, 1863-12-19
Report OF MIR. McCu11ocIl, Controller
Of the Currency.

There are one hundred and thirty-fonr National
Banks organized, Of which thirty eight In Ohio,
twenty In Indiana, twenty In Pennsylvania, ten In
New York, md the balance In other states.
The Controller says the act isnot altogether SYM
metrical, nor clear, nor even consistent through
out He advises Its revision, and to this end maxea
the following suggestions:
!. Thnt sections II, 1S Is, 81, Il, = DO modified
cies in their provisions. These arc, however, re-
garded Us minor defects that maJ merely enhar-
fass banks ii they donot lead to
the privileges granted to banks In other places.
Section u, literally construed, might prevent tho
National nsnks S dssonnt9s On ,hs SECURITY
ject Of the section undoubtedly was TO prevent
banks from diseountlng upon tho security Of their
on Sl an saaq y s9eK
2. That section Al be stricken ont us unWisely
restricting 1oans to single individuals.
:. 3. That section 80 bo 80 amended that the at.
fairs Of the banks may be managed by not more
thsn thirteen Instead Of nine, aud that only two
thirds ofthe drsctors bo required to be residents
OF tho State in which the banks are located.
&. Tlat section II be so amended that the fall
ure OF a National Bank be Declared pri:na facie
fraudulent, and that the officers and directors OF
such bank shall be made personally liable for the
debts, and be punished cTlminaly, unless 1t shall
appear that lis aaaits were honestly administered.
The section, as It Stands. makes al stockholders
iudlr1dudlIy Liable.
S. That section II be 80 amended, that when
there Ia NO paper in the Place, the quarterly re-
turns may be- Published In the paper nearest the
location q 1hs bank, instead Of q paper OF the
&. That section IS be. so smended that stock
holders owning less than onehalf per cent. OF tho
capital a,n9;2 a2 be eligible as directors OF banks of
!. That section 81 be repealed.
g. That the act shall be so amended that no bank
shall eommeqce business @ with less capital aetu-
y. That provision b inserted requiring banks
that may desire to close mp their ataifs, to give
e9 and u na 10 = tic he public a saY 10 may
two years rom ths pa6ilsstion oi such notice. 70
Teaeary of @ % Tnited sotes, the AMOUNT q q ther
outstanding notes in lawful money, which notes
shall be redecnab!e ut THO Treasury and the banks
liability therefor. The benefits resulting from lost
circulation are thus to tnurc to the Government.
10 That m a. act be e e. amended thnt IT, the Eate Of
and the penalty ioE usry be forfeiture Of the in
terest instead Of ths debt: and that the banks In
be relieved in certain contingencies rom ali pen
allies IN order that they mag prcrent, as
far practicable BY raiaing the rate of interest
and heavy e1poFtation Of the prccions Ecta!a. Tho
principal idea Of the sectQn suggested Is, TO cs-
tnbilsh uniform rate Of iEieress throngho9t all
senp len liz Controller thinks there can be II but iite
question az to the power Of Congress to regulate
tho rate which shall be charged by the banks
through which national circulation IL to ba is
sEcd, and which arG Organized under, a national
1aw. Without this power, the Nattokal G0tsrH-
mt1t must GIpidt zcih the Staf6s the control Of the
affairs Of the banks created to carry out its right
full, Acknowledged md necessary functions. As
the 1aw now stands, banks In New 1ork and Mich
aaI eag ssies st a2e ss es h wi" h
uniform rate recommended ia per cent.
II. That section Is be repealed, aud instead
| thereof section be tnsefted authorizing tho
banks to make sems-annual diyfdendt Of profits,
but reqniring them, before dividends are declared
to carry to tic 4surplus' oneexth part Of their
| to 80 per cent. Of their respective capitals.
u. That sections g., 6 and u be repealed. Hc
thinks the sd section Ia calculated to bring the
| national currency system into CONFLICT with the
| States and into diareputc with the people.
1s. That it be made tho duty Of the National
DankF II required by the Secretary Of the Treas-
ury, to set as financial agents Of the Goyernme en,
| to receive On deposit Government money, and to
give satisfactory security for the performance Of
II. That the National Banks shall bo required to
prevent their notes from being deprecated in the
commercial cities Of the country, and that the Na-
tional Dnpks in thcze cities be required to keep
reserve or1awfal money In their own yaults.
This he thinks can DO done, seeing that the
whole resources Of lhe Government are pledged foz
their paper, and II It's eau Sc prevent
cd the currency WI! obtain perfection never be-
fore reached hy bank note circulation.
banking may be attempted under this system, the
holder OF the notes can neyer suffer- for he has not
only the public securities, but tho faith Of the
ton pledged for their redemption.