New-York tribune., 1908-02-28
B4NK REFORM BILLS IN.
Embody Whole Scheme of Supt.
WilEiams's Recommendations.
EBy Telegraph to The TribuneI

Telegraph
Albany, Feb 27.-Bills embCdying the whole
scheme of banking reform recommended by Super
intendent Clark Williams in his report to the Leg
slature to correct the evils in banking exposed by
the financial panic of last October were introduced
In both houses to-day by the Banking Committees.
They thirteen in number and complete the pro-
sramme of reform which was outlined. first by the
Hepburn Commission and secondly by the Super
intendent of Banks.
Perhaps one of the most sweeping propositions is
contained in a bill amending the Penal Code by
prohibiting department stores from doing a bank
ing business. A statement given out by the Bank
ing Department says: This provision is intended
to prevent an encroachment upon the business of
savings banks
The first of the bills reduces the maximum of any
loan made by state bank trust company from
40 to p per cent of its capital surplus also
prohibits underwrttten loans. prohibits loans
second mortgages. limits loans upon real estate
security and requires mortgages and assignments
10 be Immediately recorded when taken. 1t also
prohibits corporation fr depoSiting it's funds
with any other noneyed corporation unless II has
been designated as a depository by a majority OF
the directors trustees of the corporation max
ing the deposit exclusive Of any director or trus-
tee who is officer, director or trustee of the de-
pository designated. Further than this it limits
loans the stock of other moneyed corporations
conforms the section of lhe banking law relating
10 building and loan and cooperative savings and
loan associations the new restrictions with re-
gard to real estate loans and makes other changes
necessary 10 simplicity and intelligi5iltty.
The second bill is aimed at the savings depart
ment of trust companies. and IS said to be designed
protect small interest bearing accounts taken
by institutions In places where savings banks are,
situated. Tho bill provides that the aggregate Of
moneys deposited certain of these accounts shall
be invested in the same manner as the deposits OF
savings banks and makes them preferred claims
In of liquidation insolvency.
Three other bills seek TO give the Superinter,d-
ent of Banks the discretion with regard 10
a hqn and fba
branches that he has now in the case of trust
companies The number of branches of banks is
also limited by the amount of the capital of the
parent institution and give banks and trust COM
panies six months in which to conform to the law
Safe deposit companies having capital of s100-
ooo paid il cash receive the right TO open and
maintain branches in another bill At present they
do this with questionable authority in the law
Two >ther bills provide that directors Of banks
and trust companies shall cease to be directors If
they pledge or hypothecate the stock necessary to
qualify them for the office during the term for
which they elected. They also ampIffv rbe
oath required TO be taken by directors
The amortization principle is applied to the IN
VestmentS OF capital in another BILL which also
limits the investment that trust company NAV
make in the stock of another moneyed corporatfon
Monthly meetings of boards directors or trrs-
tees are required in another bill, which also pro
vtdes that written statement of all purchases
and sales of securities and OF all discounts and
loans made paid since the last regular meeting
shall be submitted all the directors at each
meeting. Punishment is provided for the intan-
tional concealment from the directors OF 6is-
counts and loans or of the purchase or sale Of
securities.
There are several amendments to the Penal Code
1t is made crime for any officer of any banking
institution to make maintain or atterupt to
make or maintain deposit with any other cor
poraton on condition that the corporation receiv-
inS such deposit shall in return make a loan or
advance, directly indirectly, to any officer of
the corporation making the deposit 1t also makes
It crime for any officer or employe OF a trust
company to make agreement express or i'm
Piled at the time of issuing Il certificate of de-
posit by which its holder may demand or receive
payment in advance of it's maturity