Morning journal and courier. [volume] (New Haven [Conn.]) 1848-1894, 1893-10-24
THE BANKERS, CONVENTION.

Synopsis Of the Able Paper Read by
President George A. Butler OF tho
Tradesme ems Bank Before the Bank.
ers' Convention.
Following Is synopsis, giving the lead
Ing features in brief, of the paper read by
our townsmsn, George A. Butler, presi-
dent of the National Tradesmen's bank, be-
fore the nineteenth annual convention of
the American Bankers association held In
Chicago recently:
The paper was on "a Practical Plan of
Banking and Currency" in which hs ad-
vocated the repeal of the law requiring the
deposit of bonds to secure notes and the
issue to banks of notes up to 80 per cent.
Of their capital.
Mr.. Butler introduced his paper with
some observations on the non elasticity of
our currency consisting of notes issued by
the government at stated times and in
stated amounts and consisting of coinage
or notes secured by bonds deposited. He
then argued that with system of banking,
the notes of which are not secured by
bonds, the note circulation would expand
and contract as the.business of the country
was more or less active. he then submitted
the following resume, which, while not
pleaded as an absolute security, he be-
ieved would give Aexibility and as good
protection as has ever been possible:
First-Repeal the section requiring de-
post of bonds to secure the notes.
Second-Issue to the banks, notes, say to
| so per cent. of their capital.
ii nf
ton less than $40, unless the smaller notes
are fully covered by coin.
Foursh-The banks to keep q reserve In
specie to the amount of 25 per cent. of the
| notes issued.
Fifth-Plsee tax of one-half of one pc,
cent. on the circulation as q safety fund
out of which the notes Of any bankrupt
bank may be paid in case the assets of thu
bank are not sufficient to pay all the deb
| of the bank.
Si1th-Remove the department. of thu
| comptroller of the currency to the city Of
| New York; the % per cent. reserve fun6
| to be kept there also.
Seventh-It would be we'll te fx tn.
! amount of capital that bank should hav,
| II 1t is to issue notes. It should be sui
.fciently large to be a guarantee of thl
good faith Of those engaged in 1t. Two
hundred thousand dollars will not be I'm
fair to any place desiring a bank.
Eighth-Before issuing a oertificst,
authorizing bank to begin opera
| ton, the comptroller of the cur
1ency should make a careful s1amina
ton as to the means and character of al
those proposing to start bank.
| Under such plan as Is here contena
plated not one dollar would ever be lost t,
the holders of bank notes. A recapitula
Il I'll ,,nfv1 n III
not the least need of deposited collateral
for the notes.
First-There will be the capital and sur
plus of the banks.
Second-The liabilities of the stock
holders to an amount equal to the pa
value of the shares owned by them.
Third-Ths circulation would be TO
only 80 per cent. of the paid in capital.
Fourth-There will be the coin reserv
; for IS per cent. of the whole amount c
the notes issued, the amount which wi
always be greatly in excess of the amour
at any time actually in circulation. Th1
sort to the assets of the banks must /
had in case of failure to 60 per cent of tt
paid up capital.
Fifth-And finally there will be adde
to the security mentioned the safety funt
which will always be accommodating, out {
, which the notes of an insolvent bank ca
, J be paid in the event that resort to 9th,
| means should be inadequate to their fu
| payment.
, Mr.. Butler then proceeded to elabora
/ and explain the plan above outlined. E
! concluded:
81 believe the ultimate struggle on tt
currency question will be between q go,
eminent issue and bank notes, as betwee
the two almost any kind of bank notes wi
| be less disastrous to the country than 8
, Issue of government paper. One came
contemplate the government again putin
its printing presses into operation withor
, | the yreataat annrah an sian and alarm