The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1886-12-01

neous bonds, the securities of small cities, local
corporations and mortgages of 0ver-yalued real
estate. The savings banks Of Massachusetts,
Connecticut and New York are prohibited from
holding these miscellaneous bonds, and In conse-
quence brokers dealing in this class Of securities
have looked TO Maine as their principal market,
and to our savings banks as the receptacle to alb
s0rb them.
These bonds have no measure of market value
other than the price agreed upon between the
broker and the bank IN barter trade at such
times as the former makes his. pilgrimage to the
counter of the savings Institution
These bonds are so little known that no market
price for them is ever established they never APP
preciate In times OF buoyancy In Values and they
are positively nconyertible in general financial
depression.
Managers of savings banks need only to review
the record Of their predecessors and associates in
this State to find convincing evidence that the fu-
lure growth and prosperity OF their institutions
largely depend upon restricting their Investments
70 such securities as have well defined value on
the exchanges of the country.
No financial panic can disturb the confidence Of
the public in savings banks whose assets are COM
posed of carefully selected mortgages of real es-
tate within the Limitation of statutes; of cred
its Of municipalities and corporations Of this
State; of first mortgage bonds OF railroads which
earn and pay regular cash dividends upon their
stock; and bonds of such cities as Boston, Chica-
go, Cincinnati, Cleveland, Detroit and st. Louis,
which not only have high credit throughout this
country, but whose securities are bought andisold
on the exchanges OF London and Amsterdam.
EVANSVILLE, IND. BONDS.
On this subject the Examiner says:
The task of refunding the debt of Evansville,
Ind, has been undertaken by Boston banking
house. The savings banks OF this State are
holders OF that portion of the debt known as
redemption bonds, to an extent exceeding $780,
600. The basis Of readjustment submitted for the
consideration of the creditors is substantially as
follows
The per scent redemption bonds shall be ex-
changed for an equal amount of 41a per cent 20
years refunding bonds The per cent redemp-
tion bonds to be exchanged for corresponding
amount am oi per cent 20 years refunding bonds;
its face value, in the above described refunding
bonds.
The population of Evansville in 1880 was 29,-
2S0; the assessed valuation in 1882, s21 236, $40;
the debt about 81 100000 or $6S to each ndvid-
ual resident Since 1880 the population has in
creased to fully 10000, but evidently by perfidi-
Gus manipulation the assessed valuation has been
reduced to S17, ,273, $40. While the debt has been
reduced per capita about slS, the ratio Of the
OF about 41s per cent. By a provision - the
charter of the city, the assessors are prohibited
from leyyng an annual tax in excess of ia per
cent of the valuation.
To Maine creditors, some of whom are taxpay-
ers In cities OF half the population of ansville,
with debt OF 20 per cent. OF the assessed yalua.
ton funded at and per cent interest, a debt Of
more than $1b0 to each individual resident, but
with credit SO high that their bonds sell on 4
per cent basis, and a suggestion Of reputation
would be regarded by the citizens treason. this
defalcation of Evansville seems shameless
crime.
What alternative have holders OF the bonds but
10 accept the pending proposition Of compromise?
III II was mortgage of a railroad or OF real eS-
tate, the law would afford means by which the
payment could be enforced. 1t Is, however, SIM
ply the promise 10 pay of a small city restricted
by statute from levylng tax in excess of ia per
cent of its valuation the valuation to be regulated
by municipal officers, chosen by a people who
have made for their city record which does not
distinguish her for pride or honesty.
OTHER MATTERS.
Under the head of "defalcations and su-
pervision" the Examiner suggests that treas
urers of savings banks should not be al
lowed to engage in private business, and
should be paid sufficient salaries to remove
the temptation of so doing. The Examiner
says also that it is impossible for him with
out clerical assistance to make as thorough
an examination of the banks as is desirable
and necessary to reduce the dangers of a
defalcatiOn to minimum. The Examiner
recommends that the Legislature prescribe
that the bonds of savings bank officers shall
be issued by responsible corporation, thus
relieving the officer from the onerous task
Of importuning his friends to sign his bond,
and giving. to the savings bank reliable and
substantial surety.
The Examiner suggests that it could con-
duce greatly to the careful supervision of
banks to pay the trustees for the time occu-
pied in attending to bank affairs.