Daily Kennebec journal., 1902-01-20

DAlL4 AEN EDl
sources above liabilities as shown b
the books is 81, ,635. .231.76.
| Mr.. Timberlake shows by table tina
| gradual changes nave been takin
place in the nature of investment
I made by savings banks during the pas
! t,ozen years. He says:
; The only material changes in tn
, classes of assets held are reduction o
| $a.530, $50 in the amount of government
bonds. and an increase of $3.619, ia 1
, III railroad bonds out OF Maine and 81,
! 02c, ,906.36 in municipal bonds out o
/ Maine
In addition to the re-investment o
| the usual maturities, the banks have
during the year, been Obliged to inves
! this increase in assets. S3,546. .95935, ant
also re- invest the proceeds of the sale.
of government bonds. par value. 81, $50, !,
$50. amounting in all to Sc, OF, ,509. .35. A!
before suggested, the increase of S..
60, 520.5, in the holdings of railroad
bonds and municipal bonds out OF
Maine. accounts for the larger part OF
this fund.
When the banks, during the wear
have sold their holdings Of governmen;
bonds the proceeds have been re-invest.
ed largely in high-grade municipal
bonds out Of Maine. This explains the
unusual. and at the same time very
satisfactory increase in this line of Sc
curities
In speaking of street railway bonds
the examiner says:
In 1895 the law regulating invest
ments of savings banks in railroad
bonds was amended by adding the fol-
lowing provision: No bonds of street
railroads. excepting those already con-
structed in this State, shall be pur-
chased, unless an amount of capital
stock equal to SO 1-3 per cent. OF mort
Sege debt shall have been paid in, in
cash. and expended upon the road, evil
denced by Il certificate of the railroad
commissioners. filed in the office of the
secretary of State. that said percentage
had been SO paid in and expended. in
addition to the amount of the bonded
debt" Following the opinion of the
attorney general. this provision has
been construed TO mean the railroad
commissioners of the State where the
railroad is located, filed in the office of
our secretary of State.
1T was undoubtedly the intention of
the Legislature to give depositors in
savings banks the additional protection
afforded, by thus restricting the in
vestments of their funds in this class
OF securities. to those issued by rail-
roads which could show that they had
complied with these conditions. 1t is
also evident that the Legislature did
not intend to accept the statements OF
the railroad companies themselves as
evidence of these facts, as it provided
that the railroad commissioners, who
are presumed to have peculiar knowl-
edge of such affairs, should personally
certify thereto. Undoubtedly it was al
so expected that the commissioners
before executing these certificates.
would make personal Investigations,
unless they already, had knowledge of
the facts Of which they were to certify.
1T has been suggested that our Legis-
lature had no power Ito delegate such
authority to, or to authorize. the offic-
ials of any other state to act in such
capacity. 1t is undoubtedly true that
this provision of the statute of oun
State does not compel any such duty
from persons residing without it's
limits. II does, however. authorize
them to act if they choose to do so, and
the Legislature certainly has full power
to prohibit our banks from investing in
such securities unless this condition is
first met. by the fling of certificates in
due form.
All sections of the country, as a rule,
are anxious to meet requirements that
will invite capital thereto. For this
reason. If for no other, the parties
named in our statute would be likely
to assume the responsibility to issue the
certificates required whenever the facts
will warrant. AS the service required
of these officials by our statute is en-
tirely outside of the duties required by
the authority under which they are ap-
pointed. it is also one for which they
would be entitled to receive additional
The authority under
which they act in this particular comes
from the provision of our statute and,
therefore. meets it's requirements even
thugh outside of the usual duties Of
these officials. AS our Legislature
named those officials to act in the
premises. it seems to follow that. even
though under the statutes Of their own
states they had no supervision of street
railroads, they would still have the
right to act in this matter. The en-
forcement of this restriction Of invest.
ments has given more trouble than all
others, since its enactment"
The rate of dividends paid has aver.
aged $40 as against 1886 paid in 1900.
Five banks paid 4; 20 paid 3ls ) paid
az: and % paid 8 per cent. The report
says:
Trustees should not attempt to place
their funds so as TO maintain present
rates of dividends at the expense of the
future strength Of the institutions
Present conditions do not warrant the
payment OF more than per cent. divi-
dends by the most Of the banks. after
deducting the present rate Of taxes to
the State. and other necessary charges
and expenses. Ifthe banks will reduce
their dividends to this rate. and by
making only the very best investments.
THUS place their future stability beyond
question. their deposits will increase
n nd tha;r sra,,arol ucaf,lparo continue /"