New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-12-09
BANKS SHOW PROSPERITY
CONTROLLERS REPORT.
Z. s. Should Take More Important
Place an International Banking.

Washington, Dec. S-The forty-second annual re-
port of the Controller of the Currency has been
prepared for transmission to Congress. The fig
ures in the report Controller Ridgely says. show
the most marvellous growth in the wealth and
mercial Importance Of the United States" He
continues:
Almost every year all previous records are broken
imports. TIE people of the United States have be-
come the richest in the world. and the natural re-
sources or the country great that this is
to continue and increase for many years to come.
money hand in the banks Increases in every
portion OF the United States at a most remarkable
rate.
In spite of all this. however we do not seem to
DE tdhIng our proper rank and position IN foreisn
ana international banking, one of the chief diff
culties encountered by all merchants and manu-
countries. and especially those of South America
and the Orient. is The lack Of American banking
very largely through European houses. This ranks
next in Importance to the question of an American
great influence on the volume and character of our
AS long the United States were experimenting
with silver bimetallic standard that fact acted
gold standard is firmly and rrevocably established
we should be able to take our proper place In IN,
become more and more the depository for interna-
uonal balances. and exchange on New-York be ac-
accepted more and more in all commercial countries
of the world. One important reason why our peo
pie have not been more aggressive and taken a
larger part in international banking business has
been the same as in many other lines Of trade
tnat Is. that we have been too much occupied with
our own domestic business. and there has been a
a
nome which was easy 10 DO and promised as
great or even greater profits.
condition is greatly changed. and there is now IN
the United States abundant capital and talent for
this business if 1t is given proper encouragement
Many of the national banks engaged in
handling foreign exchange: some of them have
large and successful foreign departments In
measure as the demand arises, facilities are being
supplied and the Controller sees no objection. but
on the contrary. many advantages, in having the
ased TO cultivate TINS business by granting them
additional powers and authority for doing
ganization OF national corporations should be au-
thorzed for the purpose OF conducting the business
and II would 5pnear 10 be wiser 5nlicv 10 mine
the well organized and strong national banks which
are already largely engaged in this business. The
and entirely just TO the banks to restrict these pow
ers to banks Of large capital located in the reserve
cities. Many OF them now have well organized for
elgn departments and officials familiar with this
business. and the Controller believes that they are
the best agencies now at hand to extend and in
crease this very important business.
pursuance of this policy that national banks hav-
Ing capital OF 100000 or more, and located in the
reserve cities central reserve cities be specially
authorized 10 buy and sell foreign exchange to &C
exceed months after sight. and Issue letters
OF credit and also 10 open and maintain such Of
noes agencies or branches as may be necessary to
Rico, the Philippine Islands. the Hawaiian Islands
and the Panama Canal zone.
It is believed that this will tend to make
closer the relations OF the United States with each
or IT'S possessions; ana would be obviously to the
advantage or both. The increased sphere of our
as they relate to the great questions OF banking
and exchange. call for additional legislation; and
the recommendations contained in the foregoing
Intended 20 meet the necessities of manifest
obligations and duties in this respect.
The Controller respectfully recommends that an
act be passed repeating the Limitation the spro-
portion OF the circulation OF any bank which may
be issued In notes OF the denomination OF s.. The
restriction In the act OF March A. 1900. by which
notes OF the denomination of s. limited to one
third Of the amount issuable by any association.
to limit the total issues of notes of that de-
nomination one-third OF the aggregate amount
issued AS a matter OF fact. this proportion has
not been exceeded since 1874. For the year prior
to the passage of the act, national bank notes OF
this denomination amounted to but 81 per cent of
the total, and this percentage declined TO 21 per
cent in 1909 and to l6i per cent in 1902 at the
date OF the last report of condition amounted to
1876 per cent. The scarcity OF notes OF this
nomination and the great convenience IL Is
banks in the smaller communities to be able to
issue notes OF 50 10 the amount of their whole cir
Culatlon formerly, leads the Controller to
strongly recommend that this restriction be re-
pealed.
The Controller would again renew the recommen-
dalton contained IN his report of December l,
1902 for the repeal of Section of the act of July
9, 1882 which limits the amount OF lawful money
which may be deposited with the Treasurer of the
United States by national banks reducing their
circulation TO So 900 during any calendar month
The reasons which lead to the enactment of this
restriction have ceased to exist and there does not
appear to be any good reason why II should be
continued an force Its repeal would add ma
terially the elasticity OF the national bank cir
taRes
The Controller would again call the attention OF
Congress to the necessity for legislation In regard
the liquidation and consolidation of national
istence.