New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1909-09-25
TRUST CO.'S FLOURISH
ESSENTIAL THESE DAYS.
Important Feature Of Development
Of .lmcicaR Finance.

IN I'll. ir present form trust companies HoHS'-
tute an original and essentially American az
volopment in financial machinery The p"ss'hi"-
ties Of trust companies aids Z" financial ana
commercial Development have been oNlahH''
and demonstrated To- IN" fullest extent. p''r'l'"-
Iarly by the companies In Now York CITY IN
their carly days trust companies 20 h''vh as l''r
as 1922 and $3.50 TIE first companies as "a < n
eral hing incoris rated in their plans various
forms OF insurance. hut their main purp 'S'
was 10 act rs executors, guardians and trustees
Of property in litigation, ana in administering
property. investing funds. collecting rents, etc
GRADUALLY their activities extended beyond these
limits and they became highly useful as Ell
as profitable with the result that 81 many COM
ranies were formed that the state authorities I'D
1887 were compelled 10 enact a general IN" iot
their organization and conduct
In all Of their relations especially o "N"'u-
tors and guardians, trust cumpanies have the
advantage Of offering continuity Of life and cor
pOratiun responsibility over indl'tcualS p"e OF
the greatest usefulness of trust companies as
they are now constituted lies in iher functions
as Intermediates FOR the public and cor
porations. acting as trustees under corporate
mortgages and as underwriters 90 bonds ~ IN
.iustrial and railroad corporations, and ~ coun-
ties municipalities and states They ct ms
fiscal agents in New York of corporations ana
as transfer agents FOR The securities 81 corpora
tons thus complying with th' requirement. o.
the New York Stock Exchange for adrtaat"
checks upon The securities which the 'NoA"HSr
handles
The trust companies have a.>. gone extensive
j. into banking lines. Many co. tU'iE tr"usa
a regular banking bu>in~ss. di-."untng paper
f5r their customers ana acting generally az
banks 81 deposit. I ndcr the law the trust COM
panies can 10 anything that bank Of deposit
Is authorized To accomplish. except - issue
circulating notes. Certain immunitI's in taxa
ton extended 10 trust companies, greatly %
their advantage. Companies aro required u in
vest their entire capital in securities. which
completely guarantees the safety OF tho fund.
Numerous activities are placed within tile
scope Of the trust companies by law. For in
stance, they NAV act ~ executors, admins
traitors. guardians, committees II incompetent
Iersons. trustees under Wills or under appoint
ments by decd. Trust fund properties may com
prise real estate. moneys or personal securities
and the maker 81 q trust may stipulat' among
other things that the trustee company may in
vest in securities not authorized 10y law. 80 that
the trust may have the advantage ~ an income
increased over that which would accrue If the
investments We're merely in securities OF the
class defined by the law governing the invest
nents OF the company.
Trust companies find a profitable income in
acting agents for real or personal property.
Upon occasion they act as secretary 10 their
customers during the latteFs absence from the
country. Charitable institutions employ them
as treasurers and agents.
There are thirty-eight trust companies in the
Borough of Manhattan. with a combined capital
If about $4S,OG1O0D. Their deposits total ST.
COZ. So. 40 ana loans ana investments $685.
2:12 300.