The morning news. [volume] (Savannah, Ga.) 1887-1900, 1891-07-15
nae National Ranking svatem.

There is some hostility 20 the national
banking system in different parts Of the
country, but not enough to justify a doubt
as to its continued existence. That 1t Is su-
perior and, in most respects, much more de
sirable than the old system of state banks
there is no doubt \ bill Of any national
4 bank is good for its face value IL any part
Of the country. The fact that the bail IN
whose behalf it WIS issued Is no longer
solvent does not affect 1t in the least Onaer
the state banking system the pubic was
always in doubt as to the value oil the oahK
bills IN circulation
The national ba king system has been in
existence nearly thirty years and has gwen
very general satisfaction. But 1t Is not
perfect system by any means. 1t ought 70
be improved. and experience has shown
wherein it can be changed for the better.
/ Changes have been suggested which would,
his believed remove whatever hostility there
/ istoit. The farmers, for instance, cannot
get money from national banks on real
estate security and that Is about the only
security they have II the banks we're
permitted to accept real estate mortgages
ground of complaint against them.
And there is Il feeling that the govern
ment does not watch the banks as closely as
it ought. The depositors in the recently
wrecked Keystone Bank Of Philadelphia
would not have lost so heavily if Bank
Examiner Drew had discharged his duties
faithfully. lie asserts that he did all that
was required of him, but the records of the
controllers office do not sustain his asser-
ton. Ii Is not improbable that the charge
that he was a borrow er of the bank and
was in the power of the president is true.
But it is not in the power of the govern
mont to get honest and competent men for
bank examiners in every instance. And
even if all the bank examiners could be de-
PENDED upon, dishonest bank presidents and
cashiers would be able to deceive them
sometimes And rascally bank officials
have been rather numerous in recent ears.
In the July Forum J. Selwin TAFT has an
interesting article on National Bank En-
bezzlements. According 10 his figures there |
were 55 separate cases of defalcation in |
national banks for the nine years ending |
with 1886. The amount involved in these |
was $3.50, TAI. Among the |
defaulting officers were II presidents who |
embezzled S., lS4, 500; 21 cashiers who stole |
50, TBS, 600 and 9 tellers whose stealings |
amounted to 1862, 600. No correct informa- |
Iion Is obtainabe relative to the defalcations |
since 1850, except In GASES where the banks |
were wrecked. In these cases during sthe |
four years which followed 1886, IL of the 81 |
failures were due to frauds of bank officials, |
II TO excessive loans to bank officers, 2 to bad |
and to decay of trade. TIE |
record of the present year, however, Is about |
the worst of any year in the history of the |
banking system.
Mr.. TAFT, in his article, expresses the |
opinion that there are too many indie |
pendont national banks. He calls etten-
hon to the English system, which has a few
great banks in the commercial centers and
many branches distributed throughout the
and he thinks there would be
ever defalcations of bank officers and a
much less number of bank failures if there
we're seventy-fve or one hundred great
national banks scattered throughout the
country, each having as many branches as
4he business Of the territory tributary de-
handed.
1t is doubtful, however, If Mr.. Tait's sug-
yestion would meet with very general favor,
out there is no doubt that congress could
introduce such reforms into the national |
banking system as would make the system |
more acceptable and limit the number Of |
bank disasters.