The Wichita daily eagle., 1891-09-22
KANSAS BANKS.

TOPEKA, Kan. Sept. 2I-Today was The
last day of the six months term given the
state banks to come within the provision;
Of a law which was passed by the last ley
islature and which took effect on the 2lst
OF March. The new statute took shape
out of the confusion and wreck in which
so many state banks found themselves in
volved last fall, when the financial
stringency" began. 1t was found that
banks were conducting business on a sort
of go-as-you-pleaSe plan, and the great
losses which deposItors and other creditors
sustained as a result of such haphazard
methods impelled the public to ask for and
the legislature to enact law which would
protect the people by prescribing rules to
which banking institutions should con-
form and creating an examiner to hold
them under surveillance.
The law requires that within six months
after going into effect, that is to say, by
today, every state bank must file a state
ment of its resources and liabilities With
IN thirty DAYS after the filing OF such state
ment the commissioner is required to
examine the bank, but il will be impossi-
hle for him TO examine within the next
thirty days all the institutions whose
statements are on file. This contingency
will not interfere, however, with the op-
erations of any bank. Having flied a
statement. it has complied with the law.
and it viii 90 on with is business until the
commissioner can examine IL, when he
will issue a certificate of good standing or
close its doors. as circumstances may re-
Quire The commissioner is directed TO
examine each bank at least once a year,
and to call for not less than four state
ments Of ITS condition. He may increase
this number of examinations and state
ments according to his judgment. Up TO
Saturday 300 banks had filed statements
and $50 of them had been examined
There are about 900 that were expected TO
report today Besides these, fifty-three
new institutions have been chartered
Under the old law banks capital was
$50, ,00o TO per cent of which was paid in
The new law makes the minimum capital
So. 900. one-half of which must be paid IN
before business is begun, and 10 per cent.
of the residue must be paid in each month
thereafter until the full capital has been
covered 1t must keep reserve of 20 per
cent. OF its deposits. but one-heif of this
may be in the shape OF accounts with
solvent banks This is n feature for the
benefit Of depositors which the old law
did not have Should this provision be
disregarded the commissioner must re-
quire the deficiency to be made up within
thirty days Cnder penalty of receivership.
Not more than ID per cent. Of the paid up 4
capital and surplus may be loaned TO one
person, association or corporation.
l0hnk commissioner JOHnS00 mas al
ready made several important rulings.
among which are that bank shall not ac-
cept certificates of its own stock as collat-
eral on loans, ana the directors shall be
chosen from aTnons Stockholders.
Should bank that has been doing bust |
ness under the old order, and there are
about $50 of this kind, wish to recharter !
under the rev statute, il is confronted by /
a law which forbids that one corporation |
be chartered in the name of 'another-thst
is to say, the Farmers bank cannot take
out n new charter under the name of the |
Farmers bank until the business of the |
old bank has been wound up and the in |
stitution hiss passed out of existence. Tol
permit bank TO retain the name under
which it has established its credit. and To |
prevent the loss incident to closing out its |
business, the secretary of state has
ruled that when the stockholders file a |
petition, asking for the privileges of the |
new law under the old name. a charter |
will be granted.
Commissioner johnson and Deputv |
ShOwalter find that the new arrangement |
will give quite general satisfaction. |
Savings institutions, however. complain |
because they are compelled to carry so |
large ii reserve. The best opinion is ,that
the new law win give sounder banks than
we had before