The evening times. [volume] (Washington, D.C.) 1895-1902, 1902-05-14
Financial Topics Discussed
Before the Bodies.
THE EVOLUTION OF BANKING
Thomas B. Patton, of New York, Consid-
ers the Subject-The Branch Banking
STANDARDIZATION Reviewed bz Horace
White and q. W. Yates.

/
associations Of Missouri, Kansas. and
Oklahoma and Indian Territory. Three
| separate gatherings were in session this
morning, the Kansas bankers meeting in
| Kansas City, Kan, and the Indian Terri
| tory and the Missouri bankers converting
| on the Missouri side, Aside from annual
| reports presented, E A. Kelly, of Leaven-
worth, Kan, made report on the con-
| ference in New York on bank money
orders, before the Kansans Gordon
Jones. of St Joseph. president Of the
/ Missouri Association, delivered his annual
address to that meeting. and Thomas B.
Patton. Of New York. editor of the Bank
ing Law Journal delivered an address On
The Evolution of Banking Law
Mr. Patton spoke OF the laws which gov
ern the business dealings of ban,1s-not so
much the laws which govern the organi-
cations and powers OF banking corpora
tons as those laws which govern the in
| struments of trade in which bankers deal.
the bills, notes. checks, and other instru-
r1ents representing money and the docu-
! mentary securities representing property
values, which constitute the bone .ad
sinew Of the mercantile wealth of he
country. and IN which it is the peculiar
| Office of the bank 20 deal and to make eF-
feetiye.
He showed that the formation law gov
/ ernlng bills, notes, checks, and the deal
lngs OF bankers is the result OF a peculiar
process II consists of a body of rules
which have been built up piecemeaI by
/ judicial decisions founded on custom. II
has been developed out OF the disputeg of
men. The process originated in England
| and has continued IN the various States
since the American Revolution. At coca
sionai periods in this process OF judicial
rule building there have been statutory
enactments providing rules on this OF that
particular point of OF commercial Law.
Evolution of Banking Systems.
Mr.. Patton traced in detail the evolution
Of this process from its starting point in
England in the customs Of merchants es-
tablished 600 years ago. and showed how,
when this country came to be established
into a nation Of Independent States, the
process was continued independently in
| each of the States and Territories of the
Union The result has beef. the establish
ment OF many independent systems of
State laws. statutory ara judicial, gov
erning banking and the instruments Of
commerce. whereas the subject governed
is not confined to State lines, but is ma
| tienal in scope. The speaker pointed out
many instances OF conflict OF state laws.
and showed, as the result Ct the present
condition OF the law made I'D so largely
| OF Independent and antagonistic State
rules, that great losses are caused to the
mercantile and BANKING community, and
that commercial transactions between the
States are hampered-
In the afternoon all the associations
met in joint session on the Missouri side.
The topic considered vas Branch Bank
ing, and Horace White editor Of the
New York Evening Post" and Henry ".
Yates. of Omaha, president of the Ne
braska National Bank, made addresses.
Address by Horace White.
Mr. White said in part: Many plans
/ for securing the needed change in our
| system have been proposed The best OF
| these is the one presented by the Indian
apoiis Monetary Commission.
The advantages Of branch banking are
| briefly these:
| First. Other things being equal, two
banks Joined together are stronger than
enc. and three are stronger than two.
! bad banking and internal rot, but it is
| protection against accidents and external
| calamities- 1t is another illustration of
the familiar proverb, In union there is
strength"
| Second. Fer this reason the public has
/ greater confidence in a union of banks
| than in the same number OF banks taken
separately Branch banking would. there
fore. improve the credit Of the banks 50
allied and increase their deposits. This
/ advantage would accrue more particu-
/ larly to the branch bank OF the small
| country bank taken into the system than
10 the parent bank in the city.
Third. Branch banking would reduce
| the total expense Of banks, and this say
ing would, in the long Fun, be shared with
| the banks customers in the form Of lower
rates Of interest.
Fourth. Branch banking would tend
here, as in other countries, 10 uniform
| rates OF interest between the cities and
| the rural districts
| Fifth. Branch banking has the advaa-
| tage that IL can be extended to places too
| small to support regular bank, which
| requires a full complement Of officers and
| a reserve Of coin and greenbacks. Offices.
| or agencies. can be established at places
/ which are now wholly destitute of bank
| facilities, but where some deposits could
! be obtained and some safe and profitable
/ business done, IL the public were assured
| that the parent bank was strong insti-
| tuition.
/ Sixth. Branch banking affords facilities
| for communicating knowledge of the rela-
| tive needs Of business in different places
| and for responding to them. knowledge
| of the demand and supply CT money would
| be quickly conveyed from the branch at
/ the small town to the parent bank in the
| city. and funds could be quickly trans
| feFred 10 the branch either from the
| parent bank or from any other branch
| where the demand was less pressing, and
| vice versa. Another reason is that branch
| banking is bound to come, and that you
| cannot stop it.
Opposition to Branch Banks
Henry ". Yates. of Omaha, spoke In
| opposition to branch banks, saying in
| part: We are ali conscious of the weak
| nesses which prevail in our banking sys-
| TEN, and we are DESTROYS of having them
removed and the system strengthened and
| improved in any manner that good jUdg-
/ ment and wise experience win dictate
/ But 1t does not follow from this that We
/ should conclude that cur banking system
| is so utterly bad that the only remedy for
| the situation is its entire extinguishnent
| and the creation IN ats place Of another
/ system This Is what I believe would
| result from the passage of law which
/ would establish among Us the monarchical
| British and continental systems of large
| aap4-aI hanks ,--{fE, xsgzyr4srags branches