The record-union., 1891-09-23
MONBTED INSTITUTIONS.
Facts Concerning the Various Banks
of the State.
The Commissioners Report the Result
Of Their Investigations-Savi
VS.. Commercial Banks.

The report of the State Board of Bank
Commissioners has just been issued from
the State Printing Office. It shows that
uurlng the year nine new State savings
and fifteen commercial banks have en-
gagged IN business. They are:
Sayings-Tulare Savings Bank, River
side Savings Bank and Trust Company,
German-American Savings Bank of Los
Angeles, Farmers and Mechanics Saw
1ngs Bank Of Sacramento, California
Mortgage and Savings Bank of San Luis
Obispo, Peoples Savings Bank of Fresno,
Watsonville Savings Bank of Fresno,
Vlsalia Savings Bank, and Santa Bar
bara Savings and Loan Bank.
Commercial-Bank of Lompoc, Tulare
County Bank, Perris Valley Bank, Bank
of Pacific Grove, Bank Of Bakersfield,
Citizens Bank of Los Angeles, Monterey
County Bank of Salinas, Rideout Bank
of Marysyille. Gridley Agency of same,
Citizens Bank of South Riverside, Bank
of Sanger, Peoples State Bank of Ma
uonal City, Broadway Bank of Los An
geles, Bank of Haywards, and Donohoe-
Aelly Banking Company of San Fran
CISCO
The State banks retired are State
Dime Savings Bank (by liquidation),
Mercantile Bank, Bank OF Laporte.
Private banks retired = Rideout d
Smith of Marysville, Donohoe- Kelly
Company of San Francisco, X. b. Taylor
of South Riverside, Broadway Bank of
Los Angeles [all by Incorporation, e. l..
Benedict of Bodie, G. w. Fox of Muri-
etta and Eos Savings Union of San Diego
Tall by retirement).
a new State bank is being organized at
RedwOod City.
SAVINGS BANKS AS ADJUNCTs TO COM
MERCIAL BANKS.
The Commissioners say, under this
head: The tendency of unused money
to drift from commercial banks into
savings banks has induced many of the
former to establish savings banks in con-
junction with their existing institutions
ana this method IS growing rapidly III
the rural districts. The custom is to es-
tablish savings bank with virtually the
same stockholders as the parent institu-
ton, and conduct it in the same office
under the identical management, at
minimum of expense, and while there
are many Of such twin institutions that
are well managed, strictly within the
law, the custom is subject to some criti-
clsm.
Competition in banking, like ali other
enterprises, has naturally reduced profits
and many interior commercial banks
have deemed it wise to offer interest
upon term deposits, thus undertaking a
savings bank business, and perhaps,
with the high rates of interest prevailing
IN the interior, they can afford to pay
their depositors moderate share of this.
although when the various elements of
commercial banking and savings bank
ing are carefully considered, it may be
said that it is not good banking for either
TO encroach upon the other.
''COmmercial banking has nacpSSaril1 Y
certain risks which do not obtain in saw
1ngs banks, whose funds are mainly the
deposits of the poor, to be held sacred ;
and the legal limitations placed upon
savings banks are such as to protect them
against the hazards incident to and un-
ayoidable in commercial banking.
$50 long as the two are kept entirely
separate and the law fully complied with.
there is no objection, but the custom of
having savings bank merely as an adj
junct to a commercial bank naturally
causes the former to participate in much
that may be undesirable in the latter
Nearly all of such savings banks are or
gained with minimum of paid-up cap
ital, and, there being no law on the sub
Ject, the Commissioners are powerlesS to
enforce their demands for a proper paid
up capital, the organizers depending upon
the strength of their original institution,
the commercial bank, and giving it the
use OF whatever spare cash the savings
department may have.
Many of the interior National banks
have these State savings banks as adj
Juncts, and thereby secure additional de-
posits and enhance business; but these
savings banks, being but departments of
commenclal banks, are subject to such
risks and hazards as the law particularly
intends to protect them against"
BANKS IN LIQUIDATION.
The Pomona Bank has been taken into
court, and therefore removed from the
jurisdiction of this commission.
The Dime Savings Bank, closed by this
commission in November last, has paid.
or arranged for the payment of its de-
positors in full This bank commenced
with capital of 81, GOO, and is a fit illus
tration of the necessity Of law requir-
ing at least S25, coo paid up capital.
The Mercantile Bank, which voiuntar-
lily retired in February, has paid all its
depositors.
The Bank of Laporte applied to the
Superior Court for voluntary dissolution
on the 4th of December, 1890.
The Masonic Savings and Loan Bank
has now been IN the list of liquidating
banks since 1873, and the efforts of this
commission to close it's business have re-
suited in the approaching sale of the only
remaining real estate. 1t is hoped that
matters may be brought to conclusion
ere long, and that this bank appears now
for the last time in this report.
Like the above, the Odd Fellows Saw
ings Bank has been in liquidation for
many years, but is making strenuous eff
forts TO dispose of about $50, coo worth of
real estate, the bulk of which is in one
property, negotiations for which are now
pending. A suit between stock holders
and depositors has also interfered with a
final settlement, but efforts are being
made 10 compromise, and thus end long
and weary work.
VALUABLE STATISTICS.
The report comprises a volume of
nearly $50 pages, showing the condition
of all the banks Of the State, which should
be of vast importance to all engaged in
mercantile and financial pursuits.