The daily morning journal and courier., 1902-06-30
A BANK COMBINATION.

Something akin to Q bank trust is
 about to be organized, but there is, for
 tunately, no danger that it will gain a
 monopoly of the business. The present
 company, with capital of five million
 dollars, and a surplus of forty-flve mill
 lion dollars, is not to engage directly in
 the banking business, but is simply to
 buy a controlling interest in banks
 throughout the country and direct their
 affairs in combination. It is to own a
 national bank in New York, and the off,
 ficers of the corporation are to be the officers of the banks. In the chief financial centers of the country and in each of the state capitals controlling interest in one national bank will be purchased, and the affairs of all the in- stituttons will be directed from New York There can be no run upon the parent corporation, for it will not be l doing a banking business; but there l might be run upon one or more of the l banks in the combination, and the seve- l ral banks would be so intimately con- nected that disaster to one would prob ably bring ruin upon all There would
 also be great temptation to a concen-
 tration of capital in New York for
 speculative use, with it's attendant dan-
 gers The prospectus states, of course, | only the favorable view of the combna- | tion, such as facility in making ex- | changes and the transfer of funds from 1 one part of the country to another to
 meet the varying demands of the sea sons but it is extremely doubtful whether these advantages outweigh the l risks involved.
 The healthiest banks are local con-
 cerns whose stockholders and officers are known to each other, and whose business is promoted and closely
 watched by all. The officers of the new corporation recognize the necessity of having local stockholders interested in the branch banks, and for that reason do not propose to hold anything more than a bare majority of the stock in such banks, leaving the remainder to be taken by local business men, so as to interest them In the bank, Large as the proposed corporation appears to be, it is insignificant compared with the vast banking interests of the country, and there is little danger that it would grow into monopoly, or in any way gain control of the banking business; but it might do great deal of mischief to other financial institutions in an in- direct way Its failure, for example, | after it had established it's chain of banks throughout the country or the | breaking of link in the chain, would | probably create panic that would af- | feet disastrously all other financial in | stitutions. The tendency of the times | is towards combinations with great cap l ital, and there is, in one sense, no more | reason why such combination should | not own banks than there is why an- | other should not own sugar mills or an- other steel-works. But, in addition to the objections brought to bear against all great combinations of capital tend ing to the creation of monopoly, there is special objection to a combination deaing with money and exchanges The slightest accident to such a com bination, after it should be well estab- lished, might bring Temporary disas- ter to the entire nation.-Philadelp Ledger.