The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1897-04-23
AND NOW THE BANKS.
They, Too, Respond to the Apparent
Universal Necessity for
Consolidation.

st. Louis, April 32.-In banking cir
cles it is generally conceded that the
day of the small banking institution is
passed.
The absorption by larger concerns of
such reputable banks as the Chemical
and National Bank of the Republic,
which belonged to the smaller set, has
given rise to speculation as to which
viii be the neXt?" The question does
not reflect any discredit upon the lesser
banks, but is simply a result of the ex-
isting conditions in the banking BUSH
ness of St. Louis.
4 do not know another large city in
the Union where the amount of what is
known as savings deposits are so
small said one of the leading banks
presidents of St. Louis yesterday.
Il mean,Of course, on deposit in banks
proper A bank is essentially different
from a trust business, and the small
savers of ST. Louis do not accumulate
their money in banks They have the
money saved just as they have in other
towns where factory hands, servants
and mechanics put their savings away.
Maybe the people here prefer to hoard
in their stockings or under the hearth
stone, but they do not put millions in
small quantities into the banks as they
do elsewhere.
II think that the safe deposit -compa-
MES, which pay interest on all these
small deposits, are gradually driving
the small and medium sized banks into
consolidation" said a we'll known bank
er, who asked that his name be with
held for obvious reasons.
Take the Chemical and Republic
banks for instance. They were both
substantial, well managed banks, but
they never made any money for their
stockholders. They had good sized lists
of customers, but not good enough. It
takes ConsideTa Bile over a million dol
lars of working capital to make any
profit for a bank nowadays, and no
hfaTE Al,asr-
ness may be, no bank cares about doing
business without an occasional divi-
dend- Even the larger banks, with two
or three millions, have in some cases
seen fit to amalgamate with banks of
similar size in order to achieve even
moderate results, and l think the bust
ness will become even more centralized
in the next few years. The trust COM
panieS are in measure responsible for
this.
They can do almost everything a
bank can, besides a half dozen other
branches of their business. which al
though vastly profitable are impossi-
BILE in the legitimate affairs of a regular
bank. They get the small depoSitOrs,
too, and these are gradually slipping
away from the banks. However, if bust
ness were to revive and a sudden de-
mand for money be generally felt here,
l think it would soon become apparent
that the banking capital of st. Louis
would be too limited, and small in COM
parison to that of other big cities.
Whether or not the safe deposit and
trust companies would be in a position
to meet such increased demand, I don't
know
1t is said that at least three other
small banks in st. Louis would not re-
fuse a favorable opportunity to consOl-
idate with large institution, and the
indications are that this may happen.
1t is a well known fact that the large
banks are making the money, and al
though there is not an insecure or weak
bank in ST. Louis, the smaller ones are
hardly making expenses.
The Bank of Commerce, the Boat
mans. the st. Louis National and the
Observation-Disclosures which are admit
ted to be the largest and most prosper
Gus of the city, have experienced a pro-
nounced Improvement within the past
two weeks, which is due, as a matter of
course, to the enormous amount of
their available capital The American
Exchange, Continental, Third and
Fourth National, State Bank, German
Savings and International Bank all re-
port an Improvement in business and
all of the lesser banks are in a prosper
Gus condition, but it is the four first
named which are making the big strides
forward.
Within six months the St. Louis Ma
tional bank has increased its deposits
so per cent and set a pace that will
prove wholesome to rival concerns.