Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-10-19
Acting Controllers Statement.

In commenting upon this failure T. P.
Kane. acting controller of the currency,
said:
Until the passage of the act of Con-
gress of June %. 1906 any sort of wild
cat banking venture could be started In
the District of Columbia under charters
obtained from the states. Banks of this
character were under no supervision what
ever, and Washington was a promising
field and safe harbor for them
Since June % last all savings banks.
trust companies, or other banking fnsh-
tutions organized by virtue of the laws
of any of the states, and having an Office
or banking house located within the Dis
trict Of Columbia where deposits or saw
ings are received, were placed under the
supervision Of the controller of the cur
rency and are required to make sworn re-
ports to the controller and be examined
the same as national banks.
Result Of First Examination.
THE closing Of this concern was the re-
suit OF the first examination made Of its
affairs by the national bank examiner.
Its principal business seemed to be the
guaranteeing Of bonds and stocks Of I'M
known or questionable value and It's prin-
cipal assets consist of securities of this
character
wildcat or speculative banking will not
be tolerated in the District of Columbia.
troller Of the currency to prevent such
banking.
Regarded as Of Flimsy Character.
1t is learned that an examiner from the
controllers office several days ago started
on round of examination of the savings
banks In the District of Columbia under
the recently passed law giving the con-
troller that supervision over savings banks
The examiner reported that the bank was
clearly insolvent. and this caused prompt
action by the controller.
The controller has not yet any means
of knowing whether the parent bank will
come to the rescue Of the local branch
The former has been estimated to be well
fixed. it's home being in Butte. Mont. where
rich men are said to be at the back Of It,
Whether this is true or was merely used
in inducing business when the Washington
branch was started the controller has no
means Of officially knowing. If the Mon
tana institution, which Is incorporated I'M
der West Virginia laws. should take up
the liabilities Of the local branch there is
possibility of resumption Of business.
Without assistance from some quarter 1t
is estimated by the controllers office that
there will be heavy loss to Washington
depositors and those interested in the bank
The controllers office points out this case
as an instance of the benefit of the last
laws enacted by Congress. but officials in
sist that the law does not go far enough
and should throw around local banks the
same laws as govern national banks This
would enable a closer and more advantage
Gus supervision of the savings bank
The controllers office proposes to continue
Its examination of the Washington insti-
buttons of savings character. but does
not anticipate any further weak ones Sus-
ptcion has been directed to the failed bank
for some time.
Not Locally Identified.
The announcement that the institution
had been placed in the hands Of a receiver
did not create much interest In local finan-
cfal circles today for the reason that the
company had never entered to any extent
into local affairs. and but little was
known about it or the character of it's
business. 1t is concluded from the ex-
animation that has thus far been possi-
BILE that a good proportion Of the money
on deposit savings Is In the shape of
small accounts. Including the savings
and the commercial or individual ac-
counts, the total amount shown to be on
deposit is about $4,000.
1t Is not known, of course, to what ex-
tent the parent institution will be able to
come to the relief of the branch. and thus
make good the funds which have been