Full text of Central Western Banker : July 1930, Volume 25, No. 7

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

The Investment Policy of Small Banks

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

Page 9

“Whom Shall I Say
Wants to See Him?”

IS TABOO
at our Bank
Cordial officers greet you at our bank . . .
and no secretary or clerk bars your path.
You need not give your name or state your
business to be granted an interview.
No one asks for your card, nor
inquires, “Who shall I say wants
to see him?”
Easy access is one of the features of our
friendly institution. W e welcome your
visits to Omaha and to our bank.

Nebraska’s Oldest Bank


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

3

a s t> [
irffnute-

J 3?

sinks

Y

send Thinkers
T H E CUMMINS & MORRISON
*- COMPANY, I N C., investment
bankers of Des Moines, Iowa, has
been admitted to membership in the
Omaha Stock Exchange. Officers of
the organization are R. W. Morrison,
President; James A. Cummins, vice
president and Lena L. Black, secretary-treasurer.
--------A WARNING against fraudulent
A brokers and promoters for offering stock in foreign Ford Motor Companies was issued recently by the Bet-1-,
-p,
r T/ , A
•
te r B u s in e s s B u r e a u o t D e tr o it m

con-

junction with a national Better Business Bureau and affiliated offices
throughout the United States and
La? a, ;a‘
,
,
,.
Relying on the good will and mtegrity of the Ford name thousands of
persons throughout the country have
purchased stocks which either turned
out to be spurious or were not delivered at all. There is no way of estimating the financial loss involved.
-------- 8

11 IT

lb IN 1

IY

s e e in g

to u r ,
a

an

e v e n in g

d in n e r

and

a theatre party. The
Newr York visit was an
original and unique feature of the 39th annual
convention of the Georgia Bankers Association
and the Georgia Fiduciaries Association held
j o i n t l y at Savannah,
Georgia.
The business sessions
in Savannah were coneluded the afternoon of
the 7th and the group
sailed for New York in
t h e e v e n in g - o n th e S
S
m e e v e n i n g u il m e O . O .
C ity
Ot
B ir m in g h a m .
T he

to u r w a s


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

E n g la n d C o u n c d a t its m e e t in g m
,
h 0
b
la n d S p r in g s , M a in e .

P o-

8 ._____
r IKENING THE CONSTANT inL , terplay of force jn tpe world’s
money market to the relative movemerds of the planets of the solar sysj-eny j 0qn pr Rovensky, vice chairman
0f Tpe Bank of America N. A., New
York, and past president of the Stable
Money Association, addressing the
Robert Morris Associates at the Harvard Club, declared that similarly the

interest rates within the country move
in relation to one another while the
country’s money market moves in relation to world money markets. Mr.
Rovensky declared that there are
three distinct movements of the
money market: that of the entire
world structure; that of the relative
positions of the various countries; and
that of the other component parts of
each country’s money market.
"The rates of interest prevailing at
a given time m the money market of
any one country vary widely for a
num ber o f good
a n d s u ffic ie n t r e a >> it/r
r „ •j
M r . R o v e n s k y s a id .
t h e y a ie

son s,

governed by the maturity of the loan ;
the nature of the collateral or risk;
the liquidity of the loan (i. e., the
comparative certainty of its payment
at maturity, as differentiated from the
certainty of its ultimate payment) ;
the relation of the borrower and the
lender; the expense of operating the
loan (i. e., the work involved in connection with the loan) ; the lag that
exists in the transfer of money from
one part of the money

uiiMiiiiiiiimimimiiiiiiiiiiiiiiiiiiiimmiiiiiiiiMiis;immii!iimii:miiHiiimii:!iiimimimiiimMiiiiiimiiHimiiiiiiiiMiimiiiiiiiimiMuiiiniiiimiimmiiimiiiiii!uiiiiiiiiiiimiiiiiiiiii

HANOVER BANK
and Trust Company on
June lOth, entertained
176 Geoigia Bankeis
with an afternoon sightr e c e p tio n ,

sponsorship and leadership of Gordon
L. Groover, retiring president of the
Georgia Bankers Association and vice
president of the Citizens & Southern
National Bank, Savannah. He was
assisted by H. F. Pelham, president
of the Georgia Fiduciaries Association
and vice president of the Citizens &
Southern National Bank, Atlanta.
--------^ A R D N E R B. PERRY, vice presi* dent of the Northwest BancorPora,tlon ot, Minneapolis, was guest
speaker on June 14th before the New

u n d e r th e

.
„ rVo]- 25>No- 7

Ttttv 1AOa
JULY, I9o0
r
l Tl

r~r'l *
l lilS

J
l S S ll C

lTT3.rlvCt tO a n o t h e r

^TIt CSC

factors cause a wide var;ety of interest rates to
exist side by side in each
country and while there
is a constant interplay
of forces that t e n d s t o _

Last Minute News
3
Striking at E state S h r i n k a g e ............................... .........
4
,
r p la W
¡ .¡ u
The ABC’s of Group B a n k i n g .................................... 5
.•
,, ,
, ,
,,
W hat Is Savings Advertising? . . . . . . . .
6 num’ e ci'^
16
Legal D e p a r t m e n t ......................................................... 7
response of other rates
Bonds and Investm ents ...................................................... 9 l() a change in the tacI n s u r a n c e ..........................................
.1 5
tols 111 anT one _oi moie
19 Pai'ts of the entire marNebraska N e w s ...............................
News of the Omaha S to c k y a rd s................................... 23
^:etSouth Dakota N e w s ..........................................................27
“There are numerous
Utah N e w s .............................................................................. 27 hybrid forms of financColorado N e w s .................................................................... 28 ing. One of the most
New Mexico N e w s ..........................................
29 important of these is the
Kansas N e w s .....................................................
30 acceptance market. Born
^ = = = = ^ = = = ^ ^ ^ ^ = = = = = = ^ =^ ^ = ==^ =^ = = = =
of the Federal Reserve
Act in 1914, we are still
T h e C en tr a l W ester n B a n k e r , O m a h a
experimenting with it
P u b lish ed m o n th ly at 410 A rth u r B ld g ., O m aha, N eb raska
S u b scrip tio n . 25 cen ts per co p y ; $2.00 per year.
E n tered as secon d -class m atter at the O m aha postoffice.

U
tr ia l an rl p r r n r
DT T lle t n a l 2111(1 e n Q 1
m e th o d . T h e flllld a m e n -

iiiiiiiiiitiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii.
iilllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll||||||||||||||ill||!ll|||||||ll|||||i||||||||||||.|||||||||||!||||i||||||||||||||||||||lillllll|||||liilll|||||||||||||lllllllllllllllllllllllllllllll(

ta l m o n e y

m arket

is t h e

Central Western Banker, July, 1930

4

LAST MINUTE NEWS
(Continued from Page 3)

world market •— all others are rela­
tive.-’
P LECTION OF RALPH HAYES
as vice president of the Transamerica Corporation, international
bank holding company, has been an­
nounced. Hayes will assume his new
post immediately, moving his offices to
the Bank of America Building. Prior
to his association with the New York
World, Hayes was vice president of
the Chatham Phenix National Bank
and Trust Company.
I

W. BALDWIN, president of the
Missouri Pacific road, has been
elected chairman of the Denver & Rio
Grande Western, controlled jointly by

O PEAKING at a recent Conference
of Life Underwriters, Edward M.
McMahon, Insurance Trust Officer of
The Equitable Trust Company of
New York, declared that “the shrink­
age of income at death is a far more
serious problem than capital depreciation of estates.” Mr. McMahon dis­
cussed this point in an address on the
subject — “How the Equitable Tiust
Company of New York Is Cooperat­
ing with Life Underwriters.”
“In this work,” stated Mr. McMa­
hon, “it is necessary to consider five
interests: The estate builder, his heirs
or beneficiaries, the life insurance un­
derwriter, the attorney, and the trust
company. The interests of the estate
builder and those of his beneficiaries
are placed paramount.
“Estate depreciation on transfer to
heirs at death is becoming an increas­
ingly serious problem as our civiliza­
tion grows more complex. According
to the observations of Joseph S. Mc­
Coy, Actuary for the Lhrited States
Government T re a su ry Department,
each year 400,000 estates valued at
$5,150,000,000 change hands by inher­
itance. Although depreciation, when
the larger estates are settled, often
ranges from 10 to more than 30 per
cent of the capital involved, because
of expenses of last illness, cost of ad­
ministration, Federal estate inheri­
tance and transfer taxes and indebted­
ness, this situation would not be so
serious if it did not frequently result
in impairment of the income-produc­
ing possibilities of these estates. In
fact, the loss of income is always
much larger than the reduction of cap­
Central Western Banker, July, 1930


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

the Missouri Pacific and Western Pa­
cific roads and coveted by the Van
Sweringens as a link in their plan for
a transcontinental line. He succeeds
William H. Williams.
A special meeting of stockholders
of the Denver & Rio Grande will be
called to vote on the new Ven Sweringen men, who have applied to the
Interstate Commerce Commission for
permission to serve as directors. Suc­
cess or failure of the Cleveland rail­
road magnates in their plan to gain
seven of the nine places on the road’s
board may indicate whether the trans­
continental system, which will then
need only the Western Pacific, is to
be completed.
TÇXTENSION OF B R A N C H
BANKING svstems outside met­

ital because the personal earnings of
the estate owner are forever lost to
his family.”
Mr. McMahon outlined further,
“Available income to the family, in
many cases, is reduced by intensified
speculative elements resulting from
the death of a partner or chief stock­
holder in closely held business inter­
ests.”

E d w a r d M . M c M ai -i o n

The speaker urged each estate own­
er to visualize the problems of his ex­
ecutor and his trustee in advance so
that adequate provision might be made
for replacement of estate depreciation
and for reduced income occasioned by
death.

ropolitan districts was recommended
recently by Charles E. Mitchell, of the
National City Bank of New York,
before the house banking committee.
rpH O S E IN CHARGE of the or­
ganization of the convention of the
American Bankers Association, to be
held in Cleveland from September 29
to October 3, are promising an unus­
ually fine program. Complete details
have not yet been outlined but it is
understood that exceptionally fine
speakers and an entertainment pro­
gram is being arranged.
J. R. Kraus is chairman of the
committee, and is assisted by Edwin
Baxter, vice chairman; T. E. Monks,
treasurer; C. A. Paine, secretary; E.
E. Barker, J. C. McITannan, C. B.
Reynolds, and Allard Smith.

“Because many business men have
their major contacts with the credit
function of the bank or trust company
they may feel that such financial in­
stitutions consider money problems
purely from a coldly analytical stand­
point. Trust companies, however,”
emphasized Mr. McMahon, “are es­
sentially human institutions, usually
being called upon to harmonize vari­
ous conflicting interests and personali­
ties of families and to advise upon
such matters as what school should a
boy or girl attend, in what vocation
would the son specialize and similar
questions.”
In conclusion, Mr. McMahon stated
that one of the chief beneficial results
of the national cooperative movement
between trust companies and life un­
derwriters is to give clients increased
assurance of financial independence.
That financial independence is a ser­
ious problem is indicated by the re­
sult of a rather extensive survey re­
cently completed on the financial cir­
cumstances of approximately 31,500
individuals 65 years of age and over,
which showed that out of every 100
of these people, 42 were worth $5,000
or more, 13 were worth $2,000 to $5,000, 15 were worth less than $2,000
and 30 had no resources.
Trust companies can furnish sound
estate plans, the completion of which
underwriters can guarantee through
insurance, he stated. For the purpose
of creating an immediate estate, no
better method than life insurance has
yet been devised for the man desirous
of discharging his financial and moral
obligations to his family and society.

J5
'T 'H ER E IS no
A more distressing
sight than a group
of citizens, men
and women, clamoring before the
closed doors of a bank bewailing the
loss of their savings. Those losses
fall upon the best and most substantial
citizens in the community, and many
of them never recover their previous
financial standing. Multiply this local
event by nearly six thousand (being
the approximate number of bank fail­
ures in the last decade), and scatter
it through the great agricultural states
of the Union, and the magnitude of
its effect reaches astonishing propor­
tions. Gentlemen! This is the picture
that must preface any study of group
banking.
What is group banking as distin­
guished from chain banking or branch
banking ? Chain banking is represent­
ed by a common ownership, by one or
two individuals, of all or part of the
stock of two or more banks. A local
example is that of the "Kirschman
Chain that has just collapsed in
Saunders County. Chain banking by
the very nature of its ownership is re­
stricted in volume, area and geograph­
ical boundaries. Its so-called trade
ai ea is so limited that it lacks diversi­
fication of industry so necessary to the
success of the banking business, and
at the same time is susceptible to the
hazards of weather conditions.
Branch banking is typified in a
Luge bank usually located in a metro­
politan center, with offices in smaller
communities where deposits are re­
ceived and loans made, without a cap­
ital structure set-up on the books of
the branch bank.

ing dependencies
of the Nation on
its power and light
facilities.
Mergers are characteristic of the
present age and banking has been
keeping pace with industry. The basic
cause of bank mergers is a desire to
establish an organization that has the
element not only of a greater profit,
but more especially of permanent,
steady profit. Experience to date
shows that the bigger the bank the
greater, generally, is the rate of profit
over a period of years, caused more
by greater stability than sudden in­
crease. However, even a superficial
study of the group banking movement
shows that other considerations have
also entered into the situation, espe­
cially in the mid-western country. The
record of bank failures indicates that
the unit bank system has broken down
over a large area of the agricultural
and cotton growing region. An ap­
preciation of conditions in these re­
gions is necessary to properly under­
stand the group bank movement.

The ABC’s of Group

Retain Separate Identity
Group banking as we know it today,
is controlled through majority stock
ownership of a number of banks
through a holding company, patterned
corporately after modern investment
trusts, being operated as a centrally
managed institution. Banks in the
group are affiliated with the holding
company through the exchange of
shares or through the outright sale of
stock. Each retains its separate iden­
tity under local management of offi­
cers and directors and is operated in­
dependent of the group, but subject to
examination and supervision of the
holding company. The holding com­
pany takes nothing from the local
bank, but rather brings to it better
supervision, larger resources and bet­
ter management.
It does not disturb the policy, the
local officers or local directors, nor
does it interfere in any way except to


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

B y W a lte r HL D ressier
Cashier, Stock Yards National
Bank, Omaha
see that the bank is safely managed.
Group banking is of comparatively re­
cent origin, or perhaps it would be
more nearly correct to say its develop­
ment on an enlarged scale has just
begun. There are more than two thou­
sand of the commercial banks of the

W alter

H.

D ressler

United States engaged in group bank­
ing. There are over three hundred
groups, with resources of over four­
teen billion dollars, about 20 per cent
of the total resources of all banks in
the United States.
Why has group banking spread so
fast, and especially in the Middle
West? In the first place it represents
a form of banking concentration
which is the natural sequel to the un­
paralleled concentration of capital and
management in other fields of eco­
nomic activity during the past decade.
It is a recognition of the changing
conditions in the United States with
respect to the production and distribu­
tion of manufactured goods, the prob­
lem of transportation and the increas­

The “Good Old Days’’
Prior to 1920 can be considered
“The Good Old Days” in rural bank­
ing. Since the Civil War, land values
in the Northwest and Middle West
have steadily appreciated. Agricul­
tural banks loaning on real estate col­
lateral could deal almost blindly. The
increase of land values over a period
of three to five years always provided
additional collateral and safety. Farm
mortgages were as saleable as govern­
ment bonds. Since 1920 the same re­
gion has been the scene of a constant
struggle, political and economical, to
re-establish the foundations of its
basic financial structure which were
rudely jarred by the consequences of
war.
The years 1917 and 1918 had wit­
nessed a magnificent effort on the part
of the farmers of the Middle West
and the Northwest to increase the
maximum production of foodstuffs as
a part of their contribution to the Na­
tion’s war effort. Production costs in­
creased, market values rose and land
values appreciably increased as a con­
sequence. These incidents of expan­
sion were reflected in the operation of
the rural banks of the land. Much
additional land was brought into cul­
tivation. Machinery and stock to till
this new land was purchased in large
quantities at a high price. The banks
co-operated fully with the agricultural
population by the extension of new
credit which was reflected in tremen­
dously increased deposits. A large
equity in these newly developed farms
Central Western Banker, July, 1930

6
was represented in second mortgages,
held by the banks as collateral to note
loans.
With the advent of 1920, the gen­
eral price level took a sharp decline
and the reaction followed through the
entire credit structure. Country banks
serving exclusively agricultural com­
munities, and often areas dependent
upon one or two cereal crops, found
themselves confronted with drastic
deflation of values upon which their
business was based. Everyone is fa­
miliar with what happened during the
latter part of 1920, 1921, and the de­
flation period that followed. The
farm mortgage which had been the
backbone of the rural banking busi­
ness, lost its liquidity and became a
frozen asset. The rural bank had been

the principal farm loan agency and
the destruction of the market for such
loans deprived them of a large volume
of business.
The Big Factor
As we have watched the situation
develop, the factor of management in
the rural banks has thrust itself more
and more into the foreground. The
well managed bank whose officers
were in position to realize the chang­
ing conditions in the entire agricul­
tural territory, survived, where their
less capable competitors encountered
difficulties.
Between 1920 and 1929, about seven
hundred fifty National and four thou­
sand nine hundred State Banks, most­

ly small institutions, closed their
doors. In important areas the bank
pictures was strewn with wreckage of
bank failures with their consequent
loss to the business life of the com­
munity and to the depositors and
stockholders of the closed institutions.
The situation was such that the re­
maining banks dared not loan freely
to their customers for fear some
neighboring institution would close its
doors and start a run on the others.
Banking leaders in those regions
looked about for a remedy and discov­
ered group banking. In reaching their
decision, they were prompted solely
by the necessity of some form of
practical re-organization of the rural
banking structure, if the territory as
(C ontinued on page 23)

W hat is Good Savings Advertisin
NATURALLY think of sav­
ings advertising as simply featur­
ing the idea of thrift. But the attitude
of the public has changed and it is
necessary to take cognizance of this
change.
The typical thrift advertising which
banks have been using for years had
two outstanding messages to the pub­
lic— first, “You ought to save your
money in the bank,” second, “This
bank is safe.” They were directed to­
ward people who were spending all
they earned or were keeping their sav­
ings hidden because they did not think
the bank was safe or were ignorant of
the services of the savings department.
But nowadays practically everybody
today believes banks are safe, practic­
ally everybody has become familiar
with the savings department of some
bank and practically everybody knows
now that he ought to save money. So
we are no longer in our advertising
talking to a public which is not using
banks. The question today is not “Do
you have a savings account?” but
“Where do you keep your savings ac­
count?” The job is not so much to get
new savers as to get present savers to
use your bank instead of some other
bank. Savings advertising is no longer
so much a matter of education as it is
of competition.
This raises the question, “Why do
savers choose a bank?” For all practi­
cal purposes a savings account in one
good bank is just as good as in anoth­
er good bank. The main reason sav­
ings customers choose a bank is be­
cause it is the nearest or the most con­
venient. If there are two equally con­
venient, he selects the one he likes the
Central Western Banker, July, 1930

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

Address of Don Knowlton, Publicity
Manager Union T r u st C om pany,
Cleveland, Ohio, before the Eastern
Regional Savings Conference under
auspices of the Savings Bank Divi­
sion, American Bankers Association,
New York City
best. Based on this assumption, adver­
tising appeals for savings business
should stress convenience and feature
the institution as a pleasant place to
do banking.
The Emphasis Shifts
Consider advertising which has to
do with convenience and see how the
emphasis shifts as soon as this point is
considered. I don’t think that all the
purely thrift advertising in the world
can get a saver who lives two blocks
from one bank to walk instead eight
blocks to another bank. Branch banks,
therefore, in and of themselves are the
largest savings advertisements and
should be considered as such. Their
design and prominence constitute sav­
ings advertising from the standpoint
of convenience. Their main job is sim­
ply to call attention to the passerby to
the bank itself and impress upon his
mind that there is a good bank at that
location.
As to advertising which depicts the
institution as a pleasant place in which
to bank, so that a man will pick your
bank instead of some other — a man
likes a place where he will get recog­
nition as an individual and where he
feels that the bank is part of his im­
mediate neighborhood and interested
in local affairs. To that end constantly
stress the fact that branch banks are
not mere branches, but are banks in

themselves sensitive to the needs of
their communities and that branch
managers are given authority to make
their own decisions in the light of the
special needs of the customers in their
neighborhoods.
There should be considerable thrift
advertising, but not of the sort which
tried to persuade people who did not
have savings accounts to open them.
Present day thrift advertising lays em­
phasis on an effort to persuade people
already familiar with a savings de­
partment to save more money. Here
too the changing public point of view
must be taken into consideration. In
the old days many people regarded a
savings account as an end of itself.
They saved money with the intention
of keeping it in the bank. Today most
people save money for the purpose of
spending it for something—to make a
down payment on an automobile or a
home, or to invest in stocks or bonds.
The savings account has ceased being
an end in itself and has become a
means of acquiring something else.
We might as well accept this situation
and merchandise the savings account
not as an investment but as a metiiod
whereby people can get the things out
of life which will bring them satisfac­
tion and happiness.
So there is a great deal more to ad­
vertising savings than merely advertis­
ing thrift. Savings advertising should
emphasize the sa tisfa c tio n which
come from having enough money to
buy what you want rather than merely
the satisfaction of havine a balance in
the bank. But more important is the
advertising of convenience of location
and featuring the institution itself as
a pleasant place to do business.

7

Lucky Director
and the

Rights of
Company, 177 N. W. 222, the evidence
“T H E ELECTION for directors of
By
showed that Samuld F. Dobbins owned
± the Snow Bank will be held next
1,070 shares of the capital stock of the
Tuesday, according to the by-laws
Marshall Furnace Company, a Mich­
thereof,” John R. Harding suggested.
igan corporation, the par value of
“That’s right,” Director Bolster
which constituted more than two
agreed.
“Yes, but here’s the situation,” thirds of the total $150,000 authorized
“And you’ve been a director for
Harding explained, “I feel that I ’m capital stock of the Company.
quite a while now.”
Then Dobbins made a will contain­
“Ever since the bank was organ­ bound by the will—at the same time I
don’t want to make a fool of myself ing the following clause:
ized,” Bolster concurred.
“And, while I don’t like to praise a before my friends and neighbors by
“I hereby direct my said trustees to
man to himself, you’re the best man going to that meeting and voting for so vote upon the shares of stock of
on the board today — you know the George Boyer against you.”
said Marshall Furnace Company be­
“Well, it looks as if you couldn’t longing to my estate, that my two
whole ins and outs of the institution
from A to the tail of the alphabet.”
help yourself, and I’ll tell you now I ’ll sons, Dale M. Dobbins and Charles
“Thanks.”
hold no grudge against you for put­ W. Dobbins, shall be elected annually
to serve as directors of said Marshall
“And I ’d like to see you continue as ting me out of a troublesome job.”
director as long as you want the job.”
“Here’s what it boils down to. If Furnace Company, and that the by­
“Well, I ’m not seeking banking you’re nominated I ’ll vote the Boyer laws of said Company during said
honors — there’s nothing in it but stock for you—and get in a lawsuit trust period remain as now fixed, pro­
viding for a board of five directors
worry, but if I ’m elected I ’ll continue with George,” Harding objected.
qualified to serve, and
to act as heretofore,” the
who will serve, be elected
director told him.
in each year, and that, in
Cards on the Table
W h e n th e p r o v isio n s o f a w ill s e e k to c r e a te a n d d ir e c t a
the
event of the death, dis­
te s ta m e n ta r y v o tin g tr u s t fo r a fix ed p e r io d o f ir r e v o c a b ility
Harding put all his cards
qualification, or re sig n a ­
a
n
d
to
e
x
c
lu
d
e
th
e
r
e
p
r
e
se
n
ta
tiv
e
s
o
f
a
te
s
ta
to
r
fr
o
m
t
h
e
e
x
e
r
­
on the table.
c is e o f th e ir p e r so n a l ju d g m e n ts a s to th e m a n a g e m e n t o f a f ­
tion or refusal to serve of
“I ’m an executor of the
fa ir s an d to p e r p e tu a te c er ta in p e r so n s in office a n d c o n tr o l o f
any d ire c to r, an active,
last will and testament of
th e co m p a n y w ith o u t r e g a r d to th e r ig h t o f m in o r ity s to c k ­
competent successor for
h o ld e r s, it is c o n tr a r y to p u b lic p o lic y a n d v o id , th e c o u r t h a s
the late Allen B o y e r,”
such director shall be im­
d
e
c
la
r
ed
.
Harding explained.
............................................................................... .................... mu mediately chosen, and that
“Yes—that’s one of our
the directors as such shall
shareholders who was at
receive no salary, and that
the last meeting and he’ll
my
said
trustees
so far as lies within
“Well,
you’ll
have
to
run
your
own
be absent Tuesday,” Bolster agreed.
their power through control of the
risk
on
that.”
“And the Boyer estate and its hang­
membership of said directors, shall see
His Proposition
ers-on control a majority of the stock
to it that no person connected with
of the Snow Bank.”
“Here’s my proposition,” Harding said company shall receive any salary
“I believe they do.”
averred. “You announce that you can’t not reasonably proportionate to the
“Now, there’s a peculiar clause in continue as director on account of value of the services by such person
the Boyer will that’s probably never pressing private business, or some­ actually rendered in said company.”
been called to your attention,” Hard­ thing along that line. That’ll give me a
After His Death
ing went on, “and it directs the execu­ chance to vote the Boyer stock for a
After
Dobbins’
it became ne­
tors to vote the stock of the Snow plain fool without making an abso­ cessary to increase death
the
capital
stock of
Bank so that his son George shall be lute one of myself, and save me from the corporation from $150,000 to
going
down
in
local
history
as
the
man
elected a director of the bank, and
$300,000, but to adopt the resolution
shall be retained in office during the who put Bolster off the board after of increase a vote of two-thirds in in­
giving
the
best
years
of
his
life
to
term of his natural life.”
building up the bank to a position sec­ terest of the capital stock was re­
“Then may the bank commissioner ond to none in the country. What do quired, and Dobbins’ executors were
be merciful to us,” Bolster averred.
afraid to vote for the increase which
you say?”
“I feel just the way you do, and I
But the director didn’t retire—Hard­ would put the estate in a minority and
know more against George than you ing voted for him ; George Boyer prevent them from carrying out the
do, but there’s the will.”
made no trouble, and there was a rea­ quoted provisions of the will.
Then the executors applied to the
“Well, I don’t see where it’s my fu­ son, as the advertisements say.
(C o ntinued on page 14)
In the case of Billings vs. Marshall
neral.”


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

The Legal Editor

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiiiiiiiiiiiniiiiiiiniiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimiiiiiiiiiit :iiiiiniiMiiiimmi

iiiiiiiiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiiiiiiniiiiiiiiiiiiiimiimmiiiiiiiiiiiiiMiiiiiiiiiiimiiiiiiiiiiiiiiiiiiiHiiiiimiiiiiiiiiiMiiiiiiiiimiiiimmiiimi

iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiHiiiiiiiiiiiiiiiiiiiiiiiiiiHiiiniHiiniiitniiiiimiiiiimmiiiiiiiiii:imiiiiiiiiiiiiiiiiiimmmiiiiiiiiiiiiiiiiiii

Central Western Banker, July, 1930

8

F o r Your Ju ly I n v e s t m e n t s
Buy Surety Guaranteed Bonds
Because

—

I he guarantee of two old-line surety companies is en­
dorsed on each bond.
I he guarantee as to payment of interest and principal
runs directly to the bondholder, and is irrevocable and
binding on either or both companies for the full term of
the bond.
The surety companies add fu rth e r safety to their g u a r­
antee by reinsuring through other approved surety com­
panies.
The bonds yield 6% net over a period of years.
G uaranteed bonds are the safest form of investment for
individuals, tru st estates, and institutions who cannot
afford to lose.
They are secured by properties of such outstanding
m erit that two surety companies regard them so highly
they place their resources squarely behind them.
They are so good they can be insured.

Offering circulars and our booklet “Investment Safety”
will be sent upon request.

Provident State Securities Company
134 N o r th L a S a lle S tr e e t

CHICAGO,

Central Western Banker, July, 1930

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

I LLI NOI S

The Investment Policy
of Small Banks
B y R o b e rt L. John

Secretary, BancNorthwest
Company, Minneapolis, Minn.

serve is not properly constituted to
meet the purpose for which it exists
unless it can be utilized upon necessity
without causing loss of consequence
to the bank. The process of depleting
the secondary reserve in case of ne­
cessity by sale of bonds for the pur­
pose of strengthening the bank’s pri­
mary reserve position is simple, but
the maintenance of a bond list of such

A S I approach this subject I realize
1 that I am entering upon ground
that men of ability and long experience
have crossed before me. It is a sub­
ject the frank discussion of which is
likely to stir up any to whom my ob­
servations may apply and who are
sensitive. But T have some very def­
inite ideas about it. For a number of
years before settling down more to an
inside desk job I went about, over a
considerable territory, in season and
out, in good times and bad, making
calls on country banks. During this
period many deep and lasting impres­
sions were received. On the construc­
tive side, if such were my assignment
here, I might tell of many things re­
flective of the courage, resourceful­
ness and all around ability of the
small bank executive.
What I may say about “The Invest­
ment Policy of Small Banks” (con­
structive as I would like my comment
to be) must, however, be from the
negative side. If asked what was the
deepest impression suggestive of the
need for betterment that was received
over the period of my actual experi­
ence, I would say without hesitation
that it was the lack in general of abil­
R o b e r t L. J o h n
ity to make the required outside in­
vestments of the bank to best advan­
tage and to create and maintain a sec­ character that when this is done seri­
ondary reserve in the proper condi­ ous losses are avoided is not so easy.
tion of liquidity and at the same time
The banker himself usually is an
to the profit of the bank.
expert on local loans. He must man­
age his bank efficiently and keep up
Necessity Recognised
to date on his other assets or he is
The necessity for a secondary re­ negligent in his duties. But too often
serve is, of course, so generally recog­ his circle of information does not ex­
nized that it needs no long discussion. tend beyond local or district affairs
But the means of creating such a re­ and he is faced with difficulty and is
serve, maintaining it and keeping it very largely dependent upon advice
liquid, are not so well understood. The when he himself enters the bond mar­
very fact that there is in a bank a ket. No banker would like to confess
so-called secondary reserve indicates that he knows little or nothing about
that preparation has been made for making loans. It would be an ac­
that of unusual, perhaps of adverse knowledgment of his incompetence
nature, which is not expected but and yet I have heard many a banker
which may occur. A secondary re­ frankly admit that he was in deep


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

water when he got to buying bonds
and that he did not understand how
best to do it.
When a banker buys a bond he is
really making a loan. There is this
difference about it, that when local
borrowers come to him, if he does not
like what they propose and the accom­
modations asked for do not look safe
to him, he need not make the loan.
This is as far as he can go. If there
are people in his town who are very
sound financially and to whom he
would very much like to make loans,
but who do not need to borrow, there
is little that the banker can do about
it. When it comes to making loans,
however, in the form of buying bonds,
he has the whole world before him
and it is the banker’s own choice of
who his borrowers shall be. Too often
he is confused by the multiplicity of
issues and the various differences be­
tween them and finding it a very big
and technical subject he passes it up
altogether and depends upon the ad­
vice of someone who approaches him
in the capacity of a salesman.
Constant Vigil Needed
Confidence in the strength of his in­
stitution is no excuse for the small
hank manager to relinquish his vigil­
ance as to his paper or his bonds. His
bonds carefully held in the vault or in
safekeeping require the same contin­
ual checking and thumbing over that
his note pouch receives. He must be
assured of their continued strength
and marketability. Funds that are
frozen in unmarketable bonds are not
reserves. In a banking sense reserves
are resources in the background, li­
quid or near liquid in character, that
can be moved up to the emergency
line with no delay or appreciable loss
when necessary.
What then are some of the things
that are most essential?
For purposes of this discussion, it
will be necessary to assume that prop­
er reserves of cash, commercial paper,
acceptances or Government bonds and
Central Western Banker, July, 1930

10

Treasury certificates are maintained.
The cash reserve is required by law.
These other reserves are dictated by
good banking judgment and should be
carried and held in the proper propor­
tions in order that the bank may prop­
erly care for its seasonal fluctuations
without taking recourse to the more
permanent type of investment. The
bond reserves, essentially, are a high­
er earning asset and are a backlog or
supplementary force to the cash or
short-time paper reserve hut they
should be regarded as in no way re­
placing the former except as bond ma­
turities come within six months of
due date when the bonds may then be

considered virtually the same as com­
mercial paper.
There are three factors which con­
stitute a good bond—namely, security,
marketability and yield. In purchasing
for the secondary reserve of the bank
the principal factor to keep in mind,
of course, is the security and it is
axiomatic that a bond which is sound
and which has been purchased at a
proper price can generally be sold sat­
isfactorily in case of necessity. The
banker must apply himself to the care­
ful and conscientious study of invest­
ment principles and analysis in order
that he may properly analyze and de­
termine what satisfactorily constitutes

14 miles of wire
added every minute
AN average of fourteen
miles of wire is added to
the Bell System every min­
ute. T he Bell System is a
growing concern with a con­
stantly growing business.
T he average number of Bel]
owned telephones added
yearly is upwards of 800,000
and wdth these new tele­
phones there is provided a
corresponding increase of
buildings, switchboards, un­
derground conduits and
cables, and other plant.
Continuous, reliable and eco­
nomical telephone service can be
given only by the use of the best
equipment and materials in the
construction of the plant. With
the Western Electric Company
as the manufacturer of its tele­
phone apparatus, the Bell System
is assured of an adequate supply
of the necessary delicate and
intricate equipment of the high­
est quality at the lowest cost. New

economies are achieved by con­
stant research and development.
This is one aspect of the
nation-wide organization of the
Bell System, whose aim is to fur­
nish the best possible telephone
service at the least cost consistent
with financial safety.
M a y we send you a copy
o f our booklet, 'B ell Telephone
Securities” ?

BELL T E L E P H O N E
S E C U R I T IE S CO.
195 Broadway, New York City

Central Western Banker, July, 1930

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

a good security and a proper one for
him to buy. He must understand the
marketing of securities in order that
he can determine those which are
likely to have a satisfactory market
at the time when he wishes to sell
them. And he is also charged with
the responsibility of making satisfac­
tory earnings for his bank and his
managerial ability is directly reflected
in the average yield on his bond ac­
count, purchased both for purpose of
a secondary reserve and for invest­
ment. It would be, of course, a very
simple thing for any one of us to pur­
chase for these purposes United States
Government Treasury certificates ma­
turing inside of six months, but the
yield is low and as we get away from
this accepted standard of highest qual­
ity we may expect to receive the re­
ward for study of bond values. It is
very essential, both for the regular in­
vestment account and the secondary
reserve that for the proper mainten­
ance of liquidity and profit the card­
inal principle of diversification he ad­
hered to. It is of prime importance
that the account, of which we speak,
must be so diversified as to geograph­
ical location, as to type of security and
as to maturity that serious upheavals
in our economic world cannot affect
us adversely to the extent of our en­
tire holdings.
M aturitics
Not only is is very difficult, it is
really impossible at any time to pro­
pose a definite program which satis­
factorily meets the conditions of all
institutions. However, for purposes
of a yard stick or rule of thumb, I
am going to outline a theoretical ma­
turity distribution which, to the aver­
age bank in the average year, should
prove most satisfactory and expedient.
For the bank which is purchasing for
secondary reserve and investment
purpose as well, let us assume an ac­
count of average proportions against
deposit liabilities of, say, not over $2,000,000. For this bank let us propose
an account of approximately $800,000
(it should be distinctly understood
this does not propose that all banks
should invest 40 per cent of their de­
posits in bonds) of which $600,000
shall mature within five years. Of this
$600,000 there shall be $300,000 ma­
turing over a longer period. It is es­
sential further, that in the reinvest­
ment of maturities from this schedule,
the original basis and program must
be borne in mind and the same pro­
portions maintained except, of course,
when bond prices are seriously de­
pressed due to periods of high inter­
est rates when longer term bonds may
be purchased, to be converted later

11
into shorter time securities when more
normal conditions have been reached.
Here again a very definite reward
awaits the banker who carefully
studies interest rates and the rise and
fall of bond prices, and observes the
practice of purchase and sale of long
term securities with the resulting
profits accruing from careful han­
dling of his bond account in this way.
In considering the fundamentals to
which attention must be given in ana­
lyzing the security back of the issues
which he is purchasing, the bank merager must first deal with investment
banking houses of sound management
and integrity. No investment banking
house pretends to be infalliable, and
none can guarantee its judgment.
They are recommending merely after
the most careful consideration of all
factors bearing on the situation; after
exhaustive examination upon the part
of reputable attorneys and account­
ants, and then only entering upon a
program of merchandising at a price
that is fair, in their opinion, both to
the borrower and the purchaser of the
investment. The investment banking
house which can give you this service
need in no sense of the word be large
or nationally known. But the banker
should make certain that the house
observes the standards that he must
necessarily observe in the successful
conduct of his own institution.
Ignorance Inexcusable
Too often bankers excuse their er­
rors of judgment in the purchase of
securities by an admission of ignor­
ance. Let me ask your opinion of the
chief executive of a railroad who de­
nied any knowledge of railroad opera­
tion. What faith could stockholders
have in the management of their busi­
ness if its chief executive was ac­
quainted with only half his job. The
head of any business is charged with
the responsibility of its successful op­
eration and must have more than a
speaking acquaintance with its every
phase. Modern business demands the
exercise of sound judgment and the
recognition of sound principles. The
manager of a small bank may conduct
his institution very well from the
viewpoint of service to his community
and may be in all other respects a
competent banker, but if he lacks abil­
ity as an investor, he is very seriously
handicapped.
We have necessarily omitted from
this discussion of the investment pol­
icy of a small bank anything but pass­
ing reference to local loans. That is
a subject big enough for a dozen
chapters. Neither have we referred
other than incidentally to such assets
as cash or those investments maturing


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

within six months for sound banking
practice dictates their use.
To cover sufficiently and adequately
all the phases of our topic would re­
quire many chapters of a good sized
book. I have attempted to impress
upon you the growing importance of
sound investment knowledge as it per­
tains to the safeguarding of the bal­
ance of your depositors’ funds and to
illustrate briefly some of the more im­
portant features to be considered.

Co., investment banking house of Chi­
cago and New York.
Of particular significance are the
substantial decline in the volume of
new offerings, important prior retire­
ments of outstanding issues, a good
record of prompt payment of interest
and principal, the increasing ability of
Europe to supply its own capital re­
quirements and world wide easy cred­
it conditions.
“The Kingdom of Netherlands 6
per cent bonds due in 1954 were retir­
Foreign Securities
ed on April 1, 1929,” the reviewpoints
A very healthy condition in the field out, “The Kingdom of Sweden 6 per
of foreign securities is indicated by a cent bonds due in 1939 were retired
review of the foreign dollar bond sit­ on December 15, 1929. The Kingdom
uation issued by A. G. Becker & of Belgium Al/ 2 per cent bonds due in

Investm ent Advice
Advice is a term often used and often misunderstood.
Analysis rather than advice, should be the first step
in any investment decision. Every corporate investor,
before purchasing any type of securities should analyze
thoroughly its own financial position.
Then when its individual problems are clearly defined
and understood, a competent investment organization
should be consulted
The National City Company, with its international
buying and distributing organization, is well qualified
to act in such consultant capacity. In its list of offer­
ings will be found high grade securities of widely dif­
ferent classifications. From them, with the help of a
National City man, investments that conform to spe­
cific needs may be selected.

T h e N a tio n a l C ity C o m p an y
NAT IONAL

CITY

I N V E S T M E N T

BANK

B U I L D I N G ,

!

Offices in Principal Cities throughout the

NEW

YORK

S E C U R I T I E S

United States

and Canada

and in London, Amsterdam, (geneva, Tokio and Shanghai.

Central Western Banker, luly, 1930

12

1945 have been called for payment on
June 1, 1930, and the Government of
Switzerland 8 per cent bonds due in
1940 will be paid off on the first day
of next year. These prior retirements
will total well over $100,000,000. Sink­
ing fund operations during the past
year have taken a further total of
more than $25,000,000 of European
dollar bonds out of the market.
“Of the billions of European secur­
ities offered in the United States since
1924, the records indicate only one
default and that involving a total loss
of only a very small fraction of 1 per
cent of the offerings from that section
of Europe.

“The rapid emergence of France as
a world money power has been gener­
ally recognized. Great Britain is mak­
ing strenuous efforts to regain its for­
mer preeminence as a world lender
and according to the Department ot
Commerce, pressed us closely last year
in the total loaned.
“Since the first of this month, the
central banks of England, Germany,
Sweden, Denmark, Italy and the Ne­
therlands have reduced their redis­
count rates; in England from 4l/ 2 per
cen to 4 per cent, in Germany from
6 per cent to 5l/ 2 per cent, in Sweden
from 4Jd per cent to 4 per cent, in
Denmark from 5 per cent to 4y2 per

cent, in Italy from 7 per cent to 6l/ 2
per cent, and in the Netherlands from
4 per cent to 3jd per cent. The rate in
France is 3 per cent, having been re­
duced from Zy2 per cent on January
30.
“The trend toward higher prices is
well illustrated by what is happening
in German dollar bonds. The A. G.
Becker & Co. averages for 25 repre­
sentative issues showed a yield of
7.59 per cent at the close of the year.
Each week, without exception, prices
have not moved upward, and the yield
is now 7.25 per cent. In our opinion,
buying in any volume will accentuate
the trend and result in substantially
higher price levels.”
U.

S.

BONDS FOR
SECONDARY RESERVES
Dr. Paul M. Atkins, economist of
Ames, Emerich & Co., calls attention,
in the company’s recent Current Bank
Brief, to the fact that ETnited States

D r. P aul

M.

A t k in s

government securities are peculiarly
useful for a bank secondary reserve.
They not only are readily marketable
under practically all conditions, but
they are also the only securities which
may be used as collateral for loans
from the Federal Reserve Bank.
Both long and short term bonds are
desirable, says Dr. Atkins, for the
short term bonds may be purchased in
such a way as to provide a fund of
rotating maturities, while the long
term, as well as the short term bonds,
may be used as collateral with the
Federal Reserve Bank.
Two Big Advantages
Offsetting these advantages, there
are two im p o rtan t considerations
which should not be overlooked, Dr.
Central Western Banker, July, 1930

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

13
Atkins continues. One is the fact that
United States government securities
respond in price more quickly to
changes in the market rate of inter­
est than do any other class of security.
While it is quite possible to market
large blocks of them without affecting
the market price of the moment near­
ly as much as in the case of other se­
curities, it must not be forgotten that
the price fluctuations come more
quickly in the case of United States
government securities than in any
other types of bonds, d he second is
that the yield from these securities is
low.
Dr. Atkins concludes:
“The marked ad v an tag e which
United States government securities
possess for use in a bank secondary
reserve are so great that they more
than offset the disadvantages on most
occasions. It is usually wise, therefore,
for most banks at practically all times
to make up a substantial proportion of
their secondary reserve account of
these securities.
Commercial Failures
'C'AILURES of business concerns
are increasing, as they always do
increase in this country when business
B U S IN E S S
AND

A C T IV IT Y

C O M M E R C IA L

FAILURES

rr
j
□
iJ k I 1 i i
A
i s i i k iun 1
JL !«S® B j 1■' * i r
r !*■
*r m
J M
□J □ J
f
■
M B USIN ESS
i
1
E
j A C TIV IT Y
Î
T
fF
□ u u
L
:□ □
_
A
—
j
y
r\
I
1J
I 5
i VA
7
1
j
¡COMMERCIAL
j
\
H FAILURES
V\ j
1
,_
V.
'
A

1

II

12 13 14 6

16 17 18 19 2021 22 23 2 4 25 26 27 28 29 30

is slow. In absolute numbers they have
recently risen to new high records, but
this would not be so if the numbers of
failures were considered in relation­
ship to the number of firms in busi­
ness. In the diagram there is shown a
comparison, covering the past 20
years, between the changes f r om
month to month in general business
activity, and the numbers of commer­
cial failures.
The black silhouette in the upper
portion of the diagram shows the com­
puted variations of general business
activity above and below normal. In
the depression of 1914-15, at the out­
break of the war, the decline went as


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

low as 18 per cent below normal, and
in the post-war depression it reached
24 per cent below. Recently business
activity has gone down to 10 per cent
below normal, and in April it was
about eight per cent below. During
the war prosperity business activity
reached 18 per cent above normal, and
last summer it was as high as 12 per
cent above.
The line in the lower portion of the
diagram represents commercial fail­
ures according to the Dun figures
smoothed to remove seasonal varia­
tions. Its general trend is a rising one,
in accord with the increasing numbers
of firms doing business, but its shorter

fluctuations correspond to the more
important changes in business activity
as shown in the silhouette in the upper
diagram. This correspondence is not
close, but it is clearly evident. The fig­
ures in the scale at the left refer to
the number of insolvencies per month
in the United States.
When the war broke out in 1914 a
period of severe depression ensued,
and failures rose sharply. This was
followed by business recovery in 1915,
which ushered in the period of war
and post-war prosperity that lasted
until 1920. During all that period fail­
ures declined until a time was reached
when it was almost difficult for any

GOOD SOUND INSTITUTIONS will continue to grow and
expand in spite of market conditions and we suggest the purchase
today of

American Investment
Trust Shares
which represents an interest in stocks of the following leading
institutions of the Countrv:
American Telephone and Telegraph
Atchison Topeka and Santa Fe Ry.
Borden Company (T h e)
The Chase National Bank of the
City of N. Y.
Columbia Gas and Electric
Corporation
Consolidated Gas Company of New
York
E. I. du P o nt de Nemours and Co.
General Electric Company
International H arvester Company

National Biscuit Company
New York Central Railroad Co.
The N orth American Company
Pennsylvania Railroad Company
R. J. Reynolds Tob. Co. B. Stock
Standard Oil Company (N. J.)
Union Carbide and Carbon
Corporation
United Gas Improvement Company
United States Steel Corporation
F. W. W oolw orth Co.
Westinghouse Electric & M anufac­
turing Co.

We feel that these stocks represent real values at today’s prices
and suggest an immediate reservation for American Investment
Trust Shares.
This method of purchasing stocks gives complete diversification
which is ordinarily not possible unless the investor has t large
sum of money available.
Detailed information will be sent upon request.

SMITH, LANDERYOU & CO
210 Farnam Building,
Omaha, Nebraska
Phone Ja. 5065
Central Western Banker, July, 1930

14
firm to be so inefficient as to go into
insolvency. Finally the down-turn of
business began in 1920, and failures
rose for more than two years, only to
decline again when prosperity had re­
turned in 1922 and 1923.
The recent decline in business be­
gan last summer, and the failure line,
which had been declining, turned up
again. It is still rising, and according
to past experience we may expect it
to continue to advance until a real im­
provement in general business activity
gets well under way. There can be lit­
tle doubt that the actual number of
failures will be greater in 1930 than in
any previous year, but it seems entire­
ly probable that before next winter
the failure line will be declining once
more.—From Cleveland Trust Com­
pany Bulletin.

OUR
WILL

BE

The Lucky Director and
the Minority Stockholders
(C ontinued from page 7)

Michigan Courts for a decree that the
quoted paragraph of the will was void,
and that the executors be given full
and free right to vote at any and all
meetings of the stockholders as they
deemed best. Instructions to the ex­
ecutors w hereby said testator at­
tempted to determine the personnel of
a majority of the board of said Mar­
shall Furnace Company, and to pre­
vent amendment of the by-laws there­
of, for a period of ten years, were in­
valid, that the executors were not
bound thereby, and the Court so de­
cided.
“It is clear that executors have
power to vote the stock of their testa­
tor at all meetings, being the personal

OFFERING

MAILED

LIST

REGULARLY

UPON

REQUEST

G M A C obligations
enjoy the protective background of highly
liquid assets, with credit factors widely diver­
sified in region and enterprise. Long regarded as
a national standard for short term investment,
they have been purchased by thousands of banks,
institutions and individuals the country over.
available in convenient maturities and
denominations at current discount rates

G en er a l M o to rs
A c c epta n c e C o r p o r a t io n
OFFICES

Executive Office

CAPITAL,

-

IN

PRINCIPAL

B r o a d w a y at

To Have Power Service
Within the next four years 1,000,000 of the 6,300,000 farms in the
United States will be provided with
electric service, it is predicted in a
study of agricultural electrification
just completed by the Middle West
Utilities Company. There are 150,000
miles of rural electric lines now in
service, the booklet states, and this
distributing system has brought elec­
trical power to almost as great a num­
ber of farms as the total number of
customers served by the electrical in­
dustry 25 years ago.
In this installation of electrical
power equipment to the farm, the pub­
lic utility companies have expended a
total of $200,000,000 in the last eight
years and the farmers have invested
almost an equal amount in wiring, ap­
pliances and machinery to utilize the
power. The next four years will
probably involve the expenditure of
an amount equal to the present total
investment in farm electrical equip­
ment, it is stated.

CITIES

St r e e t

-

New T or\ City

SURPLUS
AND UNDIVIDED
OVER
$ 6 6 , 0 0 0 , 0 00

Central Western Banker, July, 1930

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

57th

representatives of such decedent, and
that until a settlement and division of
the estate the stock of a decedent be­
longs to his personal representatives.
Similarly, corporate stock standing in
the name of an administrator may be
voted by him, in electing directors, as
against those holding a beneficiary in­
terest therein. In the case of shares in
the hands of a trustee, if the trust is
of such a nature that the trustee has
no control and management of the
property, and is to exercise his dis­
cretion concerning it, then he is the
proper person to represent and vote
upon it. And the corporation cannot
be required to examine into the nature
of the trust, with a view to decide as
to the right to vote. The paragraph of
the will, wherein the testator attempted
to create and direct a testamentary
voting trust for a fixed period of irre­
vocability, and to exclude for a fixed
period his representatives from the
exercise of their personal judgments
as to the management of affairs of the
corporation, and to perpetrate certain
persons in office and control of the
company without regard to the rights
of minority stockholders, is contrary
to public policy and void,” said the
Court.

PROFITS

Declares 2% Dividend
Swift & Co. has declared dividend
No. 178 at the rate of 2 per cent upon
the outstanding capital stock of the
company, payable July 1, 1930, to
stockholders of record June 10. This
will amount to 50 cents per share on
the new $25 par and to $2 a share on
the old $100 par stock.

15
I N A recent
* article Pres­
ident Hous­
ton, of the
Mutual Life, makes this statement.
“Big business will become bigger. Big
business of today is a pigmy compared
to what it will be 50 years from now.
No man had enough imagination 50
years ago to picture what business
would be today and no man today has
imagination enough to picture what it
will be 50 years from now. No man
with whom 1 have been acquainted
has had enough imagination to keep
up with America in the conduct of his
business.”
Our business—every man and wo­
man connected with it should feel
pride in it—has developed as America
has developed, and it will go on to
heights which no one of us can fore­
cast. The power and influence of
protection are becoming increasingly
felt. Already life insurance payments
made to beneficiaries are checking the
increase in state budgets for curative
and hospital aid. In the next decade
and in decades to come the effect of
our present $100,000,000,000 of insur­
ance in force will have greater weight
in this public function and tax rates in
the future will be reduced through
the contribution made by life insur­
ance.
Every agent must feel a keen re­
sponsibility in this growth. The wel­
fare of our business, its integrity and
its high standards can be maintained
only if representatives everywhere
make themselves qualified to present
the benefits of life insurance in their
true light, and apply these benefits ac­
curately to the multiple needs of indi­
viduals and of business. If you can
create implicit confidence in yourself,
you need not be disturbed about the
continuance of your business.

uable protec­
tion. In other
words, h i s
loan should
be regarded as a bank loan and be
repaid at stated intervals in the same
manner that he would repay a bank
for money advanced.

Business Life Insurance a
•tabili: er

Four Types
Have you ever stopped to consider
that from the standpoint of personal
accomplishment, there are four out­
standing types of individuals?
1. Those who never start.

2. Those who start but stop without
accomplishment.
3. Those who start only under ex­
treme pressure and carry on only by
constant guidance.
4. Genuine self-starters.
Initiative to create and will power
to perform are the two most important
assets of any life underwriter.
The country is still going through
a financial readjustment. We have
ceased discounting probable future
earnings as reflected by former stockmarket quotations and we are giving


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

Needs Protection

By

For months we have talked about
creating peace of mind through life
insurance. This is still necessary and
always will be effective, but the com­
panion idea which is of equal import­
weight to actual interest and dividend ance in this time of readjustment,
is the need of stabilising business
returns.
During the past six months and par­ through life insurance. Business needs
ticularly from last October through life insurance to protect its interests
last February, life insurance com­ fully as must as Mr. Average Man
panies demonstrated in most convinc­ needs life insurance to protect his
ing terms their impregnable solvency. family.
I wonder sometimes whether life
They advanced in the aggregate huge
amounts of money to borrowers upon underwriters fully recognize the asset
the security of policies as collateral at they have in carrying on business in a
section that is insurance minded-—
where life insurance is looked upon as
an economic necessity -— as a supple­
ment to any plan of saving or of cre­
ating values.
And yet, few business men in this
section realize or appreciate the posi­
tive advantages of business life in­
surance. These can he illustrated by
eight points.
1. It pays indemnity for loss.
2. It pays indemnity at once and
without discussion or adjustment.
3. It reenforces credit.
4. It protects endorsers.
a. Known — signor of corpora­
tion paper.
b. Unknown — as a partner in
unlimited partnership.
5. It provides cash capital for pur­
chase of deceased’s business interest.
6. It provides a method by which a
part owner of a business can make
certain that his estate can liquidate his
G eo rge W. S m i t h
interest at par.
7. It provides inexpensive but im­
a time when it was almost impossible portant guarantees as additional com­
to obtain money from other sources. pensation to valuable employes.
In many instances a policy loan se­
8. As an indemnity for loss it is not
cured at this time of stress under­ subject to Federal Income Taxes.
mines the continuance of policy pro­
tection. Most of these loans were
maximum loans and there is a strong
Grimes Canning Co. Decision
tendency on the part of the borrower
Damage caused by a fire is not po­
to feel that his entire equity has be­
come exhausted and that his interest tentially complete when the fire starts,
is not well served by continuing his but occurs as the flames eat their way,
original policy. The entire executive Federal Judge Martin J. Wade, de­
life insurance world is keenly aware cided in federal district court last
of this unusual situation and a very week in Des Moines.
The judge’s decision came as he di­
real responsibility is placed upon each
agent to secure repayments of policy rected the Springfield, Massachusetts,
loans on account and thereby create Fire and Marine Insurance Company
in the mind of the insured the proper to pay $16,151.43 for losses incurred
feeling that his insurance is still val­ in fire which destroyed the Grimes
Central Western Banker, Jidy, 1930

President, New England Mutual
Life Insurance Company

16

Canning Company plant, at Rockwell
City.
The company argued that their pol­
icy did not go into effect until noon of
the day the fire occurred and that the
fire, which started at 11 :57 A.M., had
potentially destroyed the plant before
the policy became effective. Actual
destruction of corn insured did not
take place until after noon and the
policy was in effect at that time, the
judge ruled.
At Kansas City
The Bankers National Life an­
nounces the appointment of Hugh

Branson as assistant superintendent
of agencies assigned to its Kansas
City office.
Mr. Branson has served the Bank­
ers National Life faithfully for a pe­
riod of over two years, principally as
field supervisor and organizer for
both the former Denver company as
well as the New ffirsev company.
John E. Sullivan, insurance com­
missioner of New Hampshire, states
that the financial responsibility law
of that state is proving 100 per cent
satisfactory. He points out that since
the law went into effect, the number

Casualty Insurance?
Yes!
Surety Bonds?
Certainly!
Service?
Absolutely!
WRITE TO

Federal Surety Company

I

W. L. TAYLOR
President

Central Western Banker, July, 1930

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

Home Office

Davenport, Iowa

of motorists voluntarily purchasing
automobile insurance has increased
from 25 per cent to 75 per cent.
Becomes Treasurer
Fred H. Eyler has been elected
Treasurer of The Omaha National
Company, investment and insurance
affiliate of The Omaha National Bank,
according to announcement by W.
Dale Clark, President of both organ­
izations. Mr. Eyler returns to Omaha
after an absence of several years in
St. Joseph and Chicago. He entered
the employ of The Omaha National

F re d

H.

E yler

Bank in 1918, and, after serving as
discount teller, he went to St. Joseph
to become Vice President of the
Drovers and Merchants Bank of St.
Joseph, Missouri, in 1925. In 1929 he
went to Chicago as representative of
the Omaha National Company.
Mr. Eyler graduated from Omaha
High School in 1915.
Mr. Eyler has been active in bank
organizations. While in St. Joseph
he was President of the Buchanan
County Bankers Association, and or­
ganized the St. Joseph Chapter of the
American Institute of Banking.
O
Wheat Loans
Wheat growers of Oregon, Wash­
ington, Idaho and Montana, embraced
by the North Pacific Grain Growers,
Inc., have been loaned $2,500,000 and
an additional $750,000 for them is in
transit, officials of the association said
this week.
The last of a flood of 4,300,000
bushels of grain offered as security
for loans has been checked over. If
all of this is approved, an additional
half million dollars will be necessary
to complete the loans on the 1929 crop.

17
D. V. Blatter Heads Group
D. V. Blatter, president of the Al­
bion National Bank, was elected pres­
ident of Group 2 of the Nebraska
Bankers association at the annual
meeting at Fremont. Earl C. Burdic,
vice president of the Plateau State
Bank of Herman, was made vice pres­
ident; Herman F. Meyer, cashier of
the Farmers State Bank of Scribner,
was reelected secretary for the fifth
time.
The convention unanimously adopted
the following resolutions, framed by a
committee of Ross F. Hammond, pres­
ident of the Union National Bank,
Fremont; T. F. Green, vice president
of the Farmers State Bank, Valley;
and Mr. Burdic:
“The members of Group Two ex­
press a keen sense of the great obliga­
tions resting upon us. At no time have
we been custodians of the public wel­
fare more than now. We have no de­
sire to unduly exalt or magnify our
occupation, but it is fitting that we
give utterance to our understanding of
the relationship we sustain to the com­
mercial and financial world.
“Our banks are in a true sense the
hearts of the communities they serve.
Through them flow the life currents
of trade. Upon their proper function­
ing largely depends the strength and
health of the business body. The vigor
of these vital organs may well be a
matter of deep and general concern.
It is of equal importance to them and
to business. Their mutuality cannot be
ignored or denied. For long and fate­
ful years these hearts suffered from
high blood pressure. They were sub­
jected to artificial stimulants. The dig­
italis of speculation, of high priced
land and livestock and of everything
constituting the whole commercial
body induced palpitation of the heart
until there followed a paralysis that
left the body prostrate, anemic and
weak. Regrettably many hearts have
ceased to beat at all. There come
quacks with their ‘guaranteed nos­
trums,’ but these failed of any cura­
tive properties. If their application
prolonged life in any degree it was
only that the end might be the more
painful. It was dissipation and disso­
lution. Now it is dissolution.
“We declare that sound banking de­
pends much less upon legislation than
it does upon integrity and business
sense. Our banks, in order to satisfy
the stockholders and to best serve the
public must prosper. To do that we
must be more and more exacting and
careful in the making of loans. We
function in a fiduciary capacity. To
our care is committed the funds of
our depositors. To perform the many
services banks afford they must look


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

to the profit accruing from the use of
their deposits. They cannot survive if
they permit the borrower to fix the
terms of replacement or to default in
such obligation. The borrower is most
frequently and u su ally the bankwrecker. Too often he regards his

Life

bank as his legitimate prey. Once he
obtains a loan his main purpose ap­
pears all too frequently to resist its
payment. It is the bankers’ chief task
to defeat these designing persons. Our
loan committees should grant rather
than approve loans. An ounce of pre-

In su ra n ce —
the Banker's Friend

B a n k s a re th e m e d iu m t h r o u g h w h ich m o d e r n b usiness of all k in d s is
c a rr ie d on. They, in t u r n , a re d e p e n d e n t on g e n e ra l b u sin e ss a c tiv ities fo r
t h e i r own pro sp erity .
Life in s u ra n c e does m u c h to stab ilize b usiness o p eratio n s.
I t sa f e ­
g u a r d s m e r c a n ti le an d i n d u s t r i a l e n te r p r i s e s a g a i n s t loss occasioned by th e
d e a th of th e i r m a n a g i n g heads. I t step s in a n d m e e ts th e financial n eed s of
a fa m ily w hose b r e a d w in n e r h a s been ta k e n . It pro vides s te a d y in com es fo r
people w ho h a v e t a k e n f o r e t h o u g h t fo r t h e i r l a t e r years.
T he beneficiaries of life in s u r a n c e a re c u s to m e rs of th e b a n k s in th e i r
h o m e c o m m u n ities , a n d th e m oney paid t h e m soon finds its w ay into deposit
accou nts, in v e s tm e n ts , a n d th e c h a n n e ls of ev ery d ay business.
F o r his own se lf-in te r e s t an d th e g e n e ra l good of th o s e w ho rely upon
h im , every b a n k e r sh o u ld p ro te c t his ow n in s ti tu t io n a n d fa m ily w ith a d e ­
q u a te life in s u r a n c e a n d e n c o u ra g e his p a tr o n s to do likew ise
The

SER VICE LIFE
IN S U R A N C E CO., L IN C O L N , N E B R .
H o m e Office Bldg'., 1.1th an d N S tr e e ts

B. R. BAYS,
P r e s id e n t

JO H N L. O E S C H G E R ,
S ec’y-Treas.

O m a h a L ife In s u r a n c e C o m pa n y
Has an opening in
Sioux Citv
Waterloo
Atlantic
and
Des Moines
For capable man

E. M. SEARLE, Jr., Pres.

Omaha, Nebraska

Central Western Banker, July, 1930

18

vent-ion is worth more than a ton of
poor paper. In much counsel there is
most wisdom. Solvency beats being
merely a ‘good fellow.’ Eliminate
charge-offs and our dividends, undi­
vided profits, surplus and capital will
be no longer in danger.
“We realize our mistakes made in
the past in soliciting unprofitable ac­
counts. Analysis of these and building
them up or in some way charging
through a just system of fees for ser­
vices rendered we recognize as indispensible and unavoidable. Bank ser­
vices and banking costs have increased
enormously while rates of interest
have remained practically stationary.
Obviously there must be increased rev­
enues to meet increased costs. The
very life of our institutions demands

this remedy. Our duty courageously
met will be approved by our patrons.
The public has an appreciative sense
of sound banks and no bank that is
not prosperous can be sufficiently
sound.
“Meanwhile we shall deplore agita­
tion that increases distrust. We must
ask to be permitted to resort to our
own honest and devoted efforts to
maintain public confidence, assisted in
this by cooperation and rigid super­
vision of state and federal authorities.
We rejoice in the passing of the night
and the coming of a new day. There­
fore, be it Resolved, That we pledge
ourselves anew to the achievement of
purposes herein set forth and to leave
nothing undone within our power to
that end.”

A
C orrespondent
Service
developed
from 68 years’
experience

F O R E M A N -S T A T E N A T I O N A L BANK
FOREMAN-STATE TRUST AND SAVINGS BANK
CHICAGO

33
N OR T H
LA SALLE
STREET

R E S O U R C E S

E X C E E D

Central Western Banker, July, 1930

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

200

M ILLIO N

DOLLARS

The Bank of Florence, at Omaha,
Nebraska, which was closed by the
State Department of Trade and Com­
merce May 8, was reopened for busi­
ness June 21st with new officers.
W. B. Roberts, Vice President of
the First Trust Company of Omaha,
is the President of the Bank. C. D.
Saunders, formerly Cashier of the
First National Bank or Denison, la.,
is vice president. Robert H. Hall,
formerly for ten years associated with
the Farmers State Bank of Millard,
Nebraska, as assistant cashier, is the
new cashier of the Florence bank. Mr.
Saunders and Mr. Hall are in active
charge of the institution.
These officers, with T. L. Davis,
vice president of the First National
Bank of Omaha, will be directors of
the new bank. They are also the stock­
holders, with Fred W. Thomas, vice
president of the First National Bank
of Omaha.
Capital and surplus of $30,000 was
paid in by the new owners of the bank
in cash. The bank was reorganized
under the direction of the State Bank­
ing Department, and remains a state
bank.
Depositors of the old bank accepted
a 60 per cent reduction of their de­
posits, and were paid 40 per cent in
cash. This came from collections from
notes, and from the fund supplied by
the organizers, and amounts to about
$ 2 0 0 ,0 0 0 .

The balance due them will be paid,
as far as possible, from collections
from slow paper, which has been
placed in the hands of a depositors’
committee. Eventually, it is hoped,
depositors will receive approximately
two-thirds of their deposits in the old
bank.
The inquiry into the state bank sys­
tem of Nebraska, including the man­
agement of failed banks, the guaranty
fund and the guaranty fund commis­
sion, will be concluded by August 1st,
according to an announcement by A.
C. Shallenberger, former Governor, in
charge of the audit.
Mr. Shallenberger said that he
would wind up the affairs then and
leave the audit to begin his campaign
for congress, and that he had the
word of Governor Weaver that the
audit will not be carried on after that.
Among major propositions remain­
ing for his attention, said Mr. Shall­
enberger, was an audit of the two
million dollar expense account in­
curred by the guaranty fund commis­
sion, and of the sixteen million dollars
collected by assessment for payment
of depositors in failed banks.
(C ontinued on page 30)

19
<iiMiiiiiiiiimiiiiii!iiMiiiiiiiiiiiiiiiiiiiiniiimiiiiiiiiiiii!iiiimiii!iiiiimiiiNiiiiiiiiiMiNiMiiiiii!imiiii!imiii!iiimiiimiiiiimiiiiiii!iiimiiiMi!iiiiiiiiimiiiiii!imiit

«inumili.... ui... i................................... .....ini... ...... mini..................................ululili.....mi......

The directors are men of some ex­
perience and the people of the com­
munity are confident of the future
success of the institution.
A . N. M A T H E R S ,
( 'r e s i d e n t , N e b r a s k a R a n k e r s A s s o e i u t i o n

Buys Interest
Mr. R. F. Stuckey of Lexington,
Nebraska, a prominent business man
and banker there, has purchased a
block of stock in the Cozad State
Bank, and becomes a director of this
institution.
Mr. Stuckey is president of the
Lexington State Bank, one of the
strongest banking houses in this coun­
ty.

messenger boy. He is the oldest reg­
istered member of the Nebraska His­
torical society. His father, a contrac­
tor, lived in the first frame house in
Omaha. During July Mr. Davis, and
his family, plan to spend their vaca­
tion in New Jersey coast resorts.

Reorganize Elmcreek Bank
The Farmers and Merchants Bank
of Elmcreek, Nebraska, which was
closed some time ago and has since
been in charge of the State BankCommissioner, is to be re-opened at a
very early date, according to informa­
tion received from an authentic
source. It is to have a paid-up capital
of $25,000 and a surplus of $2,500. At
a meeting of stockholders the follow­
ing officers were chosen: R. A. St.
John, president; J. G. Lowe, Kearney,
vice president; H. F. St. John, cash­
ier. The list of stockholders includes
in addition to the men just named, J.
A. Norris, Dr. Yoder, A. Reeves, H.
H. Northrup, Edd. Beavers, Mr.
Gresham, and Mr. Steele.
The bank is understood to have
been in good condition at the time of
closing, but a call for funds by certain
depositors reduced the immediate sup­
ply of cash on hand to the place where
it was unable to meet demands at
once. Tt will re-open under very fa­
vorable conditions and promises to be­
come one of the strong financial insti­
tutions of the countv.

ONE OF THE OLDEST banks in
Jefferson county, Nebraska, was dis­
solved June 16, when the Harbine
Bank and the First National Banks of
Fairbury were merged. Both are mem­
bers of the Northwest Bancorporation, and the merger was under the
direction of the Bancorporation.
The Harbine business was moved to
the F irs t National bank building
Buy Elkhorn Bank
The interests of H. B. and W. P. where extensive remodeling has been
Waldron of Omaha in the Farmers’ done.
The Harbine bank was established
State Bank of Elkhorn, Nebraska, has
been purchased by C. C. Holling, W. in 1873 by Colonel Thomas Harbine
E. Moor and E. A. Saeger of Elk­ as a private bank and has always since
horn. Mr. Holling will become presi­ been one of the leading banks of
dent of the bank, Mr. Moor, vice Fairbury.
president, and Mr. Saeger, cashier.
THE ADDITION and remodeling
Mr. Moor has been cashier of the
of the First National Bank of Omaha
bank for the past eight years.
have been preceding rapidly. The sav­
THE SECURITY STATE BANK ings department is now installed in its
of Anslev, Nebraska, was sold in mid- new quarters, which are on the ground
June by R. Id. Storz of Omaha, to a floor of the bank building, north of
group of Broken Bow and Ansley the previous quarters, and which have
men. The new president is T. T. Var­ an entrance from Sixteenth street,
ney, sr., of Broken Bow, president of Omaha’s main thoroughfare. The First
the Broken Bow State bank. Asso­ Trust company is in new and larger
ciated with him are M. Weil of Lin­ quarters in the bank building and
coln and J. M. Watts of Belgrade, there have been additions to the main
among others, these two becoming banking quarters. The four story ad­
dition to the bank has been erected
vice presidents of the bank.
almost without notice by the city, be­
H. B. and W. P. WALDRON of cause it is in a space west of the bank
Omaha have sold their interest in the and back of the Farnam building. Tt
Farmers State bank of Elkhorn. Ne­ makes an L shape of the First Nation­
braska, to C. C. Holling, W. E. Moor al bank building.
and E. A. Saeger of Elkhorn. Mr.
GWYER YATES, vice president
Holling has become the president of
the bank, Mr. Moor vice president and of the Lhiited States National Bank
Mr. Saeger cashier. Mr. Moor has of Omaha, who has had considerable
been cashier of the bank for the past difficulty with a wrenched knee, has
eight years. The bank is now owned again been able to return to the golf
links, and is recovering.
entirely in Elkhorn.

Bank Re-opens
The Citizens State Bank of Clear­
water, Nebraska, reopened recently
with a strong reserve and backed by
a group of stockholders representative
of the wealth of the community.
Dr. J. W. Bennie is president of the
bank; Frank Mapes, vice president,
and H. D. Miller, cashier. Mr. Miller
has had twenty-two years’ banking ex­
perience.

FRED H. DAVIS, president of the
First National Bank of Omaha, cele­
brated his seventy - seventh birthday
early in June. He is a native of Oma­
ha, and is now the reigning king of
Ak-Sar-Ben.
Although recently ill, Mr. Davis is
now much improved in health, and is
at his desk in the bank daily.
He began with the First National
bank 58 years ago as a collector and

W M . I!. H U G H E S , S e c r e t a r y ,
N e b r a s k a R a n k e r s A s s o c ia tio n


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

ELLSWORTH MOSER, secretary
of the United States Trust company,
spent the month of June on vacation
in the Minnesota lake region.
ONE OF THE ISSUES in the
coming campaign in Nebraska will be
the proposal, submitted in the form
of a constitutional amendment to the
voters, that the people authorize a levy
to pay 8 million dollars of the losses
Central Western Banker, July, 1930

20

in the guaranty fund. Both Governor
Weaver and Attorney General Soren­
sen are urging the state to authorize
tins payment, on the grounds that the
guaranty fund deficit is, in part at
least, a “moral obligation” of the
state as a whole. It is proposed to use
the tax levy, if it is authorized, in
helping make payments to depositors
in banks that were closed while the
guaranty fund system was in opera­
tion.
ROSS L. HAMMOND, president
of the Union National Bank of Fre­
mont, is slowly recovering following a
collapse in the bank this spring.
VICTOR B. SMITH,vicepresident
of the Omaha National bank, and his
family are to spend their summer va­
cation, as usual, in the northern Min­
nesota lake region.
“Easy money” is a delusion and a
snare. There isn’t any such lasting
commodity in the Marts of Experi­
ence.-—Ren Mulford, Jr.

New Ideas in the
D A N K depositors are developing new
ideas that have compelled bankers
to adopt revolutionary changes in de­
posit banking to meet the situation,
Austin McLanahan, President Sav­
ings Bank Division, American Bank­
ers Association, President Savings
Bank of Baltimore, Maryland, told the
eastern regional savings conference
meeting.
“There has been a revolution in de­
posit banking,” he said in part. “De­
posits are free to go where they will
and the banks now have to supplement
safety with service, and this service
has been expanded to such an extent
that it is quite costly.
“The point of view of the depositor
has changed. He is being urged to put
his money into bonds and stocks, and
because the rate of interest paid in
some sections of the country is over 4
per cent on savings accounts, he can

The

Continental National Bank
LINCOLN, NEBRASKA

“A B a n k fo r B a n kers”
Our consistent growth and progress, contributed to
largely by our correspondents throughout Nebraska, is
indicative of the careful service and prompt attention
rendered them.
We solicit the accounts of Banks and Bankers, offer­
ing every facility and service.
O F F IC E R S
C H A S . T. K N A P P , C h a ir m a n o f t h e B o a r d .
E D W I N N. V A N H O R N E , P r e s i d e n t
W . S. B A T T E Y , A s s t . V i c e - P r e s
R A Y C. J O H N S O N , A s s t . V ic e - P r e s .
T. B. S T R A IN , V i c e - P r e s i d e n t
W H E A T O N B A T T E Y , A s s t . C a s h ie r .
E D W A R D A . B E C K E R , C a s h ie r

Central Typewriter Exchange, Inc.
(E S T . 1903)

T Y P E W R IT E R S , A D D IN G M A C H IN E S, C H E C K W R IT E R S
L A T E S T M O D E L S A T BIG D ISC O U N T
A S K TO S E E

ALLEN-WALES
1912 Farnam S t
Central Western Banker, July, 1930

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

T H E F IN E S T “H E A V Y D U T Y ”
A D D IN G M A C H IN E M A D E

Omaha, Nebraska

only better his return by buying high
yield bonds which have an element of
danger in them, or he can buy com­
mon or preferred stocks, the latter in
some cases giving a very generous
yield and with apparently sufficient
safety.
“There are also the building and
loan associations paying a high rate of
interest and engaging in banking and
promotion functions, but still enjoying
the tradition of conservatism. Morris
Plan banks and other agencies of the
sort have their appeals.
Security First
“After all, what are the advantages
of a savings account over the other
forms of competitive attractions? First
and foremost should be security. The
assets of the bank should be so em­
ployed as to afford absolute assurance
that the savings accounts are abund­
antly secured as to their principal and
interest. With the decline in the real
estate market the building and loan
associations have had their problems
and the higher rates of interest they
pay may in many cases be regarded as
an indication of the risk involved over
and above that indicated by the sav­
ings bank rate.
“In this connection it may be well
to consider whether it is wise, in the
long run, to pay an inadequate return
on your savings accounts. That is be­
ing done in some parts of the country
and the result may be that the growth
in the savings accounts may be slower
than it would be if a higher rate were
paid. The temptation to outsiders to
come in and bid that money away
from you may be detrimental to your
institutions.
“The second advantage the savings
account should have over its competi­
tors is that it is always worth par,
need never be sold at a discount, and
is always available on demand. As a
matter of fact, a majority of savings
accounts are not really savings ac­
counts. They are emergency accounts.
Even a rich man is doing the sensible
thing if he opens a savings account
for an amount which shall be avail­
able to him when a need or an oppor­
tunity arises. How many people last
fall thanked their lucky stars that they
had savings or emergency accounts
with which either to protect their com­
mitments or take advantage of the
bargains that were available in the
bond and stock markets.
“In a few instances savings accounts
are really investments. Many people
of limited means would rather be sure

21

of the safety and integiity of their
principal and relatively low return
than embark on the, to them, unchart­
ed sea of investment. That is a distinc­
tion to be borne in mind. A man who
puts his money in a building and loan
association to all intents and purposes
invests it. The same thing is true to a
greater or less degree of the money he
puts in the other agencies competing
with savings banks, and it would seem
that this difference has not been suffi­
ciently emphasized by the banks.
“There is another element which en­
ters into the picture and that is advice
about investments. The advantage at
present enjoyed by the mutual savings
banks in this respect is that they have
nothing to sell and in consequence
their advice to their depositors or oth­
er interested enquirers is absolutely
disinterested, and you can appreciate
that if you have nothing to sell your
advice can be quite unbiased by the
prospect of profit to you. The inexper­
ienced small capitalist is constantly be­
ing besieged by investment houses, to
place some of his money or all of it
in securities recommended by them,
and if he turns to another investment
house or in most cases to his banker,
that investment house or banker also
has something to sell. In many cases
he knows not where to turn to get a
fair experienced and well considered,
disinterested advice as to the invest­
ment of his money. Nothing is so
satisfying to the other fellow as an
honest effort to put yourself in his
place, see his problems as he does,
and gives him the benefit of your more
extended experience in his effort to
solve them.
“To sum up, we are in the era of
voluntary accounts. We are experienc­
ing sharp competition from other
agencies which attempt to attract our
possible depositors by the lure of high­
er rates and by pretending that the
money placed with them is at all times
as promptly available as it is in the
savings accounts. We offer security, a
fair rate of return, absolute stability
of principal, ready liquidity and a ser­
vice none other can match because un­
biased. We have gone somewhat afield
in some particulars, but that is easily
corrected. With the rapid increase in
wealth in this country there has devel­
oped a species of impatience with time
tried institutions and practices, and
the newer form of investment prac­
tices, such as investment trusts have
had their trial and evidenced the need
of further seasoning. Long continued
prosperity has tended to dim the im­
portance of prudence, caution, and in­
sistence upon a firm and stable found­
ation in financial matters; but the fu­
ture holds bright promise for the sav­


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

ings bankers, if they prove themselves
adaptable to the changing conditions
of life in this country and maintain at
the same time the principles which
they know through long experience
are safe and sound.”
A GROWING DEMAND on the
part of Europe for American
made goods of a modern character is
seen by Ward C. Castle, executive
vice president of the National Bank
of the Republic, who returned to Chi­
cago last month from abroad after six
weeks’ study of conditions across the
Atlantic.
Europe seems particularly interest­
ed in American building materials and
in Italy the demand for patented and

processed roofing and insulating goods
has grown to large proportions, Mr.
Castle said. Italy, he stated, gives an
amazing outlook for prosperity.
Buy Gas Bonds
A syndicate headed by P. W. Chap­
man & Co., and including Hale, Wat­
ers & Co., and Reilly, Brock & Co.,
has purchased an issue of $2,500,000
first mortgage 6 per cent sinking fund
gold bonds of the Southwestern Nat­
ural Gas company. The bonds are
dated May 1, 1930, and mature May
1, 1945. It is understood that the
bonds will be exchangeable on a fa­
vorable basis for stock of the Apalachian Gas Corporation after Feb. 1,
1935.

United States National Bank
O M A H A
“An Unbroken Record of Seventy Years
is a Guarantee of Safe and
Satisfactory Service”

OFFICERS:
W. B . T. B e l t , Chairman o f the Board
R obert P . M o r s m a n ,
G w y e r H. Y a t e s , V ice-President
H . M . B u s h n e l l , V ice-P resident

and

T ru st Officer
T
' r
T7.
n
■,
.
J o s e p h C. M c C l u r e , V ice-P resident
T h o m a s F. M u r p h y , V ice-President
C h a r l e s F. B r i n k m a n , A ss’t. V.-Pres.

P resident

P e r r y B. H e n d r i c k s , A ss’t. V.-Pres.
R a l p h R . R a i n e y , Cashier
H a r r y E . R o g e r s , A ssistant Cashier
E r n e s t E . L a n d s t r o m , A ss’t. Cashier
A u s t i n L . V i c k e r y , A ssistant Cashier
V ic t o r B . C a l d w e l l , A ssistant Cashier
H . W. Y a t e s , A ssista n t T ru st Officer

MllllltlllllllMllllllllllllllllllllllltllllllllllllllllllllllllllllllllllllllllllllllltllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllltllllllllllllllllllllllllllllllllltlHIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIItllllllllllllllltllllll'^

Complete Commercial, Savings, Investment
Banking and Trust Services

I

n
The

I

1

First National Bank
AND

The First Trust Company
I

of

I

LINCOLN, NEBRASKA
~.tiiiiiiiiiiiiiitiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii'iiiiiiiiiiiiii!iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiituiiiiiiiiiimiiiuiiiiimiiiiiiiiimiiiiiiiiiiiiiiiiiiiiimiiiiiiiiiiiiiiiiiiiiiiiiii.

Central Western Banker, July, 1930

22

The Veterans’ Bill
(In d ian a p o lis News)

O F F IC E R S
F O R D E. H O V E Y , President
JA S. B. O W E N , Vice-Pres.
F. J. E N E R S O N , Vice-Pres.
W. H. D R E S S L E R , Cashier
L. K. M O O R E , Asst, to Pres.

OUR

B A N K IN G

M A IN

FLOOR

O

ROOM
RIGHT

H. C. M IL L E R , Asst. Cash.
C. L. O W E N , Asst. Cash.
H E N R Y A. H O V E Y , Asst. Cash.

T. G. BOGGS, Auditor

M A H A ’S Packing Plants produce

more than $210,000,000.00 w orth of meats
and Packing Plouse products annually,
which emphasizes the importance of the
live stock industry.
It is likewise im portant th at the pro­
ceeds from the sale of live stock should be
handled by a bank that specializes in this
line.
W e will be glad of an opportunity to
serve you.

Stock Yards National Bank
of
South Omaha

Affiliated with the
Northwest Bancorporation
The Only Bank in the Union Stock Yards

Central Western Banker, July, 1930

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

President Hoover’s warning to the
senate that the bill to liberalize com­
pensation for veterans of the Wordl
War includes provisions which he re­
gards as unsatisfactory, has been in­
terpreted as an indication that if the
bill reaches the White House with
these features, he will veto it. Con­
sidering the fate of his Spanish War
pension veto, when both houses re­
passed the bill by large majorities, it
may be assumed that he has given
serious thought to the measure and
has consulted his political advisers as
to the probable effect of a veto for
reasons somewhat similar to those
which determined his course in the
former veto action.
The veterans’ organizations’ legisla­
tive committees that have been work­
ing on the measure have weighed the
political effect of a decision at this
time, but they have not been united in
the liberalizing campaign. The house
went to such extremes as to cause the
original proponents of the measure
and the supporting committees to di­
vest themselves of responsibility of it.
They felt that it invited veto and, ap­
parently, they did not believe that they
could work sincerely for it. The house
proposal involved an increase in the
total veterans’ bureau budget item of
about 50 per cent. The senate bill re­
duces the lowest estimate of the house
bill by about 50 per cent. It is esti­
mated that the increase now proposed
will be $74,000,000 a year.
The president is apparently unwill­
ing to subscribe to the bill’s assump­
tion that any World War veteran with
a record of disease contracted prior to
1930 is presumed tto attribute his dis­
tress to war service. The bill adds
twenty-one chronic diseases to the six
now allowed, and includes leprosy.
There has been no indication from the
president of a desire to withhold ade­
quate compensation from any worthy
and deserving veteran in need of the
help.
This seems to be the view of the
country. The danger of easy pension
laws is in the temptation to feign a
condition of illness and need. The de­
moralizing effect of this practice is, of
coure, serious. The effect of the pres­
ident’s warning should be to remind
congress that a liberal pension meas­
ure need not be extravagant
A bride, according to a current
story which we have not yet verified,
walked into a meat market and said:
“1 want half a pound of mince
meat, and please cut it off a nice, ten­
der young mince.”

23

t he

The ABC’s of Branch Banking
(C o n tin u ed from page 5)

a whole was to recover from the ef­
fects of farm deflation.
Mr. Wakefield, President of the
First Bank Stock Corporation, said
“to correct this situation we felt if we
could create an advisory organization,
properly managed and with sufficient
banking experience to offer the indi­
vidual units making up the group, ex­
pert advice and assistance in the man­
agement of local banks, that there
would be no question of the benefits
that would accrue. In adopting the
group plan, we set up the only ma­
chinery that was available to us.” By
the creating of a group, a wider di­
versification of risk and resources is
obtained than is possible in a single
unit. The group included not only a
greater variety of agricultural deposi­
tories, but also many of the banks of
the metropolitan and secondary cities.
Weather conditions are not nearly so
apt to affect the group as the small
unit confined to a single community or
a small trade area.
Experience has shown that there is
a size of community which is too small
to justify the maintaining of a separ­
ately capitalized and corporately
staffed bank of its own, and which the
group cannot enter with a unit bank.
On the other hand, these towns want
some form of banking convenience.
A branch of a larger bank with per­
haps a single officers in charge could
take care of this, while the large cen­
tralized bank, perhaps limited to coun­
ty boundaries, would provide greater
security than the small individual
bank. Group banking and branch
banking could well go hand-in-hand,
supporting each other. The group
plan has distinct advantages at points
sufficiently large to warrant the main­
taining of a unit bank. It retains in
the local community the benefit of lo­
cal management, satisfies the very nat­
ural desire of the residents of the


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

0 m a h a

community that their bank be actually
a home institution.
If branch banking under certain
limitations of area and boundary
should be permitted, then a number of
the larger banks which are in a group
could extend their services by the es­
tablishment of branches in nearby
communities.
Avoids Centralisation
Under a nationwide system of
branch banking, banking capital would
be centralized in the East. With group
banking, quite the contrary is true.
Nothing is taken away from the local
bank to be centered in any city. This
very fact made a strong impression on
members of the committee and others,
as it was brought out in Congress be­
fore the Banking Committee, in the
testimony of Mr. Decker and Mr.
Wakefield. There seems to be some
fear on the part of a good many that
disastrous results may follow if the
concentration of banking capital is
permitted in the East.
The charge has also been made that
under group banking the community
is deprived of taxes. This is a false
notion. Taxes will continue to be
paid by the home bank to the same au­
thorities, and spent in local communr
ties just the same as under the unit
bank system.
In summarizing it may be said that
the group plan brings added financial
strength to the community served by
the local institution, because it would
be possible to draw upon the larger
members of the group in case of need,
while any surplus of loanable funds
could be placed by other members who
might require additional funds for
their customers at that time.
Moreover, the buying of equipment
and supplies, the handling of advertis­
ings, blanket coverage of employes
through fidelity bonds, etc., all bring
visions of greater profits through
more efficient methods.

tock Yards

In my own bank, before entering
the group system, we paid in 1929,
$2,700.00 for fidelity bonds. This
year, with double the coverage, we
paid $980.00
In short, group banking tends to
insure the element of safety, prevents
centralization of banking wealth, and
stands for a mighty factor in main­
taining the area resources for the use
and benefit of the Middle West and
Northwest.
To the adherents of the unit system,
may I say that in my opinion the good,
strong and properly managed unit
bank will continue as usual, and such
a bank need have no fear of competi­
tion from any groups member, or
branch bank, that might be set up
later through a change in our banking
laws.
What America needs is a banking
system that will protect the savings of
the depositor. It doesn’t matter so
much what the form is, if it is built
upon an economic foundation that will
stand all the shocks of disaster, de­
pression and crop failures.
In the rural communities that Unit
System has failed miserably. Branch
banking is not permitted in but ’twelve
states, and group banking, while it has
worked well as far as it has gone, has
not had sufficient time to manifest its
possibilities.
Million in Sight for Montana Roads
Montana’s highway commission this
week passed the million-dollar mark
in contracted work for 1930 by ac­
cepting bids totaling $402,283 on six
contracts. In the three lettings thus
far this year, the commission has
pledged $1,160,511 for construction
costs and engineering supervision,
largely on new work.
Under the 1930 program, there has
been contracted 69 miles of grading,
51 miles of graveling, 116 miles of oil­
ing, including some resurfacing, 18
miles of regrading and 28 bridges.
Central Western Banker, July, 1930

24
John Burns Resigns
The American Shorthorn Breeders
Association announces John C. Burns
resignation as southwestern field re­
presentative of the association, effec­
tive June 1. Correspondence relative
to all matters ordinarily handled by
Mr. Burns, particularly with reference
to shows and sales in that territory,
should be directed as usual to the as­
sociation’s office, 608 Live Stock Ex­
change building, Kansas City, Mo.
Mr. Burns was connected with the
Shorthorn association four years. He
is to become manager of the Texas
Live Stock Marketing association,
sponsored by the Federal Farm Board.
A World’s Record
What appears to be a world’s record
for butterfat production in cow test­
ing associations for a cow not under
supervision of one of the breed asso­
ciations has just been reported for a
registered Wisconsin Holstein by the
Wisconsin college of agriculture. She
is Maud Lucille Pearl and is 11 years
old, but has completed 1,023.5 pounds
of butterfat in 26,177 pounds of milk.
Her feed cost was exactly $166.90,
her profit above feed is $376.88 for
the year. Her twin sister, Grace Pansy
Pearl, is credited with 812.9 pounds
fat in 22,348 pounds of milk at a feed

cost of $143.90 and a profit above feed
cost of $286.75. They belong to the
herd of William and Norman Rada of
Chippewa Falls, Wis. Norman will be
remembered as the 1929 National
Champion Holstein club boy. The
average age of the cows is Al/ 2 years
and the average number of head is
8.9. The total feed cost was $899.15
and the total profit above feed was
$1,599.90. In addition an appreciable
revenue comes from the sale of breed­
ing stock. With one exception all of
the cows now in the herd were pur­
chased as unbred heifer calves.
A Good “Swap”
Corn growers of the Middle West
can swap the price of a ton of fertil­
izer for from 127 to 195 bushels of
corn depending on the state and to
make a still better bargain usually get
a crop of higher quality worth 5 to
10 cents a bushel more. The crop will
also mature earlier and thereby escape
danger of injury from early frosts.
These are not the opinions and ex­
periences of any one farmer or of
farmers in any one locality. They re­
present the estimates and observations
of 14,875 corn growers in 13 impor­
tant corn states of the North and East
who were personally interviewed in an

me

Cl)ast national ©anil
of the City of N e w York
I’in e S tr e e t c o rn er o f N a ssa u

D IR EC T O R '’
A lb ert H . W iggin
W illiam E. S. Grisw old
H e n ry O. H avem eyer
Jo h n M cH ugh
C harles H ayden
C harles S. M cCain
Jam es N. H ill
R obert L. C larkson
A rth u r G. H offm an
W in th ro p W . A ldrich
F ra n k A ltschul
R alph C. H olm es
G eorge H . H ow ard
V in cen t A stor
G ordon A uchincloss
D aniel C. Jackling
E arl D. B abst
O tto H . K ahn
H o w ard B ayne
Lew is Cass L edyard, J r.
Jam es T. Lee
Amos L. B eatty
H ugh B lair-S m ith
L. F. Loree
H e n ry S. Bow ers
H . Edm ond M achold
E. N. B row n
Jo h n C. M artin
F ran cis H . B row nell
Thom as N. M cC arter
K en n eth P. Budd
C harles G. M eyer
H . D onald Campbell
A lbert G. M ilbank
H e n ry W . C annon
Jerem iah M ilbank
Jo h n G. M ilburn
Newcomb C arlton
W alter S. C arp en ter, J r.
G eorge M. M offett
M alcolm G. Chace
G eorge W elw ood M u rra y
Joseph D. O liver
H a ro ld B en jam in C lark
T. S. Coffin
H e n ry O llesheim er
E ugenius H . O uterbridge
H ow ard E. Cole
E d w ard J. C ornish
Thom as I. P ark in so n
F ra n k L. Polk
H arv ey C. Couch
R obert C. P ru y n
F red eric R. C ou d ert
Sam uel F. P ry o r
C larkson Cowl
Paul D. C ravath
L ym an R hoades
A ndrew W . R obertson
B ertra m C u tler
F e rd in a n d W . Roebling, J r.
G erhard M. D ahl
R eeve Schley
T hom as M. Debevoise
C arl J. Schm idlapp
R ichard Delafield
C harles M. Schwab
C larence D illon
A lfred P. Sloan, J r.
F ran k lin D ’O lier
R obert C. Stanley
F red erick H. E cker
Jo h n C. T raphagen
H alstead G. F reem an
T. M. G irdler
C ornelius V anderbilt
Thom as F. V ietor
D avid M. Goodrich
G eorge P. W haley
E d w ard H . R. G reen
F. E dson W hite
A. H . Grisw old
H e n ry R ogers W in th ro p

Central Western Banker, July, 1930

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

investigation of fertilizer use and ef­
fects.
According to estimates made by
several hundred farmers reporting in
the various states, the fertilizer used,
produced yield increases of 13.1 bush­
els in Ohio; 11.5 bushels in Michigan;
9.8 in Indiana; 12.1 in Wisconsin; 9.5
in Kentucky; 9.4 in Illinois; 11.1 in
Iowa; and 7.7 bushels in Missouri.
The rate of fertilizer application vary
from an average of 102 pounds in
Missouri to 160 pounds in Ohio, ac­
cording to these reports.
In terms of bushels of corn pro­
duced by a ton of fertilizer, the Ohio
farmer gets 163 bushels; the Michigan
farmer 195 bushels; the In d ian a
farmer 170 bushels; the Wisconsin
farmer 172 bushels; the Kentucky
farmer 127 bushels; the Illinois farm­
er 175 bushels; the Iowa farmer 185
bushels; and the Missouri farmer 151
bushels. The value of the crop in­
creases in these states is, therefore,
from three to five times the cost of
the fertilizer even at present prices
for corn.
Increased yields, however, are not
the only advantage gained for their
crops, these thousands of farmers say.
For example, 12,343 of those inter­
viewed have observed that fertilizer
improves the market quality of crops,
including corn and other fertilized
crops, and more than 10,000 say it im­
proves the feeding quality. Next to
increased yield, improvement in qual­
ity is the most valuable effect of fer­
tilizer on corn. Frequently it adds as
much to the value of an acre of corn
as the cost of the fertilizer, and may
be worth five to ten cents a bushel or
more in some seasons.
Opens Insurance Stock Mart
An insurance securities market has
been opened by the Chicago Board of
Trade in recognition of the important
place that these stocks occupy in the
investment field, making available for
the first time the great international
trading system which blankets the
United States and Canada and,
through exporting members, has con­
nections throughout South America,
Europe, India, Japan, Cuba and
Australia.
This move, following opening of
the board to listing of general stocks
and bonds in September, 1929, also
has in view the fact that insurance
stock quotations have bee ninadequate,
and especially in the case of stocks
with large values a loss of many
points might be sustained in selling at
the market on a quotation many hours
old.

MUST CARE FOR
AGED EMPLOYEES

J T IS

one of the sacred obligations
of industry to see that retirement
annuities, or old-age pensions, are pro­
vided for its great army of workers,
in the opinion of John G. Lonsdale,
who spoke in Washington, D. C., re­
cently, at a round-table discussion on
business and insurance problems con­
ducted as a part of the eighteenth an­
nual meeting of the United States
Chamber of Commerce.
Mr. Lonsdale, who is president of
the American Bankers Association and
head of the Mercantile - Commerce
Bank and Trust Company of St. Lou­
is, also advocated additional insurance
provisions for the employe as a safe­
guard to himself and those dependent
upon him.
“When you remove from the mind
and heart of an individual the haunt­
ing fear of sickness, accident, and loss
of earning power in old age, you have
lifted a tremendous burden from his
shoulders and made him a more valu­
able employe for your institution,”
said the speaker. "Fear, with its con­
sequent wrecking of morale, has been
the undoing of men and nations. If
modern business and industry can
cause such a specter to disappear from

the rank and file of our workers, what
a wonderful contribution it will be to
the advancement of humanity.
“In our effort at scientific produc­
tion, we have taken into full account
the depreciation of machinery and set

J o h n G. L o n s d a l e
up reserves to take care of it, but in­
dustry as a whole has not yet recog­
nized the fact that the same principle
of depreciation applies to human be­

ings. Men, like machines, inevitably
reach a stage of lessening efficiency in
which it is the part of better economy
to detach them from their work and
replace them with new and better ma­
terial. Countless institutions today
carry on their payrolls employes whom
they hesitate to turn out into the bitter
world for fear of criticism or because
they feel obliged to look after them,
unprepared as they are to finance
themselves for future living. Yet these
same employes are costing their em­
ployers an enormous total through
their inability to carry on effectively.
Prevents Pauperism
"How much better it is if we can
assure such workers that when they
have reached an age agreed on in the
institution that they will be retired
from active service with an income
sufficient to tide them over their re­
maining less productive years! Such a
plan hits directly at the prevention of
pauperism and in the long run will do
much toward relieving many of our
now over-taxed agencies of relief for
the inevitable poor as well as of the
improvident.
“I like to look upon the retirement
annuity as a business problem, because
it is one which has developed solely as
a result of business advancement in

Grain and Hay Draft COLLECTIONS
Given Special Attention
Try Our Service

LIVE STOCK NATIONAL BANK OF SOUTH OMAHA
Union Stock Yards
OMAH A
W. P. ADKINS, P r e s i d e n t

OFFICERS

A LV IN E. JO HN SON , V ice -P re sid e n t

H O W A R D O. W ILSO N, C a sh ie r
R. H. K R O E G E R , A s s i s ta n t C a sh ie r


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

L. V. PU L L IA M , A s s is ta n t C a sh ie r
W. S. H OG UE, A s s i s ta n t C ash ier

Central Western Banker, July, 1930

26
the last four or five decades. Half a
century ago, when virtually all busi­
ness was still in the knee - trousers
stage and afflicted with growing pains,
the economic laws of the time pro­
vided well for the employe. Now, in
the day of the giant corporation, when
all of us, from president on down to
office boy, are employes and respons­
ible to the people who are stockhold­
ers, the problem assumes a different
form. Nevertheless, the obligation for
solution rests squarely on the should­

A

LL

ers of business leaders as surely as
have the questions of increased pro­
duction and distribution.”
Now Head of Firm
Walter E. Sachs, a member of the
firm of Goldman, Sachs & Co., since
1910, was elected president of the cor­
poration at a meeting of the directors.
He succeeds Waddill Catchings who
retired as president and a director of
the company effective June 1. In ad­
dition to making Mr. Sachs president,
the directors elected Sidney J. Wein­
berg a vice president.

New Omaha Office
Smith, Burris & Company, 120 S
La Salle Street, Chicago, Illinois, syn­
dicate managers for eighteen central
western states on BASIC INDUS­
TR Y S H A R E S , CORPORATE
TRUST SHARES and FIXED
TRUST OIL SHARES are opening
up a wholesale office in suite 1000-02
First National Bank Building, Omaha,
Nebraska, to better serve their dis­
tributors in these investment trust is­
sues.
The officers of the new concern are
Cedric H. Smith, Chicago, president;

P R O B L E M S of correspondent

banks have the direct attention of an officer
of this bank.

Such attention by our officers,

rath er than by the clerical departm ents, ob­
viously works to the advantage of the outof-tow n bank.

THE NORTHERN
TRUST COMPANY
Northwest Corner LaSalle and Monroe Streets

CHICAGO

Central Western Banker, July, 1930

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

L loyd W. P h i l l i p s
Lloyd W. Phillips, executive vice
president and Nelson W. Burris, Chi­
cago, second vice president. The of­
fice will be in charge of Mr. Phillips.
The wholesale business which has
heretofore been handled by Lloyd
Phillips & Co., of Fremont will be en­
tirely handled by the Omaha office and
the Fremont office will be strictly a
retail organization.
The Omaha National Bank has been
appointed as the authorized Paying
Agent on CORPORATE TRUST
SHARES by the Trustee, The Chase
National Bank of the City of New
York and in excess of 6]/2 million dol­
lars in cash distributions were paid
out as of June 30th to CORPORATE
TRUST SHARE holders.
A meeting of the distributors and
dealers of BASIC IN D U S T R Y
SHARES, CORPORATE TRUST
SHARES and FIXED TRUST OIL
SHARES is planned for Omaha on
July 2nd. Cedric H. Smith of Chi­
cago together with Mr. Phillips will
have charge of the meeting.

27
iiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiii*iiiiiiiiii*iiiMiiiiiiiiiiiiiïiiiiiiiit*iiiiiiiMiiiiiiiiiiiiiiiiiiiii*iiiiiiiiii!iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiii

outh Dakota News

The 1931 meeting place has not yet
been selected.

Group Five
The officers are: President, Russell
Bard, Miller; Vice-president, H. A.
treasurer, Jack Kaberna, Wagner. The Kopperud, Lake Preston; SecretaryExecutive Committee includes: Bon treasurer, George M. Townsend, Hu­
Homme — R. W. Griffith, Avon; ron. The Executive Committee in­
Charles Mix—H. F. Warner, Geddes; cludes : Beadle — L. O. Anderson,
Douglas—E. E. Dubes, Armour; Clay Hitchcock; Faulk—J. P. Shirk, Faul—M. J. Chaney, Vermilion; Hutchin­ to n ; Hand — C. W. Gardner, Ree
son—J. W. Ullmer, Menno; Turner— Heights ; Hughes—L. E. Branch, Pier­
F. E. Jackson, Hurley; Union—Law­ re; Hude-— R. J. Drew, Highmore;
rence Authier, Elk Point; Yankton—- Potter— R. Richardson, Gettysburg;
Spink — M. J. Twiss, Doland; Sully
J. M. Lloyd, Yankton.
The 1931 meeting will be held at —Arthur J. Owens, Onida; Kings­
bury—T. H. Meyer, DeSmet.
Wagner.
The 1931 meeting will be held at
Group Two
Huron.
The officers are: President, Claus
Group Six
Hegnes, Baltic; Vice-president, P. J.
The officers are: President, J. H.
Kennefick, Dell Rapids; and Secre­
Kissinger,
Hecla; Vice-president, J.
tary-treasurer, H. W. Mitchell, Mad­
ison. The Executive Committee in­ Schad, Roslyn; and Secretary-treasur­
cludes : Lake—C. A. Stensland, Mad­ er, Robert Weidenbach, Aberdeen.
ison; Lincoln—Louis Jacobs, Lennox; The Executive Committee includes:
Miner—B. R. Laird, Fedora; Minne­ Brown — A. T. Hagen, Claremont;
haha—O. V. Meyhaus, Sioux Falls; Marshall—V. E. Swenson, Langford;
McCook — William Hoese, Spencer; Day — Andrew Hedman, W e b ste r;
Moody—A. B. Larson, Egan; Turner Grant—W. S. Given, Milbank; Rob­
erts—Henry Helvig, Sisseton.
—Earl Hansen, Parker.
The 1931 meeting will be held at
The 1931 meeting will be held at
Milbank.
Madison.
Group Seven
Group Three
The officers are: President, Charles
The officers are: President, W. H. Christen, Roscoe; Vice-president, R.
Shaw, Parkston; Vice-presid'ent, T. A. PI. Brandt, Bison; and SecretaryM. Brisbine, Woonsocket; and Secre­ treasurer, Peter F. Gores, Mobridge.
tary-treasurer, J. M. Patton, Mitchell. The Executive Committee includes:
The Executive Committee includes: Campbell—W. C. Peterson, Pollock;
Aurora — F. R. Loevinger, White Corson—H. W. Batzer, Morristown;
Lake; Brule—W. A. McMillen, Puk- Dewey — Hans Johnson, Isabel; Ed­
wana; Davison—J. M. Newell, Mount munds— H. C. Gross, Bowdle; Mc­
Vernon; Hanson—Jacob Schiltz, Al­ Pherson—A. H. Schumacher, Eureka;
exandria ; Hutchinson—A. G. Bauer, Perkins—J. K. Clark, Lemmon; Wal­
Dimock, Jerauld—L. M. Larsen, Wes- worth—Jacob Helm, Java; Ziebach—
smgton Springs; Jones—C. E. Lange, O. S. Nygaard, Dupree.
Murdo; Lyman — F. A. Smith, OaThe 1931 meeting will be held at
coma; Sanborn — W. A. Anderson, Mobridge.
Letcher.
Group Eight
The 1931 meeting will be held at
Mitchell.
The officers are: President, C. O.
Gorder, Deadwood; Vice - president,
Group Four
The Executive Committee includes:
The officers are: President. F. A. Guy Bailey, Whitewood ; and Secre­
Olson, Toronto; Vice-president, A. R. tary-treasurer, B. E. Colby, St. Onge.
Johnson, Brookings; and Secretary- Butte — T. C. Gay, Belle Fourche;
treasurer, George K. Burt, Water- Custer—-George Havens, Custer; Fall
town. The Executive Committee in­ River -—■G. C. Smith, Hot Springs ;
cludes: Brookings — Robert Henry, Haakon—J. C. Nelson, Philip; JackVolga; Clark—W. A. Hicks, Carpen­ son—L. A. Pier, Belvidere; Lawrence
ter; Codington—Henry Hanten, Wa­ —George Blake, Spearfish ; Meade—
tertown ; Deuel—A. G. Berger, Clear Harold Walker, Sturgis; Pennington
Lake; Grant — George Berg, Stock­ -—E. M. Gentry, Hill City. Nominated
holm ; Hamlin—C. N. Halvorsen, Cas- to Executive Council—W. B. Penfold,
tlewood. Nominated to E x ecu tiv e Belle Fourche.
The 1931 meeting will be held at
Council—J. A. McGillivray, Garden
City.
Belle Fourche.

iiiiiiiiiiiitiiiiiiiiiiiiiiniiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiiiiiiiiiiiiHiiiiiiiiiiiiHiiiiiiiiiiiiiiiiiHiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiiMiiiiiiiimmiiiMiiimiiiiiiiiiniiiiiiiiiiiiiitn

To Popularize Silver Dollar
Eureka, Utah, Banking Company’s
officials, at a recent meeting, decided
to launch a movement against the use
of one and two dollar bills and the
substitution of silver coins. Naturally
the object is to make silver coins more
popular and to stimulate the demand
for that metal which is now at the
lowest price in history and by reason
of such slump there has been a slow­
ing up of operations in every silver
mining camp in the West.
As fast as small currency is taken
to the Eureka bank it will be bundled
up and sent out of town. In cashingchecks no bills smaller than $5 will be
used and much larger quantities of
silver dollars will be shipped into this
district and distributed to the stores
and other patrons of the bank. The
local bank, in its communications to
other financial institutions of the state
will stress the use of silver and there
is a possibility of the movement in
that direction spreading to other parts
of the state, in fact Park City clubs
and lodges have for some time been
working along this line. In agricul­
tural sections, where the people are in
close touch with mining and thereby
beneficiaries of the great mining in­
dustry, it should be an easy matter to
increase the use of silver. Even the
eastern tourists, when they are made
to realize the importance of silver
mining in the prosperity of the West,
will gladly take their change in bright
new silver dollars instead of in cur­
rency.
Group Bankers Elect Officers
''J'VHE LARGEST attendance in the
history of the South Dakota Bank­
ers Association occurred this year
when bankers and their families at­
tended the eight group M eetings
throughout the State. According to re­
port issued by George A. Starring,
Secretary of the Association, 375
banks were represented, with a total
attendance of 1,044.
Group One
The officers are: President, F. S.
Strobehn, Wagner; Vice-president,
Scott Banbury, Geddes; Secretary-


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

Central Western Banker, July, 1930

28
.iiiiiiimtiiiiiiiiiiiiiHiiiiiiiiiiiiiiiiiiiiiiiiiimiiiimimiiiiiittiiiiiiiiiiiiiiiiiiiiiiiiimmiiiiiimtiiiiiiinimnitinnniiiiiiHiiiiiiiiiimiiiiiniiiiiiiHiiniimiin

iuiiiiiiiiiiiiiiiiiiiiiiiimiiiiimiMiiiiiimiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiHiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiimiuii

Elected President
Eugene P. Shrove, senior partner
in the Shrove, Hager & Co. invest­
ment house, and a director and offi­
cer in many large business enterprises,
was elected president of the First Na­
tional bank in Colorado Springs, at a
meeting of the board of directors. Mr.
Shrove, who has been a vice president
of the bank for many years, succeeds
A. H. Hunt, who died May 10.
Irving Howbert, pioneer banker of
Colorado, remains chairman of the
board.
Following the board meeting other
changes in the officials at the First
National were announced. The list in­
cludes two new vice presidents, with
William F. Howbert, formerly cashier
and trust officer, and Jefferson Hayes
Davis, formerly assistant cashier,
sharing the new title with Wilmer D.
Hemming, who has been a vice presi­
dent of the bank for a number of
years.
O. F. Godfrey, who has been with
the bank for many years and who was
an assistant cashier, was named cash­
ier to succeed William Howbert, while
Fred Smith, who has been assistant
cashier for several years, will con­
tinue in that capacity.
James Strachen was named as au­
ditor of the bank, while Carl Mechling

was appointed assistant trust officer.
Mr. Shrove, the new president of
the bank, has been in active business
in Colorado Springs for a great many
years. He is a director and treasurer
of the Holly Sugar corporation, which
he helped organize and is a director
and vice president of the Colorado
Title and Trust company of this city.
He also is a director and vice presi­
dent of the Golden Cycle Mining and
Reduction company; a director of the
Pikes Peak Fuel company; a director
of the Nevada Consolidated Copper
company as well as a director of Cragmor sanatorium and a trustee of Colo­
rado college, to which he recently
made a large gift to build the Shrove
Memorial chapel.
Mr. Shrove also was president of
the old El Paso National bank early
in 1917.
Pueblo Becomes Headquarters
Pueblo, Colorado, will become the
headquarters for national bank exam­
iners operating in southern Colorado,
New Mexico and part of Texas, about
July 1. Heretofore, examiners for
this district made Denver their head­
quarters.
Offices on the fourth floor of the
Federal building will be taken over by
the examiners, it was announced.

W. N. Male, examiner who usually
operates in Pueblo and the rest of the
territory, will be in charge of the of­
fice. Three other examiners will be
stationed there regularly under his
supervision.
Becomes President
The Farmers State Bank of Brigh­
ton, Colorado, has announced that
Mr. Herman J. Schloo of Brighton,
who was formerly an active officer of
that bank, has again become associ­
ated with the bank as a stockholder
and director. At the regular June
meeting of the board of directors of
the bank, Mr. Schloo was elected
president of that institution and ex­
pects to be in active management of
the bank in the future. Mr. Schloo
is a pioneer resident of Brighton and
for years has been identified with the
financial, agricultural and live stock
interests of Adams County and north­
ern Colorado.
E. H. Drinkgern, who for many
years has been active in the manage­
ment of the bank, will continue as an
active officer, resuming the duties of
cashier with Mr. A. H. Schnell and
Mr. H. H. Kramer as assistant cash­
iers. The board of directors now in­
cludes, Herman J. Schloo, John Delventhal, E. H. Drinkgern, John Ehler,
F. D. Krambeck, A. H. Schnell, El­
mer Jennerich, Jacob Kramer and W.
W. Gaunt.
Mr. Clarke, in addition to heading
the Utilities Power & Fight Corpora­
tion, serves as an officer or director
of more than 25 utility corporations,
including electric light, gas and streetrailway companies. Mr. Richardson is
also vice president and treasurer and
a director of the American Bleached
Goods Company, and a director of the
Forraine Manufacturing Company of
Pawtucket, R. I., the Ponemah Mills,
Providence, R. I., and Sayles’ Finish­
ing Plants, Saylesville, R. T.

Above, the newly remodeled home of the Northern Trust Company
of Chicago
Central Western Banker, .Tidy, 1930

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

Opens Cleveland Office
Announcement is made of the ex­
pansion of P. W. Chapman & Co.,
Inc., investment security house, to
Cleveland and the formal opening of
an office in room 440 Terminal Tower
building. Simultaneously, the com­
pany announced the appointment of
George M. Thiedeck as resident man­
ager. The company’s syndicate de­
partment representative in Ohio, Gor­
don B. Guilliams, will have headquar­
ters in the same office.

29

New M exico
News
Bankers Meet
New Mexico Bankers’ association,
Group 3, comprising banks in the Pe­
cos valley, Carrizozo, Alamogordo,
Tularosa and Lovington, met recently
in regular session at the Nickson Ho­
tel. Following the banquet matters of
regular business were transacted.
The meeting was presided over by
G. K. Richardson, of Carlsbad, presi­
dent of the New Mexico Bankers’ as­
sociation and president of the Carls­
bad National Bank.
The bankers were guests of the
First National Bank of Roswell, 22
members and visitors were present.
Special guests of honor were J.
Frank Mitchell, assistant vice presi­
dent of the Exchange National Bank
of Tulsa, Okla.; Carl Charlson, assist­
ant cashier of the Commerce Trust
Company of Kansas City and J. H.
Martin, cashier of the Midland Na­
tional Bank of Midland, Texas. Spe­
cial addresses were made by the three
distinguished visitors.
Floyd Childress, secretary of Group
3, kept the records.
Those present were : G. K. Richard­
son, E. Burch Harrison, F. G. Snow,
Carlsbad; C. E. Mann, Fred Cole, J.
E. Robertson, L. B. Feather and W.
M. Linell, Artesia; W. A. Losey, R.
W. Conner, Hagerman ; D. C. Berry,
Lexington; J. F. Hinkle, Claude
Hobbs, A. Hanny, J. E. Moore, Paul
Schultz, Floyd Childress, W. J. McInnes and Wayne Ake, Roswell.

Favors Agricultural Institute
An endowed institution with a capi­
tal of at least $10,000,000 to aid agri­
culture through research and in any
other way possible would perform an
invaluable service and should be cre­
ated in the near future, Chairman Al­
exander Legge, of the federal farm
board, said recently.
Legge revealed he has personally
favored such an organization for some
time and has discussed plans with a
number of eminent attorneys who ap­
proved the project. An outline of the

plan has been drafted in tentative
form, he added.
Adds Two Directors
The American Express Bank &
Trust Company has announced two
additions to its board of directors.
They are Harley L. Clarke of Chica­
go, president of the Utilities Power &
Light Corporation, and Sinclair Rich­
ardson, president of the Kelsey-Wilson Textile Corporation of New
York.

The Morrison is the
tallest hotel in the
world — 4-6 stories
high — with 1,950

W h e n completed,
theMorrison w ill be
the world’s largest
hotel, with 3,450
rooms.

Chicago’s

MORRISON HOTEL
T a lle st H o tel in the W o r ld

Aztec Banks Merge
The Citizens State Bank of Aztec.
New Mexico, and the Aztec State
Bank consolidated on June first and
all banking business in Aztec is now
transacted at the Citizens bank build­
ing. The new institution is known as
the Citizens Bank and has resources
of over $400,000.00.
The officers of the new Citizens
Bank are A. G. Ramsower, president,
John J. Emmors of Gallup, vice presi­
dent, and J. A. Pierce, cashier.
Publishes Bond Book
A new ready - reference book, de­
signed to aid municipal bond buyers
throughout the country, has been pre­
pared for distribution by C. F. Childs
& Company, Inc., the oldest house in
America specializing in Government
securities.

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

46 Stories H ig h

1,950 Rooms -- $2.50 Up
500 Rooms Being Added

E very guest room is outside, with bath,
running ice w ater, bed-head lamp and
Servidor. Each floor has its own house­
keeper and the hotel’s garage has extensive
facilities for car storage. Rates are ex­
tremely m oderate — $2.50 up — because
valuable subleases at this location pay all
the ground rent and the saving is passed
on to the guests.

Closest in the City to Stores, Offices,
Theatres and Railroad Stations
Central Western Banker, .Tidy, 1930

30
iiiiiiiiiiiimiiiiiiiiiiimiiiiiiimiiiiiiiiMiiiimiiHiiiiiimimiiiimiiiiiiiimiimiMiiiMMiiiiiiiiiMiimMiiimiimiMitniiiMmiiiiiiimiiiiiiiMi

Kansas News
iimimiiiiiiiiiiiiimiiimiiiiiiiiiiiiiiiiiimiiiiiiiiimuiiiiiiiiiiiiiiiiimiiiiiiiimiiiiimiiiiiimimiiimiiimiimiiiiiiiimiiimiiiiiiiiiiimtiii

New Bank at McDonald
A new institution, the Peoples State
Bank, opened its doors in McDonald,
Kansas, on June 2.
The new bank is chartered with a
capital of $20,000 and $2,000 surplus
and is being backed by prominent men
in both McDonald and Atwood.

Vice President of Association
Matt Weightman, widely known
Topeka, Kansas, banker and political
leader, has been elected vice president
of the American Bankers Association
as representative from Kansas. Mr.
Weightman’s nomination, which was
made by a committee at the recent
meeting of the Kansas Bankers Asso­
ciation in Wichita, has been confirmed
and he will immediately take up the
duties of his office. He succeeds
Frank J. Miller, president of the First
National Bank of Ottawa.

Officers of the new bank are: J.
J. Fleming, Atwood, President; J. T.
Short, Atwood, vice president; and
Ralph McLaughlin, Oberlin, cashier.
The city of McDonald has been
without a banking institution for the
past two years, since the Farmers
State Bank closed its doors in March
of 1928. Since that time, farmers and
business men have been forced to seek
banking facilities in other towns.

Elected Vice President
Marlin Casey, trust officer of the
Columbian Title and Trust company,
Topeka, Kansas, was elected vice
president of the trust division of the
Kansas Bankers’ association at its an­
nual election in Wichita.
Casey, who has been trust officer
of the Columbian company for only
three months, is in line for the presi­
dency of the trust division next year.

Lyons Banker Honored
Fred Long, president of the Lyons
National bank, was honored at the
state bankers convention at Wichita,
Kansas, recently, when he was elected
vice president for Kansas, of the Na­
tional bank division of the American
Bankers association.

Kansas Banks Merge
Merging of the Home State Bank,
Havana, Kansas, with the Niotaze
State Bank, Niotaze, Kansas, was an­
nounced recently by the state banking
department.
Both were described by the bank­
ing department as small banks.

Florence Bank Reopens
(C ontinued from page 18)

An audit of money collected on
stockholders’ liability was to be made
also.

The Shallenberger audit was under
the law passed by the 1929 legislature,
providing for an inquiry of failures
of state banks during the last ten
years. The affairs of 175 institutions
were gone into, and separate reports
published on 50. Thirty are still under
investigation.
The legislature appropriated $150,000 for the audit. Mr. Shallenberger
said it had cost, up to the end of June,
about half the appropriation.
Budget System
“The best way for you to straight­
en out your financial difficulties is to
live within your means for a while,
until you get square.”
“Within our means? I should say
not! We may be poor, but we’re not
as badly off as all that.”-—Kansas City
Star.
I ABILITY OF SHAREHOLD­
ERS in farm loan banks is to be
determined in litigation begun in New
Haven, Connecticut. Henry M. Lang­
worthy, receiver for the Kansas City
joint stock land bank, has filed suit in
Supreme Court against the Second
National Bank as administrator of the
estate of Smith T. Bradley, deceased,
contending that shareholders are lia­
ble under the farm loan act for the
par value of their stock. At the time
the Kansas City bank was declared in­
solvent Bradley owned stock at a par
value of $2,700.00. When his will
was probated the receiver claimed $2,700.00 as Bradley’s share of liability
in the bank’s debts.

AUSTRALIA

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

w h ic h

is a m a l g a m a t e d

THE

1 S 17

W ESTERN

A U S T R A L IA N

BANK

P A I D - U P C A P I T A L ____________________________________
R E S E R V E F U N D ___________________________________________________________________
RESERVE

L IA B IL IT Y

OF

$ 3 7 ,5 0 0 ,0 0 0
3 0 ,7 5 0 ,0 0 0

P R O P R IE T O R S —

3 7 ,5 0 0 ,0 0 0
$ 1 0 5 ,7 5 0 .0 0 0

Aggregate Assets 30th September, 1929, $454,031,485
A G E N T S— F IR S T

N A T IO N A L

BANK,

OM AHA,

N EBRASKA

HEAD OFFICE, GEORGE ST., SYDNEY

GENERAL

M ANAGER, ALFRED

C H A R L E S D A V ID S O N

LONDON OFFICE, 29 THREADNEEDLE ST., E. C. 2

5 8 8 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
N ew G u in e a , an d L o n d o n .

Z e a la n d ,

F iji,

Papua,

M a n d a ted

T e r r ito r y

of

THE CENTRAL WESTERN BANKER, OMAHA,

P u b l i s h e d by D e P u y P u b l i s h i n g C o m p a n y
410 A rth u r Bldg., Omaha, Nebraska

C l if f o r d

D e P u y , P u b lish er

G e r a l d A. S n id e r , A ssociate P ublisher

W m. H . M aas, 1221 F ir s t N atio n al B ank B ldg., Chicago, V ice-P resident

Central Western Banker, July, 1930


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

R.

W.

M oorhead,

E d ito r

L. D . V a n D o r a n , A ssociate E d ito r

F ra n k P. Syms, 25 W est 45th S tree t, N ew Y ork, V ice-P resident

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

Continental Illinois
Company
Underwriter, wholesaler and
retailer of investment securities

CHICAGO
NEW YORK
SAN FRANCISCO
European Representative

LONDON
Omaha Office
1236 First National Bank Building

Capital • 20 million dollars

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