New-York tribune., 1899-03-27
TO FIGHT THE BANK RULING
OPPOSITION To THE OUT OF TOWN
CHECK CHARGE GROWING
MITE LINZ or ACTON TALKS WITH
SOML or THEM

F MEE'HANTS GRADUALLY DEVELOPING DEF1-
MITE LINZ or AcrcN-TALKs WITH
soME or THEM
The oppoHtion crgendered by the recen. ruling
Of the Clearing House Association. by which a
charge ranging from ore-ten,h to one fourth Of
+ per cent ii minimur1 is 70 he made for col
lecting checks drawn on out-of-town banks. IL
gradually developing. among merchants and
others having extensive dealings outside the city
definite line Of action to force tn, associated
banks to rescnd or materially modify their
ruling. The call for expressions Of opinion and
for suggestions 70 ways and means TO fight
the banks on this issue by both the Merchants
Association and the Board Of Trade and Trans
portation. has brought forth any number Of
ready responses
That class Of merchants among the large re-
tail drygoods dealers particularly affected by the
now rule. by reason Of their extensive trade
with the immense suburban population around
NewYork. would generally be classed by their
banks desirable" customers When seen by
a Tribune reporter number Of these merchants
gave A suggestion OF their probable line OF ac
tion. provided the banks did not either remove
the Objectionable tax altogether or else so mod
ify the ruling that it would not affect them.
the large daily. weekly and monthly balances
which We are carrying with our banks These
balances we have kept with them for the very
purpose OF covering the cost OF collecting the
checks Of our out-of-town customers. Our bal
ances the banks are putting out as call loans.
and getting interest on them. while
getting nothing from them. Now. II the banks
propose to squeeze us will protect ourselves
by Withdrawing such funds and placing them at
interest"
one Of the leading merchants said that he had
made a rough estimate. and had found that by
Withdrawing the large balance which he keeps
at his bank 10 cover his out-Of-town collections
and putting that sum where It would bring in &
per cent interest. as he readily could he would
save money. Another expressed it his belief
that when the banks had the facts presented to
them as outlined herewith they would not fail
10 modify. and perhaps reverse, their action.
Others among the banks desirable custom
ers. who do not occupy the position OF vantage
held by the class Of merchants just described,
are nevertheless not left without means OF re-
dress For while the offers Of banks in Phila-
delphia. Boston and Jersey City 10 take ac-
counts Of houses here and collect out-Of-tOwn
checks without charge DO not seem 10 meet
much favor. on account Of the expense for extra
clerk hire the loss Of time involved and the i'm
measurably inferior facilities possessed by such
banks To DO the WORK, the idea OF transferring
their accounts TO trust companies is looked upon
favoraby BY this means the tax ruling would
be in effect nullihed. since the trust companies
would give a rate Of interest just sufficient TO
pay the tax.
But. on the other hand. there those bank
customers classified as undesirable" These
are customers who soon they have depOs-
tied bunch of checks Immediately. or az least
before collection is made. draw against their de-
posit 10 tho full From the accounts OF such
customers. the banks Of course. make nothing.
And IT is probably 10 force just such to pay for
the services rendered them said a merchant
yesterday that the Associated Banks took the
action which they did But the question re-
mains VIII the amount in this way gained make
up for the loss involved by the withdrawal of
large balances. and. in some cases. OF entire
counts by desirable customers? VIII that tend
- strengthen the banks Would II not rather
be wiser for the banks to require all depositOrs
to keep a balance sufficient to cover checks sent
away for collection? The extent 10 which oven
the strongest and best banks permit customers.
after making large deposits i'm the shape Of
checks on other banks. especially Out-of-town
banks whore collection takes from one to two
weeks Immediately to draw them s ncred-
ibiy large and 20 the lay mind inconceivable to
sane nnanCl"rng
But since the rule has been made. and must
he tried for three months before action he
taken 10 rescind IL. according 10 William Sherer.
manager Of the Clearing House II remains 10
hc found out from practical experience. who is
right. the banks or their customers"