The Montgomery advertiser., 1904-05-01

New York. April 30. 19o4.--The financial tables of the report of the Department of Commerce and Labor covering the first quarter of 1904 show 5,240 national banks in the United States on April 1. with total author ized capital of $7es.750.S15, which is something like $ts0,oeo,00o more than the aggregate capital of the 3,5s9 in stitutions in operation just five years before. These figures give some Idea of the tremendous development of American banking, and, too. may be factor in reassuring some people who, may have come to have some appre- hension as to the stability of American financial institutions In general
 Although the modern banking sys- tenn has approached what seems very like perfection, as compared with the primitive methods of 6 hundred years ago. 1t is still being constantly elab- orated. Within comparatively recent years the trust company-an American device, by the way. for enabling a large number Of individuals to place their money fin the hands of few ex- pert investors--has entered the bank ing held, and one of the most notable of the latest developments in banking circles Is the extension of this idea by the foundation of a trust company composed exclusively of national banks and banking houses. This is the bank CTS trust company, organized in New York about q year ago largely with a view to systematizfng the relations off the trust company to the banks. It in- cludes prominent bankers from every American financial center. and has al- ready become an important factor in facilitating this comparatively modern business of investing other peoples money.
 Such an institution as the bankers trust company, is therefore the latest development Of system of handling money that began, in its modern man. Hesitation, when the first medieval banker sat down behind his bench 'banco" in Italian from which many authorities have evolved the modern word bank--and began lending money to those who needed it. Naturally this first banker had money to lend; but hes was essentially a private citizen with a private fortune and taste for fin-l ance; and his barrel grew rapidly un- der the fertilizing influence of the large sums he was permitted to charge for the use of any part of it. His bank ing system was simply a continuation of what had been practised by the Ro- mans and even older nations, and when gold or silver or other treasure was deposited with him 1t was a special deposit, to be kept until called for, but not as is the case in modern banking. to be set immediately to work pro- ducing more wealth for its owner.
 The first real bank, however. which. like the bank of North America some six centuries afterward grew out of a pressing need for money on the part of a Republican government. was the bank of Venice founded in 1171 because the government needed ready money and took this way of forcing a loan from its opulent but reluctant citizens. Nowadays the government would have issued bonds, concerning which there would be much discussion in the news papers, would sell these bonds to ,vari- ous buyers who were only too glad to get a chance at them and would arrange to repay the entire sum thus borrowed as soon as possible. In Venice, however, the Republic agreed to pay 4 per cent. Interest but the loan was perpetual The amount borrowed from each citizen was entered in book and the "depositors," reluctant as they may have been in the beginning, soon found that the system of