York

Entered as second-class matter at the Omaha postoffice.

A U G U S T , 1933

N um ber 8

The Teller Tells the W orld
B y C. W . F I S H B A U G H
« n p H E B A N K IN G A C T O F 1933” is now passed,
and bankers are waiting for its interpretation. There
are a number of things we hope fo r : one is wiping
out of the old system of paying interest on public funds.
Here in Iowa the interest we pay for keeping books for pub­
lic accounts amounts to a very sizable amount each year.
If we can't get interest from our bank balances, why should
we pay interest on public accounts? Another account that
eats into our interest paid out is postal savings. W ith guar­
anteed bank deposits there is no need of the postal savings, so
it should be abolished. These, of course, are little flurries
that must be ironed out in this bill, and we hope for the best.
St St &
Q F

GUARANTEED

BANK

D E P O S IT S ,

1 am, of

course, very skeptical. W h en one looks over a list of
states that have tried the guarantee system and noticed the
results, it makes one skeptical. Take for instance the state
of Washington. A single bank failure wrecked their guar­
anty plan. It cost member banks $825,000 and left depos­
itors with unpaid warrants of about $1,400,000 when the
plan was discarded. W e hope that Federal Guarantee will
be more successful.
S St S
j y j v , M Y , it isn’t even safe for bank bandits now to go
A without liability insurance. Gus W inkler, reputed bank
robber, is being sued for $50,000 by one of the victims in
a bank robbery W inkler reputedly took part in. T h e cashier
of the Plano State Bank (111.) which was robbed in D e ­
cember, 1930, filed suit, claiming he was struck over the
head and seriously injured during the robbery. 4 hat brings
up the remark: “ Crime has to pay.”

< ^ A M B O H A D F O U N D A J O B for the week on a rail­
road section gang, and was taking leave of his family
when his dusky wife came to the door and shouted: “ Come
back here, Sam, you hasn’t cut a stick of w ood fo ’ de stove—
and you’ll be gone a week.” Sambo looked very much ag­
grieved: “ H oney,” he said, “ what’s de mattah? Y ou all
talks as though ah was takin’ de ax with me.”
s t Si s

A NY S T R A N G E R

that opens up a checking account with
a cash deposit should be investigated. Looking over a
list of recent forgeries over the country I find that a great
number of forgery schemes were started in that manner. T he
crook would deposit several hundred dollars in cash, and off
and on would deposit small out-of-tow n checks. Finally he
would deposit a check of several thousand dollars and before
it had time to clear be would withdraw most of the money.
T h e check would come bouncing back, a forgery; and by that
time the crook had “ bounced” away.
s t St st

A Dagain:
D TO

B A N K E R in a nearby town has a system that cures the

since this.

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Federal Reserve Bank of St. Louis

L I S T of people that will not hoard

A n aged farmer hid $6,000 in bills of large denomina­
tion in a bin filled with 2,000 bushels of oats. Fire destroyed
the granary with its $6,000 in cash.
s

s

s

''J p H E Y S A Y Ed W yn n pulled this one:
“ I asked a friend ‘how ’s business?’ H e replied, ‘T e r ­
rible, I ’m cutting and saving wherever I can. I ’m even tak­
ing long step to save my $6.00 shoes.’ He showed me how
he did it— and split his $8.00 pants.”

st st st
X
instant-check-casher. T here was one lady that every
time she received a check on this banker’s bank, would rush
to the bank and get the money. She wanted the money right
now. T h e banker let this go for quite a while, then one
day he said: “ M rs. Blank, I ’m getting tired of you coming
rushing in here with every check you get on us. I ’m going
to pay you in currency this time, but the next time you come
in I ’m going to pay you in silver dollars. T hey are legal
tender. Y ou better bring a sack along next time.” T he
lady has let her checks clear through the regular channels

THE

st st s

T Y N E B U S IN E S S M A N says he used to go into a drug
store and ask for a bottle of ink and they would give
him a bottle of blue without any questions. N ow he goes in
and they say: “ W h a t color? R e d ?”
st s

^

s

N E W F O R M O F B O N D that has been suggested is

x
meeting with favorable comment. T h e new bond would
be made payable in gold dollars equal in purchasing power
to the original amount of the loan, which would be fair. T he
drawback to this form of bond seems to be the fact that it is
a fairly new idea and would meet with skepticism.

5

Central Western Banker, August, 1933

The Commercial Department
A s the Savings Manager Sees It
N T H E M A J O R I T Y of our cities
throughout the United States, and
especially in the M iddle W est, com­
mercial and savings banking are carried
on in the same institution, the savings as
a department of the commercial bank.
T h e question arising in a situation
such as this, is just what relation can be
established between the savings depart­
ment and the deposit functions of such
banks? Are they allied in any way?
A re they in any sense dependent upon
each other? If so, is there any merit in
dove-tailing the activities of these two
departments or shall they function en­
tirely independent and foreign to each

I

other?
Granted that they are closely associ­
ated, what unseen link is there, then,
that tends to bind these two departments
together? Surely it cannot be necessity,
or because the public demands that they
should be. T h e functions of commer­
cial accounts and savings accounts are
entirely separate and distinct. A com­
mercial account is used to finance the
day-to-day banking needs of commercial
and industrial enterprises.
Its chief
function is to finance the movement of
commodities. Savings deposits represent
accumulations of capital in an interestbearing term account. W e come to the
conclusion then that service, that unseen
force that moves the wheels of industry,
must be the binding link — it can be no
other.
Controlled Service

Service, of course, is an indispensable
requisite essential to the existence of any
institution. However, we must take care
not to become slaves of services, but in­
stead so control them that they w ill not
eventually become liabilities and work
to our detriment.
It has been the our privilege to attend
the Century of Progress Exposition in
Chicago. A Century of Progress— one
hundred years into the past— twentyfive years into the future. Let us con­
sider of what significance this progress
is to the commercial and the savings
banker. If we look back over a period of
a century or more, yes, even back into
the year 1782 when the Bank of Penn­


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Federal Reserve Bank of St. Louis

e y R O LA N D PE TER IN G
Manager Savings Department
Mercantile Home Bank & Trust Co.
Kansas City
sylvania was granted the first charter
issued by our Federal government, we
will see that through the generations of
hankers preceding us, this item of serv­
ice and harmonious contact of bank de­
partments, has in no small way helped
to build the many large banking estab­
lishments we have with us today. But
are we now building for the future? In
the early days, before the banker became
the close figuring business man he is to­
day, the customer expected his banker to
be his legal adviser and general counsel
on all matters, and in return, he carried
practically all of his money on deposit
at the bank, perhaps because he knew of
no other way of investing it. Bank serv­
ice, then, was richly repaid. But, today,
when too many competitive institutions

" W H I L E we cannot afford to
carry small and perhaps unprofit­
able commercial accounts, we can
offer them banking facilities incor­
porated in our savings department.
A d o l l a r or t wo in a savings
account might eventually mean a
s ubs t a nt i a l c h e c k i n g account,
with goodwill that is wo rth
cultivating"

of finance are invading the field of bank­
ing— we find it necessary to watch our
corners a little closer and organize our
banks a great deal better, so that in the
future years, we might meet these com­
petitive forces better prepared than we
have ever been before.
Since service, then, is the binding link
between the commercial and savings de­
partments of our banks, it is as a gen­
eral rule important that these depart­
ments work in harmony with each other,
as long as services thus rendered are for

the mutual benefit of the banker and
the depositor, and as long as such serv­
ices shall not fall under the heading of
“ unprofitable business.”
Commercial Department

T h e commercial department, as I see
it, is a cumbersome piece of machinery.
It demands the attention of more exec­
utives and the efforts of more employes,
than any other department in a banking
institution. T o offset this, however, most
of the banks today allow the cost of op­
erating this department to fall on the
commercial depositor in the form of a
service charge. This works an undue
burden upon the commercial depositor
for he is forced in many instances to
contribute towards the handling of trans­
actions arising out of other departments
that eventually find their way in to the
deposit functions of the bank. T o o o f­
ten we find that our services are abused
and rendered without remuneration, to
parties who have no reasonable grounds
for making such requests.
It is well worth the while of any bank
to analyze its services, and to impose cer­
tain limitations which are just and equi­
table, on those extra outside or unrea­
sonable services performed without any
direct or indirect returns to the bank.
T h e issuance of cashiers’ checks to
customers carrying small savings ac­
counts is a situation that exists in almost
every bank. If the depositor carries a
small and unprofitable checking account,
he is, as a general rule, charged a small
fee of ten or fifteen cents, but only too
often a customer desiring a cashier’s
check will inform the teller of a savings
account which he carries at the bank, and
the teller issues the check without
charge, presuming that his customer car­
ries a substantial balance, and failing to
bear in mind, that the customer may be
carrying a very small account for the
sole purpose of making it a source
through which he might utilize the free
services of the bank. T h e bank would
lose less money on such depositor if it
allowed him to carry a commercial ac­
count without charge. T h e savings de­
positor should be no exception when

6

Central Western Banker, August, 1933

equitable fines or fees are affixed for ex­
traordinary and unprofitable services
rendered.
Collections

A similar service of the commercial
department often abused by the savings
depositor is that of making collections
on notes left at the bank by the custom­
er, the proceeds of which are to be cred­
ited to a savings account. T his account
is oftentimes carried at the bank for no
other purpose than to defeat such col­
lection charges as a bank should be en­
titled to for service thus rendered. It
has been my experience that frequently
these funds are allowed to remain on
this account for only a few days subse­
quent to collection, and then the greater
portion of such funds withdrawn, and
possibly taken to a building and loan as­
sociation because a little higher rate of
interest can be obtained, but where such
services as his bank has so graciously
rendered, cannot be offered.
Approximately two years ago the Kan­
sas City banks, through the help and co­
operation of the A uditor’s Conference
and the Kansas City Clearly House A s­

sociation, established a uniform system
of service charges. Commercial accounts
are now analyzed monthly to determine
the amount of profit or loss sustained on
each account. A charge of three cents
for every check written, three cents for
every deposit made and one cent for
every check deposited, plus a fifty cent
carrying charge, is assessed. O n the other
hand, the customer is allowed as a cred­
it, twenty-seven and a half cents per
hundred dollars realized balance carried
on the account. If the account shows a
loss, the credit is used to diminish the
cost of carrying the account over the pe­
riod of one month. T h e important ques­
tion then presented by the customer was
whether or not such service charge made
on an unprofitable checking account or
one showing a loss, should be waived,
because of a substantial savings balance,
and whether such savings balance should
be given any consideration at all in com­
puting the costs of carrying the unprofit­
able commercial account.
T h e irate customer who had been as­
sessed the charge, regardless o f his sav­
ings account, often forgot that he was

Your Association Says:“ W e have been notified that the National Bureau of Casualty and Surety U n ­
derwriters has decided to try to cure the present unfavorable experience in the bank
robbery line by means of requiring the banks to keep most of their cash under timelock throughout the day.
“ Happily, through the efforts of our Protective Committee, the great majority
of Nebraska banks are already follow ing this practice, so this new requirement will
not mean much change in present methods to most of our banks.
“ In this Association’s efforts to induce the banks to apply the protection of the
timelock to a large part of their cash throughout the day, we were surprised by sug­
gestions from two member banks that they would not lock up their cash voluntarily,
but if we could have the surety companies adopt such a rule, and have it universal
among banks, they felt that this would remove the element of danger and that then
they would gladly join in the practice. Probably other bankers are thinking along
the same line.
“ This new regulation by the surety companies that furnish robbery coverage to
banks w ill very shortly become common knowledge among the fraternity of bank
robbers and should have the effect of reducing the number of bank robberies, since
the profit would be largely removed therefrom, and should also remove almost en­
tirely the danger of resentful action by robbers.
“ T h e new rule will allow but 15 per cent of the coverage to be exposed on
counters. If more counter exposure is considered by the bank to be necessary, a
double premium w ill apply upon the extra exposure. Provision is made for amounts
unexpectedly received while the timelock is in operation until such money can be
placed behind the timelock. A t the periods when the timelock opens, all doors to
the premises must be securely locked, or the bank must place two armed guards at
each unlocked door.
“ T his new regulation is effective July 15th and it is our understanding that
riders w ill be sent to all banks direct from the home office of each surety company.”

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Federal Reserve Bank of St. Louis

being paid interest on his savings bal­
ance, and if he wished to eliminate the
service charge on his commercial ac­
count he might easily transfer a suffi­
cient sum from the interest bearing ac­
count to his checking account so that the
bank might at least “ break even” on it.
Under ordinary circumstances a bank
should not allow a savings account to
carry a check account or the customer
to lean on his savings for other free
services of a bank.
Savings Balance

It is well, however, for those in the
commercial department to be informed
upon such matters as a savings balance
for more reasons than one. Overdrafts
we of course all try to avoid, but they
seem to be one of those ever-present nec­
essary evils with which we daily come
in contact. It might, indeed, be quite em­
barrassing to return, because of insuffi­
cient funds, the check of some commer­
cial depositor when such depositor car­
ries a lucrative savings balance and has
upon some occasion temporarily and per­
haps not w illfully, neglected to replen­
ish the checking account. A little serv­
ice under these circumstances costs so
little and yet is very gratefully accepted
by the customer.
W h at service, then, do we owe the
small depositor— the man of small and
moderate means, or perhaps the small
business that has a possibility of some
day growing into a flourishing industry?
Shall we close our doors to them? Shall
we bar them from our services with pro­
hibitive charges? N o, we hold ourselves
out to the public as an institution w ill­
ing to serve them as individuals and as
a community. If we would be other­
wise, we would invite ridicule and pre­
sent a target for public criticism. Here
we again find the solution in uniting
more cleverly the savings and deposit
functions of our banks.
Financial Revolution

W h ile we cannot afford to carry these
small and perhaps unprofitable commer­
cial accounts, we can offer them our
banking facilities incorporated in the sav­
ings department. Indeed, your customer
might begin with a dollar or two or
perhaps with a Christmas savings ac­
count, and eventually build that account
to where he is able to carry a checking
account, his goodwill is certainly worth
cultivating. O n many occasions I have
witnessed that courteous treatment of
these small and inconspicuous depositors,
has led to their bringing friends and rel(C o n tin u e d on p a g e 12)

7

Central Western Banker, August, 1933

D E P O S I T G U A R A N T E E ______
NOW

That W e Have It,

W H A T A r e W e G o in g To Do A b o u t I t ?
A

Discussion of the Deposit Guarantee Features of the 1933 Banking Bill
and Their Effect on American Banking

F

E D E R A L guarantee of bank de­
posits! T w o months ago a rank im­
probability— today a stark and
startling reality. An ignominous failure
wherever tried— is history to repeat it­
self now on a much grander and more
catastrophic scale?
It seems almost incredible, in the light
of past experiences, that a Congress of
the United States has seen fit to adopt
a deposit insurance plan and place an
added burden upon the banks of the
country. T h e idea has been tried in
eight of our states. It failed with dis­
astrous results in all of them.
As a matter of cold logic, however,
there appears to be no good reason why
bank deposits cannot be insured against
loss just as intelligently and economically
as any other risk.
Standard actuarial
principles could no doubt devise a sound
and economic insurance plan, based on a
study of risks and expected losses, and
calling for the payment of a regular pre­
mium calculated to cover all anticipated
losses and return a profit to the insurer.
A paternalistic government, regulated by
partisan politics rather than by sound
business principles, could hardly be ex­
pected to run an insurance business on
the same safe and sane basis.
For behold — the lawmakers have
made the identical mistake which has
made previous attempts at deposit guar­
antee such ghastly failures. T hey have
taken the matter out of the realm of ac­
tuarial limits and placed it on a founda­
tion of guesswork. T hat is what oc­
curred in Nebraska, and what contrib­
uted most to the downfall of the Nebras­
ka deposit guarantee scheme.
T h e big mistake has been made in de­
termining the method of collecting the
funds with which to absorb losses aris­
ing through bank failures. Instead of
basing it on a premium, payable at stated

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Federal Reserve Bank of St. Louis

By W IL L IA M E. JOHNSON
Executive Vice President
Devlin & Bennett, Inc.
Chicago
intervals (such as annually, semi-annu­
ally, or quarterly) Congress has dictated
a “ perhaps you w ill— perhaps you w on ’t”
policy in regard to the necessity for
paying assessments.
T h e revised text of the Banking A ct
of 1933 gives us the operating procedure
which is to be followed. A ll member
banks of the Federal Reserve System are
required to join the plan by July 1,
1934. T heir initial contribution shall be
in the form of a purchase of Class A
stock of the insuring corporation, to an
amount equal to one-half of 1 per cent
of the total time and demand deposits
of each individual bank. O nly half of
this amount will be called for originally,
but the directors of the insuring corpor­
ation have the privilege of calling the
other half as they see fit. T h e stock will
receive dividends at the rate of 6 per
cent per annum, on a cumulative basis.
T h e law specifically provides for
changes in the stockholding requirement
on a given bank as its deposits increase
or decline.
T he next effect of these
provisions, therefore, is to maintain the
bank’s share of the fund for paying losses
at a more or less fixed ratio of onefourth of 1 per cent of total demand and
time deposits in banks covered by the
insurance protection.
T h e balance of the insurance corpora­
tion’s fund w ill consist of $150,000,000
appropriated from the Treasury of the
United States, plus the purchase by the
Federal Reserve Banks of Class B stock
in the amount of one-half of the surplus
of the bank on January 1, 1933, half of
the subscription being payable immedi­
ately.

Although the new bill as supposed to
make banking practically fool- and lossproof, the designers of the act worked on
the presumption that we would continue
to have bank suspensions. Failures nat­
urally meant depletion in the risk fund.
Depletion would call for replacement if
the fund were to continue to be opera­
tive. H ence the insuring corporation has
been given the authority to levy an as­
sessment on the banks to the amount of
one-fourth of 1 per cent of their total
deposit liabilities, whenever the amount
paid out on claims, etc., shall exceed onefourth of 1 per cent of such deposits.
Assessments vs. Premiums

Payments of “ premiums” on deposit
insurance will not be at stated intervals
as in other forms of insurance, but on a
basis of assessment as the fund is de­
pleted. Herein lies the weakness of the
federal insurance plan; the same weak­
ness which existed in Nebraska and sev­
eral other states which tried deposit
guarantee. This is what happened: For
some unknown reason banks continued
to fail even after their deposits were
guaranteed. Some unkind people even
say that they failed because their depos­
its were guaranteed. Be that as it may,
the result was that the funds got low.
T h e failures took place largely during an
ebb-tide in the local picture. T hen came
the assessments, at a time when good
banks could ill afford to pay them. One
assessment coming at the w rong time
could make a bank insolvent. T h e result
was more failures, and bigger ones— un­
til the banks gave up the ghost and quit
trying to make the thing work.
T hat is exactly what is apt to happen
with the federal plan, unless something
is done to make it economical and prac­
tical. T h e lawmakers failed to do it.
Y et now that we have it, we simply can’t

8

Ce7itral Western Banker, August, 1933

afford to allow it to fail again— partic­
ularly on a nation-wide basis. Y et if it is
to work at all— and it must work— the
bankers are going to have to make it
work.

ferent departments of the bank. Check­
ing deposits, certificates of deposit, and
passbook savings, — each will have a
slightly different method of approach
and a different sales policy.

The Bankers’ Responsibility

Checking Deposits

T he only way that we as bankers can
guarantee the success of the plan is to
take the aggressive in placing the scheme
on a business-like basis. W e must arbi­
trarily assume that our costs for insur­
ance protection over a period of years
will be equal to one-half of 1 per cent
per annum, and we must place that
amount in reserve each year in readiness
of future assessments, and they will un­
doubtedly come just at the time when
we can least afford to meet them. T hat
has been the history of the assessment
idea, and we have no reason to believe
that it will work any differently on a
national basis. T o make ourselves secure
we must make up for the errors of our
lawmakers and place it on an annual
premium basis.

Let us look first at the commercial
checking department. For a number of
years this department has been relatively
inefficient from the standpoint of profit
production. Almost universal acceptance
of the advantages of checking service has
led to a tremendous increase in the pub­
lic use of that service. Result: increased
activity, increased overhead costs, and
no increase in loanable balances to com­
pensate the bank for costs incurred in
providing service.

Who W ill Pay the B ill?

T he next question is : W h o is going
to pay the bill? W ill the banks assume
cost as an added burden to their already
burdensome expenses, or will the depos­
itor pay for the protection of his own
money? W h o should pay?
As an owner of an automobile, I rec­
ognize a number of risks that must be
assumed. I might lose the use of the
machine through fire or theft. I might
be the victim of a judgment as the result
of an accident. Important risks, all of
these, and for my own protection I “ in­
sure” myself against those risks with a
responsible insurance company.
W h o pays for this protection ? Does
the company who finances the purchase
of the car pay for it? N o. Does the in­
surance company provide it gratis? N o.
As the chief beneficiary of this risk as­
sumption— as the one whose property is
being protected— I pay the premium.
T h e same logic holds true in all forms
of insurance, the person who insures his
risk is the one who pays the premium.
H ence, just as logically, the cost of de­
posit insurance under the Banking A ct
of 1933 should not be borne by the
banks, but by the depositors themselves,
in direct proportion to the amount of
their risk which is being assumed.
T h e next question is: H o w are the
banks going to pass this premium cost on
to the depositors? T h e answer:
By
charging them their proportional share
of the total insurance cost. T h e method
of procuring the charge w ill vary in dif­

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Federal Reserve Bank of St. Louis

T h e modern, the efficient, the fair
method of operating this department at
a profit— as it should be run— is by the
application of a measured service charge,
under which each customer w ill pay,
either in actual charges for service or in
compensating balances, not only the ac­
tual costs incurred in servicing his ac­
count, but a fair profit as well.
Banks which are already operating on
a measured service basis will encounter

" W E A S B A N K E R S cannot
afford to let the federal deposit
guarantee fail. O ur only hope to
salvage it, and to make of it an
active instrument in the upbuilding
of American banking, is to regulate
our own policies in su ch a manner
as to g ua r a n t e e its integrity for
all time"

no difficulty in passing the deposit in­
surance charge along to their checking
depositors. It will simply require a slight
upward revision in prices for service, to
offset the increased costs for insurance
protection.
Banks which do not have the meas­
ured charge are confronted with a seri­
ous problem. If they have a flat charge
in operation, they may be assured that it
is not large enough to pay more than a
portion of actual servicing costs. T hey
are already losing money on that ar­
rangement.
It would be possible for
them to add to present flat rates a charge
at the rate of one-half of 1 per cent per
annum on average balances, computed
monthly. T hat would be a make-shift at

best, however, and the wise thing— the
practical thing— is to replace present in­
efficient and unprofitable flat charge sys­
tems with the measured charge.
T he profit rate in the average country
bank is currently so low that it cannot
possibly permit the banks to operate at
even a small profit if this insurance cost
is to be added to their overhead burden.
Savings Deposits

In the savings department the neces­
sity for passing the cost along is even
more striking. T h e average net earning
rate in country banks during recent
months has been 4.28 per cent. If we
deduct from this the overhead costs of
maintaining departmental records, etc.,
averaging .61 per cent and also .50 per
cent representing a fair rate for normal
investment losses, we have a net avail­
able for interest and profits of 3.17 per
cent.
T h e average bank pays an advertised
rate of 3 per cent, which results in an
effective rate of 2.75 per cent. If we
deduct this from the operating net of
3.17 per cent, we have a resulting net
profit margin of .43 per cent. It is not
at all difficult to see that the average
savings department will operate at a se­
rious loss if we take into consideration
current rather than normal investment
losses, and if the bank is compelled to
bear the entire burden of deposit insur­
ance costs.
In those banks where the advertised
rate is in excess of 3 per cent, and there
are many such, the possibility of profit­
able operation is almost completely
eliminated.
Shifting the Burden

T he selling job and the method of
passing on the cost of deposit insurance
to regular savings depositors and to
holders of deposit certificates is essen­
tially the same. Each bank has an ad­
vertised rate of interest. T hat rate, in­
cidentally, should never be in excess of 3
per cent on pass-book savings or 3^2 per
cent on certificates, because it is eco­
nomically impossible to make a profit
while paying at a higher rate under ex­
isting investment conditions. Let us as­
sume that our bank is paying the above
rates.
The Selling Job

T o cover the probable cost of deposit
insurance, we w ill deduct one-half of 1
per cent, thereby reducing our rates to
2 Y2 and 3 per cent.
T his reduction
should not be accomplished in any arbi­
trary manner. Each customer must be
(C o n tin u e d on p a g e 13)

9

Central Western Banker, August, 1933

"Take advantage of every opportunity
to keep your bank and its savings department
favorably before the public.

W hen you have the public

behind you, you have one of your most valuable assets.

Guard it zealously77

The G R E A T E S T A S S E T of Your
Savings Department

A

Q U E S T I O N before many of us
in the banking profession at this
time is what change of policy, if
any, should be made in view of the pres­
ent financial and business conditions,
and the new banking legislation enacted
in Washington. It is perfectly natural
for us to give consideration to some de­
gree of retrenchment but present con­
ditions should not influence us to make
too serious inroads, particularly on the
program of public relations work of
which advertising plays an important
part.

and one of the most important problems
facing bankers today.
W ith the guarantee of bank deposits
which the new bank bills make possi­
ble, the public’s fear as to the future
safety of banks to a large extent will
pass and the banker must now turn his
thoughts to building up his savings bus­
iness through intelligent selling, friend­
liness, helpfulness, courteous and fair
dealing, rather than continual preach­
ment about the safety of the institution
due to its size and sound management.

A Mistake

T he capital structure of a bank, its
strong directorate and large personnel
will make little difference to John and
M ary Doe. M ost banks w ill probably

T h e sudden and substantial reduction
in advertising expenditures by many
banks in my opinion is a serious mis­
take.
By this policy banks have un­
doubtedly suffered a tremendous loss of
prestige, and their most precious asset,
public confidence and goodwill, which is
the basis of banking success. In a pe­
riod of depression in which financial
problems became peculiarly pressing, it
is evitable that the banks should be the
target of a great amount of misunder­
standing and criticism.
Some of this
misunderstanding only time can cure,
but it is highly important that bankers
themselves should use every proper
means to make known the facts about
the situation and to nullify the false im­
pressions and loose criticisms which are
not based on facts. Silence is not always
golden. H o w can the banker blame the
public for misunderstanding him if he
makes no effort to explain himself. T o
initiate, cultivate and retain confidence
and the goodwill of the public, without
the aid of consistent and intelligent ad­
vertising leaves only one alternative at
present — aggressive, personal selling,
which I believe is the greatest asset for
any savings department, large or small,

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Federal Reserve Bank of St. Louis

All the Same

A N A D D R E S S d e l i v e r e d by
Frank Fuchs, advertising manager
of the First N a t i o n a l Ba nk of
St. Louis, before the 1933 con­
vention of the American Institute
of Banking, in Chicago

be very much the same to the man in the
street when he is assured that his funds
are protected by the new banking laws.
These depositors will he attracted and
held by the personality of these banks—
your bank is but the reflection of your
personality. Y ou r savings customers in
the future w ill base their opinion of
your bank entirely upon the treatment
they receive when they contact with you.
There is no way you can create public
goodwill in a better manner, in the ab­
sence of intelligent advertising.
Banking today more than ever before,
is essentially a relationship between the

person representing the bank and the
person representing the public. I know
that I have got to be a better public re­
lations man than I have been before if
1 am to live up to the job that I expect
will exist in my institution, because bank
relationships are in a state of flux and
depositors are in an unsettled inquiring
state. W e are entering a new banking
age in which we w ill have to constantly
sell our institution and merchandise our
services at a profit instead of" a loss.
Contact employes must therefore be
sales-minded, especially those employed
in large downtown banks because there
must be some incentive for the public to
come any great distance to do their
banking, especially when all banks large
or small, as far as safety of deposits is
concerns, will practically be on the same
level in the public’s mind.
A Different Public

Obviously you have a harder job than
ever and a far more important one, for
you have an entirely different public to
deal with than before. If educational
work on banking is to be successful, you
must carry a large portion of the load,
if you cannot depend upon advertising
to assist you. It is imperative that each
contact employe in your institution real­
ize the value of cooperation on his part,
for the benefit of all. Suggest improve­
ments in your departments of service—
give the public facts concerning your in­
stitution, its services and how it oper­
ates. Let your customers bring up the
question that is troubling them. Y our
part is to have a ready answer to every
question asked. “ Come, let us reason
together,” is a bit of good advice as old
as the prophets. It is just as potent to­
day as the day it was first uttered. So
counsel with those of your customers
(C o n tin u e d on p a g e 14)

10

Central Western Banker, August, 1933

Public Relations—
A

Harder But More Important Job

A n address by Roy Dickinson, associate editor of Printer’s Ink, before a meeting
of the financial advertisers of New York.

He says that

7ours is the opportunity

to take a real and active part in one of the greatest decades in all history^
O C O P Y the words of the man
who wrote the best bank adver­
tising copy I have read in many a
year, I think the time has come to stop
worrying just who it was who left the
icebox door open. W e all know that the
milk was soured.
W h a t we want to
know now, is when the milkman is com­
ing with a fresh quart and how we can
hasten its arrival.
I f the last few years proved that we
couldn’t be ballyhooed into prosperity,
it is also true that we cannot now be
slandered into recovery.
T here is no doubt that 1933 w ill go
down in history as the year of the great
showdown. M ost men, most businesses
and banks w ill prove solid. Some are
now seen to have been hollow, empty
shells. From this point on, the public
w ill know where to pin its faith. From
now on we are going to judge a man
not by what he has in his safe deposit
box, but what he has in his heart and in
his spirit. Those individuals and indus­
trial and banking concerns who will cave
in, and those who w ill go forward to a
better service, seem to be dividing them­
selves at the present moment right be­
fore our eyes. “ W h a t is darkness to
some people is being seized upon by oth­
ers as a swell chance to strike a light.”
N ew ideas for all sorts of merchandise
such as farm implements, saws and other
inventions came in the bleak uncertain­
ties of the early ’40’s. In 1857 and an­
other panic, other great leaders started.
As we look back we find that every bad
period was the opportunity for some men
to go ahead with new ideas.

T

Big Boss Interested

T his thought that new ideas are es­
sential for the important job of financial
advertising now, leads me quite natur­
ally into what was handed me as the
text of my talk— “ Keeping M acD onald
Interested.”

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Federal Reserve Bank of St. Louis

M acD onald is the Big Boss. It comes
from this. T here was a round-table in
an old Highland castle. A stranger came
into the warmth and the light from the
cold and snow outside. H e had a mes­
sage to deliver to the man “ at the head
of the table,” the chief’s place. T h e
table had no head, so the stranger had
to ask. T h e n the burly, big boss made
the famous remark, first used by Emer­
son in “ T h e American Scholar” —
“ W here M acD onald sits, there is the
head of the table.” M any M acG regors
have protested that their name is the
correct one, but M acD onald it is.

I wonder whether you have been able
to make your M acD onalds realize that
at the present moment your job namely,
interpreting the banks to the public, is
probably one of the largest jobs which
faces any group of men and women in
America today. Unless a man is a con­
servator he must see this point of view.
A friend of mine told me the other day
that his dream was to become a conserv­
ator. H e said to me, “ Y ou know that is
the swellest job in the world because
a conservator can’t lose. T h e bank is
closed anyway before he ever gets start­
ed and he is in there all alone.”

A t many a present-day round-table
advertising discussion in the manufac­
turer’s or banker’s office, the echo of that
remark should be making history today.

New Ideas

T h e big boss ought to be on the ad­
vertising job. M acD onald should be do­
ing his stuff. H e should be sitting at the
advertising table, helping. W h at can
possibly be more important for bank
heads today than their public contacts,
the voice of their bank in print, the way
the public feels about it, what the public
knows about all banking.
Roosevelt,
when he used the word “ mattress” over
the radio gave bank M acD onalds some­
thing to think about. W h y did the pres­
ident of the United States have to do the
job they should have done?
Most Important Job

It is my firm belief that the day is
past when the president’s contribution to
his bank’s advertising program is a some­
what guiding acceptance of the fact that
some of it ought to be done. It is w or­
thy of his best efforts and consideration.
W h a t else can be more important? Is
he too big or too busy to take upon him­
self what the president of the United
States had to do in a crisis? W h a t can
he be busy about that is more important ?
I ’m asking you.

H o w orthodox is that peculiar condi­
tion where the patient can neither elim­
inate an old idea, nor absorb a new one.
T h e man or woman with a new idea
for bank advertising is very likely to
have a new idea for the product, for the
bank itself. T hat is how it happens in
other lines. T ea kettles went along sell­
ing a certain definite amount each year
until somebody in the advertising depart­
ment suggested to the Rome M anufac­
turing Co. that they ought to be made
more attractive— an idea added. So
Rome produced an unusual kettle to re­
tail at $1. It has a molded plastic han­
dle and a bird’s head, also of molded
plastic, which whistled loudly when the
kettle began to boil. W histling tea ket­
tles. T here was something different. In
three months the company sold 160,000
of these kettles and was working night
and day to catch up with demand.
H ere is a wild idea by an outsider.
H o w about a group of banks talking to
a few insurance companies about taking
over loans on policies? W h y are insur­
ance companies in the banking business?
W h y do they get 6 per cent for loaning
a man his own money when banks will
take 5 ? W h at is better collateral if a
(C o n tin u e d on p a g e 22)

Central Western Banker, August, 1933

" W e can have a d e g r e e

11

of r e c o v e r y through expansion of consumer’s goods,

but the r eal substantial volume of business must be based upon the confidence
in the saving and growth of capital accumulations^

Present Problems of Investment Banking
S W E t a k e a survey of the present investment position, we find
that there are several paradoxes in­
dicating a conflict of various forces. W e
find that business has turned about its
course without monetary changes rec­
ommended by some financial doctors.
There has been a promise of inflation of
credit and currency and yet, as a matter
of fact, we have prices moving upward
and business moving upward with a con­
tracting of Federal Reserve credit. M any
of our industrial concerns were in such
a liquid position that they have been able
to finance the present degree of recovery
without much, if any, additional use of
credit.
a

In a sense we are true to history in
that we have a revision of our banking
law. F or the first time we now have an
attempt to guarantee bank deposits on a
national scale. One of the paradoxes in
this situation is that all of our past ex­
perience with silver, with currency, and
with guarantee of bank deposits would
point to the inadvisability of such a
measure. T h e Bank A ct has another pro­
vision in it very distinctly giving the
Federal Reserve System the power to
regulate the use of bank credit, and it
separates the investment banking busi­
ness from all direct contact with the
commercial and private banking business
of the country.
Flow of Capital

It is evident that the flow of capital
into industry may very readily take two
form s; first, short-term capital, essen­
tially bank credits; and second, long­
term, through the issuance of securities
in the market. It becomes very difficult

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By R ALE IG H H. RIFE
Economist
Guaranty Trust Company
New York
to distinguish at any particular moment
of time when the continuation of bank
credit may be an anticipation of future
bond issues. O n account of the diffi­
culty of segregating this flow of capital
into these two categories for a good many
years, it became the practice of the larg­
er American banks to establish bond de­
partments to help synchronize this flow
of capital to industry, and in later years
these bond departments became separate
investment affiliate companies.
In a
sense, there had been developed a depart­
ment-store method of banking, includ­
ing commercial and short-term and long­
term credit to industry. T h e segrega­
tion of the instrumentality for furnish­
ing long-term capital from the commer­
cial banks may, in a short period of time,
retard the flow of capital to industry.
W e also have invested the President
of the Lhiited States with the authority
to issue $3,000,000,000 of greenbacks in
case he is not able to arrange with the
Federal Reserve Banks to purchase that
many Government bonds through open
market operations; to accept $200,000,000 of silver at the price of 50 cents an
ounce in payment of Government debts
on the part of foreign governments ;
further the right to the establishment of
the free and unlimited coinage of silver
at a ratio to be determined by hint; and
further the reduction of the gold content
of the dollar up to 50 per cent, which
means that the existing gold supply in
the country would make twice as many

gold dollars, as furnish a reserve for
twice as many paper dollars under the
old laws. Probably there has never been
a time in the history of our country
when such powers of such far-reaching
consequences were given into the hands
of one individual.
Provision Accomplished

Fet us assume, for instance, that the
$3,000,000,000 provision is accomplished
either through open market operations
of the Federal Reserve Banks and the
issuance of Federal Reserve Bank Notes
secured by Government bonds, or else
by the printing of paper money, and that
we have coined $200,000,000 of silver
— it would be evident then that the tok­
en monetary supply of the country would
consist of the follow in g:
W e would
have in circulation silver, paper money
in the form o f greenbacks, and govern­
ment secured currency in the amount of
about $5,500,000,000, which would ap­
proximate the amount of currency that
was in circulation in the boom period of
1929. In addition there would be our
supply of gold and Federal Reserve
Notes.
There is an old law of monetary sci­
ence which is known as Gresham’s Law,
which states that the cheaper money will
tend to drive out the dearer or sounder
money.
T h e success in having token
money in circulation alongside of gold
money is in the limitation of the amount
of such money. If too large an amount
of token money is put into circulation,
it might very readily be that on an at­
tempt at some future time to make such
money convertible into gold, you will
find that gold will be driven out of cir­
culation.

12

Central Western Banker, August, 1933

New Problems

Due to the uncertainties as to what
may happen in respect to currency ques­
tions, it becomes a complicated problem
for the investor to know what to do. A
surveyor must have his starting points
fixed, and in a sense that is what the in­
vestor has to have.
If the monetary
program is to be inflation of the extreme
type, it means that there is activity in
the stock market and then eventually
the effort to get out of the market and
into commodities and real property. It
would seem as if the experiences of his­
tory have been so definite in regard to
the ultimate effects of inflation that one
is surprised to find that he is confronted
with it as a suggested solution of our
present problems. T h e investor is fur­
ther confronted with a good deal of un­
certainty as to the application of many
other programs in W ashington, and it
seems a safe guess to make today that
only when we know more definitely
what is the direction and until we know
through experimentation how some of
the plans are going to operate, will the
investor know to what he can tie as a
guiding sign. This particularly applies
to the Industrial Recovery Bill and the
Agricultural Bill with its processing tax.
Practically all attempts to regulate
prices and production of agricultural
products, as far as history testifies, have
not been very successful. Probably the
country that has had the longest experi­
ence in this respect is Brazil, with its
coffee valorization program. This pro­
gram started about 1905 whereby the
government issued the plants, financed
the surplus crops, and maintained a high­
er level of prices. T his encouraged the
production of coffee in Brazil and also
in many other countries of the world.
T h e Brazilian program has taken vari­
ous forms, but in recent years they de­
cided to tax the coffee grower in order
to destroy part of the production. H o w ­
ever, recent estimates show that the sup­
ply of coffee available for the next sea­
son w ill be unparalleled in it magnitude.
New Rules

T h e investment banker is confronted
with an entirely new condition of affairs
today, embodied in the “ Securities A ct
of 1933.” T his provides new rules in
the way of data and in connection with
the registration of new securities. Until
rules and regulations are clearly drawn,
indicating the method of operation under
this A ct, it may have a retarding influ­
ence in supplying industry with capital,
but it should generally be said that in­

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vestment bankers, as a whole, are desir­
ous of cooperating to the fullest extent
and to see that the investor is given the
fullest information available in order for
him to arrive at a decision. I think that
we may safely say that there is one basic
principle that we have to tip up to in the
field of investment banking and in the
general field of investments. W e never
can supplant the element of good ju d g­
ment in the selection of the proper type
of securities and we cannot eliminate the
factor of good management in any type
of business. There is probably no other
country in the world that has gone as
far towards government inspection and
supervision of banks as has taken place
in the historical development of the U ni­
ted States, and yet the banking history
of this country has so many dark pages
that we must again conclude that in the
realm of banking the safest thing to tie
up to is good management.
Apply the Brakes

W e have seen considerable discussion
of the fact that prosperity would return
if we had prices back to the level of
1926, so that on the average the debtor
would be able to repay his debt with a
dollar whose purchasing power would
be the same as when the debt was con­
tracted.
T h e probability is, however,
that our degree of prosperity was height­
ened by the flotation of foreign loans in
this market, and by the creation of in­
ternal debts of various kinds for supply­
ing long term capital needs. Until we
can generate some such a program on the
part of our people, we cannot expect a
reasonable degree of employment. T he
past tells us that this takes time to ac­
complish and that it is slow to respond,
after a serious setback. As I view the
perspective today of the last few years
in connection with the supplying of long
term capital, I am quite convinced that
what our economic organization really
needs is some way of putting on the
brakes when speculation in long-term
capital becomes too pronounced. Perhaps
if something could be done along these
lines, we might not be talking so much
about digging ourselves out of the depths
of the valley of the depression; but when
the public mind has become filled with
a point of view, naturally it becomes
very difficult to apply the brakes. T he
history of the development of this coun­
try has shown such striking waves of
speculation in real estate that the F lor­
ida episode perhaps seems natural in the
course of events. W h en such a specu­
lative move was underway, it is per­

fectly clear that the public was not seek­
ing conservative advice, and would not
heed it when given. T h a t is probably
one of the penalties that we have to pay
for one of the peculiarities of human
nature.
There is an observation I would like
to make on the present outlook. T h e
country certainly speculated itself into
trouble in the period culminating in
1929, and it hardly seems reasonable to
assume that we should speculate our­
selves out of the valley of the depres­
sion. Industrial activity must be based
upon sounder grounds than speculation.
W e should develop these phases of our
financial, monetary and economic life
that encourage the investment of capital,
which stress the elements of stability
and security and hence encourage cap­
ital to seek real investment rather than
speculation. W e can have a degree of
recovery through expansion of consum­
ers’ goods, but the real substantial vol­
ume of business must be based upon the
confidence in the saving and growth of
capital accumulations.

THE COM MERCIAL
DEPARTM ENT
A S THE SA V IN G S
M A N A G E R SEES IT
(C o n tin u e d fr o m p a g e 6)

atives o f means to the bank with large
checking accounts and sometimes their
business accounts. This little item of
goodwill, intangible though it may seem,
is often carried at far too nominal a
sum in the estimation of the banker.
“ M ighty oaks from little acorns grow ”
is an old saying you have heard all your
lives. Have you ever applied this thought
in the building of a bank. N ot all of the
acorns develop into mighty oaks, nor do
all your small accounts grow into large
sums, but the percentage is certainly
worthy of your consideration. History
has recorded and the Century of P rog­
ress will show you the results of indus­
trial revolutions in the past. W e are
now in the midst of a financial revolu­
tion. M any of our customers have felt
the effects of this crisis, ill effects for
the most part. Some of them must be­
gin over. T heir accounts will be small at
first, but it is up to us as the leaders in
finance to be patient and considerate and
to give crippled industry a chance to get
back on its feet again, thus deriving
therefrom a mutual benefit, in a speed­
ing up of the return to prosperity and
plenty.

Central Western Banker, August, 1933

DEPOSIT G U A R A N T E E —
(C o n tin u e d fr o m p a g e 8)

sold on the idea that the reduction is
solely for the purpose of providing him
with greater protection for the safety of
his deposits.
W hen the insurance coverage goes
into effect, the banks should use the in­
surance appeal as a basis for encourag­
ing new deposits. N ew as well as old
customers should be advised in a care­
fully worded circular as to the funda­
mental provisions of the deposit insur­
ance plan. Each of them should be edu­
cated in the benefits which will actually
accrue to their personal selves, and edu­
cated also into the idea that they, as the
beneficiaries, should pay the cost of the
protection.
A t the end of the interest period, the
normal interest should be computed, the
charge for deposit insurance deducted,
and the balance credited to the account.
It would simplify the procedure some­
what merely to reduce the advertised
rate by one-half of 1 per cent and figure
interest at the lower rate. In any event,
the depositor should know that he is the
one who pays the bill for the insurance
protection.
Certificates of Deposit

O n certificates of deposit, the custom­
er will be notified when he enters the
bank either to purchase an original cer­
tificate or to renew an old one.
He
should be told the current advertised
rate paid on certificates, and he should
be sold on the idea that the one-half of
1 per cent fee should be paid by him for
protection by which he alone benefits.
“ O f course we will be glad to sell you
a certificate of deposit, M r. Jones. W e
pay 3j/2 per cent on these certificates
when you leave the money here six
months or longer. Y ou understand, of
course, that it is compulsory for us to
have your deposit insured through the
Federal Deposit Insurance Corporation.
It is necessary for us to deduct the
amount of your premium from the in­
terest, hence we will write this certificate
at 3 per cent.”

13
credited to a “ Reserve for Federal D e­
posit Insurance” account, where they
should be held pending the time when
assessments w ill be necessary to replen­
ish the insurance fund.
O ver a period of time this account
w ill assume large proportions. So much
the better.
It w ill provide additional
protection to our own depositors, and
assure us of being able to meet any as­
sessments without embarrassment.

It Must Not Fail

W e cannot as bankers afford to allow
the federal deposit guarantee to fail. It
could only fail with disastrous results to
the entire American banking and eco­
nomic structure. Unquestionably the
present guarantee bill is unbusinesslike
and heir to practically all of the weak­
nesses which produced the failure of
guarantee systems wherever previously
attempted. O u r only hope to salvage it,

Guaranty Trust Company
of New Y ork
140 Broadway
LONDON

PARIS

BRUSSELS

CONDENSED

LIVERPOOL

H AVRE

ST A T E M E N T , JUNE 30, 1933

RESOURCES
Cash on Hand, in Federal Reserve Bank,
and due from Banks and B a n k ers...............................$
U. S. Government Bonds and C ertifica tes.........................
Public S e c u r itie s .........................................................................
Stock of the Federal Reserve B a n k .....................................
Other S e c u r i t i e s .........................................................................
Loans and Bills Purchased.......................................................
Real Estate Bonds and M o r t g a g e s .....................................
Items in Transit with Foreign B r a n c h e s .........................
Credits Granted on A ccep tan ces...........................................
Bank B u i l d i n g s .........................................................................
Accrued Interest and Accounts Receivable.........................


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

249,332,300.94
482,920,173.19
75,975,692.67
7,800,000.00
24,975,205.41
491,098,292.13
2,655,085.74
6,985,873.89
83,214,878.18
14,202,829.83
5,954,375.91
$1,445,114,707.89

L IA BILITIE S
C a p i t a l ....................................................... $ 90,000,000.00
Surplus F u n d ...........................................
170,000,000.00
Undivided P r o f it s .....................................
7,266,269.98

Setting TJp Reserves

Having arranged to procure from the
customer the premium cost on his de­
posit insurance, we are now confronted
with the problem of how it should be
handled on the books. T o begin with,
savings insurance will be taken out semi­
annually at interest dates. Certificates
w ill be an almost daily occurrence, and
the collection from the checking cus­
tomers will be made monthly. As these
payments are received they should be

ANTW ERP

$
Accrued Interest, Miscellaneous Accounts
Payable, Reserve for Taxes, etc...................................
Acceptances
..................................................................................
Liability as Endorser on Acceptances and
Foreign B i l l s .................................................................
D e p o s it s ................................................. $1,054,343,334.79
Outstanding C h e c k s .........................
33,277,860.33

267,266,269.98
6,940,262.61
83,214,878.18
72,102.00

1,087,621,195.12
$1,445,114,707.89

Central Western Banker, August, 1933

14

and to make of it an active instrument
in the upbuilding of American banking
is to regulate our own policies in such
a manner as to guarantee its integrity
for all time. W e can only do that by
providing of our own volition the pro­
tection and the business-like procedure,
which a political body failed to provide.
Unquestionably again, if all bankers
were to adopt wholeheartedly all of the
suggestions above, banking operations
would be conducted at a fair profit re­
gardless of economic conditions, depleted
reserves would rapidly be restored, new
ones would be set up for the further
protection of our depositors, and guar­
antee of bank deposits w ill have a chance
to work for the first time in history.

THE G R EATEST ASSET
OF THE
SAVIN G S D EP A R T M E N T
(C o n tin u e d fr o m p a g e 9)

who are anxious for information con­
cerning your bank and their account.
It is safe to say, that the majority of
your depositors know very little about
your bank, and what little they do know
they have learned from financial adver­
tising in the past. If you are competent,
friendly, considerate, and interested in
your depositors’ affairs, your steady
growth and popularity will reflect these
facts— because you soon have the respect
and confidence of these depositors and
their friends. Take advantage of every
opportunity to keep your bank and its
savings department favorably before the
public. Abraham Lincoln said, “ W ith

the public behind you, you can do every­
thing.” W h en you have the public be­
hind you, you have one of your most
valuable assets. Guard it zealously. It
keeps any bank flourishing in normal
times and it will be a bulwark of
strength and confidence in times of
emergency. It is the momentum that is
the invisible aid to saving banking— es­
pecially if your represent a non-advertised bank.
Severe Test

O u r whole economic structure, our
social fabric and governmental regime,
all are undergoing a severe, searching
test of their fitness to serve. T h e old
order of things is broken; a new order
is in the making in every field of en­
deavor. W e are at the crossroads. W e
have passed out of the valley. W e are
entering a new era— we must forge
ahead with new plans, new ideas and in­
creased vigor. T h e different conditions
through which the financial world has
passed, have brought a new challenge
to everyone in the banking profession.
In no field of business is there greater
need for vigorous and intelligent public
relations policies than in finance. Know
your public and get them to know you.
Be enthusiastic. Y ou must become well
acquainted with the value of a smile,
and know that banking is conducted as a
service to the public, because banks are
institutions for the public to use. There
should be no air of mystery about them.
W e have services that must be sold—
but these service no matter what they

G M A C SHORT TERM MOTES

available in limited amounts
upon request

G
A


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

M

eneral

cceptance

C

otors

o r po r a tio n

may be are harder to sell than tangible
products. Existing systems of business
development and customer cultivation
must measure up to the standards de­
manded of them under present condi­
tions, especially in the savings depart­
ment.
It is well to remember that develop­
mental work, (that is aggressive sales­
manship), is by no means confined to the
solicitation of new savings business. As
a matter of fact, that is a comparatively
minor part of it. A large volume of
new savings business and sometimes the
best type of new savings business comes
through your present customers and this
is particularly true with non-advertised
banks.

Bank Bill Explained
T h e Northwest Bancorporation has
gotten out a twelve page folder entitled
“ A T opical Digest of the Banking A ct
of 1933,” which is the Glass-Steagall
Bill, and is giving this widespread dis­
tribution throughout the northwest ter­
ritory.
T h e bill is analyzed point by point,
and the information contained therein is
full and complete. Copies, of course, may
be obtained direct from the Northwest
Bancorporation of Minneapolis.

Serious Feed Situation
Livestock producers in the principal
livestock producting states from Ohio
westward to the Pacific Coast states are
facing one of the most threatening feed
situations in many years. As a result of
the record June drought and high tem­
perature over most of this area, pasture
conditions on July 1 were the poorest
for any July on record; range feed con­
ditions in the western range states were
the poorest for July 1 and in the 11
years for which records are available ;
and the condition of both cattle and
sheep in these states was the lowest on
July 1 for these 11 years.
T h e yield per acre of oats and barley
w ill be the smallest since 1900, at least,
if not the smallest on record, and the
total production of these w ill be the
smallest in many years, according to the
July report of the Crop Reporting Board
of the U. S. Department of Agriculture.

Executive Office " Broadway at 57th Street " New Y or\, M- Y.
OFFICES

IN

P R I N C I P A L

CITIES

Barber: “ H aven’t I shaved you be­
fore, sir?”
Customer: “ No, I got that scar in
France.”

Central Western Banker, August, 1933

15

I N plication
S U toRtheABanhincf
N CYraternitu
E

Ita A j j

W hen the W in d W h istles—
Do You Hear a Cheerful or a Mournful Tune?
T W A S not so long ago that fire was
considered to be an act of G od rath­
er than a mistake of man.
Im ­
proved design and construction have
minimized the damage by fire to a point
where it may be controlled or, at least,
kept within certain limits. H o w unlike
this is the dreaded windstorm or tor­
nado.
None knows when or where a w ind­
storm will strike or what w ill be its pro­
portion. It may select your home or it
may wipe out your town or, as has so
often happened, counties or entire sec­
tions of a state are leveled. T h e wind
recognizes no master, but through the
financial stability of our insurance com­
panies, it may be insured against. W e
cannot prevent a loss, but we are able
to replace damaged property.
Realizing the large area over which
the destruction by windstorm may
spread, it is the purpose of this article,
not only to show how the individual
may protect himself, but also how the fi­
nancial institutions which hold m ort­
gages may protect their investments.
Every section of the country has
windstorms that are sufficiently severe to
warrant windstorm insurance.
Every
property owner and every mortgagee is
a prospective client. T his is a field that,
instead of being overworked, is under­
developed.

I

The Contract

It is a universally accepted fact that,
under the fire insurance contract, if a
material part of the building fall, the
fire insurance contract is automatically
voided. If it is considered that a suffi­
cient portion of the building does not
fall to void the contract and fire ensues,
only the damage done by fire will be
paid. If the building were caused to fall
in whole or part by windstorm, it is evi­
dent that under the most advantageous
conditions only a portion of the loss
would be paid under the fire insurance

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

By R A L P H W . T A Y L O R
Examiner
A etn a-W orld Insurance Co.
contract. It would be next to impossible
to determine how much of the loss was
caused by the windstorm and how much
by the fire ; this would give rise to argu­
ment and dissatisfaction. Under the old
windstorm policy the loss caused by the
windstorm only would be paid. Even
though a fire were caused as a direct
result of the windstorm, only the dam­
age done by the windstorm would be
paid under a windstorm policy. It is,
therefore, evident that under certain
conditions there is a gap between the
coverage afforded by the windstorm con­
tract and the first contract.

'A S Y O U G O over your list of
prospects, does the wind whistle
a tune of satisfaction because you
have protected your clients and
your business, or does it howl de­
rision at you for not doing s o ? "

Complete Protection

Recognizing the need of complete pro­
tection to the assured and the sales ad­
vantage to the agent, a clause for at­
tachment to the old type of tornado poli­
cies has been designed which bridges the
fire-tornado gap. T h e newer windstorm
policies which are in use, or will soon
be in use, throughout nearly the entire
country, contain the provision that a loss
by fire caused as a direct result of a
windstorm which, because of the voiding
of the fire contract, is not covered under
the fire policy, will be paid under the
windstorm policy, according to the pro­
visions of the contract. If this feature
is overlooked in the scheduling of the

insurance of a client, a great injustice is
being done, not only to the client but to
yourself.
It is evident that both fire and tor­
nado coverage are necessary and that
only where bridging the fire-tornado gap
clause provision is in some way a part
of the tornado contract, will the assured
have complete protection. This demon­
strates another advantage of the com­
bined fire and windstorm contract.
Real property and chattels are in­
sured under a tornado policy with a tor­
nado form very similar to a fire form.
T ornado rents or rental value insurance
may be added by endorsement or a sep­
arate policy may be issued. T h e com­
bination fire and tornado policy is a
convenient and painless way of selling
this protection, as it involves but one
premium.
Business Interruption

A business may be interrupted by
damage to a manufacturing plant by
windstorm which will delay the opera­
tion of the plant just as though it were
damaged by fire. T h e same insurable
interest exists as though the damage
were caused by fire. T ornado business
interruption forms which are attached to
the standard tornado policy are no more
complicated than the fire form, and the
coverage should never be overlooked.
Interest rates on mortgages have been
reduced in some sections. This means
that the income to the mortgagee is re­
duced. T here is just so much less to set
up a reserve to meet such a contingency
as would be caused by a windstorm or
tornado in a section where the loan com­
pany or bank hold their mortgages. T he
mortgages are bound to be concentrated
in an area which might be affected. T he
local loaning organizations operate in a
small area and it is not an idle obser­
vation that it might be completely wiped
out. T h e large national organizations
operate through local agents which tends

Central Western Banker, August, 1933

16
to centralize the loans in the territories

tornado

errors

and

omissions

policy

under the jurisdiction of the individual

would be a worth-while investment to

local loan agents.

such a company.

Some loan companies require that the

T here is just as much tornado insur­

mortgagor carry tornado insurance with
a mortgagee clause in their favor. P oli­
cies are liable to lapse; or through some
mistake a tornado policy may not be is­
sued to protect the individual risk. A

ance of all classes to be written now as
ever before, and present conditions sim­
ply tend to accentuate its need. But the
rules and rates vary in different sections
of the country, so let the home office

be the clearing house for the informa­
tion that you need.
As you go over your list of prospects,
does the wind whistle a tune of satisfac­
tion because you have protected your
clients and your business, or does it howl
derision at you for not doing so and, in­
cidentally, leaving this very fertile field
as an entree for your competitors?—
Aetna Fire Group M essenger.

W e ll-K nown Corner Finally Turned
Excerpts from The Business Bulletin, edited by Col. Leonard A yres,
V ice President of the Cleveland Trust Company, indicate business
is well on the road to recovery
E C O V E R Y from depression has
come repeatedly, both in this
country and abroad, by a restora­
tion of public confidence in the sound­
ness and integrity of the national money.
O ur present experiment is based on the
creation of doubt concerning the value
of our money, which results in a general
movement to buy commodities and equi­
ties.
Its justification depends on its
success.

R

IT

H A S become convincingly evident
that the corner of the great depres­
sion was turned in this country between
the first and second quarters of this
year.
T T IS W O R T H

noting that the de­

pression index and its three compon­
ents turned up last summer, and in the
main held their gains well to about the
end of last year, when political dissen­
sions and the banking troubles brought a
decline that carried them down to new
lows in M arch, after which the present
recovery began. T hat recovery which be­
gan last summer appears to have been
the turning point for most of the other
important industrial countries. Industry
continues its advance abroad, while here
we are making our second attempt at
recovery.
T N U R I N G the past quarter the value
of our money has been declining
abroad, and the prices of securities and
commodities have been advancing here.
So far there have been fairly close rela­
tionships between these price move­

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

ments. W e may measure the changes in
the exchange value of our money by de­
termining the price of an ounce of gold
in American dollars. If we do that we
shall find that it advanced during the
second quarter by about 25 per cent.
M eanwhile the prices of active whole­
sale commodities moved up by about 50
per cent and those of industrial stocks
by about 75 per cent.
J N M A R C H the index of industrial
production used by this bank as the
current part of its long-term indexes of
business activity was at the low level of
45.4 per cent below the computed nor­
mal level. T h e April figure was only
39 per cent below the normal level, and
the preliminary M ay figure is only 30.8
per cent below. T his is approximately
the level of September, 1931. Nearly all
of the 18 industrial series composing the
total index, except those for coal produc­
tion, showed notable advances in M ay.
P P A R E N T L Y more than a billion
dollars of idle currency is still be­
ing hoarded in this country. T w o years
ago, in June of 1931, business activity
was at about the same levels as it is now.
A t that time the practice of hoarding
was almost unknown, and the amount of
currency in circulation, other than small
coins, amounted to about four and a
half billion dollars.
A t the present
time the amount is approximately a bil­
lion dollars greater than it was then,
and since price levels are lower, and
wages less, and business activity no
greater, it seems clear that the amount
of currency being hoarded is still be­

tween a billion and a billion and a half
dollars.
g U S I N E S S R E C O V E R Y is now go­
ing forward in this country at the
most rapid rate ever reached in our eco­
nomic history. Activity in business is in­
creasing more than twice as swiftly as
it has done in any previous period of up­
turn from depression conditions, and at
a pace about five times as rapid as that
attained in 1915 when the huge war
orders poured in from Europe.
J T IS N O T N O W possible to judge
whether or not so rapid an advance
will prove to be undesirably swift, for
there is no similar previous case with
which to make comparisons.
W e do
know that the spectacular recovery in
1838 was largely based on speculation
and so-called wildcat money, and that
it was followed by another period of de­
pression.
Nevertheless conditions ob­
taining then were so different from those
existing now that the earlier instance
may be of little value as a guide.
rp H E R E

CAN

BE

no

doubt

that

much of the recent sudden demand
for good has been caused by fear that
our money will be progressively less val­
uable in the months ahead. In large
measure people have been demanding
goods to make up accumulated shortages,
but in some considerable degree they are
exchanging hoarded money for goods
that they may hoard instead. Perhaps
we could wisely moderate temporarily
our efforts to stimulate business still
further.

Central Western Banker, A ugu st, 1933
^ iiiiiiim iiiim iiiiiiiim m im iiiiiiiim im iiiiiiiiiiiiiiii

iniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii

17
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Nebraska
News
II. H . I5 A III5 E I1 , P r e s i d e n t
N e b r a s k a B a n k e r s A s s o e ia tio n

W M . IS. H U G H E S , S e c r e t a r y ,
N e b r a s k a IS a n k e r s A s s o c i a t i o n

....................... ............................................................................ ................................................................................................................................................................................................................................................. .................................................................................................................................................................................. mimi.............................. ......... .......... ........................=

Unrestricted In Nebraska
( A s of July 2 5 )
H E F O L L O W I N G is a list of
National banks in Nebraska which
are now operating on an unre­
stricted basis. T his list was compiled as
of July 25, and while every precaution
was taken to insure accuracy, we assume
no responsibility for any errors which
may appear therein:
A insA vorth, C o m m e r c ia l N a tio n a l B a n k
A in s w o r t h , N a tio n a l B a n k o f A in s w o r t h
A lb io n , A lb io n N a tio n a l B a n k
A lb io n , F ir s t N a tio n a l B a n k
A llia n c e , A llia n c e N a tio n a l B a n k
A llia n c e , N e b r a s k a N a tio n a l B a n k
A m h e r s t, F ir s t N a tio n a l B a n k
A r c a d ia , F ir s t N a tio n a l B a n k
A sh la n d , F a r m e r s a n d M e rc h a n ts N a tio n a l
B ank
A tk in s o n , F ir s t N a tio n a l B a n k
A u b u rn , C a r so n N a tio n a l B a n k
B a n c r o ft , F ir s t N a tio n a l B a n k
B a y a r d , F ir s t N a tio n a l B a n k
B e a tr ic e , B e a t r ic e N a tio n a l B a n k
B e a tric e , F ir s t N a tio n a l B a n k
B e em er, F ir s t N a tio n a l B a n k
B e ld en , F ir s t N a tio n a l B a n k
B e n e d ic t, F ir s t N a tio n a l B a n k
B r a d s h a w , F ir s t N a tio n a l B a n k
B u tte , F ir s t N a tio n a l B a n k
C a m b r id g e , F ir s t N a tio n a l B a n k
C e n tr a l C ity, F a r m e r s N a tio n a l B a n k
C h a d ro n , F ir s t N a tio n a l B a n k
C o le r id g e , C o le r id g e N a tio n a l B a n k
C olu m b u s, C e n tr a l N a tio n a l B a n k
C oza d, F ir s t N a tio n a l B a n k
C r e ig h to n , A m e r ic a n N a tio n a l B a n k
C rete, C ity N a tio n a l B a n k
D a v id C ity , F ir s t N a tio n a l B a n k
D on ip h a n , N a tio n a l B a n k o f D o n ip h a n
E lw o o d , F ir s t N a tio n a l B a n k
E m e r so n , F ir s t N a tio n a l B a n k
F a ir b u r y , F ir s t N a tio n a l B a n k
F a lls C ity , F ir s t N a t io n a l B a n k
F r e m o n t, F r e m o n t N a tio n a l B a n k
F r e m o n t, S te p h e n s N a tio n a l B a n k
F rie n d , F ir s t N a tio n a l B a n k
F u lle r to n , T h e F ir s t N a tio n a l B a n k
F u lle r to n , F u lle r t o n N a tio n a l B a n k
G en oa, F ir s t N a tio n a l B a n k
G en oa, G e n o a N a tio n a l B a n k
G e r in g , G e r in g N a tio n a l B a n k
G o rd o n , F ir s t N a tio n a l B a n k
G ra n d Isla n d , F ir s t N a tio n a l B a n k
G ran t, F a r m e r s N a tio n a l B a n k
G re e le y , C ity N a tio n a l B a n k
H a m p to n , F ir s t N a tio n a l B a n k
H a r r is o n , S io u x N a tio n a l B a n k
H a s tin g s , H a s tin g s N a tio n a l B a n k
H a v e lo c k , H a v e lo c k N a tio n a l B a n k
H a y s C en ter, F ir s t N a tio n a l B a n k
H a y S p rin g s , F ir s t N a tio n a l B a n k
H o ld r e g e , F ir s t N a tio n a l B a n k
H o o p e r , F ir s t N a t io n a l B a n k
Im p e r ia l, F ir s t N a tio n a l B a n k
J o h n so n , F ir s t N a tio n a l B a n k
K im b a ll, A m e r ic a n N a tio n a l B a n k
L a u r e l, S e c u r ity N a tio n a l B a n k
L e w e lle n , F ir s t N a tio n a l B a n k


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Federal Reserve Bank of St. Louis

L in c o ln , C o n tin e n ta l N a tio n a l B a n k
L in c o ln , F ir s t N a tio n a l B a n k
L in c o ln , N a tion a l B a n k o f C o m m e r ce
L o o m is , F ir s t N a tio n a l B a n k
L o u p C ity , F ir s t N a tio n a l B a n k
L y m a n , F ir s t N a tio n a l B a n k
L y o n s, F ir s t N a tio n a l B a n k
M cC o o k , F ir s t N a tio n a l B a n k
M cC o o k , M cC o o k N a tio n a l B a n k
M a d iso n , F a r m e r s N a tio n a l B a n k
M a rq u e tte , F ir s t N a tio n a l B a n k
M in a ta re , F ir s t N a tio n a l B a n k
M in d en , F ir s t N a tio n a l B a n k
M in d en , M in d en E x c h a n g e N a tio n a l B a n k
M in d en , N e b r a s k a N a tio n a l B a n k
M itc h e ll, F ir s t N a tio n a l B a n k
M o o re fie ld , B a n k o f M o o re fie ld
M o rr ill, F ir s t N a tio n a l B a n k
N e b r a s k a C ity , M e rc h a n ts N a tio n a l B a n k
N e b r a s k a C ity , N e b r a s k a C ity N a tio n a l

Bank

N e b r a s k a C ity , O toe C o u n ty N a tio n a l B a n k
N e lig h , T h e N a tio n a l B a n k o f N elig h
N e w m a n G rov e, F ir s t N a tio n a l B a n k
N o r fo lk , D e la y N a tio n a l B a n k
N o rth P la tte , F ir s t N a tio n a l B a n k
O a k d a le , F ir s t N a tio n a l B a n k
O a k la n d , F a r m e r s an d M e rc h a n ts N a tio n a l
Bank
O m aha, F ir s t N a tio n a l B a n k
O m aha, L iv e s t o c k N a tio n a l B a n k
O m aha, O m ah a N a tio n a l B a n k
O m aha, P a c k e r s N a tio n a l B a n k
O m aha, S to c k y a r d s N a tio n a l B a n k
O m aha, U. S. N a tio n a l B a n k
O’ N eill, F ir s t N a tio n a l B a n k
O’ N eill, O’N eill N a tio n a l B a n k
Ord, F ir s t N a tio n a l B a n k
O sm on d , F ir s t N a tio n a l B a n k
O sce o la , F ir s t N a tio n a l B a n k
O v e rto n , O v e r to n N a tio n a l B a n k
P e n d e r, F ir s t N a tio n a l B a n k
P ilg e r , F a r m e r s N a tio n a l B a n k
P rim r o s e , F ir s t N a tio n a l B a n k
R a n d o lp h , F ir s t N a tio n a l B a n k
R u s h v ille , S to c k m e n s N a tio n a l B a n k
St. P a u l, C itiz e n s N a tio n a l B a n k
St. P a u l, St. P a u l N a tio n a l B a n k
S e o tts b lu ff, S c o tt s b lu ff N a tio n a l B a n k
S e w a rd , C a ttle N a tio n a l B a n k
S e w a rd , J o n e s N a tio n a l B a n k
S h elb y, F ir s t N a tio n a l B a n k
S idn ey , T h e A m e r ic a n N a tio n a l B a n k
S p r in g v ie w , F ir s t N a tio n a l B a n k
S ta n to n , F ir s t N a tio n a l B a n k
S ta n to n , S ta n to n N a tio n a l B a n k
S tr o m s b u rg , F ir s t N a tio n a l B a n k
S tu art, F ir s t N a tio n a l B a n k
S y ra cu se , F ir s t N a tio n a l B a n k
T e k a m a h , F ir s t N a tio n a l B a n k
T ild e n , T ild e n N a tio n a l B a n k
U n a d illa , F ir s t N a tio n a l B a n k
V a le n tin e , F ir s t N a tio n a l B a n k
W a h o o , F ir s t N a tio n a l B a n k
W a k e fie ld , W a k e fie ld N a tio n a l B a n k
W a lth ill, F ir s t N a tio n a l B a n k
W a y n e , F ir s t N a tio n a l B a n k
W a y n e , S ta te N a tio n a l B a n k
W e e p in g W a te r , F ir s t N a tio n a l B a n k
W e s t P o in t, F ir s t N a tio n a l B a n k
W ilc o x , F ir s t N a tio n a l B a n k
W lisner, C itiz e n s N a tio n a l B a n k
W is n e r , F ir s t N a tio n a l B a n k
Y o r k , C ity N a tio n a l B a n k
Y o r k , F ir s t N a tio n a l B a n k

State Banks
T h e follow ing Nebraska banks, un­
der the jurisdiction of the State Banking
Department, are now (July 25) operat­
ing on an unrestricted basis. W h ile the
source from which the names were ob­
tained is considered reliable, we take no
responsibility for any omissions or other
errors which may appear.
A d a m s, A d a m s S ta te B a n k
A le x a n d r ia , S ta te B a n k o f A le x a n d r ia
A llia n c e , G u a rd ia n S ta te B a n k
A lm a , H a rla n C o u n ty B a n k
A lv o , F a r m e r s an d M e rc h a n ts B a n k
A n s le y , S e c u r ity S ta te B a n k
A r a p a h o e , A r a p a h o e S ta te B a n k
A r a p a h o e , C itiz e n s S ta te B a n k
A r lin g to n , A r lin g t o n S ta te B a n k
A r n o ld , A r n o ld S ta te B a n k
A s h b y , G ra n t C o u n ty S ta te B a n k
A s h to n , S ta te B a n k
A tla n ta , A tla n t a S ta te B a n k
A u b u rn , A u b u r n S ta te B a n k
A v o c a , F a r m e r s S ta te B a n k
A x te ll, F a r m e r s a n d M e rc h a n ts B a n k
B a n c r o ft , C itiz e n s S ta te B a n k
B a r tle tt, B a r tle t t S ta te B a n k
B a r tle y , S ta te B a n k o f B a r tle y
B e a tric e , B e a t r ic e S ta te B a n k
B e a v e r C ity, F ir s t S ta te B a n k
B e n k e lm a n , S ta te B a n k o f B e n k e lm a n
B e n n in g to n , B a n k o f B e n n in g to n
B en n e tt, C itiz e n s B a n k
B e r w y n , F a r m e r s S ta te B a n k
B ig S p rin g s , F a r m e r s S ta te B a n k
B in g h a m , B a n k o f B in g h a m
B lo o m in g to n , B lo o m in g t o n S ta te B a n k
B lu e H ill, C o m m e r c ia l B a n k
B lu e S p rin g s , B lu e S p rin g s S ta te B a n k
B oe lu s, B o e lu s S ta te B a n k
B ra d y , B a n k o f B r a d y
B r a in a rd , B a n k o f B r a in a r d
B r is to w , N e b r a s k a S ta te B a n k
B r id g e p o r t , B r id g e p o r t S ta te B a n k
B r o a d w a t e r , U n ion S ta te B a n k
B rock , B an k o f B ro ck
B r o k e n B o w , N e b r a s k a S ta te B a n k
B r o k e n B o w , S e c u r ity S ta te B a n k
B r u n in g , B r u n in g S ta te B a n k
B r u n s w ic k , B r u n s w ic k S ta te B a n k
B u r c h a r d , S ta te B a n k o f B u r c h a r d
B u rr, A m e r ic a n B a n k
C a iro, S ta te B a n k o f C a iro
C a lla w a y , S ev en V a lle y s S ta te B a n k
C a m b r id g e , S ta te B a n k
C a m p b ell, F a r m e r s S ta te B a n k
C a r le to n , C itiz e n s S ta te B a n k
C en ter, C en ter S ta te B a n k
C e r e sco , F a r m e r s an d M e rc h a n ts B a n k
C h a m b ers, C h a m b e r s S ta te B a n k
C le a r w a te r , C itiz e n s S ta te B a n k
C od y, B a n k o f C od y
C olon , S ta te B a n k o f C o lo n
C o m s to c k , F a r m e r s a n d M e rc h a n ts B a n k
C ook, F arm ers B an k
C oza d, C o za d S ta te B a n k

Central Western Banker, August, 1933

18
C r a w fo r d , C r a w fo r d S ta te B a n k
C rete, C re te S ta te B a n k
C u lb e rtso n , C u lb e r ts o n B a n k
C u rtis, C u rtis S ta te B a n k
C u sh in g , C u s h in g S ta te B a n k
D a lto n , D a lto n S ta te B a n k
D a n n e b r o g , S ta te B a n k o f D a n n e b r o g
D a v e n p o r t, J e n n in g s S ta te B a n k
D a w so n , D a w s o n B a n k
D a y k in , J e ffe r s o n C o u n ty B a n k
D esh le r, N e b r a s k a S e c u r ity B a n k
D e W itt, S ta te B a n k o f D e W it t
D ic k e n s, F ir s t S ta te B a n k
D ille r, D ille r S ta te B a n k
D o r c h e s te r , C itiz e n s S ta te B a n k
D o u g la s , F a r m e r s S ta te B a n k
D u B o is, S ta te B a n k o f D u B o is
E d d y v ille , E d d y v ille S ta te B a n k
E d g a r, S ta te B a n k o f E d g a r
E d g a r , C la y C o u n ty S ta te B a n k
E d is o n , F a r m e r s an d M e rc h a n ts B a n k
E lb a , E lb a S ta te B a n k
E lk C re e k , S ta te B a n k
E lk h o r n , F a r m e r s S ta te B a n k
E llis, E llis S ta te B a n k
E lm w o o d , A m e r ic a n E x c h a n g e B a n k
E lsie , C o m m e r c ia l S ta te B a n k
E lw o o d , H o m e B a n k
E m e r so n , F a r m e r s S ta te B a n k
E m m e t, E m m e t S ta te B a n k
E n d e r s, F ir s t S ta te B a n k
E r ic s o n , E r ic s o n S ta te B a n k
E u stis, F a r m e r s ' S ta te B a n k
E u stis, P io n e e r S ta te B a n k
E w in g , F a r m e r s S ta te B a n k
F a ir fie ld , F a ir fie ld S ta te B a n k
F a ir m o n t, B a n k o f F a ir m o n t
F a ir m o n t, F a r m e r s S ta te B a n k
F a lls C ity , F a lls C ity S ta te B a n k
F a lls C ity , N e b r a s k a S ta te B a n k
F a lls C ity, R ic h a r d s o n C o u n ty B a n k
F a rn a m , F a r n a m B a n k
F a r n a m , S ta te B a n k
F r a n k lin , F r a n k lin S ta te B a n k
G en eva , G e n e v a S ta te B a n k
G ib b o n , E x c h a n g e B a n k
G o eh n e r, G o e h n e r S ta te B a n k
G ord o n , G o r d o n S ta te B a n k
G o th e n b u r g , F a r m e r s S ta te B a n k
G o th e n b u r g , G o t h e n b u r g S ta te B a n k
G r a fto n , G r a ft o n S ta te B a n k
G ra n d Isla n d , C o m m e r c ia l B a n k
G resh a m , G re sh a m S ta te B a n k
G u id e R o c k , G u id e R o c k S ta te B a n k
H a lla m , H a lla m B a n k
H a rd y , F a r m e r s S ta te B a n k
H a y la n d , F ir s t S ta te B a n k
H a y S p rin g s , N o r th w e s t e r n S ta te B a n k
H e b ro n , T h a y e r C o u n ty B a n k
H e n d le y , F a r m e r s S ta te B a n k
H e rm a n , H e r m a n S ta te B a n k
H ic k m a n , F ir s t S ta te B a n k
H ild r e th , F r a n k lin C o u n ty B a n k
H ild r e th , S ta te B a n k

H o lb r o o k , S e c u r ity S ta te B a n k
H o lm e s v ille , S ta te B a n k o f H o lm e s v ille
H o w e lls , H o w e lls S ta te B a n k
H u b b e ll, H u b b e l B a n k
H y a n n is, B a n k o f H y a n n is
H u m b o ld t, H o m e S ta te B a n k
H u n tle y , S ta te B a n k o f H u n t le y
Im p e r ia l, F a r m e r s an d M e r c h a n ts B a n k
Ith a c a , F a r m e r s S ta te B a n k
J u n ia ta , S ta te B a n k o f J u n ia ta
J o h n so n , F ir s t S ta te B a n k
K e a r n e y , F o r t K e a r n e y S ta te B a n k
K e e n e , F a r m e r s S ta te B a n k
K e n n a r d , K e n n a r d S ta te B a n k
K ey ston e, B an k o f K e y sto n e
K ilg o r e , F a r m e r s S ta te B a n k
K r a m e r , F a r m e r s S ta te B a n k
L e b a n o n , L e b a n o n S ta te B a n k
L e m o y n e , L e m o y n e S ta te B a n k
L e sh a ra , L e s h a r a S ta te B a n k
L e w is to n , B a n k o f L e w is t o n
L e x in g to n , D a w s o n C o u n ty S ta te B a n k
L e x in g to n , F a r m e r s S ta te B a n k
L e x in g to n , L e x in g t o n S ta te B a n k
L in c o ln , C itiz e n s S ta te B a n k
L in c o ln , U n io n B a n k
L in w o o d , F a r m e r s & M e rc h a n ts B a n k
L is c o , L is c o S ta te B a n k
L o d g e P o le , F ir s t S ta te B a n k
L o rto n , B a n k o f L o r t o n
L o u is v ille , H o m e S ta te B a n k
L u sh to n , B a n k o f L u s h to n
M cC o o l J u n c tio n , F a r m e r s an d M e rc h a n ts
B ank
M cC o o l J u n c tio n , B lu e R iv e r B a n k
M cG re w , F a r m e r s S ta te B a n k
M a d rid , S ta te B a n k o f M a d rid
M a n ley , M a n le y S ta te B a n k
M a y w o o d , F a r m e r s S e c u r ity B a n k
M a rte ll, M a r te ll S ta te B a n k
M ead, B a n k o f M ead
M em p h is, B a n k o f M em p h is
M ern a , F a r m e r s B a n k
M e rrim a n , A n c h o r B a n k
M ilfo r d , F a r m e r s a n d M e rc h a n ts B a n k
M illa rd , F a r m e r s S ta te B a n k
M ille r, B a n k o f M ille r
M ille r, C itiz e n s S ta te B a n k
M o n ro e , B a n k o f M o n r o e
M o o re fie ld , B a n k o f M o o re fie ld
M o rs e B lu ff, B a n k o f M o rs e B lu ff
M u rra y , M u r r a y S ta te B a n k
N e b r a s k a C ity , F a r m e r s B a n k
N ehaw ka, N eh aw ka B an k
N elson , C o m m e r c ia l B a n k
N em ah a , B a n k o f Nemtaha
N io b r a r a , B a n k o f N io b r a r a
N ora, N o r a S ta te B a n k
N o r fo lk , S e c u r ity S ta te B a n k
N orm a n , N o rm a n E x c h a n g e B a n k
N o rth P la tte , M cD o n a ld S ta te B a n k
Oak, S c r o g g in & Co. B a n k
O co n to , F a r m e r s B a n k
O dell, S ta te B a n k o f O d ell

ST A T E M E N T OF CONDITION, JUNE 30, 1933
RESOU RCES
L o a n s & D is c o u n ts ....................................................................$1,769,059.11
B o n d s & S e c u r itie s ........... ........ ........................... ....................
67,809.99
16,500.00
S to c k in F e d e r a l R e s e r v e B a n k -------- ---------------- ------B a n k in g H o u se ........... ......... ...... .......................................-......
50,000.00
F u r n it u r e & F ix t u r e s ....................................... ........ ................. N one
O th er R e a l E s t a t e ...................................... -......... ----- ---------1.00
U. S. G o v ’ t. S e c u r itie s ................................$1,715,661.33
C ash, S ig h t E x ch . & D u e F r o m
F e d e r a l R e s e r v e B a n k ....................... 1,663,789.31
3,379,450.64
$5,282,820.74
L IA B IL IT IE S
C a p ita l ......................................... ............................... •
$ 450,000.00
S u rp lu s ...................—................ -...............................-------- --------100,000.00
U n d iv id e d P ro fits ............ -..... -......... — ..................... — -......
62,234.18
U n e a rn e d D is c o u n t ----------- ------------.............- ................. ----16,362.29
R e s e r v e d f o r T a x e s, In te r e st, e t c ................—-....... ---........
19,126.69
D iv id e n d p a y a b le Ju n e 30, 1933 ........— ..........-...........-.....
6,750.00
D e p o s its :
P u b lic F u n d s— S e c u r e d ................... $ 239,718.22
O th er D e p o s its ................................ ...... 4,388,629.36
4,628,347.58
$5,282,820.74
S e c u r i t ie s D e p o s i t e d w i t h F e d e r a l R e s e r v e B a n k a n d U . 8 . G o v ’ t , t o s e c u r e
P u b lic F u n d s , a s r e q u ir e d b y la w .

C a r r ie d on
P a r V a lu e
B ooks
U. S. 4th 4 !4 L ib e r t y .................... 1933-38
270,000.00
272,495.00
C ity o f O m ah a 4%
............... 3-1-1936
5,000.00______ 5,000.00
T o ta l ................... ................................................ 275,000.00
277,495.00

M ark et
V a lu e
278.100.00
5,100.00
283.200.00

L IV E STOCK N A T IO N A L B A N K
O M A H A
This Bank H as N O Affiliated Companies
M e m b e r o f F e d e r a l R e s e r v e S y ste m an d O m ah a C le a r in g H o u s e A s s o c ia t io n


https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

O m aha, B a n k o f F lo r e n c e
O m aha, D o u g la s C o u n ty B a n k
O m aha, S ou th O m ah a S a v in g s B a n k
O m aha, U n io n S ta te B a n k
Ord, N e b r a s k a S ta te B a n k
O sh k osh , N e b r a s k a S ta te B a n k
O x fo r d , S e c u r ity S ta te B a n k
P a lis a d e , F r e n c h m a n V a lle y B a n k
P a lm e r, P a lm e r S ta te B a n k
P a lm y r a , B a n k o f P a lm y r a
P anam a, B an k o f P anam a
P a p illio n , B a n k in g H o u s e o f A. W . C la r k e
P a w n e e C ity , C itiz e n s S ta te B a n k
P a w n e e C ity , F a r m e r s S ta te B a n k
P a x to n , B a n k o f P a x to n
P e n d e r, P e n d e r S ta te B a n k
P h illip s, B a n k o f P h illip s
P ie r c e , C on e s S ta te B a n k
P ilg e r , P ilg e r S ta te B a n k
P la in v ie w , P la in v ie w S ta te B a n k
P la tts m o u th , F a r m e r s S ta te B a n k
P la tts m o u th , P la t ts m o u t h S ta te B a n k
P ly m o u th , F a r m e r s S ta te B a n k
P o lk , C itiz e n s S ta te B a n k
P o tte r , P o t t e r S ta te B a n k
P r a ir ie H om e, F a r m e r s B a n k
P ra g u e , B a n k o f P r a g u e
P r o s s e r , P r o s s e r S ta te B a n k
P u rd u m , P u r d u m S ta te B a n k
R avenna, R aven n a B an k
R e p u b lic a n C ity , C o m m e r c ia l S ta te B a n k
R ic h la n d , R ic h la n d S ta te B a n k
R is in g C ity , S ta te B a n k
R iv e r d a le , S ta te B a n k o f R iv e r d a le
R oca, B an k o f R oca
R o c k fo r d , R o c k f o r d S ta te B a n k
R o c k v ille , F a r m e r s S ta te B a n k
R o s e la n d , R o s e la n d S ta te B a n k
R u lo , B a n k o f R u lo
R u s h v ille , U n io n B a n k
St. L ib o r y , St. L ib o r y S ta te B a n k
St. M a ry , C itiz e n s S ta te B a n k
Salem , B a n k o f S alem
S a rg e n t, F a r m e r s S ta te B a n k
S crib n er, F a r m e r s S ta te B a n k
S en eca, S to c k m e n s B a n k
S h elton , F ir s t S ta te B a n k
S h ic k le y , S h ic k le y S ta te B a n k
S h u b ert, C itiz e n s S ta te B a n k
S ilv e r C reek , F a r m e r s S ta te
S m ith field, F a r m e r s S ta te
S ou th S io u x C ity , N e b r a s k a S ta te B a n k
S p a ld in g , S p a ld in g C ity B a n k
S p en cer, S p e n c e r S ta te B a n k
S p r in g v ie w , S to c k m a n s B a n k
S ta m fo rd , S ta m fo r d B a n k
S ta p le to n , B a n k o f S ta p le to n
S teele C ity, F a r m e r s S ta te B a n k
S tella , S ta te B a n k o f S te lla
S tr a tto n , C o m m e r c ia l B a n k in g Co.
S tr o m b e r g , S tr o m b e r g B a n k
S um ner, S e c u r ity S ta te B a n k
S un ol, F a r m e r s S ta te B a n k
S u p erior, F a r m e r s S ta te B a n k
S u p e rio r, S e c u r ity S ta te B a n k
S u rp rise, S ta te B a n k o f S u rp rise
S u tton , S u tto n S ta te B a n k
S w a n to n , B a n k o f S w a n to n
T a b le R o c k , S ta te B a n k o f T a b le R o c k
T a lm a g e , B a n k o f T a lm a g e
T a lm a g e , F a r m e r s S ta te B a n k
T e cu m s e h , J o h n s o n C o u n ty B a n k
T e k a m a h , B u r t C o u n ty S ta te B a n k
T hayer, T h a yer B an k
T h e d fo r d , F arm iers S ta te B a n k
T re n to n , C itiz e n s S ta te B a n k
T re n to n , S ta te B a n k o f T r e n to n
T ry o n , T r y o n 'S ta te B a n k
U ly sses, U ly s s e s S ta te B a n k
V a le n tin e , N e b r a s k a S ta te B a n k
V a lp a r a is o , O a k C r e e k V a lle y B a n k
V ir g in ia , C itiz e n s S ta te B a n k
W a co, F a rm ers and T ra d ers B an k
W a h o o , W a h o o S ta te B a n k
W a lla c e , C itiz e n s S e c u r ity B a n k
W a lla c e , F a r m e r s S ta te B a n k
W a u n e ta , W a u n e ta F a lls B a n k
W e e p in g W a te r , N e b r a s k a S ta te B a n k
W e llfle e t, B a n k o f W e llfle e t
W e s t P o in t, F a r m e r s a n d M e rc h a n ts B a n k
W h itm a n , F ir s t S ta te B a n k
W ilb e r , B a n k o f W ilb e r
W ilb e r , W ilb e r S ta te B a n k
W ils o n v ille , W ils o n v ille S ta te B a n k
W o lb a c h , P e o p le s S ta te B a n k
Y o r k , F ir s t S ta te S a v in g s B a n k
Y u ta n , B a n k o f Y u ta n

New in Nebraska
A . E. M cLarnan, for the past twelve
years with the investment department of
the Bankers Reserve Life Company,
Omaha, has become associated with
ja ck le y -W ie d m a n & Company, Des

Central Western Banker, August, 1933
M oines municipal bond house, as of
July 1, W infield C. Jackley, president,
has announced. A temporary office has
been opened at 1313 First National

19
Douglas-Sarpy Meeting
A t a meeting of the Douglas-Sarpy
County Bankers association, B. C.
W hitm ore of Valley was elected presi­
dent of the organization succeeding
George Hedelund of Kennard. Other
officers elected were W . F. Ruzicka,
cashier of Douglas County bank at Ben­
son, vice president, and R. H . H all of
Bank of Florence, reelected secretary
and treasurer.

Group 2 Meeting
F R ID A Y

E V E N IN G ,

AUGU ST

11 T H

H o tel Pathfinder
FREM ONT
(D inner, 6:15 p.m .)

Personnel Changes
John Frederick, Jr., who has been
cashier of the Farmers State bank of
Callaway since its organization in 1906
and Geo. E. Frederick, employed at the
bank as assistant cashier since his grad­
uation from the Callaway High school,
have retired from the bank. John Frederick, Jr., has accepted employment with
the Live Stock Commission Co. at
Omaha, with whom W . L. Frederick is
associated. Geo. E. Frederick is still un­
decided whether he w ill accept an o f­
fered position in Omaha.
A. E. M cL ar nan

Selling Farms
Bank Bldg., Omaha. M r. M cLarnan
will be in charge of the company’s busi­
ness in Nebraska.
M r. M cLarnan has been a resident
of Omaha since his birth. H e is a mem­
ber of the B. P. O . Elks, Omaha Cham­
ber of Commerce, and for a number of
years was active in Ak-Sar-Ben.
In addition to the Omaha branch office, Jackley-Wiedman & Company
maintain representatives at Cedar Rap­
ids, Chariton and M ason City in Iowa.

A ccording to H . O . Loutzenhiser and
G . W . Hunter of the real estate depart­
ment of the Federal Land bank of
Omaha, 220 farms have been sold by.the
bank already this year in contrast to 350
farms sold for the entire year in 1932.
As many as thirty prospects are calling
at the office daily and as many as seven­
ty-five mail inquiries have been received
in one day, the men said. In many cases
cash payment has been made for the
farms sold this year.

Land Bank Loans
Loans totaling $3,571,600 for 799
borrowers were approved during the
month of June by the Omaha federal
land bank, according to Vice President
John Carmody. D uring the month 311
loans were completed and a total of
$1,249,100 paid out to farmers in Iowa,
Nebraska, South Dakota and W yom ing.
Practically all of the money went to
small farm operators, the loans averag­
ing $4,000 apiece. T h e rate of interest
to the small borrower is 4 p 2 per cent.
M r. Carmody said 60 new national
farm loan associations are being organ­
ized in the district to cooperate to the
fullest extent in the reconstruction pro­
gram. F or the purpose of speeding the
work, a force of field appraisers has been
increased seven times those formerly em­
ployed.

Ample Funds
Concrete evidence of the noticeable
improvement in conditions in Columbus
and its business territory is evidenced in
the statement of the Central National

Group Meeting
Members of groups four and five of
the Nebraska State Bankers association
held their annual meeting in Minden
recently.
T erritory in the two districts includes
the area along the Burlington and Union
Pacific railroads from Grand Island to
the state line.
E. C. W o o d of Bartley, president of
the organization, presided at the meet­
ing. M oritz Aabel of Bertrand is sec­
retary of the group.

Hovey Resigns
Resignation of Ford E. Hovey, chair­
man of the board of directors of the
Stockyards National bank, Omaha, was
accepted at a recent board meeting, ac­
cording to W . H . Dressier, cashier. T he
vacancy will not be filled, since J. B.
Owen, bank president, w ill continue in
a dual capacity. M r. H ovey is now in
Kansas City.

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Federal Reserve Bank of St. Louis

W e KNOW NEBRASKA
O u r K N O W LE D G E of Nebraska and its
industries has been gained by years of
experience. It is detailed and authoritative.
As a correspondent bank you would have
access to this wealth of accurate information.
May we have an opportunity to show you
how efficiently we can serve you ?

Continental National Bank
LINCOLN, NEBRASKA
Affiliated with N o r th w est B anco rpo ratio n

Central Western Banker, August, 1933

20

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bank at the call of the national comp­
troller, which showed resources over a
million and a quarter dollars and depos­
its of over a million.
O f particular note is the fact that the
Central National has built up a cash
reserve of $413,250.01 since the first of
the year, when the cash reserve totaled
$215,598.10. Officers and directors of
the bank are taking justifiable pride in
this one item, since it places the institu­
tion in a position to take care of the fi­
nancial demands of the community.

braska recently was attributed by State
Sheriff Endres to the popularity of the
kidnaping racket. T h e practice of keep­
ing only small sums on hand in country
banks, and then penalties imposed re­
cently for bank robbery.
“ Kidnaping’s more profitable,” he
said. “ T o o many people are getting shot
full of holes in bank robberies. T h e y ’ve
occurred in other states recently but not
here.”
Nebraska’s last bank robberies were
April 4 and April 7 at Fairbury and
Central City, respectively.

Optimistic
Bankers throughout Nebraska are op­
timistic regarding this year’s future corn
crop since the recent heavy rains, Ray
R. Ridge, vice president of the Omaha
National Bank, said recently. M r. Ridge
recently returned from an inspection
trip through Nebraska and W yom ing.
“ Letters received every day show the
farmer and the sheep rancher are more
optimistic today than in several years,”
M r. Ridge stated. “ In W yom ing the
price of w ool has given a new impetus
to those who run huge flocks of sheep.

Increase in Lincoln
Statements of L incoln’s four national
banks, issued in response to a national
bank call, showed total deposits as of
June 30, 1933, of $23,411,686.
T h e figure, banking officials said rep­
resents a gain of $2,888,862 over total
deposits in the four banks on December
31, 1932.
T h e call issued was the first since the
banking holiday in M arch.
Loans and discounts for June 30,
1933, showed a total of $7,853,974, or
drop of $1,520,802 from the total of
$11,180,527 on June 30, 1931, and a
a drop of $3,326,552 from the total of
$9,374,777 on December 31, 1932.

Fewer Holdups
A dearth of bank robberies in Ne-

Omaha Deposits
Omaha bank deposits at the close of
business June 30 totaled $80,266,052, a
gain of approximately $4,500,000 over
deposits of January 1 and an increase of
approximately $700,000 over figures for
a year ago. T o ta l loans June 30 were
$30,381,784. T his was a decline of $2,700,000 since the first of the year and of
$7,500,000 compared with last year at
the same time.

Seek New Quarters
T h e Omaha Federal Land bank, the
Federal Intermediate Credit bank and
the farm loan commissioner are negotiat­
ing for a lease on practically all of the
nine-story Bankers Reserve L ife build­
ing in Omaha.
T h e lease, if signed, w ill be for five
years, with a five-year renewal clause.
T h e building contains 45,000 square feet
of floor space.
None of the organizations involved
in the deal has a lease on its present
quarters, and the business of the various
groups has increased to such an extent
that the present quarters are considered
inadequate.
Negotiations for the new lease are be­
ing conducted by D . P. Hogan, presi­
dent of the Federal Land bank, and Bert
W addell, agent of the farms loan com­
missioner.

C entral T y p ew riter E x c h a n g e , Inc.
(EST. 1903)

N E W AND REBUILT TYPEW RITERS, ADDING MACHINES, CHECK
W RITERS — FULLY GUARANTEED.
REBUILT MIMEOGRAPHS, STENCILS AND INKS
LOWEST PRICES

ALLEN-WALES
1820 Farnam St.
•3*

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Federal Reserve Bank of St. Louis

THE FINEST “ H EA V Y DUTY”
ADDING MACHINE MADE

Omaha, Nebraska

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County Meeting
T h e Osage County Bankers associa­
tion which met in Osage City, was at­
tended by fifty bankers and their wives.
A seven o ’clock dinner was served. T he
hosts were W . P. Randall, M rs. V . E.
Underwood, Leon W illiam s and Irving
Youngberg of the Citizens State Bank;
A. R. W allace, assistant receiver of the
Farmers State bank; M . A . Limbocker,
president of the Citizens National bank
of Emporia, was the principal speaker of
the evening. Follow ing the dinner and
program, the visitors enjoyed the Radio
Review program at the auditorium.

Electric Lock
T h e front door of the Farmers and
Merchants State bank of La Crosse has
been equipped with a new electric lock,
which is just about the latest thing of
its kind. T h e lock operates by electric
buttons within the bank, and any em­
ploye of the bank can unlock the front
door at will, simply by pressing the but­
ton. T h e electric lock is a convenient
and useful contrivance and a modern in­
vention which is worth while.

Named President
Harold C. Bodley was elected presi­
dent of the Bank of Commerce, Chanute, at a special meeting of the board
of directors, to succeed the late Neil S.
Jones.
M r. Bodley assumed his new duties
at once. H e has been a member of the
board of directors and one of the vice
presidents since the merger of the Peo­
ples Hom e State bank and the Bank of
Commerce in 1928.
T h e death of M r . Jones also created
a vacancy on the board of directors. T h e
board announced the election of Harry
B. W illiam s of the Petroleum Products
company to the directorate.
Other directors are M ilo T . Jones,
W . H . Riley, W illiam Gough, G . E.
Bodley, T . R. Evans, E. L. Freeman,
and F. L . Breyfogle.

Deposits Increase
T h e condensed official statements of
the Citizens National bank and the First
National bank, Anthony, of $1,130,134,64 which is $236,222.96 more than
the total of $893,911.68 on deposit in
the two banks at the close of business on
December 31, 1932.

21

Central Western Banker, August, 1933

This increase in deposits of $236,222.96 is possibly an expression of re­
newed confidence in the local financial
institutions since the first of the year.
T h e combined capital stock of the two
banks is $175,000 and the combined re­
sources at the close of business on June
30 are listed at $1,501,336.75 as com­
pared to $1,267,690.96 at the close of
business on December 31, 1932.

To Move
T h e State Savings bank, Topeka, will
move from its present location at 601
Kansas avenue on November 1. N ew
location of the bank has not been select­
ed, although officials are inspecting sev­
eral possible sites, it is understood.
T h e State Savings bank was organ­
ized September 1, 1898, and for several
years maintained banking quarters at
620 Kansas avenue. About thirty years
ago, the bank was moved to its present
location at 601 Kansas avenue and has
been continuously in that building to
the present time.

Deposits Gain
W ich ita’s five national banks show a
decided increase in deposits since the last
bank call by the comptroller of the cur­
rency. T h e total increase in six months
is $1,011,683.73.
T h e report made as of June 30,
showed that the five banks have deposits
totaling $33,569,735.76. O n December
31, last, the occasion of the last previous
call, the total was $32,558,052.03.
T h e national banks of W ichita never
made a better showing than at this time,
and all of them are much pleased with
the reports they have been able to make
to the comptroller.
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State Officers
J. H . Bloedorn, head of the Farmers
State bank of Fort M organ, was elected
president of Colorado State Bankers as­
sociation in recent convention.
Jefferson Flays Davis, vice president
of First National bank of Colorado
Springs, was elected vice president; S.
J. Rhodes, president of Fort Lupton
State bank, treasurer; R. W . Joslyn,
Boulder Mercantile Bank & T rust Co.,
chairman of the state bank section of the
association; C. L. Stout, Ft. Collins,
state vice president of the American
Bankers association; W . E. Hickman,
W indsor, vice president of American

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Federal Reserve Bank of St. Louis

Bankers association for national divi­
sion ; W illiam W hile, Erie, vice presi­
dent for savings bank division; Hugh
Gleason, Burlington, vice president for
state bank division.

T h e depositors have agreed to waive
47 per cent of their deposits at the start
in order to give the new venture im­
petus, but the waiver is not to be of a
permanent nature.

Home Loans

Meet in Denver

Loans totaling $573,000 have been
made to Colorado home owners by the
Federal Home Loan bank of Topeka,
Kansas, O . A . King, Denver member
of the board of directors of the bank
said recently.
A he loans have been made to home
owners as far west as Grand Junction
and Durango. T hey all have been
th rough building and loan associations
affiliated with the bank.

Directors of the Federal Home Loan
bank of the tenth district came to D en­
ver for their monthly meeting July 17,
preceding the two-day conference of the
Southwestern States Building & Loan
league there July 18 and 19.

Elected President
A . J. T urn er was elected president,
Roy L. Hinman, cashier, and Byron
Totten, assistant cashier, of the First
National bank of Canon City at a meet­
ing of the board of directors.
A . E. W ilson was elected to the board
of directors, to fill the place of the late
revered W . H . Dozier, to whose office
as president M r. T urn er succeeds.
T h e board now comprises L. G . Carl­
ton, L. W . Eelter, W . H . T rout, A . J.
T u rner, and A . E. W ilson.

Heads Bank Board
M ayor George G . Birdsall was re­
cently elected chairman of the board of
directors of the Colorado Savings bank,
Colorado Springs at a meeting of the di­
rectors. H e takes the place left vacant by
the death of E. J. Eaton a year ago. M r.
Birdsall will take an active part in the
bank s affairs, although continuing as
partner in the Birdsall Stockdale M otor
company, which he founded in 1919.
M ayor Birdsall is now serving his
third term on the city council, being
twice reelected to six-year periods after
serving a four-year term when the man­
ager form was put into operation here.
H e was first elected mayor in 1929
by the council and has continued to oc­
cupy that post since then, being reelect­
ed for his third term last April.

New Bank
T he fact that M elvin Springer, pres­
ident of the Colorado Bank & T rust
company of Delta, and associates, have
made arrangements to take over the
First National bank of Paonia, provided
approval can be secured from the Recon­
struction Finance corporation, has been
received with much satisfaction.

Modified Rates
on A ll Classes
of R ooms
400

ROOMS
WITH
BATH

fro m

More than 150 Rooms Priced at
$2.50 and $3
Omaha’s l a r g e s t and finest
hotel, the center of business,
social and travel activity. Ex­
cellent food in the beautiful
main dining room, and popular
Indian Grill.

Operated by E P P L E Y H O T E L S

CO.

& ; ■.

Central JVestern Banker, August, 1933

22
Directors of the Home Loan bank
are: W ild er S. M etcalf of Lawrence,
Kan., W . R. M cW illiam s of O kla­
homa City, Charles W . Thom pson of
Topeka, C. C. Gates of Denver, A . U.
Thom as of M cAlester, Okla., L. E.
Roush of W ichita, C. T . Rice of Kan­
sas City, G . E. M cK innis of Shawnee,
Okla., L. C. Pollock of Bartleville,
Okla., David Row e of Fremont, Neb.,
and O . A. King of Denver.

Good Position
Banks of Colorado Springs in their
report of condition as of June 30 to the
comptroller of currency show that re­
gion in an enviable position in spite of
the 10-day suspension of business during
the “ bank holiday” in M arch. T h e total
on deposit in the five reporting banks
was $15,227,604.83, as compared to
$15,259,694 for the same period a year
ago. T here has been no call since D e ­
cember.

Bank Reopens
T h e United States Bank of Grand
Junction opened its doors June 29 for
an unrestricted business. T h e bank
opened with cash reserves totalling near­
ly 400 per cent above the legal require­
ments. A t the same time all of the liquid
bonds and other resources remain abso­
lutely unpledged.
T h e resumption of normal banking
conditions, the reopening of this long es­
tablished bank on a basis of unquestion­
able soundness, means much to the
Grand Junction community in the way
of improved business confidence.

PUBLIC R ELATIO N S —
A N IM PORTANT JOB
(C o n tin u e d fr o m p a g e 10)

man drops dead? T h e loan value on a
policy has reserves behind it. W o u ld n ’t
the Federal Reserve and some insurance

companies listen to an idea that would
give banks a new advertising story to
tell?
Eliminate Statistics

W hen we attempt to keep M a cD o n ­
ald interested or get him interested, let’s
not try to feed him too many statistics.
I never heard anybody ask a public
speaker, “ Please, M r., give us one more
statistic.”
But if we must have one,
let’s take the follow ing one. A great
many people fear that we are going into
something called inflation, which one
must be for or against on demand. Are
you for or against inflation? they say—
and one is supposed to speak up quick.
Let some banks tell people that we had
inflation in 1929. T h a t in 1913 bank
deposits or money we used was 17 bil­
lion— -that by 1929 it had gone to 65
billion, only 18 billion of which was due
to the war.
T hat there was a 320 per cent in­
crease in turnover of transactions —
money in use—-as against a 57 per cent
increase in the same period on produc­
tion of goods. W e had our inflation.
T e ll the public not to fear it now be­
cause we are trying now only to get on
a level place where we can rest for a
moment and get out of the deep valley
we fell into.
A New Day

T here is a dawn across the hills.
A true vision, the same that our fore­
fathers had, leads us on. And “ where
there is no vision the people perish.”
Those of us who have the privilege to
live now, and who are called to that
crusade, that hard journey, know that
the troubles we face, mark, not the end
of the world or the breakdown of civil­
ization, but the end of stupid folly. Ours
is the opportunity to take a real and ac­
tive part in one of the greatest decades
in all history.

W e need only the vision to see it, the
fortitude to share in its new adventures.
T here is no standing still for nations
or individuals in the times that test
men’s courage.
It is our lot again to start as those
others started in days long buried. W e
must live gloriously and courageously or
be left behind. M en who live in a great
age must dare greatly. W e are, each of
us, put now to the test. It is the time
of the great crusade and of the great
showdown.
T h e real leaders of business w ill step
up to take the places of those whose clay
feet broke when they left their big chairs
and were forced to walk.
T h e place we seek across the rivers
and mountains of doubt, is a fair land
for fair people. It requires a race actu­
ated by a great common purpose, bigger
than any one man, greater than the
greed which one passed for ability.
It is worthy of every effort for the
man who finds himself starting all over
again after he thought he was safe. He
gathers together the few things he has
left, looks them over, throws some away,
regrets no losses, marches on. Those
others who came from the far-flung
towns of the world started all over
again. Can we do less?
Those who gave their names to us
know that we, each one of us, now have
the courage to carry forward the torch
they handed us. It was the cowards who
never started. It was the timid and the
disheartened who turned back.
T hey
never came to America.
T h e cowards w on ’t start now.
L et’s get moving— now, this day, this
hour.
T h e past is dead and gone, the future
is this minute lengthened by our own
effort. W e start now toward the dawn
across the hill, with Faith in our souls.

A U S T R A L A S IA

BANK OF N EW SO U T H W ALES
E S T A B L IS H E D
(W ith

1817

w h ic h a r e a m a l g a m a t e d T H E W E S T E R N A U S T R A L I A N
a n d T H E A U S T R A L I A N B A N K O F C O M M E R C E L t d .)

P A ID -U P
C A P IT A L
.................................................................................................... £ A
R E S E R V E F U N D ............................................................ .....................................................
R E S E R V E L I A B I L I T Y O F P R O P R I E T O R S ...............................................

BANK
8 ,7 8 0 ,0 0 0
6 ,1 5 0 ,0 0 0
8 ,7 8 0 ,0 0 0

£ A 2 3 ,7 1 0 ,0 0 0

Aggregate Assets 30th September, 1932, £A 107,525,115
A G E N T S __ F I R S T

N A T IO N A L

BANK, OM AHA, N EBRASKA

H EAD OFFICE, GEORGE ST., S Y N D E Y


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Federal Reserve Bank of St. Louis

GENERAL

M ANAGER, ALFRED

CHARLES

D A V ID S O N

LONDON OFFICE, 29 T H R E A D N E E D L E ST„ E. C.

7 1 0 B r a n c h e s a n d A g e n c i e s in A l l A u s t r a l i a n S t a t e s , F e d e r a l T e r r i t o r y ,
N e w Z e a la n d , F i j i , P a p u a , M a n d a t e d T e r r i t o r y o f N e w G u in e a a n d L o n d o n

2

2

n d

IN

H O «

P R O D U C T I O N
E very twelfth slice o f bacon eaten in the
United States comes from a hog that was
farrowed on a Nebraska farm. Hams from
Nebraska, under America’s most famous
brand-names, delight epicures around the
world.
Soon after the sturdy pioneers first broke
the virgin soil o f Nebraska, hogs became an
important source o f farm income for this
state. Today Nebraska is second among the
states in hog production.
For 77 years this bank has devoted its best
energy and its full ability to helping Omaha
and Nebraska develop— in industry and
agriculture. In 18 56 we started. Today we
stand ready to serve you as the oldest and
one o f the strongest banks in Nebraska.

United States National Bank


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Federal Reserve Bank of St. Louis

“ N E B R A S K A ’S O LDEST B A N K ”
Affililated with N O R T H W E S T B A N C O R P O R A T IO N

This is one of a series of advertisements appearing in national publications,
featuring the territory served by the Northwest Bancorporation


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