, 1897-10-19
TUESDAY, OCTOBER 10. 1897.
KANSAS

The story of the great prosperity
which has come to bless the people OF
Kansas reads like a fairy tale. John
Breidenthal. vino, by the way, is large
ly Interested in our Standard Plaster
company, is bank commissioner for the
Sunflower state, and ne was recently in
terviewed on the conditions which nov
prevail there.
Novel questions are brought tc him.
Stranger conditions than ever before
confronted official supervision OF finan-
cial institutions are presented. The nat
ural order OF the banking business Is
the state an private banks u keep
on hand a reserve of ut least 20 per
cent. This is to make them secure
against emergencies. 1t also says that
they mus not invest more than four
timee the capital stock. This is to pre-
vent too much business for the amount
of capital. Now the commissioner Is
asked by the banks what they shall do
! II AAoICs mat 10
beyond all precedents in their safes.
They want to know il they shall refuse
deposits or charge depositors for the
care OF the cash which has come into
Kansas SO suddenly and in such guam
tfsies that 1t is a drug. Mr.. B%reidenthal
Is writing to these inquiring bankers
that where the deposioor is a regular
customer his money ought to be ac-
copied in the usual course. But where
q man comes in with a wad OF money
received for his crop or his cattle and
is making use Of the bank a. a temper
airy pace OF safely it will be proper to
charge him something for the
dation OF taking care OF his deposits.
Was there ever before such a situation
in the banking business?
"A Kansas City bank made its sworn
report to the comptroller OF the cur
rency last week. 1t had on deposit $15,-
49, 6 Ten years ago if a New York
bank had made such a showing it would
have been talked about the country over.
But the total amount Of deposits was
not the only surprising thing in this
Kansas City banks statement. There
was on hand in cash and sight change
the sun Of 6 1881. 1877. One thing more
is to be added. OF the nearly 81, 900. 900
in cash, over So, 900. 900 was money sent
in from the banks OF Kansas, n~ominally
to swell their reserves: actually, for SAT-
er keeping than the ordinary precau-
tons available in town and county in
situations.
Mr.. Breidenthal calls on the state and
private banks every three months for
reports, just as the government requires
statements to the comptroller from all
national banks. A week ago the Kan
sas commissioner issued one Of his calls.
The reports are coming in. He had a
batch Of them or his desk as he talked
of the changed conditions in Kansas.
The first was from a hank organized in
a little town the 21st OF September. 1t
showed $29, 900 cash on hand. The next
report gave $35. 900 deposits and $22, 900
cash for a bank with $4,000 capital.
This said Mr.. ~Breidenshal, as he
unfolded the third return, sis from a
bank in a town OF about 500 people.
You must remember that the most OF
the state and private Institutions, which
come under the supervision OF this Of
fee, are in the smaller towns and coun-
try communities where banking facili-
ties are needed, but where national
banks can not be established. The bank
OF which this is a report has a capital
stock OF $500. 1t has s55 5000 in depos-
its and $41, 900 in cash and sight drafts"
The fourth report in the mornings
mail was from a bank with $50, 900 cap
ital. The bank reported $117. 500 in de-
posits and $4,000 cash on hand"
This" commented the commissioner,
as he unfolded the next paper, sis from
q little hank away out in the short
grass country OF western Kansas. 1t
shows S43, 900 in deposits and $4,000
cash."
Thus the reports which are coming
under this latest call run. The law re-
quires the banks to keep 20 per cent
in cash. The reports show that the
state and private banks OF Kansas have
from so to Is per cent in cash on hand.
Such a condition is through no Intention
or wish OF the bankers. The money is
piling up faster than legitimate uses can
be found for it.
The call preceding the one which went
out last week was made in July. 1t
showed deposits in all Of these state and
private banks amounting to 81. 500. 900.
which was $4,000. 900 more than che
March reports gave. For the hrst time
in the history OF the Kansas barking
supervision deposits this year exceeded
loans, showing that the i~ndebtednsas y
going down. Enough reports have besn