The Montgomery advertiser., 1908-01-08

interest or any funded debt authorized to be contracted bv it. and which has at such date more than 10000 inhabi- tants as established by the last census and whose net indebtedness does not exceed 10 Dercentum of the valuation of the taxable property therein. to be as- certained by the last preceding yaIua- tion of property for the assessment of taxes; or the first mortgage bonds of any railroad company. not including street railway bonds. which has paid dividends of not less than { percentum per annum regularly and continuously on its entire capital stock for a period of not less than i've years previous to the deposit of the bonds. The Treas urer Of the United States, with the approval of the Secretary of the Treas ury. may accept for the purpose of this act. securities herein enumerated in such proportions as he may from time to time determine. and he may at any time require the deposit of additional security or require any association to cnange the character of the security al- ready on deposit.
 Section 3. That all bonds deposited to secure circulating notes issued in accordance with the terms of this act shalf be transferred to the Treasurer or the United States in trust for the association depositing them. with 6 memorandum to that effect attached to. or printed on each bond and signed by the cashier or some other officer of the association making the deposit. A re- eeipt shall be given to the association by the Comptroller of the Currency, or by clerk authorized by him for that purpose. statinE that such bond is held in trust for the association on whose behalf the transfer is made and as se- curity for the redemption and payment of any circulating notes that have been or may be delivered to such associa- tion. No assignment or transfer of any such bond by the Treasurer shall be deemed valid unless countersigned by the Comptroller of the Currency. The provisions of the sections 5163, 5164, 5f65. 516s and 5l67 of the revised stat utes respecting United States bonds deposited to secure circulating notes shall, except as herein modified. be ap- plicable to all bonds deposited under the terms of this act.
 Thc Existing Law.
 The remaining portions of the bill consist of additions to the existing law. These additions provide for a tax on the average amount of such notes of banks circulation as are based on the deposit of bonds other than bonds of the United States, provision being made in this section for tax on notes secured by Panama canal bonds amounting to one-fourth of 1 per cent each half year on notes secured by per cent bonds.
 Associations having on deposit bonds bearing interest at higher rate than 2 per centum per annum are required to pay a tax of one-half per cent eacn half year on notes thus secured.
 A monthly tax of one-half of one per- cent Is imposed upon the average amount of notes issued on bonds other than bonds of the United States and monthly returns under oath, are re- uuired of an association to show the average monthly amount of notes so secured in circulation.
 Exemption United States bonds call- ed for redemption by the Secretary of the Treasury. 1t is permitted by the bill that national banking associations may withdraw their bonds held for cir culation security bv the deposit of law full money to a Droportionate amount.
 Provision is made for the engraving of suitable notes in convenient de- nomination. These notes are to state upon their face that they will be re- deemed upon presentation at the Treas ury Deparment and they are required also to express upon their face the prom ise of the association receiving them to pay on demand. Circulating notes in blank to a certain amount may, upon request, be prepared by the Govern ment and placed for an association in a convenient sub-treasury and be held for that association subject to the order of the Comptroller of the Cur. rencv.
 A section of the bill provides that "circulating notes of national banking associations when presented to the treasury for redemption as provided in Section 3 of the act appSoved June 20, 1874. shall be redeemed in lawful money of the United States.
 The bill also requires that national banking associations located outside of reserve or central reserve cities, which are now required by law to keep a sererve equal to IS per cent of their deposit liabilities. shall hereafter hold at all times at least two-thirds of such reserve in lawful money"