The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1898-06-29
PRESIDENT FORGAN.
Chicago Ffnancier Discusses His
Profession With Interest.

rO1tUANs
Chicago Ffnancier Discusses His
Profession With Interest.
Mr.. President, Ladies and Gentlemen: 1t
Is pleasure for me to return to this great
state, where / spent some happy years, and
| to meet on this occasion so many well-re-
membered friends. l thank your executive
council for this opportunity SO courteously
offered me, and l also indebted to them
for saving me some perplexity by suggesting
the line which they wished me to follow In
this address.
Some people think bank is the place to
put boy who is no use for anything else.
And it must be admitted that very moderate
capacity. accompanied by good character, Is
sufficient to insure his job to many man
who spends his whole life in a bank. he
learns to enter the checks in one column Of
a ledger, the deposits in another, and 10 strike
a balance. and he may jog along on that very
comfortably. remaining as innocent of all
knowledge concerning the business of bsnk-
ing as the woman who scrubs the bank floor.
But while this is possible, it is by no means
common. The bookkeepers In banks are gen.
orally men of more than average intelligence
and it is the greatest drawback to banking
who enter its ranks are OF necessity con-
demned to lifelong drudgery as bank en-
ployes and never become bankers. Unfortu-
nate.y this seems to be particularly charac-
teristic of banking in the United States
There are several reasons for it. Our sys-
tenn does not lend itself to the gradual evolu-
ton OF banker so well as the branch sys-
TEN. In Canada. for example young man
soon gets to be teller at small agency. If
he is capable he will begin to show it in the
telling box, not SO much by the rapidity and
knowledge Of his customers responsibility
which he will soon acquire and display.
From teller to the accountantship Of branch
is an easy step in advance. In this post on
he is in charge of the Office work. he has joint
| custody with the manager of all the cash and
securities, he is authorized to sign for the
bank, all minor questions that arise are re-
ferred to him for decision. and thus he be-
gins to assume some responsibility. He ceases
to be an irresponsible piece of the banks
machinery, and becomes part of the guiding
force of the machine. While not RESPONSE
Bile for the loans, he is free to consult with
the manager about them and to express his
opinion ON them, especially on those he es
not himself approve OF. If he shows good
Judgment, independence of thought and self
reliance he is marked for an agency. When
that comes. his evolution from the bank clerk
| to banker may be considered compete. He is
now in charge of a banking business; he
makes or refuses loans; he loses money, per-
haps. and gains experience; and, according
as he proves himself capable, the business
under his care Increases or is driven away,
1t Is not uncommon in Canada for a man to
attain this position as young as say rs. But
even then the first is usually a small agency
where the amounts loaned light, and the
| important positions come later when he has
shown capacity in the lesser ones. All
through these steps of promotion Won will no.
| tice his employer has been the same. and the
ability displayed in minor positions has been
noted and rewarded by an employer having
many higher positions in his gift Unfor-
tunately our system puts usually only one
and at most very few responsible we'll
paid positions in the gift of an employer
consequently promotion is very much slower,
for the ability displayed in minor positions
Is known only within the institution. The gulf
between bank clerk and banker is therefore
with us. much wider and harder to bridge
than 1T is where the branch system of bank
| ing prevails.
| Another thing which mitigates against the
attractiveness OF banking to ambitious young
men IN this country, Is the want Of its gem
eral Acknowledgement as a profession. We
lead the world In railroading, in mechanical
pursuits In agricultural industry, in general
business ability, but in financial skill we lag
behind In the race for national supremacy
Ihls IS equally apparent In our unscientife
currency. system, which casts the blighting
| breath or suspected instability over our en-
| tire financial fabric, and in the undeveloped
condition of the banking profession. So far as
my observation goes, high-class banking is
practiced among us only in spots. It is far
from being general. One of the Fundamental
principles OF good banking is that the bank
should ePs I'd not no 6sh the capital for It's
should possess his own capital ard requ re
assistance from the bank only at certain sea-
sons and for specific purposes. There
ought to be time in each year when the
customer owes the bank nothing Indeed
| ideal banking does not include Single name
paper at all, but is confined to the discount
l
ing an actual purchase Of goods by the maker
from the indorser. and to loans upon convert
s ape collateral security. We have gone SO
more ideal than practical, but l am at least
sure that the best criterion of a banks loans
is the proportion of them that can be collected
at maturity, II desired or required One has
only to apply such principles 10 the ordinary
panklng practiced among us to recognize how
lar Ia MEAL we ran short: The number of special
toners is legion. Or. to go into details for a
moment, l do not think a bank can he
tn1ottoughiy well managed, at least in cities,
without something in the nature of credit
| bureau being established. Data covering the
average balances of customers accounts full
details OF their assets and liabilities, COM
| merc1ai agency and other reports, the growth
| or decrease in their business ETC., should ali
! be available at moments notice. MANY of
our our largest n banks have no system of tabulat-
assertion that there is not one OF them which
could not have avoided losses, both past and
| so insignificant in banking that they may be
| considered unimportant. There are at pres
ent three law suits, involving large amounts.
6eg the Chicago courts, belonging to three
on the date on which certain colla.erals wee
taken. For the credit of the profession in
Chicago, l am sorry to have to admit that
not one of the three banks can prove This all
important point by its records. There are
! several reasons for all this, but the chief one
is the total lack of uniformity in the train
| ing of men for the business 1t is only with n
the past few years that boards of direc .nr :,
and the general public have begun to think
Gently bank cashiers and presidents were iust
as likely to be selected from any other line
OF business as from the ranks of bank men.
1t is still quite common to think man can
! run even large bank as kind of side
show to his other more important business
affairs This idea is the costliest one that
ever entered into Shareholder heads but in
spite of the long Est of failures caused by
mixing up of the banks affairs with the
Presidents: the idea dies slowly. 1t is still
the exception rather than the rule to find q
bank president wEo could fill any ether posi-
tlon In the bank as well as the man in il.
Many OF them are absolutely ignorant of
i bookkeeping, have no knowledge of accounts
ana even domestic exchange transactions. TO
say nothing of foreign, are a kind of contin.
t mental puzzle, which today they think
they grasp, and tomorrow cannot recall
l am referring now to bank presidents who
are the active managers of their respective
banks. and whose salaries as such are by far
the largest In the bank. There is however
common arrangement by which the presi
dent holds his position by virtue of lis stand
ing IN the community, or his large ownership
| IN the bank, takes only a nominal salary.
gives his counsel and advice, but does moi
pretend to be banker nor the active man
age en OF the business ua This arrangement is
1T exists there must still be an active man
ager in the person of vice president or
cashier, and he, at least, ought to be a thor
oughly trained banker. The predominance of
men filing such positions who are NOT 60
trained is in my opinion a great drawback IN
our profession. 1t tends to keep our most
| capable young men from entering it's ranks
and for the most part only those are attract i
who have no thoughts of a career, but are
well pleased to go TO work in a bank" In
| countries where the profession as such is
more fully recognized young men enter q
bank as career, looking forward to the time
when they shall sit in the managers chair
This IS a fine thing for the profess on. even
although, as We know. the majority can
never reach their goal.
But, it may be asked, will training make q
4 banker? No. 1t will not. If man has moi