The Vinita daily chieftain. [volume] (Vinita, Indian Territory [Okla.]) 1902-1913, 1909-03-27
COMPARE BANKING
LAW OF TWO STATES
In Oklahoma Annual Payment Is Five
Times as Much as Under the
Kansas Plan.


the new bank guaranty law passed by
the Kansas legislature have been re-
ceived here and some interesting com
parisons are being made between it
and the Oklahoma law. The most not
able difference between the two laws
being in Kansas it is wholly volun-
tary, while in Oklahoma it is com
pulsory, but there are other radical
differences between the methods en-
ployed by tn two laws to reach the
same end,
One of the features in the Kansas
law which has caused comment here
is the smallness of the annual assess
ment. That law requires a deposit in
the first place of $500 for each 100000
or deposits, or fraction thereof, less
capital and surplus, which is practi-
cally an assessment of one-half of !
per cent. and provides for an annual
assessment of one-twentieth of ! per
cent thereafter until a fund of $780,
is created, exclusive of the bonds or
cash put up for the original deposit
The Oklahoma bankers had to put up
per cent of their deposits, without
any deduction of capital and surplus,
the first year. or more than twice as
much as the Kansans and are requir-
ed to pay am annual assessment of one
fourth of per cent, five times as much
as under the Kansas plan, until 5 per
cent has been paid in altogether.
Both laws provide for an additional
assessment to replenish the fund in
case of bank failures The Kansas law
provides that there shall not be more
than five assessments of one-twentieth
of ] per cent each, in any year, while
the maximum assessment for any one
year under the Oklahoma law is per
cent
The privileges of the Kansas law
are forbidden to any bank which pays
more than per cent interest on its
deposits. Under the Oklahoma law the
maximum Of interest 70 be paid by
state banks is left to the control of
the bank commissioner Both laws
have the provision that deposits shall
not exceed ten times the capital and9
surplus
The payment of the assessments
provided for in the Kansas law is en-.
forced by the provision that when
bank fails to pay any assessment,
the bonds put up as the first deposit
may be sold and the required amount.
taken out of the proceeds. In case of
continued default in payment for sixty
days all the balance of that deposit
is forfeited to the guaranty fund. The
bank commissioner is also required
to make an examination of the books
of such bank If found insolvent he
is to take charge and liquidate. If,
solvent he shall cancel its certificater
as a guaranteed bank and cause to-
be displayed in it's banking rooms a.
card 2Ox30 inches, bearing in large
letters the inscription: y
This bank has withdrawn from the
bank depositors' guaranty fund and
the guaranty of its deposits will cease
after. r........." (date to be six
months distant) d
A bank may voluntarily withdraw
by notifying the bank commissioner
and displaying the same sort of card
for six months, and may receive back
its bonds as soon as the affairs of all
banks in liquidation at the time shall
have been closed up. ~
The Kansas law requires a bank to
have a paid-up surplus equal to 20
per cent of its capital before it eau
be admitted to the guarantee. New
banks have to be in operation year
before being admitted.
Advertising or conveying the i'm.
preston that the deposits are guar
anteed by the state is misdemeanor
under the Kansas law, punishable BY
a fine of $500. and advertising bank
as being under the guarantee fund
when it is not is subject to a similar
penalty. A similar provision to this
last is contained in the Oklahoma law
but no definite reference is made in
it to the proposition of advertising
that the state guaranteed the deposits
Attorney General West holds that it is
not in violation of he law. but Bank
Commissioner Young is strictly re-
pressing any such advertising.