The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1895-06-07

puuHt I'LL lH1llkNblul thht Ahu 80 aA
mensc deposit business, principally Of
its Now York Offices. paving thereon q
high rate Of interest both to banks and
individuals. Hundreds OF banks
throughout tho country kept accounts
with thom, induced TO do so by tho
liberal terms received. and whom tho
collapse calno most OF those associations
were go crippled by having such u largo
part OF their RESOURCES tied up In tho
hands OF tho trust company that thoY
Woro bound 10 stop payment, aud wo
need only remind you OF tho recent
failure Of Nicholson & Sons. All institu.
ton established in tho iorties. which,
up 10 tho timo Of Its failure In 1890, waa
considered ono Of tho strongest banking
houses in baltimore. and commanding
tho c~onldonce Of bankers In many OF
tho adjoining states. Its liberal policy
OF paying banks 4 per cent interest no
doubt contributed largely TO ita failure,
and was such q strong inducomont that
many OF II Most Virginia banks kept
large deposits with them, and from cstt'
mates | have made our West Virginia
banks lost nearly ono hundred thousand
dollars, wipingou the entire surplus oil
many.
"Thcse ara fitting examples OF what
usually follows tho practice OF banks
paying excessive interest on excessive
deposits. Unwise Investments and rock
less management aro eOnorally tho
fruits Of such q courso and diastor tho
result.
"We hsyo only 10 look back two or
three years for an illustration Of tho
same character In other countries In
1892 wild speculation had set IN
throughout Australia, and everything
wa, seemingly ut high tide in that biz
island OF the ssa. All kinds OF stock
companies wero formed TO carry on
all kiuds OF trade, and tho shares were
eagerly sought after in tho market, tho
banks ~loaning fabulous sums on this
class OF collateral and real estate sGcur-
ity. Tho banks there evidently bo'
lieyed tho wave OF prosperity in their
respective localities was lasting and sub
stantial, and although they had cnor.
nous deposits, como OF them twenty TO
fifty million dollars each, still the do.
mand for loans was so active and tho
Investments they thought SO inviting
that they used every effort 10 increase
their available resources. offering rates
as high a. five per cent for time de.
posts. and securing their W country
and England to procure them, TO aid,
in building up a structure Commercial
company that, being on q false basis,
finally o]verloppled burying the banks
and depositors in the ono commou ruin.
English depositors sent more than
one hundred million dollars TO the
banks within q comparatively short
time, to be absorbed in the whirlpool,
not a small part OF which had been
withdrawn for the purpose from the
United States, and our mtsiortunes the
following year can in a large measure
be attributed to the loss Of gold brought
about by the action Of the interest pay
ing banks Of Australia.
AT last the inevitable came 10 pass,
and these great banks, not being able
TO bear up longer, in quick succession
closed their doors. owing depositors
several hundred million dollars, bring
ing disaster and distress to their own
and other lands, this country included,
for the demand on US from abroad be.
came more pressing in consequence OF
the crisis in financial affairs over all
Europe, produced by the commercial
and business prostraiion in Australia.tS
"All this goes to provo that, in behalf
OF sound banking, the paving Of inter-
est on deposits ought TO be discouraged,
and to tina. end the aid by restrictive
measures. OF Congress and state leslsla-
ture, should be invoked for tho protec.
ton OF tho banks and the people.
"In conclusion l have no doub. many
OF you agree with me that the payment
of in,eres. upon deposits is no! in har-
mony with the principles Of sound
commercial banking, and ut the same
time will return to your homes and con-
tinue this doubtful policy"
Another interesting paper was read,
on Tho Bank Director" by Hon. \. B.
Scott The paper is reproduced below
in full:
There is no position to which a man
is called 10 perform q duty for others,
that is OF 30 Crea. responsibility Us tho
duty OF a bank director. How often
those of US, who ARE thoroughly
familiar with business in all its details
when asked about some particular bank
and its management simply refer 10 the
list OF directors and at once pronounce
it, either q good reliable institution or
otherwise, passing judgment simply be.
cause Of the well known character OF its
directors. Now, il as business men we
repose such confidence in q bank sim
ply on the faith that we have in its di-
rectory, how much more go must DO the
faith Of those who rely entirely upon
the honesty and good business judg-
ment Of those whom they have learned
to respect aud trust for the reputation
that they have built mp in their respec.
tive towns and cities. Thus takin. it
for granted that what l have said, is
true, that bank directors occupy m hon.
orable and trusted position in the COM
munity, by reason OF being selected by
representative business men in the
community.
Then what q responsibility rests on
each and every one who accepts such o
position. The widow with her mite,
the orphan with his all and the bust.
ness man with the receipts Of MS daily
sales takes it to the bank with blind
confidence in the homes. management
and good b~usineIs judgment OF tho
directors OF the bank OF their choice,
saying within himself or herself, Ny
money is entirely safe. because Mr..
is a director and l knew he will
care for my small savings as faithfully
as be looks after his own Now, docs
he do it? Does he feel this grca: re-
sponsibility? Now suppose you come
with me to a directors meeting OF Mr..
Blanks bank. DO you find him there?
Is ho with great care aud elaboration
c%onsiderInp The rrtiona nj thu r,gb;,r