The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
1
D ecem b er 1927
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
■H
¡¡v?
a— ^
4
F//i
O&ucarit,
swamp us
\?tt
!
a
O A D S O F M A I L are rej ceived here every day, and
each item is given the kind of
care you might most hopefully
expect.
Out - of - town items
are despatched at once on their
collection journey. W e miss no
trains. If you are not already a
correspondent, give our
service a trial.
I
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
3
Just Between Us
J
M i t c h e l l , presiden t
L.
ohn
the
F irst
N ation al
of
B ank,
S iou x
C ity, in a recent letter s a id :
‘ ‘ The
service y ou ren der is v ery pleasing
READ THIS SUMMARY
of W H A T YOU’LL FIND
to us and goes to p rove that y ou
are con tin u ou sly on the jo b in the
In This December Number
of the
interests o f bankers in this great
te rritory . ’ ’
A n oth er recent letter v e ry m uch
ap p recia ted is that o f F re d D.
Stone, m anager o f the service d e
partm en t o f the F irst N ational
B ank o f L in coln , w ho says, ‘ ‘ F ro m
N o rth w e ste rn B an k er
Num ber 485
DES M O I N E S
32nd Year
com m un ication s received since the
Nebraska b a n k ers’ con vention , I
feel sure y ou r N ovem ber num ber
was
read
w ith
a
considerable
am ount o f interest, n ot that the
w riter h ad an y p art in the p rogram ,
but due to the fa c t that the w hole
con ven tion seemed to radiate w ith
interest reg a rd in g the progress and
p rosp erity
of
Nebraska
and
the
Page
ACROSS FROM THE PURLISHER___________________________
8
By Clifford DePuy
Frontispiece “ Yellowstone Falls” _______________________________
10
Causes and Remedies for Bank Failures_________________________11
ARE W E P LAYIN G TOO M UCH G O L F ?____________________
15
A Credit File That Pays__________________________________________ 16
corn belt states.
‘ A Y e w estern p eop le m ust find
ISHPODAR BROADCASTS SOME DO’ S AND DON’T ’S____ 17
m ore o f the good th in gs to talk
about, and less o f the tem pora ry
Houston Convention Photographs_______________________________ Y8
reverses
wdiich
we
have
e x p e ri
By Roscoe Macy
DO OUR SPECIAL SAVINGS CLUBS P A Y _____________________19
“ News and Views” ________________________________________________ 20
e n c e d .”
“ No More Guessing on Credit” _________________________________ 21
w
e call
y ou r special attention to
the fo llo w in g articles in this is s u e :
*1Too M uch G o lf in A m erica ? ” A
hot discussion o f w here we are g o
in g and w h y. Som e bankers say
too m uch g o lf, football-m adness and
sports in san ity is taking our m inds
fro m in d u stry and th rift. Others
say, ‘ ‘ the business m an who is on ly
a business m an is not a h ow lin g su c
cess in this w orld . T his also in
cludes a fra n k discussion o f fa rm
problem s, etc.— A n oth er clever M a cy story b ro a d
casted fro m Ish p od a r, keeper o f the
roy a l cou n tin g house o f Sheckem,
w ith p len ty o f sage banking advice
scattered th rou gh it. M ore p h ilos
op h y therein than in m an y a book
on banking.
“ B u ild in g B usiness in T ow ns
o f Less T han 5,000 P o p u la tio n ,”
to appear in the J a n u a ry issue,
con tain s
real
fa cts
fo r
cou n try
bankers. The m oral o f it is to “ do
som ething and be so m e th in g ” if
y o u wish to see y o u r bank grow .
IO W A LAND B U YIN G CO M PA N Y BEGINS ACTU AL
W O R K ______________________________________________________ 22
“ Here and There in Nebraska” ____________________________ .___ 27
By H. H. Haynes
Personal Paragraphs___________________________________________
Bonds and Investments___________________________________________ 45
Insurance Section_________________________________________________71
Bankers Wants____________________________________________________ 76
South Dakota News_______________________________________________ 77
Nebraska News___________________________________________________ 81
Minnesota News___________________________________________________ 85
North Dakota News______________________________________________ 89
Iowa News_____________________________________________________ __ 91
“ In the Directors’ Room” _______________________________________ 105
Index to Advertisers_____________________________________________106
The Oldest Financial Journal West of the Mississippi
Member, Audit Bureau of Circulations
N orth w estern B anker, published m onthly by the D e P u y Publishing Com pany, In c., at 535 7th
street, D es M oines, Iowa,. Subscription, 50c p er cop y, $3.00 p er year. E ntered as second-class
m atter at the D es M oines post office. C opyrighted, 1927.
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
30
D ecem b er 1927
4
Wishing You a
Merry Christmas
Let us be among the first to extend the
season’s greetings, confidently anticipat
ing a prosperous New Year,
We are abundantly prepared to serve the
bankers of Iowa, and especially invite at
tention to the facilities afforded by our
Bond Department, not only for your own
investments but for those of your clients.
/ C APITAL flSS.liI*3000.000\_
OFFICERS
P resident
V ice P res.
V ice P res.
V ic e P res.
Cashier
A sst. Cash.
A sst. Cash.
A sst. Cash.
A sst. Cash.
A sst. Cash.
A sst. Cash.
A sst. Cash.
A sst. Cash.
H om er A , M iller
Clyde E, B renton
Geo. E. Pearsall
A lb ert J. R obertson
J.
R . Capps
R. L . Chase, Jr.
Jam es F. H art
W m . M . B randon
J.
B urson
Sherman W . F ow ler
A.
J. W arnke
W infield W . Scott
H a rry G. W ilson
DIRECTORS
Geo. N. A yres
Clyde E. B renton
H ow a rd J. Clark
G ardner Cowles
J. H . Cownie
E. C. F inkbine
J. B. Green
W m . C. H arbach
F. H . Luthe
M.
M andelbaum
H om er A . M iller
Geo. E. Pearsall
R alph H . Plum b
M.
Shloss
E.
R . Stotts
O.
P . Thom pson
G.
M. V an E ver a
Carl W eeks
Iow a National bank
D es M oines Savings Bank
and
Des M oines
N orth w estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Trust Co m pan y
o4
Cedar Rapids Dank
T ill
'''ijlii Jllpüf î
(»»nsi5 ìì - ììM im ià iil
I hil il i .» h hhmi.tu
Itili H«H
Servicing cAll loWa
“ The Merchants" Is Your Logical
Cedar Rapids Correspondent
BECAUSE—
T h e M erchants N ation al was organized in
1881.
It has been conducted and has pros
pered on the sound principle o f progressive
activity regulated by conservative banking.
O ver a period o f 4 6 years this p olicy has
bu ild ed a grow ing and satisfied list o f cor
respondent banks. W e w ill gladly serve you .
MERCHANTS
N A T IO N A L
C ed ar R apids
BANK
Iow a
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
6
®®®®®®®®®®®®®®®®®®®<¡ ìlOiOiOIOIOIOIOIOIOIOIOIOXOIOIOIOIOIOIOIOIOXOIOIO^
Excerpts from a letter
one o f a strong and practical series issued to farmer cus'
tomers by the First Rational B an\of Tahlequah, 0\la.
H E seat o f our
y
national wealth
D ear Sir:
A u g u st 30, 1927
T h e officers and directors of the F irst National B an k of
T ahlequah have alw ays advocated diversified farm ing as
security against crop failure.
T h e prim ary aim of the farm ers is not only to m ake a liv
in g for them selves but to produce crops in such quantity
that a surplus m ay be raised and m arketed hoping thereby
to realize a profit. T h e m ajor crops in C herokee County, for
the past, consist of wheat, oats, corn and cotton. T h ese crops
oftentimes pay, but m ore often th ey do not. T h is year we
have seen disappointment to the oats and w heat grow er and
the outlook for cotton is about the most distressing that our
farm ers have ever experienced. C orn is about the only crop
apparently that will yield anything like a satisfactory return.
continues to be agri-
culture*
Agriculture
is also the basis o f
community wealth*
T h e progressive
local banker builds
local farming by pre
cept and example.
I n t e r n a t io n a l H ar vester C o m p a n y
606 S o. M ichigan A v e. Pf America
Chicago, Illinois
[In co rp o rated J
Som e farm ers m ay not be able to meet their store accounts
this year due to the generally poor propects for cotton. From
every indication the cotton crop is go in g to be the smallest
in years although the price indications are encouraging. It
is not too soon for each and every farm er in C herokee C ounty
to consider seriously his situation and endeavor to make
some plans that w ill enable him to hold on to his posses
sions. T h a t is, keep such part of his live stock, especially his
m ilk cow s and you n g cattle, brood sows, and hogs, because
they are the soundest and best investments on the farm. W ith
abundant forage crops of all kinds and perhaps, the b iggest
crop of corn raised in years, the farm er w ith cattle and a few
brood sows, properly handled, w ill turn into a prosperous
condition in the near future.
W e unhesitatingly recomm end the purchase of cream sep
arators even though you are m ilking but tw o cows. B y doing
this it w ill soon be discovered that cow s are a paying invest
ment on the farm, affording food for the fam ily and will produce
a cash incom e every w eek in the year. T h e n more m ilk cow s
will be added and full use of the cream separator realized.
T h e First National B ank of T ahlequah is ever alert to aid in
the developm ent of this county and w e shall deem it a pleasure
to have you consult us at any time. W e shall be glad o f the op
portunity to lend every encouragem ent necessary in aiding the
farm ers of our county to get upon a sound basis and to follow a
safe policy.
Very respectfully, D. O. S C O T T , President.
M cC O R M IC K -D E ERIN G
Farm Operating Equipment, Sold and Serviced Through 92 Company-Owned
Branches and 13,000 McCormick-Deering Dealers in the United States.
Mr. Roy W ood ru ff o f Sullivan, Illinois, an enthusiastic p o w er farm er, is substituting im proved farm
m achines f or h an d labor w h erever possible. H e is sh o w n at th e w h e e l o f the M cC o rm ick -D eerin g 15-30
T ra cto r, w h ich is h itch ed to a N o. 8 pow er-drive M cC o rm ick-D eerin g H arvester-Thresher. T h is m odern
m eth od o f com b in ed harvestin g and th resh in g is saving th e farm ers 20 cents per b u sh e l o v e r th e u su al
m ethods in th e harvesting o f grain.
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
7
Leading banks,
business houses and
industries everywhere
safeguard funds with
T O D D S Y S T E M O F C H E C K P R O T E C T IO N
The Protectograph eliminates
a large percentage of all check
frauds by preventing raised
amounts. It is made in a
variety of standard models,
one for every type of business
— $37.50 up. For private use
the Personal Protectograph at
$20 has a nation-wide popu
larity. Only Todd can make
a Protectograph.
S 1916
lArC_Ckf
'Olii
C-,
U
VO';::
23Í1HJÍ,....... 2 38 **
Todd Greenbac Checks, with
their patented self-canceling
features, eliminate another
major source of possible check
losses by preventing change
of payee’s name, date and
number and “ counterfeiting."
The instant the forger’s acid
is applied countless imprints
of the word “ VOID” appear.
Standard Forgery Bonds
cover
the
rem aining
check - fraud possibilities,
namely, outright forgery
of signature or of endorse
ment. As preferred risks,
Todd users qualify for
such bonds at large sav
ings from the Metropolitan
Casualty Insurance Com
pany, New York.
A partial list o f Todd users
/E tn a L ife Insurance Co.
A ja x R ubber Co.
A labam a P ow er Co.
Allis-Chalm ers M fg. Co.
A lum inum Co. o f A m erica
A m erican E xpress Co.
A m erican L a F ra n ce F ire Engine
Co., Inc.
A m erican L a u n d ry M achine Co.
A m erican R a d ia tor Co.
A m erican R ollin g M ill Co.
A m erican T hread Co.
A rm stron g Cork Co.
A ssocia ted Oil Co.
The A tla n tic Refirfing Co.
A tw ater Kent M fg. Co.
A uburn A u tom ob ile Co.
B arber A sphalt Co.
B earings C om pany o f A m erica
Bemis Bros. Bag Com pany
The B erger M fg. Co.
Boston & A lb a n y R. R.
B oston & M aine R a ilroa d
The B radstreet Co.
B runsw ick Balke Callender
C om pany
B uckeye Steel Castings Co.
The Bucks Stove & R an ge
C om pany
E dw . G. B udd M fg. Co.
F. N. Burt Co.
Cannon M fg. Co.
The C elotex C om pany
C entral R a ilroa d o f N. J.
C erto C orporation
Cham pion Spark P lug
Chase & Sanborn
Chicago, M ilw aukee & St. Paul
R ailw a y
City o f R ochester, N. Y .
The C olorad o Fuel & Iron
C om pany
Colum bia R iv er Canning
C om pany
C olum bia Steel Corp.
C ontrollers Office, Sacram ento,
C alif.
Corning Glass W orks
Corn E xchange Bank, N ew Y ork
The Curtis P ublishing Co.
D elco R em y Co.
D elaw are, L ackaw ann a &
W estern R. R.
D odge Bros.
D onner Steel Co. Inc.
Dunlap T ire & R ubber Co.
E agle P icher L ea d Co.
E astm an K od ak C om pany
E lectric A u to L ite Co.
E lectric S torage B attery
C om pany
E quitable Trust Co. o f N. Y .
The Estate Stove W orks
F ed eral R a d io Corp.
F irst N ational Bank o f City o f
N. Y .
F o rd M otor Com pany
G eneral A m erican T ank Car
C orp oration
G eneral P etroleum Co.
G eneral T ire & R ubber Co.
G ood y ea r T ire & R ubber
C om pany
G ran d T ru nk R a ilw a y System
G raybar E lectric Co.
G reat N orthern R ailw a y
G u aran ty Trust Co.
H am ilton Brown Shoe Co.
H am ilton W a tch Co.
H a rbison-W alker R e fr.
C om pany
W . A . H arrim an & Co., Inc.
H art Schaffner & M arx
Hazel A tlas Glass Co.
H ercules P o w d e r Co.
The H om e Insurance Co.
H om er Laughlin China Co.
H udson M otor Car Co.
H um ble Oil & R efining Co.
Illin ois W a tch Case Co.
Indiana L im estone Co.
Ingersoll R an d Co.
International H arvester
Com pany
Johnson & Johnson
K roehler M fg. Co.
L aC lede Steel Co.
Lehn & Fink, Inc.
L ibby, M cNeil & L ibby
L ouis K. L iggett Co.
M acF ad d en Publications
M agnolia P etroleum Co.
M arland R efining Co.
M assachusetts M utual L ife
Insurance Co.
Michaels, Stern & Co.
M ichelin T ire Co.
M ichigan Central R ailroa d
M iller R ubber Co.
M oon M otor Car Co.
F rank A . M unsey Co.
N ational Cash R egister Co.
N ational Carbon Co., Inc.
N ational City Bank o f
N ew Y o rk
N ational L e a d Co.
N ational Silk D yeing Co.
N ational Tw ist D rill & T ool Co.
N ew Y o r k Central R . R.
N orth East E lectric Co.
P a ige M otor Co.
P aine, W ebb er & Co.
P arke, Davis & Co.
P ennsylvania R . R.
The P ep sod en t Co.
The P hiladelph ia E lectric
C om pany
P ittsburgh P late Glass Co.
P ostum Com pany, Inc.
P rest-O-Lite
P ublic S ervice Co. o f N. J.
The R obbins & M yers Co.
R ochester Gas & E lectric
C orporation
R eo M otor Car Co.
John A . R oeblin g’s Sons
R epublic Stam ping &
E nam eling Co.
R om e Brass & C opper Co.
D. A . Schulte, Inc.
Sears, R oebu ck & Co.
Sing-Sing P rison
The Singer M fg. Co.
Skelly Oil Co.
Southern P acific R ailw a y
Southern States Steel
C orporation
S pencer, K ellogg & Sons
S tand ard S anitary M fg.
Com pany
S tandard Oil Co. o f N. J.
F. B. Stearns Co.
Strom berg-Carlson M fg.
C om pany
The S ym ington Co.
Texas Com pany
T o le d o Scale Co.
U nited Cigar Stores Co.
U nited E lectric L igh t Co.
U nited F ru it Co.
U nited H otels Co.
U. S. In d ustrial A lcoh ol
C om pany
U nited States L ight & H eat
Corp.
U nited States R ubber Co.
U niversal P ictures Corp.
V irgin ia B ridge & Iron Co.
The V itap hone Corp.
The W a rn e r Bros. Co.
F. W . W ooh vorth Co.
W m . W rigle y, Jr., Co.
W estinghouse A ir Brake
C om pany
W estinghouse E lectric &
M fg. Co.
Yaw m an & Erbe
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Desk
A c r o s s ihe
from
ihe Publisher
H E R E is p r o b a b ly no eq u a tion in the b a n k
in g business that cou n ts as m uch as p e r
son a lity.
W e do business w ith p eop le
becau se w e lik e them , or co n v e rse ly , w e d o n ’t do
business w ith them becau se th eir p erson a lities d o
n ot ap p eal to us.
Y o u and 1 k n o w that a b a n k er m ust have som e
th in g besides a fine p e rso n a lity to su cceed in the
b a n k in g business, but the rig h t k in d o f a p e rso n
a lity is a real asset in a business w h ich is as p e r
son al as the b a n k in g business.
W h ile a tte n d in g a b a n q u et the oth er n igh t, one
o f the speak ers to ld o f the resea rch w h ich the
C arnegie In stitu te h ad m ade to ascerta in the f a c
tors w h ich had c o n trib u te d m ost to the su ccess o f a
la rg e g rou p o f engin eers.
These m en w ere all c o l
lege gradu ates and had been especially trained in
en g in eerin g , b u t a c c o r d in g to th eir ow n testim on y,
th ey a ttrib u te d 15 p er cen t o f th eir su ccess to th eir
en g in eerin g a b ility , and 85 p er cen t o f th eir su c
cess to th eir p erson alities.
m ake such a su rv ey a m on g b a n k ers i f the same
p ercen ta g e w o u ld h o ld true.
P erh a p s not.
B ut
in any event, p e rso n a lity does p la y a v e r y v ita l
p art in the m an agem en t o f a b a n k an d is a q u a lity
Avliich sh ou ld be d e v e lo p e d b y the officers if the
bank is to be som eth in g m ore than a m ere stora ge
p lan t fo r the finances o f the com m u n ity .
ask ed the q u estion :
The
B anker
N o r th w ester n
has ju st com
p le te d a su rv e y am on g
2,000
‘ ‘ W h a t do y o u con sid er the
th ree m ost im p orta n t fa c to r s in ch o o sin g a c o r r e s
p on d en t b a n k ? ”
in g are p erh aps the best :
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
to co n sid e r in ch o o sin g a c o rre sp o n d e n t ban k , and
lik ew ise w e b eliev e th at th ey are th ree o f the m ost
im p orta n t fa c to r s fo r a cu stom er to co n sid er in
c h o o sin g the ba n k w ith w h ich to d o his business
in his ow n com m u n ity .
Unusual
U nusual serv ice in the b a n k in g
S e w iC Q
business is a lw a y s a p p re cia ted b e
cause it is u su a lly ou tsid e o f the
re g u la r lines o f b a n k in g serv ice w h ich are cu stom
a rily ren d ered .
“ W h a t is the m ost u nu su al serv ice a co rre sp o n
dent b an k ever re n d e re d fo r y o u ? ’ ’ w as one o f the
questions the N o r t h w e s t e r n B a n k e r asked in its
recen t b a n k su rvey.
usual serv ice in clu d e the fo llo w in g :
“ W e asked our co rre sp o n d e n t b an k w h at
th ey th ou gh t o f the gra in m arket.
T h ey
ca lle d in three o f th eir cu stom ers w h o w ere
m em bers o f the ex ch a n g e and ask ed them fo r
th eir in d iv id u a l o p in ion o f the m a rk et at that
tim e, and then a fte r secu rin g th eir op in ion s,
ou r co rre sp o n d e n t ban k ga v e us th eir ow n
in d iv id u a l an alysis o f the m a r k e t.”
“ In 1920 and 1921 th e---------------------- b a n k o f
M in n ea p olis to o k care o f us th rou g h the
p e r io d o f in flation , and the a tten d a n t evils
o f the
la n din bw
oom
, and
banks,
h ich
is n ever re fu se d us any
loa n w e asked fo r , even w h en the F e d e ra l R e
serve B a n k fe ll d ow n and fa ile d to fu n ction ,
as w e w ere led to b elieve it w o u ld .”
A m o n g the h u n d red s o f rep lies
that have been re ce iv e d to this qu estion the fo llo w
N orthw estern B anker
C erta in ly these are th ree v e r y im p o rta n t fa cto rs
A fe w o f the rep lies to this qu estion abou t u n
I am w o n d e r in g if the C arn egie In stitu te w ere to
Choosing a
Correspondent
Bank
1. S e cu rity , N O T size o f bank
2. P erson a l a cq u a in ta n ce w ith its officers
h a n d lin g y o u r ow n d ep a rtm en t
3. A b ility and w illin g n e ss to assist in tim e o f
n eed w ith o u t to o m u ch red tape.
D ecem b er 1927
“ W h e n our co rre sp o n d e n t b an k sent us all
o f the cash w e w a n ted b y airp lane w h en w e
9
all, insure that u n sou n d p o licie s shall be ch eck ed
h ad a ru n on a cco u n t o f the clo sin g o f the
oth er b a n k in ou r t o w n .”
lo n g b e fo r e so lv e n c y is en d a n g ered .
“ F u rn ish ed us $25,000 cu rr e n c y at one tim e
d u rin g the cu r r e n c y p a n ic o f 1907, w ith o u t
prem ium , w h en w e th ou g h t w e c o u ld n ’t get
it a n y w h ere in the w h ole w o r l d .”
Should
Secretaries Be
Merchandisers ?
‘ P u rch a se d tick e t f o r a fo o t b a ll g a m e .”
“ S ta n d in g b y us to the lim it w h en c o n d i
tion s w ere so u n certa in , an d g iv in g us g o o d
a d v ice p r io r to the slum p that ru in ed so m an y
banks. ’ ’
“ O ur p rin cip a l N e w Y o r k co rre sp o n d e n t
has m et steam ers fo r us and assisted in lo o k in g
a fte r affa irs o f ou r cu stom ers in no w a y d i
r e ctly co n n e c te d w ith the b a n k in g b u sin e ss.”
U n u su al service m ust be b a ck e d o f cou rse b y the
re g u la r d a ily serv ice w h ich co v e rs the rou tin e m a t
A
se creta ry
of
a
state b a n k e r s ’ associa
tion
sh ou ld
be
em
p lo y e d fo r the p u rp ose
o f m a in ta in in g as n e a rly as p ossible a 100 p er cent
m em bership in the a ssocia tion ; m a k in g su ggestion s
that w ill be h e lp fu l to the m e m b e rs; co o p e ra tin g
w ith the v a rio u s com m ittees o f the org a n iza tion ,
p re p a rin g su rv ey s on to p ics o f gen era l in terest to
the m em bers, an d serve in an y oth er w a y w h ich he
th in ks w ill be h e lp fu l an d ben eficial.
In ord er to
a ccom p lish the o b je c ts ou tlin ed a b ove, it is n ot n e c
essary fo r an y state se cre ta ry to ru n a dep artm en t
store or to en ga ge in the m erch a n d isin g or p u b lish
in g business.
H a y n es
M cF a d d en ,
se cre ta ry
of
the
G eorg ia
ters o f co rre sp o n d e n t b a n k rela tion s, bu t it is in
B a n k e r s ’ A sso cia tio n , in sp ea k in g b e fo re the state
terestin g to ob serv e that e v e ry b an k rem em bers
se c r e ta r ie s’ section o f the A m e rica n B a n k e r s ’ c o n
the unusual things done fo r it, and especially when
ven tion at H ou ston , sa id :
th ey com e at a tim e o f stress an d storm .
no a ssocia tion sh ou ld b ecom e a d ep a rtm en t store
“ It is m y op in ion that
an d en g a g e in the sale o f ty p e w rite rs, a d d in g m a
R e d u c in g
H o w to red u ce the num -
Batlk Failures
*3er
^ank fa ilu re s in the
U n ited States, w as g iven
chines, sta tion ery , d ep osit slips, b la n k ch eck s and
oth er supplies.
The d a n g e r in the ex ten sion o f
such a ctiv itie s is tw o -fo ld .
In the first p lace it
v e ry ca r e fu l stu d y d u rin g the past y ea r b y the
sets up betw een the a ssocia tion and its m em bers
E co n o m ic
the rela tion sh ip o f m erch a n t and cu stom er.
P o lic y
C om m ission
of
the
A m e rica n
B a n k e r s ’ A sso cia tio n , and fo r m e d the basis o f its
This
atm osph ere easily in v a d es and d etra cts fro m the
eth ica l m ission an d fr o m the p ro fe ssio n a l d ig n ity
re p o rt to the co n v e n tio n at H ou ston .
D u rin g the past six y ea rs the C om m ission fo u n d
that a b a n k e r s ’ a ssocia tion sh ou ld m ain tain w ith
th at 3,800 banks, or m ore than on e-eigh th o f the
its m em bers.
tota l n u m b er o f ban k s in the U n ited States, have
putes are to o n u m erous to recom m en d the d e p a rt
been o b lig e d to su spend o p era tion s.
m ent store idea fo r general a d o p tio n b y b a n k e r s ’
a ssociation s. ”
The m ain
reason fo r this w as due to the excessiv e num ber
The p ossib ilities o f com m ercia l d is
o f ban k s an d the fa c t that m an y ban k s w h ich co u ld
Som e secreta ries in a d d itio n to th eir desire to
go along n icely in fa ir weather, were not able
to w ith stan d the financial storm s when th ey came.
m ake d ep a rtm en t stores o f a ssocia tion h ea d q u a r
The C om m ission believ es that b a n k fa ilu re s in
ters, h ave also fe lt th at th ey w ere w ell qu alified to
en ter the p u b lish in g business and have co n se
the fu tu re can be re d u ce d “ th ro u g h the a d o p tio n
q u en tly en g a g e d in the business o f ed itin g and
o f arra n g em en ts d efin itely d esig n ed to m eet o b
v iou s d e fe cts that e x p e rie n ce has d isclo se d in our
association s, w h en as a m atter o f fa c t this fu n c
p u b lish in g b a n k in g jo u rn a ls in b e h a lf o f th eir
tion has no m ore to d o w ith the op era tion o f a
system o f in d ep en d en t lo c a l unit' banks.
“ In the ju d g m e n t o f the C om m ission, h o w ev er,
state b a n k e r s ’ a ssocia tion office than it w o u ld be
this o b je c tiv e can n ot p o ssib ly be rea ch ed th rou g h
if th ey w ere sellin g b on d s, b an k a d v e rtisin g serv
the im p o sitio n o f fu r th e r le g isla tiv e re strictio n s
ice or m a h o g a n y desks.
co v e r in g the details o f b a n k in g operation s.
The state secreta ries th ro u g h o u t the cou n try ,
e x istin g
w h o are k n o w n as the best and m ost efficient in
leg isla tio n w o u ld d o m uch, but rem ed ies fo r bank
th eir re sp e ctiv e org a n iza tion s, are the ones w h o
fa ilu res, to be a d e q u a te ly effe ctiv e , m ust be d e
h ave d e v o te d th em selves to the m ain o b je c ts fo r
“ A
m ore im m ed iate
e n fo rce m e n t
of
sig n ed to red u ce the n um ber o f fin a n cia lly w ea k
w h ich th eir a ssocia tion s w ere o rg a n ized , and have
banks, secu re m ore co m p e te n t officers su p p o rte d
not a llo w e d th em selves to d issipate th eir en ergies
b y resp on sib le and a ctiv e d ire cto rs, and, a b ove
on a h a lf d ozen sidelines.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
11
The Causes of Bank Failures
and
Som e Possible Remedies
with 158 also show at
N THE limited time
Correction of defects in our banking structure
least a comparatively
at its disposal, the
rather than further restrictions on loans and in low casualty rate. In
Commission has not
the four southern dis
been able to make a
vestments is the best preventive of bank failures,
tricts o f Richmond, A t
comprehensive investi
says the Econom ic Policy Commission in its re lanta, St. Louis, and
gation o f the particular
Dallas, on the other
b a n k i n g transactions
port on bank failures at the A . B. A. Convention.
hand, there were 1,117
that have involved seri
failures during this sixous losses and numerous
year period, while the three remaining
tions. Still other tottering banks have
failures. A preliminary examination of
districts present a still more unfavorable
this aspect o f the matter, however, dis been taken over by stronger neighbors, in
record, the Chicago district with 437 fail
closed great diversity among these un some instances with disastrous effect upon
ures, Kansas City with 590, and finally the
fortunate operations— a diversity so wide the solvency o f the absorbing institution.
astounding number o f 999 failures in the
These failures and near failures do not
that it has forced upon the Commission
Minneapolis district.
imply a weak condition and poor manage
the conviction that it is hopeless to seek
A variety o f adverse local influences,
ment in the case o f the majority o f banks
for a solution o f the bank failure problem
throughout the country, but they do indi among which may be mentioned a succes
in main reliance upon the imposition of
sion of crop failures and the collapse o f
cate, as does experience in earlier periods,
further restrictions on bank loans and in
that large numbers o f banks, which seem urban real estate booms, precipitated num
vestments.
bers o f these failures, but the great ma
to be in a flourishing condition during
Far more promising results may surely
jority suspended because they were unable
years o f business activity, are unab’ e to
be anticipated from efforts directed to
to meet the stress exerted by the persist
withstand the stress and strain incident
ward the correction o f defects in banking
ence o f unprofitable prices for
structure and management, o f
the products o f agriculture and
which unsound banking prac
ll!ll!lllllll!lllllllllll!lll!lin illlllllllllllllllll!lllllllllllllll!lllllllllll!lll!in !llllll!lll!lllll!!l!lllllllllllllllll!l!llllllllllllll> llllllllllll!ll!lllllllllllllllllll!lllll!ll!lllllllll
animal husbandry— stress which
tices are but merely symptoms.
was particularly severe because
T he report on this and following pages, was pre
The recommendations o f the
it was experienced after years
Commission are, therefore, de
sented at the recent A. B. A . convention in Houston,
o f abounding prosperity, an ex
signed to bring about the estab
and was one of the outstanding features of the
treme appreciation in the value
lishment o f conditions which
meeting. The work of assembling the information
o f farm property, and a large
will be more favorable than in
and arriving at some definite conclusion was done
increase in the number o f farms
the past to the conduct o f bank
by the Economic Policy Commission which was
mortgaged and amount o f mort
ing along safe lines.
appointed last M ay. The Commission was assisted
gage indebtedness.
Too Many Bank Failures
Influence of Adverse
in
its
work
by
Dr.
O.
M
.
W
.
Sprague,
Banking
Pro
In the supremely important
Conditions
fessor at Harvard University.— Editor’s Note.
matter o f safety the recent rec
I
These adverse conditions, it
ord o f the American system o f
Illllllilllll!l!l[||[I!!]|||||l!lilllll![l!l]|l]Ellll!llll!!!l!l!llllllll!llll]II]ll!ll!IIIII[IIIllll!lllll[ll!lllll[lllllllllllllll[llllilllll!l]llilllll[llllllllllllllllllllll[llllllllllllllllllllll
can hardly be too strongly em
independent unit banking has
phasized, do not furnish an
been conspicuously unsatisfac
adequate explanation o f the numerous
to depression and a downward adjustment
tory. During the last six years more than
bank failures o f the last six years. By
3,800 banks, somewhat more than oneo f values in the communities in which they
no means all, or even a majority, o f the
eighth o f the total number o f banks in the
are established.
country, have been obliged to suspend
Aside from scattered failures due to dis banks in the localities most seriously a f
honesty or gross mismanagement, the fected have been obliged to suspend oper
operations, and although a considerable
ations. Unfavorable economic conditions
banking troubles o f the last six years have
number, after a variety o f adjustments
are an acid test o f the policies which
been concentrated in localities which have
and sacrifices, have been reopened, the
banks have followed during preceding
experienced a prolonged period o f adverse
aggregate o f definite failures has been in
excess o f 3,000.
conditions or the sudden collapse of a years o f business prosperity. Financially
weak and unskillfully managed banks
Many additional banks also have es highly speculative local situation. In the
are weeded out; strong and well man
northeastern states, in the territory served
caped failure only through the absorption
aged banks experience losses but they
o f losses on doubtful and worthless assets by the Federal Reserve banks o f Boston,
survive. Great significance in this con
New York, and Philadelphia, a section
by directors, assessment on shareholders
to restore impaired capital, or by subscrip which speedily recovered from the indus nection attaches to the finding o f a Spe
cial Committee on the Banking Situation
tions to additional capital from wider trial reverse o f 1920, bank failures were
relatively few, only forty during the six o f the 1927 Legislature o f Minnesota, a
circles influenced by the desire to avert
state in which adverse conditions have
years, 1921-1926. The Cleveland district
the damaging consequences o f a general
been particularly severe and the number
loss of confidence in local banking institu with thirty-six failures, and San Francisco
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
12
State and National Bank Failures
1921- 1926
T o ta l
State
Banks
F ailed
....
14
____
27
...
42
....
9
____
51
2
A la b a m a ..............................
A r iz o n a .................................
A rk a n sa s..............................
C a lifo rn ia .............................
C o lo r a d o ..............................
C o n n e c tic u t ........................
D e la w a re ..............................
D istrict o f C o lu m b ia .. . .
F lo r id a .................................. . . . .
G e o r g ia ................................. . . . .
I d a h o ..................................... . . . .
1llin o is ................................... . . . .
I n d ia n a ................................. ____
I o w a ....................................... ____
K a n s a s ..................................
K e n t u c k y ............................. ____
L o u is ia n a ............................. ____
M a i n e .................................... . . ; .
M a r y la n d ............................. ____
M a s sa ch u se tts ................... . . . .
M ic h ig a n .............................. ____
M in n e s o ta ............................ . . . .
M is siss ip p i.......................... . . . .
M is s o u r i............................... . . . .
M o n t a n a .............................. . . . .
N e b ra sk a .............................. . . . .
N e v a d a ................................. . . . .
N ew H a m p s h ire ................ . . . .
N ew J e rs e y .........................
N ew M e x i c o ....................... ____
N ew Y o r k ............................ ____
N orth C a r o lin a .................. . . . .
N o rth D a k o t a ................... ____
O h io ....................................... ____
O k la h o m a ............................ . . . .
O r e g o n .................................. . . . .
P e n n sy lv a n ia ...................... ____
R h o d e I s la n d ..................... . . . .
South C a r o lin a .................. . . . .
South D a k o t a .................... . . . .
T e n n e ss e e ............................ ____
T e x a s ..................................... . . . .
U ta h ...................................... . . .
V e r m o n t ............................... . . . .
V ir g in ia ................................ ____
W a s h in g to n ......................... . . . .
W est V ir g in ia ..................... ____
W is c o n s in ............................ . . . .
W y o m in g ............................. . . . .
T o ta l
N a tion a l
B anks
Failed
3
3
3
9
15
1
2S
155
41
45
31
236
104
26
25
2
4
16
31
1S6
22
145
130
1 12
1
1
i
9
19
3
3
27
8
39
7
68
279
8
140
18
21
1
97
212
23
137
10
1
19
32
10
30
-4 9
21
1
9
38
3
42
5
5
T o t a l s ...................... . . . . 2 , 6 8 7
1
1
1
29
1
2
59
17
1
6
!
5
11
437
3 124
8
38
2
23
3
“ A s u rv e y o f the closed b a n k situ a tio n in
M in n eso ta p resen ts an in te re s tin g p ictu re.
C e rta in com m un ities o f th e sta te seem to
h a v e escap ed e n tire ly , or alm ost e n tire ly ,
th is ep idem ic o f closed b a n ks, w h ile in
other p a rts o f th e sta te the pro p ortion of
closed b a n k s to th e num ber o f b a n k s
ch a rte re d in the com m un ity is v e r y g rea t,
nor is th is unequ al d istrib u tio n o f closed
b a n k s due in la rg e m easure to d ifferen t
con d ition s o f soil or con d ition s o f the
farm ers, fo r in p arts o f the state where the
farm in g conditions are alm ost iden tical
one p a rt show s a la rg e p e rcen ta g e o f fa ile d
b a n k s and an oth er p a rt show s alm ost none.
T he cause lies deeper th an t h a t . ”
Unqualified agreement with the view o f
the matter of this Minnesota Committee
is not inconsistent with definite recogni
tion that external conditions in many
parts o f the country during the last ten
years have been abnormally unfavorable
to the conduct o f banking along safe lines.
In the agricultural development o f the
country, however, the stage is apparently
more generally being reached in which
farm values will be more closely related
to current income, and it is not probable
that commodity prices will again exhibit
the extreme flucutations o f the last de
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
29
164
60
48
34
263
112
26
26
2
5
17
31
215
23
147
189
129
1
60
8
77
317
11
182
23
26
1
105
250
25
160
13
1
20
38
11
35
60
o f bank failures numerous. Analyzing
the causes o f bank failures, the Com
mittee says:
N orthw estern Banker
G rand
T o ta l
17
30
45
18
66
3
D ecem b er 1927
N u m b e r B an ks in O peration, 1920
------------A
--------------------------- >
T o ta l
N ation al
State
352
251
101
20
87
67
404
83
487
420
303
723
262
141
403
220
154
66
19
47
28
30
15
45
212
53
265
645
93
738
222
141
81
1 ,1 3 0
480
1 ,610
254
1 .0 5 7
803
1 ,7 6 3
1 ,4 0 5
358
249
1 , 100
1 ,3 4 9
134
450
584
38
267
229
98
63
161
190
92
282
306
159
465
112
700
588
1 ,184
3.31
1.515
354
324
30
1,532
1 ,6 6 8
136
286
145
431
1 ,0 0 8
188
1 ,196
10
23
33
70
55
125
176
212
388
76
47
123
565
491
1 ,0 5 6
536
87
623
717
181
898
775
370
1 ,1 4 5
611
356
967
187
90
277
695
851
1 ,5 4 6
31
17
48
379
82
461
558
136
694
448
98
546
1 ,026
556
1 .5 8 2
105
28
133
59
49
108
323
165
488
307
87
394
218
122
340
809
960
151
113
47
160
2 2 ,0 5 4
8 ,0 3 2
3 0 ,0 8 6
cade. It is therefore reasonable to pre
sume that no future period o f similar
duration will witness the number o f bank
failures that have marked the last six
years. I f these anticipations are realized,
the bank failure problem assumes less
unmanageable proportions, but in the ab
sence o f improvements in organization
and practice, it is not to be doubted that
a discreditable number o f failures will
continue to occur, mainly concentrated in
periods o f trade reaction.
It is also important to note that the
inability o f many banks to withstand ad
verse conditions is not a problem that
concerns exclusively those areas in which
bank failures have been numerous in
recent years.
Present immunity fu r
nishes no certain assurance that all banks
in a locality are and will remain in com
petent hands. The possibility, if not
probability, must be recognized that ad
justments even distantly approaching in
difficulty those experienced in agriculture
might be accompanied by numbers of
banking casualties in communities in
which manufacturing is the major occu
pation.
Need Greater Safety
As in earlier periods marked by nu
merous bank failures, an insistent demand
for greater safety in banking is to be
anticipated, and this demand is not
rendered less reasonable by the presence
o f strong and well managed banks in
every part o f the country. The public
must make use o f banks, but few are in
position to distinguish between the strong
and the weak.
Bank statements and
other external information relating . to
banks do not furnish an adequate basis
for intelligent discrimination.
Unless
failures become exceptional, it may be
expected that all banks will be subjected
to an increasing range o f restrictions, re
strictions that may be quite superfluous
fo r well managed banks, but which are
adopted to curb the weak and incompetent
minority.
Numerous failures should be a matter
o f grave concern to well-managed banks
fo r still other reasons. To those bankers
who are strongly opposed to branch bank
ing it should be evident that the recur
rence o f numerous failures threatens to
undermine the system of unit banking.
Recognition should also be given to the
damaging effect upon the earnings o f the
better banks during the more or less
prolonged period o f operation o f weak
banks before the failure stage is reached.
And, finally, attention may be called to
the unfavorable influence on earnings in
consequence o f the damage to a com
munity which is entailed by the unsound
conditions and unsuccessful undertakings
that are fostered by banks under compe
tent management.
While the experience o f the last six
years furnishes ample evidence of serious
defects in our present system o f unit
banking as it is now organized and oper
ated, and compels recognition o f the
urgent need fo r its modification and im
provement, the Economic Policy Commis
sion is hopeful that no revolutionary
change, such, for example, as the general
diffusion o f branch banking, will be re
quired to provide adequate protection for
the depositor, and is also hopeful that
this result can be attained with no sacri
fice but rather with a positive enhance
ment o f the characteristic advantages of
unit banking. The causes o f numerous
failures are not obscure and difficult to
discover, and the Commission believes
that the number o f failures in future can
be substantially reduced through the
adoption o f arrangements definitely de
signed to meet obvious defects that ex
perience has disclosed in our system o f
independent local unit banks.
In the judgment o f the Commission,
however, this objective cannot possibly
be reached through the imposition of
further . legislative restrictions covering
the details o f banking operations. Safety
in banking will never be secured if re
liance continues to be placed primarily
and almost exclusively upon restrictions,
13
which even when carried to an extreme
point can do no more than somewhat
narrow the field within wThich an incompe
tent management will manifest its in
competence. A more immediate enforce
ment o f existing legislation would do
much, but remedies for bank failures to
be adequately effective must be designed
to reduce the number o f financially weak
banks, secure more competent officers
supported by responsible and active di
rectors, and above all insure that un
sound policies shall be checked long be
fore solvency is endangered.
Summary of Conclusions
The co n clu sio n s o f the C om m ission m a y be su m m arized as fo llo w s :
1.
A fe w ban k s fa il on a cco u n t o f d ish on esty or gross m ism anagem ent.
2.
A d v e r se co n d itio n s p re cip ita te n um erou s fa ilu re s o f ban k s th at are
fin a n cia lly w ea k and u n s k illfu lly m an aged.
3.
A n excessiv e n u m ber o f banks is the m ost p oten t sin gle cause of
n um erou s fa ilu res. T his situ ation can be c o r r e c te d in p a rt b y in
crea sed ca p ita l req u irem en ts, and m ore co m p le te ly b y the lim itation
o f n ew ch a rters to the n eeds o f the co m m u n ity fo r a d d ition a l banks.
4.
In v ie w o f the h ea v y resp on sib ilities, both leg a l and m oral, o f bank
d ire cto rs, clo se r su p erv ision b y them is desirable in th eir ow n in
terest, an d w o u ld serve to co r r e c t m u ch th at lead s to in solv en cy.
It is recom m en d ed that the A sso cia tio n p rep a re stan d ard form s
fo r the an alysis o f the co n d itio n o f b an k s and fo r the p resen tation
o f business to be b ro u g h t to the a tten tion o f b a n k d irectors.
5.
W h ile a d d itio n a l re strictiv e le g isla tio n c o v e r in g loan s an d in v est
m ents is not fa v o r e d , the m ore im m ed iate e n forcem en t o f ex istin g
statutes is a p p ro v e d .
6.
The cle a rin g house ex a m in a tion system has been in gen eral h ig h ly
a d v a n ta g eou s, and its fu r th e r g ro w th is to be a n ticip ated .
7.
A s a plan , m ore fe a sib le fo r im m ediate and g en era l ad op tion , the
org a n iza tio n o f lo ca l re g io n a l a ssocia tion s o f b an k s fo r the p u rp ose
o f su p p o rtin g and se cu rin g the m ore e ffe ctiv e use o f the existin g
system o f g ov e rn m e n t ex a m in a tion s is str o n g ly recom m en d ed .
Excessive Numbers of Banks
A system o f unit banks is peculiarly
subject to the grave danger that a much
larger number o f banks will be estab
lished than is compatible with the re
quirements essential fo r safety o f finan
cial strength and good management.
Under a highly developed branch banking
system the large capital and, even more
important, the extensive organization
needed -from the outset, effectively re
strict the formation o f new banks.
Branches may, indeed, be overdeveloped,
but experience indicates that the conse
quent inroad on earnings is not serious
enough to impair capital, much less
jeopardize the position o f depositors.
Strikingly different is the situation
under a system of unit banking. In order
that all communities may enjoy the bene
fits o f banking facilities under competi
tive conditions, the minimum capital re
quired for the establishment o f a bank
is necessarily set at a low figure, and
operations can be handled by a simple
organization that can be readily im pro
vised. Profits during years o f business
prosperity are reasonably satisfactory,
and the temptation to enter the banking
business is made more alluring by the
exaggeration o f these profits under the
faulty accounting practice that is followed
by most banks. Reserves are not created
to take care o f future losses, but all un
distributed earnings are allocated to sur
plus and undivided profits, from which
deductions are subsequently made, often
most unwillingly, when lossess have been
unquestionably realized. In addition to
anticipations o f profits, a certain meas
ure o f power and dignity, especially out
side the large cities, that seems to attach
to the management o f banks, does much to
enlist an active interest in proposals for
additions to their number, and the pos
sibility of securing liberal accommodation
through relationship with a bank, as offi
cer, director, or shareholder, is a consider
ation that is by no means uncommon.
Public opinion also has in general looked
with positive favor upon an unlimited
increase in the number o f banks. That
men o f good character and average busi
ness experience should be as free to en
gage in banking as in other occupations
seems to have been taken for granted.
Insufficient account is taken of the special
characteristic o f banking that it exposes to
risk of loss not only shareholders and busi
ness creditors but also the wide circle of
depositors who are not in position to pro
tect themselves by the exercise o f reason
able care and foresight. Moreover, the
misconception is widespread that addi
tional banks in a community will increase
the available supply o f credit, a motive
particularly strong in communities where
the local supply of credit regularly falls
short o f the local demand for accommo
dation.
It is not clearly perceived that the vol
ume o f credit in any community is de
termined by the wealth and banking habits
o f its people, and that an increase in the
number o f banks subdivides but does not
appreciably augment t h e
aggregate
amount o f banking resources. A com
munity with aggregate banking resources
of, say, $4,000,000 will be better served
in every way including safety, by two or
three banks rather than by six or more.
An excessive number o f banks induces cut
throat competition, and tends to under
mine conservative standards in the grant
ing o f credit, which in turn subjects the
better borrowers to the necessity o f pay
ing higher rates fo r loans since they are
obliged to compete with a demand for
credit that properly should not receive
favorable consideration.
Country Over-banked
During the decade and a half preceding
the trade reaction o f 1920, these various
influences brought about the organization
of a large number o f new banks in most
parts o f the country, and in the judgment
o f your Commission the resulting over
development o f banking is more respon
sible than any other factor for the bank
ing disasters o f the subsequent years. Be
tween 1904 and 1920 the number o f state
banks and trust companies increased from
7508 to 22,054 and the number o f national
banks from 5331 to 8123. Aggregate re
sources had indeed increased enormously
so that the average resources at the close
o f the period were greater than at its
beginning. But an average of resources
is most misleading, since the gain in re
sources was by no means evenly distributed
among the banks. Many banks had become
larger and stronger, and the thousands o f
newly chartered banks served mainly to
provide the country with an unprecedented
number o f small banks employing re
sources o f from $100,000 or even less to
$500,000.
The strength o f any particular bank can
not, o f course, be determined by its size.
There are hundreds o f small banks
throughout the country that are ably man
aged and abundantly strong. These banks
are commonly subject to the handicap of
an absence o f industrial diversity in the
communities which they serve— a handicap
which they can only overcome by the ex
ceptional caution and judgment. On the
other hand, while there is no exact rela
tionship between the number and size o f
the entire group o f banks in a locality
and the strength o f its banking position,.
(Continued on page 36)
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
14
COLLEGE education comes h ig h /’
says one observer (both wise and
witty), adding:
“ Nowadays it
takes around $5,000 to educate a good
quarterback!
A
Someone else, with the country’s welfare
at heart, has figured that the 1927 football
season drew an attendance o f 30,000,000
people, at an average price o f two dollars
each fo r about $60,000,000 in pleasure and
recreation.
Golf statisticians, too, have figured that
America’s golf bill would pay the war
debts o f a group o f European countries.
Many individuals, including bankers, are
stopping to ask: “ Is it sensible ? Is it
right? Are we playing too much golf,
football, and all the other sports? Would
business and industry be better off: if
Jack risked the chance o f being a dull
boy by more work and less play?”
In an interview during the Houston
convention of the American Bankers A s
sociation, one o f the nation’s leading bank
ers, A. P. Giannini, founder o f the Bank
o f Italy, made the frank statement that
we are playing too d— — much golf for
the good o f the nation. His ideas are pre
sented below in full.
The N o r t h w e s t e r n B a n k e r has asked
a half dozen bankers o f the middle west
to give their ideas on Mr. Giannini’s ar
ticle. Their comment follow s:
Says David R. Forgan, vice chairman
o f the National Bank o f the Republic,
Chicago:
“ I do not at all agree with Mr. Gian
nini regarding golf, although I agree with
the rest o f his article. O f course, any
thing, including golf, may be overdone by
some individuals but, on the whole, I be
lieve that golf is a great boon to the
American business man. I think the Amer
ican business man who ‘eats and sleeps’
with his business, who gives his entire
life to it, and arrives at old age with his
mind full of nothing but how to make
more dollars, is greatly to be pitied. It
appears to me the greatest temptation to
American business men is to be nothing
but business men, and golf, in moderation,
and for the purpose o f healthful recrea
tion, is to my mind just what American
business men need.”
Recreation Is Essential
Lucius Teter, president o f the Chicago
Trust Company, says:
“ I have read with interest what Mr.
Giannini has to say. I think there is
something to think about in his statement.
O f course, we have been going through a
very strenuous and unsettled time during
the last ten years, and I do not think the
average person fully realizes to what ex
tent the world excitement has affected the
programs o f a large percentage o f our
people. Certainly it is a good plan to
have as much outdoor recreation as possi
ble. Personally I prefer horseback rid
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
G iv in g his f a m ily th e cold shoulder
Are W e Playing
Bankers of middle west express
craze for sports is a
ing. I f it is at all proper for an ‘out
sider’ to criticize golf I would say that
sometimes it appears to me that some o f
my friends make quite as hard a job o f
golf playing as they do o f their business.
This, o f course, is not right at all. It
would be much better to attend to busi
ness and play less golf and enjoy that
which is play.
However, somehow I
think it will all work out all right.”
Charles H. McNider, veteran Iowa
banker, agrees rather fully with Mr. Gian
nini. He says:
“ ‘Is there too much golf in America ?’
“ Primarily, yes. Bankers and business
men devote too much time to golf to the
detriment o f their business. We have ex
amples o f young professional men in the
city whose offices are closed at one or two
in the afternoon and they are out on the
California Banker Says:
By AMADEO PETEE GIANNINI
(N o te :— The fo llo w in g article in part, ap
peared in a Houston, Texas, newspaper, during
the A m erican Bankers A ssociation in that city.)
A R D work is the best farm relief.
H
And as I see it, it is the only re
lief the rural population of America
can expect. Congress may pass laws
hard pressed by the policy they pur
sued, found it necessary to go to work.
When they went to work, they were
applying the very best antidote for
failure.
I wouldn’t want it understood that
to hand the farmers money if they
I thought the government should do
fail to make good, but it will be dis
nothing to help— it can very well as
sist by distributing information and
tress, not relief.
A ll over the country the farm situ
ation is getting better by the natural
process of adjustment, for the farmers
who work. For those who are willing
to “ let George do it” the situation will
never improve.
The reason there is general im
provement
is because the farmers,
fostering better marketing and being
helpful to the farmers without giving
them anything.
To give to them would discourage
hard work, as they would take the
attitude if they got in bad straits
again, the government would come to
their rescue.
There is no better example of this
15
for a hot time on the links.
T o o Much Golf?
opinions as to whether America’s
blessing or a curse
golf field, spending time that should be
spent in earning a livelihood. It seems to
me that the country is going golf mad.
There is no great organization but what
two-thirds o f its time is taken up in golf
tournaments instead o f in helpful ses
sions.
“ While I appreciate that it is quite a
wonderful game fo r a good many people,
at the same time it is overworked, and
No One Is Perfect
very much to the detriment o f legitimate
business.”
“ Moderation” in athletics, just as in
any other work, is desirable, says T. R.
Watts, Iowa banker, who adds:
“ Mr. Giannini’s success in his chosen
line o f business would indicate that he
is a man o f mature judgment, and a stu
dent o f affairs, and seems to have ex
pressed in his article that which is be-
“ T O O MUCH G O L F ! ”
Founder Banlc of Italy, San Francisco
than the English doles started to save
those out of work after the war. Now
there are 500,000 who idle not because
there is no work to do but because
they don’t want to work.
I
do
not
think the
government
and have nothing on which to operate
when times are not so good. Both
conservation and diversification will
help them.
Another thing, I think there is too
damn much golf in the country. I
should get into the farming business
nor do I believe that it is the province
have never understood how a man can
of the government to guarantee cer
course and be more interested in it
tain prices.
But I do think the gov
than he is in his business and succeed.
ernment can well lend its good offices
This afflicts the business man more
than it does the farmer, but the farmer
to keep the market from becoming
glutted, to
marketing.
inject
intelligence
into
There are too many autos to take
the farmers away from their work.
A little prosperity distracts them.
They spend their money in good times
spend half of his time on
lieved to be, by a great many successful
men, sound logic.
“ It is a pretty well accepted fact among
thinking people that there is too much
time wasted by a very large percentage
o f the American people in various amuse
ments, in fact, in entei’taining themselves,,
whether it be in g olf or in other ways,,
and while the writer has not had sufficient
experience with the game o f golf to jus
tify the taking o f other folks’ time in
the discussion o f it, I have observed that
a great many active business men do not
have the physical strength to grind con
tinuously at their business, regardless o f
how much they would like to do so, and
the g olf course has, in a great many in
stances, served a very useful purpose in
affording them an opportunity for recrea
tion and I’ecuperation, and probably is en
titled to its place in the general program
o f affairs.
“ The article referred to gives expres
sion to that which is believed to be true
by a great many folks when it talks about
farmers not working, and am wondering
whether the conclusion is based on the
exception rather than the rule.
a golf
has plenty to distract him from his
“ It probably could be said that there
is no line o f endeavor, whether it be bank
ing, farming or what not, where every in
dividual attempting it is one hundred per
cent efficient.
“ I have observed in my rather close con
tact with folks in the agricultural belt for
the last quarter o f a century that there
are farmers who possibly do not devote
as much o f their time in planning their
affairs and their strength in prosecuting
them as they should, but am convinced that
the program o f the average farmer is that
o f hard work and fairly careful planning.
“ There no doubt is too much extrava
gance practiced upon the part of every
body with the automobile, but I can think
o f no other line o f endeavor in which the
automobile plays a more important part
than in farming, and can think o f no
class o f people who, from the standpoint
o f their needs, would be more justified in
using a car than the man residing on a
farm in a rural community.
“ Poor management, economic waste and
lack o f industry have no doubt been con
tributing factors to the agricultural de
pression throughout the country, but I be
lieve that the fluctuation o f from twenty
to forty per cent in a few months in the
price o f agricultural products, as has hap
pened during this summer, is very largely
responsible for the unstable agricultural
conditions.
farm is to be a success, he must be
“ The rank and file o f fanners do work,
and work hard, and plan fairly well ex
cept that they do not work together, but
methods are being improved and the
standard o f planning improved from year
on the job himself and buckle down.
(Continued on page 32)
business. He gets it in his head he
wants to boss and hire his work done.
He doesn’t seem to know that if his
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
16
which own the bank.
ORE and more
The Maytag name is
are b a n k e r s
k n o w n in financial
a p p recia tin g
circles from coast to
the importance o f a
coast.
complete credit file.
The methods em
W h e r e the b a n k e r
ployed by the bank
once carried in his
are primarily Maytag
head the credit in for
m e th o d s, the sam e
mation on his various
keen , b u s in e s s -lik e
customers, he now as
m e t h o d s that h a v e
sembles his data on
been used to develop
neat cards, ready for
the immense Mayt'ag
use at a minute’s no
manufacturing inter
tice. Experience has
ests. In fact, had Mr.
taught him that these
Maytag chosen bank
cards are the watch
ing instead o f manu
dogs o f h is b a n k ’s
facturing as his voca
funds.
tion, he would doubt
The credit depart
less have risen to
ment o f a bank is
s
im ila r commanding
highly important, say
heights in the banking
officials o f the “ oldest
world.
bank in Jasper coun
T he su b s ta n tia l home of the J a s p e r C ou n ty S a v in g s B a n k at N e w to n
Vice President Bes
ty, Iowa” ; the Jasper
tor has this to say
County Savings Bank.
about the bank and
Hence, the bank has
general conditions:
worked out an exten
“ Farm sales here
sive credit inform a
are picking up some.
tion system that has
Clear real estate is a
proved its worth.
good thing when ac
Vice president P. H.
quired at right prices.
Bestor has this to say
A t the present time
about it : “ In addition
we are receiving more
to our regular credit
in
q u ir ie s on fa r m
file, we have a sepa
H ow the Jasper County Savings Bank assembles
lands from responsi
rate set o f c r e d it
and files its credit information
ble operators than for
cards that assist us
years. Some o f our
greatly. The card is
r e n t e r s have m ad e
five by eight inches
good money the past two or three years,
and contains on the one side the custom
have saved one or two thousand dollars
er’s name, address, occupation, and
and now want to pick up Iowa farms.
space for entry o f his income, mercan
Most o f them want 160 acres or more,
tile rating, credit limit, history, family,
having found that with proper diversifi
age, church, lodge, extent o f savings
cation, the larger farms, properly
account, ability, character, average bal
stocked, pay better than the smaller
ance, etc. On the other side is space to
ones.
list his assets and liabilities, checks re
“ So far as Newton is concerned, our
turned, etc.
factory prosperity has made our farm
“ One of our stenographers takes care
land comparatively high. Investors can
o f posting the card entries, consisting
often get just as good land at lower
of daily reports from the county record.
prices farther away. These days there
This includes judgments, chattel mort
is a more pronounced distinction be
gages, protested checks, overdrafts, and
tween the good and bad farms than
every bit of information that is ob
during the boom times, and land sales
tainable. It is not at all complicated,
reflect
that difference.”
and requires only an hour’s time daily
The Jasper County Savings now has
to make the entries. It gives us a
deposits o f $2,671,594 and is carrying in
splendid record o f our borrowers and
cash and secondary reserve, $1,267,514.
has saved us money many times.”
It has around $390,000 in bonds and
In Mr. Bestor’s opinion, no banker
more than $300,000 in commercial pa
should overlook his credit department.
per. “ All bonds and paper,” says Mr.
The same duplicate credit file system is
Bestor, “ are short term stuff.”
being installed in the Kellogg Savings
The bank officials report their loans
Bank at Kellogg, which is owned by the
in good shape, the excellent growth o f
same interests as the Jasper County
Newton making many loans good that
Savings.
were once considered doubtful. All new
A study o f the business methods of
loans amounting to more than $500
the Jasper County Savings is not com
made by this bank are passed upon by
E
.
H
.
M
A
Y
T
A
G
plete without referring to its President,
(Continued on page 88)
Presiden t o f the Jasper County S av in g s B an k
E. H. Maytag, and the Maytag interests,
M
CREDIT FILE
THAT PAYS
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
17
Ishpodar Broadcasts
some
U
D O ’S and D O N ’T’S
By
ROSCOEMACY
(A continuation of the bank
ing rules laid down by the
spirit of Ishpodar, keeper of
the royal counting house of
the King of Sheckem.)
1. And Ishpodar opened his mouth and
spake again, saying,
2. Scorn not the widow’s mite, but send
her unto the Savings Department; suffer
her not to open a checking account with
it.
3. Close thou thy bank to the checkcasher at the appointed hour, but if the
note-payer cometh and knocketh in the
eventide, even at the eleventh hour, let
thy door be opened unto him.
4. Be thou on thy toes if thy customer
buyeth corn for future delivery upon the
board o f trade, and if he selleth it like
wise, fo r he only layeth, up misery for his
creditors,
5. Take thou therefore a
upon the beasts o f his field and
o f his chicken-yard, and upon
and 1928 crop, and upon his
subject only to prior liens.
mortgage
the fowls
the 1927
vineyard,
Don’t Forget the Chickens
6. And in the covenant o f mortgage,
cover thou his ox and his ass, his bullock
and his ram and his she-goat; yea, even
his cock and his hen include thou them.
F or thou knowest that if thou includest
part and omittest part, verily it shall
come to pass that what thou includest
shall die and wither away, but what thou
omittest, it shall wax fat and be nourished
abundantly.
7. Look not upon the Profits account
when it is red ; when it giveth its color to
the rumor o f insolvency, fo r the day of
reckoning draweth nigh.
8. Go thou to the tabernacle on the Sab
bath day, for thy director passeth the col
lection plate. Therefore, place thy shekel
in the plate at the appointed time, and on
the morrow he will bring to thy bank fifty
shekels in nickels and pennies fo r thee to
wrap.
S ay s Ish p o d a r: ‘ ‘ Close thou th y bank to the cheek-casher at the appointed
hour, but i f the note p ayer cometh and knocketh in the eventide, even at the
eleventh hour, le t th y door be opened to h im ! ’ ’
9. Blaspheme not thy competitor, but
take him unto thy bosom, fo r perchance
lie would like to work with thee instead of
against thee. And the time will come
when thou wilt have need o f his services,
even as he o f thine.
10. It were meet that thou shouldst en
tertain thy directors in thy home on occa
sion, but set not before them the choicest
viands and the sparkling wines. Let them
eat rather o f unleavened bread and pulse,
and bitter herbs, that they may approve
thine economy. Give thy bond-servants
also the evening off, that thy wife may be
gracious, yet fatigued withal.
Means Salary Boost
11. Then, when the new year cometh,
they are like to give ear to thy plea for a
boost in salary.
12. Be ever diligent, and mindful of
thy duty to thine employers; be thou es
pecially diligent in November and De
cember, fo r the sake o f thy Christmas
bonus.
13. Hearken not to the cavillings o f
him who kicketh on the service charge;
let him Aveep, and wail, and gnash his
teeth, but stick thou him for his fifty cents
notwithstanding.
14. Nor yet hearken to thy new cus
tomer who vaunteth the virtues o f the
cashier o f the bank he has just left, and
telleth thee that he could always get all
the money he wanted there, and then striketh thee for an unsecured loan, yet objeeteth to giving thee a financial state
ment,
15. For verily, I say unto thee, that ere
the snow flieth, the virtuous cashier of
whom he speaketh will run an attachment
upon the crops o f his former customer for
ten talents o f gold, and if thou hast made
the loan, thou wilt be in the soup.
16. W oe unto him who overdraweth
his account, and then casheth his next pay
check at the cigar store.
17. And woe unto him who borroweth
an hundred shekels to buy a cow, and
maketh a payment on the car therewith.
18. But blessed, thrice blessed, is he who
rideth in an 1895 buggy behind a span o f
dun mules until he hath paid his debt to
thee, even unto the uttermost farthing.
19. F or he shall prosper in the days to
come, and his daughter shall wear purple
and fine linen, and his son shall play full
back at the agricultural college.
20. Renew the pen points on thy cus
tomers’ desk in due season, lest they rust
and cleave to the holders, so that thou
(Continued on page 90)
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
18
En Route to the Houston Convention
T op row , le ft , a ch arm in g c ig a r e tte ven dor, in R udolph H e c h t ’s T ea G arden, a t his sum m er home a t P a ss C h ristia n , M iss is
sippi, w h ere fo u r hundred b a n k ers on th e F a llto n ie S p e c ia l w ere e n terta in e d en rou te to the H ouston con ven tion . C en ter, C ra ig
B . H azlew oo d , C h ica go , th e n ew first v ic e p re sid e n t o f th e A . B . A . M rs. Iia zle w o o d on the le ft , and M rs. M e lv in A . T ra y lo r,
rig h t. R ig h t, top, R aym on d M c N a lly , v ic e p re sid e n t o f the N a tio n a l B a n k o f th e R ep u b lic, C h ica go, and John G. L o n sd ale,
p resid en t, N a tio n a l B a n k o f Com m erce, S t. L o u is, and second v ic e p resid en t o f the A . B . A .
C en ter p a n el: L e f t , J. W . M iln er, m a y o r G u lfp o rt, M ississip p i, and E d w in G. F orem an , Jr., v ic e p re sid e n t F orem an N a tio n a l B a n k
and F orem an T ru s t and S a v in g s B a n k , C h ica go. M id d le group, M rs. C liffo rd D e P u y , D es M oin es, M rs, E m il W eb b ies, B u r lin g
ton, and M rs. M . E . T a te , K e o k u k . R ig h t, M r. and M rs. R udolph H ech t, o f N e w O rleans.
L o w e r p a n el: M r and M rs. F re d A . C uscaden , v ic e p resid en t, N o rth e rn T ru s t Co. o f C h icago. R ig h t, Thom as R. P resto n ,
o f C h a tta n o o g a , n ew A . B . A . p re sid e n t, M rs. P resto n and F . N . S hepherd, e x e c u tiv e s e c re ta ry o f th e A . B . A .
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
19
D o O u r Special S avings
Clubs Pay?
Bankers of middle west differ in opinion of value of such
clubs either directly or indirectly
OES the special savings club pay?
I f it does pay is it directly profit
able to the bank or do its bene
ficial results come indirectly?
These questions are always important
to the banker and are o f particular inter
est at this time o f the year when the
books are being closed on the 1927 Christ
mas Savings Clubs and plans are made
for those o f next year.
D
Opinion Differs
well sold on the Christmas Savings Club
idea, E. E. Simmons, cashier, making the
following comment :
“ W e do not, as a general proposition,
have anything special to stimulate sav
ings here except our Christmas Savings
Club, which has proven very successful
with us. W e give considerable publicity
to the Club, and it is well patronized by
our own customers, as well as customers
o f other banks. W e have stressed the
proposition that this method o f saving
provides funds fo r Christmas gifts, and
we have also suggested in our advertising
that a portion o f the account be trans
ferred to a regular savings account, which
is quite generally done. Our Club is
an expression o f judgment and not one o f
experience.
“ A certain amount o f money accumu
lated in the Christmas Savings Club is
transferred to regular savings accounts
and, in a few instances, club members
have purchased securities, but the number
is so small as to be negligible. The only
advantage that a special savings club has
over regular savings is that o f incentive.
“ Our experience indicates that various
schemes fo r inducing people to save are
rarely worth their c o st; that people who
want to save money will do so and that
about the most a bank can do is to con
sistently and continuously present the
general proposition o f thrift, together
with such advantages as the
particular bank offers.”
There is considerable diversity o f opin
ion among banker readers o f this maga
zine on the above questions. “ The Thrift
Appeal,” so far as the Christmas savings
idea is concerned, is the real
hub o f the matter, according
lli:il!llllllllllllllllill!llllllllll!lllllllllllll!lll!lllllllllllllll!l]||||||llll!ll!ll!lllllllllll!lllllll!lllllll!llllllll!ll!l!llllllll> llll!ll!llllllllllllllll!lllllll!!lllllllllllllin ;il!llll
to John C. Bryant, cashier o f
the Red Oak Trust and Savings
Bank, Red Oak, Iowa, who says
this o f their Christmas Sav
“ The special club plan is an adjunct of the regular
ings C lub:
savings account and its principal value is in the
“ We have used for two years
advertising of something different.”— An Iowa
now a Christmas Savings Club.
Banker.
While the total amount o f the
“ In view of the fact that it stimulates regular sav
deposit is not large the plan
ing, there is no question but that it is profitable in
affords some educational value
the long run.”— A North Dakota banker.
in getting the matter o f sav
ings before the people and
“ Our experience indicates that various schemes
saving fo r Christmas time
for inducing people to save are rarely worth their
seems to appeal strongly to
cost.”— A n Illinois banker.
quite a large number of
School Savings Means W ork
Another bank, this one in
South Dakota, speaks o f its
school savings club, saying,
“ W e have such a club and it
keeps three clerks, one in each
bank in town, pretty busy dur
ing the school season. W e do
not think it is profitable, but
on the contrary, a very ex
pensive way to build up de
posits.”
The First National Bank o f
Omaha, is inclined to look with
people.
“ W e do not favor the special savings club idea.”
disfavor on special savings
“ W e should say that the
— A Nebraska banker.
clubs. Officers o f that bank feel
value is educational rather
that they are not profitable, al
than financial.
']!lll[l!l!lll!llil|[||llllll!lll|jN]||[[l!llllllll!llll]|jllJilJS]|j|IIIIII]||jlJ!ll]ll[||||]||]|lill!li]||||l!ll[|||l!llilllljlll!l!!llll!ll!lllll!IHI!ll!llllliilll!!ll!IIIIIIjniin[||l!llll!ll!l
though the institution accepts
“ W e use circulars in the
Christmas savings deposits,,
mail, posters and newspaper
growing in membership every year, and
space for advertising our campaign,
but does not attempt active solicitation
wThile it is not directly profitable in it
which starts the first part o f De
o f such accounts.
self, the result is that it stimulates and
cember.
Says They Do Pay
furnishes a feeder fo r our Savings De
“ As by-products o f this system we
Robert J. Izant, manager o f the busi
partment, and in view o f the further fact
get a few deposits in regular savings
that it stimulates a habit o f regular
ness extension department o f the Central
accounts o f the amounts saved by the
savings, we think there is no question
club plan.
National Bank, o f Cleveland, writing in
but that it is profitable in the long run.”
a recent issue o f the Savings Bank
“ W e should say that the special club
plan is an adjunct o f the regular savings
Journal, is firmly convinced that special
Differs
in
Incentive
account and its principal value is in the
savings clubs pay. He says :
One o f the larger banks o f the middle
advertising o f something different. The
“ Special purpose savings clubs do pay..
literature, too, is attractive, being il Avest brings ou t this id ea :
The experimental stage long since has
luminated.
“ The Christmas Savings Club is the passed. Time was, and not so long ago,
“ W e think enough o f the plan to con only one we have ever attempted to oper when we considered the thrift club as a
tinue it.”
ate and that only after there was a con part o f the advertising program. It was.
designed to bring folk into the bank. In.
siderable demand fo r it.
Specifically
Promotes Regular Saving
this respect it was parallel to a depart
there is no profit in the Club, nor do we
The Merchants National Bank, of
believe there is a profit in travel or vaca ment store’s display window. It helped'
(Continued on page 79)
tion clubs, though the latter is merely
Fargo, North Dakota, is likewise pretty
What They Say:
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er Î927!
20
J. M. Dinwiddie, president o f the
Cedar Rapids Savings Bank and Trust
Company, sends us the following inter
esting paragraph : “ A leading daily pa
per in Houston during the bankers’ con
vention there had the following signifi
cant two-line heading in big type : ‘Bank
ers Got Down to Business. Two People
Shot Last Night.’
“ The hotels, not to be outdone, and be
lieving the public needed some warning
to look out for the bankers, sent out a
card containing the follow ing: ‘ The
traveling public is warned to avoid Hous
ton, Oct. 23, 24 and 25, on account of
bankers’ convention— there will be many
bankers here.’ ”
C. Howard W olfe, cashier o f the Philadelphia-Girard National Bank, has been
elected president o f the clearing house
section o f the American Bankers’ Asso
ciation. Mr. W olfe’s activities in this
section o f the Association are well known
to bankers throughout the United States,
and his election was in recognition o f the
fine work he has done.
Mr. W olfe Avas a member o f the pre
liminary organization committee o f the
Federal Reserve Board, in \AThich connec
tion he prepared and organized the gold
settlement fund at Washington and made
the first two clearings in that city.
Rudolph Hecht, president o f the H i
bernia Bank and Trust Company, NeAV
Orleans, greatly increased his popularity
on the Falltonic trip because o f the de
lightful entertainment furnished in the
beautiful Japanese tea garden o f his sum
mer home at Pass Christian. Mr. and
Mrs. Hecht were unanimously voted the
perfect host and hostess.
Evans Woollen, president o f the
Fletcher Savings and Trust Company of
Indianapolis, gave the report o f the eco
nomic policy commission at the Houston
convention, which had to do with a plan
for reducing bank failures.
“ The bank failure situation can be cor
rected in part,” said Mr. Wollen, “ by in
creased capital requirement and more
completely by the limitation o f new char
ters to the needs o f the community fo r
additional banks.
“ In the supremely important matter of
safety, the recent record o f the American
system o f independent unit banking, has
been conspicuously satisfactory.”
Independent initiative and independent
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
thought in e\rery line o f endeavor in the
United States, have helped to make this
nation what it is today, and this certainly
applies to the banking business.
The
bankers o f America have been forwardlooking and forward-thinking, and it is
due to them in no small degree that
American business has made the rapid
strides it has during the last half cen
tury.
A. P. Gianinni, chairman o f the advis
ory committee o f the Bank o f Italy o f
San Francisco, in an interview with
newspaper men at Houston, said that
bankers “ play too much golf.” He does
not see how bankers can spend half their
time on the g olf links and still make a
success o f their institutions.
Both sides o f this question are thor
oughly discussed in this issue o f the
N o r th w ester n B a n k e r .
Personally, I think that there is a hap
py medium which bankers should follow
in their golfing activities, which will help
to give them a sufficient amount o f exer
cise which in turn will help to keep them
in better physical trim and thus make
them better and more successful bank
ers.
Craig B. Hazlewood, vice president of
the Union Trust Company o f Chicago,
tells us this o n e : Tourist— Can you cash
this check fo r me? Village Banker— I
haven’t that much but I ’ll take you over
to the filling station and introduce you.
Camparing reports o f such organiza
tions as the American Bankers Associa
tion, the National Association o f Credit
Men, and others, it is estimated that dur
ing last year Americans were swindled
out o f one and a half million dollars,
which represents an increase of fifty per
cent over the losses o f the previous year.
The associations named above, with the
help o f the New York Stock Exchange
and several other powerful bodies, are
making an exhaustive investigation o f
the conditions leading to such an enor
mous annual loss.
The various forms o f fraud entering
the grand total are in reality “ get rich
quick” schemes.
It is to be hoped that eventually before
investment in securities is made, inves
tors will get the advice o f reputable
bankers or experienced business men and
thus reduce this “ million dollar swin
dle.”
Two fashion notes that have recently
come to our attention are as fo llo w s:
“ Women who wear Realsilk hosiery ha
bitually,” confides the manufacturer,
have that mysterious poise which comes,
o f course, from knowing that they will
pass without hesitation the most critical
inspection.” Someone has asked, “ But
why spoil the m ystery?”
“ Van Heusen may make better collars,
but you can’t beat A rrow for the beauty
o f the boys Avho wear theirs in the ad
vertisements.”
Basil I. Peterson, vice president o f the
Stock Yards National Bank o f Chicago,
aaT io is quite a poet himself, has reprinted
“ The Master Stockman,” by Alvin H.
Sanders, and sent it out to his banker
friends. The poem is as follow s:
“ W ith glad acclaim and b earin g garlan d s
b rig h t and w reaths o f b a y
W e sing the glories of the fecun d fields where
herdsmen-shepherds, hold th eir gen tle
sw ay!
In pastures green, b y run nin g brooks; in
bosky dells, in g rassy nooks,
The d istan t m ellow ja n g lin g o f sweet bells
proclaim the peacefu l paths
O f low ing herds and fleecy flocks, the g if ts
supreme o f husbandry!
B lessed be the lands on which th ey g ra ze !
and blessed those who gu ide them on
th eir w ays.
W ield ers o f power th at verges on the Infin ite
its e lf!
D ream ers o f dream s who liv e to see their
dream s come tr u e !
W orkers o f m iracles in a w orld t h a t ’s all
their own!
K eep ers of keys to l i f e ’s most hidden m ys
teries !
L e t kin gs and lords o f lesser human realm s
m ake A v a y ,
W h ile a ll the n atio n s fro m th e depths o f
g r a te fu l hearts
U n ite to crown the m aster stockm an m aster
o f the a rt o f a rts!
The American Association o f Land
Grant Colleges and Universities, has
spent six months in an endeavor to work
out some definite conclusions regarding
emergency relief for the agricultural
communities. They have come to the
conclusion that no single relief act is
equal to solving the problem.
Two o f the main suggestions which this
committee o f economists and educators
have made, a re :
1. No further development o f land for
agricultural use and development o f a
far-sighted land policy.
2. Control o f surplusses through ad
justments in acreage and numbers o f
livestock. W ithhold new lands from cul
tivation. Greater use o f storage facili
ties. Sound marketing organizations and
unified action in handling such parts of
commodities as may prove burdensome
as well as through favorable and sound
types o f legislation.
(Continued on page 89)
21
“NO M o re Guessing
ON CREDIT”
— Say Nebraska Bankers
PPROVED by the Comptroller of
Currency in Washington and by
the Nebraska Banking Depart
ment, sanctioned by the American Bank
ers’ Association, and recieving the hearty
endorsement o f leading banking officials
throughout the country, the First Nabraska Bankers’ Credit Clearing House
Association has started its existence with
the backing o f practically the entire
banking fraternity. Most o f the details
necessary to its operation have all been
worked out, and the Association is now
functioning smoothly toward the bene
ficial results which its members know
they will obtain.
A
Is “ Father” o f Plan
Dan V. Stephens, president o f the Fre
mont State Bank at Fremont, Nebraska,
might well be called father o f this Credit
Clearing House plan, fo r it has been
largely through his untiring efforts that
its organization has been attained. Mr.
Stephens is a member o f the State Bank
ing division o f the American Bankers’
Association, and it was through this con
nection that he first got his idea. A year
ago the A. B. A. appointed a committee to
investigate and make a study o f the du
plicate borrowers situation as it existed,
and to suggest any plans fo r improve
ment at which it might arrive. The plan
which Mr. Stephens was instrumental in
inaugurating in Nebraska is the one o f
fered by the A. B. A. Committee as the
best remedy to offset the disastrous e f
fects o f duplicate borrowing and also to
improve banking conditions generally.
Mr. Stephens has recently met with the
heads o f banking departments o f four
different states, and their reaction wTas
decidedly in favor o f the plan, so much
so that they are now taking steps toward
its adoption under their own jurisdiction.
The First Nebraska Bankers’ Credit
Clearing House Association membership
is composed o f the banks o f Dodge, Saun
ders, Washington, Douglas, and Sarpy
-counties, Nebraska. There are seventytwo banks in these five counties, the
territory having been assigned by the
Nebraska Commission o f Trade and Com
merce. As seventy-two banks make an
average allotment fo r one examiner to
handle, the territory included is practi
cally perfect from an efficiency stand
point. Fremont, in Dodge county, is
centrally located in these five counties,
and the headquarters fo r the association
will be located in this city.
Mr. Stephens, in speaking o f the ob
jects to be attained, says:
“ The object o f such an association is
primarily and briefly to protect the banks
and the public from loss by promoting
efficient banking.
“ Clearing Houses ordinarily are fo r the
clearance o f checks and the transaction
o f ordinary business among the banks o f
a certain community. This is an ordi
nary function readily agreed upon by all
banks and it is separate and distinct from
the idea o f a Credit Clearing House with
an examiner as proposed in this plan.”
There will o f course be a great deal of
detail work in the operation o f an Asso
ciation o f this kind. As stated before, a
central office will be maintained in Fre
mont, with a competent man in charge.
Each member bank has already sent
into the headquarters office a complete
list o f all borrowers from his institution,
together with the amounts o f each loan.
This information, from
seventy-two
banks, is properly indexed and filed. As
can be imagined, there will at the start be
D A N V. S T E P H E N S
a number o f duplicate borrowers, and it
is quite likely some o f the banks will get
some eye-opening information.
The first thing to do will be to get these
duplications adjusted. Then, after the
operation o f the Credit Association gets
into full swing, every member bank will
each week forward to the manager’s o f
fice a complete list o f all loans consumated the week previous, giving the
names and addresses o f the borrowers,
and the amount o f the loan.
W ill Give Complete Record
When a prospective borrower makes
application for a loan, the bank immedi
ately gets in touch with the Credit Asso
ciation office.
I f the individual has
money borrowed from any other bank in
the Association, the card file will give a
complete record, and the bank can act
accordingly.
It is well to mention here that the
manager o f the Credit Association office
accumulates information which has to do
only with duplicate borrowers. His rec
ord tells only the number o f banks from
which any certain individual may have
made loans. It has absolutely nothing
to do with the credit rating o f that indi
vidual, nor does the office make any effort
to obtain such information. Such find
ings are up to the bank making the loan.
Another, and perhaps the most impor
tant, feature o f the First Nebraska Bank
ers’ Credit Clearing House Association,
is the fact that the same examiner will
have charge o f the five counties in the
Association, and will confine all his ac
tivities to the banks in that district alone.
L . C. S O R E N S O N
(Continued on page 103)
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
22
L e f t — Iow a farm ers “ go to sch ool” and learn new fa c ts about sm all g rain raisin g. R ig h t— The 1927 state corn husking cham pion
ship at Gowrie, Iow a
Iowa Land Buying Com pany
Begins Actual W ork
WO men were seated in a day coach
riding through Iowa. They were
criticizing the state. Land values
had become demoralized they said— the
state was in bad shape— the farmers
were bankrupt and nothing seemed to be
really right with the greatest agricultural
spot on the globe.
Back o f these two “ boosters” sat a man
who believed in Iowa. He had been
brought up in Iowa. He had been edu
cated there. He had made his money
there. The longer these two men in the
front seat talked, the more he “ boiled.”
He knew that what they said was not the
prevailing opinion o f the citizens o f Iowa.
So when Burt J. Thompson, attorney of
Forest City, alighted from the train in
Des Moines he decided to do something
to counteract the adverse opinions which
these men had expressed about farm lands
in the Hawkeye state.
Out of his desire to really accomplish
something which would be constructive,
Mr. Thompson has been instrumental in
assisting in the organization plans of the
Iowa Farms Corporation, which will have
a capital o f $5,000,000, one million dollars
of which will be raised in Iowa and $4,000,000 in the East. This corporation
proposes to buy and operate hundreds o f
acres of good Iowa farm land, which can
now be purchased at the present low
prices.
T
Many o f the most influential business
men o f the state are back o f this move
ment. These men believe that it is a real
opportunity fo r those interested in the
future welfare o f Iowa to become stock
holders in this corporation, which can do
more than any individual could, to stabil
ize land prices in the agricultural heart
o f America.
Iowa Has Resources
Nothing that has transpired in the last
five years has changed in any way the
fertility o f Iowa soil. The products which
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
these fertile farms produce are still in
demand to help feed the world. Many
men with keen business judgment are
quietly buying farms here and there
throughout the state, which can now be
purchased at reasonable prices, knowing
full well that the time will soon come
when these same farms can be sold at a
very fine profit.
“ The greatest thing Iowa needs now,”
according to Burt J. Thompson, who is
the executive head o f the Iowa Farms Cor
poration, “ is a cheer-leader; someone who
will organize the grandstand so that it
will cheer in unison for its own home team.
This is exactly what the Iowa Farms Cor
poration intends to do, and is doing.”
The market price o f any product is
established by the demand fo r that
product. With a greater demand for
Iowa farms will come a better price for
these farms and thus benefit every farm
owner in the state.
The Iowa Farms Corporation move
ment is fo r the benefit o f all the state, and
not fo r a few individuals. The claim that
this organization is to benefit the rich is
absurd, because if a better market is cre
ated fo r Iowa farm lands it will help those
in distress by making it possible fo r them
to either hold on to the farm they have
or to sell them and save something. This
cannot be accomplished if no market is
created for Iowa farms at any price.
Good tenants will also be benefited be
cause the Iowa Faims Corporation will be
able to sell them farms if they make a
small down payment and pay the balance
over a long period o f time at a low rate
o f interest.
The real beginning o f the organization
was-made last month at a special meeting
o f business men from all parts o f Iowa,
held in DesiMoines. At this meeting sev
eral leading financiers pledge contribu
tions o f several thousand dollars as “ ex
pense” money, to form the skeleton o f an
organization through which it is proposed
to sell, first o f all, a million dollars worth
of stock among Iowa business men, as
their pledge o f faith in the proposition.
Later it is planned to market the remain
ing four million dollars worth of stock in
the East.
Getting back to fundamentals for a
moment, the primary object o f the pro
posed farm corporation, to buy up and
operate Iowa farm land, is to secure a safe
and profitable investment to those who
purchase its stock. It is in no sense a
charitable enterprise, nor is it intended to
relieve any bank or business o f the burden
o f carrying on their books any excess land
holdings. Its advocates are thoroughly
confident that it will create a renewed and
much needed confidence in Iowa business,
banks, mercantile establishments, fac
tories and normal investments, and that it
will have a bénéficient effect on the psy
chology o f Iowa people as a whole. The
latter effect has already been noticed, sev
eral bankers reporting increased land
sales in their communities a few days fo l
lowing the Des Moines meeting o f the cor
poration’s organizers.
The organizers contend that Iowa farm
land always has and always will be a safe
and secure type o f investment. Based on
present low prices they contend it is even
more than that. What is needed, they say,,
is some tangible evidence, to the world at
large, that Iowa business men have suffi
cient confidence in Iowa’s resources, and
fertility o f land, to invest their own money
in Iowa land. The proposed corporation
is their answer to this challenge.
W ill It Be Profitable?
They ask and answer these questions:
First, is there any sound basis for a be
lief in a general advance in farm land
values? Yes, there is national agitation
for legislation that will benefit agricul
ture. Ultimately this will succeed, it will
23
benefit agriculture and land values should
respond to this stimulant.
Second, is farm overhead decreasing so
that increased profit is made possible?
Yes, there is a constant increase in farm
efficiency, methods o f production, in ma
chinery, power and tools. Cost of produc
tion is therefore being constantly lessened.
Third, has the intrinsic value o f Iowa
farm land been decreased during the past
few years o f depression? No, not at all.
Iowa has the same climate, same fertility,
freedom from crop failure, the same soil,
and still ranks at the top o f the farm
states in America in wealth per capita,
value of farm lands, value o f farm prod
ucts, value o f live stock, value o f catt’ e
and hogs and proportionate amount o f
tillable soil.
As stated before, it is proposed to capi
talize the corporation at five million dol
lars, one million o f which will be sub
scribed in Iowa, the other four million
among outside investors. There is to be
no sales promotion expense, since its or
ganizers are determined to make it as clean
a business proposition as was ever con
ceived. Already a group of interested
Iowa business men have divided Iowa into
a dozen territorial units, will hold meet
ings in each area and secure the stock sub
scriptions o f each area in that way. The
larger cities will be asked to subscribe ac
cording to their size, Des Moines’ quota
being around a quarter of a million, etc.
The following list o f Iowa business men
have been named to head the organiza
tion’s activities: Burt J. Thompson, at
torney, Forest City, chairman; C. H.
McNider, president First National Bank,
Mason City; Frederick C. Hubbell, capi
talist, Des Moines; C. E. Perkins, director
C., B. & Q. Ry., Burlington; F. F. Everest,
president First National Bank, Council
Bluffs; Clyde E. Brenton, vice president
Iowa National Bank, Des Moines; L. H.
Henry, vice president First National
Bank, Sioux City; Col. G. W. French,
manufacturer, Davenport; E. W . Miller,
president Commercial National Bank,
W aterloo; Glenn M. Averill, president
llilllllillllllllllllllllllljl 1111111111111111111111111111111111111IIIlill[llll!llllllllllllll[|llllll!llll IIIlllll IIIllllllllllllll Will II
IO W A ’ S G O V E R N O R S A Y S :
“ T here are no im poverished sections
w ithin the borders of Iowa. T he u n i
versal attractiveness of her landscape
is u nexcelled. H er produ ctive resources
are m arvelous. H er citizenship is dis
tin guish ed b y the low est percentage of
illite ra c y of any state in the U nion. The
state is situated in the center of the
greatest agricu ltu ral area on the globe,
w h ich has becom e a m atter of w o rld
w ide recognition.
“ I b elieve it is no exaggeration to
claim that the best farm ing portions of
all the surrounding states are located op
posite the boundaries of Iowa.
“ W ith the natural conditions as they
are, Iow a’s real estate cannot help but
be of real value. Land is about the only
asset that produces any new w ealth at
the present tim e. In m y jud gm en t the
lands of Iow a are w orth much m ore and
w ill brin g returns on a m uch higher
valu ation than they are now sellin g for.
W e need faith in our lands.
“ T his corporation in m y judgm ent
w ill be a sustaining influence in return
ing confidence to Iowa and thus sta
b iliz e her land values. I have faith in
Iowa lands, in the men who are back of
this corporation and b elieve they are
m oved b y m otives that are of the h igh
est order and in the interest of the peop’ e of our State.”
iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii mili hi inn iiiiiiiii ii linn mu mu mi iiiiiiiiiiiiii in iiiiiiiiiiiii linn hi hin in mu in ii
Cedar Rapids National Bank, Cedar Rap
ids; Herbert Horton, secretary for com
mittee, vice president Des Moines National
Bank, Des Moines; H. IT. Stipp, attorney
fo r committee, Des Moines.
W hat They Say
Just how does the representative busi
ness man o f Iowa feel toward the pur
poses and probable effect o f the organiz
ation and functioning o f such a corpora
tion? In an effort to ascertain this, the
N o r t h w e s t e r n B a n k e r has compiled
statements from a number o f leading
Hawkeye financiers. Almost without ex
ception they say, “ Yes, it is a splendid
idea, a practical one and we will back it
with our money.”
Some individual comment follows:
‘ ‘ T he p lan fo r th e Io w a L a n d C orp ora
tio n ,” says C h arles H. M cN id e r, M ason
C ity b a n k er, “ is to ra ise in Io w a the sum
o f '$1,000,000 as e vid en ce o f our fa ith in
our ow n sta te and then p roceed to go E a s t
a n d b o rrow the re m a in in g $4,000,000 and
a fte r th a t to go in to the com m un ities and
p ic k up th e land th a t is fo rc e d on the m a r
k e t on w h ich the p rices th a t b a n k s and
oth ers h a v e been r e a liz in g on them h a v e
a b so lu te ly dem o ralized fa rm lan d v alu es.
“ W e b e lie v e th is sort o f p ro p ositio n ,
w h eth e r it ta k e s more form th an the effort
or not, is g o in g to be a w o n d e rfu l th in g
p sy c h o lo g ic a lly fo r the sta te. W e a lre a d y
see some re su lts from the a g ita tio n and i f
th e com pan y can be pu t fo rw a rd and some
in ve stm e n ts m ade, in m y ju d g m e n t Io w a
w ill come b a c k to her ow n fa rm v a lu e s in
v e r y sh ort order.
“ I b e lie v e in th is e n tire ly . I h a v e been
b u y in g a con sid erab le num ber o f fa rm s m y
s e lf fo r m y p erson al use, w h ich are n ot fo r
sale and w h ich I re g a rd sim p ly as good
an in ve stm e n t as I could m ake. ’ ’
W ill Stabilize Values
Says T. A. Murphy, assistant treasurer
o f the Merchants L ife Insurance Com
pany, Des M oines:
‘ ‘ The am ount o f m on ey to be in v e ste d
b y th e proposed five m illio n d o lla r co rp o ra
tio n w ill not h a v e a n y a p p re cia b le a ffe c t
upon la n d v a lu e s in th e sta te, b u t th e f a c t
th a t men o f ju d gm e n t, in te llig e n ce and
fin a n cia l m eans are w illin g to b a c k th eir
ju d gm en t w ith th e ir d o llars to b u y even a
sm all num ber o f farm s w ill be o f im m ense
help in s ta b iliz in g la n d valu es.
“ T here is no lo g ic a l re a so n in g th a t w ill
sh ow th e v a lu e o f Io w a farm s, based upon
th eir p ro d u ctiv e retu rn s, to be less a t th is
tim e th an th e y w ere in 1917, b u t th e a t t i
tu de o f a g r e a t m an y people is th a t th e y
are n ot w o rth a n y th in g lik e w h a t th e y w ere
a t th a t tim e.
“ T here are te n a n ts who h a v e sa v ed some
m on ey in the la st fe w y e a rs, re tire d fa r m
ers w ith some m eans, and sp ecu la to rs w it h
out num ber, a ll s ittin g around lik e v u l
tu res, w a itin g fo r th e tim e w h en some farm
th a t is in d istress to be th ro w n on the m a r
k e t a t a p rice w a y b elo w its v a lu e ; then
th e y are w illin g to b u y. One o f th e w o rst
fe a tu re s o f th e presen t slum p in land v alu es
is th a t th ere does not seem to be a n y one
who has a definite id ea o f the v alu e o f
farm s, and the people who w o uld be w ill
in g to in v e st th e ir m on ey in these farm s
are w a itin g fo r the bo ttom p rice and do
not recogn ize th e bo ttom p rice w h en it has
a rriv ed .
“ I b e lie v e th e plans, as ou tlin ed , fo r th e
A b o ve— Tw o ty p ic a l Iow a hom esteads w ith new and com fortable b u ild in gs
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
24
estab lish m e n t o f th is five m illio n d o llar
corp o ra tio n is an e x c e lle n t one and w ill r e
su lt in s ta b iliz in g and im p ro v in g to a con
sid erab le e x te n t th e sale v alu e o f Io w a
farm s. The p ro d u ctiv e v alu e o f the land
is ju s t as good now as it w a s fro m 1913 to
1917 and th ere is no reason w h y farm s
should not sell fo r as good a price as th e y
did d u rin g th a t period , w h ich w as b e fo re
th e so-called b o o m .”
Bargains Await Buyers
Prank C. Waples, president o f the M id
land Mortgage Co. o f Cedar Rapids, a
past president o f the Mortgage Bankers
Association o f America, says :
“ I th in k th a t Io w a fa rm land or midw estern fa rm land to d a y can be b o u g h t a t
less p rices th an it w ill be b o u g h t in m an y
y e a rs to come and th a t it is a d is tin c t b a r
g a in a t t o d a y ’ s p rices, and th a t m on ey can
he m ade b y the pu rch ase o f such la n d and
th e h o ld in g o f it, in th e m eantim e fa r m in g
it fro m an in te llig e n t stan d p o in t th a t w ill
keep up the f e r t i li t y o f th e soil.
‘ ‘ Such farm s in th e fu tu re , I b e lie v e , w ill
b r in g con sid erab le more m on ey th an th e y
can be b o u g h t fo r to d a y , and I am sa tisfied
(Continued on p age 55)
Reveals Plans for N ew Merger
LANS for the consolidation o f the
Chicago Trust Company and the Na
tional Bank o f Commerce under the
name of the Chicago Trust Company, with
total resources o f about $44,000,000, de
posits o f $36,000,000, and surplus and un
divided profits o f about $2,300,000, have
been disclosed by Lucius Teter, president
o f the Chicago Trust Company. The busi
ness o f the combined organizations will be
carried on from the Chicago Trust’s loca
tion, Monroe and Clark Streets. The
merger becomes effective December 1.
P
cago Trust Company. Ralph N. Ballou,
vice president and cashier, and H. B.
Ahrensfeld, assistant cashier o f the Na
tional Bank o f Commerce, will become
vice president and assistant cashier, re
spectively, o f the Chicago Trust Com
pany. The entire remaining staff o f the
Commerce Bank will also be affiliated
with the Chicago Trust Company.
tal was again increased from $500,000 to
$600,000, and on May 25, 1926, the capi
tal was increased from $600,000 to $800,000. In 1918 it moved from the Ogden
building to the Ashland block, located at
the northeast corner o f Clark and Ran
dolph Streets, where the business has
steadily increased to total deposits o f
about $6,000,000.
The National Bank o f Commerce in
Chicago was organized in the fall o f 1907
as the National Produce Bank o f Chicago
and opened fo r business at the corner of
Organized Outlying Banks
As a part o f the merger plan, the stock
o f the Chicago Trust Company will be
increased from $2,000,000 to $2,400,000,
the increased capital being used fo r an
exchange o f one-half share o f Chicago
Trust for each share o f National Bank o f
Commerce stock.
Stockholders o f the
latter institution also will receive approx
imately $50 a share in cash for each share
they hold.
Absorbs Commerce Trust Bank
The stock o f the Commerce Trust and
Savings Bank, located in the South W a
ter market, which formerly had been held
in trust for the benefit o f stockholders of
the National Bank o f Commerce, will also
be distributed simultaneously with the
closing o f the merger on the basis o f onequarter share for one. The quarter share
at present market has a value o f $37.50.
In the future that institution will operate
separately as an independent bank.
Stockholders o f the Chicago Trust
Company will meet December 20 to con
firm the action o f directors o f that bank.
“ The fundamental reason fo r the con
solidation,” said Mr. Teter, “ is based on
the desire on the part o f the directors and
officers o f the National Bank o f Com
merce to secure a fuller and more com
plete banking service for their customers
than they alone were able to give.”
Wagner Becomes Vice President
Edwin L. Wagner, president o f the
National Bank o f Commerce, will become
a vice president and director o f Chicago
Trust Company. Charles W. Higley, one
o f the incorporators, and a member o f the
board o f directors o f the Commerce bank,
also will become a director o f the Chi
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
L U C IU S T E T E R
Clark and Lake Streets with a capital o f
$250,000 and surplus o f $50,000. The
bank shortly afterwards moved from
temporary offices on the North side o f
Lake Street to the Ogden building at the
southwest corner o f Clark and Lake
Streets, where it remained fo r ten years
and in the interim increased its capital
from $250,000 to $300,000 with a stock
increase o f 20 per cent.
On October 19, 1917, the bank in
creased its capital from $300,000 to $500,000, and on November 12, 1919, the capi
Edwin L. Wagner, its president, and
one o f its original incorporators, previ
ously to the organization o f the National
Bank o f Commerce, was assistant cashier
o f the old American Trust and Savings
Bank, later merged with the Continental
and Commercial Bank. Ralph N. Ballou,
vice president o f the Commerce Bank,
and also one o f its incorporators, during
the past twenty years, has been promi
nently identified with Mr. Wagner in the
organization o f a large number o f outly
ing banks, many o f which have grown to
positions o f dominance in their territor
ies.
Chicago Trust Company opened its
doors fo r business May 1, 1902, as the
Chicago Savings Bank, with a capital of
$250,000. In 1904 the bank changed its
name to Chicago Savings Bank and Trust
Company and its capital was increased
from $250,000 to $500,000.
The full
credit loan functions o f a commercial
banking organization were assumed in
1807. The capital was again doubled in
1911 to $1,000,000. In 1919 the corporate
name was changed to its final form, “ Chi
cago Trust Company,” and two years
later the capital was increased to $1,500,000.
During 1905 it moved to a location on
the southwest corner o f State and Madi
son Streets. Here it built itself into Chi
cago’s history and remained until early
in the fall of 1923, when it moved into its
present quarters, southeast corner o f
Monroe and Clark Streets, with deposits
o f $15,976,386.79 and total resources of
$20,066,855.23. Its deposits at the time
o f the last bank call, October 10, 1927,
were $27,904,282.52, and its resources
$34,267,149.60. Lucius Teter was one o f
the organizers o f the bank and became
its president in January, 1908, which o f
fice he continues to hold.
25
You M ust Have Been Impressed!
OU, the officers of the banking institutions in this territory, must
have been impressed— as we in the investment business are—with
Y
the changes that have, in the past several years, occurred in the field of
selling and buying investment securities.
This development is reflected, not only in the large increase in the
volume of sound securities purchased and owned by your banks, but more
strikingly in the changed attitude of the average American Citizen toward
investment securities and their relation to his financial success.
With this development has come a definite responsibility to the banks.
Investors and future investors— look to your bank for
DEPENDABLE
S E C U R IT IE S
and
IN T E L L IG E N T
CO UNSEL
In meeting this important situation the bank clients of The \\ hitePhillips Company have had the advantage of a service which has gained
for this institution the name of “ The Investment Banking House of
Service.”
This service includes not only a diversified list of sound securities but
also quotations and information service— individual investment analysis
of the holdings of banks and investors, and definite co-operation between
the issuing house and the banks, extended by alert and experienced
representatives of this company.
Let us explain our service to YOU.
D A V E N P O R T — IO W A
DES M O IN E S — D U B U Q U E — C H IC A G O — O M A H A
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
26
Æ \
V|T
i
l e a d e r s h ip
in Banking
MEANS—
7. Knowledge
2. Accuracy
3. Promptness
4. Resourcefulness
— these important factors, together with courtesy and
efficiency, have made The Omaha National Bank
known as the institution where your banking service is
both complete and satisfactory.
I
T he O m a h a N a t i o n a l Ba n k
WALTER
W.
HEAD
,
President
OMAHA, NEBRASKA
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
27
As seen from an editorial trip
HERE
and T H E R E
in N E B R A S K A
through the Cornhusker state
By H . H . H A Y N E S
Associate Manager
NORTHWESTERN BANKER
ITH a bumper wheat crop to its
credit, with corn in most cases
running well above the average
yield, and with winter wheat going into
the cold weather in excellent condition,
Nebraska bankers this year have every
reason to feel optimistic, and they do.
From Fremont down through the Platte
River Valley to Lexington, and back
through Minden, Hastings, Lincoln, and
Nebraska City, everyone is happy.
It has been during recent years that
the fertile land on the Platte River bot
toms came under cultivation. For many
years it was covered with acre after acre
o f wild hay, and had never felt the plow.
There is still some wild hay left here
and there, but for the most part corn
and small grains now contribute from
this valley their share of the state’s vast
wealth.
W
The banks o f Fremont all report con
ditions as being excellent, with plenty
o f money on hand to take care o f all
legitimate loans. The same report comes
from Schuyler. Colfax county, in which
Schuyler is located, will feed considerable
livestock this winter.
the majority o f the stock. He also is
the owner o f several thousand acres o f
excellent farm land near Columbus, be
sides other business interests in the city.
The banks o f Columbus, o f which there
are five, have combined deposits of more
than eight million dollars.
I. R. Alter, president o f the First Na
tional Bank o f Grand Island, in comment
ing on the business outlook in that vicin
ity says :
“ Conditions in this territory are excel
lent, especially from the farm stand
point. W e had a big corn crop, and there
will be more cattle fed here this coming
winter than fo r many years past. Our
short crop fo r several years past has
cleaned most o f the cattle out of the
country, and I look for cattle prices to
hold up well fo r the next three or four
years, as it will take about that long
for the farms to become restocked to a
normal basis. W hile most banks are
carrying considerable cash, I believe the
cattle financing demand will absorb a
large part o f our surplus funds.”
Bankers o f Hastings report the out
look as very favorable. There is not
quite so much cattle feeding in the
Hastings territory as there is farther
north, but the bankers there do not an
ticipate having any trouble in placing
their surplus funds locally.
Other Grand Island banks also make
favorable reports. A. J. Guendel, presi
dent o f the Nebraska State Bank, is quite
optimistic. He heads one o f the fastest
growing banks in Nebraska, and while
his increase in business has been secured
through no unusual methods, it is nevertheless a substantial and steadily-grow
ing institution. The use o f direct mail
letters has been the Nebraska state’s big
gest business getter, soliciting deposits
through their conservative policy. The
slogan o f the bank is “ A Conservative
Bank for Conservative People.”
Hold Harvest Party
Chas. C. McEndree, president o f the
Farmers State Bank at Central City, re
ports conditions in that vicinity as being
in fine shape. He feels that crops and
livestock, if prices hold up to what they
should, will pay farmers a nice profit this
year. The Farmers State, under careful
management during the past several years
o f inflation, has come through the period
o f depression with flying colors. Mr.
McEndree says his institution is con
sidering nationalization in the near
future.
The corn around Columbus is husking
out about fifty bushels to the acre, and
good farm land selling from $185 to $225
per acre, according to William Bucher,
president o f the Farmers State Bank of
that city. The Farmers State is compara
tively a new institution, as banks go,
being organized but ten years ago. It is
peculiar to note that the days after the
bank opened in 1917, a call was issued,
and the assets o f the Farmers State were
listed on this first report at $80,000.
Today the bank has assets o f $1,060,000,
just a million more than it had ten years
ago.
There are but four stockholders in the
Farmers State, and Mr. Bucher owns
M em bers o f the Fellow ship
Club, G uardian N a tio n a l B an k o f C hicago, a t their
‘ ‘ H arvest ’ ’ p a rty
HE Fellowship Club o f the Guardian
National Bank o f Chicago, consisting
o f employes, held a harvest and Hal
loween party in the main banking room
recently, at which the officers and directors
Avere guests.
T
The room Avas artistically decorated in
keeping with the season.
Dinner was
served in an adjoining room, followed by
entertainment. Everyone there reported
a thoroughly enjoyable time, and the
employes were Aroted real hosts.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
28
W ith a bumper crop this year, and if
prices are at all favorable, farmers this
year should realize a good profit, is the
opinion o f Elmer Williams, president of
the Commercial State Bank. Mr. W il
liams also reports plenty o f cash on hand,
with some cattle financing.
J. H. Lohmann, cashier o f the Ne
braska National at Hastings, says that
his institution has plenty o f money, and
that they are financing a few cattle. He
contrasts this year to last, when it was
necessary to ship in corn for feed. Notv
there is an abundance.
Deposits are making a steady and con
sistent gain at the First National ac
cording to A. D. Marvel, vice president
o f that institution. Conditions this year
are much better than last, and good farm
land is selling around $125 to $150 per
acre.
“ Farmers are showing an inclination
to pay off their debts,” stated 0. A. Riley,
cashier o f the State Bank o f Hastings.
“ It is natural that they should, fo r we
had wonderful crops in this section this
year. There is going to be some money
made in livestock this coming winter
and spring, but there is not as much
cattle feeding in this part o f the state as
other localities.
Feeding here mostly
runs to hogs, which, o f course, are more
A dividend record
uninterrupted for 47 years
yH R O U G H almost a complete h a lf century, A . T . & T .
Z
and its predecessor
have paid dividends regularly.
Its
earnings— increasing each year — provide an ample margin
o f safety above dividend requirements, thus increasing the
stockholder1s equity.
V ita l f a c t s f o r
investors to know
about
A.
T . Ì3' T . :
B ell System service has ever kept pace with the nation’ s develop
ment. SI Its management is far-sighted, conservative, and yet
progressive. If Its laboratories employ 3,500 trained workers,
searching for means to bring the n a tio n ’ s telephone service
nearer to perfection. Cj Its plant investment o f £3,000,000,000
includes telephone and central office equipment costing over
$1,000,000,000, over 54,000,000 miles of wire, 16,000,000
poles and 2,000 owned buddings. C[ A . T . & T . owns over
9 i % of the combined common stocks o f the operating companies
o f the B ell System. CJ Its stock can be bought in the open market to
secure a good return. W rite for booklet, “ Some Financial F acts.”
c
BELL T E L E P H O N E
S E C U R IT IE S C O .
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
liquid as far as assets are concerned than
cattle.”
“ Our deposits are holding steady, and
we have a nice local demand for money
which we can easily meet. We, o f course,,
buy bonds with a part o f our surplusfund.”
L. P. Sornson, president o f the City
State Bank at Sutton, reports but few
cattle in his territory, but says there
are more coming in every day. They
had an exceptional wheat crop this year,,
and the fall planting is looking good.
Money in the vicinity o f Sutton is easy,
and what funds are not absorbed locally
the City State is investing in bonds.
Business conditions in the vicinity o f
Grafton are good, states Thomas N.
Burke, president o f the Grafton State
Bank. Mr. Burke enjoys the reputation
o f being one o f the shrewdest bond buy
ers in the state when it comes to the in
vestment o f his surplus funds. His bank,
as are the other banks in Fillmore county,
has reduced the interest rates on time
and savings deposits to three per cent,
which gives him a chance to make some
profit. The Grafton State pays one per
cent on demand deposits for six months,
and two per cent on demand deposits fo r
one year.
“ Farm land is not moving very rapidly
here in York county,” said J. R. McCloud,
cashier o f the First National Bank o f
York. “ Farm conditions, however, are
excellent, and the corn here will easily
average more than forty bushels to the
acre. There are a few cattle being fed,
but the most o f this corn crop will go
into hogs. In any event, we have plenty
o f money to finance our farmers, and fo r
any other worthy business enterprise.
Bankers o f Nebraska City also report
everything moving in nice shape. The
soil and climate around Nebraska City
seems to be especially adapted to horti
culture, and here are located acre after
acre o f orchards, all contributing in no
small measure to the wealth o f Otoe
county. Many carloads o f apples are
shipped from this section every season.
The outlook visioned by these several
bankers might be considered a cross-sec
tion o f conditions as they exist generally
throughout Nebraska. Things are boom
ing, but there is no inflation. The fact
that there is plenty o f ready money every
where is not going to anyone’s head.
W hile it is true that conditions are much
more prosperous than they have been fo r
several years past, it is a stabilized pros
perity, and a condition that has come to
stay. As one banker puts it, “ Crops are
g o o d ; prices are fair, and everyone is
happy.”
29
HE year of 1928 will mark the
fifty-eighth anniversary of the
American
Commercial
and
Savings Bank.
Since 1869 this institution has been
serving a constantly expanding terri
tory and has maintained a record of
personal service and loyalty to custom
ers and correspondent banks.
The years have brought many friends
and a wonderful growth.
: ;■■■
'
The past year saw with the merging
of the American Commercial and Sav
■ 11 1
ings Bank and its neighbor the Iowa
SÉilli
National Bank, the realization of an
ideal long possessed by the officers of
-
this institution.
There
has
been
created— Daven
i i l i
. . t
( I
■■
port and Iowa’s largest bank with total
■I
_
(H ÌB P I
resources of over $30,000,000.00 and
an official organization known through
2 BE t *
out this great territory for their knowl
edge, experience and spirit of coopera
‘i
*
t .1
u
!« ■
~•
i
-
tion.
Today— as was true yesterday and
will be even more true tomorrow—
we are anxious to serve you.
C apital $1,500,000.00
Surplus and P rofits $1,500,000.00
O F F IC E R S
E D . K A U F M A N N ...................P residen t
R A Y N Y E M A S T E R ................V ic e P res.
H.
P. O E T Z M A N N ..............V ic e P res.
F R A N K B. Y E T T E R ............. V ic e Pres.
L O U IS G. B E I N ........................... Cashier
F.
C. K R O E G E R ........ A ssist. Cashier
F. A . J O H N S O N ...........A ssist. Cashier
J. D . B R O C K M A N N .. .A s s is t. C ashier
A. H . H I E G E L .............. A ssist. Cashier
H E R M A N S T A A K ........A ssist. Cashier
A M E R IC A N
COMMERCIAL / SAVINGS BANK
D A V E N P O R T IO W A
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er Î927
30
Oorsom CQarapm pfis
Lucius Teter, President o f Chicago
Trust Company, spoke before the Chi
cago Mortgage Bankers’ Association re
cently at the Union League Club, Chi
cago, using as his subject, “ The Attitude
and Relationship o f Banking Institutions
Toward the Real Estate Mortgage Field.”
A Specialized
Service
for
Banks
and
Bankers
which is the result of more
than sixty years o f experi
ence is offered by
THE FIRST
N ATIO N AL
B A N K OF
CHICAGO
THE FIRST
T R U S T and
SAVING S
BANK
Complete facilities are pro
vided for active and inac
tive accounts, collections,
bills of lading, investments
Announcement is made o f the election
o f Walter L. Dunham as president, and
James H. Doherty as vice president, o f
the Detroit Savings Bank. Until recently
Mr. Dunham held the office o f vice presi
dent o f the First National Bank o f De
troit.
Francis H. Sisson, vice president o f the
Guaranty Trust Company, New York,
said in a recent address concerning fu
ture business, that the outlook is fo r the
continuance o f trade and industry at a
rate comparable with that o f the early
part o f this year.
In general, pride is at the bottom of
all great mistakes.— Ruskin.
W . B. Geery, governor, and John R.
Lawrence Stern and Company
231 South La Salle Street - Chicago
BOARD OF DIRECTORS
J O H N H E R T Z , Chairman of the Board of
the Board o f W illiam W rigley Jr. Company
M E L V IN A . T R A Y L O R , P resid en t
Y ellow Truck & Coach Manufacturing C o.
A L B E R T D . L A S K E R , Chairman of the
H E R B E R T L. ST E R N , President of
Board of Lord & Thomas and Logan
STUYVESAN T
PEABODY,
Balaban & Katz Corporation
President
A L F R E D E T T L IN G E R , Vice President
of Peabody Coal Company
JOSEPH J. R IC E , Vice President
C H A R L E S A . M cC U L L O C H , President
L A W R E N C E ST E R N , President
o f T h e Parmelee Company
Combined Resources
Exceed $450,000,000
Charles F. Pfister, prominent W iscon
sin banker, died recently at the home o f
his daughter in Milwaukee. Mr. Pfister
was a director o f the First Wisconsin
National in Milwaukee, as well as one of
the bank’s largest stockholders.
The philosopher is the lover of wisdom
and truth. To be a sage, is to avoid the
senseless and the depraved. The phi
losopher therefore should live only among
philosophers.— Voltaire.
Eugene M. Stevens, president o f the
Illinois Merchants Trust Company, was
elected a member o f the clearing house
committee to fill the vacancy caused by
the death o f John J. Mitchell.
W IL L IA M W R IG L E Y , JR., Chairman of
F R A N K O. W E T M O E E , Chairman
A.
E. Phipps, Toronto, general man
ager o f the Imperial Bank o f Canada,
was recently elected president o f the
Canadian Bankers’ Association, succeed
ing C. E. Neill, who retires after two
years’ occupancy o f the chair.
A great character, founded on the liv
ing rock o f principle, is, in fact, not a
solitary phenomenon, to be at once per
ceived, limited, and described. It is a
dispensation of Providence, designed to
have, not only an immediate, but a con
tinuous, progressive, and never-ending
agency.— Everett.
Leroy A. Goddard, chairman o f the
board o f the State Bank o f Chicago, has
been elected vice president o f the Chi
cago Clearing House Association to till
the vacancy caused by the death o f Ralph
Van Vechten.
and foreign e x c h a n g e
transactions
Mitchell reserve agent, o f the Minneapo
lis Federal Reserve Bank, returned re
cently from Washington where they were
in attendance upon the conference of
governors and reserve agents with the
Federal Reserve Board.
&
This company conducts a general securities business, originating
and participating in high-grade investment issues
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
December 1927
;b i
Death of John J. Mitchell
one of the imposing financial institutions
o f the United States.
In the panic o f 1893 Mr. Mitchell got
his first test under fire. The failure of a
bank in Milwaukee of which the president
was a John Mitchell, who had no relation
ship or other connection with the Chicago
banker, engendered a heavy run on Illi
nois Trust and Savings Bank. John J.
Mitchell laid down the policy that every
demand should be met and only after pay
ing out nearly a million dollars to depos
itors carried his bank through the crisis.
In 1907 another panic came, and this
time he sat in the councils o f the greatest
monetary powers in the country, to carry
J O H N J. M I T C H E L L
N ov. 1853— Oct. 1927
HE business world suffered a tre
mendous loss last month in the ac
cidental death o f John J. Mitchell,
chairman o f the board o f the Illinois Mer
chants’ Trust Company o f Chicago, who
was killed, together with his wife, when
their automobile turned over near Libertyville, 111., fo r Mr. Mitchell was an inter
national figure in the financial world.
A building o f its own was erected
in 1897. A consolidation was effected in
1923. The Illinois Trust and Savings
Bank, the Merchants Loan and Trust
Company, and the Corn Exchange Na
tional Bank were united into the Illinois
Merchants Trust Company. Growth con
tinued, and the bank today represents
nearly a billion dollars o f wealth, in point
o f capital invested, savings and commer
cial deposits held and trust funds in its
charge. It has the largest savings depos
its o f any bank west o f New York and is
Mr. Mitchell sat on the directorates o f
big corporations, with long lives behind
them and conservative managements di
recting them. These included the Pulhnan
Company, the Commonwealth Edison
Company, the International Harvester
Company, the Pittsburgh, Fort Wayne
FOREMAN.
M
l f l l P
'
T
His career was a romance in itself . Most
o f his boyhood was spent in Alton, 111.,
and he became assistant cashier o f the
Illinois Trust and Savings Bank in 1878.
An institution with half a million dollars
capital, and a small office, it became finan
cially embarrassed, and only through an
intelligent plan o f refinancing, produced
from Mr. Mitchell’s fertile mind, was the
institution preserved. Two years later in
recognition o f his plan, he was made
president.
The history o f Mr. Mitchell’s rise in the
banking world during later years is a
matter o f history.
the banks and their customers through the
emergency. In 1913 when the federal re
serve system was being formulated John
J. Mitchell was consulted by the Washing
ton administration, as to the theories and
policies upon which the banking scheme
would be established. When the reserve
system was firmly established he was
called upon to assist in its guidance. He
was a member o f the advisory council of
the system and for a time represented the
middle west in the deliberations with the
federal reserve board.
i
Ä V SAV1ÍI
IN K
LiC A j
Personal Service
U R wide facilities, not only
here, but in more than
ioo foreign countries, make this
an ideal connection for you— one
characterized by the personal note
which is never lacking at this
friendly big bank.
O
The Foreman National Bank
The Foreman Trust and Savings Bank
L a S a lle a n d W a s h in g to n S treets, C h ic a g o
R E SO U R CE S
EX CEE D
I OO
M ILLIO N
DOLLARS
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
32
& Chicago Railway, the Illinois Bell
Telephone Company, the Peoples Gas
Light and Coke Company, the Chase Na
tional Bank o f New York, and also the
Chicago & Alton Railway Company. He
was a trustee and member o f the advisory
committee o f the American Surety Com
pany and a trustee o f the Mutual Life In
surance Company. His civic interest was
represented by his association with the
Chicago Civic Opera Company and the
Art Institute o f Chicago.
Wanted to Retire
F or some years Mr. Mitchell had the
ambition to retire from active business
We Appreciate
Our Friends
but his associates and friends would not
permit it. At the time o f the consolida
tion o f his bank with two others he was
preparing- to relinquish active manage
ment of the enlarged institution. The man
selected fo r president, Edmund D. Hulbert, died and Mr. Mitchell was pressed
back into service. He served as president
until early this year when Ernest A. Hamill, chairman o f the board, also passed to
the great beyond.
Mr. Mitchell seized the opportunity and
turned active direction o f the bank over to
Eugene M. Stevens, who became president
last February, and Mr. Mitchell was made
chairman o f the board. He was guiding
Mr. Stevens through h's early responsi
bilities when he became seriously ill. His
clean and active life carried him through,
however, and he returned to the bank to
SHORT
TERM
again take up the reins. His fam ily and
friends importuned him, however, and in
the last four months he had been gradually
freeing himself of all detail so that he
first might have more leisure and that the
organization of the bank might be ad
justed to just such a contingency as oc
curred. Mr. Mitchell wanted his business
house in order.
ARE W E P LA Y IN G TOO MUCH GOLF?
(Continued from page 15)
to year. However, it seems to me it would
take a genius or a juggler to maintain a
fair standard o f living, pay the going
prices fo r farm machinery and equipment
and guess at all accurately on what his
lot will be a year hence.
“ I believe that a reasonable amount o f
INVESTMENTS
FOR
BANKS
W ho had faith in
South Dakota
!
T hough they have gone through many
tryin g days during the past few years,
South D akota banks never once lost faith
in their a b ility to “ com e b a ck ” q u ickly
w ith a return o f norm al con ditions.
NOTE
THE
F O L L O W IN G :
W ith m ore norm al con dition s p revailin g
now, inclu d in g a norm al c r o p :
1. Bank d eposits have already increased
$17,000,000 (O c t. 10), or an average of
$40,000 per bank.
2. Further increases are yet to com e in
the b ig corn and h og territory o f South
D akota during the w inter and early spring
months.
3. Banks u n iform ly have a greatly im
p roved reserve con dition, and generally
are d iv ersify in g their loans b y carrying
secondary reserves in bonds.
4 There w ill be a great decrease in the
delinquent tax list.
UR
shorts
obligations loaves been pur
chased by more than._> y ooo
banks in the United States.
5. W h ile farm ers as a w hole do not have
much im m ediate w ork in g capital le ft after
reducing their b ills payable, yet—
6. T hey are op tim istic for the future, in
that there is a liv e ly dem and for farm s and
as a w hole the im proved farm s have been
taken by tenants for next season.
7. Banks are m ore u n iform ly ch arging
for services rendered, ch arging on un
profitable ch ecking accounts and stickin g
m ore clo s e ly to banking lines, and—
8. Bank patrons are gen erally taking
m ore kindly to these changes in banking
practices.
A ll the fo reg o in g im p ly a return of
p u b lic confidence.
South Dakota Has Faith
in Herself
South Dakota Bankers Assn.
Huron, S. Dak.
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Executive Office ' L 5 0 W E S T 5 7 1 » S T . * New York d ry
Capitaly Surplus & Undivided
Profits . $50,62.6,000
t
N orth w estern B anker
G eneral M otors
A cceptance Corporation
D ecem b er 1927
33
recreation is one of the essentials o f a well
rounded out, well balanced career, and
know there will be some who spend more
time at this than they should, and others
spend less than they should, but do not
believe the g olf course should be criti
cized for folks going to either extreme.
“ I also believe that stabilization o f ag
ricultural prices within a reasonable range
will go a long ways toward correcting
agricultural troubles, and believe we are
only side stepping the question when we
talk about the farmers not working.”
“ Mr. Giannini Is R igh t!”
W . Z. Sharp, president o f the Security
National Bank o f Sioux Fa’ ls, fee’ s that
the California banker is right in his views.
He says:
“ I think the farmer has to work out
his own situation the same as any other
business, as farming now is a business
in itself. When a merchant gets into
trouble, financially or otherwise, he has
his own situation to work out. That is
true o f the banker, the grain man and all
other lines o f business.
“ I think there is absolutely too much
money spent on sports—not only money
spent but time lost. W e are overrun
with football, base ball, golf, prize fights
and wrestling matches. Compared with
twenty years ago we are spending fifteen
to twenty times as much on the above
mentioned sports. I think this is some
thing for the more conservative people to
think about and give a little attention to.”
Some Play Very Necessary
“ Just what do you mean by ‘g o lf’ ” asks
W alter W . Head, president of the Omaha
National Bank, who goes on to sa y :
“ In my judgment it all depends upon
the use which is made o f g olf— using this
term to cover a multitude o f virtues and
vices as the case may be. I f golf means
wholesale recreation, there is not too
much o f it. I f g olf means excessive dis-
Your Bank’s Problems
Are Transferred to Us
It is our daily duty and pleasure to be of
personal service to our correspondent
banks and their customers. Every day
we serve in some way . . . making
some task easier for our patrons.
Our relationship with some banks has
existed more than half a century. We
have served our customers faithfully
and have their confidence in return.
I
A Complete Banking Service
We have every possible banking service in addition
to our personal service. You may take advantage of
every department. Our officers are always glad to
welcome you as well as your business.
F.
H. D A V IS
P r e s id e n t
M r s t N a tion a l
A
B
a n k
o f
O
m
a
h
C. T . K O U N T Z E
V ic e P r e s id e n t
a n d C h a ir m a n
a
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
34
We Invite
banks and bank
ers with Chicago
problems to
make a connec
tion with us.
Severe demands
are a welcome
test of a service
which we think
has something
additional incare
and exactness.
traction from more serious tasks of life,
there is too much o f it. W ork, hard work,
and plenty of it, is absolutely essential if
a man is to achieve real success. On the
other hand, work without play is very
likely to result in inability to enjoy the
fruits o f success.”
Farmers Not ‘ ‘Overgolfed”
Lack o f industry cannot be charged
against the farmer, is the frank statement
made by one o f agriculture’s staunchest
defenders, J. M. Dinwiddie, president of
the Cedar Rapids Savings Bank and Trust
Company, who says pointedly:
“ No doubt Mr. G. who wrote that or
had that interview is a great financier,
but he does not live with the Mid-west
Farmer, nor come into close contact with
him, hence, is hardly the person to speak
fo r him. He is, in his way no doubt, a
hard worker, but when he intimates that
the farmer is not, or that that is about
all he needs in the way o f relief, he simply
expresses the average opinion of the over
rich. I f the farmer can live long enough
to overcome his almost forced deflation
somewhat assisted by the severe demands
o f the Federal Reserve as to his liquida
tion, and in a hazardous time at that,
he may come out o f it as it were, but the
way along will be strewn with corpses
that with a little effort or restraint on
the part o f those who forced untimely
liquidation might have been with us today
to help on through. W hile the party
interviewed is unreasonable in his
general charge against the farmer, his
charge o f laziness is grossly unfounded—he does not try later to qualify. I hardly
see just why anyone should take time to
write concerning something said with
out due thought, and said by a party who
lives a long way from the scenes that he
is supposed to be talking about.
“ Of course, hard work anywhere must
precede success, however well the plans
may be laid, but my observation is that
both the farmer, his wife and his chil
dren do work, but the extreme between
what he secures fo r his work and the
overhead to produce it have been such as
to discourage him. The farmer asks no
charity— he does ask an even break. His,
is the biggest business in the world, and,
o f course, unorganized. The very nature
o f his business makes it so. He pays
what he is asked fo r what he buys, he
cannot help himself. He sells what those
who buy o f him tell him he must take
from them for what he raises, and cannot,
help himself. I do not believe the Gov
ernment should go into the farming busi
ness, but I am firmly convinced there can.
be much more done to assist the farmer
in equalizing his unequal load, and that
that can be done better by the Govern
ment that by any other Agency. It is the
monotony o f life in Rural Communities
that at times make it almost unbearable,
in places at least. That some source o f
amusement, some pleasure long denied
should be theirs while they, like an im
prisoned bird perhaps, are now beating
their wings against the cage waiting for
it, and when it comes to them perhaps
some go beyond the limit sometimes, but
I do not believe any more so than any
other class o f people. The auto, radio
and other like relief from the monotony
o f the morning to night, day in and day
out grind is perhaps more o f a blessing
after all than the man interviewed would
make o f it a curse. I will venture that
(Continued on page 53)
Ready for Winter?
(L i t t l e T a l k s o n T i lin g N o .
30)
H E R E are a lw a y s a great
co n d itio n o f the lan d, IS IT
m an y th in g s to th in k a b ou t
T IL E D R A I N E D ? I f y o u have
in p re p a ra tio n fo r w in ter. The
a tilin g system r e a d y to go to
ba n k er asks his fa rm e r cu s
w o r k fo r y o u w ith the first th aw
tom er, “ seed all re a d y fo r
o f sp rin g , then y o u are rea d y
sp rin g p la n tin g ? F a ll p lo w in g
fo r w in ter. A co u n ty w id e corn
fin ish ed? H o w m a n y h orses are
y ie ld con test has p ro v e n year
y o u w in t e r in g ? ”
T here is an
a fte r y e a r that tilin g pays. E v
oth er im p o rta n t q u estion that
ery p lo t that y ie ld e d over 100
the b a n k er is in terested in, and
bushels
p er
acre
w as
tile
that is, “ w h a t w ill y o u r la n d
drain ed. A sk y o u r fa rm er cus
p ro d u ce n e x t y e a r ? ” T o d e te r
tom ers if th ey are re a d y fo r
m ine that y o u m ust k n o w the
w in ter.
T
CHiaGoltusr
©MMNY
Lucius Téter JohnW O'Leary
President ~
It saves a year if tile is laid in the fall.
Don’t advise waiting until spring.
Vice-President
C H IC A G O
M a s o n City B rick a n d T ile C o.
312 Denison Bldg.
K-20
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Mason City, Iowa
35
T h e H older of a Draft
W hen a Bank Fails
By the
L egal Departm ent
N THE last few years especially, the by the draft issued by the National Bank
such moneys or credit with its correspond
holders o f drafts secured from the is is now in the hands o f a receiver of the
ing bank, that, upon presentation o f the
suing- bank, that were honored upon
Traders Bank. To pay fo r the draft thus
draft, a like sum would be paid to the
presentation, have caused the holder
purchased by the Traders Bank, from the owner o f the draft. That representation
thereof to make diligent inquiry as to
National Bank, the Traders Bank issued
the bank knew to be untrue at the time
his rights to recover the amount o f the
to the National Bank, a draft upon the o f issuing the draft and must be held to
draft from the issuing bank that has
have received the money wrongfully, and
Stockman’s Bank o f Omaha. This draft
failed and closed its doors. It is a usual
to hold it in trust fo r the person who paid
was issued on the same day as the other
custom in daily transactions in the finan
one, but was never paid, although pre it to the bank.
cial world o f today fo r a customer o f a sented.
It seems to be quite well settled that
bank to secure a draft therefrom which
the drawing and delivery o f a check or
A t the time the Traders Bank issued
is payable at a bank in one of the large
draft carries Avith it the representation
the $5,000.00 draft to the National Bank
trade centers. The draft secured, is then
drawn on the Stockman’s Bank, the Trad that the drawer has funds or credits in
many times sent to this trade center to
the bank against which it is drawn.
er’s Bank did not have funds on deposit
settle some obligation. In case, the issu with the Omaha Bank to meet this draft.
In criminal proceedings, it has been
ing bank fails and the bank on which the
held that the giving of a check is a repre
The National Bank filed a claim with
draft is drawn, does not have sufficient
sentation that the drawer has money or
the receiver o f the Traders Bank asking
funds on deposit belonging to the issuing
that it be allowed to receive as a pre credit with the bank and it is sufficient
bank and are subject to prior claims, the
to make the drawer guilty o f obtaining
ferred claim, the amount o f this draft.
holder of the draft may be
the money under false pre
placed in position to suffer a
tenses if he has no money in
the bank or credit with the
heavy loss.
A bank known as the Traders
bank, and intends to defraud.
“ If a bank sells a draft and receives therefor a
Bank in a western city was in
The signature of a bank to a
draft drawn by the applicant on a bank in which it
draft is a representation by it
financial distress. Its corre
had insufficient funds, it is entitled to preference of
to all subsequent holders o f the
spondent bank, in Chicago, was
draft that it had sufficient
the Drovers Bank and against
its claim for the amount against the receiver of the
funds on deposit with the
its account in this bank, the
applicant.
drawee to pay it and that
Traders Bank had drawn drafts
“ The drawing and delivery of a draft carries a
drawee would accept the draft
in excess o f its amount o f
representation that the drawer has funds or credits
when presented and pay it.
credit. To meet this situation,
Consequently, it is reason
the Traders Bank purchased
in drawee bank. Issuing a draft upon a bank in
able to conclude that when the
from the National Bank in the
which the drawer has insufficient funds, perpetuates
Traders Bank issued its draft
same city, a draft drawn by
a fraud on payee ban k!’’
to the National Bank, drawm on
this National Bank and pay
the Stockman’s Bank, the law
able to the Traders Bank for
holds that it thereby repre
$5,000. This draft was drawn
sented to the National Bank
by the National Bank on its
The question is whether, under this
that it had funds or credits with the
Chicago correspondent, the Riverside
Bank o f Chicago.
state o f facts, the National Bank is en
Stockman’s Bank, sufficient to meet the
call o f the draft, and that said bank
The Traders Bank immediately fo r tiled to and its claim allowed against the
receiver as a preferred claim? The first
knew or should have known that the
warded this draft so purchased to its
question fo r determination is, what is the
funds in the Stockman’s Bank were in
Chicago correspondent, the Drovers Bank
effect o f the drawing and delivering of a sufficient to meet the draft thus issued
and the draft was cleared through the
draft ? Does it carry with it any implica
clearing house on its receipt and the
against it, and by so doing, the Traders
Bank perpetuated a fraud upon the Na
Drovers Bank received the proceeds there tions, and, if so, what?
In considering this matter, a somewhat
tional Bank.
from. On the next day, after the Traders
Fraud may arise from facts and cir
Bank had received this draft from the similar situation might exist where a bank
has sold a draft to a customer when there
National Bank, a receiver was appointed
cumstances and may be presumed from
circumstances and conditions o f the
for the Traders Bank. All correspond is no funds in the correspondent bank
parties contracting. Fraud is so various
ents were immediately notified and ad upon which it is drawn at the time. When
the bank takes the money o f its customer
vised not to honor any outstanding drafts
in form, and color, that it is difficult, if
fo r the draft which is known to be worth
issued by the Traders Bank, and on such
not impossible, to confine it within the
less, and which there is no assurance
notice the Drovers Bank had on hand to
limits o f any practice definition.
the credit o f the Traders Bank, $10,333.00 would be honored when presented fo r pay
The fertility of man’s invention in de
ment, would, without doubt, be as wrong
which included the $5,000.00 received by
vising new schemes o f fraud is so great
in law as it is reprehensible in morals.
it on the draft issued by the National
that the courts have declined to define
The money given to the bank is not a de it or to define undue influence, which is
Bank. The Drovers Bank remitted to the
posit or a loan. It is received upon the
receiver o f the Traders Bank, the sum o f
one of its many varieties, reserving to
$10,333.00 so the $5,000.00 represented
implied representation that the bank had
(Continued on page 53)
I
N orthw estern B ank er
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
36
THE CAUSES OF B A N K FAILU RES
AND SOME REM EDIES
(Continued from page 13)
it is certain that no community can hope
to enjoy the benefits o f safety in banking
i f the business is organized in units so
numerous as to exceed the available supply
o f competent officers and responsible di
rectors, and with insufficient earning
power to be able to absorb inevitable losses.
Ample evidence o f the unhappy conse
quences o f excessive numbers and inade
quate size in banking is clearly to be
found in the geographical distribution o f
the failures o f the last six years.
In the three Federal Reserve districts,
o f Boston, New York, and Philadelphia,
there were but forty failures during these
years. It is an area o f 150,000 square
miles with a population o f 33,000,000, and
was served at the close o f 1926 by less than
3,300 banks (3,265). The Chicago district,
with a slightly larger area o f 190,000
square miles but with a population o f only
17,000,000 is provided with 2,000 more
banks (5,268), and had a record o f 437
failures between 1921 and 1926. Again
the Minneapolis district, it is true with
a much greater area, 414,010 square miles,
but with a population o f only 5,500,000
still had 2,780 banks in operation after
999 failures.
Comparison by states tells the same
story only the more forcibly. The 11,000,000 people o f the state o f New York with
an area o f 47,000 square miles managed
very comfortably with 1,065 banks in
1920, and there were eight failures in the
six subsequent years, while the slightly
less than 2,500,000 occupying an area o f
55.000 square miles in Iowa was served
by 1,763 banks, o f which 263 failed. North
Dakota supplies an even more extreme
example o f the over-development o f banks
and its inevitable sequel; 317 failures
among 898 banks having been established
to meet the needs o f a population o f about
650.000 on an area o f 70,000 square miles.
No community can possibly provide,
adequate resources, competent officers and
Beauty—That Endures and Attracts
Bank Interiors of Distinction—
W e W elcom e
without obligation to
you , any inquiry
you may have.
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
37
■experienced directors fo r one bank to
every 750 o f its inhabitants as in North
Dakota, or to 1,400 as in Iowa. Banking
troubles were inevitable with the advent
o f adverse conditions, and fo r the severity
o f these conditions the unwise use o f
■credit administered by an inordinate multi
plicity o f banks is in no small degree
responsible. And as may be seen from
the table on this page, the situation in •
these states was not exceptional.
Limitation of Bank Charters
A long and essential first step toward
the attainment o f safety in banking will
have been taken when the number o f
banks chartered is limited to the needs
o f the community, based upon clear recog
nition that development o f every com
munity is best served by strong banks
that employ conservative standards in the
extension o f credit.
An increase in minimum capital re
quirements would do much to hold the
number o f banks within safe limits.
When account is taken o f improved
means o f transportation and the general
advance in prices o f the last decade, a
minimum capital o f $25,000 surely, and
presumably o f $50,000, would not deprive
any community o f adequate banking fa
cilities. But capital requirements alone
are too mechanical and rigid to be made
the sole factor in the determination of
the desirable number o f banking instittuions in a locality. Needed elasticity
in the granting o f charters requires that
approval shall be made contingent upon
evidence o f a community need fo r addi
tional banking facilities.
A provision o f this character has al
ready been adopted by a number o f states,
and the most comprehensive o f these re
quirements, that, o f Wisconsin enacted in
1923, is here presented, preceded for pur
poses o f comparison by the conspicuously
inadequate provisions o f the Iowa Law.
IO W A :
‘ ‘ In co rp o ra tio n — a rtic le s— con
te n ts . S ta te b a n k s m a y be h e r e a fte r o rg a n
iz e d b y not le ss th a n five persons o f la w fu l
a g e , who sh all, p rio r to th e com m encem ent
■ of bu sin ess, sign and a ck n o w led g e a rtic le s
o f in co rp o ratio n b e fo r e some officer a u th o r
ize d to ta k e a ck n o w led g m e n ts o f deeds.
‘ ‘ Com m encem ent o f bu sin ess— c ertific a te
o f a u th o r ity .
N o such a sso cia tio n sh a ll
h a v e th e r ig h t to com m ence bu sin ess u n til
its officers or its sto ck h o ld ers sh a ll h a v e
fu rn ish e d to the su p erin ten d en t o f b a n k
in g a sw orn sta tem en t o f the paid-up c a p i
ta l, and, w hen th e said su p erin ten d en t is
sa tisfied as to th a t f a c t , he sh all issue to
such a sso cia tio n a c e rtific a te a u th o rizin g it
to com m ence bu sin ess. ’ ’
W IS C O N S IN :
“ A n y num ber o f ad u lt
person s, c itize n s o f W isco n sin , not less th an
seven nor m ore than tw en ty, desirin g to as
so c ia te fo r th e purpose o f o r g a n iz in g a
b a n k in g corp o ra tio n u nd er th is ch apter,
sh a ll m ak e a p p lica tio n to th e com m issioner
o f b a n k in g in such m anner as m a y be p re
scrib e d on a fo rm fu rn ish e d b y him. . . .
“ U pon re c e ip t o f p ro o f o f p u b lic a tio n ,
th e com m issioner o f b a n k in g sh a ll there-
An Announcement
o f Consolidation
The
C ontin en tal
and
Commercial National Bank
o f Chicago and its affiliated
state bank, the Continental
and Commercial Trust and
Savings Bank, are now con
solidated under the title,
C ontinental N a tio n a l Bank
and Trust Company o f Chicago.
This bank has capital o f 35
million dollars, surplus o f 30
million and undividedprofits
o f more than 3 m illion.
Deposits are upwards o f 500
million dollars and resources
exceed 600 million dollars
CONTINENTAL
NATIONAL BANK
& TRUST COMPANY
OF CHICAGO
C H IC A G O ’S LARGEST B A N K
N orthw estern B ank er
https://fraser.stlouisfed.org
I
Federal Reserve Bank of St. Louis
D ecem ber 1927
38
upon ascertain from the best sources of in
formation at his command, and by such in
vestigation as he may deem necessary,
whether the character, responsibility, and
general fitness of the persons named in such
application are such as to command confi
dence and to warrant the belief that the
business of the proposed corporation will
be honestly and efficiently conducted in ac
cordance with the intent and purpose of
this chapter ; and whether public conven
ience and advantage will be prompted by
allowing such bank to organize; and he
shall investigate the character and experi
ence of the proposed officers, the adequacy
of existing banking facilities, and the
need of further banking capital; the out
look for the growth and development of
the city, town, or village in which such
bank is to be located, and the surrounding
territory from which patronage would be
drawn; the methods and banking practices
of the existing bank or banks; the interest
rate which they charge to borrowers; the
character of the service which they render
the community, and the prospects for the
success of the proposed bank if efficiently
managed. Such investigatioh shall be com
pleted within 90 days from the filing in the
office o f the commissioner of banking of
proof of publication and the making of the
deposit herein required, but in the event
a majority of the applicants and the com
missioner of banking mutually agree to it,
the time may be extended an additional
period of 60 days. ”
This Wisconsin statute serves to indi
cate the variety o f considerations that
may properly be given weight in the de
termination o f community advantage
from the establishment or additional
banks. Precise tests are lacking. Judg
ments must be exercised, and it is there
fore to be presumed that little will be
accomplished through legislation o f this
character unless those entrusted with its
execution are supported by a public
opinion that clearly and permanently
recognizes the damaging consequences o f
an excessive number o f banks.
The problem is further complicated by
the presence o f two charter-granting au
thorities, the national and the state, which
may be played off one against the other
in doubtful cases by eager bank organ
izers. Both Federal and state officials
charged with the administration o f the
banking laws not unnaturally becomes
imbued with the desire that the system
o f banks under their jurisdiction shall
exhibit both absolute and relative growth.
Many banks have unquestionably been
chartered in the belief that a refusal
would be followed by a more favorable
response in the other quarter. It is
clearly not advisable that in this matter
national and state authorities should
work in a spirit o f close and friendly
cooperation, neither, except in the most
unusual instances, granting a charter that
has been refused by the other authority.
Responsibilities o f Directors
Hare you ever had occasion
to write to your city correspondent thus:
t?
I t m ig h t in te r e st y o u t o k n o w th a t sin c e w e
a d o p t e d y o u r A d v e r t i s i n g a n d N e w B u s i
n ess S e r v ic e t w o w e e k s a g o , w e h a v e s e c u r e d
c lo se to f i v e h u n d r e d n e w S a v in g s A c c o u n t s .
??
The above is quoted from a letter recently re
ceived from one o f our Mid-Western corre
spondents. This is not a mere "happenstance,”
nor is it the result o f an unusual situation. It
is merely further evidence o f the extent to
which we go to be o f real and constructive
service to our correspondents. A n inquiry ad
dressed to our Service Department will bring
detailed information on how we can assist you
to increase your business and step-up earnings.
The National B an k o f the
E ? JF®
S 3 E
• • O F
C H IC A G O
l
G
* *
Office o f New Y ork Representative, N o. 1 W all St.
Office o f Pacific Coast Representative, Citizens National Bank Bldg., Los Angeles
J o h n A . L y n c h , Chairman o f the Board
D a v i d R . F o r g a n , Vice-Chairm an
G e o r g e W o o d r u f f , Vice-Chairm an
H . E . O t t e , President
N . B. R. 1927
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
The organization o f unnecessary banks,
would be a far less easy matter, and the
management o f banks would be subjected
to more steady and effective supervision,
i f the responsibilities involved in the ac
ceptance o f the position o f director were
more generally realized. The risks that
are incurred are clearly set forth in the
following statement which has been pre
pared fo r the Commission by an experi
enced bank officer o f legal antecedents:
“ A director o f either a national or a
state bank, by accepting election as such,
assumes definite legal liabilities and what
is often more important, moral obligations,
which he cannot evade if he is to maintain
h’s self respect and position in the com
munity in which the bank is located.
“ The legal liabilities assumed by a bank
director by his act of accepting election
as such, are o f two kinds: express stat
utory liabilities imposed by the national
bank act or by the laws o f the state under
which the bank is chartered; and the
general legal liability imposed by the
common law upon every director in any
corporation for losses to the stockholders
or the creditors o f the corporation, caused
by his misconduct or negligence.
“ The first class o f legal liabilities gener
ally relate to excessive loans, wrongful
certification o f checks, investments of a
kind forbidden by law, guarantees by the
bank o f the credit o f some third person.
Their exact nature depends upon the terms
o f the law under which the bank is organ
ized.
“ The second sort o f legal liability which
no bank director can escape, is the general
liability assumed bjr every director and
every officer o f all corporations to use ordi
nary care and diligence in following the
affairs o f the corporation and seeing that
improper conditions are corrected. It is
D ecem b er 1927
i
39
more difficult to pin negligence of this sort
on a bank director in such a way as to
make him responsible financially to the de
positors than it is to convict him o f ap
proving a loan or an investment which the
bank is specifically forbidden to make.
But there are cases in which directors have
been held accountable fo r negligence in
following the affairs o f their bank and
many cases in which they have been held
responsible financially fo r their assent to
direct violations o f the act under which
the bank is organized. And fo r every
case that reaches the courts, there are a
dozen in which settlements involving the
payment o f money by directors have been
made out o f court, to avoid suit.
“ Directors o f banks are frequently, per
haps generally, asked from time to time, to
give guarantees or bonds in connection
with the bank’s business. There is no
legal obligation, o f course, for a director
to give such guarantees or bonds. Such
guarantees by directors are generally
given to secure the deposit of public
moneys in the bank. They are frequently
given on the borrowings o f the bank from
its city correspondent. The directors may
be asked to go on the official bond o f a
public official, who in return, promises to
keep public money in the bank. In any
o f such events, a failure o f the bank is
practically certain to convert the guar
antee or bond into a real liability. And
the existence o f such contingent liabilities
on the part o f directors, which become
very real and direct liabilities in the event
o f failure, is perhaps the main reason
why in case after case, directors have paid
or underwritten voluntary assessments and
contributions far in excess o f any double
liability on their stock, to keep banks open.
“ The moral obligation assumed by a di
rector o f a bank differs, o f course, from
community to community, and with the
moral standards o f the director himself. A
bank directorship in most communities is
regarded as an honor. I f the bank fails,
that honor is generally converted into a
disgrace. The community expects a bank
director, even at personal financial sacri
fice, to keep his bank from failing. This
is quite apart from any legal liability o f
the director. And in the case o f thousands
o f small banks that have suffered severe
losses, the directors have, at great personal
sacrifice, put in new money in an effort to
protect depositors and without any hope
o f recovery. The average farmer or small
town director o f country banks is entitled
to a degree o f credit for meeting the moral
obligations o f his position, that the general
public does not give him, particularly, if
his sacrifices and those o f his fellow di-
The
Investor’s Confidence
— Our
M ost Valuable A s s e t
T h e wise investor deals w ith a
house to w h ich good w ill is an
important asset. He realises that
never, know ingly, will it jeopard"
ise so great a value to make a
temporary profit.
T o earn and hold the confidence
o f investors is a great response
bility and likewise a great asset.
T o us it is invaluable.
A request for information on your
investment problems w ill bring
a quick response.
You w ill get
our best judgment, exercised in
your interest, w ithout obligation.
W.D. Hanna and Company
( S U C C E S S O R S T O H A N N A - S H R E V E S CO )
BONDS
FOR
INVESTMENT
B U R L IN G T O N , IO W A
P ioneer N ational Bank Bldg:.
W aterloo, Iowa
Federal Trust Building
Lincoln, Nebraska
The Laurel Building
Muscatine, Iowa
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
40
rectors do not eventually save the bank
from failure.”
In banking, as in other branches o f busi
ness, the character and policies o f the or
ganization will commonly be largely de
termined by some one individual, but in
banking and especially in the case o f the
smaller banks, the supervision o f an active
board o f directors is peculiarly necessary.
In many instances, the bank is by no means
the most important business interest of its
chief officers. There is consequent danger
that an undue proportion o f the funds o f
the bank may be employed in undertakings
in which officers and perhaps some o f the
directors are deeply engaged. As an effec
tive means o f enabling all directors to be
come more fully conversant with the condi
tion o f their respective banks, this Com
mission strongly recommends that the
American Bankers Association undertake
to work out model forms fo r the presenta
tion o f business at meetings o f the boards
o f directors o f the banks.
"Hew H o m e of the
State Bank of Chicago
The symbol of forty-eight years of banking
progress and an assurance of even broader
and more complete banking service in the
future. Tobeready for occupancy April, 1928
Government Supervision
A New Landmark
—on La Salle Street
Our new home— located in the center of
Chicago’s financial district— will be repre
sentative of the most modern developments
in bank architecture. Commodious banking
rooms and more comprehensive facilities will
enable the State Bank of Chicago to render a
broader service to correspondent banks. A n
invitation is extended to out-of-town bankers
to inspect our new home and to make full use
of the following departments: commercial,
credit, trust, real estate loan, bond and foreign.
H enry
A.
H au gan
L eroy
C h a ir m a n B oa rd o f D ir e c to r s
A.
G oddard
C h a ir m a n E x ec u tiv e C o m m i t te e
O scar H . H a u g a n
Vice C h a i r m a n
o f th e B o a r d
State Bank
of Chicago
A Trust Company
^^
L A SALLE A N D W A S H IN G T O N STREETS
M e m b e r F ederal R eser v e S y s te m
C
a p it a l ,
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Surplus
and
U
n d iv id e d
D ecem b er 1927
P r o f it s O
ver
$13,000,000
Restraint in granting charters together
with somewhat higher minimum capital
requirements, and more regular and care
ful supervision by directors will do much
to strengthen our unit banking system, but
by no means all that is needed to afford
adequate protection fo r the depositor.
Among the thousands o f banks, large and
small, throughout the country, wide differ
ences in the skill and competence of man
agement are inevitable. Dishonesty and
the employment o f an unduly large pro
portion o f the funds o f banks in the other
undertakings of officers and directors sub
ject the solvency o f banks o f small or o f
modest size to risks from which large
banks are practically immune. And it is
also perhaps pertinent to observe that
the qualities required to handle success
fully a small bank, where there is little
local diversity in loans and an intense de
mand fo r credit, are not more common than
the qualities that are needed in the man
agement o f much larger city institutions.
To meet these managerial elements o f
weakness in a system o f unit banking reli
ance hitherto, outside a few cities, has been
placed almost exclusively upon legislation
covering the details o f banking operations
and upon government supervision through
periodic examinations. It will not be ques
tioned that both legislation and super
vision have been necessary and service
able. It is evident, however, that they
have fallen far short of the accomplish
ment o f their primary purpose— the pre
vention o f numerous bank failui’es. While
this commission is convinced that some
thing more than government action is
needed, and that little or no advantage
can be anticipated from additional re
strictive legislation, it is at the same time
confident that unsound tendencies in
many banks would be checked under im-
41
proved methods o f supervision and a
somewhat more immediate enforcement
o f those provisions o f existing statutes
which deal with operations that under
mine the solvency o f the banks.
In reaching its conclusion that addi
tional legislation at the present time is
inadvisable, at least in the case o f the
national law and o f those o f most o f the
states, the commission has been influ
enced by three considerations. It has
noted that when allowance is made for
differences in location and size, the num
ber o f national banks that have failed,
hanks subject to the most restrictive of
our banking laws, has been relatively not
appreciably less than the nuhiber o f de
funct state institutions. Again, a widen
ing o f the range o f restrictions will ordi
narily increase the number of instances
in which determination o f a failure to
comply with the law involves the exer
cise o f judgment. Numerous situations
o f this nature breed dissatisfaction with
the statute and work against the effec
tive enforcement o f the law by adminis
trative authorities.
And, finally, it should be evident that
in any event legislation can never include
within its scope all o f the operations that
may prove disastrous to a bank. It can
only deal with large classes o f loans that
are usually undesirable. It cannot take
account o f difference in time or place, or
go very far in prescribing well-balanced
proportion between various classes of
loans and investments. Loans that may
be unwise at one time may be entirely
satisfactory at another : or for one bank
and not fo r another. Much must be left
to the discretion o f management, and the
unwise use o f this discretion cannot be
adequately checked by government super
vision which is mainly concerned with
the enforcement o f statutory require
ments. In many jurisdictions, moreover,
the salaries o f examiners as well as those
o f bank commissioners have been far
Electricity is a necessity.
The de
mand for light and power has in
creased from year to year.
Bonds of
electric light and power companies
constitute one of the stable forms of
investment.
W e recommend for Bank investment:
SAC C O U N T Y ELECTR IC CO.
First Mortgage Five Year
Bonds
Due November 1, 1932
Price 100 and accrued interest
AN IO W A ELECTRIC LIG H T AND POWER CO M PAN Y.
A FIRST M O R TG A G E ORLIGATION.
FIVE Y E A R M A T U R IT Y .
YIELD 5 .5 0 % .
Write us for descriptive circular.
QUAIL €
CI/JVD y
IJVn
BONDS FOR INVESTMENT
First National Bank Bldg.
DAVENPORT, IOWA
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
42
too meager to secure and retain men with
proper qualifications fo r the responsible
and difficult work o f bank supervision.
The better men speedily find more re
munerative employment elsewhere.
Clearing House Examinations
Recognizing the limitations o f govern
ment examinations and supervision, the
banks o f thirty-three cities, already or
ganized in clearing houses, have set up
their own system o f examination, and in
general with highly satisfactory results.
This experience serves to indicate the
large possibilities o f improvement in
banking practice that can be brought
about through associated action on the
part o f the banks themselves. For such
National Bank of Commerce
in NewYork
E sta b lis h e d 1839
«
------------------------------------------------------—
-------
Statement of Condition, October 10, 1927
RESOURCES
Loans and D iscounts.......................................
United States Securities................................
-----------
04,778,922.77
27,160,390.40
Stock o f Federal Reserve L a n k .................. . . . .
Banking F lo u s e ................................................
1.950,000 00
Other Bonds and Securities.........................
Cash in Vault and in Federal Reserve Bank. .
Due from Banks and B ankers..................... ____
Interest Accrued .............................................
110,520,838.25
43,403,806.94
Customers’ Liability under A cceptances. ------
40,930,012.36
$631,246,403.66
1
LIABILITIES
Capital...............
Surplus.....
Undivided Profits
....... $ 2 5 ,0 0 0 ,0 0 0 .0 0
.......
4 0 ,0 0 0 ,0 0 0 .0 0
4,1 9 7 ,4 5 9 .0 3
Deposits ..............................................................
Bills Payable ....................................................
Reserved for Interest, Taxes and other Purposes ...........................................................
Unearned Discount ......................................... . . . .
Liability as Acceptor, Endorser or Maker on
Acceptances and Foreign B ills ........... ------
1,090,213.64
80,900,086.36
$631,246,403.66
C h a ir m a n o f th e B o a rd
P re sid en t
JA M E S S. A L E X A N D E R
S T E V E N S O N E. W A R D
D i r e c to r s
JA M E S S. A L E X A N D E R
JO H N W . D A V IS
V A L E N T IN E P. S N Y D E R
C H A R L E S E. D U N L A P
H A R R Y B. T H A Y E R
H E N R Y W . de FO R E ST
ANGU S D. MCDONALD
JAM ES T IM PSO N
JO H N T. D O R R A N C E
GEORGE E. R O O S E V E L T
S T E V E N S O N E. W A R D
E D W A R D D. D U F F IE L D C H A R L E S B. SEGER
TH O M AS W IL L IA M S
|
associated action, however, it is not nec
essary to adopt exactly similar arrange
ments everywhere. The one essential is
definite recognition by bankers that actice participation in banking supervision
is necessary in order to furnish adequate
protection to depositors.
In the larger cities, where the clearing
house is an indispensable adjunct o f
banking, a more complete system of ex
amination and supervision can be estab
lished than is perhaps feasible elsewhere.
Through the clearing house, arrange
ments favored by a majority o f the mem
bers can be adopted. In the case o f coun
try banks, the initial dfficulty is encoun
tered that an organization for the specific
purpose o f supervision must be created,
and the burden o f additional expense pre
sents an evident further difficulty. It is
also important to note that the clearing
house system o f supervision does not in
clude within its scope all o f the banks o f
the cities in which it has been established.
Some banks are unwilling to submit
themselves to examination on account o f
the burden o f expense or for other rea
sons. In reserve bank cities little or no
pressure can be exerted to secure the ad
herence o f these banks since clearing
facilities are unfortunately available
through the reserve banks. The admis
sion o f others is withheld on account o f
their unsatisfactory condition.
The clearing house examination system
is not only initially selective; it also in
cludes the power o f expulsion from the
group if criticisms o f the examiner are
persistently unheeded. By the assumption
o f these powers o f selection and exclu
sion, the banks accepting the arrange
ment practically place themselves in the
position o f guarantors against loss to the
depositors in any bank that is a member
o f the group. I f insolvency is allowed
to involve loss to depositors, public con
fidence in the system is weakened, and its
permanence is seriously threatened.
W ith all its unquestioned merits, then,
the clearing house system o f examination
has limitations which must always inter
fere with its adoption by all o f the banks
o f the country. There are cities in which
it might now be established with every
promise o f decided advantage to the com
munity, and the system may well be con
sidered a goal ultimately to be reached
everywhere. The adoption o f the system
in any locality would, however, be most
inexpedient at a time when there were a
considerable number o f banks in a weak
condition, since exclusion o f these banks
might precipitate failures while their in
clusion would endanger the successful
working o f the plan itself.
Regional Organizations
In view o f these obstacles to the gen
eral adoption o f an additional system o f
examination o f the clearing house pat-
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
43
tern, this commission has examined al
ternative suggestions and finds large
promise in a less ambitious plan, which
would subject the banks to no apprecia
ble expense, is flexible, and involves no
implication o f a guaranty against loss to
depositors. The basic feature o f this pro
posal is the organization o f all banks,
both state and national, in regional
groups o f from fifty to one hundred
banks for the purpose o f improving and
making more effective use o f the present
system o f state and national examiners.
While there are doubtless large possibili
ties o f improvement in these examina
tions, we believe that, aside from a few
instances o f exceptionally skillful dishon
esty, and the special situation presented
by chains o f banks, successive examina
tions preceding failure have regularly
disclosed an increasingly unsatisfactory
condition. More immediate and effective
use o f the information secured through
examinations is certainly not less impor
tant than improvements in the examina
tions themselves.
To improve and make more effective
use o f the examinations, it is essential
that examiners should be assigned for a
period o f at least two to three years to
the banks o f a definite area, by the bank
ing departments o f the states, and that
reports o f examinations should be con
sidered with the directors o f the banks
before they are forwarded to the office
o f the bank commissioner. These are two
essential features o f the clearing house
examination system, and to them much of
its benefit may properly be attributed.
A permanent examiner o f the state
banks, working with the cooperation o f
the national examiners, with intimate
knowledge o f local conditions and per
sonalities, would be in position to exert
a potent influence, corrective o f unsound
banking policies.
Under this territorial organization o f
government examinations, much might
be accomplished even without a corre
sponding regional organization o f the
banks. But the benefit is small in com
parison with that which may be antici
pated if the examiner is supported by
the banks organized for this definite pur
pose. The moral support thus afforded
would be a factor o f large significance,
and perhaps initially to attempt more
would be inadvisable. The commission
believes, however, again following clear
ing house experience, that a carefully
chosen committee o f the regional organi
zation should be authorized to receive
representations from the examiner re
garding unsatisfactory conditions in a
bank that have not been corrected at his
suggestion by its officers and directors.
It is important to note the proposed
organization would not assume the re
sponsibility o f excluding or o f expelling
any bank from the association. The ex
ercise o f such power implies some meas
ure o f responsibility fo r the solvency o f
the banks, a responsibility which cannot
be too explicitly disavowed. The public
should understand that the organization
includes all banks, the weak as well as
the strong, and that its sole purpose is to
bring about a gradual but permanent im
provement in banking standards, and by
this means reduce the hazards to which
the depositor is now exposed.
The difficulties that may be anticipated
in securing general assent among the
bankers o f a locality to enter a regional
organization are by no means inconsider
able, and the commission is, therefore,
gratified to be able to report that in one
instance these difficulties have already
been surmounted. During the last few
months the banks o f eastern Nebraska
have worked out the details and com
pleted the organization o f the Fremont
Ro y a l
District Credit Clearing House Associa
tion, and it is significant to note that,
with a single exception, all o f the seventy
state banks o f the area have become
members, membership o f national banks
being temporarily deferred. An examiner
has been assigned to the territory, who
with the hearty approval o f the State
Bank Commissioner, is to cooperate with
the association to reduce losses and in
general to improve banking standards
and practice. The operation o f this pio
neer organization will he watched with
keen interest, since it may well prove to
be the beginning o f an improvement o f
vast consequence in the conduct o f bank
ing throughout the country.
Life, upon the whole, is far more pleas
urable than painful, otherwise we should
not feel pain so impatiently when it
comes.— Hunt.
U n io n
L if e
In s u r a n c e C o m p a n y
DES MOINES, IOWA
A C h r istm a s
P o lic y
Properly presented, our Juve
nile policies have a wonder
ful appeal at this time of the
year.
Royal Union agents
are suggesting Juvenile pol
icies as practical Christmas
gifts for the children. There
is available no finer exempli
fication of the Christmas
spirit. For a little boy or girl,
a policy for his or her “ very
own” is an enduring gift.
These bustling days leading
up to Christmas are finding
our agents devoting their time
almost exclusively to the sale
of our children’s policy forms.
Royal Union Life Insurance Company
Des Moines, Iowa
A. C. TUCKER, President
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
44
C U R R E N T Q U O T A T IO N S
On a representative list of HIGH GRADE RAILROAD, PUBLIC UTILITY,
INDUSTRIAL, CANADIAN and FOREIGN BONDS
Security
Bid Asked
Alabam a Pr. Co., 5s, 1951..................... 102% 103
A lberta, (C anada), 4 % s, 1956............... 99% 99%
Am er. Chain Co., 6s, 1933..................... 104% 104%
A m erican Radiator, 4% s, 1947............ 98% 98%
A m er. Roll. M ills Co., 6s, 1938............. 104% 105
A m er. Smelt, & R efg. Co., 5s, 1947.. 102% 102%
A m er. Sugar R efg. Co., 6s, 1937.......... 105% 105%
A m er. Tel. & Tel., 4s, 1929.................... 99% 99%
A m er. Tel. & Tel. Co.,
5s, 1960.1 06% 107
A m er. T obacco Co., 4s,
1951. 89% 90
A naconda Cop. Min. Co., 6s, 1953. . . .104%; 105
A ppalachian Elec. P r. Co., 5s, 1956.. 99% 99%
A ppalachion Pr. Co., 5s, 1941...............103% 103%
A rgen tine, 6s, 1958 .................................. 98% 98%
A ssociated Oil Cov 6s, 1935.................102% 103
A tch. Top. & S. F e R y „ 4 % s, 1962.. 102
102%
A tl. Coast Line R. R., 4s, 1952............. 98% 98%
A ustralia, 5s, 1955 .................................. 98% 98%
A ustrian, 7s, 1943......................................103% 103%
Baden Consol. Mun., 7s, 1951............... 95% 96
Bald. Loco. W ks., 5s, 1940.......................108% 108%
B. & O. R. R., 5s, 2000............................. 104% 104%
B. & O. R. R „ 4 % s, 1933......................... 99% 100
Batavian Pet. Co., 4 % s, 1942............... 93% 94
Bavaria, Germany, 6% s, 1945................ 93% 93%
Belgium , 6s, 1955 .................................... 99% 99%
Bell Tel. Co., Canada, 5s, 1955...............103% 103%
Bell Tel. Co., Penn., 5s, 1948.................105% 105%
Berlin, (G erm any), 6% s, 1950............. 96% 97
Berlin E. E. & Und. Rys., 6 % s, 1956.. 93% 93%
Beth. Steel Corp., 5s, 1936................... 101% 101%
B irm ingham Ry. Lt. & P r., 4 % s, 1954 96% 97
Birm ingham W . W ks., 5s, 1954........... 99% 99%
Brazil, 6% s, 1957...................................... 93% 93%
Brem en, (G erm any), 7s, 1935................ 99% 100
B rier H ill Steel Co.', 5 % s, 1942............. 104% 104%
B ritish Columbia, 4 % s, 1951............... 99% 100
Brooklyn Borough Gas, 5s, 1967.......... 102% 103
Brooklyn Edison, 5s, 1949.....................105% 105%
B rooklyn U nion Gas, 6s, 1947...............116
116%
Buenos A ires, 6% s, 1955....................... 101% 101%
Buenos Aires, Prov., 7s, 1952............... 97% 97%
B uffalo Gen. Elec. Co., 5s, 1939.......... 104% 105
Bush Term inal Bldg., 5s, 1960............ 104% 104%
Butte E lectric P r. Co., 5s, 1951.......... 103
103%
C alif. G. & E. Co., 5s, 1937...................102% 102%
C alif. Pet. Corp, 5 % s, 1938.................100% 100%
Canada, 4 % s, 1936 ..................................101% 101%
Canad. N a t’l Ry. Co., 4 % s, 1930........ 100% 100%
Canad. Pacific Rys., 4% s, 1946.......... 100
100%
Carolina Pr. & Lt. Co., 1956...............103% 103%
Cent, o f Ga. R y., 6s, 1929..................... 102% 102%
Cent, o f Ga. R y., 5s, 1945....................... 106
106%
Cent. 111. Lt. Co., 5s, 1943......................102% 103%
Cent. 111. Pub. Serv., 5s, 1956............. 98
98%
Cent. N. Y. Gas & E. Co., 5s, 1941.. 101% 102
Cent. Pacific R y., 5s, 1960........................104% 104%
Cent. Pr. & Lt. Co., 5s, 1956................ 97% 97%
C. & O. Ry. Co., 5s, 1929....................... 100% 101
C. B. & Q. R. R.
4s, 1949.................... 98% 98%
C. C. C.
& St. L. R. R ., 6s, 1929....... 102% 102%
C. C. & St. L. R. R ., 5s, 1929................. 100% 100%
C. C. & St, L. R. R., 5s, 1963................. 104% 104%
Chgo., Mem. & G ulf R. R., 5s, 1940.. 99
99%2
C., Mil. & St, P. Ry. Co., 4s, 1989___ 907s 91
104%
C. & N or. W es. R y., 4% s, 2037...........104
C. R. I. & P. R. R ., 5s, 1929...............100% 100%
Chgo. U nion Station, 4 % s, 1962...........101% 102
Chile, 6s, 1960............................................ 91% 91%
Chile Mtge. Bank of, 6% s, 1957............ 95% 95%
Cincinn. G. & E. Co., 5s, 1956.............101% 102
Cincinn. G. & E. Co., 5 % s, 1961...........104% 105
Clev. Union Term . 5s, 1973................... 104% 104%
Cologne, (G erm any), 6% s, 1950........... 94% 95
Colombia, Rep. of, 6s, 1961................... 92% 92%
Colorado Pr. Co., 5s, 1953..................... 102% 102%
Columbia Gas & Elec., 5s, 1952........... 99% 99%
Columbus Ry. Lt. & P r., 4 % s, 1957.. 95
95%
Comm onwealth Ed. Co., 4 % s, 1956.. 100% 100%
C onnecticut Lt. & Pr. Co., 4 % s, 1956.101% 101%
Cons. Gas., N. Y., 5 % s, 1945................. 107% 107%
Consol. H ydro-El. U. W urt., 7s, 1956. 95% 95%
Consumers Pr. Co., 5s, 1952................. 104% 104%
Copenhagen, (D en m ark), 5s, 1 9 5 7 .... 95% 96
Costa, R ica, 7s, 1951.................................. 95% 95%2
Cuba R ailroad, 5s, 1952......................... 97% 97%
Cudahy Pack. Co., 5s, 1946................... 99% 100
Cumberland Co. Pr. & L t,, 4 % s, 1956. 95% 96
Czechoslovak, 7 % s, 1945....................... 104% 105
Security
B id Asked
Danish Con., Mun. Loan, 5 % s, 1955.. 99% 99%
Delaware & Hudson Co., 4s, 1 9 4 3 .... 96% 96%
Denm ark, 5 % s, 1955................................101% 101%
Denmark, King, of, 6 s, 1942................. 104% 104%
Denver G. & E. Lt. Co., 5s, 1951........ 101
101%
Det. City Gas Co., 5s, 1947................... 102% 103
D etroit Edison Co., 5s, 1949................. 104% 105
D om inican Republic, 5% s, 1942........... 99% 1 0 0
Duquesne Lt. Co., 4 % s, 1967................. 99% 100
Dutch East Indies, 6 s, 1947................... 104% 105
Edison Elec. Ilium., 4 % s, 1930............. 99% 100
Elec. Pr. Corp., (G erm any), 6 % s, 1950 94% 94%
96% 96%
Finland, Rep. of, 6 s, 1945............... ..
Fla. Pr. & Lt. Co., 1st, 5s, 1954........... 96% 96%
Ft. W orth P r. & Lt. Co., 5s, 1931___ 100% 101%
France, 7s, 1949........................................ 106% 106%
General Elec. Co., 3% s, 1942............... 94% 94%
Gen. M otors A cc. Corp., 5s,1 9 2 8 .... 100
100%
General Pet. Corp., 5s, 1940............... 101% 102
Ga. & Alabam a R y., 5s, 1945............... 100% 100%
99%
Georgia P. Co., 5s, 1967........................... 99
Georgia Ry. & El. Co.,5s, 1932............. 101
101%
German, 7s, 1949...................................... 105% 105%
German Gen. A gr. Bk., 7s, 1950........... 97% 97%
German Con. Mun. Loan, 7s, 1 9 4 7 ... 96% 96%
German Ge. Elec. Co., 6 % s, 1940___ 113% 113%
Goodyear T. & R „ 5s, 1957................... 94% 94%
Grand Trunk Ry., 6 s, 1936....................109% 109%
Grt. N or. Ry. Co., 4% s, 1976................100% 100%
Great W estern P r. Co., 5s, 1946...........102% 102%
Greek G ov’t, 7s, 1964................................ 97% 97%
G u lf Oil Corp., P a., 5s, 1947................. 100% 100%
Haiti, Republic, 6 s, 1952.......................... 99% 100
Ham burg, Germany, 6 s, 1946............... 92% 93
Hershey Choc. Co., 5 % s, 1940.............102% 103
Hudson County Gas. Co., 5s, 1 9 4 9 ... 104% 105
H um ble Oil & R efg. Co., 5 % s, 1932. .102% 102%
H ungary, Kingdom , 7 % s, 1944.............101% 101%
H un gary M unicipal, 7 % s, 1945........... 98% 98^
Idaho P ow er Co., 5s, 1947.....................102
102%
111. Bell Tel. Co., 5s, 1956.....................105% 105%
111. Cent. R y., 4 % s, 1968....................... 101% 102
111. Pr. & Lt. Co., 5s, 1956................... 97% 97%
111. Steel Co., 4 % s t 1940......................... 100% 100%
Ind. M ich. Elec. Co., 5s, 1957...............103% 1033/
Ind. Pr. & Lt. Co., 5s, 1957................... 100% 100%
Inland Steel Co., 5 % s, 1945................. 103% 103%
Internat. P ap er Co., 5s, 1947.............. 100% 100%
Internat. Silver Co., 6 s, 1948.............. 108% 109
Interstate P r. Co., 5s, 1957.................... 96% 96%
Iow a Pub. Serv. Co., 5s, 1957............... 99% 99r/
Italy, 7s, 1951.........‘.................................. 97% 97%
Japanese G ov’t, 6 % s, 1954...................101% 102
Jones & Laugh. Steel, 5s, 1939............ 104% 104%
K.
C. Pr. & Lt. Co., 5s, 1952.............104% 105
K. C. Southern Ry. Co., 5s, 1950......... 102% 103
Kansas Elec. P r. Co., 5s, 1951.............101% 101%
Laclede Gas Lt. Co., 5s, 1934...............102% 102%
Lehigh V alley R. R „ 4 % s, 2003.......... 102% 102%
L ig g & Myers Tob. Co., 5s, 1 9 5 1 .... 103"% 104
L orillard Co., 5s, 1951.............................. 98% 98%
L. & N. R. R. Co., 4s, 1940.................... 98% 983/1
Louisville G. & E. Co., 5s, 1952............103% 103%
Louisville L igh ting Co., 5s, 1943..........103% 103%
Lyons, C ity of, 6 s, 1934.......................... 99% 99s/
Maine Cent, R. R., 4 % s, 1935................ 97% 97%>
M anitoba P ow er Co., 5 % s, 1951........ 103% 103%
Mass. Gas Co., 4 % s, 1931....................... 993,4 100
Mich. Cent. R. R. Co., 5s, 1931...........101
101%
Mid. Steel & Ord. Co., 5s, 1936...........100% 1003/
M ilwaukee Gas Lt. Co., 4 % s, 1 9 6 7 ... 99% 99%
Minnesota Pr. & Lt. Co., 5s, 1955___ 1023/8 102%
Minn., St. P. & S. S. M. R y., 4s, 1938 90% 90'%
Miss. Riv. P r. Co., 5s, 1951.................... 103% 1033/,
Mo., Kas. & T. R. R ., 4s, 1990.................. 92
92%
Mo. Pac. R. R., 5s, 1977...........................1013,4 101%
M ontana P ow er Co., 5s, 1943................ 103% 103%
Montevideo, (U ru gu a y), 7s, 1 9 5 2 ....1 0 3 % 104
M ontreal, (C anada), 4% s, 1946........... 99% 1 0 0 %
M orris & Co., 4 % s, 1939....................... 8 6
86%
Mutual Fuel Gas Co., 5s, 1947.............101
101%
Narragansett, Co., 5s, 1957.................1 0 1 % 101%
N ational Press B ldg., 6 s, 1959.............101% 102
N ational Tube Co., 5s, 1952................... 104% 105
Netherlands, 6 s, 1954...............................102% 103
N ew Brunswick, (C an .), 4 % s, 1936..101
101%
N ew E ng. G. & E. Co., 5s, 1947........... 983,4 99
N ew E ng. Tel. & Tel. Co.. 4 % s, 1961 100% 101
N ew foundland, 5 % s, 1942....................103% 104%
Security
Bid Asked
N.
Orleans Term. Co., 4s, 1953........ 91% 91%
New South W ales, 5s, 1958................... 95% 95%
N.
Y. Cent. Lines, 4 % s, 2013........... 104% 105
New York Edison Co., 5s, 1944...........104% 105
N ew Y ork P r. & Lt. Co., 4 % s, 1967. . 96
96%
N. Y. Tel. Co., 4 % s, 1939....................... 101% 101%
N iagara Falls Pr. Co., 5s, 1932...........102% 102%
N or. Ind., G. & E. Co., 5s, 1929...........100
100%
N or. Pac. Ry. Co., 4s, 1997................. 97% 973%
N or. States P r. Co., 5s, 1941...............1023,4 102%
N orw ay, Kingdom of, 5 % s, 1965.........100% 100%
N urem burg, City o f, 6 s, 1952............. 92%
92%
Ohio P r. Co., 5s, 1952........................... 1013,6 101%
Ohio R iv. Edison Co., 5s, 1951.............101
101%
Ontario, Prov. of, 4 % s, 1931............... 100% 100%
O ntario Pow er Co., 5s, 1943................. 102% 103
Oregon Sht. L ine R. R., 4s, 1 9 2 9 .... 99% 99%
Oslo, N orw ay, 5 % s, 1946....................... 99% 100
P a cif. Coast P r. Co., 5s, 1940............... 101% 1013,4
P acif. Gas & Elec. Co., 5s, 1955.........103% 103%
P a cif. Tel. & Tel. Co., 5s, 1952...........105% 105%
Panam a, 5 % s, 1953............................... 103% 103%
Penn. Edison Co., 5s, 1946..................... 102% 102%
Penn. R. R. Co., 5s, 1964....................... 105% 105%
Penn., Ohio & Det. R. R „ 4 % s, 1977.101% 101%
Penn. Pr. & Lt. Co., 5s, 1953............... 102% 103
Peoples Gas Lt. & Coke Co., 5s, 1947.104% 104%
P ere M arquette R y., 5s, 1956..............104% 104%
Peru, 7% s, 1956 ...................................... 103% 104
Phila. Elec. Co., (P a .), 4 % s, 1967___ 99% 99%
P illsbury F lour M ills Co., 6 s, 1943. . . .104% 105
P otom ac Edison Co., 5s, 1956............... 98% 99%
Pressed Steel C ar Co., 5s, 1933........... 98% 99
Prussia, (G erm any), 6 % s, 1951........... 96
96%
Pub. Service Co., Okla., 5s, 1 9 6 1 .... 98% 98%
Queensland, (A u stra lia), 7s, 1 9 4 1 ....1 1 4 % 114%
Republic Iron & Steel, 5s, 1940............101% 102
Rhine-W est. Elec. P r., 7s, 1950........... 99% 99%
R io Grande D o Sul, 7s, 1966................ 96% 97
R io de Janeiro, 8 s, 1947........................... 105% 105%
Rotterdam , (H ollan d), 6 s, 1964..........104% 104%
St, L „ Ir. Mt, & So. R y., 5s, 1931___ 101% 1 0 1 «^
St. Paul Gas L t. Co., 5s, 1944.............. 102% 102 %2
St. Paul U nion Stk. Yds. Co., 5s, 1946 100
100%
Salvador, 8 s, 1948................................... 108% 108%
San Joaquin Lt. & P r., 5s, 1957......... 102% 1023,4
San Paulo, C ity of, 8 s, 1952................... 111% 111%
San Paulo, State, 8 s, 1936....................... 105% 106
Saskatchewan, P rov., 5s, 1943.......... 103
103%
Sauda Falls Co., 5s, 1955.....................100
100%
Saxon Pub. W ks., 7s, 1945................... 99% 99%
Shawinigan W tr. & P r. Co., 4 % s, 1967 96
96%
Shell U nion Oil, 5s, 1947....................... 98% 98%
Sherman H otel Co., 5 % s, 1930............. 99% 100
Siemens & Halske, A . G., 7s, 1936____100% 1003,4
Sinclair Pipe, 5s, 1942........................... 93% 93%
Sixty-O ne B roadw ay B ldg., 5 % s, 1950 100
100%
S olvay Am er. Inv., 5s, 1942................... 98% 98%
So. Car. & Ga, R y., 5 % s, 1929...........101% 102
Southern Calif. Edison Co., 5s, 1951 102% 102%
So. Pac. R y., 4s, 1929........................... 99% 99%
Southern Ry. Co., 4s, 1956.................. 93% 93%
Southwest Bell Tel. 5s, 1954................105% 1053%
Stand. Oil Co., N. Y „ 4 % s, 1951___ 973% 9 7 1 %
Stand. Mill. Co., 5s, 1930........................ 1013% 1 0 1 %
Sun Oil Co., 5 % s, 1939............................ 101% 101%
Swedish G ov’t, 5 % s, 1954........................ 104% 104%
S w ift & Co., 5s, 1944............................... 102
102%
Swiss G ov’t, 5% s, 1946........................... 103% 103%
Texas Pr. & Lt. Co., 5s, 1937...............1013% 1 0 2
T oronto, Canada, 5s, 1934.....................102
102%
U nion Oil Co., C alif., 5s, 1935............. 983% 9 8 %
U nion Pac. R. R ., 4s, 1947.................... 98% 983 %
U. K. Gt. B r„ 5 % s, 1937........................ 106% 106%
U nited Steel W ks., '6 % s, 1951............... 92% 93
U ruguay, 6 s, 1960...................................... 96% 96%
U tah Lt. & Tr. Co., 5s, 1944............... 97% 97%
V a. Ry. & P r. Co., 5s, 1934.................... 101% 1 0 1 »%
W abash R y., 5s, 1975............................. 104
104%
W ard (M ontgom ery) & Co., 5s, 1946.101% 101%
W est Penn P r. Co., 5s, 1946..................103% 103»%
W estern E lectric Co., 5s, 1944..............104% 104%
W estern Md. Ry. 4s, 1952..................... 96% 96%
W estern P a cif. R. R ., 5s, 1946.......... 100
100%
W estern U nion Tel. Co., 4 % s, 195 0 ..10 0 % 100%
Westhse. Elec. & M fg. Co., 5s, 1944.. 104% 104%
W innipeg, (C anada), 4 % s, 1946......... 99% 99%
Yadkin R iver Pr. Co., 5s, 1941..............103% 103%
Youngstow n Sheet & Tube, 6 s, 1943.. 105
105%
CAMP, THORNE & CO., Inc., 29 S. LaSalle St., Chicago
M IN N E A P O L IS
ST. LO U IS
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
DES M O IN ES
D ecem b er 1927
DAVEN PORT
N EW Y O R K
LASALLE
J A N E S V IL L E
M IL W A U K E E
SA N FR AN C ISC O
45
Developing a Bank Bond Department in a
Medium Siz,ed Community
By A L F R E D H O I F E L L
Manager, Bond Department, Woodlawn Trust and Savings Bank, Chicago
Speech delivered befor i : the Investment Departmental, Tioelfth Annual Convention Financial
Advertisers Association, W est Baden, Indiana
H A T a bank in a medium size com
munity should have a Bond Depart
ment is, in my opinion, above ques
tion.
The advent o f the commercial
banker into the investment field is wel
come news to the large houses o f issue,
for they appreciate he has the confidence
o f his community and that whatever
bonds are sold in his new department will
go to the private investor. Indeed, I
would say that, ultimately, the banker
in medium size communities will take
the place now occupied by the smaller
bond houses as a retailer in his locality,
for the field is naturally h is; all it awaits
is his initiative. There is nothing un
ethical, nothing that scatters conserva
tism or banking policies to the four winds,
through adding this important depart
ment to a bank’s activities.
T
The bond business is highly specialized,
tremendous in its scope. It may be said
to be an elaboration o f the loaning de
partment o f a commercial bank. Instead,
however, it loans to nationally and inter
nationally known corporations and to
countries the world over. Its operations
make fo r growth, development, employ
ment; it brings distant countries to our
doors. To keep abreast o f the times, to
be able to define and discuss different
bonds intelligently, to render an intelli
gent and specialized service, it is neces
sary that a Bond Department be headed
by a trained bond man. I am referring
throughout to Corporation Bonds, which
so overwhelmingly constitute the invest
ment field.
Securing the Merchandise
It is next necessary to secure the mer
chandise for sale. Contacts should be
made with the large houses which syndi
cate and wholesale bonds, and in dealing
with them it is vitally necessary that
good will be builded— I mean by this a
sincere effort to place bonds with the
private investor instead o f throwing them
back on the market at a slight profit.
These houses are in position to know
when these bonds go back on the market
within a comparatively short time after
purchase, and continuation o f such prac
tice by a banker sounds the death knell
o f his Bond Department.
The Bond Department is in its infancy
when the sale is made. Its growth to
manly proportions will result from care
ful nursing by sensible service— advice
when profitable trading possibilities pre
sent themselves, when bonds are called
fo r payment prior to maturity, unbiased
analyses o f other offerings, how to make
out ownership certificates and the like.
When it comes to selling the products
o f the bond market, the commercial
banker has a tremendous advantage over
the bond house— an advantage that he
may not appreciate. The banker occupies
a peculiar position as the temporary
custodian o f the wealth o f his community.
His contact is direct, and he is voluntarily
sought fo r advice as to whether securi
ties or realty should be bought, what
his legal slant is on this or that, what
to give the baby fo r internal disorders,
why gentlemen prefer blondes, and so
on. In other words, he is the financial,
medical, legal and domestic adviser o f
his depositors. To the head o f no bond
house are such private matters brought,
and bringing them to the banker is the
highest compliment o f the esteem in
which he is held. It is no strain to
visualize what capital can be made o f
this contact in building up a bond de
partment.
Every man that comes to the railing
fo r advice concerning securities is a
very live prospect. He has the desire—
the earliest kind o f a sale. The bond
man must prescribe his diet from his
own merchandise.
Business transactions are as frequently
closed in banks as in law offices, and here
again is a prospective investor, fo r all
the purchase money isn’t going to stay
in the bank by any means.
Are Minor Advantages
A ll these, however, are minor advan
tages. The major ones stand out boldly.
A heavy bank account is always a real
prospect, fo r some time the possessor
may decide to invest on advice o f friends
and withdraw his funds. I am acquainted
with instances where, regularly in Janu
ary, and July, bond salesmen walk in
with customers savings accounts, which
are withdrawn fo r bond purchases.
It is fair to assume that every safety
deposit box holder is the possessor o f
some securities, and regular solicitation
o f these afford an excellent field for ex
ploitation.
One form o f solicitation
could be a circular letter calling atten
tion to the service which the bond de
partment can render by reviewing securi
ties free o f charge, suggesting that,
since purchase, holdings may have been
affected one way or another. Another,
suggestion is that the Bond Department
will be glad to watch one’s investments
if listed with it. In this way the De
partment at once possesses a list, o f the
investor’s holdings— an invaluable asset
— knows what kind o f securitites are pur
chased and, what is more, their due date.
The latter, o f course, is very important
because it indicates when the investor
will, o f necessity, be in the market.
When a depositor presents a bond as
collateral, the banker is immediately
placed in contact with an actual buyer
and, o f course, immediately knows what
specific bond he owns. Here is a security
holder telling you, voluntarily, what he
has. Then his acquaintance should be
fostered so that the next time he buys,
his banker may be able to fill his wants.
(Continued on page 68)
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
46
Thirtieth Year for a Kansas Bond House
Since March, 1926, when TEE NOBTEWESTEEN
BANKEE announced the opening of the Des Moines
Office of The Brown-Crummer Company, there has
been an increasing interest in this institution and in
securities of Southwestern municipalities. A visit in
their home offices at Wichita is convincing evidence
of the vast economic development which has made
their growth possible.
HE Brown-Crummer Company, o f W ichita, Kansas,
was organized in 1897 and consisted o f one man in a
single-room office in a town which had, only a few years
before, stepped out o f “ chaps” and sombrero into urban dress.
But the town and the man exemplified the spirit o f the West.
The “ wild and woolly” cattle towns o f Kansas, Nebraska,
Oklahoma and Texas were turning toward civic development
and an underwriter who had faith in their future was needed.
The infant organization had that faith and it has grown with
its beloved west.
From the single room o f thirty years ago has emerged a
national institution with offices in principal cities throughout
the country and an organization which has originated and dis
tributed hundreds o f millions in securities o f southern and
middle western municipalities. There is romance in such a
history— the romance o f a well-grounded faith.
T
L eft:
A b o v e : W arren E. B row n , P resid en t
R o y E . C rum m er, V ic e-P re sid en t and General M anager
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
BELOW :
In the B row n-C rum m er offices in W ich ita . 1. T he ca g e in the
B ond D ep artm en t. 2. O ne o f th e offices in the su ite o f five
room s occu p ied b y the L eg a l D ep artm en t. 3. The gen eral office
and com m unicating a isles.
4. A corner of the m ain lo b b y .
47
A
BondA id for
Bankers
H E banker of today must necessarily be
in close touch with investments and their
markets.
T
But most often he is too busy to devote adequate
time. T o care for his needs we have developed
an Investment Correspondent Department to sup
plement his personal services. Each month we
issue the Investment Digest with a review of
current business and investment conditions and
giving practical ideas and helps in developing an
investment service for busy bankers. If you are
not receiving the Digest send us your name.
A t all times we are able to quote and give up-todate information promptly on all outstanding issues.
Inquiries by mail, telephone or telegraph will re
ceive our immediate attention.
Bond Department
KRENN
& D A T O , Inc.
Exclusive Agent for Edith Rockefeller McCormick Trust
111 Broadway
NEW
YORK
39 So. La Salle Street
916 W aln u t Street
C H IC A G O
K AN SAS C IT Y
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
48
The Principles of Bank Investment
By
H.
C .N I C H O L S O N
V ice President P ackers National Bank, Omaha, and the P ackers National Company
F rom an address before the 53d A. B. A. C onvention
N DISCUSSING Bank Investments,
no attempt will be made to do more
than roughly outline some o f the fun
damental principles, and even these can
only be treated in a general way.
Formerly cash and strictly commercial
loans were recognized as the only good
bank assets. Today there is found in
the portfolio o f nearly every banker a
round amount o f purchased investments.
By this name, we shall know call money,
acceptances, commercial paper and bonds.
And to them, this discussion will be lim
ited. The aim is to establish them as
I
Making the Most
of Your Bank’s Reserves to
Improve Net Profit
SGovernment'S\ AIumcipalN\ Farm Loarü. ,
N these days of low interest and high operating expense,
the average bank must keep its reserves employed to
best advantage to make a fair profit. And still it must keep
liquid for any probable demand which may be made upon it.
I
That problem varies in every bank and must be worked
out differently. Some banks need to increase their earnings;
others need to improve their liquid condition.
The merit of a properly constituted bond reserve is that
it permits of either or both of these things. It serves to
offset excessive local commitments by its ready marketabil
ity and it also serves to average up income unduly depressed
by too large a primary reserve.
A properly graduated bond reserve is thus a flexible
buffer between too heavy a local commitment, on the one
hand, and too high a liquid reserve, on the other. Over a
period of years it serves|to stabilize a bank’ s income. It is
the modern way of equalizing conditions.
The value o f a bond reserve depends very much upon the experi
ence and skill with which it is constructed. For years w e have
specialized in this banking problem, working with hundreds o f
different banks, dealing with all kinds o f conditions. This enables
us to apply the experience o f a parallel situation to every case.
HAL SEY , S T U A R T & CO.
INCORPORATED
Ch i c a g o
PH ILA D E LPH IA I I I
st
. l o u is
201 S. L a Salle St.
South I^th St.
31 9 North 4 th St.
Pi t t s b u r g h
N orth w estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D E TR O IT
boston
6o
new
i
Y ork
Griswold St.
85 Devonshire St.
307 Fifth A v e .
D ecem b er 1927
Min n e a p o l is
14 W a ll St.
C LEVELAN D
M il w a u k e e
92 5 Euclid A v e .
425 East W ater St.
608 Second A v e ., S.
prudent and profitable channels for in
vestment, notwithstanding they deviate
somewhat from form er banking practice.
Recent Changes
In recent times, the position o f a com
mercial bank has undergone some change.
Ten years ago 93% o f the deposits were
payable on demand. Today more than
one-quarter are on time. Today there is
at our command the rediscount privilege
o f the Federal Reserve System. The ne
cessity fo r quick assets in such a large
ratio has passed. National legislation has
recognized the changed conditions, and
has materially reduced legal reserve re
quirements. Idle funds must go to work.
Such funds may be loaned to our worthy
borrowing customers, or they may pur
chase investment securities. The custom
er’s loan needs little comment, as it con
stitutes the primary function of banking.
The prosperity o f the bank depends upon
the good will o f its customers, and they
must be served. However, the experi
ence o f the past few years has taught
that there is safety and stability in the
diversification o f the class o f our loans
and investments. W e build up our de
fenses as weak places appear in our
financial structure. Thus has developed
the so-called secondary reserve. It is the
investment o f surplus funds in high
grade, quickly marketable bonds, and in
short time, self-liquidating paper that is
eligible fo r rediscount. Such investments
occupy a midway position— both in in
terest return and liquid character. Con
ceding something o f one virtue for bene
fit in the other. And the safety of the
investment and its stabilizing influence is
entirely compensating. The exact amount
o f this secondary reserve, and its proper
ratio to local loans, varies with geo
graphical location and seasonable condi
tions. The answer can only be obtained
by a careful analysis o f the individual
bank. It has been suggested it should at
all times at least equal the legal reserve
requirement.
Call loans, acceptances and commercial
paper have some advantages over bonds,
namely, comparative nonchalance in
making the individual selection, and rela
tive freedom from attention during the
life o f the investment. They suffer no
loss from depreciation. In call loans and
acceptances, the loss occasioned by de
fault has been negligible. The average
annual loss in commercial paper is less
than one-fiftieth o f one percent. These
49
Safe Municipal Bonds
Backed by the Faith and Credit
o f Sound, Prosperous Communities
W e own and offer for the consideration of conservative
investors the following carefully selected municipal bonds :
Security
Per Cent
Y ield A bou t
M aturity
Chicago So. Park Commissioners 4’s Aug. 1, 1944
3.90
State of Oregon, 3% ’s . .
. . Oct. 1, 1952
3.90
West Chicago Pk. Commissioners 4’s 1940-1941
3.95
State of Oregon 4’s and 41/4’s . . Apr. 8i Oct.1, 1952
3.95
City of Toledo, Ohio, 4V2’s . . 1940-1948
3.95
City of Detroit, Mich., 4’s . . . May 15, 1956
4.00
City of Detroit, Mich., 41/k’s . . 1949-1957
4.05
State of North Carolina 4V2’s . . Jan. 1, 1948
4.05
Ashtabula, Ohio, 6’s ................... Mar. 1, 1931
4.10
State of Arkansas 41/Vs . . . .
1947-1948
4.10
Langlade County, Wis., 4V2’s . . Mar. 1, 1942
4.10
City of New Orleans, La., 4’s . . July 1, 1950 Opt. ’42 4.10
City of Memphis, Tenn., 4’s . . 1947-1948
4.15
Memphis, Tenn., 4 % ’s . . . .
Sept. 1, 1934
4.15
City of Shreveport, La., 4V2’s . . 1949-1963
4.15
City of Raleigh, N. C., 41/a,s
. . 1933-1967
4.15-4.20
Berea Village Sch. Dist., Ohio, 41/a’s April 1, 1934
4.20
Harris County,Tex.,Nav.Dist.4Vk’s 1931-1946
4.20-4.30
City of Durham, N. C., 5’s . . . Jan. 1, 1940-41
4.25
Spartanburg County, S. C., 4 % ’s . 1935-1946
4.25
Henderson County, N. C., 4% ’s . 1948-1957
4.35
Moore County, N. C., 4 % ’s
. . 1952-1961
4.35
St. Petersburg, Fla., 5V2’ s .
. . Jan. 1, 1957
4.90
Descriptive Circulars Sent Upon Request
Ames, Emerich & Co.
105 South La Salle Street, Chicago
New York
Philadelphia
St. Louis
Milwaukee
Los Angeles
San Francisco
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
50
three classes o f investments will be treat
ed briefly.
Funds put on the call money market
are well protected by highly negotiable
collateral, and by their very nature are
extremely liquid. A t a 4% interest rate
they net 3.80 return.
Trade and bankers acceptances enjoy
a wide market, have sound security, are
admitted to discount by Federal Reserve
Banks within ninety days o f their ma
turity, and at present yield about 3 ^ %
discount. They are two-name paper, and
are exempt from the limitations o f the
act prohibiting national banks from loan
ing in excess o f ten per cent to any one
person or firm. They are an excellent
medium o f investment, though their mer
its are not universally appreciated.
The purchase o f commercial paper has
become sound banking practice, because
it fulfills several fundamental require
ments.
It is a safe, self-liquidating form of
short-term investment.
The return is fixed and definite and is
in the form o f discount.
It is rediscountable in the Federal Re
serve Bank.
Its face value does not fluctuate.
Records show if all commercial paper
names were purchased indiscriminately
Four Offices to Serve You
E M AIN TAIN four offices in this immediate
territory—just a few of the hundreds now
serving investing America.
W
To be of service to you is one step toward being
of service to your customers for in this territory
are thousands of investors owning securities sold
by Henry L. Doherty & Co.
They form a part of the great family of 300,000
Cities Service Investors located in every state and
38 foreign countries.
The securities offered by this organization com
bine safety, high yield and marketability— They
are ideal investments for your bank— and your
customers.
Four offices to serve you.
HENRY L. DOHERTY & CO.
D IV IS IO N A L O FFIC E S
Des M oines
318 L ib e rty B uildin g
D avenport
721 F irst N ational Bank B u ildin g
S iou x C ity
221 F rancis B uildin g
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er Í927
without credit investigation, buying
banks would have lost only 20 cents on
each $1,000.00 purchased. The commer
cial paper market has had a great devel
opment in the past twenty years. The
panic o f 1907 established such paper as
a desirable investment.
So much fo r the short-term paper.
Each class qualifies without reservation
as an excellent medium for the employ
ment o f surplus funds and in the main
tenance o f a secondary reserve.
The Ideal Investment
The ideal investment is recognized by
certain characteristics: security o f prin
cipal; equitable income return, and wide,
active marketability. It should be ac
ceptable fo r rediscount and collateral
purposes; be exempt from direct taxation
and have a good chance for appreciation.
Bonds possess these qualities in varying
degrees. Obviously they cannot exist to
a high degree in the same investment. A
bond that is thoroughly safe will not re
turn a high rate o f interest, and at the
same time have a broad market. Conse
quently, such investments should be ar
ranged so that these qualities are com
bined in proper proportion. The bond
which fulfills more o f the requirements
than any other investment security, nat
urally stand in a class by itself. It is
the obligation o f the United States gov
ernment. It typifies the utmost in safety.
It commands a broad market. It is the
only bond acceptable fo r collateral pur
poses in the Federal Reserve Banks. It
enjoys certain tax emeptions. It has
shown some remarkable price apprecia
tion in the past, and it is an easy assump
tion that the remote maturities will show
compensating appreciation in the future.
The interest return on such an oustanding type o f investment is, inevitably the
lowest o f any bond. The ideal founda
tion fo r any investment fund is the Lib
erty Bond and the Treasury Certificate.
Municipal bonds differ as do the mag
nitude o f the stars. For which reason, a
discussion o f them will necessarily be
very brief. They are generally tax ex
empt, which is their outstanding charac
teristic. Their income return will vary
inversely with their security and their
marketability.
Foreign dollar bonds enjoy some popu
larity on account of the differential in
yield between them and domestic bonds
o f comparable security. Foreign gov
ernment bonds are alike in one respect;
the bondholder enjoys no real security,
except the good faith o f the borrowing
nation. The performance o f a domestic
corporation may be enforced by legal
procedure, but against a foreign govern
ment, such remedy is not available. Two
factors then determine the credit rating
o f a nation— its will to pay and its ability
to pay. It should have a stable form o f
51
government and be likely to so continue.
It should be free from internal and ex
ternal conflict. It should balance its
budget. It should have a currency based
on a metal, preferably gold. Its debt
record should be good. Our own eco
nomic conditions since the W orld W ar
have led us into foreign investing on a
large scale. W e have changed from the
world’s greatest debtor to its leading
creditor. This new policy requires care
ful study to judge accurately the indi
vidual foreign credit position. The ob
ligations o f those countries with a good
credit record, and a prospect fo r peaceful
prosperity, constitute a bank investment
that is safe and otherwise desirable.
Corporation bonds may be divided into
three classes. Railroads, public utilities
and industrials.
Thanks to efficient management, rail
road bonds have returned to public favor.
Twenty years ago the bulk o f publicly
owned securities were rails. Financial
pyramiding, incompetent management
and other abuses did not entirely destroy
faith in the essential value o f these se
curities. Transportation is a prime ne
cessity. Railroads are permanent. They
operate on a cash basis. They show rela
tively good earnings. So, despite the
event o f many defaults and receiverships,
railroad bonds are a favorite medium for
conservative investment. This is indi
cated by the fact they are included with
governments and municipals as the per
mitted investment for trust funds in
those states whose laws are restrictive.
An analysis to determine the investment
position o f rails would take into consider
ation the capital structure; valuations;
physical condition; location and earn
ings.
Through governmental require
ment, there is sufficient available data
supplemented with frequent published
reports, to make such analysis possible;
and through recent federal legislation, in
vestors in railroad securities are afforded
an added protection. The principle o f
the transportation act o f 1920 practically
assures a fair return upon capital invest
ment.
Telephone and telegraph; gas; water;
electric light; power and traction are
the public utilities. They possess charac
teristics which make the industry a de
sirable field for investment. They provide
a service indispensable to modern living.
They are usually non-competitive. They
are on a cash basis. They are little a f
fected by commercial fluctuations. They
enjoy a remarkable stability o f business
and the trend o f their earnings is con
stantly upward.
applied to public utility bonds to deter
mine their soundness as a desirable me
dium fo r investing. The utility should
operate without competition and should
satisfactorily serve its community. It
should have a suitable franchise, which
should exceed the life o f the bond by at
least five years. The bonded debt should
not exceed one and one-half times the
capital stock nor two-thirds the property
value. The interest requirement should
be earned at least twice fo r the past five
year period. The bonds should be se
cured by senior mortgages. The issue
should be o f sufficient size to insure some
thing o f an active market. Utility bonds
which possess these underlying elements
have found much favor with discriminat
ing investors.
Industrial Bonds
Industrial bonds involve a greater ele
ment o f risk than governments, munici
pals, rails or utilities. There is a hazard
in business and there is an absence of
governmental regulation and protection.
The prudent investor will, therefore, se
lect those companies which are engaged
in industries, whose earning power is
inherently stable. He will prefer a cor
poration with a large fixed capital invest
ment compared to its funded debt. He
V
J
INSURED
FIRST
MORTGAGE
GOLD
BONDS
High Yield Bonds with Payment of
Principal and Interest Guaranteed
The trend among investors is to
the high grade 6 % first mortgage
bond— INSURED— with payment
of principal and interest guaran
teed by responsible guarantors.
134 North La Salle Street
CHICAG O, ILL.
Ó
SEND fo r full particulars of
Provident
Bonds outlined in
booklet m ailed upon request.
There are certain tests which might be
r
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
52
will choose securities based on essentials
rather than non-essentials. He will do
well to study production and commerce
fo r usually prices move upward as trade
becomes prosperous and conversely. Few
industrial corporations can demonstrate
the stability o f earning power that a good
railroad or public utility enjoys. For
which reason, the investor should include
fewer industrial in his holdings than the
other types o f bonds, and they should
compensate with a higher interest return.
There are two distinct types o f bond
investors; the one is chiefly concerned
with investing for security, the other
with investing for profit. The investor
fo r safety will choose only such bonds
as have the highest security behind them
and consequently he will take a low yield.
He will diversify his investments both as
to industries and according to their geo
graphical location. He will insist on a
ready and a broad market fo r his securi
ties, so if need be he can dispose o f his
holdings without delay. He will buy only
when he is in funds, regardless o f busi
ness cycles or trade barometers. He is
satisfied with his coupon so long as the
quality o f his bond does not decline. The
investor fo r profit, while giving full con
sideration to the question what to buy, is
also influenced by when to buy. He
knows the theory o f the business cycle,
which has been developed by learned
This is Number Five o f a series o f advertisements bearing the general title, ",Before the Age o f Electricity *
D O R O US, inconvenient, unclean, dangerous —
the kerosene lamp of other days passed into
oblivion before the efficiency and safety of its succes
sor—the electric light bulb. ^ The Age of Electricity
brought light into dark corners.
O
nu'll find much of interest
our booklet. The Ideal Instmentf which tells why
lectric Power and Light
•RnoklffT-SI.t»leas
T hompson Ross & Co.
E S T A B L IS H E D
I P 12
SECURITIES
2 0 S. La Salle St. • Bank F loor
CHICAGO
N E W V'ORK
t » „ <■„
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
6180
Telephone Randolph
SAN F R A N C IS CO
D ecem b er 1927
The present market condition shows
that bonds are higher today than any
time since 1913. Before the war, we an
nually absorbed only 2y2 billion o f the
new securities and now we take 8 billion.
There is a shortage o f new issues and it
is likely to continue. There is so much
capital fo r investment that good bond
issues are quickly over-subscribed. The
money market today has all the earmarks
o f distinct ease and gives clear promise
of remaining in that condition for some
time to come. Cheap money means high
priced bonds. Each day brings forth a
new crop o f investors with ever increas
ing purchasing powers. W e have ac
quired as a basis o f our credit a stock of
gold equal to half the world’s visible sup
ply. Each and every existing condition
promises a continued upward trend of
bond prices, subject only to minor re
actions.
In the formulation o f an investment
program, the investor might well keep in
mind certain general fundamental prin
ciples. The higher the rate, the lower the
security, is applicable to bonds as to
other types o f investment. I f large in
terest returns are required, you must
forego something o f safety or something
o f marketability, etc. Your investments
might prudently be a compromise be
tween the desire fo r income and the ne
cessity fo r other fundamental qualities.
Diversification
An Electric Power and Light Company
furnishes some needed service to every
person in a community where it operates.
All contribute, directly or indirectly, to
its growth and add to the income which
makes its bonds safe investments.
INVESTMENT
economists. He knows it consist o f four
main periods. First, steady expansion of
business;
second, prosperity;
third,
liquidation; fourth, depression. Broadly
speaking, securities begin their advance
in time o f depression and continue until
the latter part o f the period o f prosperi
ty, when the downward movement com
mences and lasts nearly through the pe
riod o f prosperity, when the downward
movement commences and lasts nearly
through the period o f liquidation. The
investor who recognizes these cycles may
profit from year to year by changing
from term bonds to short maturities and
back again, and at the same time enjoy a
high measure o f safety.
BO ST(
Don’t keep your eggs in one basket.
While diversification affords no substi
tute fo r the use o f intelligence in select
ing securities, it does, in a measure, pro
tect against the consequence o f unforseen
misfortune in business. Distribute your
commitments as to the type o f bond, the
geographical location, and the maturities.
A bond may be known by the company
it keeps. Reputable high grade invest
ment houses carry their responsibilities
to their customers very seriously. Their
advice and recommendations are entitled
to considerable weight. You must have
confidence in the opinions o f some finan
cial experts. Choose them with care.
Don’t guess when investing. Analyze
53
the relative merits o f a bond. Scratch
the surface and see just what is behind it.
Scrutinize the company’s past record ;
investigate its present management; try
to visualize its future welfare. Don’t
try to guess the exact month to buy nor
the exact month to sell. Business trends
and price swings are not confined to
single months, nor to single seasons.
Don’t try to speculate. It is entirely out
side the province o f banking.
W ithout further recapitulation, the
statement might be made that because
there is available today such an abun
dance o f vital information concerning
investments, the investor can, with rea
sonable certainty, keep his funds profita
bly and prudently employed.
“ARE WE PLAYING TOO MUCH
GOLF?”
THE HOLDER OP A DRAFT
(Continued from page 35)
themselves the liberty to deal with it
under whatever form it may present it
self. The law declares fraud may con
sist o f omissions, or commissions, in vio
lation o f some legal or equitable duty,
trust, or confidence whereby another is
injured.
It is apparent, therefore, that the
$5,000.00 in the hands of the receiver of
the Traders Bank was fraudulently pro
cured from the National Bank, and if it
were fraudulently procured, the title
never passed to the receiver, so they were
held in trust by the receiver fo r the bene
fit of the rightful owner, the First Na
tional Bank. While the funds, in one
sense, are in the hands o f the receiver—
they still rightfully belong to the Na
tional Bank— having traced the funds to
the hands o f the receiver and as the re
ceiver has no title thereto, it must follow
that the National Bank should have a
preference on its claim.
I f a bank sells a draft and receives
therefor a draft drawn by the applicant
on a bank in which it had insufficient
funds, it is entitled to preference o f its
claim for the amount against the re
ceiver o f the applicant.
The drawing and delivery of a draft
carries a representation that the drawer
has funds or credits in drawee bank. Is
suing a draft upon a bank in which the
drawer has insufficient funds perpetuates
a fraud on payee bank.
Every man admires a clever person,
especially himself.
(Continued from page 34)
while the party referred to is a great
organizer, he has even more autos, yes,
more pleasures than may be good for him
even, and he, no doubt, has his Chauffeur
to look after him, a luxury he seems will
ing to criticize in others. I am sure quite
as many o f those whom fortune favors are
distracted by wealth as he says the
farmer may be, also, and though he may
be able to “ boss and hire” his work done,
he is perhaps a load, in a certain way,
that helps to keep the farmer down.
But, with all, he has given the farmer a
new partner in the g olf addict, against
whom, however, he is just as positive.
That, o f itself, is refreshing. Then he
goes a long way from home to example a
Government that created idleness through
a charity. No farmer in this country has
ever asked fo r it. W hy not be fair, use
some thought before making charges that
cannot be made a verity without unfair
treatment ?”
Good Bonds for Ban\s
O
Agrees with California Banker
include a broad selection of
J. L. Mitchell, president o f the First
National Bank o f Sioux City, Iowa, is in
clined to agree with the sentiments ex
pressed by Mr. Giannini. He sa y s:
good bonds, foreign and domestic,
suitable for widely-varying needs.
Each issue listed is a good invest
“ W e acknowledge receipt o f the reprint
o f the article by Mr. Giannini. I read
this article with a great deal o f interest
and concur in the sentiments expressed
therein.
“ As to the particular subject o f Golf,
the way I look at it is that the majority
o f men who play golf, play too much;
and some o f those who are attentive to
business do not play enough.
“ It is especially embarrassing to those
who play little, to play with those who
play too much, and who are in practice.
“ The saying that ‘All work and no play
makes Jack a dull boy,’ might carry an
addenda that ‘All play and no work
makes poor business.’ ”
U R m onthly investment lists
ment in its class.
W e will gladly mail these offerings
each month to bankers and others
who m ay want them.
The National City Company
National City Bank Building, New York
Offices in m ore th an 50 leading cities th ro ugh ou t the world
B O N D S
1
S H O R T
T E R M
N O T E S
*
A C C E P T A N C E S
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
54
The Changing World and
Industrial Growth
tinue to keep our industries busy. They
will dance as long as they can pay or
otherwise satisfy the fiddler.
By H A R R Y M . H A R R I S
The greatest o f all factors in the pres
ent prosperity o f our wage earners is
found in the fact that the American
worker has more mechanical horsepower
at his elbow than the worker o f any other
industrial nation. It is estimated that
one mechanical horsepower properly di
rected will do the work o f eight men, and
in America we have some 9,000,000 work
ers in industry and over 30,000,000 o f de
veloped horsepower, so if we assume that
this force is properly directed, one man’s
effort in America is multiplied over
twenty-five times.
M anager D es M oines Office, Continental and Commercial Co., o f Chicago
HE total income o f the people o f
the United States from agriculture
fo r the year 1870 was larger than the
total income from other industries, manu
facturing and trade, but fo r the year 1925
total income from agriculture was re
ported as approximately $17,000,000,000, while total income from manufac-
T
turing and trade fo r the same year is es
timated at $60,000,000,000, with $5,000,000,000 added from mining; so we are
decidedly an industrial nation.
The standard o f living o f practically
the whole world has risen since the
W orld War, and people having had a
taste o f better things will, no doubt, con
Conservative Securities
NO FUNDS
A greeting often accorded the visiting In
vestment House Representative, and one that
in the light of subsequent developments, has
time and again proven to be one of the
costliest.
Some of the Most Profitable
Bond Transactions Are
Made with “No Funds”
Ask your representatives for current infor
mation, including market quotations, con
cerning your bond holdings. It may prove
profitable.
Bar tlett & G ordon
IN C O R P O R A T E D
FIRST NATIONAL BANK BUILDING
CHICAGO
FIRST WISCONSIN NATIONAL BANK BUILDING
MILWAUKEE
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Greatest Factor
W e have twice as much developed
horsepower per worker in industry as
England, and four times as much as Ja
pan. Wages in America are approxi
mately twice the English wage, and four
times the Japanese wage. Doesn’t it
strike you that there is a very logical
connection in these factors?
Germany has always been a great in
dustrial nation. Her rise as a world
power was coincident with the discovery
and development o f the steam engine,
which she applied to produce goods and
to furnish power to ships with which she
replaced the slower moving vessels, and
rapidly built up a trade with the entire
world. Germany is now rapidly develop
ing her electrical properties and rehabili
tating her shipping. Her people are in
dustrious and intelligent and will know
how to properly direct her mechanical
horsepower and thereby multiply the e f
forts o f her workers. In my judgment
that is the answer to the way she will
pay her debts and indemnities.
James A. Patten in his biographical
story, “ In the Wheat P it,” claims that
more power is expended on the task o f
turning the soil once each year than is
used in all the factories o f the country.
“ There are over eight miles o f furrow in
a single acre. It costs farmers, who
make a sound use o f mechanical power
far less to produce wheat or cotton or
corn.
W ith power on our farms a
smaller proportion o f our population is
able to produce so much food that we
have a surplus to export. In George
Washington’s day 90 per cent o f the peo
ple worked on the land. In Russia today
85 per cent are still living on the land.”
Supply and demand rule the world, and
our farm problem is bound up with our
surplus production, and Mr. Patton says
that engine power has created that sur
plus. Cheap power is revolutionizing
life in the city and country, and we must
adapt ourselves to these changing condi
tions.
It is said that a nation which is pre
dominately industrial creates and ac-
55
cumulates wealth so rapidly that it is
soon difficult to employ it all profitably
within that nation. That should mean
better prices fo r everything in America
worth possessing before
extensive in
vestments are made abroad. However,
money like water seeks its level, so we
will no doubt be picking up the bargains
in investments abroad while our own val
ues go higher. W e have already become
almost over night a great creditor nation,
and increased trade will follow our loans
to other countries if they are properly
made. Truly this is a changing world
and competition in all lines o f endeavor
w ill be increasingly keen.
“ I am, th e re fo re , p ro fo u n d ly co n vin ced
th a t the plan, as n ow ou tlin ed b y b u sin ess
men o f a ll classes, in te re ste d p rim a r ily in
th e g e n e ra l w e lfa r e and in c id e n ta lly in
profits, is th o ro u g h ly sound and p ra c tic a b le .
I f c a rrie d th ro u gh s u c c e ss fu lly i t can n ot
help b u t sta b iliz e la n d v a lu e s and re su lt in
a w id esp re a d p u rch a sin g o f la n d b y a ctu a l
la n d ow ners and w o rk ers. I t is a crim e to
see th ese w o n d e r fu lly im p ro v ed and w o n
d e r fu lly p ro d u ctiv e Io w a fa rm s sacrificed
as m a n y o f th em h a v e been. T he o n ly e x
p la n a tio n is a broken m orale o f sp irit
am on g I o w a fa rm e rs and bu sin ess men. In
m y opinion, w e w ill w a k e up v e r y sh o rtly
and re a lize our lo st o p p o rtu n ity .
re a lize th a t Io w a fa rm s h a v e v alu e. I t w ill
en cou rage those w ith in v e stm e n t fu n d s to
b u y I o w a lan d , w h ich is th e fo u n d a tio n o f
our w e a lth .”
A “Boom” Justified
r . A. O’Connor, Dubuque attorney, has
this comment to m ake:
* ‘ F o r some tim e I h a v e th o u gh t a grou p
o f 's p e c u la to r s ’ ou tside th e sta te w ould
sta r t a boom on Io w a la n d and re a lize la rg e
profits on th e ven tu re . T he situ a tio n has
been such, in m y opin ion, to j u s t if y such a
program .
“ I o w a la n d has been g o in g 'a - b e g g in ’ , ’
w ith p r a c t ic a lly no m a rk e t. T he in itia l and
b a sic in v e stm e n t w ould h a v e m ore in trin s ic
w o rth th an th e g r e a t F lo r id a m ovem en t a
fe w y e a rs ago, as w e ll as m a n y other v e n
tu res.
“ Io w a la n d is th e m ost fe r tile and p ro
d u ctiv e la n d in th e U n ite d S ta te s and can
be b o u g h t now , in th e opin ion o f m en o f
u nq uestion ed ju d g m e n t fo r $25.00 to $50.00
per a cre less th a n its re a l v a lu e. In th is
IOW A LAND BUYING- COMPANY
BEGINS WORK
(Continued from page 24)
t h a t Io w a fa rm lan d to d a y is a b e tte r in
v e stm e n t th a n in v e stm e n t bonds fo r the
reason th a t th e b e st ty p e o f bonds can n ot
p a y o v e r 3 % to 4 p er cen t on t o d a y ’ s m a r
k e t and Io w a fa rm lan d , p u rch ased a t t o
d a y ’ s p rices, w ill m ake an a b so lu te ly sa fe
in v e stm e n t w ith a m o derate ra te and the
sp e c u la tiv e chance o f an in crea se in v a lu e.
“ A s to a n y co rp o ra tio n or a n y in s t itu
tio n th a t w ili be fo rm ed to pu rch ase Io w a
fa rm land, now is the lo g ic a l tim e to form
su ch a corp o ratio n , as w ith in th e n e x t
tw e lv e m onths it lo oks as i f a d is tin c t a d
v a n ce o v e r p re sen t p rices w o u ld be m ade.
I f such a corp o ra tio n is form ed w ith a d is
tin c t purpose o n ly o f u sin g its fu n d s fo r
th e im m ed iate pu rch ase o f la n d th a t can
b e b o u g h t a t b a rg a in p rices and an a d
v a n ta g e is ta k e n im m e d ia te ly o f presen t
p rice s, th en i t should p a y good retu rn s. I ts
su ccess w ill depend e n tire ly upon the in
te llig e n t m an agem en t and pu rch ase o f th e
la n d s and o f k e e p in g its c a p ita l p ro fita b ly
em p lo yed in th a t resp ect.
‘ ‘ T h ere is no qu estion b u t w h a t b a rg a in s
can be p u rch ased and th ere is no question
b u t w h a t those b a rg a in s are b eco m in g fe w e r
each m onth, and th a t in v e stm e n ts m ade
n ow in land , i f m ade at r ig h t p rices, should
p a y good retu rn s. I f a five m illio n d o lla r
co rp o ra tio n is fo rm ed and s ta rts to p u r
chase Io w a fa rm land , th ere is no qu estion
b u t w h a t i t w ill h a v e an in flu en ce on la n d
v a lu e s in m a n y co m m u n itie s.”
Everyone Will Benefit
W . H. Brenton, Dallas Center banker,
and manager o f the Brenton farms which
include several thousand acres in Iowa
and Minnesota, says:
‘ ‘ R e fe r r in g to y o u r in q u iry re g a rd in g the
g e n e r a l e ffec t o f th e proposed Io w a F a rm
C o rp o ra tio n w h ich w ill b u y $5,000,000.00
w o rth o f la n d in Io w a , it is m y opinion
th a t th e e ffec t w ill be b e n eficial to a ll
■ classes o f bu sin ess w ith in th e sta te.
“ I t is a n otorio u s f a c t th a t in c e rta in
■ distressed com m un ities m a n y fa rm s are se ll
in g fo r p r a c tic a lly h a lf th e ir v a lu e . I t is
■ certain th a t m a n y in v e sto rs h a v e fu n d s
w h ich th e y are w illin g to p u t in to lan d i f
once th e p rice becom es sta b ilize d .
T h is
■ corporation w ill c e r ta in ly h a v e th e effect
o f e n c o u ra g in g th is class o f b u y e rs w ho are
n o w b u y in g go ve rn m e n t and m u n icip a l se
c u r itie s a t fro m 344 to 4 Per c en t y ie ld s .
“ I t is m y opin ion th a t th e fu n c tio n in g
o f th is corp o ra tio n w ill be one o f the g r e a t
e st help s th a t has come to Io w a in m an y
y e a r s . I t w ill sta b iliz e fa rm p rice s to such
a n e x te n t th a t a ll classes o f people w ill
Supplying a N ecessity
Community Water Service
Company
The
business
of
the
Community
Water
Service
Company and of its subsidiaries is based on the
sale of
a universal
necessity— water.
Regardless
of prosperity or depression, the demand for water
continues in undiminished volume, representing as
it does an extremely small obligation for each user.
The subsidiaries of the Community W ater Service
Company serve a population of 680,000 living in
well established municipalities in the East and Middle
W est— for example, Peoria, (111.), Lexington, (K y .),
and suburbs of New York City, Pittsburgh and Saint
Louis.
The nature of the business, the stability of earnings,
conservative
financing
and
the
experience
responsibility of the management make the bonds
of the Community W ater Service Company and its
subsidiaries highly desirable investments.
Inquiries
are invited regarding these attractive securities which
are now selling on a basis to yield up to 6 % .
A
P. W. CHAPMAN & CO.,INC
115 W. Adams Street
CHICAGO
42 Cedar Street
NEW YORK
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
and
D ecem b er 1927
56
opinion I concur. W h y th en should not
Io w a men p u t up a m illio n d o llars alon gsid e
o f fo u r m illio n offered ou tside th e sta te and
p u t I o w a la n d and Io w a a g a in w here she
belo n gs— as th is m ovem en t su c ce ss fu lly
com p leted w ill do— in the v e r y fo re fro n t
o f the sta te s in a g ric u ltu r e and in d u s tr y ? ”
Need Faith
The business men and bankers o f the
state must first feel the soundness and im
portance of this enterprise.
I f they are indifferent; i f they refuse to
co-operate in the movement; if they re
main doubtful about the future o f our
farm lands, what else can be expected
from the farmers and citizens o f Iowa as
a whole?
What we need is faith in the funda
mental basis o f all wealth and credit—
and faith, like charity, begins at home!
Pride meets with provocations and dis
turbances upon almost every occasion.—
Franklin.
The Stock Market
The speculation in securities is read
justing itself and, looked at broadly,
rampant speculation has been confined
to specialties and not to the whole list.
A very large number o f listed stocks are
selling at lower prices than at the first of
the year (or as low as then), and some
Illinois Local Improvement
Bonds
o f them lower than in January, 1926. As
a class, the situation in oils illustrates
this, and packing, fertilizers and textiles
have had more or less o f a bear market.
A list o f 100 reputable stocks, most of
them active stocks, published recently
by the Wall Street Journal, shows de
clines in the last 18 months o f from lQYz
to 128*4 points. Trade conditions in par
ticular groups have been responsible fo r
many o f the declines. In the present
break some stocks which did not partici
pate in the speculative upturns have held
steady and even advanced while the list
was declining. Such stocks had previously
completed their readjustment.
The present break in stock prices looks
like a corrective reaction which has been
long expected and which, on account o f
the extended speculation preceding it,
may take some little time before comple
tion is accomplished. In its final phases it
should afford new opportunities for in
vestment selection.— From The Bache Re
view.
Exempt From All Federal Income Tax
Hold Housewarming
Illinois local improvement bonds are payable from a
special tax which is levied against the property benefiting
by the improvement, constituting a tax lien that is coequal with the general taxes and prior to any first mort
gage or civil lien.
The many friends and clients o f the
First Wisconsin Company, o f Milwaukee,
joined with them in a housewarming re
cently, to celebrate the opening o f thefr
new offices on the second floor o f the
Trust Company building. These quarters
were form erly occupied by the First W is
consin Trust Company, another one o f
the three affiliated institutions which con
stitute the First Wisconsin group. It
has been entirely renovated and remade
to fit the requirements o f the personnel
and patrons o f the investment company.
The attractive lobby, the comfortable
conference rooms and roomy working
quarters have been designed to expedite
the work o f the various departments o f
this rapidly expanding organization.
Though the First Wisconsin Company
has existed as such since 1920, its pre
decessor companies have served W iscon
sin investors fo r many years. To trace
its growth, one must go back a quarter
o f a century to the day when the old
Milwaukee Trust Company, (which later
became the First Trust Company) and
the Wisconsin Trust Company operated
bond departments. Many o f the men
who were directors fo r those companies
are serving in that capacity for the First,
Wisconsin Company today.
From 1902 until 1920, the history o f
this company could be followed through
various mergers and consolidations of
bond houses, trust compajnies and
banks; then, on Jan. 17, 1920, this sig
nificant announcement appeared in the
local papers: “ The officers and directors
o f the First W isconsin National Bank
and the First W isconsin Trust Company
o f Milwaukee, Wisconsin, announce that
hereafter the investment business o f the
bond departments o f both institutions.
We own and offer subject to prior sale a choice list of
bonds of this type, among which are:
City o f H arvey
Water 6% Bonds due each December 1, 1929 to 1937
(Denominations $500, $200 and $100)
Village o f M t. Prospect
Water 6% Bonds due each November 1, 1929 to 1937
(Denominations $1000, $500, $200 and $100)
Price 100 to Y ield 6%
Less
B a n k C o n c essio n
Harvey, Illinois is one o f the largest o f the Chicago manufacturing
and residential suburbs south o f Chicago, and is located 19 miles from
the loop on the main line o f the Illinois Central Railroad. It has a
present officially estimated population o f 19,000, and is rapidly becom
ing one o f the most prominent manufacturing cities in Northern
Illinois. There are approximately 45 manufacturing industries located
there. The value o f the city property is estimated at $60,000,000, with
a general bonded debt o f less than $10,000, which is due in December
o f this year.
M t. Prospect, Illinois, with an estimated present population o f
1,500, is 7 miles from the northwest city limits o f Chicago, on the line
o f the Chicago £s? Northwestern Railroad. It is a well located suburban
community; is growing rapidly; has an adequate modern school system
and many new beautiful homes.
D e s c r ip tiv e cir c u la r w ill
231 S. LA SALLE ST.
BOSTON
be
CHICAGO
W9I
sw
sen t on re q u e st.
PHONE CENTRAL 6556
CEDAR RAPIDS
LOS ANGELES
N orthw estern Banker
D ecem b er 1927
\
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
57
the national distribution o f bond issues.
The progressiveness o f this company has
always been tempered with conservatism.
A glance at the list o f officers and di
rectors who are responsible for the a f
fairs o f this company reveals the names
o f many men outstanding in the big busi
ness o f Milwaukee. Mr. Robert W . Baird
is president o f the First Wisconsin Com
pany. Mr. Hugh W . Grove is senior
vice president. Mr. Grove was recently
elected vice president o f the Investment
Bankers Association o f America.
will be conducted by the newly organized
First Wisconsin Company.
Thus came into being the newest mem
ber o f the First Wisconsin group, which
was the outgrowth o f the consolidations
o f the First Wisconsin National and the
First National Banks, the First Trust
and the Wisconsin Trust Companies.
The First W isconsin Company is re
sponsible for the financing not only of
many Wisconsin bond issues, but is fre
quently associated with other well known
Chicago and New York underwriters in
The “ optimistic” man says might as
well sing your grief as cry it; don’t be
a “ grouch.” — James E. Newburn.
In all holiest and most unselfish love,
friendship is the purest element o f the
affection. No love in any relation of life
can be at its best if the element o f friend
ship be lacking. And no love can tran
scend, in its possibilities o f noble and en
nobling exaltation, a love that is pure
friendship.— T rumbull.
Insured Bonds Attract Investors
By J. K E N N E T H E D L I N
President Provident State Securities Co., Chicago
HERE is a marked change taking
place in the investor’s viewpoint
toward bonds, particularly from
a standpoint o f the safety o f these
securities.
Years ago, the mere fact that a
security was a bond was in itself suffi
cient evidence of its safety— bonds as
a class o f securities were generally re
garded as the most conservative and
safest o f all investments.
In recent years, industrial expan
sion and real estate promotions on a
large scale never before experienced
in American financing, together with
the effectiveness o f highly trained
bond selling organizations, have been
responsible fo r many unsatisfactory
experiences among investors who now
demand more than bonds— who de
mand bonds guaranteed safe, payment
o f principal and interest positively
assured.
This new type o f security, the in
sured bond, has made its appearance
at a psychological time when investors
more than ever before are demanding
positive safeguards o f their invested
funds. The insured bond has exactly
met this demand. Its quick acceptance
among bankers, dealers and investors has
been a natural outcome. To bankers, the
insured bond meets the exacting require
ments o f conservative investments for
their own capital and surplus and fo r re
sale to depositors. To dealers, the insured
feature supplies safeguards that estab
lishes confidence in the safety of the securi
ties, eliminating selling resistance and per
mitting dealers to establish a profitable
volume among conservative investors.
investment will be a bond with its
principal and interest guaranteed and
reinsured.
T
The investing public took quickly to
the insured bond. Insurance is universal
ly understood, accepted and appreciated
for soundness o f its principles; fo r bene
fits it confers and the safe protection it
affords. Confidence in insurance is en
J. K E N N E T H E D L I N
trenched deeply in the minds o f the pub
lic— the great insurance organizations o f
the nation by their record of performance
have well earned and fully deserve this
confidence. The public requires no edu
cation as to the safe value o f insurance
or what it insures.
Other Things Insured
Today, it is customary by almost every
one, everywhere, to insure their lives,
motor cars, homes, factories— in fact any
and everything o f any value.
It is but natural that the public should
insure their most valuable possessions—
their invested funds.
Our company has taken a leading part
in the development o f insured bonds, be
lieving that the time is not far distant
when the truly conservative and safe
This is reasonable to believe because
bonds additionally safeguarded by
insurance are not dependent upon the
insurance feature alone. Because they
must measure up to the most rigid
requirements before surety companies
will accept them fo r insurance they
must be more carefully selected than
if they were not insured.
It is also natural to expect that in
sured bonds should take the form of
first mortgage bopds— first mortgages
are one o f the oldest form s o f invest
ment known to man— first mortgages
enjoy a record o f safety not equaled
by any other security yielding an
equally attractive return.
And when to the inherent safety of
first mortgages (none o f our loans ex
ceed 60% o f the value o f the proper
ty) is supplied the additional safe
guard o f insured principal and in
terest by one or more surety com
panies accepted by the United States,
treasury as guarantors, no form of
security could possibly offer greater safe
ty. Besides the current yield o f 6% is.
most satisfactory.
The insurance safeguard is made a.L
part o f the bond— the insurance clause is.
noncancelable and it remains in full, un
changed operation safeguarding the prin
cipal and interest until the last dollar dueon the bond is paid to the bond holdersThe fact that only the choicest issues
are eligible fo r insured bonds, in addi
tion to the realization among investorsthat the necessity o f investigation o f the
insured issue is not necessary, promises
that insured bonds are certain to popu
larize themselves with those investors
who insist on thorough protection of'
principal and interest yet securities pro
viding a satisfactory yield.
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
58
The Theory and Practices of
Leasehold Bonds
By C A R R O L L S. F E L T N E R
M anager W holesale Bond D epartm ent, R obert S. Strauss & Co., Chicago
HE following is not written from
the legal point o f view, but in an
effort to set forth the theory and
practice o f leasehold real estate bond
issues in the language o f the bond dealer.
The leasehold idea as a basis fo r secu
rity is relatively new, except in a very
few localities. The leasehold method of
financing real estate construction is con
T
tinually growing in popularity and has
many points o f advantage over the more
familiar method o f mortgage loans se
cured on the fee. For this reason, we
believe, the subject is timely and worthy
o f due consideration.
Fee and Leasehold Titles
The title o f real estate may be based
(T lU f^ O R E than 2,000 banks o f the United
States purchase these notes fo r prim e,
'—S (J l
short-term investment.
Checkings available in any fin ancial center
and complete credit data on request.
upon outright ownership o f land and
buildings or it may be based upon the
right o f the use o f such property in con
sideration o f a rental. Everyone is fa
miliar with the ordinary short term lease
which covers the use o f residence prop
erty, such as homes and apartments. As
such leases generally run for a short
period, they are more a matter o f con
venience or protection than o f having
any value as they are strictly temporary.
It must, however, be conceivable to any
one that the same lease, sufficiently
lengthened, gives in effect a right to use
the property which may be practically
as desirable as owning the fee. The ma
jority o f ground leases are for 99 years,
which far exceeds the life o f any average
tenant and in fact the life o f any building
from the standpoint o f investment value.
For this reason, the right to occupy prop
erty, whether in the form o f land or
Industrial
A c c e p ta n c e
Corporation
FIN AN CIN G S T U D E B A K E R
DEALERS EXCLU SIVELY
Co l l a t e r a l T r u s t
Gol d Not es
(T H E N A T IO N A L C I T Y BANK OF N E W Y O R K , T
rustee)
E xecutive Offices
GRAYBAR
BUILDING,
C A R R O L L S. F E L T N E R
NEW
YORK
[Lexington Avenue at 43rd Street]
Com m ercial P a per Offices
NEW YORK
/
ST . LOUIS
*
D AL LA S
/
SAN FRAN CI SCO
C H IC A G O r 105 South La Salle Street
M IN N E A P O L IS
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
*
^'rst National Soo Line Building
D ecem b er 1927
building or both fo r a period o f 99 years
is fo r all general purposes, ownership.
The land in the loop section o f Chicago,
as far as land goes, is no better or prob
ably not as good from a dirt standpoint,
as thousands o f acres o f farm land in any
state. But the reason that it is so valu
able is on account o f its location. In a
99 year lease, the lessee controls and has
59
the use o f the location or the value for
99 years. So what difference does it
make whether one owns this location by
virtue o f deed or lease except fo r the
payment o f a fixed rent? The purpose
o f the foregoing is to establish the idea
that long term leasehold titles and fee
titles accomplish much and the same pur
pose, fo r the occupant o f the premises.
Advantages of Leasehold Titles
The growing tendency toward leases
rather than outright purchases in large
transfers o f real estate is based upon
practical conditions according to the
benefits o f both the owners o f the prop
erty who become the lessors, and the ten
ant, who becomes the lessee. This sub
ject is most easily appreciated when we
start from the standpoint o f the owner
o f the property.
Assume that an individual owns a valu
able piece o f vacant property which he
desires to sell fo r a million dollars. It
is sometimes difficult to find a buyer with
one million in cash to invest, and even
if such a transaction takes place, the
owner is immediately faced with a prob
lem o f reinvesting the proceeds o f this
sale. A t this point, he is approached by
a reliable real estate operator who offers
to pay him $200,000 cash and a rental for
99 years o f $40,000 a year.
The offer to pay a fixed rental fo r a long
period is usually quite attractive to the
owner for several reasons, he does not
have to seek new investment fo r the $800,000, furthermore, a sale o f the land at a
high price may involve the payment o f a
very substantial income tax, especially
if the land has materially advanced in
price from his original purchase.
It is thus evident that the owner o f the
land may be just as well off with a long
term lease on his property as he would
Emery, Peck
ÔCRockwood
Company
Investment Securities
DES MOINES
EQUITABLE BLDG.
SIOUX CITY
DAVIDSON BLDG
Market 275
Auto. 57488
/
FOREIGN BONDS
FOR BANKS
W ell selected foreign bonds have a much
merited place in your bank’s investment
structure.
Diversification can not be complete with
out this profitable type of securities being
included.
Reference to any careful survey of the
foreign market for the past five years will
show a decided investment advantage offered
by sound foreign obligations.
National banks reporting to the Federal
Reserve show combined holdings of approx
imately five hundred millions in foreign
securities.
W e maintain a special service
in foreign securities for banks.
E S T A B L I S H E D 19 10
Investm ent
1
Securities
V
Continental and Commercial
Bank Building
CHICAGO
441 Broadway
MILWAUKEE
BAKER, KELLOGG & CO., Inc.
I l l West Monroe Street
C H IC A G O
LONDON**
Telephone Randolph 0415
BUENOSAIRES
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
60
be through a direct sale, also it is im
portant to note that the party who leases
the property almost invariably does so
with the intention o f putting a building
or improvements upon it, which, o f course,
adds to its value by the amount which
goes into the improvement.
Now, consider the position o f the lessee.
This party desires the use o f the land in
order to construct a building and natur
ally prefers paying an annual rent rather
than putting up the full purchase price
in cash. The advantage o f such an ar
rangement to the lessee is obvious and
need not be elaborated, except to say that
the full amount o f cash which he has
available can be used fo r construction or
improvements.
Valuation of Leases
Before considering the method of mort
gaging ? lease and the extent o f security
for such a mortgage, it is necessary to
understand the ordinary rules for placing
valuation on leases. To illustrate this
point, go back to our original proposition
that the land under consideration is worth
one million dollars.
The lessee paid
$200,000 in cash, leaving $800,000 on
which he pays five per cent or $40,000 a
year. This would mean that his lease
was worth $200,000. Then assume that
the lessee constructs upon this property,
a building costing $2,000,000. The ordi
nary lease entitles the lessee to the use
o f the land and all improvements so that
upon the construction o f the building,
the lessee is entitled to the use o f the
property with a total value o f $3,000, in
return for the rentals which represent
the income at five per cent on only $800,000. Obviously the value o f his leasehold
interest, or “ Leasehold Estate,” as it is
generally called, is the difference between
the total value o f $3,000,000 and the
amount o f $800,000 on which he pays
rental resulting in a net value o f $2,000,000.
W e are here using a case in which the
value o f the leasehold equity lies just
in the building and the original purchase
o f $200,000 lease. It is quite possible,,
and in fact it most frequently happens,,
that the lease may have still furthervalues.
Still, assume that the rental paid on is.
the basis o f $800,000. Then suppose that
in a few years thereafter, the land in
creased to a valuation of $2,000,000 on
which there has been no increase in rent
paid the lessor. The lessee receives thefull benefit o f such increases because in
reality he is getting a million dollars,
worth o f land fo r nothing, or to express,
it differently, he has the use o f $2,000,000 worth o f property fo r the rental price
on $800,000. This condition usually ap
plies to relatively old leases; in other
words, the point that we want to bring
out is on a 99 year lease on a fixed
rental, the value o f the lessor’s interest
or fee estate cannot increase in value,
fo r any increase in value o f the land
naturally goes to the lessee, because for
all purposes, he controls and has the use
o f the property for 99 years. There
are many old leases in existence today
that are far more valuable than the fee
estate from whom they were leased.
Financing a Lease
FIDELITY MEANS-KEEPING-FAITH
M ileston es
The miles that represent a bank’s relations with its patrons are
marked with milestones of definite services. Among the impor
tant services which a progressive bank must render is impartial
advice regarding securities.
Fidelity First Mortgage 6 ^2 % Bonds adequately fill the require
ments of a well balanced investment and to many investors, are
stepping stones in their path and milestones in their progress to
financial independence. Many Fidelity Bond owners got their
start through their banker’s recommendations.
If you are not acquainted with Fidelity Bonds, our booklet, “The
House Behind the Bonds,” will serve as an admirable introduction.
Allow us to send it.
C lD E L n y
.1. BOND¿“MORTGAGECO.JL
J.U.MENTEER,Pn>i<iteni- c^o
INCORPORATED 1913
1182 New York Life Bldg., Chicago
St. Louis— Denver
I.R253
FIDELITY-GUARANTEES-EVERY-BOND,
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
A leasehold bond is a bond issued by
the lessee and secured on his leasehold
interest in the property. You can see
from the foregoing that the lease is just
as mortgageable as the real estate itself,
and that it has a value which can be
established by the method shown above,
and is just as good for collateral if prop
erly set up as the fee.
In the issuing o f a leasehold bond, the
lessee pledges his lease as security. This
having been done, he is forced with the
necessity o f making the property earn
enough to pay his charges and still show
him a profit. The value o f a leasehold
bond depends quite largely on the ratio
o f earnings levied from the property as
compared with the total charges for
rentals (usually called “ Ground Rent” ),
taxes, insurance and other expenses. You
will also appreciate that any increase in
the value o f the land, as it all goes to
the lessee, shows a much greater ratio
o f increase o f security than if the bond
covered also the fee. Another way of
putting this more plainly is to take our
original example where the lease is worth
$200,000 and the building $2,000,000 or a
total value o f $2,200,000 a 60 per cent
loan would be $1,320,000. Now suppose,
fo r example, without any bonds being
retired, the value o f the land has in
creased to $2,000,000 which ivould mean,
61
a loan o f $1,320,000 against a total valu
ation o f $3,200,000 or 41 per cent loan.
The same loan against the fee ancl build
ing which would be an original value of
$3,000,000 with a 60 per cent loan, would
be $1,800,000. I f the property increased
a million the total value would be $4,000,000 with a loan o f $1,800,000 or 45
per cent. Of course, we do not consider
it good practice to issue bonds unless a
definite amount is being paid off yearly,
out o f the earnings o f the building. You
can readily appreciate, that the ratio
would be the same in either case as the
above is set up in that manner to make
the explanation clearer.
Still another way o f putting it, take the
lease and fee exclusive o f the building.
In the first instance, the $200,000 lease
advanced to $1,200,000, or an increase of
500 per cent, while in the second $1,000,000 fee increases to $2,000,000 or only
100 per cent.
A mortgage on the fee dated later than
the lease is said to be subject to the lease,
which means that the rights o f the lessee
must be recognized, when the mortgage is
created. The security of the leasehold
bond is not effective in any way by the
existence o f such mortgage, as it has no
bearing on the leases, as in reality, such
mortgage is against the rental paid by
the lessee. You can readily see that it
makes no difference to the lessee to whom
the rent is paid as long as the terms o f
the lease cannot be changed.
W ith National Park Bank
The National Park Bank, New York,
announces the election o f Mr. James
Bruce as a vice president.
Mr. Bruce was born in Baltimore,
December, 1892. He graduated from Gil
man school in 1910 and from Princeton
University in 1914. He then took a law
course, graduating from the University
o f Maryland law school in 1916, and
served as private secretary to Thomas
Nelson Page, ambassador to Italy, 19161917.
During the war he was in the Second
Division and on the staff o f the First
Army from 1917 to 1920.
He became vice president o f the Balti
more Trust Company in 1921, remaining
there until 1926, when he became vice
president o f the International A ccept
ance Bank, Inc., NeAv York. He comes
from this position to the National Park
Bank.
Mr. Bruce expects to assume his duties
on December 15th.
Unless a bond issue measures up to these ten
standards of safety it cannot be a Robert S.
Strauss fsf Co., issue:
1 Ownership— The ownership o f the land must be
firmly established, and a Title Guaranty Co. of
repute must guarantee that the title is clear o f all
claims.
2 Owner— The owner or owners who are also the
borrowers must be persons o f good character and
financial responsibility.
3 Location— The location must be studied carefully
by experts to determine present and future value.
4 Building— The building to improve the land must
be an income producer and must be adaptable to
the location. If a construction loan, a completion
bond guaranteeing; 1— completion o f the building;
2— that the building will be free o f all mechanics
liens; 3— complete in accordance with plans and
specifications and completion date, must be fun
nished by a reputable Fidelity and Guarantee
Company.
5 A ppraisal— W elbknown, competent independent
appraisers must appraise the property and build'
mg to be erected and no first mortgage o f over
6 0 % o f a fair valuation can be made.
6 T rustee— The Trustee must be a responsible trust
company who will certify to the authenticity of
each bond.
7 A Serial Amortization— The bonds must be in
“ serial maturities;” thereby increasing the pro*
portion o f security for the investor year by year
as the mortgage is gradually reduced.
8 Income— The net income from the property must
be in excess o f the largest annual interest and
retirement requirement.
9 Sinking Fund— The borrower must pay the trustee
monthly one^twelfth o f the total annual fixed
charges o f the issue.
1 0 Insurance— The property securing a bond issue
must be thoroughly protected by insurance from
destruction by the elements.
Current list of sound securities yield'
ing 6 % —
sent upon request
RobertS.Stmrss &Co.
All great discoveries are made by men
whose feelings run ahead o f their think
ing.— Parkhurst.
Friendship is the great chain o f human
society.— Howell.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
62
The Work-and-Save Bond as a
Supplement to Savings
By C. C. C H I L D S
Vice President, The T oy N ational Bank, Sioux City, Iowa
Speech delivered, before the Savings Departmental Session, Twelfth Annual Convention of the
Financial Advertisers Association, W est Baden, Indiana
IRST, let its understand the W ork
and Save Bond, its origin and its
possibilities. The W ork and Save
Bond is the child o f the brain o f Mr.
F
Franz Shenkberg, vice president o f the
Toy National Bank and the Farmers Loan
and Trust Company, affiliated institutions
in Sioux City, Iowa, hence, the name,
B RO KA W
AND
10$'
South
COM PAN Y
La S a l l e
Street,
Chicago
Direct Wire to Edward B. Sm ith & Co.
New York
:
Philadelphia
General Trading- Department
Specializing in Packing House,
Canadian, Equipment T r u s t
and Pacific Coast Securities.
Special Bond Service to Banks
IOWA REPRESENTATIVES
Edward J. Kelly and Maurice F. Leahy
Shenkberg’s W ork and Save Bonds. It
not only derives its name from this Mr.
Shenkberg but also from his father, Mr.
C. Shenkberg, a prominent wholesale
grocer in that city fo r many years, now
deceased. Mr. Shenkberg’s plan was to
offer to the laboring, business and pro
fessional classes an investment oppor
tunity which could be adapted to the
needs o f all. He believed that the small
saver or investor was entitled to a rate
o f interest better than that which the
savings department paid in the event
that the money be left undisturbed for a
longer period o f time. This bond is issued
fo r a five-year period with a semi-annual
interest coupon attached, is nonnegotiable, and is offered in various denomina
tions, the smallest $5.00 and the largest
$1,000.00, with several intermediates, so
no matter what amount is desired, de
nominations are available w’hich can be
adapted to meet the particular investment
ability o f the customer.
As to the possibilities, it was thought
by our executive officers that the W ork
and Save Bond could never be made very
popular because o f the comparatively
low rate paid upon it. W e also thought
that if it did become popular it would
work a severe hardship on our regular
savings department. But this, apparently, is not the case, for the plan has
not only become popular, but has, to all
appearances, proved no detriment to our
regular savings. Perhaps it has proved
a stimulant.
W ho knows ? A t least
since the institution o f the bond plan,
our savings deposits and increases have
kept pace with those o f other similar
institutions, which shows that the ama
teur investor appreciates an intermediate
depository fo r his surplus funds no mat
ter how small the amount may be. Inter
mediate because the W ork and Save
Bond takes its place between the savings
account and the usual securities offered
by our investment department. And we
call these investors amateurs because
that class which is interested and will
buy the W ork and Save Bond is, as a
rule, inexperienced in handling invest
ments.
Does Thrift “ Satisfy” ?
The emphasis, the accent, o f our sav
ings advertising has been based upon
“ Thrift,” which is as it should be, and
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
63
well enough up to a certain point, but
does it satisfy the savings depositor that
he is, in fact, thrifty because he has a
savings account? I question whether
or not it does. There seems to be a con
notation about the term thrift that causes
the small investor to feel poverty
stricken. The fact that, to get ahead, he
must place his surplus into a savings
account makes him feel diminutive. He
wishes to be an investor, to be in a posi
tion to buy securities which heretofore,
with us, has been impossible except by the
installment plan, or by building a savings
account for the purpose, as the ordinary
bonds are in denominations usually so
large as to discourage the average indi
vidual. Here the W ork and Save Bond
coincides with his desire, fo r while it can
be obtained in a denomination within
his means, it still has the dignity o f an
investment.
It has become the custom o f savings
depositors, and they are being so edu
cated, to “ Save to Spend.” There seems,
now, to be but little thought o f the sav
ings account as a means o f accumulating
a competence or as an investment. As
Mr. Arthur D. W elton says in his recent
article, “ The Changing Style o f S aving:”
“ The new generation does not subscribe
to the old custom o f accumulating, and
the bankers, obedient to the decree o f
fashion, now urge their banks as safe and
convenient places fo r the accumulation
o f money which is being gathered fo r a
definite purpose.”
Again, the satisfaction derived from
clipping the coupons semi-annually from
a W ork and Save Bond gives as much
pleasure to its possessor as a similar act
gives to the opulent. As Mr. Shenkberg
puts it, “ It is like the itch— feels so good
to scratch.” The W ork and Save Bond
combines two usually adverse character
istics, in that it is an investment fo r sur
plus funds in something not subject to
market fluctuations, but it still possesses
a usually immediate market. This market
is made by our bank, in that W ork and
Save Bonds are cashed at the savings or
certificate interest rate before maturity.
It need not be said that human nature
is materialistic; that is demonstrated in
every human endeavor. It believes only
what it sees and comes in contact with.
The purchase o f securities on the in
stallment plan has proved, from our ex
perience, and I think from the experience
o f others, to be inconceivable to the aver
age individual. He will buy a piece o f
furniture, a radio, a piano, or an auto
mobile upon installments because they
are tangible. He can see them, feel them,
use them, but to every week or month sink
Conservative and
Reliable
Offerings for
Bank
Investment
Municipal
Government
Railroad
Industrial
Public Utility
Institutional
Foreign
BONDS
Harry H.Po
l k
Co.
IN C O R P O R A T E Z D
Investment Securities
Des Moines, Iowa
P.
M.
6" Banker
TRIBUNE TOWER
R E E D
Associates
Equitable Building
Phone W alnut 55, 56, 57
C H IC A G O
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
64
Financing
Automobile
Sales
-------
—
-----
■■
==■
T 3 h e Iowa Guarantee
Mortgage Corporation
issues Collateral Gold
Notes, backed by ample
security, based on auto
m o b ile sales. T h e se
bonds have an ample
yield, are o f short ma
turity and are an ideal
investment for banks.
■
=
I
■fAgjg.y«
JULIUS D. ADELMAN, President
lo r n Guarantee
M ortgage Corporation
S H O P S B U IL D IN G
S h o p s B u ild in g
DES
N orth w estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
M O IN E S,
D ecem b er 1927
I O W A
his surplus into an intangible, invisible
something is beyond his comprehension.
The W ork and Save Bond has combined
tangibility with a price so small that it
need not exceed the average installment
payment.
Further, as to its acceptability, the
W ork and Save Bond is to the small or
inexperienced investor what an attractive
carton is to a purchaser of consumable
goods.
The attractiveness o f staple
groceries, fo r instance, is due not to
their intrinsic value but to their skillful
packaging. The W ork and Save Bond
may be likened to a consumption article.
It is attractive in denomination, in con
venience, in redemption and in appear
ance.
Something Lacking
It is difficult to market an ugly article,
no matter what its intrinsic worth or
value may be. Therefore, the savings
account and the installment receipt are
not so easily sold. What man, woman or
child o f ordinary vision sees any great,
enduring possibilities or derives such
satisfaction from the figures in a pass
book ? There is something lacking in the
transaction; the book does not even rep
resent value; it is merely a memorandum.
The bond has value as a piece o f paper
money is valuable— it actually stands
fo r the money.
A few moments ago I spoke o f the
possibilities o f the W ork and Save Bond.
I should go farther by saying that we
do not really know what the possibilities
are. We are practically allowed to do
its own advertising. Not only lias it
done that, but we think it has furnished
considerable publicity generally for regu
lar savings deposits and other depart
ments because o f its circulation and the
additional traffic it has made. Surely,
every W ork and Save Bond buyer is a
potential customer for a savings account,
and, also, fo r a safety box. He buys the
W ork and Save Bond as an investment
so he needs a savings account in which
to gather funds fo r some other purpose,
and now that he is an investor, he should
have a safe place to keep his investments
and a handy room in which to clip the
interest coupons. W e see this demon
strated nearly every day in our institu
tion. It is my opinion that the possi
bilities o f the W ork and Save Bond have
scarcely been touched. It requires but
little vision to imagine its future. As
before stated, it has, to a large extent,
been allowed to advertise itself, resting
almost solely upon its merits and praised
only by satisfied holders. So far as our
institution is concerned, I believe that an
extensive campaign in any good advertis
ing medium would double the amount
outstanding in a short period o f time.
There are many correlations which have
heretofore not been realized. The idea
o f accumulation o f savings for the pur-
65
chase o f W ork and Save Bonds could be,
I think, very effectively incorporated in
advertising copy.
The education of
school children as investors is another
thought. There are several others but
each economic division o f the country will
suggest its own.
There is no question in my mind but
wdiat the W ork and Save Bond has its
particular place in connection with the
business o f every bank that has savings
accounts o f any consequence. It can be
successfidly sold to so many different
classes o f people and to the many types
in the various classes, that it is without
doubt, the package with which to supple
ment savings.
It is attractive to the individual who has
the urge to accumulate; to the saver who
wants the higher rate o f interest and is
willing to leave the funds undisturbed for
the longer period to obtain the additional
rate; to the savings customer who feels
that he should have some graduate work in
accumulating; to the thrifty man who
does not have the gambling instinct de
veloped to make him seek speculative in
vestments o f any kin d; to the investor who
will acept the lower rate because he is in
experienced and knows it; and even to the
habitual installment buyer it is attractive,
because he gets a bond every time he pays
without the aroma of the “ dead horse”
that he is accustomed to, but which he
has learned to so dislike.
I hope I have demonstrated in this brief
address that the W ork and Save Bond
is a supplement to savings; that it is to
savings what the term implies, “ that
which serves to complete or make perfect
that to which it is added.”
Receives Honor at Yale
W ord has been received in Des Moines
that Harry H. Harris, Jr., is one o f two
Iowa boys at Yale University to be
ranked as a “ scholar o f high rank” wdth
a general average o f 85-89. He is a son
o f Harry M. Harris, manager o f the Des
Moines office o f the Continental and Com
mercial Company o f Chicago. Young
Harris is a sophomore in the university
and a member o f the naval unit there.
Fixing the Blame
There was a fearful crash as the train
struck the car. A few seconds later Mr.
and Mrs. Pickens crawded out o f the
wreckage.
Mrs. Pickens opened her
mouth to say something, but her husband
stopped her.
“ Never mind talking!” he snapped. “ I
got my end o f the car across. You were
driving the back seat and if you let it get
hit it’s no fault o f m ine!”
Bonds That “ Fit”
If you buy a new suit of clothes,
you don’t buy simply because the
material is good. You require that
the style and fit are correct for your
purposes.
The same idea is entirely appli
cable to bond purchases. Because a
bond has strong security, it does not
necessarily fit for your purposes at
the time of purchase.
We offer our assistance for the
“ fitting.”
The Cummins & Morrison Company
INVESTMENT SECURITIES
503-4 Equitable Building
Des Moines, Iowa
IOWA—
Fortunate Commonwealth!
Wealth springs from the soil. Wealth has come to Iowa this
year because it has produced a n o th e r great crop.
It is a fortunate commonwealth that can claim for its own this
great stretch of fertile territory.
But it should not be forgotten that the farm mortgage banker
has made possible the great development of farming areas!
In Iowa the Stanley-Henderson Company possesses an enviable
record for service to the farming industry and to banks who, in
their mortgage financing, appreciate prompt closings, reason
able rates, with personal interest added to satisfying service.
W e will gladly serve Y O U .
Stanley-Henderson Co., Inc.
I. C. STANLEY, President
Farm Mortgage Bankers
CEDAR RAPIDS
There is no solemnity so deep, to a
right-thinking creature, as that o f dawn.
— Ruskin.
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
66
Q uestionable Stock Certificates
H elp U nscrupulous P rom oter
Certificates o f stock in questionable
enterprises, but closely resembling bona
fide stock certificates were revealed as
the favoriate tools o f promoters when the
results o f a survey by the financial sec
tion o f the National Better Business Bu
reau into current promotional trends
were made public recently.
Based upon 553 inquiries which came
to the Bureau from individuals in all
sections o f the country regarding hun
dreds o f companies, the survey extended
over the period o f three and one-half
months from May 1 to August 15 o f this
year. The inquiries were made by or
ganizations and individuals o f widely
varying interests including school teach
ers, local Better Business Bureaus, news-
papers, chambers o f commerce, stock ex
change members, and wage earners.
Among the findings o f the survey are
the follow ing: Offerings by principals
occur four times as often as those by
brokers or other agents; mining promo
tions are most popular among operators
with oil production and real estate offers
coming second and third; the mails a f
ford the chief avenue o f approach to the
prospective customer; 30 per cent o f all
promotional offerings are sold to a re
stricted group o f which stockhloders in
previous duds and the inveterate pur
chaser o f questionable stocks, business
firms, and subscribers to doubtful publi
cations and financial services each make
up 10 per cent, and the city dweller is
better informed as to the sources o f re
liable information on current promotions
than is the rural investor.
Interesting sidelights on the survey
MUNICIPAL BONDS
Are Highly Desirable
for Bank Investments
W e offer a superior service to banks desiring
conservative paper, through our specialization in
the municipal bond field. Write today for de
scriptive circulars.
Ca r l e t o i v
D .B e h
C o .
In v e stm e n t Securities
Liberty Building
Des Moines, Iowa
Fischers M adison-A ppleton Theatres Co.
Guaranteed as to Principal and Interest by
F IS C H E R S P A R A M O U N T T H E A T R E S , IN C .
First M ortgage 6 %
Gold
Notes
D ated O ctob er
O ctober
1
1,
1927
, 1929-1930
Priced to Yield 6 %
H E S E notes are secured b y a closed first
m ortgage on three valuable sites— tw o in
V J M adison and one in A ppleton, W isco n sin
— and the three com p leted and su ccess
fu lly operated theatres thereon, in clu d in g all per
m anent fixtures owned by the Company. T he fair
cash m arket value o f these properties, as inde
pendently appraised b y the M anu factu rers’ A p
praisal Company, is over 210 per cent o f these first
m ortgage notes. T he p rincip al and interest of this
issue are, furtherm ore, u n con d ition ally guaranteed
b y Fischers Param ount T heatres, Inc., con trollin g
a chain of eleven theatres in the states o f W is c o n
sin and I llin o is . E arnings o f the guarantor co m
pany average 5.44 tim es m axim um interest re
quirem ents on these first m ortgage notes.
^I
In q u ir ie s I n v it e d
E. H. OTTM AN & COMPANY,
Bankers B u ild in g
C H IC A G O
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
In c .
IN V E S T M E N T BAN K ERS
105 W . A dam s Street
D ecem b er 1927
are that ten times as many inquiries were
made on stocks as on bonds, while mis
cellaneous offerings, inclusive o f real es
tate, were nearly as common as the sale
o f stocks. Pour times as many inquiries
were addressed to the National Bureau
by city residents as by dwellers in the
country.
As percentages o f the total number o f
inquiries the eight leading types o f pro
motional offerings as indicated by the
survey are listed below.
M in in g ......................................... 20 %
Oil production............................12y2%
Real estate................................... 10 %
General securities d e a l e r s
mostly mail “ put and call”
and installment plan spe
cialists ..................................8 1 /3 %
Oil royalty.................................. 7 %
Manufacturing ......................... 7 %
Business service firms............
Automotive ............................... 2y2%
Presenting tangible evidence o f the ac
tivities and methods o f promoters, the
survey is o f added value because its scope
was nation wide. High pressure promo
ters, it is shown, use such up-to-date sell
ing stimulants as the radio, sky writing,
elaborately faked industrial exhibits,
typster sheets, and gaudy direct-by-mail
advertising. But the fact that newspapers
have found caution necessary doubtless
accounts fo r the lack o f questionable pro
motion advertising in their columns.
All things considered, however, it has
not been necessary fo r the promoter to
call upon his ingenuity to any extent in
finding new fields in which he may issue
fake stock certificates.
Gas Industry Still Developing
W ith the vast development o f the
electric light and power industry in re
cent years, the idea has grown in the
minds o f some that the gas industry
must, perforce, have entered a period o f
decline. Much o f the work now accom
plished by electricity was form erly con
sidered a field fo r the use o f gas. The
greater publicity which has been given
electric light and power development has,
perhaps, caused many to lose sight of
progress in the manufacture, distribu
tion and sale o f the older utility prod
uct. During the past twenty years con
sumption o f manufactured gas has in
creased four-fold, and the use o f natural
gas reserves has shown a similar rate o f
increase.
Natural gas projects usually are lim
ited to a territory within about 300 miles
o f the gas fields, and although today
about three times as much natural gas as
manufactured gas is consumed, the indus
try does not touch closely the whole
population o f the country. Investments
in this division o f the gas industry are
also usually dependent fo r their ultimate
67
security on the permanence o f a single
producing field, or section o f the country.
It would seem therefore that the impor
tant developments o f the future, affecting
the largest population centers, will be in
the manufactured gas industry. W hat is
the prospect here ?
Subject to Same Economic Laws
The economic factors governing the
manufactured gas industry are fo r the
most part identical with those found in
the electric utility held. It may be ex
pected that their development will be
similar. The outstanding characteristic
o f electric utility development has, al
most from the first, been consolidation.
As yet this has not been as dominant an
influence in gas. Among several reasons
for this, a primary one is the fact that
economies derived from large scale pro
duction o f gas are not nearly so large as
those obtained by increasing the size of
electric plants. In fact, in gas produc
tion labor cost is the major operating
expense that can be reduced. The origi
nal capital investment per unit produced
is substantially less in the large plant
than in the small. As the capacity o f a
small plant becomes taxed it is the ten
dency to make additions to some larger
plant nearby which is designed eventual
ly to serve the entire surrounding terri
tory. It is therefore usually not profitable
to dismantle small plants which, how
ever, might not have been built in the
light o f present day methods. This con
dition has not retarded development in
the thickly populated districts. • Here
large scale production and distribution
have been secured with a resulting saving
in labor costs, and, more important, a
better serving o f customers.
Mine-Mouth G-as Production
Problematical
This has led some to suggest that with
modern methods o f high pressure trans
mission o f gas it may become feasible to
construct gas plants at the mouths o f coal
mines and thus save hauling charges on
the coal used. One would hesitate to
say that this was forever impossible.
Certain objections present themselves
which make it seem more a horizon pos
sibility than a project o f the near future.
To mention only a few ; although coal is
widely distributed throughout Illinois,
for instance, it is not o f a character
particularly adapted fo r the manufacture
o f gas. It is actually cheaper to import
coal from W est Virginia fo r Chicago’s
gas needs. When gas is made from coal
(which is the cheapest method o f artifi
cial production) numerous bulky by
products result, the market fo r which is
generally in the city.
Transportation
charges become necessary after all. Minemouth production o f gas may be eco
nomically possible some day. However,
T he D etroit C om pany
Affiliated with
D etroit T rust Co m p a n y
W e own and offer subject to prior sale
and change in price:
Due
Yield
St. Louis, Missouri
improvement
. . . 4’s
1932-47 3.80-3.85%
Pittsburgh, Pa.
improvement
. . . 4 % ’s 1940-47
3.85%
State of Mississippi
Hospital . . . . . . 4 K ’s 1942/32
4.00%
Detroit, Michigan
improvement
. . . 4 H ’s 1937-57
4.05%
Harris County, Texas
Navigation Dist. . . 4H ’s 1934-57 4.25-4.30%
Sampson Countv, N. C.
School
5’s
1932-57 4.25-4.35%
137 South LaSalle Street
C H I C A G O
Attractive
Utility Bonds
Rate
Yield
about
Due
Consol. Tel. of Wisconsin Ist .■
•
5ès 1942
5-75%
W est Texas Utilities Co. Ist .
.
5s
1957
5.15%
Southwest Utility Ice Co. Ist . . 6s
1941
6.25%
. . 6s
1942
6.25%
Electric Public Utilities Co.
Circulars on Request
f fo A G L A N D , A L L U M
(o .
IN C O R P O R A T E D
14 S. La Salle S t
C H IC A G O
34 Pine St.
N E W YORK
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
68
gas engineers feel that there are other
opportunities fo r developments o f more
immediate benefit to consumers and in
vestors in the industry.
More Gas for Each Consumer
otrongly Safeguarded Investment Trusts
The United States Shares Corporation manages five investment trusts. In
each the underlying securities are deposited with a bank which acts as
trustee. The trustee collects the income on the underlying securities and
twice each year pays, as dividends, the accumulated distributable income to
the shareholders.
Every security in the portfolios of these various trusts is readily marketable
and pays income regularly. Substitutions may be made to maintain high
quality, but are restricted by rigid trust agreements.
i
C ir c u la r U .-7 5
U n ited States Shares C o rp o ra tio n
t
I*» V -M
on R equ est
OlO-*-!vr*'«r-1-’
-9
-i#
^
Sh
Pu
-^ r
T
o r t
b l ic
N
U
Keystone Telephone Co.
of Philadelphia
3-Year 5% Gold Notes
Due Oct. 1, 1930; yielding
erm
t il it y
5.70%
o tes
Federated Utilities, Inc.
3-Year 5
Gol d Noies
Due Nov. 1, 1930; yielding
W e offer limited amounts
of these short term public
utility securities which
we believe should be o f
interest to banks and in
stitutions at this time.
Circulars will be sent
upon request.
5.90%
Developments the Future May Witness
Southern United Gas Co.
2-Year 5
Gol d Notes
Due April 1, 1929; yielding
6.05%
United Public Service Co.
2-Year 6% Gold Notes
Due April 1,1929; yielding
6.20%
<
D
e
W
olf
&
C
o m pa n y
,
in c
.
Investment Bonds - Established 1889
C H IC A G O
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
M IL W A U K E E
D ecem b er 1927
Stated simply, the problem o f the gas
company, like that o f the electric utility,
is to increase the consumption per meter.
This does not mean that the two servcies
are in direct competition. There is a
natural line o f cleavage, and the dis
covery o f what functions each is best
suited to perform will leave vast fields
o f development open for both. Of pri
mary importance in increasing the rev
enue load per meter is an improved rate
structure which will give fair considera
tion to the value o f each class o f service
to the company. House heating, fo r in
stance, increases volume materially, but
at the same time results in a varying
seasonal and hourly demand. It has been
found that this class o f service can be
taken on to the extent o f 40% o f total
sales, with a steady improvement in the
hourly load factor. Complementary de
mands may be developed in water heat
ing, refrigeration, and various industrial
uses. It is not generally realized, per
haps, that with cooking, the principal
present day use fo r gas, peaks o f home
demand come on Sundays,, holidays, etc.,
with Thanksgiving and Christmas mark
ing the peaks fo r the year. This leaves
during the middle o f the ordinary busi
ness day a period when demand for
cooking is relatively small and facilities
are, in part, unused. Here the indus
trial load may be taken on at rates which
give a wide economic use for gas as a
fuel.
It is estimated that one-fifth o f the
soft coal now consumed, largely that used
in homes and railroad shops, could eco
nomically be replaced by gas. Threequarters o f the hard coal used in both
homes and industry could, it is claimed,
give way to gas, as well as 75% o f the
oil now used fo r house heating and in
dustrial heat treating processes. With
the eventual depletion o f many o f the
natural gas fields, manufactured gas may
be called on fo r greater production. It
is believed that there is, or will be, a
potential market fo r the artificial prod
uct equal to about sixteen times the total
present output.
DEVELOPING A BOND D E P A R T
MENT IN A MEDIUM SIZED
COMMUNITY
(Continued from page 45)
Next comes the Collection Teller. To
him matured bonds are often presented
for collection, and a suggestion from him
that the Bond Department may be able
69
to facilitate its handling, may mean a
new customer. Of course, the Bond man
can quickly ascertain if reinvestment
is contemplated, and in such a case, the
bond can be taken in at once and a new
buyer is yours.
And Mr. Collection Teller cashes cou
pons; and every coupon means a real
buyer. Of course, the Bond man doesn’t
say, “ I know you are a buyer because you
cash coupons,” but he can instantly ap
proach the prospect with an offering o f
securities and so save a lot o f waste
motion.
A fter a while it is very necessary that
salesmen be put on, fo r telephone calls,
letters and circulars lack the human ele
ment o f a personal call. The banker
should not lose sight o f the fact that,
with all the foregoing in his possession,
he is going after the investor who has
made friends with bond salesmen who
have called on him, in the past, and it is
personal contact only, plus good service,
that can bring the buyer to you.
newspaper display, or by pamphlet. The
cost is not great, the results perhaps
slow at first but sure. Here is the special
ist in the greatest field o f all— finance—
don’t forget that, and what he gives you
is the result o f extensive research and
investigation adapted to your own specific
needs.
In conclusion, the establishment o f a
Bond Department means that the bank
can buy, fo r its own investment account,
on a more profitable basis than otherwise,
and, too, that in due course, the Bond
Department can assist in building up your
Trust Department by having investors
turn over their securities to it.
Bonds
for-
Investment
Metcalf, Cowgill & Co.
In v estm en t S ecu rities
DES M OIN ES
Of course, circulars, little leaflets on
building an estate, on the wonders of
compound interest, on consulting the
banker, have their place in sales promo
tion. They all reach the investor you
may know. But how about the investor
you don’t know? The way to reach that
person is by sensible financial advertis
ing through a financial advertising man,
DES M O IN E S
Equitame Building
Market 275
S IO U X C IT Y
Dav.oson Bal'd,ng
Aaco. 57488
N ation al D istributors of M unicipalities
13 Offices
In 12 States
Chicago
Dallas
Des Moines
Detroit
El Dorado
Kansas City
Los Angeles
Omaha
Orlando
Peabody
St. Paul
Topeka
W ichita
Arkansas
C aliforn ia
Florida
Illinois
Iow a
Kansas
Michigan
Minnesota
Missouri
N ebraska
Oklahoma
Texas
/# %
T h e B r o w n -G r u m m e r C o m p a n y
W ICH ITA
KANSAS
Established 1897
Des Moines Office
L. H. DAVIS, Mgr.
2D0 Equitable Bldg
N orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
70
E uropean Stability N ow 9 5 .3
Per Cent
Neighbors!
rOU have to get close to people to
understand their problems and
their needs. Situated here in the great
Middle W est we are close enough to
do that. Our years of caring for the
casualty insurance and surety needs
in this great field have proved this.
And we carry on— soliciting your con
fidence and patronage.
'\ 7
- Federal Surety
Com pany
W . L. T A Y L O R
Vice-President and General Manager
HOME OFFICE
-
Casualty
Insurance
■jl*
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
DAVENPORT, IOWA
—
Surety
Bonds
*4
Europe now has an economic stability
o f 95.3 per cent, as measured by the sta
bility o f foreign exchange o f its prin
cipal nations, excluding Russia, according
to data just prepared by Ames, Emerich
& Co., investment brokers. This is a new
postwar high mark and compares with a
stability o f only 58.1 per cent in 1922,
and 85 per cent in 1926, as shown in
“ Economic Briefs of Europe,” one o f the
latest books on European affairs, which
has just been privately published by these
bankers.
The book discusses this growing sta
bility as the outstanding recent develop
ment in the field o f international eco
nomics. “ Indications,” say the bankers,
“ are found in the increasing strength o f
the financial position o f the central banks,
in the growing volume o f foreign trade,
and in the increasing quantity o f manu
factured goods produced and consumed.
But Europe’s recovery is most strikingly
revealed in the ever-growing stability of
the foreign exchanges o f these nations,
for, determined as this index is by all the
various factors which affect the economic
position o f the country, it is probably the
best single test o f such position.”
The volume which has been widely dis
tributed to executives in banks and bond
houses was prepared under the direction
o f the publishing bankers’ economist, Dr.
Paul M. Atkins, sometime specialist on
the American Commission to Negotiate
Peace. It was designed from the point of
view o f the investment banker and not
only contains a review o f recent changes,
but traces economic developments in
Europe since the World War, and reveals
the remarkable economic progress which
has been made during that period. It con
tains individual chapters on every country
o f Europe except Russia and Albania,
as well as chapters on factors in foreign
credit, foreign investments and foreign
trade, the economic features o f the League
o f Nations and the Dawes Plan and Rep
arations,— these last o f particular interest
in the light o f the recent report o f S.
Parker Gilbert.
Written in an easy, readable style, pro
vided with four large color maps o f
Europe, and including many tables of
significant statistics, the book has found
a very cordial welcome among banks, se
curity dealers and large private investors
in foreign securities.
It is the privilege o f every human work
which is well done to invest the doer with
a certain haughtiness.— Emerson.
The heart to conceive, the understand
ing to direct, or the hand to execute.-—
Junius.
71
Insurance
W h y Endowment Insurance Is a
“ Finished Product1"
By J O H N L . S H U F F
Cincinnati, Ohio
F EE L that the most neglected prob
lem o f salesmanship with the average
agent is his antipathy against En
dowment Insurance as an investment. Of
course, you know the old story o f larger
amount o f protection that can be pur
chased for a fixed sum o f money. But I
insist that a completed sale is either a
short term Endowment policy that tits
many cases or a long term Endowment
that will lit any case or any subject.
When you are told by the purchaser
that Endowment Insurance is not a good
investment and you do not resent it
you have not a vision o f the complete
sale because, if your applicant is un
selfish enough to purchase for his wife
and children or those who may be de
pendent upon him, why not carry it one
step farther and take care o f this same
unselfish man when he reaches a mature
age where his earning powers are abso
lutely, if not completely gone, declin
ing rapidly? Under the present con
tracts o f all companies he is not neces
sarily required to take those funds but
may leave them wTith the companies at
from 4 per cent to 5 per cent and always
have the only genuine quick asset he
possesses.
per $1,000. His Endowment will always
mature fo r more than 30 per cent greater
than the deposits. Even a Twenty Year
Endowment at age thirty-five will aver
age a deposit around $37 and $38, and he
still has the more than 30 per cent mar
gin o f profit.
I
Available Any Day
The average purchaser o f a bond buys
a bond maturing at some later date but
one of these matured Endowments with
any of our companies is available any
day for the purchaser, both as a loan
or as a cash value.
The children o f the average man of
fifty-five years o f age are iisually grown
and out o f the way, and why not have
father and mother have something which
they can mutually enjoy the balance o f
their lives, and the deposit required is
only a trifle larger? Let’s take, fo r in
stance, a young man twenty years o f age
and sell him a Forty Year Endowment.
Of course, this matures at age sixty, a
most interesting time in any man’s ca
reer. The average cost in any company,
assuming he took his dividends from the
mutual or paid a net cost from the non
participating companies, would be $15 to
$16 per $1,000, his total deposits $600
plus, and he would have had his insurance
for forty years and 60 per cent more
No Chance of Loss
JOHN L. SIIUFF
money than he had deposited at the end
o f the time. Assuming he had a Life
Policy, we would not make many sales
if we told the average young man age
twenty that he would be compelled to pay
until he was age ninety-six provided he
lived. Hence, why not take the burden
off of his back at a given time? That
is what I call a finished product.
Suppose we go to age thirty on a Thirty
Year Endowment. The average deposit
per $1,000 would be between $22 and $23,
centainly less than $25 and he has had this
magnificent protection. His total pay
ments would be less than $750 for which
he would receive 33 1 /3 per cent more
than he had paid in. Or you might sug
gest to him Endowment at age sixty-five
on which the average cost would be less
than $20 and his total payments would
not greatly exceed $700. Or even En
dowment at age seventy because we are
living longer, and the average cost would
be between $16 and $18 per $1,000.
Take age thirty-five, Endowment at
age sixty, average cost 6f between $28
and $30 per $1,000, or Endowment at
age sixty-five, average cost o f $23 to $24
The best part o f this contract is the
fact that a man’s first deposit buys him
a matured, dependable bond, and he has
no chance whatever o f loss. It does
not require his man-power, care or
thought as to the future. He has pur
chased a 100 per cent investment scien
tifically guaranteeing a fixed return and
the only one known that can be purchased
on the installment plan that does not
cost more money than if purchased in
one sum, taking into consideration, of
course, the compound interest.
In my opinion one o f the greatest serv
ices that can be rendered by Endowment
Insurance o f all kinds is to be taken by
officers o f corporations or partners, cre
ating a Sinking Fund which is depend
able and invaluable for any emergency in
the Avay o f immediate loans or perma
nent dependable investments.
Talk to Your Prospect About Himself
Remember that all of the people whose
names are in the paper are clutching
feverishly at the paper for the honest
pleasure o f seeing how their names look
in print.
‘
People experience a thrill o f delight on
seeing their names in the paper. The re
production o f their photographs is the
last word in publicity and people who
aspire to that dizzy height are not con
tent with only one copy o f the newspaper.
I f the day passes and no one remarks
on having seen the name or the piéture in
the paper, they are bitterly disappointed.
No prospect is going to throw a man
out o f his office who casually remarks to
him that he noticed “ such and such” an
item concerning “ you” in the morning
paper.
W e must forget ourselves and remember
only the prospect.— (H ow to Hold Inter
est)-—Pan-American L ife Review,
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er Í927
72
Quick Benefits
Sen. Capper, of Kansas, on
AWay toWipe Out
Farm Debt
H E fa r m m o r t g a g e d e b t o f th e
U n i t e d S t a t e s is e s t i m a t e d b y
r e p r e s e n ta tiv e s o f th e B u re a u
o f th e C e n s u s a n d o f th e B u r e a u
o f A g r ic u ltu r a l E c o n o m ic s to be
in e x c e s s o f e i g h t b i l l i o n d o l l a r s .
It h a s in c r e a s e d m o r e th a n f o u r
f o l d in t h e l a s t 35 y e a r s .
T
Albert R. Blattner o f Atlantic, Iowa,
a policyholder o f the Northwestern Mu
tual L ife Company, secured his insurance
on September 29 and was accidentally
shot and seriously injured the next day
while hunting. Mr. Blattner was covered
by his insurance since he had paid fo r his
policy at the time o f application.
J. J. Hughes, general agent for the
Northwestern Mutual Life at Des Moines
relates this story.
Establishes W elfare Fund
Henry B. Hawley, veteran president o f
the Great Western Insurance Company,
has recently established the Hawley W el
fare Foundation, the object o f which is
to provide a permanent field fo r carrying
on public welfare work in Iowa.
T h e r e is n o w a y o f s h i f t i n g t h i s
d e b t . N o w a y o f f u n d i n g it. T h e
G o v e r n m e n t c a n n o t t a k e it o v e r.
T h e r e is n o m a g i c w a y o f a b o l i s h
i n g it.
B u t I b e l i e v e t h e r e is a
w a y in w h i c h i t c a n b e e l i m i n a t e d ,
o r p r a c t ic a lly so, w it h in a g e n e r a
t io n .
Sixteen Qualify
B u s in e s s m e n h a v e f o r m e d t h e
p r a c t ic e o f c o v e r in g t h e ir in d e b t
ed n e s s w ith
life
in s u ra n c e . It
w o u ld b e p o s s ib le to c o v e r th e
fa rm m o r t g a g e d e b t w ith life in
s u ra n ce . T h e m o r t g a g e w o u ld be
c a n c e lle d w it h th e m a t u r it y o f th e
p o lic y .
T h e a v e r a g e fa rm m o r t
g a g e d e b t is a p p r o x i m a t e l y $4,000.
A n o r d in a r y life p o lic y , ta k e n at
a g e 35 w o u l d a v e r a g e a p p r o x i
m a t e l y $70 a y e a r i f c a r r i e d d u r
i n g t h e a v e r a g e e x p e c t a n c y , 32
y e a rs, o f a m an th a t a g e .
Sixteen agents o f the Equitable Life
o f Iowa recently completed qualification
fo r membership in the Twenty-a-Month
Club, which is a gain o f 77 per cent over
last year at this time. Qualification fo r
membership in this club requires $7,200
in cash premiums.
Seventy agents o f the company met
requirements fo r membership in the Tena-Month Club, a gain o f 62 per cent over
the corresponding period last year. The
requirement for this club is $3,600 in
cash premiums.
T h ere a re fe w
fa r m e r s w h o
c o u ld n o t p u t f o r t h th e e x t r a e f
fo r t to m e e t p a y m e n ts on a p o lic y
th a t w o u ld le a v e t h e ir fa r m s c le a r
to t h e ir fa m ilie s . A n e x t r a lit t e r
o f p ig s , a h u n d re d h en s p r o p e r ly
m a n a g e d , th e p r o d u c e f r o m a g o o d
m ilk c o w o r t w o , an a c r e o r tw o
in a s p e c i a l c r o p , a f e w e w e s , o r
an od d jo b o r tw o
d u r in g th e
s la c k s e a s o n w o u ld p r o v id e th e
n e c e s s a r y fu n d s .
the disposal o f time is surrendered merely
to the chance o f incidents, all things
lie huddled together in one chaos, which
admits o f neither distribution nor re
view.— (Mental A ttitude)— V ictor Hugo.
Carry Enough
Otto Y. Schnering, president o f the
Curtiss Candy Company, o f Chicago,
which makes the well known “ Baby
Ruth” candy bars, recently advocated the
carrying o f large amounts o f life insur
ance by successful business men in an
address. Mr. Schnering carries $2,500,000 life insurance himself.
“ Life insurance is as vital in the aver
age executive’s business calculations as
sales volume, overhead and production
costs,” said Mr. Schnering. “ He must
protect his company against loss o f his
leadership through death or accident
much the same as he protects its physi
cal assets including buildings, stocks and
records against fire, theft, or flood.
“ The bigger a man’s business and its
dependence on his personal direction, the
more important it is fo r him to guard
the future by carrying adequate life in
surance. Necessity o f protecting one’s
home and fam ily by insurance is a well
established axiom. But extension of this
idea into a man’s business, so that his
company and the associates who follow
him in its control are protected against
his death is one o f the industry’s newer
evolutions.”
A Guide for a Busy Life
He who every morning plans the
transactions o f the day, and follows out
that plan, carries a thread that wdll
guide him through the labyrinth o f the
most busy life. The orderly manage
ment o f his time is like a ray o f life
which darts itself through all his occu
pation. But where no plan is laid, where
A n o t h e r p la n w o u ld b e to p la c e
t h e m o r t g a g e u n d e r t h e la n d b a n k
s y s t e m a n d in t h a t w a y t h e d i f
f e r e n c e in i n t e r e s t w o u l d p r a c
t ic a lly m e e t th e life in s u r a n c e
p r o t e c t io n .
On th e w h o le I b e lie v e th e li f e
in s u r a n c e p la n o f e lim in a t in g th e
f a r m m o r t g a g e d e b t is f e a s i b l e ,
p ra c tic a b le .
A to ta l co v e ra g e , o f
c o u r s e , w o u ld b e a n id e a l w h ic h
l i k e ly w ill n o t b e a tta in e d , b u t
s o m u ch o f th e d e b t ca n b e p r o
t e c t e d in t h a t w a y t h a t m o r t g a g e s
n o l o n g e r w i l l b e a m e n a c e to
a g r ic u lt u r e a n d r u r a l in s titu tio n s .
W ith Northwestern Mutual
R. W . Baumgartner, fo r several years
with the National Clay W orks o f Mason
City, Iowa, has now become associated
with the Northwestern Mutual L ife In
surance Company in Mason City as spe
cial agent. M. H. Sims is the general
agent fo r that territory.
C arbon M o n o x id e D angers!
-—R. & R. Service. A rthur Capper
in C apper’s W eekly (O ctob er).
'M ' O W is the time, with the approach of cold weather, fo r U nderw riters to spread the
W A R N IN G S in regard to the fatal dangers from Carbon M onoxide Gas.
No r t h w e s t e r n Natio n al
Minn eap olis.Minn.
Board of Directors
F. A . C ham berlain...............................
. .. .Chm n. E x. Com. F irst N a t’l Bank
E. W . Decker ........................................
...........Pres. N orthw estern N at’l Bank
C. T. J a ffr a y ...........Pres. “ Soo” R ailw ay
Theodore W o l d ......................................
. .V ice-P res. N orthw estern N a t’l Bk.
E. L. C arpenter................... ................
. .Pres. Shevlin-Carpenter-Clarke Co.
B. F. N elson .. Pres. H ennepin Paper Co.
A . F. P illsb u ry ......................................
.........Treas. Pillsbury Flour Mills Co.
T. F. W a lla ce ...................Sec’y-Treas.
Farm ers and Mechanics Savings Bank
O. J. A rn o ld ..........................................
. .P res. N orthw estern N ational L ife
N orthw estern Ranker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Even in warm weather this gas gets in its deadly work
— -A W orcester (M ass.) dispatch, of A ugust 6 , tells o f a you ng m an overcom e while repairing
his automobile with the engine running. This was in an open yard, the victim inhaling
in close proxim ity to the exhaust, with no breeze stirring to dissipate it, and no odor to
w arn of the deadly gas which acts so quickly and so imperceptibly. H ad this happened in
a garage with closed doors, death would have been almost certain.
L IF E IN S U R A N C E C O M P A N Y
682 deaths from Carbon Monoxide Gas poisoning
were reported in new spaper accounts kept by the John H ancock Company within the twelve
m onths’ period from July, 1926, to July, 1927.
■
■
D ecem b er 1927
Gas heaters also cause trouble
— Just recently a N orwalk (C o n n .) dentist was overcom e by Carbon M onoxide Gas generated
by a gas heater in a bathroom. Gas com panies now installing gas heaters fo r domestic
use insist upon funnels to carry off the gas fum es.
People should be informed on
these points
The whole subject is treated in a booklet
issued by this Company entitled “ Car
bon M onoxide Gas.”
W rite In q u iry
B ureau, enclosing 2c postage.
of
Bo s t o n . M a s s a c h u s e t t s
73
H eads
A m erican
L ife
C onvention
O. J. Arnold, president o f the North
western National L ife Insurance Com
pany, o f Minneapolis, Minn., was unani
mously elected president o f the American
Life Convention at the closing session of
the organization held at Dallas, Texas.
The convention also voted to hold its
1928 meeting in St. Louis, Mo.
Herbert M. W oollen, president o f the
American Central L ife Insurance Com
pany, Indianapolis, Ind., the retiring
president o f the organization was elected
to a two-year term on the executive
board, while Dan Boone, president o f the
Midland L ife Insurance Company, o f
Kansas City, Mo., was elected to the place
president o f the Northwestern National
L ife o f Minneapolis. He continues as a
director o f the Illinois Life Insurance
Company and is also a director o f several
leading business institutions o f Chicago,
notably the La Salle Hotel Company and
Charles A. Stevens and Bros.
Mr. Arnold has been prominent in ac
tuarial circles fo r many years, being a
past president o f the American Institute
o f Actuaries, and is an acknowledged
authority on technical insurance legisla
tion. He rendered important service to
the life insurance interests a few years
ago on the special committee o f the Amer
ican Life Convention which in conjunc
tion with representatives o f eastern and
western companies secured uniform leg
islation in the various states in fixing the
method o f calculating the policy reserve
liability o f life insurance companies. This
removed what had been fo r many years
a source o f friction between the eastern
and western states and their companies.
At a meeting o f the Executive Council
o f the American Bankers Association for
the organization o f the new council for
the coming association year, T. R. Pres
ton, president o f the Hamilton National
Bank, Chattanooga, Tennessee, newly
elected president o f the association, an
nounced the appointment o f the follow
ing members o f the Executive Council at
large: A. P. Gianinni, chairman o f the
advisory committee, Bank o f Italy, San
F rancisco; Thornton Cooke, president,
Columbia National Bank, Kansas City,
M o .; F. M. Law, vice president, First
National Bank, Houston, Texas; Harry
J. Haas, vice president, First National
Bank, Philadelphia, and J. Elwood Cox,
president Commercial National Bank,
High Point, North Carolina.
Ro ya l U nion Life
Insurance Company
DES MOINES, IOWA
A
C h r istm a s
P o lic y
Properly presented, our juve
nile policies have a wonder
ful appeal at this time ol the
year.
Royal Union agents
are suggesting Juvenile pol
icies as practical Christmas
gifts for the children. There
O. J. ARNOLD
on the executive committee held fo r the
past two years by George Graham, vice
president o f the Central States Life In
surance Company o f St. Louis.
C.
B. Robbins, president and general
counsel o f the Cedar Rapids L ife In
surance Company o f Cedar Rapids, Iowa,
was re-elected to the committee.
The hold over members o f the execu
tive com m ittee: H. B. Arnold, president
and general counsel Midland Mutual Life
Insurance Company, Columbus, Ohio;
0 . J. Arnold, Clarence L. Ayres, presi
dent American L ife Insurance Company,
Detroit, Mich., and Charles W . Gold, vice
president and treasurer, Jefferson Stand
ard L ife Insurance Company, Greensboro,
N. C.
Mr. Arnold, the new president, has long
been one o f the outstanding figures o f
the middle west in life insurance circles.
He was, for many years, secretary and
actuary o f the Illinois Life Insurance
Company, o f Chicago, from which posi
tion he retired two years ago to become
is available no finer exempli
fication of the Christmas
spirit. For a little boy or girl,
a policy for his or her “ very
own” is an enduring gift.
These bustling days leading
R o y a l Union L ife B uilding,
C ot. S even th and Grand A v e.,
D e s M oin es, Iow a
up to Christmas are finding
our agents devoting their time
almost exclusively to the sale
of our children’s policy forms.
Royal Union Life Insurance Company
Des Moines, Iowa
A. C. TUCKER, President
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
74
Chase National Lays Cornerstone
Amid the tatoo o f riveters’ hammers
and the clang o f huge steel girders
swinging into place, the cornerstone of
the new 38-story home o f the Chase Na
tional Bank o f New York, now rising
at the corner o f Pine and Nassau streets,
was form ally laid at a private ceremony
attended by senior officers o f the bank
and the Chase Securities Corporation.
In the absence o f Albert H. Wiggin,
chairman o f the board o f directors of
the bank, who is abroad, Reeve Schley,
vice president, and James T. Lee, o f New
York, to whom the board o f directors has
entrusted the planning and erection of
the building, placed in the cornerstone
a copper box containing important rec
ords and documents dealing with the
history o f the bank during its fifty years
o f existence.
W orthy o f Tour
Recommendation
<7%HE
steady, consistent growth of
the Iowa National Fire
is a splendid testimonial
to its unselfish service
and prompt settlement
of claims, established
over a period o f eleven
years. Good judgment
dictates the advisabil
ity o f your recommend
ing this service to your
clients.
Following the laying o f the stone, offi
cials o f the bank inspected the construc
tion work now in progress, observing the
massive steel structure which will sup
port a vast pyramid o f stone and brick
towering above the historic Sub-Treasury
building in the heart o f the financial dis
trict.
Ì.
The Tall Grown
Company
in the
Tall Corn State
Iowa N a tio n a l
Fire Insurance Company
DES M OIN E S
Fire, Lightning, Tornado, Automobile
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
J.
Ground for the new building was
broken early in 1927— a notable year in
the history o f the Chase National Bank
in that it marks the fiftieth anniversary
o f its founding and the growth o f its
resources to more than a billion dollars.
The structure is scheduled for completion
next May.
Among the interesting items which
were sealed in the cornerstone today were
the follow in g :
First report o f the Chase National
Bank o f the city o f New York, dated
December 27, 1877.
Comparative statement, 1877-1927.
Last report to the Comptroller o f the
Currency at the close o f business, Octo
ber 10, 1927.
Report o f the chairman o f the Board
o f Directors at the Fiftieth Annual Meet
ing o f shareholders January 11, 1927.
Statement o f condition o f the Chase
Securities Corporation at the close o f
business, December 31, 1926.
The 1877-1922 history o f the Chase
National Bank.
A full set o f coins minted in 1927 (one
cent to one dollar).
Trade dollar bearing date, 1877, which
was the year in which the bank was or
ganized.
One sheet o f four Chase National Bank
five dollar notes containing facsimile sig
natures o f John McHugh, president o f
the bank, W. P. Holly, cashier, Series of
1902, A. B, C, D, all bearing the Serial
number 323444, Charter number 2370.
A reproduction o f the original etching
by Anton Schütz showing the proposed
new building.
to
Certificate o f laying o f cornerstone
to which seal o f bank was attached.
Facsimile signatures o f the officers of
the bank.
An Exceptional Sales Opportunity
W ill Increase Capital Stock
The Guaranty L ife Insurance Com
pany, Davenport, Iowa, has completed
arrangements fo r a $100,000 increase in
capital stock, it is announced by L. J.
Dougherty, vice president and general
manager o f the company.
Goes to Council Bluffs
E. W . Stryker, who has been con
nected with the Equitable L ife o f Iowa
as Agency Manager o f the Boone Agency,
has been made Agency Manager at Coun
cil Bluffs. Mr. Stryker entered the life
insurance business in 1913 as an agent
for the Oklahoma National Life. He re
mained with this company three years
and resigned to represent the National
Fidelity L ife in Sioux City. In 1920 he
became General Agent fo r the Columbian
National L ife in Sioux City, and remained
with that company until 1924, when he
became associated with the Equitable
Life o f Iowa as Field Supervisor. While
in Sioux City Mr. Stryker was president
o f the Underwriters Association of that
city. Y . P. Laustrup, form er Agency
Manager, desirous o f devoting his entire
time to personal production, will remain
in Council Bluffs as Special Represen
tative.
W e are licensed in the follow in g
twenty-five states and have top
contracts available in m any dis
tricts.
A n Ideal PolicySpecimen R ate at A ge 35
per $ 1 ,0 0 0 .0 0
$17
.6 0
W ith P aid-U p and Extended Insur
ance Values, A lso Optional Cash
Benefit at A ge 70.
Alabama
Arizona
Arkansas
California
Colorado
Florida
Georgia
Idaho
North Dakota
Illinois
Oklahoma
Indiana
Pennsylvania
Iowa
South Dakota
Kansas
Tennessee
Kentucky
Texas
Michigan
Washington
Missouri
Wyoming
Nebraska
New Mexico
F or full particulars address
A gency Departm ent
N ational Life A sso cia tio n
H o m e
O ffic e :
Des Moines, Iowa
Meet at W aterloo
Sixty-five agents attended the annual
conference o f the district Prudential Life
Insurance Company, with headquarters
at W aterloo, Iowa, recently. Fred W .
Newhouse, district superintendent, was in
charge o f the meeting.
The district is composed o f thirty
counties, with sub-district offices at Ma
son City,. Cedar Rapids, Dubuque and
Galena, 111.
The mind o f an educated man is greater
than the knoAvledge it possesses; it is like
the vault o f heaven, encompassing the
earth which lives and flourishes beneath
it; but the mind o f an educated and
learned man is like a caoutchouc band,
with an everlasting spirit o f contraction
in it, fastening together papers which it
cannot open, and keeps others from open
ing.— Exchange.
A mother has, perhaps, the hardest
earthly lot; and vet no mother worthy o f
the name ever gave herself thoroughly for
her child who did not feel that, after all,
she reaped what she had sown.— Beecher.
P la n n in g A h ead
The man with initiative, the man who plans ahead
and does things while others are thinking of them,
is the man who makes the biggest success in the
Life
Insurance world.
That
is just what Des
Moines Life and Annuity Cooperation is doing for
its banker agents, and will gladly do for you.
It
would help you analyze your field and determine
its possibilities and then assist in the plans for
producing business.
Such is the kind of service we render willingly and
gladly to all of our banker agents.
J. J. Shambaugh, Pres.
Des Moines Life and Annuity Company
Des Moines, Iowa
I have seen the day o f wrong through
the little hole o f discretion.— Shakes
peare.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
76
This department of THE NORTHWESTERN BANKER is to
assist SUBSCRIBERS in obtaining goods or service hard to
find. It is free to subscribers. Use it. ASK US, as we can
tell you where to buy anything you need in your bank or for
your bank. TELL US, as your “ want” will be published
under the above heading free of charge. In answering
classified advertisements which have key numbers please en
close a two-cent stamp. This is used to forward your letter.
Executive Bank Position Wanted:
With 20 years’ successful banking ex
perience, both state and national banks
in executive capacity. Married. Good
reputation for ability and genial aggressiye personality. Protestant and lodge
affiliations. Consider any desirable point,
middle west, east or south modern con
veniences. Satisfactory references fu r
nished.
Address EBC, Northwestern
Banker— Indef.
Wanted— Position as cashier of a small
bank, or assistant cashier of a large bank,
by an experienced man. Nine years of
both large and small banking experience.
Familiar with farm loans, fire and life in
surance writing, clerking sales, type
writer, adding machine, posting machine,
bookkeeping and shorthand.
Thirtythree years of age and married. Protest
ant. Can give excellent reference. At
present employed, but could accept posi
tion on thirty-day notice.
Address
Northwestern Banker,, No. 2997— Indef.
Bank Man 34 years old, single, good
record, 6 years experience wants assis
tant cashiership in country town bank.
Iowa preferred.
Reference furnished.
Now employed but desire change. A d
dress Northwestern Banker— No. 3000—
11-12.
Speeches, Special Papers, articles for
busy bankers. Prompt service skillfully
rendered on financial industrial and eco
nomic topics.
Address Northwestern
Banker— No. 3003— Indf.
For Sale At a Sacrifice on account of
owner’s disability, a complete set of ab
stract books in one of the best counties in
Northwestern Iowa. Only one other set
in county and owner’s insurance, loan
and law business will be sold if desired.
Wonderful opportunity fo r competent
man. Immediate possession given. A d
dress Box 417, Cherokee Iowa.— 12.
Bookkeeper— Competent young man
wants work before the first o f the year.
One year bank experience. Two years
college education. Good mixer. Single,
22 years of age. At present employed
and have never been discharged from any
employment. Best of references. Ad
dress Northwestern Banker. No. 3007—
12.
Wanted— A position in country bank as
Assistant Cashier by married man. About
8 years banking experience, now em
ployed but desires change. Can furnish
best o f reference. Address Northwestern
Banker— No. 3006— Indef.
Nearly New $25,000 Brick Hotel— Two
story building, in good live town, in ex
change fo r bank stock. Address North
western Banker. No. 3008— Indef.
Wanted— An Assistant Cashiership in a
country bank. Four years’ bank experi
ence and two years in a real estate and
bond office. Age 26; married; two years’
college education. Write No. 3012 North
western Banker.— 12.
A c c o u n ta n ts
Oldest firm in Des Moines
Call us for certified work
MUEHLE, REAM & McCLAIN
110S C o m m o n w e a lt h B u ild in g
Sold in I o w a b y
J. H . W E L C H P R IN T IN G CO.
1 1 6 6 -6 8 -7 0 S ix th A v e ., D e s M oin es.
P rin te rs, B in d e rs, M fg . S ta tio n e rs.
Steel and Copper Engraved
S T A T I O N E R Y , B U S IN E S S
ANNOUNCEM ENTS AND CARDS
F o r q u a lity w o r k a d d re ss
The
H o m e ste a d
C om pany,
N orthw estern Ranker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D es
M o in e s
D ecem b er 1927
Wanted— Position as cashier or as
sistant cashier in fair sized bank. Nine
years of good banking experience, serv
ing eight years as assistant cashier with
good bank. Familiar with farm loans,
fire and life insurance, typist, adding and
posting machine and bookkeeping; good
education; Protestant; 29 years old,
married. Speak German and English flu
ently. Can give excellent reference. At
present employed but desire change with
a good future.
Can invest. Address
Northwestern Banker. No. 3009— Indef.
Wanted— Position of assistant cashier.
Have had nearly 3 years’ experience in
general country banking as bookkeeper;
25 years of age, single, good health and
habits; am at present employed in a
country bank; have good reasons for
making the change.
Good reference.
Address Northwestern Banker. No. 3010
— Indef.
Wanted— Position as Cashier o f small
bank or Assistant Cashier of large bank,
by an experienced man. At present em
ployed but can make change on short
notice. Familiar with all lines of bank
ing. Have had 6 years of general bank
ing experience. Protestant, 30 years old,
married.
Can furnish excellent refer
ences. Address Northwestern Banker—
No. 3001-11-12.
Position as Assistant Cashier of a fair
sized bank wanted.
Eleven years of
Banking experience. Familiar with In
surance work, posting machine and type
writer and bookkeeping. Twenty-eight
years old, single, Scandinavian. Can give
best o f reference. At present employed.
Address Northwestern Banker— No. 2999
-1 1 -1 2 .
Young Man Wanted— Bank in small
town, wants a young man as bookkeeper
and stenographer with some experience.
Correspondence is invited and all details
should be supplied in first letter, such as
age, experience, church affiliations, salary,
including references. Address No. 3015
Northwestern Banker.— 12.
Wanted— Lady bookkeeper, experienced
in banking or knowledge of loan work,
desired by a large mortgage company.
Give full information, experience and
references in first letter. Address No.
3016, Northwestern Banker— Indef.
Wanted— Position as Cashier or Assis
tant Cashier in good country bank. Seven
years of good banking experience. Fa
miliar with all lines of country banking.
Conservative Banker. Twenty-six years
of age and married. Protestant. Best of
references available. Presently employed
but desire change. Address Northwest
ern Banker— No. 3002— 11-12.
Wanted Connection in Good Iowa Bank.
Experienced. Good education and best
of references. Address No. 2972, North
western Banker— Indef.
A Fine Set o f Bank Fixtures made by
The Artmetal M fg. Co., of Jamestown,
New York. Steel doors, steel cabinets
and drawers under counters.
Marble
fronts to counters an ornament to any
bank.
Have photographs.
Address
Northwestern Banker No. 2993— Indef.
Like a great poet, Nature produces the
greatest results with the simplest means.
These are simply a sun, flowers, water,
and love. O f course, if the spectator be
without the last, the whole will present
but a pitiful appearance; and, in that
case, the sun is merely so many miles in
diameter, the trees are good fo r fuel, the
flowers ai’e classified by stamens, and the
water is simply wet.— Heine.
Wanted— Working interest, carrying
cashiership in a good country bank.
Young man with over ten years’ banking
experience. Will invest up to $5,000.00.
Address No. 3014 Northwestern Banker.
— 12.
Give me just enough hard luck to make
me change from a weathervane to a light
ning rod, then bring on the Storm and
Thunder.— The Silent Partner.
77
his shotgun while he was hunting pheas
ants.
His body was found beside his car, with
a shot through the breast, and his gun
was hanging by the trigger guard on the
handle o f the car door.
It is believed the gun caught on the
door handle as Mr. Gebbie stepped out of
the machine.
Mr. Gebbie was 43 years old and leaves
a widow and three sons. He was a banker
at Bryant fo r 16 years.
South Dakota
Bank News
Officers South Dakota Bankers
Association
P resid en t..........................H a rry M . Griffith
G ettysbu rg
"Vice P resid en t.....................B . E. D riscoll
Lead
S ecreta ry....................... Geo. A . S tarring
H uron
T rea su rer.........- ................ —.J. 0 . B assett
A berdeen
New Building Finished
Prosperity Is Returning
What South Dakota faced by a com
bination o f deflating circumstances not
likely to be repeated again in a century,
during 1926, has “ in the first ten months
o f 1927 come back so strongly that the
whole commercial and banking world is
amazed,” is the statement o f L. N. Grill,
state secretary of agriculture.
“ Many people are unable to understand
how the financial conditions o f South Da
kota could improve so rapidly after a
period that seemed discouraging to the
greatest extent o f our farming popula
tion,” Mr. Crill said. “ A combination of
circumstances, such as will not likely oc
cur again in a century, culminated in 1926.
The farmers had suffered from the effects
o f the deflation o f the post-war period, up
setting land values and doubling their ob
ligations as measured in the products
which they raised.
“ This not only crippled the farmers o f
South Dakota, but those in every other
agricultural state.
“ Following this came the disaster of
bank failures tying up millions o f dollars
on deposits, and worse yet, shattering the
credit system o f every industry and farm
ers especially were obliged to sell cows
and growing livestock— to part with the
real substantial basis o f farm profits—
under the dire necessity o f meeting obli
gations and providing a living.
“ On top o f deflations, loss o f bank de
posits and shattering o f credit, came the
crop failure o f 1926.
“ Yet, in the face o f these disasters,
South Dakota, in the first ten months o f
1927 has come back so strongly that the
commercial and banking world is amazed.
“ Those who knew South Dakota did
not expect anything else.
“ Our great agricultural resources, the
great productive power o f the state, gave
us the assurance that soon conditions
could be righted.
“ An instance demonstrating the facts
to be true, is cited from the state banking
department. One bank in the northern
part o f the state, in the year 1926, was
forced to suspend because o f inability to
liquidate its assets as rapidly as deposits
were demanded. This particular bank was
reorganized through the agency o f the
banking department and in the reorgan
ization procedure the assets that were not
worth their full face value were not per
mitted to be taken over by the reorganized
bank and were charged and placed in a
separate account, to be handled by trustees
fo r the benefit o f creditors. Among the
assets thus charged out was a line o f pa
per aggregating approximately $7,000.
The maker o f the paper was the owner
o f an unusually large acreage o f land.
“ Due to conditions affecting agricul
ture, however, the notes were considered
to be o f questionable value. The territory
had had poor crops and the cost o f carry
ing the land was in excess o f Avhat the
owner could raise. It appeared that there
was probability that the owner would lose
title to the land. Hence the $7,000 line
o f paper was considered doubtful enough
that it was not acceptable to the banking
department as an asset. The owner of
the land, however, put in a crop o f wheat
in the spring o f 1927 and this fall har
vested a crop as the result o f which he
was able to pay the note which a year
previously had been considered worthless
or doubtful, and had, in addition to pay
ing the note, enough money left to make
a deposit o f approximately $26,000.00.”
The fine building erected by the
Farmers and Merchants Bank o f Britton,
South Dakota, to replace the one de
stroyed by fire, is ready for occupancy.
The new building is o f steel and concrete
construction making it practically fire
proof. The lobby, with its terraza floor,
white marble wainscote and fixtures with
green verde marble trimming, presents a
most attractive appearance. The bank
ing room has mahogany trimming and
beamed ceiling.
The second floor contains three modern
apartments which are already occupied.
The basement will be furnished for rental
and an office fitted up in the rear o f the
first floor.
Suit Dismissed
Dismissal o f the suit fo r $150,006
brought by John J. Large, o f Sioux City,
Iowa, against John McHugh, New l o r k
banker, in federal court, has been or
dered by Judge James D. Elliott. The
motion fo r dismissal was made by Mr.
Large through his attorney.
Mr. Large was ordered to pay the costs
o f the suit. He was the only witness
called. Mr. Large had sought to collect
damages on an alleged oral contract with
Mr. McHugh.
The dismissal was made directly after
Mr. McHugh’s attorneys had completed
cross examination o f Mr. Large, who
had been on the witness stand the greater
part o f two days. Mr. Large’s attorneys
informed the court that the evidence
showed that Mr. Large had no case.
Einar Johnson Dead
New Bank
Articles of incorporation were filed with
the secretary o f state recently fo r the
Bank o f Veblen, at Veblen, South Da
kota. The capital stock of the new in
stitution was given as $20,000. The in
corporators were : L. J. Schmizt, C. E.
Peterson, E. W . Scliouweiler, B. W .
Schouweiler and G. A. Klefstad.
Killed W hile Hunting
E. <T. Gebbie, vice president o f the State
Bank o f Bryant, South Dakota, was killed
i-ecently by the accidental discharge of
Einar Johnson, 66 years old, pioneer
banker o f Volin, South Dakota, died at a
hospital in Sioux Falls recently, after an
illness o f three weeks.
Mr. Johnson was president o f the South
Dakota Bankers Association in 1926.
He came to this country from Norway
in 1882 when 21 years old, and went di
rectly to Yankton where he lived for sev
eral years. He then went to Volin and
engaged in the banking business.
Taking ill about six months ago, his
condition grew critical and he was brought
to a hospital in Sioux Falls, where he un
derwent an operation.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
78
Resigns
Roy Willy, special counsel for the South
Dakota state department o f banks and
banking, has resigned his position to open
an office in Sioux Falls. T. B. Thoreson,
o f the Kimball law firm o f Heck &
Thoreson, has been appointed by F. R.
Smith, superintendent o f banks, by and
with the approval o f Buell F. Jones, at
torney general, to succeed Mr. Willy.
Buy Hail Warrants
Three hundred thousand dollars in hail
insurance revenue warrants o f the state
o f South Dakota have been purchased by
the Aberdeen National Bank, agent for
South Dakota Bank Syndicate, at par 4%
per cent interest payable at maturity, July
15, 1928.
The warrants, which are dated Novem
ber 15, 1927, were sold, A. J. Moodie, state
treasurer, explained, to cover payment of
hail losses for the current year, which
come in the first half o f the year and be
fore the bulk o f receipts to the hail in
surance department come in next May.
Tax Action Pending
Hundreds o f thousands o f dollars of
taxes are involved in actions now pend
ing before the South Dakota state supreme
court, in the matter o f applications by
banks in the state fo r abatement or re
fund o f taxes. The actions have grown
out o f the conflicting provisions o f fed
eral and state laws relative to the taxing
of capital stock and will have a direct
effect on Minnehaha county tax receipts
if the banks’ contentions are upheld.
The state law required that personal
property be taxed at a rate of 39.17 mills
on the dollar but provides a four-mill tax
on moneys and credits. The banks claim
that their capital stock is moneys and
Investigations and reports
on all phases of business
in the surrounding territory,
especially in the Chicago
district, are cheerfully and
painstakingly made by this
bank for its correspondents
credits and not personal property as is
listed by the assessors.
A federal law requires that a state tax
national bank money at a greater rate
than money in competition with it. In
other words, if privately owned money
which is loaned and invested in competi
tion with the money in banks is taxed at
the four-mill rate, the capital stock, if
considered money and credits, shall be
taxed at the same rate. This ruling has
been taken up by the state banks and they
claim that the state law is discriminatory
against state banks and therefore uncon
stitutional.
The law provides that application for
refund shall first be presented to the city
commission and with its approval to the
county commission. The county commis
sion has full power to take action. In
some cases it lias allowed an abatement
but no refunds. The action is based on
opinions o f the attorney general and the
tax commission. All banks in the state
will be affected by a supreme court ruling
and if the banks’ contentions are upheld,
it will mean a considerable reduction in
tax returns.
Prosperous
As an evidence o f prosperity in the lo
cality of Hot Springs, South Dakota, the
Bank o f Hot Springs, according to its re
cently published statement, has recreased
its loans in the past six months from
$466,000 to $455,000, while its deposits
have increased in the same time from
$680,000 to $737,000.
Named Special Counsel
Ted Thorson has recently received the
appointment as special counsel fo r the
S.nn+h Dakota State Banking Department,
South Dakota State Banking Department,
with headquarters at Pierre.
High school, and the law department of
the University o f South Dakota, where he
received his degree six years ago. He has
been practicing law at Kimball and served
two terms as state’s attorney o f Brule
county.
Conditions Improved
THE NORTHERN
TRUST COMPANY
Capital, Surplus and Undivided
Profits, over $7,500,000
Northwest Corner La Salle and M onroe Streets
C H I C A G O
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Financial conditions in South Dakota
are steadily improving, as is shown by the
fact that deposits in W atertown banks
have increased approximately $1,000,000
during the past two months.
The increase is largely due to cash re
ceived in the district in payment fo r grain
shipments sent to market during the two
months.
The shipments o f grain and
other products are continuing, and will
continue fo r a good part o f the winter,
assuring further increases o f several mil
lions o f dollars in the bank deposits o f the
Watertown banks and those in other cities
and towns o f the district.
79
DO SPECIAL SAVINGS CLUBS P A Y ?
(Continued from page 19)
to merchandise our services. For these
reasons it was thought extravagant, and
correctly so, fo r if we advertised our
thrift clubs, we were actually advertising
our advertising.
“ Then came an increase in depositors
and a great increase in deposits; and each
o f the big news-gathering agencies at
Christmas time began to tell the world
how many millions o f dollars the country
had saved in Christmas Savings Clubs
during the 50 weeks preceding. That
interesting item o f news reaches page
one today, and not the fact that the
Mammoth National Bank o f tin1 Metrop
olis has added another billion dollars in
resources.”
Mr. Izant makes these observations re
garding the analysis o f special savings
club accounts:
“ Next came our analysis that the gross
income o f the special purpose savings
division was sufficient to pay the salaries
o f tellers and bookkeepers, and this in
turn gave "us incentive to trace the
journey and transactions o f special pur
pose depositors. Observing that lump
sums from thrift club checks would be
placed on deposit in regular savings ac
counts; finding them buying bonds; dis
covering to our pleasure more regularity
in reducing mortgage loans, bankers the
country over at last have realized how
important this mode o f saving really is,
and ju stify the added expense o f initial
outlay without any debate.
“ And so at Christmas time we send
out many advertising dollars into the
highways and hedges to attract new de
positors. In fact, we have studied the
mode so assiduously as to introduce vari
ous off-shoots such as the $1,000 clubs,
the Fortune Founder, the Financial In
dependence Fund Plan, and so on.
Frankly, though, we are experiencing no
little resistance in promoting these off
shoots.
Scholarship Fund Practically Subscribed
More than $445,000 o f the half-milliondollar goal fo r the Educational Founda
tion Fund o f the American Bankers A s
sociation to be used in establishing
scholarships in institutions of higher
learning in the various states, have been
paid or definitely pledged, according to
the reports o f the Foundation Trustees.
Only $60,542.75 is lacking to complete
necessary funds to found these scholar
ships and two months still remain to se
cure this amount.
A t the fiftieth anniversary meeting o f
the American Bankers Association held
in Atlantic City two . years ago, the
fiftieth anniversary committee announced
plans for form ing this Educational Foun
dation. In order to secure the $500,000,
personal pledges were secured for about
half o f that amount and the balance was
allocated to the various states to be ap
portioned among their respective banks.
The plans provided fo r the fund to be
completed by January 1, 1928.
,
m e a -i .
-
Tlie excellence of
Live Stock Na
tional service i s
t h e result o f
painstaking re
search into meth
ods and strict at
tention to details.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
80
J$A4h
1
L
4\
/ii
ffO
1 : wrjf
&
iüSHIIWWtf:
.i-mTJT)
M
I*^Mmhii«/«'
Central T r u st C o.
w o r k s with its
correspondents as
w ell as for them
°Qp
C
entral
T r u st
COMPANY OF ILLINOIS
125 W. Monroe Street at La Salle
C H ICAG O
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er PJ27
81
the lobby extending on three sides. To
ward the rear a vault for safety deposit
boxes will be built. The present vault
will be used by the bank itself. Still far
ther back will be rest rooms for both men
and women and office rooms for bank o f
ficers and directors.
The front entrance to the building will
be through the present door into the bank.
N eb rask a
J3ank News
Officers Nebraska Bankers
Association
C. A. SM ITH
President
P resid en t............................... 0 . A . Sm ith
T ilden
Chairman o f the E xecutive
C ouncil....................... Fred R . H a ggart
St. Paul
S ecreta ry........................ ......W . B . H ughes
Omaha
T rea su rer........... .................. F rank B oyd
Omaha
General C ounsel............. ...J. P. Palm er
Omaha
Goes to Lincoln
William Crossland, cashier at the State
Bank at Laurel, Nebraska, fo r a number
o f years, lias gone to Lincoln to take up
his new duties as a member o f the state
banking department.
New Bank at Kearney
Formation o f a new national bank to
take the place o f the City National Bank,
in Kearney, Nebraska, has been an
nounced. It will be in the bands o f stock
holders o f the former bank.
The new institution will have a capital
o f not less than $100,000 with a surplus
o f not less than $20,000. It will purchase
from the receiver o f the former bank a.
considerable sum o f the assets in order
that a substantial dividend can be made
to the depositors soon after the new con
cern opens.
Remodeling
A complete change o f interior is
planned for the First National Bank o f
Randolph, Nebraska, and work began
when the safety deposit boxes were
changed to old vault and big safe moved
to the new vault.
The change includes an entrance on the
east side instead o f the west corner, the
work room will be to the west and the
lobby to the east. A new asbestos cement
door will be laid, a new counter installed,
a directors’ room and a private room pro
vided fo r the vice president.
These changes and perhaps some others
will make fo r the better convenience o f
the bank’s customers and the working
force.
Clearings Gain
Bank clearings in Omaha for October,
1927, totaled $12,000,000 more than that
o f October, 1926, figures compiled by the
Omaha Clearing House Association show.
Clearings fo r October, 1927, totaled^
$197,629,081, while October, 1926, totaled
$185,590,710.
The only month in 1927 to compare
closely with October was March, with
$193,502,966. March o f 1926, however,
To Open Bank
W M. B. H U GH ES
Secretary
had larger clearings with more than $208,000,000.
The bank clearings fo r the first 10
months o f the year totaled $1,750,473,090,
while the clearings o f 1926 totaled $1,760,559,500 or a decrease o f $10,000,000.
This is attributed by Omaha bankers to
the small clearings the first six months o f
the year.
Bankers Meet
The annual meeting o f the Bankers As
sociation o f Richardson county was held
recently at Falls City, Nebraska.
Otto Kotouc o f Humboldt was elected
president o f the organization during the
business session. Other officers elected
were Chas. W ier o f Verdón, vice presi
dent ; W . L. Evans o f Shubert, secretary ;
R. A. Tynan o f Stella, and Dan J. Riley
o f Dawson, advisory board.
The meeting was attended by about 25
members including the following from
Falls City: George S. Lyon, Wm. Uhlig,
B. K . Baker, Frank Schaible, Ingram
Cain, C. W . Thornton, J. R. Biles and L.
P. Wirth.
Show Big Gain
The five commercial banks and savings
institution at Omaha reporting to the
Federal Reserve Bank had $433,334 more
on deposit on October 1, 1927, than on
deposit October 1, 1926.
On October 1, 1927, there was $8,134,982, while on October 1, 1926, de
posits totaled but $7,701,648. Deposits
at the five banks on September 1, 1927,
totaled $989,154.
Enlarge Space
A building in Columbus, Nebraska, is
being remodeled and will be occupied by
the First National Bank about January
1st, or as soon as the remodeling is com
pleted.
The inside walls between the
present bank building and the vacant
room will be removed and both buildings
used for the bank business. This will give
the bank a space 40 by 88 feet.
Under the plan or rearrangement the
tellers cages will be in the center o f the
room near the front o f the building, with
O. J. Frey o f Sheldon, Nebraska, and R.
H. Griffen o f Doon, are planning organiz
ing a state bank in Sheldon.
The capital stock is to be $50,000 and
surplus $15,000. About half the necessary
stock and surplus have been subscribed.
Mr. Frey and Mr. Griffen are desirous
o f opening a second bank in Sheldon pro
viding they are convinced that there is
demand fo r such an institution.
Nationalized
The Commercial State Bank o f Ains
worth, Nebraska, recently received a na
tional charter, and will now do business
under the name o f the Commercial Na
tional Bank.
No change was made in the manage
ment or organization o f the bank, except
that it will operate under a national char
ter. This bank has been under the same
management fo r fourteen years, and is a
strong financial institution.
Install Clock
The First National Bank o f Fullerton,
Nebraska, installed a master chime clock
at corner o f the bank building. Mr. H ol
ton, o f the O. B. McClintock Co., is in
stalling the clock.
The clock, which is in a position easily
seen from many directions, will strike four
notes o f the Westminster chimes at the
first quarter-hour, at the half-hour the
Cathedral peal will sound, at the threes
quarter hour, the Reveille and at the full
hour the chimes ring sixteen notes, the
full Westminster chime.
Charter Filed
H. S. Clarks, Jr., o f Omaha, has filed
application fo r a charter to organize the
First National Bank o f Bennington, Ne
braska, with a capitalization of $255,000.
Purchase Safe
Burglar p roof equipment and a safe
has been purchased fo r the Nebraska State
Bank o f Milford, Nebraska. The safe
will be placed in the vault and encased
in steel reinforced concrete. Enclosing
the safe in concrete will prevent its beingtipped over as was the case when the
bank was looted a short time ago. Before
a burglar could drill a hole through the
safe he would have to clear away almost
two feet o f solid concrete and steel, and
to drill a hole into the safe from the front
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
9
D ecem b er 1927
82
would be a long task as the door is almost
16 inches thick. Burglar p roof attach
ments will be fitted on the vault door.
New Banks
Large C orn C rop C reates
H e a v y F e e d in g D e m a n d
M a y we assist you in handling
FEEDER
LOANS?
Live Stock N ational B ank
Union Stock Yards — Omaha
W . P. A dkins, President
A lv in E. Johnson, V ic e President
H ow ard O. W ils o n , Cashier
R. H. K roeger, A ssistant Cashier
L. V . Pulliam , A ssistant Cashier
W . S. H ogue, A ssistant Cashier
W
E OF this bank real
ize that no transac
tion can be considered a
success unless both par
ties to it derive a benefit.
In consequence, w e
constantly strive to make
our relations with every
single banker who favors
us with his patronage mu
tually advantageous, and
if our growing list of cus
tomers is any indication,
it is a policy that is meet
ing with g e n e r a 1 ap
proval.
While Attending the “ In tern a tio n a lM a k e
This Bank Your Headquarters. You'll
Be Most Welcome
THE STOCKYARDS NATIONALBANK
THE STOCK YARDS TRUST & SAVINGS B A N K
o f C H IC A G O
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Following the sale o f the building, fix
tures and assets o f the old First State
Bank o f Pawnee City, Nebraska, to a
group o f local men, the state trade and
commerce department recently issued a
charter to the purchasers for a new bank
to be opened there immediately, under the
name o f Citizens’ State Bank.
Those named as directors o f the new in
stitution are J. D. Barr o f Pawnee City;
A. H. Wherry and A. C. Paili, also of
Pawnee City.
They are the principal
stockholders. The new bank is capitalized
at $25,000, and has put up $1,000 addi
tional as its guaranty fund reserve.
School Savings
Approximately one thousand pupils o f
the city schools are participating in the
North Platte, Nebraska, Schools Savings
System, and at the bank, which are the
depositories fo r the funds, it was said that
the number o f these pupil-depositors is
constantly increasing. While a majority
o f these boys and girls withdraw their de
posits at the end or beginning o f the school
year, it is learned that a certain percent
age allow their savings to accumulate. In
some instances the individual bank bal
ance reaches and exceeds a hundred dol
lars, and there are cases where the heaviest
depositors come from families where the
earning capacity is light. Deposits draw
four per cent interest.
The semiannual meeting of the bankers
o f Colfax County, Neb., was held at
Clarkson, Nov. 18. Every bank but one
in the county was represented, and all ex
pressed themselves as anticipating im
proved conditions follow ing this year’s
good harvest, to last during next year.
Emil Peterson o f Clarkson was toast
master, and talks were given by E. F.
Folda and R. T. Anderson, o f Omaha.
C. A. Smith of Tilden, president o f the
Nebraska State Bankers Association, was
the principal speaker at the semi-annual
meeting o f Platte County Bankers A s
sociation, at Monroe, in mid-November.
Mr. Smith discussed particularly the
county clearing house and credit asso
ciation o f the Dodge county banks, re
cently inaugurated under the plan pro
posed by Dan Stephens, and he congratu
lated the Platte county bankers on their
cooperation in banking. Forty bankers
were present at the principal meeting,
which was presided over by S. E. Pearson,
Monroe banker, president o f the county
association. (I. H. Gray, Columbus, re
sponded to the welcoming address, and
served as toastmaster at the banquet.
83
The Columbus, Neb., bankers were repre
sented by H. A. Yiergutz, Commercial
National Bank; A. F. Plagemann, A. J.
Phillips, Miss Elsie Kent and Miss Mary
Walter, Central National Bank; M.
Brugger, Y . H. Weaver and Miss Edna
Lenhouts, Columbus State Bank; G. H.
Gray, W . H. Luers, P. A. Peterson, J. L.
Brunken and Miss Dora Neumeister, First
National Bank.
Dan V. Stephens, president o f the
Fremont State Bank, and one o f the lead
ers among Nebraska bankers, a former
congressman from the third Nebraska
district, is being prominently mentioned
for appointment to the interstate com
merce commission by President Coolidge.
He has the endorsement o f Governor M c
Mullen, o f Nebraska, and other western
leaders for the post, but as far as he him
self is concerned, he has announced that
the move to name him to the place has
been a complete surprise, and appoint
ment would seriously interfere with his
private plans and business.
Subscriptions were being taken in No
vember for capital stock in the reorgan
ized First State Bank o f Murphy, Neb.,
in the hope o f launching the bank again
into business on a sound basis. The bank
was taken over and is being operated by
the guaranty fund commission, pending
the result o f the drive fo r new stock.
L. W . Weikel, president and J. R. Nel
son, vice president o f the bank, called
a meeting o f the people in the vicinity o f
Murphy, to discuss reorganization plans,
and met with encouraging response. G.
R. Buckner, assistant secretary o f the
guaranty fund commission, is assisting.
The plan calls fo r subscription o f $15,000
dollars in new stock, to take up an equal
amount o f “ slow paper,” and greatly
strengthening the bank. Farmers and
business men in the Murphy community
have joined generally in the movement
to reform the old bank, as new bank
charters are not being granted in the
smaller towns o f Nebraska.
Walter W. Head, president o f the
Omaha National Bank, and president o f
the Omaha Y. M. C. A., has been elected
a member o f the general board o f the na
tional council o f the Y. M. C. A.
Conditions Improved
The 867 state banks o f Nebraska, for
the three months ending September 30th,
showed a gain in deposits o f over eight
million dollars, an increase in cash re
serve o f over $3,600,000, and a reduction
EFFICIENCY
A bank organization that can
handle over 1 5 0 ,0 0 0 items
daily must be efficient. The
constant 24-hour attention
in receiving and dispatching
this great volume of business
by transit and collection dep a r t m e n t s in continuous
operation means much to
our correspondents.
W e are confident that few
banks can equal, and none
surpass, the service which
this institution offers banks
requiringa thoroughly equip
ped commercial city corre
spondent.
Efficiency is not a slogan
with us. It is a cold, hard
business necessity.
All items received at par.
N o charge for telegraphic
transfers.
a
TH E
PHILADELPHIA - G IR AR D
N A T IO N A L BAN K
PHILADELPHIA, PA.
Capital, Surplus and Profits . . . $29,000 000
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
84
in loans o f $3,500,000. The showing is
taken in part, at least, as reflection of
the unusually good crop conditions in the
state this year.
The total deposits o f the banks on Sep
tember 30th, were $285,365,603; compared
to $275,133,998 on June 30th preceding.
This increase represents the farmers’ pro
C o m p lete Financial Service
C
•
U
N a tio n a l B ank.
Trust Com pany
Omaha
The National Park Bank
New York
of
214 Broadway
Uptown Offices
P a r k A v e n u e and 46th S t r e e t
S e v e n t h A v e n u e and 32nd S t r e e t
R ICH A RD D E L A F IE L D
Chairman o f the Board
C H A R LE S S. M cCA IN
President
C H A R LE S SCR IBN E R
V ice President
M A U R IC E H. E W E R
V ice President
H. E. SCH E U ER M A N N
V ice President
R A L P H L. CERERO
V ice President
J A Y D. RISIN G
V ice President
H A RO LD W . V A N D E R P O E L
V ice President
JAM ES BRU CE
V ice President
F R E D E R IC K O. F O X C R O F T
Cashier
W IL L IA M A . M A IN
A sst. V ice President
C LAU D E H. B E A T Y
A sst. V ice President
W A L T E R S. J E L L IF F E
A sst. V ice President
W IL L IA M C. M A C A V O Y
A sst. V ice President
JOH N M A TTH E W S , JR.
A sst. V ice President
LO U IS H. OHLROGGE
A sst. V ice President
R. J. W H IT F IE L D
Asst. V ice President
H E N R Y L. SP A R K S
A ssistant Cashier
B Y R O N P. R O BBIN S
A ssistant Cashier
W IL L IA M E. D O U G LA S
A ssistant Cashier
JO SE PH E. S IL L IM A N
A ssistant Cashier
S T A N L E Y F. KETCH AM
A ssistant Cashier
JO H N B. H E IN R ICH S
A ssistant Cashier
H A R O LD M. T R U S L O W
A ssistant Cashier
GEORGE C. B R A D E N
A ssistant Cashier
K E N L Y S A V IL L E
A ssistant Cashier
W IL L IA M F . L A T U S
A ssistant Cashier
ceeds from wheat and oats sales, as the
corn harvest proceeds were not in cash
on September 30th.
Loans fell from $211,642,982, in June,
to $208,047,022, in September.
This
again is taken as an indication that the
farmers have been greatly reducing their
loans and new indebtedness is not being
contracted in the same proportion as the
old loans.
September 30th cash reserves averaged
19 per cent o f deposits. The reserves in
cluded $9,764,000 cash on hand and $42,642,000 o f reserve deposits in other banks.
The gain in reserve since June was $3,612,808.
There were fou r fewer banks Septem
ber 30th than in the preceding June and
their capital was $164,000 less and sur
plus fell oft $105,000. Undivided profits
showed an increase o f $604,986.
From Nebraska
The follow ing persons from Nebraska
attended the recent A. B. A. convention
in H ouston:
*Baumann, J. T., president, West Point
National Bank, West Point; Rice.
*Brownell, R. O., cashier, Schuyler State
State Bank, wife and daughter, Schuy
ler; O. S. T. Camp.
*Cain, J. R., Jr., vice president, Peters
National Bank, Omaha; Rice
*Jensen, Arthur, vice president, Minden
State Bank, and wife, Minden; Milbv.
Ivirchman, W. H., cashier, Saunders County
National Bank, Wahoo; Rice.
*Larned, Wm. H., cashier, State Bank of
Haigler, Haigler; Ben Milam.
*Ley, Rollie, president, State Bank of
Wayne, and wife, Wayne; Wm. Penn.
McConnell, L. W., guest of W. G. Springs,
First National Bank, McCook; Ben
Milam.
*Menck, C. H., vice president, Commercial
State Bank, Grand Island; Macatee.
*Nicholson, H. C., vice president, Packers
National Bank, Omaha; Sam Houston.
*Ormsby, Ernest, cashier, Farmers’ Ex
change, and wife, Trumbull; Brazos.
Pennell, F. A., director, First National
Bank, McCook; Ben Milam.
*Petermichel, Jul, vice president, Oak
Creek Valley Bank, Valparaiso; Rice.
*Pettygrove, W. T., director, Security State
Bank, and wife, Oxford.
xSpringer, W. G., cashier, First National
Bank, and wife, McCook.
*Stephens, Dan V., president, Fremont
State Bank, Fremont; Rice.
Tegelberg, O. B., vice president, Nebraska
State Savings Bank, Wahoo; Rice.
Waite, H. P., vice president, First National
Bank, McCook; Ben Milam.
*Walsh, P., president, McCook National
Bank, and L. W. McConnell, McCook;
Ben Milam.
*Weston, W. S., vice president, Peters
Trust Co., and wife, Omaha; Rice.
*Yates, Gwyer H., vice president and cash
ier, The United States National Bank,
Omaha; Rice.
^Delegate.
CAPITAL, SURPLUS AND UNDIVIDED PROFITS, $34,000,000
Any man starting out with his shoes
buttoned up on the inside playing both
sides of the road never gets anywhere.
“ Start right and succeed.” — James E.
Newburn.
N orthw estern B anker D ecem b er 1927
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
85
light inside. A t the front the offices are
lighted only by electricity.
Enclosed scaffoldings have been built
where the new windows are being cut and
the stone is being taken out piece by piece
and lowered to the sidewalk. There will
be four windows, each five by 11 feet,
placed in pairs. They will not weaken
the strong box structure o f the bank.
M in n eso ta
B ank News
Officers Minnesota Bankers
Association
P resid en t................. ........A . G. W ed ge
P ark R apids
A, G. W E D G E
P resid en t
V ic e P resid en t............. I . —. H ansen
St. Paul
Pioneer Dies
T rea su rer.................. A. M . Schaefer
Jordan
Hon. Charles S. Crandall of Owatonna,
Minnesota, died recently at the age of 87
years.
He was well known in St. Cloud, where
he often visited his daughter, Mrs. C. L.
Atwood, and was associated with Mr. A t
wood in some business enterprises, being
fo r several years vice president o f the
Security State Bank before its merger
with the American National.
Senator Crandall was one o f the real
pioneers o f Minnesota, a very able man,
with outspoken courage, patriotic loyalty,
strict integrity and high character.
He was born in Erie county, Ohio, 1840,
and came to Minnesota in 1857. He was
postmaster o f Owatonna for eight years,
editor of the Owatonna Journal for many
years, member o f the legislature in 1874,
and state senator in 1886 and 1890, serv
ing eight years, and was one o f the recog
nized leaders o f a senate noted for its
able members.
S ecreta ry......... ........... F. P . F ellow s
St. Paul
Nash Buys Interest
T. E. Nash o f Pipestone, Minnesota,
formerly with the Marshall State Bank,
has returned to take over the management
o f that institution. Guy Evarts, who has
been vice president o f the bank fo r the
last four years, sold his interest to Mr.
Nash, J. V. Williams, L. H. Powell, and
Dr. F. D. Gray. Mr. Nash will assume
management at once.
The new head o f the Marshall State
is well known in that territory having re
sided there fo r several years before taking
the position o f cashier of the First Na
tional Bank at Pipestone from which he
has now resigned.
New in Minneapolis
The Fifth Northwestern National Bank
at Minneapolis organized to serve the Hen
nepin and Lake street districts was o f
ficially opened recently.
The bank has a capital o f $100,000 and
a $10,000 surplus.
The charter was
granted by the treasury department at
Washington. Directors o f the bank in
clude a number o f business men o f the
Hennepin and Lake street district and
the Lank is affiliated with the Northwest
ern National Bank which owns the capi
tal investment of the Fifth Northwestern
National with the exception o f qualifying
shares owned by the directors.
Clarence E. Hill, vice president o f the
Northwestern National Bank will be pres
ident of the Fifth Northwestern, with
Harry H. Sivright, manager and vice
president, and Charles R. Sheridan o f the
Northwestern National Bank as cashier.
A pply for Charter
A charter has been applied for to start
a new bank in Redwood Falls, Minnesota,
by the follow ing: W . W . Klingman, A.
Y. Ott, A. W . Thompson and H. B. Rob
ertson. I f the charter is granted the pro
posed name o f the bank is to be Citizens
State Bank o f Redwood Falls,-and the
bank will be located in the former First
National Bank building.
Consolidation
The First National and the State Bank
F. P. FELLOWS
S ecretary
o f Bricelyn, Minnesota, recently an
nounced their consolidation with a capital
stock o f $20,000, a surplus of $20,000,
and deposits o f $485,000.
The consolidated banks will retain the
name o f State Bank o f Bricelyn.
This bank, the directors believe, will be
the largest financial institution in Fari
bault county and they expect deposits to
reach $550,000 by January 1.
E. O. Lund, now president o f the First
National, will be president o f the new
bank. P. J. Flo, now cashier at the First
National, will be cashier. W . E. C. Ross
of Blue Earth will be chairman o f the
board o f directors and H. N. Chadbourn
o f Minneapolis a member o f the board.
Stockholders will continue to hold their
proportionate amounts o f stock.
Celebrates Anniversary
The State Bank of New Prague, Minne
sota, celebrated its 44th birthday anni
versary recently.
The State Bank opened fo r business
on November 1, 1883, with Joseph Maertz
as president and Michael Schreiner as
cashier, and it has grown from deposits
o f only a few thousand dollars to nearly
$800,000.
Let There Be Light
The Minneapolis Federal Reserve Bank,
built without a single light opening in its
exterior walls, now is to have windows.
The openings are being cut through the
solid stone wall on the second story o f the
Fifth street frontage to give natural light
to the governor’s and federal reserve
agent’ s offices.
The building was designed by Cass Gil
bert, famous New York architect, and the
late John H. Rich, as chairman o f the
board, insisted that it be made bomb
p roof and otherwise impregnable to any
thing but a large armed force supported
by artillery. F or this reason, no exterior
windows were included in the plan. The
side walls, however, are merely screens
o f solid stone, 60 feet high, with a space
17 feet wide between them and the in
terior bank walls. The interior walls
have plenty o f windows, affording natural
County Bankers Meet
The annual meeting o f the Mille Lacs
County Bankers Association held recently
at Milaca, Minnesota, in the rooms o f the
First National Bank, was well attended.
Representatives from practically all of
the banks in the county were present.
A fine lunch was served in the early
part o f the evening and a brief business
session followed with a smoker and social
time. The new officers elected to serve
during the coming year w ere: W . H.
Smith, o f Princeton, president; AY. A.
Benzie, o f Onamia, vice president; and
Dan Sundberg, Jr., o f Bock, secretary and
treasurer.
Midland
National Bank
and
T rust C ompany
Resources $25,000,000.00
t
M IN N E A PO LIS
N orth w estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
86
Banker Dead
Frank A. Dahl, president o f the Farm
ers State Bank o f Chisago City, Minne
sota, since 1909, died at his home recently
following an illness o f several months. He
was 68 years old.
Mr. Dahl, who was mayor o f that city
for several years, came here in 1891 from
Spring Lake, Minn., and founded the
Dahl house, one o f the well known sum
mer resort hotels in the state. He is sur
vived by his widow and two daughters.
Heads Committee
John W . Barton, vice president o f the
Metropolitan National Bank o f Minne
apolis, has been appointed as chairman
o f the committee on non-cash items o f
the American Bankers Association, one of
the important groups of the national or
ganization o f bank executives. This was
announced recently at the association’s
headquarters in New York by President
Thomas R. Preston o f Chattanooga, Tenn.
Members and heads o f the 19 major sub
groups o f the association were also an
nounced. Other northwest bankers given
recognition in preparing the list were Bur
ton M. Smith, president o f the Bank o f
North Lake, Wis., who was named chair
man o f the agricultural commission, and
J. H. Puelicher, president o f the Marshall
A Illsley Bank, Milwaukee, who heads the
public education commission.
Bankers Meet
Members o f the Chippewa County
Bankers Association held a business meet
ing recently at the Security National
Bank at Montevideo, Minnesota.
This
was the occasion o f their annual meeting
and election o f officers. W . D. Grashus
o f Clara City was re-elected president and
F. P. Schulte o f Maynard was re-elected
secretary o f the association fo r the ensu
ing year.
A fter the business meeting the bankers
adjourned to the Riverside Hotel where
a banquet was enjoyed.
Maynard banks were represented by
O. A. Dahleen, L. S. Martinson, F. I.
Frendine and F. P. Schulte.
Reduction in Rate
A stop at the Hotel
Chase will assure you
that quiet refinement
which is invariably at
tached to homes of dis
tinction.
Located in the heart of
fashionable St. Louis,
o v e r lo o k in g beautiful
Forest Park. Five hun
dred rooms each with its
own bath.
Unexcelled as a Conven
tion Hotel.
HOTEL CHASE
ST. LOUIS
L i n d e l l at F o r e s t P a r k
Geo. T. Thompson
Frederic C. Skillman
Managing Directors
N orthw estern Ranker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Pearson
Hotel
On the near North Side
C H IC A G O
HE pleasure o f your Chicago
visit will be heightened if
The Pearson is selected as
your stopping place. It is located
just outside o f the business, the
atrical and shopping district, yet
within pleasant walking distance;
its moderate rates, unexcelled
equipment and service, notably
good and reasonably priced food,
all make it a perfect base for
opera, concert, theatre and shop
ping expeditions. A 300-car fire
proof garage is close by.
T
SEND T O D A Y FOR
ILLUSTRATED FOLDER
The P earson is a b lo ck east
o f the in tersection o f P earson
Street
and
N orth
M ichigan
B oulevard. R ates fo r one p e r
son are from $3.50 to $5.00 a
d a y ; fo r tw o $5.00 to $ 7 .0 0 ;
tw o-room
suites
$10.00
to
$ 12.00. E very room and suite
with p riva te bath.
The Federal Intermediate Credit Bank
o f St. Paul recently announced a reduc
tion o f one-quarter o f 1 per cent in its
rediscount rate, effective immediately.
This marks the third rate reduction since
the bank was organized in 1923, accord
ing to J. A. Rickert, vice president. The
new rate is 4y2 per cent.
The former rate o f 4 % per cent has
been in effect since July, 1926. When the
bank was opened in 1923 a rate o f 5y2
per cent on rediscounts prevailed. In No
vember, 1925, the first reduction was made
when the rate was lowered to 5 per cent.
The new rate reduction, according to
Mr. Rickert, means that the interest rates
charged to the borrower will be limited to
7 per cent as the regulations provide that
discounting agencies which operate be
tween the credit bank and the borrower
charge not more than 2y2 per cent.
The ability o f the bank to refinance ma
turing debentures at a lower rate was
given as the cause fo r the reduction. The
Federal Intermediate Credit bank now has
outstanding loans o f $7,600,000, an in
crease o f $3,000,000 in the past year. Since
its formation in 1923, the bank has ad
vanced to farmers marketing co-opera
tives and individual farmers fo r agricul
tural purposes more than $25,000,000.
From Minnesota
The follow ing persons from Minnesota
attended the recent A. B. A. convention
in H ouston:
*Chapman, C. A., president, First National
Bank, Rochester; Rice.
*Dabelstein, C. F., president, Olmsted
County Bank & Trust Co., and wife,
Rochester; with Dr. Marcus.
■^Fellows, Fred P., secretary, Minnesota
Bankers Association, Minneapolis; Rice.
*Haven, G. A., president, First State Bank,
and wife, Chatfield; Sam Houston.
*Hechtman, A. P., cashier, Farmers State
Bank, Osseo; Maeatee.
xHumason, H. B., vice president and cash
ier, American National Bank, St. Paul;
Rice.
87
"Ing'wersen, J. H., vice president, First Na
tional Bank, Duluth; Bice.
"Kingman, Henry S., assistant to treasurer,
Farmers & Mechanics Savings Bank,
Minneapolis; Bice.
Lillibridge, Robert C., auditor, First Na
tional Bank, St. Paul; Ben Milam.
*Maloney, J. J., cashier, Farmers State
Bank, Heron Lake; Bice.
"Pomeroy, Julius S., vice president, First
National Bank, Minneapolis; Bice.
*Bose, James A., assistant cashier, North
western National Bank, and wife, Minne
apolis ; Plaza.
*Botering, Victor F., cashier, First Minne
apolis Trust Co., Minneapolis; Bice.
*Delegate.
Consolidation Ratified
Stockholders o f the Continental and
Commercial Banks of Chicago, at a spe
cial meeting last month, approved the con
solidation o f the Continental and Commer
cial Trust and Savings Bank with the Con
tinental and Commercial National Bank
o f Chicago, under the title, Continental
National Bank and Trust Company o f
Chicago.
Issuance o f a 40 per cent stock divi
dend, to stockholders o f record November
20, was authorized.
Present officials o f the two banks were
elected to take office in the consolidated
Irank December 1, 1927, the date the con
solidation becomes effective.
The name o f the Continental and Com
mercial Company, the investment securi
ties company affiliated with the Conti
nental and Commercial Banks, was
changed to Continental National Com
pany
The name o f the Continental and Com
mercial Safe Deposit Company was
changed to Continental National Safe De
posit Company.
The capital o f the consolidated bank
will be 35 million dollars, surplus will be
30 million and undivided profits will ex
ceed 3 million.
The stock ownership o f the two banks
was identical and the managements were
interrelated. The action o f the stockhold
ers today is the last step in the complete
unification o f the two commonly owned
banks.
Clic (Chase Rational iBank
of tbc (£ttu of pKeffi -fïork
57 B R O A D W A Y
Capital
Surplus and P r o f i t s ..............................
Deposits (October 10, 1927)
.
.
.
40,811,628.64
877.085,350.06
OFFICERS
A L B E R T H . W IG G IN
Chairman of the Board
J O H N M cH U G H
R O B E R T L. C L A R K SO N
Vice Chaim
President
the Board
Vice Presidents
S A M U E L H . M IL L E R
ALFRED
C. A N D R E W S
F R A N K O. R O E
C A R L J. S C H M ID L A P P
ROBERT
I.
HARRY
REEVE
G E O R G E E. W A R R E N
SCH LEY
S H E R R I L L S M IT H
BARR
G E O R G E D. G R A V E S
H E N R Y O L L E S H E IM E R
H . POND
S A M U E L S. C A M P B E L L
W IL L IA M E. L A K E
M . G. B. W H E L P L E Y
Vice President
W IL L IA M
and Cashier
P. H O L L Y
Second Vice Presidents
F R E D E R IC K W . G E H L E
M. H A D D E N H O W E L L
JOS. P U L V E R M A C H E R
E D W IN A. L E E
A L FR E D W. HUDSON
L E O N H. JOHNSTON
W IL L IA M
J A M E S L . M IL L E R
F R A N K L IN H . G A T E S
J O S E P H C. R O V E N S K Y
A R T H U R M. A I K E N
GEORGE
You know it is not my interest to pay
the principal; nor is it my principle to
pay the interest.— Sheridan.
......................................................$ 40,000,000.00
E. P U R D Y
H.
SAYLOR
B E N J A M IN E. S M Y T H E
Comptroller
T H O M A S R IT C H I E
Foreign and Trust Department Facilities
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
88
A CREDIT FILE THAT P A Y S
(Continued from page 16)
was entirely the banker’s fault and we
are paying the price fo r our mistake. A
bank should not be a free service proposi
tion and it behooves us to carefully elim
inate such suggestions from our adver
tising.”
at least two members o f the loan com
mittee besides the official making the
loan.
The farm situation in Jasper County,
they say, is fairly good. The farmer who
is as well cajhtalized as the ordinary
business man, is doing fairly well. The
efficient tenant is doing well. Crops are
about average. Farm relief agitation has
largely developed into a very reasonable
demand that the present conditions be
stabilized and that the farmer be insured
so far as possible against a return to the
ruinous conditions which existed fo r sev
eral years past. The more radical de
mands, still heard occasionally, come
mostly from operating farmers so heavily
in debt from buying their farms at boom
prices that relief can come only through
extraordinary prices, and from landlords
asking for rental returns on similar val
uations.
The Jasper County Savings carefully
analyze each account to determine the
profitable and unprofitable ones. In ad
dition, each teller has a list o f customers
with such notations as “ Accept no depos
its,” “ Habitual overdrafts,” “ W atch,”
etc. The bank is determined to run its
business profitably. In fact, out o f more
than three thousand accounts, officers say
there are less than forty that give them
trouble. “ Many times we have asked a
persistent overdrawer to close his ac
count, whereas it wouldn’t have occurred
to us to do that ten years ago,” they say.
Concerning methods o f obtaining and
holding new accounts, the bank’s officers
s a y : “ Every banker is continually using
every known method o f obtaining new
accounts.
Iowa bankers everywhere
spoiled their customers years ago, en
treating them to come and be served free
o f charge. The customer got the idea
that the banker must be making some
thing every time a check was cashed. It
As stated before, the Jasper County
Savings Bank is the oldest bank in Jasper
County. It was organized in 1869 as a
private bank by General James Wilson
and Albert Lufkin. In 1880 J. M. W oodrow became cashier and was president
from 1890 to 1919, the year o f his death.
It was incorporated as a savings bank in
1908. The Maytag interests bought con
trol o f the bank in 1925 and took over the
To illustrate this point, Mr. Bestor
tells about a customer who told him he
supposed he wTas doing the bank a favor
by letting them cash his cream checks.
Clark National Bank in the following
year.
At the present time, F. L. Maytag is
chairman; E. H. Maytag, president; L. B.
Maytag, vice president; F. P. Ross, vice
president; P. IT. Bestor, vice president;
A. E. Hindorff, cashier, and Lee E.
Brown, assistant cashier. Cashier Hin
dorff, who has been with the bank for
twenty-five years, is well known for his
State Association activities, having been
treasurer in 1925-1926.
Estate Tax Ruling
“ One point I wish to get across is that
there is no inheritance tax on insurance
paid fo r by the beneficiary. That has been
settled by the unanimous decision o f the
United States Supreme Court. When a
wife as beneficiary buys insurance on her
husband, she is protecting an interest
with just as perfect a right as she protects
her house against fire.” — John M. Bruce
in John Hancock “ Signature
Pride is founded not on the sense of
happiness, but on the sense o f power.—
Hazlitt.
Of pleasure those which occur most
rarely give the greatest delight.— E pic
tetus.
THE
Bureau of
Canadian
Information
HANOVER
NATIONAL
BANK
OF THE CITY OF NEW YORK
Established 1851
The Canadian Pacific Railway through its Bureau of
Canadian Information, will furnish you with the latest
reliable information on every phase of industrial and
agricultural development in Canada. In our Reference
Library at Montreal is complete data on natural re
sources, climate, labor, transportation, business open
ings, etc. Additional data is constantly being added.
Development Branch
I f you are interested in the m ining w ealth and in d u stry of
Canada or in the developm ent or supply o f in d ustrial raw m a
terials available from resources a long the Canadian P acific
R ailw ay, you are invited to consult this B ranch.
A n expert
staff is m aintained to in vestigate in form a tion rela tive to these
resources and exam ine d ep osits in the field. P ra ctica l in fo r
m ation is available as to special op p ortu n ities fo r developm ent,
use o f b y-p rod u cts and m arkets, industrial crops, p rosp ectin g
and m ining.
"A s k the Canadian Pacific about Canada’’ is not a m ere
advertising slogan. It is an intim ation of service— w ith
out charge or obligation— that the inform ation is available
and will be prom ptly forth com ing to those who desire it.
Capital
.
.
.
$5,000,000
Surplus and Profits . $26,000,000
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
CANADIAN P A C IF IC R A IL W A Y C O .
Department o f Colonization and Development
J. S. D E N N IS
C hief C om m issioner
W in d sor Station
M ontreal, Can.
89
kota Bankers Association, Potter County
Bank, Gettysburg; Rice.
*Kopperud, A., president, Oldham National
Bank, Oldham; Rice.
Starring, Geo. A., secretary, South Dakota
Bankers Association, Huron; Rice.
North Dakota
Bank News
^Delegate.
Officers North Dakota Bankers
Association
NEW S AND V IE W S
P resid en t................................. G. H- L e ick
(Continued from page 20)
V ic e P resid en t and Chairm an E x e cu
tive C ou n cil................ M. C. B ach elier
Grand F orks
T rea su rer ........................ J.
M addock
G. H . L E IC K
P resid ent
I*
H egge
S ecreta ry_____________"W. C. M a cfa d d en
F argo
N o rth D ak ota N ew s
Beatrice E. W est has been appointed
bookkeeper o f the Farmers State Bank
o f Mandan.
Wm. G. Schucht has been elected cash
ier o f the Farmers State Bank, Drake.
H. H. Ekeland has been elected presi
dent, and Ernest Y. Pooley, vice presi
dent o f the Esmond State Bank.
H. A. Gollnick has been elected cash
ier o f the Farmers State Bank, Great
Bend.
Anna Nelson has been appointed book
keeper o f the Farmers State Bank,
Harvey.
Ruth Malone lias been appointed book
keeper o f the Moffit State Bank.
Florence Bogen has been appointed
bookkeeper o f the First State Bank,
Reeder.
John D. Wilson has been appointed
assistant cashier o f the First State Bank
o f Regan.
Adds Savings Department
The Bottineau, North Dakota, National
Bank has added a savings department to
its business. The department has been
added, it is said, because o f the demand
among customers o f the institution.
No Exception
No exception was made by the legisla
ture to the law that banking associations
shall set aside ten per cent o f their net
profits as surplus until the surplus equals
20 per cent o f the capital stock, A ttor
ney General George F. Shafer has held
in an opinion to Gilbert Semingson, state
bank examiner fo r North Dakota.
Semingson inquired on behalf o f a
bank the stockholders of which had volun
tarily subscribed $1,000 in surplus upon
its organization. In view o f this volun
tary subscription the bank wished to know
W . C. M A C F A D D E N
Secretary
if it could not pay out all its net profits
as dividends.
V ictor Smith, assistant to the presi
dent o f the Omaha National Bank, has
sent us a definition o f a specialist, which
is especially appropriate in this day
when we are surrounded by specialists in
every line. “ A specialist, accoidng to
Mr. Smith, “ is a man who knows more
and more about less and less until lie
knows everything about nothing.’’
To Have New Bank
Lucius Teter, president o f the Chicago
Trust Co., has announced the merger of
the National Bank o f Commerce with liis
institution, making the new capitaliza
tion o f the Chicago Trust Company $2,400,000.
Edwin L. Wagner, president o f the
National Bank o f Commerce, will become
vice president and a director o f the Chi
cago Trust Company. Charles W . Higley, a director, will become a director in
the Chicago Trust Company, and Ralph
N. Ballou, vice president and cashier, and
H. B. Ahrensfeld, assistant cashier, will
To California
become A7ice president and assistant cash
C.
A. Jeglum, o f Adams, North Dakota,ier, respectively, o f the merged bank.
well known in Walsh county banking cir
cles, has moved with his family to San
The Exchange National Bank of Tulsa,
Diego, Cal., where they will make their
Oklahoma, A\Thich is known as “ the oil
future home.
well o f America,” believes that it is
Mr. Jeglum Avas first associated with a
justly entitled to this name, as a steady
brother, C. J. Jeglum, in banking busi
flow o f oil was discovered recently Avhen
ness at Adams. About fifteen years ago
workmen drilled through a layer o f shale
the latter moved to California, whereupon
Avhile excavating fo r the new 24-story
C. A. affiliated himself Avith the State
Addition to the Exchange National Bank
Bank o f Edinburg, first as assistant cash
uilding.
ier and then as cashier. When the Edin
(t has been suggested that Avhen the
burg Bank underwent a change in owner
new building is completed that a fountain
ship, Mr. Jeglum returned to Adams and
located in the great connecting lobby will
acted as cashier o f one o f the two banks
spout oil produced beneath the building.
until they merged their interests tAVO years
ago.
George J. Schaller, president o f the
Iowa Bankers’ Association, after his re
From North Dakota
turn from the American Bankers’ conven
The following persons from North Da tion, in making a comparison o f agricul
kota attended the recent A. B. A. con tural conditions in the South with those
vention at Houston :
in the Middlewest, said: “ Everywhere
*Irish, Fred A., vice president, First Na
you Avili find some complaint o f price dis
tional, Fargo; Rice.
crimination against the producer, espe
*McFadden, W. C., secretary, North Dakota
Bankers Association, Fargo; Rice.
cially o f agricultural and farm products,
but I believe it is being adjusted here as
*DeIegate.
rapidly as anywhere and I have seen no
place in the South Avhere honest effort
From South Dakota
and close application brings any larger
The follow ing persons from South Da or surer returns than here in Iowa.”
kota attended the resent A. B. A. con
vention at Houston :
One of the latest of modern conven
*Beebe, M. Plin, president, Bank of Ips iences to be reported to us, is the private
wich, and wife, Ipswich; Rice.
*Griffith, Harry M., president, South Da elevator leading direct to the neiv offices
Alexander, North Dakota, without a
bank since A pril 3, 1924, probably will
have a new bank, according to C. E. Bur
dick, cashier o f the First State Bank in
Corinth, Williams county, who has an
nounced that his bank has purchased the
building formerly occupied by the First
National Bank and plans to open a finan
cial institution in Alexander. The charter
o f the Corinth Bank has been transferred
to Alexander, Mr. Burdick declared.
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
90
o f the P. W . Chapman & Co. in the Bank
ers building, Chicago.
The offices occupy practically the en
tire third floor o f the building.
John G. Lonsdale, president o f the Na
tional Bank o f Commerce o f St. Louis,
was elected second vice president o f the
American Bankers’ Association at Hous
ton, being unopposed, when W . C. W ilk
inson o f Charlotte, N. C., withdrew in his
favor.
Mr. Lonsdale was form erly president
o f the national bank division o f the as
sociation. Two years hence Mr. Lonsdale
will be elected president o f the Ameri
can Bankers’ Association.
ISHPODAR BROADCASTS SOME
DO’S AND DON’T’S
(Continued from page 17)
prickest’ thy finger when at last thou
drawest them out, and blood-poison setteth in.
21. W oe unto him who teareth a deposit
slip in small pieces and casteth it not into
the waste-basket, but scattereth it about
over the floor.
The Nicotine Curse
22. And woe unto the customer who
cheweth tobacco, yet goeth not to the back
door when occasion ariseth.
23. Blessed is lie who payeth his note
when due, keepeth a goodly balance, hath
confidence in his bank and praiseth it
openly among his neighbors, doeth his
banking in banking hours, and keepeth
his stubs withal; fo r he is a man among
ten thousand, and his banker shall sing
loud hosannas in his name.
24. Keep thy books in balance and thy
note-case clean, and thou shalt be re
classified by the bank examiner.
25. Let him who carrieth no overdrafts
in his cash-box be the first to criticize his
competitor’s statement.
26. The favor thou grautest to the
stranger by cashing his check shall be re
turned to thee with interest— in the form
o f protest fees.
The Bank ofJonesville Buys Bonds
* | 'HE Bank o f Jonesville is always buying bonds, for it has found a
tremendous force for increased business in every department o f its
bank through selling bonds— not to mention the profit from the sale
and resale o f the securities themselves.
There was a time when this bank did
not feel the necessity o f an investment
service for its customers, but that was
it. The number o f banks that are
before investing in bonds had become
popular.
adding bond investments to their
services to customers is fast increasing.
Today the Bank feels that its bond
sales are no small factor in its satis
factory growth and the constant
widening o f the territory it serves.
What one bank has done, other banks
can do. In fact, other banks are doing
A n d today, bonds are being sold in
every community. It follows that local
banks are going to profit by taking
advantage o f this fact.
W e are giving particular attention to the needs of the
bank that wishes to establish a profitable Bond Depart
ment. W e invite you to write us about your situation.
ROVERS
NATIONAL B A N K
TRU5T65AVTNG5 BANK
Union Stock Yards
* Chicago
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
91
IOWA
SECTION
Officers Iowa Bankers
Association
P resid en t
G eorge J. Schaller
Storm Lake
V ic e P resident....C has. T . Schenek
R ed Oak
T rea su rer_______V . 0 . B onesteel
S iou x C ity
GE OR GE J. S C H A L L E R
President
S ecreta ry ....................... Frank W arner
Des M oines
W ell Known Banker Dies
Mr. Dagobert A. Gehrig, president o f
the United State Bank, Dyersville, Iowa,
passed away at his home after a lingering
illness o f a year’ s duration. Mr. Gehrig
was one o f the most widely known and
popular business men o f Dyersville and
the news o f his death was received with
keen regret by Dyersville people and resi
dents o f that vicinity. He was 75 years o f
age.
Mr. Gehrig had not been in the best of
health fo r some time, suffering from a
complication o f ailments. About a year
ago he submitted to an operation in the
hospital at Rochester, Minnesota, and for
a time he appeared to be improving and
there was hope o f an ultimate recovery,
but he later suffered a relapse and his con
dition has been critical fo r several weeks.
Under Mr. Gehrig’s able management
the United State Bank has developed into
one o f the most substantial banking insti
tutions in eastern Iowa. A fter many
years as cashier, the board in recognition
o f his untiring efforts in behalf o f the
institution elected him as president, in
which capacity he continued until the time
o f his death. He was succeeded as cashier
by Henry F. Kremer. Several years ago
the bank erected the handsome new struc
ture, which stands as a monument to the
success and accomplishment o f the bank’s
officers, in the activities o f which Mr.
Gehrig was the chief factor. The bank
today has a business totalling over a mil
lion and a quarter.
Howard Bankers Meet
The Howard County Bankers’ Associa
tion held their meeting and annual election
o f officers recently at Cresco, Iowa.
A representative from every bank in
the county, and six bankers from other
counties, were in attendance.
At 6:30, a dinner was served at Johnny
Mac’s, after which the following officers
were elected : President, J. B. Gray ;
cashier o f the Exchange State Bank, Lime
Springs; vice president, R. A. Moore,
cashier o f the People’s Savings Bank, of
Elma; secretary, Asa A. Farnsworth, as
sistant cashier o f the Cresco State Bank,
re-elected; treasurer, J. A. Dostal, Bohe
mian Savings Bank, Protivin.
Fred J. Figge, president o f the Ossian
State Bank, Elmer Rinigeon, cashier o f
the First State Bank, Ridgeway, Roy St.
John, cashier o f the First National Bank,
Riceville, A. G. Dunton, assistant cashier
o f the First National Bank, o f Riceville,
C. F. Bartlett, president o f the Riceville
State Bank, and Charles Potier, cashier of
the Riceville State Bank, were the guests.
Cashier Resigns
C. E. Watts has resigned his position as
cashier o f the Commercial Savings Bank,
Ames, Iowa, a position he has held for
four years.
Although Mr. Watts makes no definite
announcement o f his plans, he is leaving
Ames fo r a visit with his parents at his
old home in Hedrick. Later he may go to
Minnesota to superintend the cutting of
timber on lands which he holds there.
Elected President
Henry W . Huiskamp was elected presi
dent o f the State Central Savings Bank at
a recent meeting o f the directors. He will
succeed the late Judge William Logan.
Mr. Huiskamp was the senior member o f
the board o f directors o f the bank.
Mr. Huiskamp is president o f the Huis
kamp Bros. Co., and is one o f the influen
tial business men o f Keokuk. He is well
versed in business and banking and his
election as president o f the bank will mean
that he will bring to that office a wealth o f
experience gained in the years of his busi
ness connections in Keokuk.
Becomes Cashier
R. C. Brogmus, formerly o f Alta but
lately with the Toy Bank at Sioux City,
has removed to Fonda, Iowa, where he be
comes cashier o f the First National Bank,
succeeding the late Irving Brubacher,
whose death occurred recently.
Mr.
Brogmus was formerly auditor fo r the
Toy system and has many friends in
Storm Lake.
Bankers Optimistic
A. C. Smith, president o f the City Na
tional Bank o f Clinton, Iowa, and for
three years a member o f the executive
council o f the American Bankers Associa
tion, has recently returned from the an
nual meeting o f the association at Hous
ton, Texas. He says that he has found
strong optimism among the bankers from
all parts o f the country.
They are especially optimistic on agri
culture, as they think that the farmers
will enjoy satisfactory crop returns this
year, either through large yields or rising
prices. The total agricultural income this
year is expected to be above the average
fo r recent years. The price levels are ap
proaching the levels o f other commodities,
is the opinion o f the bankers from the
large agricultural centers.
It was the opinion at the meeting that
the bond o f union between the farmer and
the banker cannot be too strong, and
therefore the news that 1928 will be a
most satisfactory year for farmers, ex
cluding adverse weather conditions, was
welcome.
It was brought out at the meeting that
the farmer is using more business in his
efforts and is gradually working out his
own problems.
Buys Buxton Bank
Announcement has been made by the
Peoples Trust and Savings Bank of Oskaloosa, Iowa, that it has bought the assets
and assumes the liabilities o f the Buxton
Savings Bank o f Buxton, and will pay
all depositors and stockholders in full.
Action o f the smaller bank in selling
its business has been brought about by
reason o f the slump in coal mining opera
tions, the principal industry in the town
in which the Buxton bank has done busi
ness.
Cashier Resigns
A. H. Fortune has tendered his resigna
tion as cashier o f the Davis County Sav
ings Bank o f Bloomfield, Iowa. This has
been in contemplation fo r some time, but
has awaited the rearrangement o f the
working force o f the bank. Mr. Fortune
states that he has been in banking work
fo r nearly thirty-three years, and has de
cided to take a rest. He began his bank
work, associated with J. R. Wallace, in
the State Bank, in 1895, and in 1900 was
one of the organizers o f the Savings Bank.
He still remains one o f the directors and
retains his stock in the bank.
Mr. Fortune has been a Bloomfield busi
ness man continuously fo r the past fifty
years.
Honor Roll Bank
The Mitchell Savings Bank, of the town
o f Mitchell, Iowa, is distributing to its
friends and patrons a statement folder
showing membership on the roll o f honor
o f American banks. To acquire place on
the roll o f honor, a bank must first have
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem ber 1927
Resources Exceed Eleven Million Dollars
accumulated surplus and profits in excess
o f capital. The laws o f the nation, and
states as well, resognize that surplus is a
protection to depositors, but the usual
maximum imposed legally, is twenty per
cent o f the capital. Roll of honor banks
have, through their own initiative, in
creased this maximum four times beyond
the law’s requirements.
E stab lish ed 1874
County Meeting
Since
1874
B ank
has
keeping
with
the
this
been
apace
growth
o f the great b u si
ness
territory
it
serves and today
offers the m o s t
com plete and sat
isfactory
service
in its entire hist o r y,
together
with the same ab
Bankers Elect
solute safety that
H. A. Bruns, cashier o f the Beaver Sav
ings Bank, was elected president o f the
Boone County Bankers’ Association at
their annual meeting in Boone recently.
The business session was preceded by a
supper held in one of the tea rooms there.
G. C. Carlson o f the Farmers Savings
Bank o f Madrid was elected to the ex
ecutive committee.
The other officers and members o f the
executive committee elected were as fol
lows :
Vice president— Claus Heldt, o f Ogden.
Secretary and treasurer— T. R. Duck
worth, Boone.
Executive committee— Carl Roberts,
Boone; G. C. Carlson, Madrid; Walter
Rosen, Ogden.
G. C. Carlson o f Madrid was the out
going president.
has characterized
it through all the
years o f its suc
cessful operation.
OFFIC E RS
C H A R LE S E. P E R K IN S , Chairman o f Board
E. W E B B L E S , President
J. G. W A LD SC H M ID T , V ice President
C. T. SIM MONS, V ice President
R. L. B UN CE, V ice President
L. M. W IL SO N , V ice P resident
E LM E R R A U E N B U E H L E R , V ice President
F. J. N O R T O N , V ice President
L. T. P A N T H E R , Cashier
S. R. G R A N T , Assistant Cashier
L. P. B ECKM AN . A ssistant Cashier
J. S. STU B B L E F IE L D , Assistant Cashier
R A Y H U M PH R E Y , M anager Bond Departm ent
H. A . H E IL , Trust Officer
T. H. W IL SO N . A uditor
FIRST™sr wmIBANK
A6
MEMBER
The Iowa County Bankers’ Association
met in North English, Iowa, recently, and
elected the following officers: Henry
Wahl, Victor, president; E. J. Johnson,
Marengo, secretary; F. W . Franey, Ma
rengo, treasurer. A. H. Evans o f W illiamsburg was chosen as a member o f the
advisory committee. Dinner was served
at the Van Fleet hotel at 7:30, with the
business sessions in the Masonic hall.
Those in attendance were:
A. H.
Jones, Ed Lewis, o f W illiamsburg; E.
J. Johnson, Mr. Lindenmeyer, Ole Olson,
E. J. Hoepner, o f M arengo; Everett
James, Conroy; Henry Wahl, J. J. Roushar, Miss Grace De Decker, J. M.
Dusterhoft, V ictor; V. P. Culen, Parnell;
E. D. Baird, W . S. Baird, Vaughn Ellett,
Hugh Harrington, W . C. Carson, S. S.
Swain, R. S. Ferris, Fred Gilmore, E. G.
Brown, North English.
FEDERAL RESERVE S Y ST E M BURLINGTON IA.
At Lamont
Mr. Geo. L. Hanson o f Waterloo is the
new assistant bank cashier at the Farmers
State Bank o f Lamont, Iowa. Mr. Han
son is a former Oelwein boy, has had sev
eral years’ experience in the banking busi
ness and comes highly recommended. He
was formerly associated with the Savings
Bank at Oran.
Crawford Bankers Meet
The regular quarterly meeting of the
Crawford County Bankers’ Association
was held recently at Schleswig, Iowa. J.
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
93
J. Miller and Geo. Sievert o f tlie Com
mercial Bank, C. D. Saunders o f the First
National Bank, and H. E. Qualheim o f the
Crawford County Trust and Savings
Bank, were those who attended from Den
ison. Twenty-five members representing
nine of the banks o f the county were at the
meeting and all enjoyed a banquet at 6 :30.
The meeting was addressed by Mr.
Jacobs o f the Bankers’ Research Bureau
o f Des Moines, who gave an interesting
and educational address.
New Bank
Emmet county, Iowa, is to have a new
bank located at Estherville.
Stockholders o f the bank met and
elected the following directors: Henry
W . Mahlum, A. J. Rhodes, L. L. Bingham,
W. D. O’Brien, Wayne C. Currell, Charles
C. Kuning, and N. H. McKerral.
Henry W . Mahlum is to be president,
Wayne C. Currell, cashier, and N. H.
McKerral, vice president.
The institution is to be known as the
Emmet County State Bank, and will have
a capital stock o f $50,000 and surplus o f
$100,000. All o f the stock has been sub
scribed for.
The new bank will be located on the
corner o f Lincoln and 7th streets, south of
the Gardston hotel, and will open fo r busi
ness as soon as the room is redecorated,
fixtures installed, and a substantial vault
constructed.
A Second “ Barney”
Fred Wray, cashier o f the Pioneer Na
tional Bank, claims the Waterloo record
for one day’s drive by auto, which a short
time ago was accredited to Mr. and Mrs.
W . E. Florey, with their report of 458
miles in 14 hours.
Mr. Wray, accompanied by his son,
Dale, drove to Minneapolis and returned
the same day, via Albert Lea and Clear
Lake, a total distance o f 524 miles, in
elapsed time of 18 hours and driving time
o f 14 hours.
W ray left Waterloo at 6 a. m. and re
turned at 12 midnight. He drove without
relief.
which he regards as highly desirable prop
erty, regardless o f temporary conditions
in land prices.
divided into several payments at various
times, but is all payable within 20 years.
Buys School Bonds
President George J. Sehaller of the
Iowa Bankers Association recently ap
pointed three prominent Davenport bank
ers as chairmen o f important committees
o f the state association and named three
other local bankers as members o f big
committees.
Ed Kaufman, president o f the Amer
ican Commercial & Savings Bank, was ap
pointed chairman o f the publicity com
mittee. Frank Yetter, vice president of
the American Commercial, was named
The Merchants National Bank o f Cedar
Rapids, Iowa, at a meeting o f the Olm
Consolidated school board held recently,
purchased the school bonds fo r the erec
tion o f a new school building fo r the Olin
Consolidated School District.
The amount o f the bonds was $110,000,
the amount voted at the last bond elec
tion, and is divided into eleven bonds of
$1,000 each bearing four and a quarter
per cent interest. The total amount is
I. B. A. Appointments
ES M OINES, center
for many of the so
cial, political and commer
cial activities of the state,
owes responsibilities to the
people ol Iowa to serve
them well. As Des Moines
correspondent for many
financial institutions in this
state, this bank undertakes
its responsibilities with an
intent and purpose to fulfill
and meet them fully.
D
Buys Farm Land
Peter Lamb and associates, o f Mapleton,
Iowa, recently purchased 14 farms, all in
volved in one transaction. The farms pur
chased by the Mapleton men are located
mostly in Monona and Woodbury counties,
and formerly were part o f the extensive
holdings o f C. L. Voss, o f Denison.
The Mapleton syndicate which bought
14 farms in one transaction feels con
fident that there is a turn fo r the better
on farm lands and that the deal will re
sult in both investment and speculative
profits. Mr. Lamb is president o f the
First National Bank o f Mapleton and has
extensive individual holdings o f land
BANKERS TRUST CO.
BAN K
Cor. 6th and Locust Sts., Des Moines
Capital $1 ,000,000.00
Surplus $ 2 0 0 ,0 0 0 .0 0
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
94
D IRECTORS AND
OFFICERS
Successful
Conservative Banking
‘4 k
Statement of Condition
of
T H E C IT Y N A T IO N A L B A N K
ALFRED G. SMITH,
Chairman
ALFRED C. SMITH,
President
G. L. CURTIS,
Vice President
President. Curtis
Companies, Inc.
G. W. DULANY, JR..
President, Eclipse
i-umuer Co.
President, Climax
Engineering Co.
H.
W. SEAMAN,
Chairman Clinton Wire
Cloth Co.
M.
J. GABRIEL,
President Gabriel
Lumber & Fuel Co.
J. PETERSON,
J. O. STTAFF,
State Senator
Farmer and Live Stock
D ealer
B. M. JACOBSEN,
President
Clinton Thrift Co.
of Clinton, Iowa
E. .1. C U R T IS .
October 10, 1927
R ESOU RCES
Time and Demand L o an s.............. $5,766,218.34
381,944.25
U. S. B on ds..........................................
Stock in Federal Reserve Bank. .
19,500.00
Real Estate and Fixtures................
92,913.02
Cash and Due from Banks and
U. S..................................................... 1,096,946.08
$7,357,521.69
L IA B IL IT IE S
C a p ita l................................................... $ 300,000.00
350,000.00
Surplus .................................................
Undivided Profits.............................
188,249.08
Circulation ...........................................
300,000.00
Deposits ............................................... 6,219,272.61
Vice President Curtis
Bros. & Co.
C. A. ARMSTRONG,
Pres. C. F. Curtis
Company, Inc.
W. R. SMITH,
General Manager
Clinton Corn Syrup
Refining Co.
A. P. BRYANT,
Manager of Operation«
Clinton Corn Syrup
Refining Co.
F. H. VAN ALLEN.
V. P. and Sec’y.
J. D. Van Allen & Son
Inc.
H. S. TOWLE,
V. P. and Treas.
Towle & Hypes Co.
O. P. PETTY, Cashier
J. H. NISSEN,
Assistant Cashier
H. G. KRAMER,
Assistant Cashier
$7,357,521.69
head o f the bank taxation committee and
I. J. Green, cashier o f the First National
Bank, was appointed chairman o f the ag
ricultural committee for the fifth consecu
tive time.
A. F. Dawrson, president o f the First
National, was appointed member o f the
bank analysis committee; Wm. Heuer,
president o f the Union Savings, member
o f the legislative committee, and Ray Nyemaster, vice president o f the American
Commercial, member of the rivers develop
ment committee.
Banker Dies
C. A. Kendall, president o f the Farmers
State Bank, o f Earlville, IoAva, died re
cently from heart trouble. Besides being
president o f the bank at that place, Mr.
Kendall was a member o f the board o f
directors o f several other banking insti
tutions and also was head o f the Kendall
drug store. He is survived by his widow,
his aged mother, one daughter and two
brothers.
Elected to Board
F. C. Hubbell, Des Moines capitalist
and member o f the civil service commis
sion, was recently named to the board o f
directors o f the Iowa National Bank and
the Des Moines Savings Bank and Trust
Company.
The election took place at
the regular meeting o f the directory board.
The Hubbell interests recently pur
chased a block o f 700 shares of Iowa Na
tional stock fo r $100,000 or about $143 a
share, according to reports in business
circles.
Merger
A •merger was effected in Crawfordsville, Iowa, recently, whereby the Peoples
Savings Bank takes over the business of
the First Savings Bank and the business
o f the two banks will be transacted in the
future from the Peoples’ Savings Bank
building.
All the help that was employed in both
banks will be retained for the present.
Represents Northern Trust
C ity National Bank
C L IN T O N IO W A
X orth w estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
The Northern Trust Company o f Chi
cago has announced the appointment of
Robert Root as its bond department repre
sentative fo r the state o f Iowa. His office
will be located in the Insurance Exchange
building, Des Moines.
Mr. Root was born in Iowa, attended
the state university at Iowa City and for
the last three years, be lias made his home
in Des Moines.
The Northern Trust Company is one of
Chicago’s oldest banks. It is prominent
in the commercial banking field, and is
one o f the largest retail distributors o f in
vestment bonds in the middle west, particular emphasis being laid on municipal
bonds.
95
M EM BER
FEDERAL RESERVE
ORGANIZED
I8 77
T o serve better, w ith m o r e than
ordin ary
personal interest,
correspondent
been
the
aim
banks
of
our
has lon g
the
Cedar
R a p i d s N a t i o n a l official o r g a n
ization.
And
it
is
backed by
these
sam e
aim s,
a stron g, stable
in
stitution, th a t a c c o u n ts
for o u r
satisfied
list of
correspondents
Glenn M. Averill, Pres.
E. M. Scott, Vice Pres.
C.
Kuning. V. P. and
Cashier
Van Vechten Shaffer,
Vico Pres.
Geo. F. Miller, V. P.
and Trust Officer
Frank Filip, Vice Pres.
Assistant Cashiers
Peter Bailey
Marvin It. Selden
Bertha M. Wolf
Geo. \V. Swab
Maud tv. Carpenter
Walter Allison
1
K. I). Brown
«i O. K . Kearney i—t.
C ed a r T^apids National Dank
Cedar T^a/pids, Io\0a
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
96
The Bond Market
The bond market continues to respond
to the strength o f investment demand.
Legal rails, railroad bonds once regarded
as second-grade, industrials, foreign bonds
and municipals all have shared in the
steady upward creep o f prices which have
been little affected by firm call money,
heavy brokers’ loans, and stock market
uncertainty.
Of some importance in connection with
the investment market is the bettered posi
tion o f farmers in the wheat and corn
states and in the ctoton belt. While it is
doubtful whether the gains made have
been as great as is popularly believed in
non-agricultural circles, there is no ques
tion that things are better. This improve
ment will to some extent be reflected in
consumption, but it is likely that its main
effect will be a reduction o f the farm debt
by paying off to banks obligations not se
cured by mortgage, by payment o f
amounts delinquent on mortgages, and to
some extent by anticipation o f future in
stallments on mortgages, where this can be
done under the terms o f the contract.
While the amount out o f the aggregate o f
funds thus released which will seek other
channels o f employment may not be rela
tively large, it may well be enough to
uake itself felt in the investment markets.
- From Bulletin, National Bank of Com
merce, New York.
P.
M .
ir"
Banker
t r ib u n e t o w e r
R E E D
Associates
J £ |j|j
Business Vastly Improved
Chas. Shade, president o f the First Na
tional Bank o f Rock Rapids, Iowa, has
the following to say regarding business
conditions in his section o f the state:
“ Business in northwestern Iowa during
the last sixty days has showed a very
marked change fo r the better. In 1926
it was a hard proposition, but we man
aged to struggle through. W e harvested
this year a splendid crop o f small grain,
and we are now picking corn which I
think will average from 40 to 50 bushels
per acre here in northwest Iowa. I am
hopeful that coi-n will sell from 70c to
75e a bushel. This will put the banks in
our section o f the state in good financial
condition.”
C H IC A G O
Meet in Boone
The Boone County Farm Bureau were
hosts recently to a most .interesting
Farmer-Banker-Press meeting held at the
Elks home in Boone, Iowa. The meeting
was attended by about two hundred peo
ple comprising the bankers and newspa
per men, in and around Boone county, the
Boone county officers, the Farm Bureau
officers and both the county and township
leaders.
The keynote o f the meeting was ex
pressed in the slogan on the program “ I f
we all pull together we can win,” and the
whole spirit o f the meeting was one o f co
operation between all Iowa people in an
effort to forward agriculture interests.
T h e State C en tral S a v in g s B a n k
Keokuk, Iowa
^aPital .......................................................................................................$ 200,000.00
Surplus and Undivided Profits................................................................
334, 115.53
Deposits ..................................................................................................... 3,102¡651.48
W I L L I A M LOG AN , President
L. J. M O N TG O M E R Y , V ice P resid en t
W . A . LO G AN , V ic e P resid ent
C. J. B O D E , Cashier
L . J. W O L F E , A sst. Cashier
G. N. D U E R K O P , A sst. Cashier
E. A . E B E R S O L E , A sst. Cashier
ACCOUNTS OF B A N K S A N D B A N K E R S IN V IT E D
B A N K ENVELOPES
I
Kraft and Leatheroid envelopes for
I
I
W e specialize on high grade
Banks and Investment Houses.
|
|
W e invite your inquiries for envelopes of all kinds, including
everything from small passbook jackets to the larger size envelopes for
mailing or filing.
|
I
f
Midway
Q u a lity Park E n v e lo p e C o.
St. Paul, Minn,
f
TiiiiiiiiiiiUiiiiiiiiiiiiiiiiiiiuiiiiiiiiiiiiiiiiiitiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiitiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiuiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii^
1
A t your service
in Eastern Io w a
and
Humility is often a feigned submission
which we employ to supplant others. It
is one o f the devices o f pride to lower
us to raise us; and truly pride transforms
itself in a thousand ways, and it is never
so well disguised and more able to de
ceive than when it hides itself under the
form o f humility.— LaBochefoucaulcl.
*
W e s te r n Illinois
PeoplesTrusè&SavingsBa^
CLINTON, IOW A.
»
Remember it this way-"PEOPLES TRUST
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
Goes with Hart-Parr
Glenn Satterlee, assistant cashier o f the
Security Trust & Savings Bank, Charles
City, Iowa, has resigned, effective Novem
ber 1st, to take a position in the credit
and collection department o f Hart-Parr
Company.
In January, 1920, lie began working for
the bank as a bookkeeper, progressing
through the various stages until in Janu
ary, 1924, he was elected assistant cash
ier, which position he has held ever since.
His bank training equips him fo r his new
position in the Hart-Parr organization.
The sea remembers nothing; it is fe
line. It licks your feet— its huge flanks
purr very pleasantly fo r you; but it will
crack your bones and eat you, for all
that, and wipe the crimsoned foam from
its jaws as if nothing had happened.—
Holmes.
97
New Building
O n N o v e m b e r 10th con tra cts w ere let
f o r the b u ild in g o f a p r a c tic a lly new F ir s t
N a tion a l B ank , a c c o rd in g to an n ou n ce
m ent m ade re ce n tly b y J. A . B ra d ley , head
o f the F ir s t N a tion al, an d also the Io w a
T ru st an d S a vin g s B a n k s o f C en terville,
A Record Of
Accomplishment
Io w a .
The new b a n k on the n orth side o f the
sq ua re that w ill take the p la ce o f the p r e s
ent F ir s t N a tion a l is b e in g bu ilt w ith a
v ie w to a n ticip a tin g the needs o f the city
f o r 20 years. I t is to be the la st w ord
in ba nk co n s tru ction and w ill be e q u ip p e d
w ith the finest obtain a ble vau lts an d sa fe ty
d e p o s it fa c ilitie s w ith room f o r 2,000 24in ch sa fe ty d e p o s it boxes.
T he fa c e o f the ba nk is to be o f b ea u ti
fu lly carved B e d fo r d stone ex ten d in g tw o
stories in height. T he flo o r o f the bank,
w hich is n o w a b ove sidew alk level, w ill be
low ered an d a basem ent an d tw o -sto ry
a d d itio n w ill be a d ded to the structure,
m a k in g it 100 fe e t in length in stead o f the
p resen t 80 fe e t. A m ezzanine floor w ill
be ad ded to the in te rio r o f the bank
p r o p e r.
O ffices on the secon d floor o f
the ba nk b u ild in g w ill rem ain m uch as
T e n Y ea rs A g o O n e O ffice
T o d a y O u r O w n B u ildin g
A n d B ran ch Sales O ffices
In Seven Cities
W e C on trol and M an age
P u b lic U tilities
S u p p lyin g E le ctricity A n d Gas
In
P rosp erou s C om m unities
W e A ls o
F in ance A n d D istribute
T h e Securities O f
G o o d Industrial C om panies
A fte r T h o ro u g h In vestiga tion
‘ For Over Ten Years— All Your M oney— All The Tim e— On 1 im e’
W .B, D S M Æ
IN C O R P O R A T E D
9
A U G U S T 31. 1917
Controlling And Managing Public Utilities
th ey are at the presen t tim e.
Will Not Merge
W in te rse t, Io w a , w ill n ot have a “ C iti
zens and M a d ison C ou n ty N a tion a l B a n k ”
as ad vertised som e tim e a go. The m erger
Sioux C ity
Service
ß io u %
W e invite the business of
Banks and Bankers who
seek particular care and
attention in their Sioux
City connection.
Officers
^ W A T IO A ^
^
^
J. L. Mitchell, President
I* H . Henry, Vice Pres,
and Chairman of the
Board
H . A. Gooch, Vice Pres.
O. I). Pettit, Cashier
Frank K . Kirk, Asst.
Cashier
John P. Hainer, Asst.
Cashier
L . M. Ashley, Asst.
Cashier
Geo. J. N. Smith, Asst.
Cashier
Capital
j
M
»
$L000M00.00
¿ s /o u x
¿ /O U X C \
Mm
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
98
of' the tw o stron g banks, the C itizens N a
tion a l an d the M a d ison C o u n ty State
B ank, w ill n ot be consum m ated. The final
statem ents o f both banks w ere m ade b e
fo r e the p r o p o s e d m erg er as req u ired b y
the b a n k in g laws, and then w hen the da y
a p p ro a ch e d f o r the actu al m erger, the
deal w as called oft.
FIRST
«
- NATIONAL ' »
BANK El
B a n k s M e rg e d
IN T H E U N ITED S T A T E S
A Heritage
that guides our service
O n F ebru ary 2 6 th ,
1 8 6 3 , one day
after A b ra h a m L in co ln signed the N a
tional B ank A c t, an application fo r a
charter
BANK
for
the
F IR S T
N A T IO N A L
o f D A V E N P O R T reached the
T reasury D epartm ent in W ash in gton .
O n June 2 2 d o f that same year, the
application was approved and on June
2 9 th the F IR S T N A T I O N A L B A N K o f
D A V E N P O R T was opened for business.
It was the f i r s t N ation al Bank opened
in the U n ited States.
A n d fo r tw o d a ys
it e n j o y e d t h e u n i q u e d i s t i n c t i o n o f b e
in g th e o n l y b a n k in th e w h o le c o u n t r y
o p e r a tin g u n d e r th e N a tio n a l B a n k A c t.
T h is glorious heritage o f being the
f i r s t N a tio n a l B ank in the U nited States
is a constant inspiration to us in our
efforts to offer y o u a B anking Service,
broader
in
vision ,
bigger
in
ideals,
greater in purpose— progressive, alert,
enterprising.
P e e lin g that there is h a rd ly ro o m in
G alva, Io w a , f o r tw o ba nk s and that the
com m u n ity w ou ld be served better b y one
la rge in stitu tion , a m erg er w as effected
recen tly o f the F irst N a tion a l B a n k and
the G alva State B ank. T he G alva State
B a n k ta kes o v e r th e a ccou n ts, n o te s and
p a p e r o f the F irst N a tion al. A t the last
statem ent o f the F irs t N a tio n a l its r e
sou rces w ere g iven as $250,000 and the
G alva State B a n k show ed $350,000. The
n ew in stitu tion w ill thus have about
$600,000 resou rces, $83,000 in ca p ita l and
surplus.
N ew in P e r r y
A t a m eetin g o f the stock h olders held
recen tly at P e r ry , Iow a , a ba n k w as f o r
m a lly orga n ized u n der the nam e o f the
P e r ry State B ank.
J . C. B rya n , p rom in en t P e r ry ca p ita l
ist, w ill be the p re s id e n t; E d w a rd P . D ills,
o f P e rry , v ice presid en t an d N. P . B lack,
o f M in b u m , cashier. T he la tter w ill m ove
to P e r r y an d assu m e a c tiv e m a n a gem en t
o f the n ew in stitu tio n . H e w ill r e ta in his
in terests in the D a lla s C ou n ty S a vin g s
B a n k an d w ill a ct as a d ir e c to r.
T he
officers nam ed, togeth er w ith D r. W . A .
S eid ler o f Ja m a ica , H a n s M eier o f B ou
ton and E d w a rd K a u sk y , o f n ear P e rry ,
w ill com p ose the d ire cto ry b oa rd .
The officers have leased the room and
pu rch ased the fixtu res used b y the P e r ry
N a tion a l B a n k an d w ill ca rry on the bu si
ness o f that loca tion . The new bank w ill
be ca p ita lized at $50,000, w ith $10,000
surplus. T he ca p ita l stock w as o v ersu b
scribed som e tim e ago.
C h arter Is su e d
A ch a rter w as issued re ce n tly to the
F ir s t S tate B a n k o f B ritt, Io w a , b y the
state b a n k in g depa rtm en t.
C. H . M acN id er is presid en t, E . A . C outer, vice
p resid en t, and Z. D . Ivoons, cashier.
The in stitu tion is ca p ita lize d at $25,000
w ith a su rp lu s o f $12,500.
H e a d s M a h a sk a B a n k ers
First N a tio n a l B an k
Davenport, Iowa
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
E . W . G od d a rd o f the N ew Sh aron
State B a n k , N ew Sh a ron , Io w a , w as
elected presid en t, and Leslie J o n e s o f the
F a rm ers N a tion a l B a n k o f O skaloosa,
Io w a , secretary o f the M ah ask a C ou n ty
B a n k ers A s socia tion , at a m eetin g held
recen tly.
V e r y op tim is tic re p o rts com e fr o m all
banks in the cou n ty and all expi*essed the
99
b e lie f that 1928 w ill be the best y ea r Iow a
has had f o r several years.
Jasper Bankers M eet
F if t y m em bers o f the J a s p e r C ou n ty
B a n k ers A s so cia tio n m et in N ew ton , Iow a ,
rece n tly at the N ew ton C ou n try C lub f o r
a business meeting' and to hear R . H .
J a ck son , p re sid en t o f the B a n k ers R e
search B u reau o f D es M oines, and others
w ho ga ve in terestin g and in stru ctive a d
dresses on the v a riou s phases o f ba n kin g.
T h e sp ea k er also con d u cted an op en
fo ru m w h ich w as o f m uch interest and
eviden t benefit to those p resen t. S en a tor
A . II. B ergm an gave a talk.
H e sp oke
on the b a n k in g ou tlook o f the cou n ty and
state as w ell as the ta x p r o p o s itio n w hich
w as u p b e fo r e the com m ittee recen tly.
U lrie C leven in ger o f M on roe, to ld o f
the state shoot recen tly held in D es M oin es
and also described the n ation a l m eet at
C a m p P e r r y , O hio, w h ich he a tten d ed .
M r. C leven in ger is a sh a rp sh ooter an d a
m em ber o f the J a s p e r vigilan tes.
S h o rt talks w ere also m ade b y a n um
b e r o f oth ers in clu d in g D r. B o y d o f C ol
fa x , C harles B u rd ick o f B a xter, L. A .
R u ssell o f N ew ton , B loom R y a n o f C o lfa x
and P . H . B e s to r o f N ew ton .
A three cou rse chicken
se rv e d to th e b a n k ers.
d in n er
HELPFUL
and rapid banking service to
Northern and Northeastern
Iowa banks by a responsible
and welh equipped financial
institution.
was
Mr. B anker ~
Keep Your
Christmas Cards
ou t o f the
Waste Basket /
OFFICERS
E. W. MILLER, President
JAMES M. GRAHAM, Vice President
H. W. WENTE, Cashier
S. C. KIMM, Assistant Cashier
R. L. PENNE, Assistant Cashier
CHAS. S. McKINSTRY, Assistant Cashier
Chances are that 9 9 % of all
Christm as Greeting Cards sent
to business firms, go into the
waste basket the m orning after
Christm as.
W hen you send a
friendly greeting, you’d like to
think it w ill last longer than
the tim e it takes to remove it
from its envelope.
Th e envelope it is received in,
the card it is mounted on, both
hit the waste basket, but the
Crystal Gold finished calendar,
goes on the customer’s desk and
remains
there
for
the
full
twelve months.
Can be mailed
complete, mounted
on
a Christm as
card, in a season
ably decorated en
velope
for
ll/2c
postage.
W rite for prices
and free sample.
M e C o m m e r c ia l
N ational Ban k
C A P I T A L a S U R P L U S -O N E H A L F
M ILLION DOLLARS
WATERLOO,IOWA.
C. E . E R IC K S O N C O ., Inc.
Des M oines, Io w a
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
100
A d o p t S e rv ice C h arge
SERVICE
From the very first day that this Bank first
opened for business in 1 91 3, our entire resources,
all our facilities and every effort o f each one of
us have been centered upon one thing—
SERVICE
Our large and ever growing patronage is the
result o f friendly service, conscientiously ren
dered.
SECURITY STATE BANK
R FO ETTR
TC IW A
lvJVV-rv
Inviting Your Account Upon
Our Record of Personal Service
E. E. C o o m b s , President
M. E. T
a te,
V ice Pres.
A service cha rge o f 50 cents p e r m onth
on all ch eck in g accou n ts u n der $50 was
a d op ted b y the P o lk C ou n ty B a nk ers A s
socia tion at a recent m eetin g at the E ast
D es M oin es Club. The m easure m ust be
ratified b y the in d iv id u a l m em bers o f the
a ssocia tion b e fo r e it w ill be pu t in to effect.
B . F . R o th r o ck o f the State B a n k o f
B on d u ra n t w as elected p re sid e n t o f the
associa tion f o r the com in g year.
O ther
officers nam ed are vice p resid ent, E lm er
M yh re, F a rm ers S a vin g s Bank, A n k e n y ;
secretary, N. E . K e lle y , A lto o n a S a vin gs
B a n k ; treasurer, B lain e G ildea, G rim es
S a v in g s B ank.
A n o th e r m easure con sid ered by the as
socia tion w as the a d o p tio n o f a service
charge f o r h a n d lin g legal p a p e rs. A co m
m ittee was a p p o in te d to con sid e r the p r o
posal.
T a k en to H o s p ita l
A f t e r con su ltation w ith his ph ysician ,
S im on C a sa d y, D es M oin es ba n k er, w ho
has been ill f o r sev era l m on th s, h as been
rem ov ed fr o m his h om e to M e r c y h o s
p ita l.
On b e h a lf o f the con su lta n ts, p h y s i
cia n s said th at M r. C a sa d y ’ s re m o v a l
w as n ot the result o f an y serious change in
his con d ition , but w as effected to m ake
availab le f o r him the m ore elaborate care
and p reca u tion s o f the h ospital.
A t the C a sa dy hom e M rs. C asady said
that the in v a lid ’ s co n d itio n w as unaltered
but that she fe lt his chances f o r re co v e ry
w ou ld be better at the h ospital than at
home.
C o n d itio n S ou n d
OFFICERS
OFFICERS
C. A. M A R S H
President
A. M. P L A C E
Vice President
H. A. M A IN E
Vice President
W I L L A. L A N E
Cashier
P. W. E IG H M E Y
Assistant Cashier
L. R. SW EN SO N
Assistant Cashier
Judging the Future by the Past!
The F irst N ational B an k of
W a te r lo o has a lready celebrated
its 60th A n n i v e r s a r y ! I t s p r e s e n t
officers And a r e v i e w o f the p ast
an i n s p i r a t i o n f o r the c o m i n g
y ea r s.
T h e “ F i r s t ” f r o m the s t a r t ha s
b u i l t s o l i d l y — It has n o t f o r c e d its
growth.
T o d a y it is s o u n d a n d
grow ing.
T h orou g h ly seasoned by experi
e n c e — this b a n k w i l l c o n t i n u e to
g r o w b e c a u s e o f the m o m e n t u m
it h a s g a t h e r e d f r o m th e c o n f i
d e n c e o f its f r i e n d s a n d c u s t o m
ers.
In t h e ir f u t u r e th e “ F i r s t ”
is a l w a y s i n t e n s e ly i n t e r e s t e d ------a n d it w i l l c o n t i n u e to s e e k its
g r o w t h u p o n its r e c o r d o f “ S e r v
ice R e n d e r e d ” an d “ S e r v i c e to be
R end ered.”
First National Bank
"Waterloo, Iowa
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
Iow a banks u n d er state su p ervision are
in a g en era lly sound con d itio n , while de
p osits in creased $1,387,966.88 betw een
Ju n e 30th an d O ctob er 10th, in d ica tes the
con solid a ted statem ent o f the con d ition
o f the banks at close o f business on the
la tter date, issued recen tly b y L. A . A n
drew , state su perin ten den t o f bank ing.
D u rin g the same p eriod , loans w ere in
creased $4,689,568.92, and b o rro w in g s de
creased $544,394.83.
T h e in crease in loans, the first show n
w ith in a yea r b y a state bank call, is an
in d ica tion o f fa v o ra b le b a n k in g c o n d i
tions, M r. A n d rew said.
A reserve o f 15.2 p e r cent, an average
figure, was m aintained, w hile the secon
d a ry reserves w ere increased $165,201.08
th rou gh the p u rch a se o f U n ited States se
curities.
E le ct N ew O fficers
T h e H a r d in C ou n ty , Io w a , B a n k e rs
A s s o c ia t io n h eld th eir an n ua l e le c tio n o f
officers at Io w a F a lls N o v e m b e r 15th.
A . P . M a son , p r e s id e n t U n io n S a vin g s
B a n k , U n ion , Io w a , p r e s id e n t ; E . H .
M o o n , ca sh ier P r o v id e n c e S ta te B a n k ,
N ew P r o v id e n c e , Io w a , v ice p r e s id e n t ; E .
101
S. P itm a n , v ic e p re sid e n t S ta te B a n k o f
B u ck e y e , se c r e ta r y an d trea su rer.
Insurance on Security
W e s le y J o h n so n o f D a y to n , Io w a , se c
r e ta r y o f the S ca n d in a v ia n M u tu a l I n
su ra n ce A s s o c ia t io n o f W e b s te r an d a d
jo in in g co u n tie s , ca lls the a tte n tio n o f
b a n k e rs to th e f o llo w in g p o in t r e la tiv e to
m a k in g loa n s on ch a tte l m o r t g a g e s :
“ A t th is tim e o f th e y e a r the b a n k s o f
the n o rth w e st, e s p e cia lly the c o u n tr y
banks, are m a k in g loa n s on ch a tte l m o r t
g a g e s. A s a r u le th e y p a y b u t little , i f
a n y, a tte n tio n to th e in su ra n ce on the
p r o p e r t y th a t is m o r tg a g e d as s e cu rity
f o r th e loa n . T h e p r o p e r t y is u su a lly in
su red, b u t n e a rly e v e ry p o lic y o f in
su ra n ce h as a cla u se sim ila r to cla u se g,
p a ra g ra p h I V , s e c tio n 9018, o f th e C od e
o f Io w a , w h ich w ill v o id the p o lic y i f the
p r o p e r t y in su re d b e co m e s e n cu m b ered
u n less a r id e r is a tta ch e d to th e p o lic y
p r o v id in g f o r su ch en cu m b ra n ce.
“ I t is w e ll k n ow n b y th e b a n k ers th at
w h en lo a n s are m a d e on rea l esta te an
a ssign m en t o r m o r tg a g e cla u se is a t
ta ch e d to th e in su ra n ce p o lic y m a k in g
loss on b u ild in g s , i f a n y, p a y a b le to the
m o rtg a g e e . I t is o f s till g re a te r im p o r
ta n ce th a t a m o rtg a g e cla u se be a tta ch ed
to th e p o lic y w h ere loa n s are m a de on
ch a tte ls th an on re a l esta te b eca u se on
re a l e sta te th ere w ill be th e la n d le ft ,
b u t o n ch a tte ls all o f the p r o p e r t y m o r t
g a g e d as se c u rity f o r th e loa n m a y be
d e s tro y e d .
“ S e cre ta rie s o f in su ra n ce a s so cia tio n s
m u st k e e p th e ir r e co r d s u p an d are a n x
iou s to g iv e r e a l s e rv ice an d i f th e y are
n o tifie d b y the b a n k m a k in g th e loa n on
ch a tte ls th e y w ill see to it th a t the b a n k ’ s
in te re st in th e in su ra n ce is p r o te c te d , bu t
u n less th e b a n k e rs see to it th a t th e se c
r e ta r y o f th e a s so cia tio n , or on e o f its
agen ts, has du e n o tic e th ere is n o lia b ility
on th e p a rt o f th e in su ra n ce a s so cia tio n .
“ I w ish y o u w o u ld c a ll th e a tte n tio n
o f the b a n k e rs to th is m a tte r as it w ill
n o t o n ly p r o t e c t them , b u t w ill a v o id m is
u n d e rsta n d in g an d c o m p lica tio n s i f a loss
sh o u ld be su sta in ed on in su red p r o p e r t y
th a t th e y h o ld a m o rtg a g e o n .”
They Were There
T h e fo llo w in g is a list o f th ose p erso n s
a tte n d in g th e re ce n t A . B . A . c o n v e n tio n
fr o m I o w a :
*Andrew, L. A., president, Citizens Savings
Bank, also superintendent of banking,
and wife, Ottumwa; Bice.
xBagley, W. G. C., vice president, First
National Bank, and wife, Mason City;
Bice.
*Bonesteel, V. C., vice president, Security
National Bank, and wife, Sioux City;
Sam Houston
X
Metcalf, Cowgill & Co.
Investment Securities
\
SIOUX CITY
DAVIDSON BLDG
DES MOINES
EQUITABLE BLDG.
57488
Auto.
M a rk e t 2 7 5
T
H E officers and directors
of
the
Central
Bank invite the business of
banks
and
financial houses
who enjoy dealing with an
organization that is not only
sound in its traditions, but
also alert to the requirements
o f modern banking.
SIM ON C A S A D Y
Chairman of the Board
G R A N T M cPH ERR IN
President
T H E O L D R ELIAB LE
Central State Bank
OF DES MOINES
Banking, Trusts and Investments
Safe Deposit Vaults
Member
Federal
Reserve
System
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
State
D ecem b er 1927
102
) u - w > n -h
m i
+ d <w
v
v h
m s
»1 1 H -1 iTVFnn^C'ÏT'W-'tltW )( VKKSKyçyKX?<TJrFFC7('>3K ) ( Y H ) ( Ï H )CHK)TVfCKVK )( VK ) G
l it h o g r a p h in g
» \* t » m
» vu n W I H 4 U I W I I U I « M
H'm
H ' f f n r f f n n y u 'w
m
m
u w
) i ,t f o n :R > f ) 4 { i (
w
m
w
)T 7w n > tit)> ü t
^ ^ 5 M 0\^5>^
cfounded by
GEORGE
EDWIN
H. R A G S D A L E
G. R A G S D A L E
SEC RE TAR v
xBurianek, John Jr., president, The Peoples
Savings Bank, Cedar Bapids; Bice.
*Corey, A. B., director, Iowa Turst &
Savings Bank, Des Moines.
DePuy, Clifford, publisher Northwestern
Banker, and wife, Des Moines; Sam
Houston.
*Dinwiddie, J. M., president, Cedar Bapids
Savings Bank & Trust Co., and wife,
Cedar Bapids; Bice.
xGreen, Irvin J., cashier, First National
Bank, and wife, Davenport; Bender.
*Heuer, Wm., president, Union Savings
Bank & Trust Co., Davenport; Bice.
xJansen, John H., assistant cashier, Fed
eral Bank & Trust Co., Dubuque; Cotton.
*Johnson, Elbert L., president, Leavitt &
Johnson Trust Co., Waterloo; Bice.
*Lipton, Bobt., private bank, Anderson,
Lipton & Co., and wife, Ida Grove; Audi
torium.
*Litteer, E. J., vice president, First Na
tional Bank, Gladbrook; Cotton.
*McKee, B. L., cashier, Muscatine State
Bank, and wife, Muscatine; Sam Hous
ton.
*McPherrin, Grant, president, Central
State Bank, and wife, Des Moines; Bice.
*Mesmer, Carl W., assistant cashier, Peo
ples Savings Bank, and wife and son,
Des Moines; Bender.
*Miller, E. W., president, Commercial Na
tional Bank, and wife, Waterloo; Bice.
xMiller, Geo. F., vice president, Cedar Bapids National Bank, and wife, Cedar Bap
ids; Auditorium, room 504.
Mullen, J. P., director, Fairburn State
Bank, Fonda; Victoria.
*Nyemaster, Bay, vice president, American
Commercial & Savings Bank, Davenport;
Bice.
*Pollard, H. L., vice president, Ottumwa
Savings Bank, and wife, Ottumwa; Ben
der.
*Schaller, Geo. J., president, Iowa Bankers
Association, and wife, Storm Lake; Bice.
xSharp, Frank, assistant Clearing House
Manager of Des Moines, Des Moines;
Sam Houston.
Sharpe, J. H., clearing house examiner, Des
Moines Clearing House, Des Moines; Sam
Houston.
xSheldon, F. E., president, Mount Ayr State
Bank, Mount Ayr.
xSmith, A. C., president, City National
Bank, and wife, Clinton; Sam Houston.
xTate, M. E., vice president and cashier,
Security State Bank, and wife, Keokuk;
Auditorium.
Tschirgi, E. M., assistant cashier, Federal
Bank & Trust Co., Dubuque; Cotton.
*Warner, Frank, secretary, Iowa Bankers
Association, Des Moines; Bice.
*Webbies, E., president, First Iowa Trust
& Savings Bank, and wife, Burlington;
Sam Houston.
xWegman, Leo J., cashier, American Sav
ings Bank, and wife, Carroll; Sam Hous
ton.
xWohlenberg, Carl C., president, Merchants
State Bank, and wife, Correctionville;
Auditorium.
xWohlenberg, C. J., president, Holstein
Savings Bank, and wife, Holstein; Audi
torium.
xDelegate.
A m od est co n fe s s io n o f ig n o ra n ce is
the rip est and last attainm ent o f p h ilo s
o p h y .— H itch cock .
N ecessity n ever m ade a g o o d b a rgain .
— F ra n k lin .
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
103
“NO MORE GUESSING ON CREDIT”
(C o n tin u e d fr o m p a g e 21 )
^ | ^ HE
Will Be Examiner
T he A s s o c ia t io n b elie v e s th a t it has
secu red in the p e rso n o f L y m a n C. S o r e n
sen, w h o w ill be the e x a m in er f o r th is
d is tr ic t, a m an em in e n tly fitted f o r the
w o rk w h ich he w ill be ca lle d u p on to do.
M r. S ore n se n h as h a d sp e cia l tra in in g in
th is lin e o f w o rk . F o r tw o y e a r s he w as
a p r o fe s s o r in th e D e p a rtm e n t o f B u s i
ness o f th e U n iv e rs ity o f N eb ra sk a . H e
h as also h a d c o n s id e r a b le e x p e rie n c e as
a F e d e r a l b a n k e x a m in er in the T en th
R e s e rv e D is trict, e s p e cia lly a m on g the
la rg e r ba n k s, and h as m ore r e ce n tly been
w ith th e B a n k in g D e p a rtm e n t o f N e
b ra sk a . T h is e x p e rie n ce h as p u t h im in
clo se to u ch w ith the m eth od s o f o p e r a tio n
o f C le a rin g H o u ses, an d wi l l m a ke his
s e rv ice s to th e n ew A s s o c ia t io n d o u b ly
v a lu a b le .
H is h ea d q u a rte rs w ill be in
F re m o n t.
I n h is n ew d u ties, M r. S oren sen w ill
w ork d ir e c tly u n d er the D e p a rtm e n t o f
T ra d e an d C o m m erce o f th e S ta te o f N e
b ra sk a , an d wdll b e d ir e c tly r e sp o n sib le
to th e b a n k in g co m m issio n e r on ly . H o w
ever, in th is t e r r it o r y w h ich he w ill n ow
h ave as h is p e r s o n a l ch a rg e, he w ill be
p r a c tic a lly th e c o u r t o f la st a p p ea ls, and
w ill be s o rt o f a S u p e rin te n d e n t o f B a n k
in g h im s e lf.
A s th e o n ly ex a m in er in h is d is trict,
and h a v in g it u n d e r h is in d iv id u a l care,
M r. S ore n se n w ill be a b le to m a k e m a n y
h e lp fu l su g g e s tio n s an d r e co m m e n d a
tio n s to th e m em b er ba n k s. H e w ill be
e x p e cte d to do all he ca n to c o o p e ra te
w ith th em in e v e ry w a y w ith in the law .
H e w ill n o t h a v e c re d it in fo r m a t io n on
e v e ry in d iv id u a l b o r r o w e r , b u t w ill e x
p e c t h is b a n k o r b a n k s to su p p ly h im w ith
su ch in fo r m a t io n w h en n ecessa ry .
I n s p e a k in g o f th e im p o rta n ce o f the
e x a m in e r’ s du ties, M r. S tep h en s s a y s :
“ T h e e x a m in e r’ s en tire a ttitu d e w ou ld
be n e w an d d is tin c t fr o m th a t o f the a t
titu d e o f th e a v e ra g e ex a m in er u n d er the
o ld regim e.
H e w o u ld cea se to be an
o r d in a r y ce n s o r, g o in g in to the b a n k
a c tin g w ith o u t rea l r e s p o n s ib ility in a
m a n n er th a t a n ta g o n ize s th e officer w ith
o u t p r o d u c in g resu lts, b u t, on th e c o n
tra ry , w o u ld b e com e a sy m p a th iz in g a d
v is o r and d ir e c to r in the m a n a gem en t o f
th e b a n k , r e c e iv in g th e c o -o p e r a tio n o f
the b a n k e r in c a r r y in g o u t the sou n d
p r a c tic e s th a t th e e x a m in er b e lie v e s
w o u ld p r o d u c e resu lts.
H is a ttitu d e is
v a s t ly d iffe re n t f r o m th a t o f an ex a m in er
u n d e r th e o ld o rd e r, w h o is h ere to d a y
and som ew h ere else to m o rro w , an d h as no
r e s p o n s ib ility f o r the resu lts o f h is a c
tion s. H is re p u ta tio n as a h igh cla ss e x
am in er is at stak e. A b a n k fa ilu r e is a
d is g ra ce .
D es
M o in e s
business o f
Iow a banks is i n v i t e d .
T hese
banks are thorou gh ly equipped in
every departm ent.
Valley National Bank
AND
Valley Savings Bank
DES MOINES, IOWA
V alley Bank Building
R. A . C R A W F O R D , President
D. S. C H A M B E R L A IN , V ice President
C. T. COLE, JR ., V ice President
W . E. B A R R E T T , Cashier
JOH N H. GIN SBERG, A sst. Cashier
C. M. C O R N W E L L , Asst. Cashier
Established 1872
Combined Capital and
Surplus
$1 ,100 ,000,00
18 76
I 9 2 7
(T^H E Consolidated National Bank has behind
it not only many years of val
uable experience, but also the
daily contacts which come
with the handling of hundreds
of correspondent items. That
is why we believe we can be
of real service to your institu
tion.
u n b ro k e n reco rd o f f i f t y
years is a g u a ra n te e o f safe
an d s a tis fa c to ry service ”
“ An
Consolidated National Bank
U N IT E D S T A T E S D E P O S IT O R Y
DUBUQUE, IOWA
J. K. Dem ing, President
Geo. W . Myers, V ice President
Jas. M, Burch, V ice President
Herm an Eschen, Secretary
Jos. W . Meyer, Cashier
“ C e rta in ly , u n d er th is p la n , b a n k s w ill
b e co m e stro n g e r, p u b lic con fid en ce w ill
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
104
im p ro v e and the losses w ill be tre m e n d
o u sly re d u c e d .”
N ature is the m aster o f ta le n t; geniu s
is the m aster o f natu re.— H olla n d .
Some Good Sportsmanship
(O h io State J o u rn a l)
G ood sp ortsm a n sh ip w as show n b y o f
ficials at Y a le and P rin ceton in h a n d lin g
the case o f B ru ce C aldw ell, star p la y e r
etc
The Midland Bank offers exceptional facilities for the transaction
of banking business of every description. Together with its
affiliations it operates nearly 2400 branches in Great Bri ain
and Northern Ireland, and has agents and correspondents in
all parts of the world. The Bank has Offices in the Atlantic
Liners Aquitania, Ber engaria and Mauretania, and a foreign
branch office at 196 Piccadilly, London, specially equipped for
the use and convenience of visitors in London.
M IDLAND BANK
L IM IT E D
H E A D O F F I C E ; 5 T H R E A D N E E D L E S T R E E T , L O N D O N , E.C. 2
Affiliated Banks : Belfast Banking C o. L td., Northern Irela n d ; T h e
Clydesdale Bank L td., and North o f Scotland Bank L td., Scotland.
o f the Y a le fo o tb a ll team. The fine sp irit
and cou ra g e show n there should be studied
b y p a tron s o f sp o rt in all lines.
The
cou n try has been given an in teresting il
lu stra tion o f the righ t w a y o f d o in g
things, the best m ethod o f m eetin g u nex
p ected and a n n oy in g experiences.
O n ly a fe w da ys b e fo r e the Y a le -P r in ce ton gam e a story w as m ade p u b lic that
C aldw ell w as in eligib le to p la y w ith Y ale,
because he had p la y e d som e fresh m an
gam es w hile a student in an oth er school,
a fa c t not in the possession o f the athletic
o f f ic ia l b e fo re . Y a le needed that p la y e r
and P rin ceton men knew and u n derstood
the value he gave to th eir h istoric o p
pon en ts.
Y a le met the situ ation p r o m p tly and
w ith fine sp irit declared C aldw ell in e lig i
ble u n der the rule a ffectin g tra n sfe r o f
students.
The Y a le action b rou gh t one
equ ally fine- fr o m P rin ceto n , w here the
athletic officials and the p resid en t united
in a letter to Y a le o ffe rin g to w aive the
in e lig ib ility o f C aldw ell and p erm it him
to have his p a rt in the gam e.
I t w as fine, clean sp ortsm a n sh ip and
real s p irit on the p a rt o f P rin ce to n , even
i f the p la n suggested w as n o t a d op ted .
I t is the sort o f sp ortsm a n sh ip the co u n try
en jo y s. It adds to the a p p e a l o f the gam e
and b rin gs to it a real luster. T h ere w as
g lo r y f o r both Y a le and P rin ce to n , a fine
exam ple show n o f the best w a y o f d o in g
things, a g rea t ex h ib ition o f the clean
s p irit that should be in eviden ce in all
sp orts.
jjivijjjNX u t i m ¡ UW -NLKSH IP, M A N A G E
M E N T , C IR C U L A T IO N , ETC., R E Q U IR E D B Y
T H E A C T OF CON GRESS OF A U G U ST 24,
1912,
Of
the
N orthw estern
B anker,
published
m onthly at Des M oines, Iow a, fo r O ctober, 1,
1927.
State o f Iow a, 1
ss.
)
H o te ls of H ospitality
H otel Fontenelle----------------------------------Omaha, Neb.
H otel Chieftain-----------------------C ouncil Bluffs, Iowa
H otel L in co ln ------------------------------------- Lincoln, Neb.
H otel R om e------------------------------------------Omaha, Neb.
H otel M ontrose-------------------------Cedar Rapids, Iow a
“ Unchanging
Rates
H otel Martin--------------------------------Sioux City, Iowa
are Posted
in E very
H otel N o rfo lk -----------------------------------N orfolk , Neb.
E pp ley Room •”
H otel Capital------------------------------------L incoln, Neb.
H otel Carpenter---------------------------Sioux Falls, S. D.
H otel Cataract------------------------------Sioux Falls, S. D.
H otel W est----------------------------------- Sioux City, Iowa
H otel Magnus---------------------------- Cedar Rapids, Iowa
H otel Evans-------------------------------------Colum bus, Neb.
O p e r a te d b y E p p le y H o te ls C o m p a n y
N orthw estern B anker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
D ecem b er 1927
B efo re me, a N otary P u b lic in and fo r the
State and cou nty aforesaid , p ersonally appeared
C lifford D eP uy, who, having been d uly sw orn
a cco rd in g to law, deposes and says that he is
the p u blisher o f the N orthw estern B an ker and
that the fo llo w in g is, to the best o f his k n o w l
edge and b elief, a true statem ent o f the ow n er
ship, m anagem ent (and if a d a ily paper, the
circ u la tio n ), etc., o f the a foresaid pub lica tion
fo r the date show n in the above caption, r e
quired b y the A ct o f A ugu st 24, 1912, em bodied
in section 411, P osta l L aw s and R egulations,
p rinted on the reverse side o f this form , to w it :
1.
That the nam es and addresses o f the p u b
lisher, editor, m anaging editor, and business
m anagers are :
P u blish er— C lifford D eP u y, 555 7th Street,
Des M oines, Iow a.
E d itor— R alph W . M oorhead, 555 7th Street,
Des M oines, Iow a.
B usiness m anager— G erald A . Snider, 555 7th
Street, Des M oines, Iow a.
2.
That the ow ner is : ( I f ow ned b y a c o r
p oration , its name and address m ust be stated
and also im m ediately thereunder the names and
addresses o f stockh old ers ow n in g or hold ing one
per cent or m ore o f total am ount o f stock.
If
not ow ned b y a corporation , the names and
addresses o f the ind ivid u a l ow ners m ust be
given. I f ow ned b y a firm, com pany, or other
un in corp orated con cern, its name and address,
as w ell as those of each ind ivid ual member, must
be giv en .)
C lifford D eP u y, 555 7th Street, Des M oines,
Iow a.
3.
That the know n b ond hold ers, m ortgagees,
and other secu rity holders ow n in g or holding
1 per cent or m ore o f total am ount o f bonds,
m ortgages, or other securities a re : ( I f there
are none, so state.)
None.
C l i f f o r d D e P u y , Publisher.
Sw orn to and su b scrib ed b efore me this
8th day of October, 1927.
E a r l S. L i n n .
(M y commission expires July 4, 1 9 3 0 .)
105
T o the S w ift
M ista k en I d e n tit y
T o o k P a r t o f T re a tm e n t
A n o ld b la ck m an w ho h ad sp en t m a ny
y e a rs in a w h eel ch a ir w a n ted to g o on
on e la st co o n h un t b e fo r e he d ied . S o he
an d h is g ra n d ch ild re n , a cco m p a n ie d b y
sev era l d og s, sta rte d out.
H a r d ly
had
th e y
p e n e tra te d
the
sw a m p s w h en th ey m et a b ea r.
A ll
tu rn ed tail and ran, le a v in g g ra n d p a p to
his fa t e .
A s th e y cam e p a n tin g in to th e y a rd
th e y
ca lle d ,
“ Oh,
m am m y,
m am m y,
g ra n d p a p d on e g o t et up b y a b ’ a r ”
“ F oolish m en t w hat y o ’ speaks, children.
Y o ’ g ra n d p a p d on e com e in ten m in u tes
ago w id de d o g s !”
The s t o r y g o e s th at a s tra n g er in a
ce rta in n e ig h b o r h o o d h a d b een b ro u g h t to
a d a n ce at the lo c a l d e a f an d du m b h o s
p ita l.
“ H o w on ea rth ca n I ask a d e a f and
d u m b g irl to d a n c e ? ” he asked, a trifle
a n x io u s ly .
“ J u st sm ile an d b o w to h e r,” re p lie d
the d o c to r .
S o the y o u n g m an p ic k e d ou t a p r e tty
g ir l and b ow ed and sm iled , and she
b ow ed an d sm iled , an d a w a y th e y d a n ced .
T h ey d a n ced n ot o n ly on e d a n ce th at
ev en in g , bu t th ree, and he w as on the
p o in t o f a sk in g h er f o r a n oth er w hen a
stra n ge m an a p p ro a ch e d his p a rtn e r and
said, s o u lf u lly :
“ I say, d a rlin g , w hen are w e g o in g to
have a n oth er d a n ce ? I t ’ s a lm ost an h ou r
sin ce I h ad on e w ith y o u .”
“ I k n ow , d e a r,” a n sw ered the g irl, “ bu t
1 d o n ’ t k n ow h ow to g e t a w a y fr o m th is
d e a f and du m b f e l l o w ! ”
A S cotch m a n , n o t fe e lin g so w ell as
u su al, c a lle d on his fa m ily d o c to r , w h o
lo o k e d h im o v e r and g a v e h im som e p ills
to be ta k en at b ed tim e.
W h is k e y w as
also p r e s c rib e d f o r his sto m a ch ’ s sake, a
sm all g la ss to be ta ken a ft e r each m eal.
F o u r d a ys la te r S a n d y again ca lle d on
the d o c to r , sta tin g he w as fe e lin g n o b e t
ter.
“ H a v e y o u ta k en the m e d icin e e x a c tly
as I in s t r u c t e d ? ” th e d o c to r in q u ired .
“ W e ll, d o c to r ,” re p lie d the p a tie n t, “ I
m ay be a w ee b it b eh in t w i’ th a p ills, bu t
I ’ m six w eek s ah ead w i’ th a w h u sk y .”
A n E y e f o r an E y e
A c o lo r e d la d m et th e w h ite o w n e r o f a
v icio u s b u lld o g on th e street.
“ B o s s ,” he sa id co m p la in in g ly , “ da t
b ig d a w g o ’ y o u rn ch a sed m e dis m o ’n in ’
a n ’ tu k a w a y de m o s ’ u s e fu le s t p a rt o ’
m ah p a n ts — ”
“ H o , h o, h o ! ’ ro a r e d the d o g ’ s ow n er.
“ W e ll, d o n ’ t let th at b o th e r y o u , Sam .
Y o u can g e t a n ew p a ir o f trou sers, y ou
k n o w .”
“ Y a ssu h , A h ’ s p e c ’ s A h k in ,” retu rn ed
Sam , h as fa c e cle a rin g , “ J e s ’ de sam e as
y o ’ k in g it a n ew d a w g .”
Case D ism issed
T h e m a g istra te b e n t stern b ro w s on the
d e fe n d a n t.
“ Y o u are ch a rg e d w ith e x ce e d in g the
sp eed lim it last n ig h t,” he d ecla im ed .
“ A r e y o u g u ilty o r n o t g u ilt y ? ”
“ W e ll, y o u ca n d e cid e f o r y o u r s e lf,
J u d g e ,” re p ied the p rison er.
“ I w as
in th a t ca r you p a ssed ju s t b e fo r e th ey
p in ch e d m e.”
Can Y o u “ B e e t” I t ?
T h is th r illin g lov e le tte r w as fo u n d in
a b a sk et o f b e a n s : “ D ea rest S w eet P e a :
D o you c a r r o t all f o r m e. M y h ea rt beets
f o r y o u , w ith y o u r ra d ish h a ir an d y o u r
tu rn ip n o s e ; y o u are the a p p le o f m y
eye. G ive m e a da te. I f w e ca n ta lo u p e
lettu ce m a rry , a n y w a y . I k n ow we w ou ld
be a h a p p y p ea r.
L I M A B E A N .”
E co n o m y
“ D id you h ear th at th e fire d ep a rtm en t
fired th e ir efficien cy e x p e r t ? ”
“ T h e y d id ?”
“ Y e p , he w en t and p u t u n b rea k a b le
glass in all the fire alarm b o x e s .”
S w e e tly M a ted
D a d d y N o t in S ty le
A s a r e w a rd f o r b e in g an
g o o d b o y , little fo u r -y e a r -o ld
w as a llo w e d a p e e p at M o th e r
w as d ressed f o r a p a rty . H e
e y e d h er so le m n ly, then s a i d :
g o in g to u n d ress, t o o ? ”
e s p e cia lly
R e y n o ld s
a ft e r she
s to o d and
“ Is d a d d y
So I t W a s
T raffic C o p — “ W h a t ’ s y o u r nam e ?”
T ru ck D r iv e r — “ I t ’ s on th ’ side o f me
w a g o n .”
C o p ( t r y in g to read n a m e )— “ I t ’ s o b
lite ra te d .”
D riv e r — “ Y e r a lia r !
I t ’ s O ’B r ie n .”
L icen se w as issu ed f o r the m a rria g e o f
E b en ez er S w eet and J a n e L em on .
The in q u irin g r e p o rte r w ho g ot h old o f
the c o p y h ad a rh y m in g as w ell as in q u ir
in g in stin ct and he w ro te it u p :
“ B eh old h ow g re a t e x trem es do m eet
In J a n e and E b e n e z e r;
F o r J a n e ’ s n o lo n g e r so u r b u t sw eet
A n d E b ’s a lem on sq u eez er.”
H e r M a ste rp ie ce
H a r r y : “ G la d y s is the p ic tu r e o f
h ea lth .”
V i r g i n i a : “ A n d she p a in te d it h e rs e lf,
to o .”
K n e w W it h o u t T h in k in g
T ea ch e r— “ N ow , W illie , i f J a m es g a v e
y o u a d o g and D a v id g a v e y o u a d og, h ow
m a n y d og s w ou ld y o u h a v e ? ”
W illie — “ F o u r .”
T ea ch er— “ N ow ,
dear,
th in k
h ard .
W o u ld y ou h ave fo u r i f Ja m es and D a v id
each g a v e y o u on e ?”
W illie —-“ Y e p . Y o u see, I g o t tw o d o g 5
at h om e n o w .”
S y m p a th y
A h u n g ry d o g o n ce w a n d e re d
In to a b u tc h e r ’ s s t o r e ;
T he b u tch er th rew som e sausage
T o the d o g u p on the floor.
T he bu tch er said, “ N o w eat it,”
T he d o g said, “ I d eclin e,
F o r in th a t lin k o f sausage
Is th a t O ld Gal o f M in e !”
U n a v o id a b le
M a r y — “ I h ear th a t the sh y M r. R u b y
w as in an a u tom ob ile a c c id e n t.”
J a n e— “ Y es, B e t ty C u d d le c ro w d e d him
o ff a c o u n tr y r o a d .”
M a r y — “ I d id n ’ t k n o w she d r o v e a
c a r .”
J a n e— “ She d o e s n ’ t.
rid e w ith h im .” — Life.
J u st L ik e ’E m
A f t e r s la v in g a w a y f o r y e a rs the in
v e n to r had p r o d u c e d a m a ch in e th a t w as
a su ccess.
H e o p en ed a ba n k a cco u n t,
and w en t h om e to tell his w ife o f his su c
cess.
“ A t last, m y d e a r,” he crie d , “ y o u ’ ll be
ab le to b u y som e d ecen t c lo t h e s !”
“ I ’ ll d o n o th in g o f th e s o r t,” cam e the
sh a rp r e p ly . “ I ’ ll g e t the sam e k in d th at
oth e r w om en are w e a r in g !”
N orthw estern Banker
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
She w en t f o r a
D ecem ber 1927
106
t f n
ò n
x
W
o
S
G
General M otors A c ce p ta n c e C o r p . . . .
A m e r i c a n C o m ’l & Saving's B a n k . .
A m e s - E m e r i c h C o ..................................
32
O m a h a N a t ’l B a n k .....................................
Ottman, E. H. & C o ....................................
26
66
P e o p l e s T r u s t & S a v i n g s B a n k ...........
P e a r s o n H o t e l ...........................................
P h i l a d e l p h i a - G i r a r d N a t ’ l B a n k .........
P o lk , H. H. & C o ........................................
P r ie s t e r , Q u a il & Cun dy , I n c ...............
P r o v i d e n t S ta te S e c u r it ie s C o ...............
96
86
83
63
41
51
II
B
H a l s e y - S t u a r t ..............................................
B a k e r , K e l l o g g & Co., I n e ...................... 59 H a n n a , W . D. C o ..........................................
B a n k e r s T r u s t Co., D e s M o i n e s ......... 93 H a n o v e r N a t ’ l B a n k ..................................
B a r t l e t t & G o r d o n ..................................... 54 H o a g l a n d , A l l u m & C o .............................
Beh , C a r le to n , D ........................................ 66 H o m e s t e a d C o ...............................................
B e ll T e l e p h o n e S e c u r itie s C o ............... 28 H o t e l C ha se .................................................
B r o k a w & C o ................................................ 62
B r o w n - C r u m m e r C o ................................... 69
48
39
88
67
76
86
I
Q
Illinois-M erchan ts Bank
....................108
I n d u s t r ia l A c c e p t a n c e C o r p .................... 58
Q u a l i t y P a r k E n v e l o p e Co.
96
I
n
t
e
r
n
a
t
i
o
n
a
l
H
a
r
v
e
s
t
e
r
C
o
..................107
Cam p, T h o r n e & C o ................................... 44
w a G u a r a n t e e M o r t g a g e C o r p ........ 64
C an ad ia n P a c ific R a i l w a y .................... 88 II oo w
a
L
i
t
h
o
g
r
a
p
h
i
n
g
C
o
............................
102
C. R. N a t ’l B a n k .......................................... 95 I o w a N a t ’ l B a n k ........................................
4
C en t r a l S ta te B a n k , D e s M o i n e s .........101 I o w a N a t ’ l F i r e Ins. C o ............................ 74
C e n t r a l T r u s t Co. o f 111......................... 80
C h a p m an , P. W . & C o ............................... 55
R eed , P. M. & B a n k e r A s s o c i a t e s . . . .
C ha se N a t ’l B a n k ..................................... 87
............................................. 51, 63, 83, 96, 101
C h i c a g o T r u s t C o ........................................ 34
R o y a l U n io n L i f e ................................. 43, 73
C ity N a t ’ l B a n k ........................................... 94
C o m ’l N a t ’ l B a n k ........................................ 99 Jo h n H a n c o c k M u t u a l L i f e Ins. C o.. . 72
C o n s o l i d a t e d N a t ’ l B a n k ........................103
C o n t ’l & C o m ’ l N a t ’l B a n k .................. 37
C u m m in s, M o r r i s o n . . . ......................... 65
S e c u r it y Sta te B a n k ..................................100
K r e n n & D a t o ............................................... 47 S t a n l e y - H e n d e r s o n C o .............................. 65
S ta te B a n k o f C h i c a g o ............................. 40
D
S ta te C e n t r a l S a v i n g s B a n k .................. 9 6
Stern, L a w r e n c e & C o .............................. 30
D e s M o in e s L i f e & A n n u i t y C o ........... 75
S ou th D a k o t a B a n k e r s ’ A s s ’ n ............. 32
D es M o in e s N a t ’ l B a n k .............................. 107
S t o c k Y a r d s N a t ’ l B a n k , C h i c a g o . . . . 82
D e t r o i t Co., T h e .......................................... 67 L i v e S t o c k N at l B a n k , O m a h a ........... 82 S t r a u ss & Co., R o b e r t ............................. 61
L
i
v
e
S
t
o
c
k
N
a
t
’l
B
a
n
k
,
S
io
u
x
C
i
t
y
.
..
79
De W o l f & Co., I n c ................................... 68
D o h e r t y , H e n r y L ....................................... 50
D r o v e r s N a t ’ l B a n k ................................... 90
T
U
M c C l i n t o c k C o............................................... 87
E
M c C o r m i c k - D e e r i n g .................................
6
M a s o n C ity B r i c k & T i l e ........................ 34
E p p le y H o t e l s ............................................104 M e r c h a n t s N a t ’ l B a n k .............................
5
E m e r y , P e c k & R o c k w o o d .................... 59 M e tc a lf , C o w g i l l & C o ...................59-69-101
E r i c k s o n , C. E. & C o ................................... 99 M id la n d B an k, N e w Y o r k C i t y ........... 104
M id la n d N a t ’l B a n k & T r u s t C o ........... 85
M ille r H o t e l C o ............................................ 76
M o r r i s o n H o t e l .......................................... 76
F
M ue hle, R e a m & M c C l a i n ......................... 76
F e d e r a l S u r e t y C o . . .................................. 70
F i d e l i t y B o n d & M o r t g a g e Co............. 60
N
F i r s t I o w a Sta te T r u s t & Sav. B a n k 92
F i r s t N at l B a n k , C h i c a g o ...................... 30 N a t ’ l B a n k o f C o m m e r c e ......................... 42
F i r s t N a t ’ l B a n k , D a v e n p o r t ................ 98 N a t ’ l B a n k o f the R e p u b l i c .................. 38
F i r s t N a t ’ l B a n k , O m a h a ...................... 33 N a t ’ l C ity C o .................................................. 53
F i r s t N a t ’ l B a n k , S io u x C i t y ............... 97 N a t ’ l L i f e A s s o c i a t i o n ............................. 75
F i r s t N a t ’ l B a n k , W a t e r l o o ...................100 N a t l P a r k B a n k ........................................ 84
F i s h e r C o ......................................................... 36 N o r t h e r n T r u s t C o ...................................... 78
F o r e m a n B a n k s .......................................... 31 N o r t h w e s t e r n N a t ’ l B an k, M in n e a p o lis 2
F o s h a y C o ....................................................... 97 N o r t h w e s t e r n N a t ’l L i f e Ins. C o . . . . 72
THE
P
NORTHW ESTERN
BANKER
D
C o.
u b l is h e d
by
eP uy
P
u b l is h in g
555 S even th S treet, D es M oin es
C L IF F O R D D E P U Y
Publisher
G. A. S N ID E R
A ssocia te Publisher
R. W . M O O R H E A D
E ditor
H. H. H A Y N E S
A ssocia te M anager
O fficial P u b lica tion of
T H E S O U T H D A K O T A B A N K E R S A S S O C IA T IO N
T H E IO W A FARM M O R T G A G E A S S O C IA T IO N
T H E IO W A B O N D D E A L E R S A S S O C IA T IO N
N orthw estern Banker
D ecem b er Í927
IT
U n it e d S ta te s Nat 1 B a n k ......................... 84
U. S. S h a res C o r p ........................................ 68
V a l l e y N a t ’ l B a n k ...................................... 103
W
W e l c h P r i n t i n g Co. . . . " . .......................
W h i t e - P h i l l i p s C o .......................................
76
25
DE PUY PUBLICATIONS AND THEIR TERRITORY
N orthw estern Banker
Des M oines
M id -C ontin ent Banker
St. L ou is
T ra n s-M ississip pi Banker
Kansas C ity
Southwestern Banker
F ort W orth
Iow a Bank D irectory
D es M oines
U nderw riters R eview
D es M oines
Insurance M agazine
Kansas C ity
L ife Insurance S elling
St. L ou is
New Y ork O ffice: Frank P. Sym s, 25 W e st 45th St.
C hicago O ffice: W m . H. M aas, 1221 F irst N ational Bank B ld g., Phone Central 3591
St. L ou is O ffice: D. H. Clark, 408 O liv e St., Phone Garfield 2138
Kansas C ity O ffice: G. D. M athew s, 405 R id ge B ld g ., Phone V ic to r 5254
Fort W orth O ffice:
L aw son H etherw ick, 409 F ort W orth N ational Bank
B u ildin g. Phone 2— 2513
M inn eapolis O ffice: Frank S. L ew is, 840 Lum ber E xch an ge, Phone M ain 3865
ìismmrnìmìmmiìmm\rrtx\ì7ri\ì7ri\rfri\^\^\ìTri\ì7ri\ì7ri\ì?ri\ì?ri\fà\ì7ri\mi\^
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
T h o m p s o n , R o s s & C o ............................... 52
T o d d C o ............................................................
7
T r u e - W e b b e r C o ........................................... 56
An Investment Service
for Your Bank
M any
of
our
correspondent and
other banks
throughout Iowa find the services o f the B ond D e
partm ent o f the Des M oin es N ation al B ank h elp fu l in
the investm ent o f their funds.
O ur com plete investm ent service is available to
your bank w ithout cost or ob ligation.
W e m ake
recom m endations on ly after careful consideration o f
your ind ivid u al investm ent needs.
O ur w ell d iver
sified offerings o f sound bonds always inclu de m an y
issues w hich are especially suitable fo r bank in vest
m ent.
W e w ill he glad to give you detailed in form ation
on the types o f bonds that w ill m eet your particular
needs.
O F F I C E R S
L O U IS C. K U R T Z , President
A N D R E W J. H U G L IN , V ic e Pres.
H E R B E R T L. H O R T O N , V ic e Pres.
G E O R G E D. T H O M P S O N , Cashier
C L A R E N C E A. D I E H L , A sst. V . P.
W A L T E R J. R O B E R T S . A sst. V . P.
R IC H A R D H. C O L L IN S . A sst. V . P.
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
E. F. B U C K L E Y , A sst. V . P.
O W E N P. M c D E R M O T T ,A ss t.C a s h .
L E L A N D J. A N D E R E C K ,A sst.C a sh .
C L Y D E H. D O O L I T T L E , Tr. Officer
V I C T O R H. P U L IS . A sst. Tr. Officer
D O N A L D J. M c M U R R A Y ,
M gr. B ond Dept.
The open door to banking service
Individuals, commercial concerns and
T h e specialized facilities of this insti
banks in all parts of the world, as well
tution for commercial banking, foreign
as our many thousands of custom ers
banking, investment banking, savings
here in Chicago, have come to recognize
and trusts make the Illinois Merchants
the great colonnaded entrance of the
Trust Company an advantageous Chicago
Illinois Merchants Trust Company as
connection for banks or business con
the open door to banking service.
cerns, wherever they may be located.
Illinois M erchants Trust C ompany
C apital & Surplus
/[ ^
¿Million D ollars
C H I C AG O
v„
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
■ ■
h h h i
@FedFRASER