Omaha daily bee., 1902-03-25
Total deposits in banks placed in hands
NEED Not Seek Foreign Reserve AEen.


Mr.. Royse continues: Nebraska is for
tunate In possessing within her OWE Dor
ders reserve cities and financial institu-
lions OF sufficient Importance, strength and
security to make 1t unnecessary for the
country banker to 90 outside Of the state
to seek reserve agents amply prepared 10
care for his business and protect his In
terests.
THE present banking act has proven
quite satisfactory and equal, II not super
Ior, to that Of any other state in the union,
yet, in my opinion, ZONE amendments or
additions might be suggested that would
prove beneficial In keeping with the con-
ditions and progress of the state and
worthy the confederation Of the next legfs-
lature, some Of which follow:
IT would recommend a fixed salary for
bank examiners, believing that It would
be more satisfactory both to the DEPART
ment and the examiners. As their reports
are the medium through which the depart
ment receives the most valuable and re-
liable information as to the banking in
stitutions under their supervision. It is es-
sential that the most careful and rigid ex-
animation be made. l would recommend
such salary to be paid as will not only al
ways command the services Of the expert
enced and capable persons, but enable them
to give all necessary time and attention to
their work.
II would recommend more frequent ex-
animation. It was a wise step in the ma
tional supervision when two examinations
were provided for each year. and in this
particular l would urge the consideration
by the next legislature of a similar re-
Quirement for banks under state supervi-
sion.
"The most dangerous and pernicious
practice Of bankers unworthy Of the name
or the privilege Of being at large, much
less conducting a banking institution, are
the most dificult of detection by the ex-
aminers of the department.
CIandestine Banking Methods.
Some OF those which are clandestinely
used are bills payable. rediscounts and GER
tincates Of deposit. l am sure such in
stances are rare in Nebraska, but as a rule
where such practices are found to exist
they have resulted In great injury TO de-
positors as we'll as to the legitimate bank
ing institutions. Every precaution should
be exercised In preventing as we'll as de-
tecting such evils. Adequate means or
methods to be employed are indeed dim
cult to determine. l have thought perhaps
that IL might De wise for the state to print
blank certificates OF deposit, numbered con-
secutively, and each bank charged with the
number issued to II and each be required
to account for every one issued, fixing a
severe penalty for use by banks Of blank
certificates other than those issued by the
state.
Il would that the law be SO
amended that in order TO be eligible to
the once OF director Of a state bank one
must become the owner OF capital stock
to the extent OF at least $500, that the
president shall be a director and that the
law hx the minimum number OF directors
to be elected and maintained by an incor.
porated bank. which number should not be
less than three.
Under section 2s OF the state bankins
act an oficer Of a state bank is not permit.
ted TO borrow money from his bank until
the board Of directors has authorized thu
loan. This Is a safeguard OF no NEAR
Importance. A large per cent OF failures
have been caused by ofhcers specializing
legitimately, or otherwise, with funds Dor
rowed directly or indirectly from the bank