The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1896-02-05

Kansas has not SO bad a reputation in
the east as some people have been trying
to make us believe.
Kansas, as part of the "west," is re-
ferred to in the fifteenth annual report of
the New Hampshire board of bank com
missionera
The New Hampshire board CT bank
commissioners is composed of three mem
bers, and what they say about 'western
investments" ought to be, and will be, in
teresting to Kansas people.
Among other things the New Hamp-
shire commissioners say: "The condition
in the west for the past two years has
been one of defaults. depreciation of
values, and losses. 1t is the natural re-
suit of an unlimited field of investments.
The large interest rates received from
western investments a few years ago and
the almost phenomenal success attend
ing the early investments in that section
prompted nearly all the savings banks to
enter the field, and stimulated the incor-
poration of savings institutions in excess
Of the demands of the public.
''These interest rates enabled the
banks to pay larger dividends than were
paid by the banks of surrounding states
and invited deposits here from those
states. Il was prosperity which could
not last; yet any attempt to restrict the
investments of savings banks not only
met with no encouragement but pro-
Voked active and successful opposition.
''Some of the defaults and losses can
be attributed to the crop failures of the
west, but not all. The losses thus far
have come largely from classes of in
vestmeAts that would have proved dis
astrous whatever might have been the
condition in the west
tit has been customary to attribute the
troubles which have overtaken the saw
ings banks to their investments in west
ern mortgage loans, because of the large
holdings of the savings banks in this
class Of securities; but the principal
losses that have come to the banks are
not from western mortgage loans. They
are from the stock of western investment
companies, western state and national
banks, western corporation bonds and a
miscellaneous class of investments that
ought never TO have been purchased with
trust funds. These losses have been
largely met by the banks by charging
them out of their surplus earnings.
''That there will be losses from west
ern mortgage loans does not admit of
question Where the losses were made
on lots in boom towns or in arid sections
of the west, there must necessarily be
shrinkage But this class of loans is
small part of the whole.
"The greRt burden of the banks today
is the charge upon them in caring for
their western mortgages and protecting
their interests. Foreclosures are neces-
sary and taxes must be paid; but where
there is intrinsic value in the property,
the original loan and the subsequent
charges and defaults in interest VIII be
met when there is normal condition of
affairs in the west. 1t is now a question
of time and patience. 1t is conservative
to say that the western mortgage loans
will nearly pay out their book value to-
day, the profits on some loans offsetting
the losses on others.
an othing is to be gained by haste or
agitation. There is an improved market
in the west for the sale of real estate
over last year With good crops this
market will continue to improve, and
while the returns this fall from tho west
are not what were expected. there is
preceptible gain in the condition of
western mortgage loans"
1t is noticeable that in the opinion of
the New Hampshire bank commission
ers, western loan agents and managers
of trust and investment companies, have
done more to injure the credit of this
part of the country than other causes
which have been frequently assigned to
our troubles; and that it was not our po-
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