The Memphis appeal. [volume] (Memphis, Tenn.) 1886-1890, 1886-03-20
1.-THE BANK QUESTION.
now THE BANKS OF NASHVILLE
LOOKED At IT.
The BIds They Made Ia the COuu'
ell OF That city In De.
cember.

The action OF the City Council in
deciding to place the public funds in
the hank which would agree 10 pay
the largest interest, giving a sufficient
bond for safe keeping, has called
forth great deal OF discussion, and
was a leading topic en- Change yester.
day. The measure has its friends and
its opponents, and the reaf ons given
on either side are almost equally
strong, On the one hand 1t is urged
that il is dangerous TO say that the do
post will be placed in the bank offer
ing the greatest rate of interest, be-
cause the bait would be tempting
one to q failing institution, and fur
Their that bond, however good ii may
appear to-day, may be worthless to-
morrow, or 1t may be declared void on
legal teChnicality. On the other
hand, it is urged that the banks, no
matter how large their stocks, have all
their money out at certain periods OF
the year, and while perfectly
good, could not stand the
run OF an hour; that II is to the bond
at last that the city should look, and
that II could be drawn so that it could
not be broken. With these facts II
would be safe, they say, to risk max
ing couple of thousands, the run.
ming deposit being about $4,000. 1t
might be OF interest in this crisis to
know what the Nashville banks
thought Of the matter and how they
bid when the same question was re-
Gently before the Council OF that city.
The Fourth National Bank, follow
ing the precedent Of the basis OF
award two years ago, made "a offer
for running deposits and leans, pro.
posing TO pay the city 55-l0O per
cent. interest on monthly balances,
and TO lend the city money at 6 per
cent. President Keith, in addition,
said "If other plans, differing from
the above, not merely in rates, but IN
methods and conditions, are enter
tanned, then we respectfully ask that
we be permitted TO compete on the
basis Of such plans"
The First National Bank made a
broader sweep. Itmade a proposition
based on the same plan on which the
award ID them was made two years
ago, and in line with the letter OF the
recorder, saying:
!. We will pay Al per cent, per
annum interest on daily balance, aud
will charge Al per cent. interest upon
all amounts needed by the city for its
ordinary expenses.
A comparison OF the propositions OF
the two banks on this basis showed
plainly that the offer Of the Fourth
National Bank was better for the city.
The First National made, in the
came bid Of December 10Th, these two
other propositions, which bad no. been
embodied in the award Of two years
ago:
We will pay 81 per cent. interest
PER snnum upon all moneys remain
ing in the bank arising from the sale
Of the water.works and bridge bonds.
After such fund is exhausted for the
regular account we will pay no inter
est, and make no charge for moneys
advanced the city for ordinary eX.
pensee.
8. In view OF the fact that the funds
arising from the sale OF the bridge an1
Water-works bonds may remain, in
part at least, in the treasury OF the city
till July, 1886, We will pay in lieu OF
all other propositions 5000 for the
whole deposit ofthe city for the next
tE o years.
The Fourth National Bank, after the
propositions were in the hands of the
committee, learning that the First Ma
tional had made two offers which the
former had not touched, framed prop
ositions on the same basis. Fhess
new propositions were:
?. We will pay per cent per an
mum upon all moneys remaining in
the bank arising from the sale of
water. works and bridge bolds. After
such fund il exhausted, for the rsgu.
lar account we win pay no interest,
and make no charge for money ad
vanced the city for ordinary expenses.
3. In view Of the fact that the
finds arising from the fale of thu
bridge and Water-Works bonds may
remain in the treasury Of the city TIL
July, 1886, we will pay, in lieu Of all
other propositions, the sum OF $1,000
for the whole deposit OF the city dur