New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1883-04-18
SAVINGS BANK INVESTMENTS.
TILE PAGE BILL TO MAKE POSSIBLE HIGHER RAT
OF INTEREST On DEPOSITS

OF INTEREST On DEPOSITS.
TO the Editor OF The TrfoHne.
SIR: The industrious poor who were deposit
tors in the savings Institutions throughout
the state, on January l. 1883, numbered l.Co5,-
s7I They used to get per cent interest
ia the savings banks; now they only get from
pa per per annum with certainty of further
decrease unless some relief afforded TO them by the
Legis This decline In the rate OF Interest arises
from the following reasons:
First reduction OF the legal rate Of interest from
7 per cent 20 per cent.
SecoHd-Ihe inability OF the savings banks TO obtain
more than about per cent Tor loans upon bond and
mortgage.
Third-The constant dminution in the amount OF the
stocks allowed by law TO be taken by savings banks.
Fonr-The reduction Of tho oIinteresi upon the
National bonds allowed TO be taken by saving
banks
Ftn-The demand for all kinds OF United States bonds
and bonds being great that they are NJ hiIh
premiums they cannot be b,ugat so as TO pay more
than FROM 2ia 20 Al per cent per annum
SiIfh.-FroIn the low rate Of interest made by the
savings banks In behalf OF their depositots must Dc
deducted their necessary proper expenses Tor reut ne
clerk hire, stationery, etc.
Serenth-Tho Increase OF deposits during tho year
ending January l. 1888, was $24,3l4,320 and oil this
Douey had TO lle dle Or seek inye,ment In the Same
limited RANGE OF securities now allowed by law. Ibis
Increase was less than the increase for the
previous year partly because Of tho savings banks
have declined take accounts or have advised peo-
plo to withdraw their money.
Thus VIC have a constant increase I'm the demand and
constant decrease In the supply aud this must seAdy
causo p.ces OF securities now allowed by law TO advance
ana long produce aud an explosion TO the
injury OF deposors In Of panic. or OF necessity
It would be impossible for all the savings banks to dis
pose OF all these bonds at the high rates which they paid
for them: and the loss would fall upon the deposofS
remedy only to be obtained Mt the hands oil tue
Legislature and by the passage OF law Allowing uhaer
proper restrictions investments be made In additional
securities those allowed by law THIS can only
be done in OF the following ways:
Ffrst-By providing IN the law Tor proper examina
ton OF securities with power TO the proper public officers
10 approve or 10 reject after thorough examination snd
authority to savings banks 70 nuke selections from
those that have been 30 approved
Seoond-By mentioning by in tho law itself each
security In who1 sayings banks may invest ThS low
ever, has never been Sin State. because was
found to be utterly impactcabe " was tried IL on
neciicut, and produced no good resuts
Tbird.-By taking OF all restrictons-which would be
very unwisc.
Fourth-By providing that savings banks may invest
In and $50 loan upon any securities now allowed ny law
10 be invested In loaned upon by trust companies
This would Substantially leaving tue question ehtreD
TO the respective boarhs OF tho different saw
vestmonts among them In the aggregate ana "ouu DC
subsau tally Withdrawing all STATE supervision ana con-
troll from such Investments
The method fret ntionci has been embodied IN Mr.
Pages Assembly BILL and reported fayorably by tho
Banking Committee OF the Assembly consisting OF the
Hon. Charles >. Cary of Cattaraugus, ana tue Hon.
Messrs. Chllds Of sullivan; Burns OF Qncensi Deiaho'
OF Monroe; McManus, OF New-YOrk; Ferris OF Iloga ;
Reyes, OF westchester; Page, OF wyoming; Clapp OF
Clnton; Derrick OF Rensselaer,, ana Howland' Oh
Cayuga II Is the samo bill reported by the senate
Committee on Banking OF which Senator Jacobs Is char
man. This bill would mako the Governor, Controller
state Treasurer and superintendent OF the BANKING Dc
partment the Board to examine pass and approve
proper additional securities before any savings panh
could invest in them and after this Is DONE no savings
bank would be compelled to invest In them but every
Board OF Trustees would have TO examine ana approve
them or reject them for ITSELF
There are one hundred and twenty-seven savings
banks In the State and their trustees are as rule gentle
men distinguished for Intelligence proby and financial
ability and thoy safely trusted to manage the
savings boards OF directors 81 banks
and trustees of trust companies to manage their respec
tive affairs Tho latter have always had much more AIS
cretion In regard TO Investments than savings pAnk
trustees and no one else has been found to complains
savings bank has no capital stooki the trustees are
prohibited by law IRON having commission or omolu-
ments except that an executive onicar, devotins his
whole time 10 the afIairs Of the bank, may have
salary and the trustees give their time ana services