The sun., 1889-11-26
THE NATIONAL BANKS.
ANNUAL REPORT OF THE COMPTROL-
LER or THE CURRENCT.
An Increase or1ee In the Number OF Ranks,
bat Decrease OF 0B7.Aee,I8p IN the


Al Increase oT16e In the Nun,ber or Ranks,
bat n Decrease OF 0BT,Aee,Iao IN the
observation-disclosures Recommended.
WASHINGTON, Nov. 25.-The forthcoming
report Of the Hon. Mr.. Lacey. the Comptroller
OF the Currency. covers the year ended Oct. 81.
1889, ut which time there were in existence
9.319 national banks, the largest number in
operation since the inauguration Of the system.
These associations possess an aggregate capt.
tai OF $620174,385. Within the year 211 banks
were organized. SO Of them in Texas, the
largest number in any one state. The State Of
Pennsylvania has now the largest number Of
associations in operation. Massachusetts, leads
in point OF capital stock and New York in ro-
spect to deposits and volume Of business.
The large number OF new banks entering the
system, and their wide distribution. is an evil
deDce, tho Comptroller says. that the system is
adapted 10 the varied conditions existing with
in the extreme limits OF the national domain.
Within the year Al banks went into voluntary
liquidation, and only two failed. leaving the net
additions to the system 1853, as against 90 last
year. and 1913 the annual average increase
since tho inauguration Of the system.
Notwithstanding this gratifying increase.
says the Comptroller, investigation OF the facts
demonstrates that the system has no. kept
pace with the necessities OF the people for In
creased banking facilities. as is evidenced by
the marked increase IN percentage OF State
banks 9TSapniSed the last iys years as com
mediately preceding. This growing tendency
to incorporate under the etatutes Of the eev-
the law affecting either national or State, in
stitutions, but is charged directly to the fact.
sH the that no T5o dss sssus t
bonds and Issue Of circulating nutes. 1t is
demonstrated through tables prepared by the
greater than 4.7S per cent; As the PREVAILING
It follows, says the Comptroller, that in the
greater number OF States, and In those increas-
enforced deposit OF bonds to secure circulation
is an impediment in the way Of organization Of
msS 6e Soums So mas Of sssd b the
banks already iu existence. In confirmation OF
the statements made, attention Is called to the
circulation during the year was $37,4s6.l39,
and that the deposits OF bonds of tho new banks
% ,b d1rIS the year mere only In
OF the $146,47l.7OO United States bonds held
rs security for the circulation OF nationai
the minimum requirements. This excoes on
Oct. 4, 1883, was s79.S79,2 220, showing a de-
s II Is deemed cetsn by he COMP
troller that this withdrawal of bonds held In
excess OF the minimum requirements, Will con-
and It is asserted that legislation is necessary
to prevent. a contraction OF the volume OF ma
In In the % opinion OF Of The Comptroller, the laws
governing national banks should be so amend
ed as to produce the following notifications:
ton sSoud BE- 1ed az 70 per H eenum 70 Of capital IN re-
Speet to associations having capital of $50 10 ess
boads be tqaed
Ciscua,o9 should o' Issued to the par value of the
semi annual duty on circulation should no so re-
It is hold that these changes In the law would
do little more than save the national banks
from loss on account of circulation II the present
Taking as basis OF computation the capital |
stock as 1t appears In the summary OF reports |
SeDt &c. dsS9 the 81 in saE a1 osd q de-
The law is amended as proposed the minimum |
p bond deposit required will be reduced to |
l51 .405.702 in bonds upon which is based $46- |
IN circulating notes; 1t Is asserted that
his would greatly exceed the limit ofprnbable
Comptroller. that the banks now maintaining
leposit IN excess OF legal requirements would |
| careful survey OF the entire field. 1t is the
opinion OF the Comptroller that the proposed
M as rSher an ea accs no
ratc it, for the following reasons:
J. Tho present excess now hold at loss will proba
The Ssnts bow Down holdns Hten an excess will no, av.
themselves OF the privilege or withdrawal conferred by
he reduction OF tho minimum.
3 The organization OF new hanks will be nearly or
uite doubled and the deposit OF bonds recoived from
his source will be maintained under the reduced
eQuirementR
Tho withdrawal OF bonds by reason Of hanks going
nto voluntary liquidation will be greatly reduced
D The addition or ton per cent in circulation will
ty to all BONDS now on deposit as well as those Which
nay hereafter be pledged. ana would add nearly Sl0
w. oto to tho circulation upon present ho!dngs.
The operation OF these various influences.
he Comptroller says. would tend to prevent
ny considerable reduction in the amount of
'onds held to secure circulation, while the in |
reased percentages OF new issues would
perate to neutraliZe the effect OF any possible
withdrawal and might initiate rather than
ontrnct the total volume OF national bank
In any event the provisions of
ectlon 8 OF the act Of July IL. 1882. no says,
vould still be in operation. limiting the de-
osit Of lawful money or withdrawal of bonds
o 600 during any calendar month. which
you'd limit possible contraction to S36. 900. 900.
Vhlch Is less than the gross decrease Of circu-
alton during the year Just closed.
The reduction Of the duty on circulation Is
upon the ground tha: the present
ak Ia unjust to the banks. because It Is i'm
osed on account OF q privilege now valueless,
nd the revenues OF tho government are in OK
ess OF it's requirements. This semi-annual
uty during the last fiscal year amounted to
]. 1.410.331.S4. and the total amount paid In
'ederal taxes to June 80. 1889. by the system
n capital deposits. and circulation Is stated
I $l37, 664 1857. The reduced rate OF duty
Iould produce sum In excess OF the expen-
itureS made by the general GOyeTnmOnt on |