New-York tribune., 1908-04-15
THE BANKING BILLS SHOULD PASS.

THE BANKING BILLS SHOULD PASS.
The banking lessons Of the panic will be
largely lost upon the state if Superintendent
Williams's bills providing for an increase i'll
the reserves of state banks and trust companies
and for the administration of suspended banks
by the State Banking Department do not pass.
These two measures were the most important
part Of the banking reform programme. The
fate of both rests with the Senate and it
should not fail to enact them into law before
the close of this present session.
If there was anything that the panic showed
it was that the state banks and trust companies
had been transacting business on too small
reserve. Bankers and public alike were agreed
as TO that. What depositors thought of the
practice may be gathered from the fact that
the whole boarding movement Of the panic
! centred on the New York City trust companies.
which lost more in deposits than all the na-
iional banks of the entire country 1t was then
unanimously agreed that safer banking meth
ods, with higher reserves, must be the future
programme for the trust companies, and it
was generally supposed that whatever other
banking legislation was passed, law reQuir-
ing increased reserves would go promptly
through the Legislature. Yet the session is
nearly over and Superintendent Williamss
bill for increased reserves. Dloderate measure
in itself, is still uDpassed and its fate is
ported to be dubious Can it be supposed that
the public has already forgotten what the
panic taught regarding safe banking? Is it
another case of the devils forgetting his good
resolutions concidentIy with the return Of
his health:
The reform Of receYerships is equally i'm
portant. and the fate of the bill 10 accomplish
! it is for some mysterious reason regarded
doubtful The panic gave Attorney General
Jackson an exceptional opportunity of giving
object lesson in the evils Of reCeivershipS,
! and he used it in q remarkable manner. When
! he got through there was apparently nothing to
! be said in defence of the existing system Of adj
ministering failed banks. Yet it Is reported
that the Senate is waiting to hear what public
opinion demands regarding receivership legis-
| latiOn! Has any one any honest doubt what
The public thinks Of making the interests of
! depositors in suspended institutions the foot
/ ball of politicians! Or has public opinion now
| 10 be always bawling at the top of ITS lungs
! in order 10 make itself heard:
Depositors will not be satisfied until the state
administers the affairs of failed banks at as
small cost as the nation does Attorney Gen
eraI Davies reported 10 the Legislature in 1902
that the expenses of many reCeiverships of
financial institutions varied from 20 to 80 per
cent Of the receipts, in some cases running up
to 50 or 90 per cent. Under the national bank
ing system the cost of receiverships has aver
aged only "a per cent. In this state where
perhaps the costs are naturally higher than
through the country in general, the expense of
rcceiversbips of national banks has averaged
81 per cent of the receipts. Superintendent
Williamss bill aims TO make state receiver
ships no more costly than national receiver.
ships. We should he loath to regard that as
the reason why politicians do not like it.