Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1891-03-01
On the Supervision of Banks Are in
Favor of Official Control of
State Institutions,
BUT NOT OF PRIVATE CONCERNS,
Opinion in Line With'ths Appointment of o
Commissioner and Examiners BY
the Governor,
AT SUCH REMUKERATIVE SALARIES
As VIII Bring Forward Men of Character and Standing
fer the Positions

Pittsourg and Allegheny, and last night re
turned to Harrisburg.
The evidence of a number of the foremos
bankers in the twin cities was received anC
carefully recorded for consideration. Th,
general tenor of the testimony adduced wa
in favor of a supervision of State banks
with modified and dissentient opinions re
garding the extension of interference Il
private institutions. Coincidentally Com
modore Walton referred to the propos itior
now before the Legislature to give the city
control of the wharves, and denounced the
measure in strong terms. The commission
adjourned to reconvene in Phiiadelp phia
next Friday.
Joseph P. Caldwell was the first witness to
appear at the morning session. He favored
State supervision of incorporated banks and
trust companies. but did not think private
institutions should be examined.
r. S. Smith, President of the Union
National Bank, had similar views. He
thought State inspection Of private banks
would hurt them commercially. Twenty
five per cent reserve fund should be retained
by all State banks.
George A. Berry, President OF the Pitts
burg Bank of Savings, was of opinion that
the bank examiner should be under the
supervision of the Auditor General and
Governor. HIS views were on the same line
as those already recorded.
Captain c. W. Bachelor, of the keystone
Bank. said:
favor the supervision of State banks by ex-
aminers appointed by the Auditor General. and
think that all banking institutions should be
under State supervision and subject to gen.
eral banking law. l think that other banks
should carry reserve fund do national
banks. The formation cf a regular banking
department would be businesslike but as the
law stands the Auditor General is the proper
person in whom TO rest such power.
A. NJ. Brown, President of the Anchor
Savings Banks doubted whether legislation
would keep bank solvent and yet might
hasten the failure of bank in bad condi-
tion, He added:
Such examinations as are suggested would,
no doubt. tend TO give confidence in banking
institutions generally.
D. Nick. Lloyd, James J. Donnel, John
Holmes and other bankers expressed views
in line with those in advance of them.
George Sheppard, bank examiner, contra
dicted Judge MELONS statement as printed
in yesterdays press.
The committee ad iourned at the close OF
j. B. Corry's testimony. He said:
think the national banking system good
enc, the best we have ever had. don't see any
necessity Of the State going 20 the expense of
creating similar system when all our people
who prefer 1t can have the benefit of the ma
uonal bank system at less expense than the
State can give it.
Mr.. Cory stated his views regarding the
value Of legislation at considerable length,
An Attack on Senate Bill so.
At readjournment, Joseph Walton, Presi- |
dent of the Farmers Deposit National |
Bank, was called, and expressed himself in |
favor of the supervision of State banks but |
not private institutions. In reply to ques- |
tions by Senator Dunlap, Mr. Walton made |
an onslaught on Senate bill 80, the measure |
TO give the city control of the wharyes.
II. II. Niemaun, President of the Fifth |
Avenue Bank, in reply to Senator Robin |
sons questions said that State banks should |
carry a reserve, aud that the amount should |
be about 10 or 25 per cent. He was in favor |
of limiting the amount of money which a |
bank might loan to an individual or cor /
poration. As the law stood at present there |
was nothing to prevent the entire capital OF |
bank being so loaned. Instances existed |
here where such cases happened.
John W. TAYLOR, cashier OF the City Saw |
lngs Bank. favored supervision by law of |
the State banks, and held that law govern
lng the operations of one bank should |
govern all. He did not think that a State |
banking department would be admissible /
because of its expense. He thought three |
examiners, to be appointed by the Auditor
General on the recommendation of the de- |
positors and bondholders, at a salary of |
i 49, H.
fee under the suggested law. He favored |
the reserve system being applied to State
banks, and thought that it should amount TO
at least % per cent on demand deposits and
10 per cent on deposits where notice would
be required.
John A. Hermann, of the Workingmen's
Savings Bank, Allegheny, favored State
supervision of banks. He thought that
similar enactments as now existed in the
case of National banks would prevent the
making OF false statements. He was in
favor of the supervision of private banks
and reserve in State banks.
Supervision of State Banks Favored.
J. \. Davidson, President of the Second
National Bank, OF Allegheny, favored such
legislation as would tend toward the super-
vision of State banks. He would adopt
the features of the acts regulating national 1
banks excepting as regards currency. He
would exempt private banks because there
were many such enterprises throughout the
State, such as Drexel, Morgan & Co., of
Philadel phia, who would regard such SUPER
vision as an invasion of privacy, and there
were many substantial concerns which oper-
ated as successfully as other business enter
prises. He thought private banking insti-
tutions should be as exempt from
as any other CONNER
cial undertaking, and he would not
draw any distinction between them. He
was OF the opinion that proper supervision
could be accomplished by four or five ex-
amlners, who should be fully qualified men,
and paid at least s., 900 or S., 900 year, and
by the banks. The National Banks pay the
examiner, Indirectly, it was true, and so
should State banks The State must not
have any additional tax to paw except for the
Commissioner and his clerks. Such SUPER
vision would be extremely beneficial; would
healthy tone in business, impart
confidence to the people and be a very good
ming Tor the banks themselves. Mr. David
ION referred to the Penn Bank as having
published statements of its affairs as regu-
arly as the national banks, and said that if
is affairs had been systematically inspected
he result would have been different for a
,ood many people.
As to the Fixing of Salaries.
c. C. Davis, cashier of the Central Bank.
avored State supervision and thought one
xaminer would be enough for Western
pennsylvania, and would fix salaries at
rom S3, 600 to 5000 year. Some small
rivate institutions would be the better of
tate examinations but the larger banking
oncerns would object. At present there
Tas no means of obtaining information re-
ha of