Jamestown weekly alert. [volume] (Jamestown, Stutsman County, D.T. [N.D.]) 1882-1925, 1892-12-29

The M0afS' INSTITUTION NOT IN a
Satisfactory Condi-
ton.
Much valuable information about state
banks and the state banking law is to be
found in Public Examiner Wallace's ex-
ceilent report to the governor. The law,
although in force but comparatively a
short time, the report states, has proved
of great advantage TO North Dakota,
having added $1,OOO,OOO to the state as
sessed valuation. The public examiner
recommends that the minimum capital
of the state banks should be increased to
$4,000.
There was omitted a clause, in the Gu
crossing of the act, providing for MIN
imum capital stock in the towns of over
1000, and under 1000 population. This
the report says should he inserted in the
law.
1t is strongly recommended that the
public examiner should be given the
same authority over state banks as the
comptroller of the currency has over
national banks, viz: to at once take
charge Of and appoint a receiver for
banks found insolvent.
A limit of the amount invested IN
banking house, furniture and fixtures
should be made, as many smaller banks
have large proportion of their capital
tied up in this manner.
There is no provision in the present
law for the issuance OF state bank cur
rency, should congress repeal the tax of
ten per cent. on the state bank circula-
tion. In case such restrictions are re-
moved, the state banks should be in po.
sition to take advantage Of the fact, but
the legislature ought to carefully guard
the interests of the people IN this matter
and take every precaution to make any
future issue of state bank currency as
sound 40 possible. The examiner rec
commends that the amount allowed
should not exceed Is per cent Of the cap
itAl; that bonds should be deposited with
the state treasurer in an amount at least
ton per cent greater than the circulation.
II the bonds we're limited to state,
county and city securities it would have
tendency to strengthen the value Of
such.
Regarding usury the examiner recon-
mends an amendment to the present law.
Great injustice is done borrowers OF
small amounts by the present state usury
law. The penalty for usury, under the
national bank law, is double the amount
of such interest, while the state penalty
is forfeiture OF the entire debt, fine
of 800 for each conviction, and imprison-
ment OF the violater. The examiner
says this law is violated every day.
Should person cf small means desire to
borrow 525 or $50 dollars for short
time, the state bank can not afford to
make the loan for the small sum the
legal interest would amount to. The
national and state banks should be
placed on an equal footing in this mat
tor. "The usury law" the report states.
"has not had the effect its promoters
claimed, for money like all other COM
modities, is governed by the law of
supply and demand"
The examiner says that the duties OF
the office have been greatly increased by.
the passage of the state bank law and
the compensation therefore is not at
present sufficient. The examiner is re-
quired to examine and investigate the
state institutions twice each year, the
state officers once, yearly, the county
Offices once, and attend to much GORE.
spondence. 1t is not possible for one
man to properly perform all these duties.
An assistant is recommended and an
increase of $225O for necessary clerk
hire and expenses, as the examiner is
required to be on the road most of the
time. It is recommended that the state
banks be required to pay small sum
for examination according to their capital
stock.
Four banks have gone out of business
during the year, or have been succeeded
by other banks. The Dawson State
bank. having lost the confidence Of the
public, was closed up by the examiner
and it's charter forfeited. The only fail.
ure was OF the Farmers and Merchants
bank at Ellendale, which failure was due
to inexperienced banking methods and
TO the purchase OF assets far in advance
Of their value. The stockholders Of this
institution will be about the only losers.
Two dividends, one of Is and the other
Of 25 per cent have been paid by the re-
ceiver, and q third is promised soon.
Regarding the E. A. Mears institutions
the examiner goes into some details in