New-York tribune., 1905-07-09
BANKING ON HONESTY.
Good Character Tangible asset I'm
Business.

I'm Scotland. when a man has arrived at years
of discretion and has a reputation for capabil-
ity, bank will. simply on his note, backed only
by his character, advance him sufficient money
USUALLY a moderate sunni to start in business
says S. A. Nelson In THE Worlds Work" This
is considered-and the conclusion is based on
sults-to be good risk In large cities, New
York and Chicago, for example. business is not
SO frequently conducted in that way. but there is
no doubt that great Western country owes
much of its wonderful growth to those far
sighted country bankers who realized that the
borrowers character the chief asset to be
considered. Naturally. character plays relative
ly larger part In the loanns operations of small
bank than in a large bank: in a country bank than
in a Wall Street bank, and in the beginning of
business mans career. Its relative Importance is
a matter Of environment
I'm 1895 New-York firm of merchants became
heavily involved in enterprises that sound,
but in which the realization of cash was slow. The
head of the house informed the representatives OF
irIn' through its difficulties or there would be a
Gt failure. when the banks would be heavy losers;
the burden In the ensuing investigation it ap-
loans. had omitted certain facts that indicated a
lack of frankness. We will say. Six years later
formed Industrial corporation or trust 1t ap-
2geared In the money market as large borrower.
should not be granted, until particular banker
When he recaled the EPISODE of % 1855 @ The nai
result was that the bankers informed the directors
credit desired when another president elected.
flaw in that mans character cost him the presi-
deney OF this particular corporation.
"A mining promoter; a man with a charming
several years ago in Wall Street. He failed to do
So Another man took up the work where he left
bitterly: Personally I am honest. Some years ago
with man who accumulated his money out of a
questionable trade L was said to be his adviser
now find that every one is reluctant to trust
l am "a nice fellow, but and then fall down.
ans to me the last lew few years ears 'esl "O' '' 40
One of the most successful Wall Street bank
come a partner in private banking firm. The OPP
thought it over and was faverably disposed toward
the proposition. He consulted friend. But said
get along with Gnentioning member of the firmo.
Why Why? @ He is tricky The banker rejected the
solved and the tricky partner retired but he had
baPRer wa G to Tecoq of
an industrial company that appeared to be; and
lawyer making the offer. viii be only nominal.
GUIDED that he could not afford to be ss associa3ed
with the other men of the board Surely the char
:r1 ~ bank and said 'Ay tank Ay want to borrow
amined, it was, ascertained that he had money
a good trader. The banker liked him so well that
loaned the Swede the money he needed. The bor-
rover made good. and became one of the most use
I'm a little Southern health resort town last win
ter / met young merchant who did business
Of $4,000 year on borrowed capital of 5000
How do you do it, and how do you get the credt?'
! turn my stock ten times year he replied.
But the banks here know me. and they know that
am a man Of my word, and they knew my father
before When say that viii be at the bank
tomorrow at II O'Clock with 81 900 they know that
| will be there at 10:55. | am part Of this town.
l was born here; my wife and children here
and expect to die here The man l bought this
business from honest he might be.
] worked for him. and at the time l protected
the two banks with which We did business
Il made few inquiries and the country banker
made this explanation: The man who owns the
business now worked for another man, who owed
us 2 go. The present owner knew that the money
was in another bank and promised that 1t
would sbe delivered here at a certain time. The
old owner drew the money and went off Il
spree. The present owner. rather than not make
good his word. borrowed the money his
note and paid us off When the business came on
the market we helped him get it. and we are glad
to do business with him. We only wish that we
could get more like him.
There ten thousand business in New
York who tomorrow might lose every penny they
possessed and yet the day following they
would start new careers. full of courage and
fdence, backed by the seemingly intangible but
very definite asSets-brans. health and. most i'm
portant, good character"