New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1906-03-18

| desire 70 have the percentage made as low as
/ possible.
20 have said. the stevens bill. although a
80 g., the right direction. Is not all we hoped
] for The trust company has become q national
! institution and should be controlled by national
! laws the same as national banks. instead or
! having. as I'm some states % per cent re-
! serve and in others. as in this state none
| AZ all The trust company Of to-day Is bank
ing institution with special privileges. 1t can
do everything q bank can do except issue circu-
! ation.
Personally have no feeling against trust
con,panies Many of their officials warm
personal friends Of mine, but officer of our
State Bankers Association it is my duty to
take the action I have. And ] am sure we will
win in the end
At Buffalo on December %, 1905, at the annual
meeting Of Group ] Of the New-York state
Bankers Association, Mr. Curtis made a speech
on this same subject which attracted attention
throughout the country and which did much
toward bringing the question before the Legs-
lature.
Il tell YOU. gentlemen. the present situation is,
to say the least uncomfortable, and is a matter
Of much concern to those who have studied the
subject In New-York City the trust companies
have over a billion OF dollars deposit, and
less than per cent cash in their vaults. Now
let the banks Of Clearing House fall per
cent below their customary 25 per cent reserve
and it is heralded all over the country in large
type, and a financial crash is prophesied.
When the national banking act and the laws
of some states were enacted many years ago the
trainers of these laws very wisely insisted upon
a cash reserve. This reserve was considered the
safety valve, and to-day you hear from all parts
Of the country that this national bank that
state bank IS being lquidated to become trust
company, and the safety valve is day by day
gradually becoming reduced in size. In the city
Of Springfield Mass, alone, five banks were
closed up and merged into the Union Trust
Company.
Il have spent my entire business life I'm Wall
Street and have witnessed every panic since
the memorable Black Friday. and I know too
well how easy IT is to retire at night in the
calm of a summer evening. and awaken in the
widest storm. Sometimes we receive a warning
and then again it may come like a bolt out Of
clear sky, similar TO the crash Of 1901
The last report Of the Superintendent of
Banking showed that one large trust company
in New-York City had nearly sixty millions Of
deposits and did not have one dollar of cash in
IFS vaults. It is true that this trust company,
like many others. had a good sized bank account,
but the banks cannot pay from . p to over per
cent on these accounts and keep this vast sum,
amounting to nearly hundred millions of
dollars, idle They must also invest it. and if
called upon tomorrow by the trust companies
10 pay they must meet the demand or suspend
payment.
The city Of New-York is a central reserve
city, and is carrying a large portion Of the re-
serves Of many out-of-town banks; IT, in addi-
ton to this they are compelled in times Of stress
10 also carry the reserves for the trust com
panies the load may prove too heavy. Skating
on thin fee has long been known az a dangerous
snort Rankins thin -eoer,-oo ruo., provo
equally dangerous"