Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1905-05-01
State Bankers Association Part
ly Responsible For Bad Condi-
ton of Banking Business
GAVE MEASURES POOR SUPPORT
Il ls Claimed That This Year the
Bankers Will Press the Matter Of
Requiring All Banks to Incorporate
or Report to the State Auditor of
Iowa.
Special to Times-Republican.

Special to Times Republican.
Des Moines, May l. - Exaggerated
statements in Everybody's Magazine
as to the condition of the banking
business in this state have caused a
revival Of the discussion of the ques-
ton Of enacting a law requiring all
banks to incorporate or report to the
state auditor. While the statements IN
Everybody's are exaggerated it is rec
ognized by the state officials that the
conditions are bad so far as the priv
ate banks are concerned and that the
proposed legislation is desirable. At
the same time the responsibility IS
being placed to some extent on the
State Bankers Association. 1t is claim
ed that there would have been law
before this If the bankers association
had taken the matter up In real ear
nest and pushed the matter at the
sessions OF the general assembly. II
has been proposed any number OF
times to pass more stringent banking
laws and bills have even been suggest
ed but have never been enacted INTO
law because, it is alleged. the bankers
themselves have given but half-heart-
ed support to the measures. There IS
a claim made now that the bankers
this year at the state convention Will
take the matter up in more serious
manner and will press the matter and
even lobby at the next session of the
legislature.
The article in Everybody's Magazine
seeks to lay the blame for all the bank
failures in the state to the beef trust
i ssl 40 1T It's - oreratfcn-. State etfYicialss
claim that while the beef trust may be
responsible for many things it is no
more responsible for the bank failures
than are the ten commandments. There
are about go state banks and some-
thing like 800 national banks in the
state, making a total Of nearly 1000
incorporated banks. There are about
$50 private banks in the state. In the.
last twenty-eight months there have
been failures of seven state and
savings banks and three fall
sures of national banks. A total
Of ten. In the same time
there have been about forty private
banks which have failed. There were
thirty-six during the two years of 1908
and 1904. 1t is thus seen that one pri-
waite bank out of about every fourteen
failed in little over two years, while
of the incorporated banks one failed
out Of every ninety seven. Another
way of looking at it is that while there
are only little more than half as
many private banks as there are In
corporated banks there were four times
az many failures of the private banks
It has been discovered too that there
is a difference in the nature of the
failures of the private banks as COM
pared to that Of the state and savings
banks. OF the six state and savings
banks that failed during 1903 and 1904
three were defalcations, one was due
to private investments that didn't ma
terialize and two were too heavy loans
to individuals or companies in which
officers of the banks were interested.
The failures Of the state banks were
therefore due to dishonesty OF which
there is always sure to be more or less
in the world. Defalcations are, of
course contrary to law and the law
also prohibits officers using the funds
OF the bank for private investments
and limits the size Of the loans to any
one Individual or firm. In each OF the
state failures therefore the law was
broken. AS to the private banks it
was not so much in many cases
streak Of dishonesty as it was the lack
OF proper supervision Of the bank by
some official. The owner of a private
bank has a greater degree of liberty
in handling the money of the bank
which is his private property so far as
his own investment is concerned. Any
number of the failures of private banks
have been due to indiscreet invest
mer1ts that IL the bank had been under
the inspection Of the state auditor as
the state banks are, would not have
been allowed.
The first paint on the corridors OF the
state house was put on Saturday.
Heretofore the workmen have been put
ting the wall In shape for the paint,
cleaning off the dirt and filling UP the
cracks in the plaster1ng.
Members Of the Grant Club of this
city are incensed that such an unwar-
ranted attack should have been made
in one Of the evening papers Of this
city against Hon. Williamson S. Sum
mers, of Omaha. who was the guest
of the club at the banquet Thursday
night. The attack will likely result In
resolutions being passed by the club
according to the declarations of some
of the members. 1t is pointed out that
the Omaha gentleman was the guest
OF the club on the occasion and no
matter how poor a speech he might
make it should not be ridiculed. es-
pecially by member of the Daily
Capital, whose editor is member OF
the club Saturday number express
ed the idea that q newspaper is all
ways at liberty to take issue with the
ideas expressed by . pubic speaker.