Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1867-11-15
yEnPUlS APPEAL
CUR NATIONAL BANKS.
LETTER FROM JAY COOKE,
THE BANKER.
The Origin Of the National
Banking system.
The Present Position Of the
Banks
OUR NATIONAL BANKS.
Iv.-PREsENT POSITION OF THE MA
TIONAL BANKS.


! Iv.-PREsENT POSITION OF THE MA
TIONAL BANKS.
Those banks that have changed from
the State to the national system, having
pivep up their former anu much largsl
liberty OF circulation and deposits, TO-
getber with the new banks, find them
selves threatened with being deprived,
not only Of their national circulation,
but also Of their positions as fiscal agents
Of the Government.
The profits of the banks durisg the
war, like those Of almost all branches OF
/ busin ness, were large and unusual; but Is
matters now stand, think only ex-
press the opinion Of Usnk officers gene
rally when I state that, in view Of the
aggregate of taxation already imposed
! upon their profits and business, the Ma
/ tional Banks cannot, for the immediate
! future, declare average annual dividends
I OF more than seven per cent, and do a
I safe and legitimate banking business.
These National Banks constitute now
| our only system of banking, and are in
/ terwoven with all our business and in
dustrial interests. So far as the officers
and stockholders Of the National Banks
are concerned, venture TO express my
beliefthat large mRjorityoi them would,
I if it were q mere question Of profit, gladly
return to the old State system, could they
be assured OF the same privileges Formerly
enjoyed under il. ATs our merchantsi
farmers, mechanics and workingmen
generally prepared for such change?
For such n change they will have il they
do not rally to the support Of the Ma
rional system. Already, / understand,
an enabling act has been applied for, or
has been obtained, from the Legislature
OF New York to enable the banks OF that
powerful commonwealth to return TO
their former condition as State institu-
tious. The fact is, the stringency OF the
National banking law, the reduced lib
ertv Of circulation, the compulsory re-
serves Of funds, the State and National
taxation-aIl combine to render the pres
eut system much more favorable to the
peOpie, aud less attractive to the banker,
than that formerly in vogue.
The number Of National Banks now in
existence and in good standing is 1889,
having an aggregate capital of S425, ,4ll,-
SOL. THE number Of National Banks
used as DepositOries of public moneys is
3SS, having an aggregate capital of $780,
600, 600. These Depository Banks had on
deposi. at Washington, July l, 1907, as
security for Government deposits with
the banks, United States bonds OF vsrl-
Ous issues amounting to S39, Hos, ,+5O, u
secure a total amount of Government
deposits at that date Of SO, I64 Oo9 W.
The average amount OF non-lnterest
hearing legal tender notes held by the
banks during the past fiscal quarter was
SR2 43I. 500. The National Banks have
on deposit at the National Treasury, to
secure their circulation, six per cent.
bonds amounting 70 S26l Al $50 and five
per cent. bonds amounting to $50, ,26S, 100,
being a total of $40, 700 $50, with which
to secure an aggregate circulation of
$500 900 900 The National Banks that
have failed since the inauguration OF the |
system are nine, having an aggregate |
capital Of 81 500 600. Twenty-three |
other banks have voluntarily gone into |
their aggregate capital being |
s., 1850 600
Regarding the failure Of National !
Banks q word is sufficient. Some Ma
tiOnal Banks have failed and others will |
do so in the future, for the simple reason !
that in any business and with any sys /
TEN it is impossible TO guard, st all |
times, against the cupidity and dishOn- |
eetv of agents. II s dishonest bank /
officer chooses to aOscond with the funds /
of his bank, it is difficult to see what |
remedy there could be under any sys- /
tenn. But under the national system the |
security against accidents Of every kind /
is as nearly per ect as practicable, and is /
a vast Improvement over the old plan. |
For under the present system the bill 4
holders are completely and always Sc
cured against every possible accident, /
while dep0sitoTs have far greater secu- /
rity than under any former system. /
n
terested only in the security Of cireu- |
lating notes of the banks, for these are /
in every mans pocket, and they cannot l
be affected in value 10y anything the /
banks may do, the Government being /
pledged to their redemption. Ii is also /
instructive to note the very small mum |
ber Of failures since the change from the I
old system 20 the new, emily nine out Of /
nearly seventeen hundred having failed /
in four years.
V. SUPERIORITY OF THE NATIONAL BANK .