The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1906-10-26
CAN'T
Kansas Is Short on Bank
Examiners.
Three Men Must Look After
700 Institutions.
HAIL nEKAAnar III AZ
WOULD CHANGE PLAN.
Mr. Royce Thinks Each Should
Be Examined Annually.
Present Force Is Inadequate for
the Task.

There are zoo state banks in Kan
sas, and 1873 National banks, and the
state has three bank examiners while
the national government has two as
signed to Kansas.
In other words. each state bank ex-
aminer must be responsible for 23S
banks. while each national examiner is
required to account for only "a bnaks.
Such an inadequate system of ex-
animation for the state banks has
aroused the apprehension of State
Bank Commissioner John Q. Royce,
and he viii not only ask the next leg
islature to increase the number Of
bank examiners assigned to his de-
partment. but wiz further recommend
a new and more thorough system OF
bank examination.
In his forthcoming report, Mr.. Royce
says:
"Our present law provides a system
of reports, directors meetings and ex-
aminations which are designed to in
form the department at nine different
times throughout the year the actual
financial condition of each bank in the
state. It would seem shat with such
vigilance 1t would be Impossible for
any bank officer to deceive the depart
ment as to the condition of his bank
and that the appropriation of bank
funds would be practically out Of the
question, yet even with the strong pro-
visions of the law which we now have
and the most Watehful care of the
bank commissioners, bank failures
are not entirely unknown, nor
are the affairs of some banks
always IN as good condition as
they should be.
"All Of this proves to me that 1t Is
r7171nh = of f7n n7r.
aminations as the thoroughness of the
work done which affords protection.
With the great increase IN the number
Of state banks, the deputies now pro-
vided by law are inadequate to make
such examinations as the law contem-
plates, and the number Of deputies
should be increased to properly care
for the work, even under the present
Plan Of examinations. It VIII therefore
be necessary for the legislature to
make some provision looking to an in
crease OF the force in the banking de-
partment of the state If we are to
have such examinations as the law
contemplates
Would Change Plan of Examination.
with view to absolute safety in
bank examination, I would recon-
mend that the present force OF depu-
ties be increased in number so that
each bank under state authority can
be examined at least once each year
in the presence of the full board
of directors, at which time the entire
assets of the bank can be examined
and inquired into fully by the exam
iner and the board of directors Such
an examination would amount to a
second or double examination. 1t
would Of course be unwise for an ex-
aminer to send notice to the directors
! to meet him at the bank on any day
which he might name. for this would
give notice to the bank that an ex-
! animation would then be made.
'tThe examiner could, however, visit
the bank without notice as at present,
and make just such an examination as
he does now, and after making a COM
plete record of the condition of the
bank on that day, he could notify the
board of directors to meet him at the
bank on a day which the examiner
; would name, and in the absence Of
/ the cashier or other officer in charge
| of the bank, make a full and complete
examination of all the assets of the
bank; examine securities, deposit ac-
counts and in fact anything about the
Institution that would make the ex-
aminer and the board Of directors as
familiar with the business as the
cashier or other officer of the bank
who had made the loans"