New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1876-04-01


on all or q portion of their deposits. While IL may ne
feasible for the older and larger banks, when nave
large surplus, pay this rate OF interest," Is e'l
that the younger and smaller ones with less aeposs |
small surplus cannot in the existing state OF business
and the largely augmented market price OF rsclasS S
curcs nay this rate and add anything 10 their surplus
fund TO pay less than the old banks Is 10 ulscoui5
deposits 10 pay the same is 10 prevent an aceumua'
lin Tar s1frty fund To discourage deposits is equya-
lent to n dscontnuance OF business. disconIiiu r
ance of business in this lime depression would IN some
proye loss TO the epositors 1t thus becomes
question OF moment whether the maximum rate Oh III
terest established through years OF great nOlhlnu Po
pev Is the proper rate for to-day The conditions are
changed Money In Wallst., which heretofore com,
manded from 10 10 per cent, can now Dc ad at ~
prr cent Municipal and county bonds when formerly
brought only par the market, are now worm dI
premium Securities worth more and money IS Woatn
less Can the banks with safety afford to pay the present
rate 7 Can they earn it egitimatey . 49, h &,
The interest of the deposiiors lies not so az ,h
the amount OF the dividends they may receive ms IN te
absolute security Of the principal III ayutn , atv
acquired by them at the ultimate expense OF me tegry
Of the principal it il very dear purchase Inc
for large dividends has cost in some cases. part Oh Inc
The practical question is, how shall the rate De regn
latedi In moneyed corporations Iong o T
Inc guarantee fund and the dividends may be deter
mined by the earnngs Bt IN shvEs @y lave no re-
rIle obtains. They nave no cdPtii 10y ,rhic they
but the money deposited WIN the br stock in
trade when The bank opens consists In the confidence
the people have in the law which creates IT, ana III te
m who manage it, This confidence IN Tue law ;oes ~ ~
thr extent of believing that II bank Is perltea 10
organize it will be under such conditions ana To-,
can compete with existing institutions without danger W
those dcposng funds with It, me cohhaencq III and md
The belief that they will fully and strictly comply Win
The authority which established the old banks creates
the new II We that six per cent Is gISate
of interest than the new banks safely pay does 1t not
hccnme tine duty OF the State to lower the rate now pl
or prohibit the organization OF ne" bdhksI bu. hc
has already created many comparatively new Dahks III
localities where strong competition exists, exec pohan
in the metropolis They are now tnEdse ~ ,
they are compelled by the action of the stronger banks
Ia ay This rate of Iniee, 90 INTO liquidation snail
they be forced out Is this to Ne the correction o 'o
ilidvIssd legislation which established thcih hu ,l
powered them receive the deposits OF the P,opi"t
II may be urged that the earnlns 9i ihe pS5 I
the dcpostos, and that no RESTRICTION sno1 W ~, %
upon The be paid and the greater ,ne i,o .he
better for the deposition IiS Is uhquo9tlUlD! uuo ,
der ccrtGin restrictions: one oI Wlch Is aiy ,
oil surplus 10 guard against Ohs III the uepI M
OF assets IL may be further cmtu tI't mI NM h
larger banks can pay thc present rIt's 81 Int"I
cause ncr aer and strength they should be peImed
IT, regardless o th" younger ana weaker ones ind
80 doing the greatest good 10 the greatest nunler Is
s,cued This be true To certain degree but leglo-
aiion should look To II nat while the interests o Ho
Great number are protected, injury should result 10
tIe minority the methods by which IT is Effected
THE DUTY OF TRUSTEES
The position of trustee a savings institution Il one
OF except oual responsibility. He accepts trust when
demand, olhim intelligence, integrity, and faithful aen-
ton TO the discharge the functions Of his office His
time 30 far Us may be required, belongs to the depos
tors IFS best efforts TO protect their interests are
pledged 70 them by his acceptance OF the trust not
merely b implication, hut positively and nnfqulVocay'
he enters INTO MS Hturltty Ithtloh IA Co's'C
ation of profit or advantage himself should be dis
cardcd one motive alone should shape and control MS
conduct and that the 10 do his duty, and nothing
less Yielding TO no seductive influences 10 make specu-
ia've loans and Investments promising large returns
thereby Increasing the surplus and strength OF his bank
firmly and steadily resisting all temptations OF tha
character aud planting ms foot ON the rock ol SAFETY 10
stand and battle n need be for lawful prudent anh con-
rcra,yc administration ~ hs nsilIaIo' no wiz I,lh
his reward IN cou,couSnc-, Il rght DONG ana We
tribute OF praise from all Just men.
Inc success, OF savings bank system dep'n more
upon Che p.r-0nal character o Toe trustees Oh te scE
e,.l institutions than upon all othcr cause, conplhe
Hc>'rclN" ana c"frc''Re lrEl.,i ',ip., io' ~, ~,
year, OF experience IN tho pa't ~ w"iAL' .i 'heSo
iu-fui Ou- valuable In shaping the policy oi tf -As
tenn Facts are evolved ana l,sI' oDlH ;, T.,iH
serve n beacon hslis Tor iGlir "' i.o 1870,
latiou, however Nell considered, wall avail To prevent
abuses correct existing evils. unless the true spirit
which should INSPIRE tht '"huu'' "l ,lv ,i'7 ~, -,
comes tho anlmaiiug ana cuhtf"llh- one. me ul'h
OF giving hi wltrul care AMI personal attention, who
pas. Use, permits wrong doing PAGES himself ~ pot
ltc- Ia. aud converts 10 bis o"n Us" toe moneys IN
Trusted. 10 his safe keeping The measure of c'h5ure
trustee, mot attending The meetings oi thr board
80 time ior examining HE book O." The true
cuuGt ou time Ia give wien there ls no
l'S''l Iic j. no law yyn"b compcls any
man d. accept the rustec-hip Of savings bank, bat
De- does 80 voluntarily, tIrrc = both positive enactment
i c ,iall, and Solemn agreement ON ms rari thnt ne
will di-,rr a., duties 10 thr be-t "f MS ability II ne
cannot ind uc ipT this, he certainly can hhd thr 10
r. -u AID let some man WIN proper sense OF me-
ibiis ,son be- that ali such trustees, wherever found
should not stand upon the order oi their Soins Dat ~
SAVINGS BANK SAFETY FCND.
Tho late failures savings banks suggest the need OF
some better and further protection to the ird'iduaI de-
pooi an that afforded by the success In business ola
-u-, bank while the aggregate losses by these failures
An, a insignificant percentage upon the entire assets OF
all the banks in the state, they fall with great hardship
upnu the individual dcpositors In the several failed
banks Any provision for the protection OF doposors
acau-t would DE wise and salutary which worked
mn ,uiusic. Go others more fortunate. suggest that the
law be 80 amended that Sna!l percentage OF the sur
plus ~ all tine savings banks be set apart annually, which
shall constitute a safety guarantee fid for the pro
lection Of dcpost0rs any bank against loss, this fund
10 boz lodged with the superintendent Of the Bank Dc
ut and be invested by him In United states or
Stie stocks with the accumulation thereon, until sut
n,u M .um has been acquired To cover any probable
losses b., the failure OF any savings hahk. Inc
.uuuut wouid no. be large Ouc4luartcr OF one
Der cent paid the surplus now accumulated aud that
mere made. VIII create !uhd suhtrht Tor AL
practical purposes. This would he mutual benefit fund,
and would prove value 20 the syttcn IN many
II would insure the deposition IN any SAVINGS bank The
repayment his money II would uorcas. and intrcuch
confidence the general plan aud management OF These
institutions. nasmuca a, the state would va" sure
remedy Ia case oi failure oil an institution as"' loss
the Individual IL would 40 fir 10 allay excitement
ana prevent runs In times of monetary disturbance,
not only upon the weaker put thc stronger Dahhs.
Experience shown that the runs are often made
ui,cui loss y tho enforced sale Of secuiiic- 10
demands created ~ fear OF ultimate failure, Is the result
To the bdlh. DaNIu- no ttpltss 'ths bi9il'' INV
b,sI. oi ubc confidence only aud largely win the
educated and minimizing Glasses, these institutions are
tcci,ry subject 10 attack, growing out Of panic and
fear II Il believed that knowledge by these propc
itt the 50 lie had provided safety und when would
insure trir deposits would, IN large measure, II not
entirely, prevent such disturbances.
THE GENERAL SAVINGS BANK LAW.
The workings OF the savings banks under the general
law enacted AT the last session OF the Legislature has in
the main. been satisfactory and beneficial! The general
effect may DO in the improved character Of the
4shn nv md
more particularly in the items Of call loans. \ very
I'M ...L.,-.n.Li Inn In. mn Dc m