Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-10-16
WASHINGTON MEN PRESENT
Lessons to Be Drawn From the Re
cent Bank Failures in
NJ This Country.

Hundreds OF prominent bankers, repre-
senting every state and territory, as well
as the United States dependencies. are here
as delegates and officers of the associa-
ton place the total attendance. including
delegates and unaccredited visitors at
1000.
The principal meeting of today was the
eleventh annual assembly of the trust COM
pany section, which was called to order
by Mr.. Clark Williams. vice president Of
the Columbia Trust Company of New York
and president OF the section. Rev. William
j. McKtttrick delivered invocation, followed
by the address OF welcome made by Mr.,
Festus J. Wade. president Of the Mercan-
tile Trust Company of st. Louis.
President Clark Williams of New York
replied to the address of welcome and de-
nvered his annual address.
President Williams Speech.
President Williams said in his address:
I'VE are a part of the warp and wool of
the financial fabric of this country. and It
Is TO our interest to stand as an integral
part of the American Bankers Association
which aims to bring within its folds the
financial powers of the United States
The unctions of national or state banks
and trust companies are cooperative rather
than competitive and 1t is a satisfaction to
recognize in this common association the
evidence of a friendly independence be-
tween these classes of institutions.
From a small beginning ten years ago
the trust company section has become
great power with its 100 members, whose
assets run into the billions of do..ars The
enormous growth of the trust company
system. as the result of the demands of ex-
listing business conditions. and the progress
sixe spirit of our times has required g. re-
Spouse from this organization, and we are
under an ever-increasing responsibility to
see that the power which in MS lies is
directed to the protection and safeguarding
OF our institutions. 1t has been our pur-
pose so far as possible, to secure the en-
actment OF laws in the different sta ties pro-
hibiting the use of the word trust In the
title of any corporation not moneyed cor
pOration or chartered to do a trust company
business. We have also endeavored to Sc
cure the enactment of laws providing for
adequate state supervision Of the trust
companies. requiring thorough examination
and frequent public report. While much
has been accomplished. much Is yet to
be done.
Lessons From Failures.
I'VE may contemplate with some degree
Of pride the record OF the past Some
good may come from the catastrophe of the
Real Estate Trust Company failure at
Philadelphia. and. the Stehsland Bank at
Chicago. If only the practical lessons we
may learn are of lasting benefit Nothing
could more clearly demonstrate the wis
dom of the policy in advocating adequate
state supervision. 1t seems to have been
20 lacking in this particular case that the
trust companies OF Pennsylvania are con-
sidering the advisability of calling a gen.
eral convention to demand relief from
present unsatisfactory conditions.
With the insurance investigations as a
background. and with the knowledge of the
circumstances surrounding the failures at
Chicago and Philadelphia, there has come
an awakening of public sentiment which
demands In 10 uncertain terms a keener
appreciation OF responsibility by those hav-
ing in their care the affairs of our financial
Institutions.
Are we not In some measure responsible
for the lax and perfunctory performance
of their trusts by directors? Are we not
In some satisfied with star chamber
proceedings or kltchen-cabinet manage
ment?
- believe 1t to be the duty of every trust
company official not only to his institution,
nut to himself, to adopt such means as are
best calculated to keep the directors of his
company closely In touch with its affairs
not only by formal report, but by requiring
their frequent personal examination of the
cash. securities and loans.
Our clerks should feel a sense of respon-
sibility that would take them farther than
personal loyalty to their officers
Employment In trust company imposes
well a trust to the patrons of the insti-
tuition and to the public at large These
men are human Their first impulse to re-
veal wrongdoing and depreciation Is fire.
Quently overcome by the sense Of depend
ence. and they answer their conscience In
the easiest way-"It is none of my busi-
ness" 1t Is our duty to assure them that
IT is their business. and to make Ii possible
for them TO do their full duty. / do not
advise system of tattling but rather an
IA fba rlor
least his self-respect and our institutions
pecuniary loss.
There are several well-known Washing
tonians present. One Is Milton E. Allies.
vice president of the Riggs National Bank
and one of the vice presidents of the asso-
citation. He is a member of the executive
comittee and takes lively interest I'm all
the affairs of the great body OF finan-
ciers.
w. v. Cox president of the Second Ma
tional Bank. was appointed a member
of the committee on legislation at the last
convention and will have a good report
20 make of his labors during the year.
The trust company branch. which has an
organization distinct from the parent body
OF bankers. has prepared a program of
great interest to it's members. Edward
]. stellwagen of Washington is a member
of the executive committee OF that Sec
ton.
Z. Quincy Smith. also of Washington,
Is also prominent member of the savings
bank section.
The annual report of the secretary James
r. Branch. New York, showed a credit
balance for the fiscal year ending Septem-
Der l. 1906. OF S59S. 60. The net cost of the
trust company section of the association
for the year was 81 49,. so. During the year
63S members had paid their o., but ow-
ing to Withdrawals and liquidations. thirty
three were dropped from membership leav-
ing 6O5. One hundred and thirteen trust
companies were added to the rolls since
September /. 1905. charging the present
membership to 11S. the largest in the his
tory of the section. The annual report of
the executive committee was delivered by
Chairman Philip s. Babcock, vice president
of the Colonial Trust Company of New
York. One of the important matters con-
sidered by the executive committee was the
necessity OF devising some plan for safe
guarding the issues of municipal securities.
A committee of three was appointed to act
Jointly in conjunction with the executive
committee in bringing about some feasible
and proper plan for safeguarding the issu-
ance OF municipal securities. and Mr. Bah
cock stated the method devised will be re-
ported during the deliberations of the con-
vention. The report of the committee on
better protection for municipal securities
delivered by Chairman Fl. P. McIn-
tosh. president of the Guardian Savings
and Trust Company, Cleveland. Ohio.
Mr.. Pierre Jay. bank commissioner for
tue SITE Of Massachusetts, was then intro
ohcN1 crd tve-tG al ADDRESS.