New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1892-05-17
SELECTIONS FROM THE MAIL.
NATIONAL BANK CIRCULATION.
no PROFIT FROM IT TO THE BANK.


TO the Editor Of The Tribune.
sir: A great number of people stili being under
the impression that the National banks have bo-
nanza in the circulation Of bank notes which Is forced
upon them by the Government allow me 10 submit
to your readers three years statement showing Inc
effect Of the circulation the banks pockctbook,
so 10 speak. As director OF National bank had
access t. the books. and thus vonch for the
correctness Of the figures Our bank started in bhsl-
ness during the month OF May, 1883. with a capital
OF 500 900, and, knowing that no profit was to be
derived from the circulation, We decided upon the
minimum amount prescribed by law, VIZ, S:oooo -
pcr cent OF our capital. Though under the present
system 90 per cent OF the capital may be ths lhNese
there /, hardly a National bank IN the United states
that takes advantage Of this provision Now, In ordcr 10
secure the Government for the amount OF our crcuia
tion We deposited $4,000 I'm United states BONDS
with the United States Treasurer, which, with the
additional premium AT that time ca per cent? neces
STATED an investment OF $}1,1j0. Forty days ai'er
dcpOsitlng the bonds received 80 per cent OF te
amount CO. 300 In new crisp - banknocs. our
10y over this fine lot OF bills became somewhat SUD
ducd when reading the request Of the United states
Treasurer Immediately TO return to him ; per cent
OF the amount ($l125, to be used In the rchemPuoh
Of our notes when presented nj headquarters We
were also notified 10 remit so for the plate from
which our bills had been princd-and IL was gch'!
limited that / per cent of the total amount vi our
circulation would BE- expected OF Us regularly every
year II Government tax.
Thus with $21 ,375 IN hand we started ont 10 reap
the great benefits which, according to simpson ana
lener, were in store for our first years s'ate-
ment figured on the basis Of per cent (oir regular
rate of INTEREST," showed the following result:
LOSS SUSTAINED THROUGH OUR CIRCULATION
Interest the amount Invested In L. - bonds
deposited with u = Trea'nrcr-*3 'oo-i year. oo5 90
Government tny. per cent =, ga; -" W
Drop of premium ON bonds from - " u 90 M
ri per f ynm which our bills were printed 80 90
~, 800
GAINED IN CONSEQUENCE OF CIRCULATION
ngs.s o" u s 6S"d' S %.r ,9%a at 900
Inre,t Citation on rs s73Io @o%shs
20 days-0 per cent-.-..--'.---.. i'ifoV - ~
Hs o'c G,pS cap.Dd between sending bonds and
receiving our circuation)
SECOND YEAR.
the sneg 9e Fg%a9as invested IN $50 90
. I. . bo',s, 81 ~ rcnnt ............. 22J %
Drop Of premium On bonds from 20 to r. 900 90
per cent. 49,
s3,Il5 co
InisfcS on I. s. bond. dcp', .tod at :, 10000
Interest made cur circulation ,so ~ . os, 30
Net loss duiing second sSs- %
THIRD YEAR.
rn,,.,c.t on tho amount r,rniinng invested In ana m
=, ~ a., nor cont ................. rs 60
DGop OF pSc@am On bond, from % u eo2
Itr cent "oV wv
81 SIS 90
Intic.t on U. s. bonds deposited at o,ooo
Washington. $4,000 pr cent --.-tl'ooo"o
Interest mad our circulation no, 70 - oco IN
s2I,375-l year, per CENT. Is oo- 80 ~
~. L.. on,,n, ,ht-, vo,r .............. se7a 80
Thus our bank lost within three years the sum or
- 1913 through the circulation which the Government
forced Us to take. Instead Of being source OF In
come to the banks is believed by many. they suffer
a pccuniary loss through II. Many petitions have
been sent 20 Congress from banks and bankers a>-c
Citations for change In the present system, tu' Az
their pleadngs have been In vain. III" 'hl'u
states Bank Controller. In HI, report OF l-"r states
thnf on account of the high market valnc Of United
states bonds bank, sustained sever" loss rom
the circulation they were obliged TO take under inc
present law, and recommends thai tho system ne ="
changed as rcqulr' only circulation of clVn
and "A deposit OF United states bond, 10 thls amount
Iut 10 the great Of the banks Congress failed
The best proof Of the nnproltablcnc<s Of tho oircu
laon 10 tho banks lies In the fact that the cntiie
circulation Of National Bank notc- within The short
space Of five years dIoppcd rom 20 cdo ooo
Vim. during the same period there increase
Of $50 In the number Of National Tanks In no
case Is the provcIb Not All mat glitter Is pon
o, IT, In spit" 81 MI the proofs To the contrary. inc
dcmarogues continue TO speak OF tho banks as class
especially favored by IL" Government MAY inc.
lines add 10 better understanding Of the matter, and
NAV the farmers who repeatedly based their claims
for loan from tho Government on the circulation
given TO banks. begin to .rc rhrr W ,l4K"
Green Bay, Wis. MAY II. ls9s