The morning news. [volume] (Savannah, Ga.) 1887-1900, 1893-12-04
ECKELS AND The BANKS.
The Controller Of the Currency Makes
His Annual Report.

Suspended, of Which SO Resumed.
The Clearing House Certificates.
Washington, Dee. 3.-The annual report
of James II. Eckels, controller of the cur
rency, which will be submitted directly
to congress tomorrow. differs from for
mer reports, in that no tables appear in
the body of the text. 1t shows 1856
national banks to have been in operation
at the close of the fiscal year, with cap
ital stock of S695, ,55S 120, represented by
7,4500 600 shares, held by 100000 share
holders.
At the last report of condition The total
, resources of the banks then in operation
was -, l09, ,5632S
The total amount of circulation was on
Oct. 81, S209. 81 1873, net increase during
the year of S36, $50, 972
During the year ll9 banks were organ
| lied in thIrty-two states anu territories,
! with capital stock of Sl1 $50, ,0J0
Within the same period l5S banks sus-
/ pended With 4 capital Of $50 300, eco. OF
! this number eighty-siX, with a capital
! stock OF SIS, S,250, 900, resumed, and sixty
| five passed into the hands of receivers
! with a capital stock Of .l0,SS5,G0o. At
! the close Of the year seven remained in
! the charge OF examiners, pending resump-
! tiOn
| The aggregate resources or liabilities
! on Oct. 3, 1892, the date of the last report
! OF condition. compared with those Of
! Sept. 30 1892, were $500, ,53l ,6I3 less.
THE POLICY OF LENIENCY.
Upon the question of the suspensions of
national banks during the year, the con-
troller says:
! With a full knowledge of the general
| Gp1t of
| which brought about their suspensions, the
| policy was inaugUrated Of giving banks,
| which under ordinary circumstances would
| not have closed, where the management had
! been honest, an opportunity to resume bust
| ness. This policy was one which seemed to
| commend itself to the controller as proper
| to pursue under the circumstances and it is
! believed the result has justified the expert
| ment of its adoption.
In no instance has bank been permitted to
| resume on money borrowed. or for which as
| an ASSOCIATION it has become liable. When
| ever those active in the management reSum-
| ing, either as executors, officers or directors
| have been debtors, their Indebtedness has
been paid or secured and when
! has existed such impairment has been
| made good either by voluntary or enforced
assessments on the shareholders. In num-
| her OF instances changes nave been made IN
! the directory and official corps OF the bank
| The one general criticism, however, to be
| made upon the management Of these banks
circumstance which greatly retarded the con-
| version of such loans into cash, and thereby
| causing suspension.
CLEARING HOUSE CERTIFICATES.
The matter of clearing house loan certi-
ficates is briefly discussed. Upon this
| subject the controller says:
Briefly stated, they were temporary loans
| made by the banks IN each city issuing them
| associated together as clearing house assO-
| citation, to the members Of such association
| and were available to such banks only for the
| purpose of settling balances due from this to
| each other. these balances under normal CON
| ditlons Of business being always settled in
| coin or currency.
At time when vast sums of coin and cur
! rcncy were being Withdrawn from the banks
! to be boarded, these loan certificates, by per
, forming the functions OF currency or coin to
the legimate and current demand Of business
| unQuestiOnably p aced ii in the power OF the
banks in the cities named to extend to out
| side hanks the aid needed on the one hand
and on the other literally extended. In no
| instance were these certificates designed to
nor did they circulate as money. They were
| but due bills and their sole function
! consisted in the discharge o. the single obli-
| cation at the clearing no s.. An attempt on
| the part OF any bank III any OF the aSsocla-
| tiOus issuing these certificates to use them
otherwise would have incurred fire and
other penalties provided in the
rules governing such associations
Their issuance at an early date
| in the financial arrangement of The country
was most OppOrtune in not only preventing
! an acute panic but in tending TO restore pub
| that with the mutual agreement Of all, the
| weak banks OF the association would be, so
| far as depositOrs and other creditors were
| concerned, as strong as the strongest.
| In inaugurating the issuing of certificates
/ so promptly. and in iSs ling them to so large
! an amount, the clearing house association OF
| New York particularly rendered the country
| great service. and the associated banks Of
! that city are entitled to the credit which the
! public generally accords them.
CHANGES IN THE LAW.
The following amendments to the law
| are recommended.
J. That eye:y association may issue circu-
| laung notes equal 10 the par value Of bonds
! deposited.
! T. That the semiannual duty on circulation
I be so reduced as to cquul one-fourth OF one
J per cent.
/ g. That the controller of the currency. with
/ the approval of the Secretary of the Trea-
! sury Le empowered to remove oniCeIs and di-
/ rectors OF d oani ior violation OF the law
| first giving such officers and directors an op-
portunity 10 be heard, leaving the vacancy so
! created TO be filled in the usual way.
4. That no executive officer Of bank. or
| employe thereof. be permitted to borrow
4 funds of such bank in any manner, except
I upon application to ana approval by the board
3 That the assistant cashier, in the alb
! Sence or inability OF the cashier OF national
! bank to act. be authorized and empowered TO
! sign the circulating notes Of such bank.
! i. That the law be amended by appropriate
! legislation so as to empower some class OF
+. public officers TO administer the general
oaths required by the provisions OF the bank
| note act.
| T. That bank examiners be required to take
| an oath Of Office before entering upon the dis
charge Of their duties and to give a bond in
| such amount and with such securities as the
controller OF the currency may require.
! 8. hat the controller Of the currency, with
the approval Of the Secretary Of the Treas
| ury. may be empowered to appoint two gen
| eral examiners Of considerable ability and
| experience, to be paid out OF the reimburs-
! able funds whose duty Il shall be TO visit, as
! slst and supervise the various examiners in
! their several districts. in order to secure uni
| formity in method and greater efficiency in
/ work.
| g. That the law be so amended as to provide
| that the com pensatiOn Of all bank examiners
| be liked by the controller of the currency with
| the approval OF the secretary.
CURRENCY LEGISLATION.
Upon the subject of currency legislation
! is the following;
| The controller has been urged to make some
! specific recommendation with respect 10 a re-
| vision Of the law so far as it pertains TO the
! issuing OF currency. After a careful consd.
/ Grafton of the question, the controller is Of
! the opinion aside from the amendments
/ heretofore suggested, that the public good
/ will be best subserved at this time by making
no radical change in the provisions
/ OF the law as 10 stands The financial sltua-
! tOu Of the past nor tAs was not the result Of
| either lacN III the volume Of the currency,