Evening bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1895-1912, 1909-10-08
Comptroller Murrays
Problems Of CURRENCY

fore the Bankers Association meeting
at Chicago recently Of the Hon. Law.
renee o. Murray, the able, militant
comptroller of the currency. Mr.. Muir
ray covered much of the same ground
covered in his circular letters to ma.
tional banks, in recent months. He
acknowledged In the opening that
there has always been great deal
of criticism of the national bank ex-
aminers, and perhaps there Always
VIII be. Some Of 1t is Just; much of
II is very unjust When | became
comptroller | determined to find out
exactly how the bank examiners did
their work, and there seemed no bet.
ter way than to ask the bankers them.
selves. A letter was sent to the presi.
dent of each national bank. asking
how the examiners were doing their
work; whether or not II was being
well done; and whether the examiners
took time enough TO go into the de
tails of the bank as the law contcm.
plates; and asking them. In general
way to point out every defect in bank
examinations"
On the subject of bank promoters
Mr.. Murray said:
Every comptroller of the currency
takes natural pride In seeing the
banks grow In number, IL strength.
and In popularity. believe in the
expansion of the system but ! believe
that that expansion should be along
normal. safe and conservative lines.
do not believe In the organization of
u bank In community where there
Is no good reason for i'r existence. 1
do not believe in the organization of
banks In communities where the bust.
ness that would naturally come to the
bank Ii IN sufficient to warrant sue
cess: nor do | believe In the Orglniza.
ton OF any bank in q community
where the board of directors will not
bo composed OF men Of business abil.
ity equal to the best to be found In
that community.
| II We are to have grcit system
of banks. sound. well managed and
|
scrutiny must be exercised before the
government issues IA charter In the
| national system wa want banks orgl.
| nized In places where the demand Is
spontaneous ana orlgln9tcs with the
people living In T.. = pIane who feel AN
actual need of banking facilities.
do not believe In the organization Of
banks by promoters who go about the
country, calling public meetings, and
by methods of advertising characters
tic Of tile circus, endeavor to arouse
enthusiasm for the organization of a
bank.
In some cases the promoter is salts
fed to organize a bank for fee Of
| five to ten dollars on each share of
stock, while In others he Is cOntented
with commission of from three to
six per cent on the capital stock and
surplus fund. In other cases he ex.
presses willingness to organize
| bank with the understanding that he
Is to be elected to Ofiicc, receive
salary. and be given the privilege Of
| terested, loan the funds OF the bank
! on commission basis. There is still
! another type of promoter who makes
a business Of organizing banks for the
cole purpose of having his company
/ supply furniture and fixtures. And in
some cases promoters have charged
, the bank more for organization ex-
penses than It's net earnings would
amount to lin five years. II II should
not lose a dollar In bad debts.
The comptrollcr's Office knows
every bank promoter now operating
and has special report on file con.
corning him. II has full Information
as to the methods used, not only as a
general rule, but In each particular
bank. II has a fairly good file Of the
alluring advertisements and the hand.
bills which they have spread broad
cast In the places where banks have
been promoted.
As soon as an application comes tn
the Office foi the establishment OF a
bank, n II bears any OF the earmarks
Of the application of a promoter, al
though his name may not appear upon
1t. n letter IL written to every man
signing the application. raising these
questions: First, did the idea of the
| organization OF the bank originate
with the people of the community
themselves. and IL II the OutgrOwth
Of necessity for banking facilities,