The Washington herald., 1907-10-28

New York, Oct. Z7.-Bankers generally
took reassuring view Of the situation to-
day. J. Edward simmons, president Of
the Fourth National Bank. and William
a. Nash. president of the Corn Exchange
Bank. and acting chairman OF the clear
ing-house committee. predicted quick re-
turn. now that clearing house certificates
are being issued, 70 normal condition Of
business affairs.
3. Hepburn, president of the Chase
National Bank. while equally certain that
the crisis is past, believes that it ought
10 serve as an object lesson for Congress
and result In an enactment of proper
currency reforms at the next session.
As a further remedial measure nearly
all Of the trust companies consented to-
night'to pay depositors in checks on clear
ing-house banks-The trust companies viii
pay out cash in small amounts when it
IS needed for necessities, but all with
drawals for business purposes viii be in
the form of checks.
The trust companies are the largest de-
positors of the banks. If they pay in
cash there results a drainage on the
banks. 1t is for that reason and not be-
cause Of any question of solvency Of the
trust companies that they have been
asked to pay by check.
Can Have Check Certified.
There is also the expectation among
bankers that the Withdrawing depositor,
If he does not need the money for imme-
diate uses, viii deposit the check in the
clearing house bank. or else have it GER
titled by the bank In the latter event
the depOsitOr will be secured by both the
trust company and the bank.
Interest in banking circles to-day cen
tered chiefly about the resolution which
was introduced at the Clearing House As
ISOLATION meeting on Saturday, providing
for the admission Of trust companies TO
full membership in the association. While
several Of the trust company presidents
favor the proposed amendment, it is pret-
ty certain that il is strictly a clearing
house movement.
Neither the committee of five, which
was appointed to suggest means of relief
for the situation, nor the committee Of
three, appointed by the trust companies
association, had anything TO do with the
presentation Of the resolution From
what some members of the clearinghouse
committee had TO say to-day, il was evil
dent that the resolution represents an
effort TO revert 10 the cOntentiOn which
the clearinghouse people have always ad-
vauced-that the trust companies, if they
are 10 do a banking business, ought TO
be obliged 10 conform to a much greater
degree than at present to the restrictions
which govern the business Of a bank.
Amount of Reserve m Issue.
The question OF the reserve which n
trust company should be compelled to
keep IN its vaults has been an issue be
tween members Of the clearing house and
trust company presidents for a good
many years.
4 member of the clearing house commit
tee said to-day that so per cent of the
trust companies deposits are demand de-
posits and constitute therefore practically
a banking business. He suggested re
serve for the trust companies that desire
to enter the clearing house at 10 per cent
Of their deposits
The news of the decisions of clearing
house associations in other cities Is 70
issue certificates was accepted to-day as
confirmation OF the views expressed by
local bankers that the present financial
conditions are general and not confined 10
New York The crisis in New York ap-
peared first because OF the housecleaning
conducted by the clearinghouse commit
tee which brought things to a focus.
The associations in Chicago, St. Louis,
Philadelphia, and Pittsburg have already
announced their intention of reS0rting to
the issuance of certificates, and the in
formation which bankers in this city had
to-day was to the effect that the same
plan would be adopted tomorrow in pTac-
tcaly every pig commercial center in the
country.
The general adoption Of the certificate
plan will relieve the demands on New
York for cash by relieving the situations
in the other cities