The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-06-18

~ apFinG and WiutHf whn1t 0mbs19o ~
Selv . 10Th heirs tha1 n Ne ysag'e aetusl
Gu4fvsps san NJ lsulssa was Nse uHnstufsl
thse shat nod hsppeBsd sees ~ pFbtcss
tim ~ M Leo NVpuWeHe fst1T HNts.
tfaesd NJ hasaesis that IN grSpa afs cHllet
ueaa ~ meet aad ladlcatsf ihat M tln's
saa mt ~ NJ onfesfealNed Optimism
maaNlire ~ veNets hHfvesta H"Vlew
Inc ~ fhsss considerations AMI 0'hefa
~ slmiisf Wet N whleh stl fsypir eiviNs
isily attention Nv hna6clai matters hsatd
fNuch lss, wess, v Ia Apeaent that hNos'
n them az n small aeNfuHt NNd that none
NJ thrm u essentially N eudasina na'uts
fhrrr " nuthfne IN them ghHt may MI riHnen
and ehHner duleNly f0f tIa hotter anil ~
tf~y stand they straal ~ tn day ~ day
st-ruiatrgs ftfhHf ttNh " ahv one ale"
They truf hui Httle ~ I'M primal ries''on ~
~ erntino prosperity N I'M Wua'fv ahddo
nut avail In m slightest drefeN w chang"
iha vail grounded r. sitlYn NJ 't1sr whr
maintain That the malu nueNmcht " ~
vaiirs In thr land IL etill definitely tpwafd
although nu oh'ciai ~annouhcc'nen' vas
fnalr ~ tho tact, n aeentesl Ia he gerefallv
nntptstncd n, The cioa~ NJ Tho w~ch that Tbs
prnhayivnhln Railroed ConranS nrertia
linns With l,nkera In raris tof q 80 ~! ""
nsn had treh successfully concluded III"
lene,h ~ time orhettmed IVY thrs- nrsutib.
tons Ina leen due, " ia lelievnd ~ N"
fac, tina, ,hosr In Francs with whom b~nl-
lnga concerning tho has werr had we're
an Sioua Ia NAL X" certain that They cruld
promptly scll 10 investors tho securities
tAkrn: and nl Indications were that the
assurance had ~ last tecnine definite. IN"
svent IL certainly ~ great imrortence to
oil financial interests On this side u means
the creation Of iist ~ much fneeh sterling
exchange In Our favor, anil relieves our
bankers of the necessity which Would
otherwise press severely upon them ~
rnisinR the PennsylvanIa's 90, uoD,OW In
this country
Attention has been often directed In this
column 10 the need Of 80 revising the laws
governing The national banks and the rela-
tons bet ween the national banks Of tho
country and the Treasury Department az
to bring these statutes In conformity with
the actual conditions and necessities that
have been developed in the last decade.
It will unquestionably be regarded as
cause for oongratulation In the banking
world that a bill at the close OF last week
passed the United States Senate, having
previously passed the House OF Repre-
sentatives, repeating the prohibition OF
the existing law that q bank shall not loan
more than 10 per cent. OF the amount OF
its capital stock to any one individual or
corporate borrower. Enacted man years
ago az a measure OF public security when
the capital OF the banks and the business
done by them we're small, the law In question
is manifestJy out Of place to-day. when
there are banks having surplus assets
immensely in excess of their capital and
that find it necessary to loan money daily
to individuals and corporations in a way
that according to the strict letter of the
law they cannot do. The Supreme Court
of the United States in its construction OF
the SPANISH war tai laws held that the
property Of a bank for purposes OF ia xation
was its surplus as well as its capital. The
Controllers Of the Currency have, how
ever, declined to admit that the property
of a bank for the purpose Of loaning money
was any more than the banks capital stock,
and this has forced the national banks,
unless they wished to close their doors, to
the use Of all sorts Of expedients for evading
the statute in the matter OF lending money.
The law as now amended allows a national
DaDk not only W odh ~ pA Oh' ~ 'NS
amount OF its capital stock to an individ-
ual borrower, but to loan 10 per cent. OF
its unimpaired surplus in addition, pro-
vded that the total OF such loans to any
one borrower shall not exceed 80 per cent.
of the banks capital stock. II to this
new law is now added another directing
the deposit Of all the public money in the
national banks and thus putting the secre-
tary Of the Treasury once and for all out
of business as an arbiter of money rates.
the present Congress, will have two indubi-
tably good pieces Of work to its credit.