The Abbeville press and banner. [volume] (Abbeville, S.C.) 1869-1924, 1886-03-24


Argument in Favor of n State
Banking Systcsn-.-A United States
Bank Should be Established With
Unlimited Capital.
Charleston News and Courier.
a reporter of the Nevs and Courier had
long talk Yesterday with Mr.. George w. Will
liamS, president of the Carolina savings
Bank, in regard to the reduction OF the capital
asked what, in his opinion, would be the ef-
frcts of the reduction of ca pital and the cau-
seS of reduction, Mr.. Williams said:
regard the reduction of The capital OF the
National Banks at this time as unfortunate IN
many respects. as it will create the impression
that the business Of Charleston is declining,
and that there is not Il profitable use for bank
ing capital here, which is not the fact, as is
shown by the dividends, and the large sur
plus now held by the banks, amounting IN
the aggregate to $G5o,0C0.
"a city or $4,000 inhabitants, wi tn trade OF
SGS 600 UO receiving $50 COO bales of cotton be-
sides large quantities Of rice, naval stores,
lumber, &c, with iueXhausLihle beds OF phos-
phate rock and extensive fertlllzihS coilpu-
MES q big cotton mill and bagglns factory,
with numerous lOcll manufactures. ana Il
coffee importing company prepared to supply
Charleston and the West Wlth coffee crop VI
BraziI-a city with all of these resources
ought to augment rather than decrease It's
banking facilities.
"Whiie the National Banks have reduced
their capital from S!,10o0OO to $63n,OOO the saw
ingS banks of Charleston, chartered by the
state Legislature, have accumulatcu depoSlts
to the extent of S2,500,0O,. This handsome
sum is now being used for Investment and
loans There is also large amount .; prlVate
capital employed here in banking. But ior
these timely sources Of relief the commercial
interests of Charleston would indeed be ia u
deplOrahlc condition.
''All admit that the National Bank Act, cs-
tablshing banks, has given MS the safest anu
l,., IL; "a
ever had. But National Banks were war
measures created TO make demand for gov
crnmcnt bonds. That object has been fully
accomplished, and the banks are no longer a
am sorry to believe, when we Shall have u
National Bank left. The government is fast
paying off its Indebtedness, and 1t cannot and
will not issue bonds to perpetuate banks.
the Peoples National Bank OF Charleston were
est Il uIishcd. they bought government per
90 cents on the dollar, which was readily loan
cd at 10 10 II per cent. very different state
of things exists now. The 6 per cent. bonds
have ali been paid, and the 3S held by many
of the banke are fast being redeemed, leaving
only Il limited amount of the is owned by prl-
yate citizens and savings banks, which will
have to he purchased 10y banks beginning bus
mess and those holding the called IS. AS the
all be lost Instead of giving per cent. as
formerly the interest, including loss Of premi-
um, will be about per cent.-one per cent is
paid for tax on circulat ton.
| "rhese are some Of the reasons that 1ntu-
ence the banks in reducing their capital,
but diminished profits, wilhouta correspond
Ing reduction in taxes and current expenses,
are doubtless the main causes for the reduc-
ton. ,
"rhe National Banks justly complain that
they are excluded by the national laws from
some of the best and safest uses OF money.
They are not permitted to loan on real estate,
n nd InliI nU in loans to one Dlrty or 1lrlll
to 10 per cent OF their capital, and yet they
can invest their whole capital In the bonds OF
railroad companies. National Banks were es-
tablished TO help the government and not the
farmer.
'The savings banks have always found Il
profitable use for money on BOND ana mort.
Ioancd by the Carolina Savings Bank in the
past twelve years on real estate IL mas never
lost q dollar
In reply to a general intcrrogatory as to
whether there is Il demand tor money IN Char
lesion. and at about wha: rate OF Interest, and
MS TO whether there will be Il profitable use for
banking capital here, Mr.. Williams said:
There is Il good demand for money at I per
cent on real estate and for commercial pur-
poses also for loans on real estate located in
ihe country at s ana 10 per cent. AS Is diff
cult TO realize on the latter loans, the banks
cannot safely do much or that KIND OF Dus.
hess; money must he so invested as 10 nave IL
in readiness when wanted by the GepoSitor.
Our merchants and the various manufactur-
ing companies are in the habit Of obtaining
the most Of their discounts in New York on
The plea OF getting money on better terms
there than in Charleston. They say they
would always give Charleston the preference,
and save the Inconvenience or going 70 New
York. If they could he accommodated mere.
The New York banks loan the people OF the
South mainly their own money, as 4 conSlder-
able amount of the deposits of the New YORK
banks are bclauccs due to Southern banks
and bankers.
AS to the profiiallencss of banking in
Charleston I am satisfied that capital invested
in banking, economically and judclously
managed. will in the future as IN the past pay
reasonable dividends. 50 well SailShed am
of this tact that we have just doubled The cap
ital of the Carolina Savings Bank Of Charles
tOn leaving the surplus of SS5000 on hand
which has been accumulated in 4 few years.
It is probable the capital will be increased at
an carly day to the full extent OF its charter.
'"I AM of the opinion" continued Mr.. Will
iamS, "thatt tie payment OF the United states
bonds will gradually reduce the NUMBER OF
National Banks until there will be none lett.
one is the establishment of II United States
Bank the other is guaranteed Circulation
by the States, or circulation issued by State
authority, as existed under the State banking
laws before the war;
1--WE shall then have q United States Bank,
with capital of one hundred million OF dol
lars. Oar government ought to eStabilsh a ma
tioual institution, worthy OF this great nation,
France. 1t should be the fiscal agent of the
government, receiving and distributing. all
the public funds. to he under the conirol on
the government, and have the monopoly OF IS,
suing notes for circulation, payable IN golo
and silver, and giving currency equal 10
gold or silver in all parts of the United states.
The bank should be located in Washington,
with vaults capable of holding the precious
metals of the world, held mostly in bullion
in bars too large to be Carried in The pocket.
There seems to be less and less use each
year for gold or paper for the payment OF
debts. 1t is popular and also convenient TO
have "a bank account Debts arc now maln-
ly paid by bank checks. This largely lncreas'
eS bank deposits and lessons the rlsk OF keep
ing money in the pocket or."Slocklng," or 1or
currency. While the banks are prepared 10
pay specie, gold has almost ceased to be II cir
ca ating medium IN Charleston, there is a
constant demand for silver II we could have
an honest silver dollar it would he y popular
currency, especially among the freedmen, 1t
makes them feel rich to have tho silver dollars
jingle in the pockct
The State Bank system In the southern
and perhaps as perfect as anything could 20,
outside of National Banks The laws rcGula-
ting banks in South Carolina gave satisfaction
throughout the country. aff'rding. as they
did, Il sound currency and ample accommoua-
tion to The people. 4 Bank OF Eharlestoh
note was cnri ent from Maine to Texas, and
even circulated in England and on the conti-
nent of Europe. For more than hall centu-
nv the failure of q bank chartered by thcStatc
LEGISLATURE of South Carolina was unknown.
They were all banks OF currency ISSUES. Inc
capital of the hanks in South Carolina was
$lS,GW.OOO, with q circulation OF Sl0,0G0,O0O.
Bank capital was exempt from taxation by
State or municipal authorities. his enabled
the banks TO declare satisfactory dividends
and make loans at low rates of interest"
"Wcll, Mr.. Williams, what about the state Of
trade and the future prospects of Ch;trlcston:
": am tired and busy now,' replied MIR.
Williams but come back when we get the
State Banks in successful operation, and that
hin Limit ed St.tpS Bank. with its hundred mill