The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1910-07-11
PLAN TO prevent
BANK A|LU les
Currency Controller Aims to In
duce Weak Institutions Into
Voluntary Liquidation.
ALIENS AWAIT POSTAL BANK
Eighty Postmasters Want to Re
~ceive Savings and, "a Banks
Apply for Deposits.

Washington. d. c., July 1o.-Control-
Ter OF the Currency Lawrence o. MUIR
ray. who has instituted many reforms
for tightening control over national
banks, is contemplating another by
which, with the cooperation lof the
banks themselves, he hopes to reduce
national bank failures to minimum.
Fills scheme is nothing less than OH
tanning the consent OF two thirds Of
the stockholders of banks in weak
lcopdition to 1iquidate the debts and
dissolve the institutions.
Mr.. Murray is of opinion that most
failures in recent years were of banks
that should voluntarily. have wound
up their business and disorganized Tn
der the law he has no authority to
force bank dissolution, but his plan
| is that when the mismanagement or
| financial condition OF bank is such
as TO require four examinations a
year, will take steps leading to vol
untary liquidation on the part OF the
bank
If objection is made. the controller
may insist on one OF three courses
either that the bank be at once placed
in a satisfactory condition In accord
ance with the report OF the examiner.
or that new management be. pro-
vided If the old one cannot rehabili-
tate the bank. or that voluntary haui-
dalton be determined on and the bank s
affairs wound UP.
| The Controller can WELD a powerful
influence over the bank officers and d.
rectors by pointing out the ADVANTAGES
of quietly closing up business and
4 la, do fpc o. w is time. and
when the debts can be settled In full
compared with the disadvantages OF
suffering failure which would make
the stockholders liable for twice the
amount OF their holdings. What would
follow in the ordinary case would be
| reorganization or voluntary ltquida-
| ton.
1 Although practically certain that no
| postal savings banks will be estab-
Ilished under the new law until next
year, eighty postmasters have already
written the Post Office Department
asking that their offices be made into
savings banks. as provided by the stat
ute. At the same time seventy-four
banks have sent application to the de-
partment to receive Us deposits from
1.-THE government the moneys deposited
lin the postal banks In theft localities.
This number Is of course, small in
4 proportion to the number of banks
that might be interested, but it is sup
4 posed that the postponed inauguration
of the system may have restricted the
number of applicants.
Opposition to the postal bank bill
came largely from New England. but
strangely enough, the postmaster a,
4 Meriden. Conn, writes that the most
g prominent citizens OF the town are
asking for the opening of the govern
ment banking Institution. Another
d postmaster in Pennsylvania writes that
. a large foreign population in his local
Iity is waiting eagerly for the govern
iment bank. as the foreigners are afraid
Ito risk their savings in private insti-
II tutions
To the surprise OF the department. q
VI New York postmaster. describing his
village as the largest in the State, said
that 1t had no bank and that his office
did postal money order business OF
n $1,000 month A great demand has
I grown UP there. he wrote. for the
I prompt opening of postal bank
j In the West good deal Of uncer,
tainty Is felt as to the kind of security
that banks accepting deposits from Thu
government of the deposits made Il
the postal banks must produce. Tht
Il Board OF Trustees will have such ques
i lions all settled before the establish
ment Of the system is-undertaken mex
|. year.