The San Francisco call., 1908-03-04
BANK BOARD OF NO
USE, SAY BANKERS
Financiers Tell Legislative Conn
mittee Clearing House Exam
iner May Be Selected
Rigid Rules Will Govern COm=
bined Savings and Commer-
cial Institutions Hereafter

Dual banking was discussed by the
legislative investigating committee on
banking laws at two sessions yester-
day, which were attended by several
prominent San Francisco bankers, who
said that the state bank commission
was useless and declared IN favor of a
clearing house examiner Dual bank
ing is the tabloid phrase TO describe
bank that conducts savings and COM
mercial business in conjunction, loan
ing out the savings deposits without
regard to the restrictions which are
placed by law on banks that are char
tered solely as savings banks.
The work of the committee pro-
gressed to the extent that suggestions
were made to it that laws be passed
abolishing such combined institutions,
or that more drastic measures be
adopted, permitting banks to continue
in their dual capacity, but forcing them
to comply with such restrictions for each
department as the law provides for the
separate institutions.
On the invitation of the committee
Homer S. King. president of the San
Francisco Clearing House association;
Frank B. Anderson Of the Bank of
California ]. w. Hellman Jr. of the
Wells Fargo Nevada national bank and
p. N. Lilienthal of the Anglo-Califor-
nian bank sat with the legislators yes
terday. Senator E. I. Wolfe announced
to the committee that he had invited
Superior Judge George Sturtevant to
meet the committee Friday afternoon
and discuss the banking laws, with
which Sturtevant became familiar
while assistant attorney general.
BANKS PLAN SAFEGUARD
Senator Leavitt, chairman of the
terday by asking of Homer S. King:
What in your opinion was the cause
of the late stringency and what in
your opinion is the trouble with the
present banking laws in the state Of
California;"
King replied that there would have
been no stringency in San Francisco if
New York had not shut down on
money.
P. N. Linenthal, in discussing the
latter part of Leavitt's question, said
that the clearing house was consider
ing the engagement of a competent
bank examiner who would report on
the condition of all clearing house
banks. The penalty for bank not be-
ing up to standard would be disbar-
ment from clearing house privileges.
Anderson said that the bank COM
mission did excellent work so far as
only on the surface.
What consequence do you attach
to the bank commissioners reports?'
asked Senator Curtin.
Il don't believe the public gets any
benefit" replied Anderson. The work
should be done by trained man, and
you can't get trained man for $500
year"
"One way to guard the banks" said
Heliman, would be to enact a law maxi
money while it's raserve IL under the
established per cent"
WOULD ABOLISH DUALITY
At the opening of the afternoon ses-
sion James M. Crittenden, who was
president of the suspended Bank of San
Luis OF San Luis Obispo. was given
the privilege of the floor and at
tackled the law giving bank commits
sioners the power to close a bank.
e. F. Woodward, surveyor of customs
and a banker at Santa Rosa, made a
strong appeal for divorce of combined
savings and commercial banks, or dual
banks. He considered them a danger.
Hellman suggested that reform might
be accomplished by making such g.
bank comply with all restrictions
placed on both savings and CONNER
cial banks.
But there is no objection to bank
doing dual business" Hellman con-
tinued, IF it keeps a proper reserve
But still you would put the limita-
tions of both types of banks on a dual
bank?" asked Leavitt.
"Yesn said He1irnan.