Los Angeles herald., 1908-09-16
NEW BANK LAW
NOW DRAWN UP
COMMITTEES DISCUSS IMP0R'
TANT MEASURE
Divides institutions Into Four Glasses.
Assessment According to De-
posits-Examiners Power
Unusual
[Ry Associated Press !

! SAN FRANCISCO, Sept. ia new
| banking act, containing many radical
| changes from the present laws govern
! ing banking in California, has beer
drafted by the several legislative com
mittees appointed by the last legis.
| lature to Investigate the banking sys-
| TENS and laws of the state and by q
committee of the California Bankers
association.
The two committees, which met in
joint session yesterday in the harbor
commissioner office, Ferry building,
today continued the discussion of the
proposed new measures which will be
introduced at the next session of the
legislature.
Judge George A. Sturtevant, presid-
ing Judge of the superior court of San
Francisco, and Attorney General Webb
took an active part in the discussion.
The proposed new act divides banks
into four classes-co individ-
ual bankers, savings banks and trust
companies.
1t provides for state banking de-
partment with a state superintendent
of banks, to be appointed by the gov
ernor at salary of $500. in charge.
A state banking fund Is created,
toward which every bank in California,
national banks excepted, shall pay $40
a year. If more money is required to
carry on the department the banks will
be assessed in proportion to their de-
posits
The state superintendent of banks is
given unusual powers in the examina-
ton of banks to ascertain their actual
condition.
The legislative committee is COM
posed of Senators John B. Curtin, e. l.
Wolfe and Frank w. Leavitt and AS
semblymen P. A. Stanton, G. M. Fisher
and A. p. Cutten.
The banks were represented by. J. M.
Henderson, Sacramento; 1. A. Moulton
and Lowell White, San Francisco; j.
Y. Eccleston, Oakland; ]. Fl. Sartori,
Los Angeles, and Elliott McAllister,
epresenting inland banks.
Conflict Is Developed
The discussion today developed a
sharp conflict of interests between
state and national banks. The new act
proposes to give the state banking
officials power to regulate all banks.
"The national banks" said Bank
Commissioner Shearer to the commits
sion, "are absolutely independent of
the state. and defy its regulations. They
may invest the money on savings ac-
counts, just as they please, while the
state banks must put deposits in only
such investments as the state dictates.
The national banks thus draw from the
state institutions.
"In Los Angeles a combination of ten
national banks absolutely dictates to
the state banks, through the Gearing
house.
"Furthermore, the national bank ex-
aminer has issued orders for them to
draw all funds out of state banks. We
demand that the national banks doing
a savings business be subject to the
same regulation and inspection as the
state banks, to put them all on an
equality"
Senator F. w. Leavitt of Oakland
took the same view and urged super
vision of all savings accounts.
J. F. Sartori of the Security Savings
bank of Los Angeles took the side of
the national banks in the argument
but was not opposed to their issuing a
statement of savings accounts segre-
gated from the other deposits, and de-
failing the manner in which they had
been invested.