The Republican journal., 1872-01-25
The Savings Banks.

The Savings Banks.
The Savings Banks of this State. which
are attracting a great deal OF attention
Just now, have become very important in
situations. While they were almost I'M
known within our borders ten years ago,
they rave. as result of the change III the
financial system OF the country, sprung
into sudden growth and prominence, until
they number torty-nine, with an aggre-
gate deposit OF almost twenty-three mil
lions. Like many other schemes, the plan
OF banks for the deposit and safe keeping
OF the savings of those who cannot them
selves take care of their funds, has out
grown its original purpose to consider
able extent Persons have availed them
selves OF its privileges and advantages
whose shrewdness and sharpness in mon
ey transactions are quite equal to those
OF the bank managers themselves From
this source some complaints have arisen.
which are now engaging the attention of
the Legislature.
The discomfort with these banks. so tar
~ Il finds expression. NAV be classed un-
der two heads First, that large indivld-
ual deposits partake Of benefits that were
never intended Tor them, and escape the
burdens OF taxation. Second, that money
earned in the State il sent out of it for in
yestment, when capital is needed for bus
mess at home. The first named is an OBJ
lection which became apparent very soon
alter savings banks We're established in
the old countries, + century ago Capital
Is keen AMI sharp enough to avail itself
OF all possible advantages of the kind
without special regard TO proprieties.
The love Of gam IS not usually associated
with quick sense Of modesty The rem
edy applied in England was to coDtiue
each depoSitor to one bank, to allow not
over $50 pound deposit in any one wear.
nor more than $50 in all from one de-
positor Bar il Is doubtful whether q
similar rule Gan be At once applied in this
state The legislature has chartered
these tanks. with their lmmunities and
privileges, ana mas seen them grow 10
their present proportions, without obiec-
tons. while receiving Ind investing these
large deposits. The accumulations have
gone INTO long loans on mortgages. "a q
great extent and cannot be made avails-
Bic 10 repay depositoIs Oh call Asween-
ing enactment striking the dividends from
TINS class OF depositors, would create q
quick withdrawal Of funds. and be *
tremely liable to result in a psnic and
precipitate disaster. Capitalists are tim
Id, especially small ones. and As liable
TO be stampeded HIS herd Of horses II
i uhWlse Legislation that seeks to correct
q small evil at the imminent risk of GREAT
ing a greater one. This matter, if touch
ed at all, should be handled with ex-
IRENE caution, and after tull consultation
with the bank managers. A committee
OF prudent men, to make inquiry during
the recess and report to the next lepisla-
ture, would be far safer and better than
any present action.
The suggestion that a bank should he
restricted in the range Of its loans to the
territory Of the state is one OF those plans
thai Will be found to work badly. or rather
not work at all, in practice. The broad
and general laws of business and finance
are the safe guides in such matters. and
the special enactments that can with ad
vantage apply are few and simple Cap
ltal will 90 where the combined advan-
tages OF talr returns and undoubted So
curity are offered, whether it be Ia the
shape OF bond of the United States. of
the state OF Massachusetts, real estate
mortgage in another State, or in the CITY
OF Belfast. II these conditions cannot be
found within the state lines, they will be
sought outside of it, but naturally home
securities will have the preference with
out law to that effect. 1t may become
4 necessity TO invest abroad, but there is
small danger that such will be the choice
to damaging extent, of any board of
directors. fair degree of prudence calls
for varied classes of investment as one
source Of security. The kind of legisla-
ton proposed in this matter calls to mind
the famous attempt to keep down the
premium on gold during the war by
Congressional enactment, which resulted
IN sending the price of coin almost out of
sight, They might as we'll have enacted
that water should not run down hill.
In conclusion, we cannot think other
wise than that this important matter of
the savings banks of the state and their
regulation, should not be pursued by any
legislative "avenging swords" but should
be calmly considered and regulated by
safe and practical men 1t is a path in
which it is emiuently proper to make
he ate SLOWLY -