New-York tribune., 1910-02-06
CHENEY TO BANKERS
TO SECURE SAYINGS.
Segregation from Commercial
Deposits Recommended.

slhanv. Feb SO. II. Cheney, State Su-
periufendent Of Banks. IN an address at
the annual dinner OF Group 8, New YORK
State Bankers Association. at the Ten
Evck Hotel tonight, declared that the
segregation of proviGent savings deposits
from commercial deposits would be the UNI
persaI law in a few years. He explained
why he recommended TO the Legislature
that purely savings deposits when founo
in commercial bank or trust company
doing business in this state should be
segregated from the ordinary commercial
deposits and invested in the manner re-
quired by the state for the investment of
these deposits in a savings bank
Mr Cheney said in part:
II is proper to characterize the banking
law u the State of New York as one OF
the most adequate ana effective sets or rules
for the conduct Of the banking business
ever enacted. 1t enables the efficient and
honest banker 10 build up safe and con-
serYative business without interference
fron1 The interruptions and dishonest. The
respect and the nigh regard our banking
law commands is evidenced by the fact that
whole or in Tart. while others have freely
commended It's wise provisions.
Tor many years the State Of New York
has very properly prescribed the manner
in which the trustees of our savings panhS
shall invest the savings placed in their
this provision the evident legislative intent
Was to see that the funds OF these people
should be protected with the highest pos
sibie degree of safety. The remarkably clean
record with which one-fourth of the purely
savings deposits of the whole United States
has been administered in this state mas
been a credit indeed TO the commonwealth
This state, having so successfully eStaD-
nshed the principle that the savings OF our
poor shall have the highest type or protec-
lion which can be afforded, further step
WAS taken
Realizing the inexperience Of these de-
Il sNy-~-N
become acquainted with business condl.
lions, our Legislature enacted Section I0o
Of cur banking law. That secuon, p, proves ICES
than a savings bank shall make use OF
7he word savings in its banking DuSl-
ness OF advertise or put forth any adYer-
tisins literature or sign SIS a savings pank,
or in any way solicit or receive deposits as
= savings bank
growing tendency on the part Of Few OF
our commercial banks, both state ana ma
1ional. and some Of our trust companies; 70
go outside OF the field OF operation 1or
which they were created and enter INTO
competition with our savings banks py
soliciting for the proyident savings oe-
posit In doing this they nave adopted the
savings bank privilege of requiring pres
entation of the passbook for the purpose 2 3L
withdrawal, and the further savings bank
privilege of a sixty days notice OF lnten-
ton &c withdraw
believe in the principle of giving to the
savings Of the poor the very highest pos
sille t--pe Of safety. avoiding the subJecuon
of such funds TO the dangers incident 10
commercial business, however shght sucn
Further than that. II seems to me logical
that, II one OF our financial !nsu1uu9QlIs
with the right TO receive deposits payable
only upon presentation Of q passbook ana
with the right to exercise the pTlVllese OF
sixty DAYS notice OF intention 20 wlstlo1a~,
Is required TO invest such savings deposits
yn a certain kind of securities, another
financial institution doing exactly the same
kind Of business upon the same paSShook
,aresenrarjon basis and sixty days nouce
Of intention to withdraw should be required
70 invest such deposits IN exactly the same
The Superintendent Of Banks has. there
fore recommended to the Legislature tlat
1,,J7-e1v savings deposits when found IN
commercial hank or trust company oolnS
business in this state should be segregated
from the ordinary commercial depoSiIs ana
invested In the manner required pE Ihe
sta+e for investment Of these deposits IN a
relieve fIfat this principle of segrega
+sc,, eiio,,fd anr,ly 10 The national banks
6ai~c business IT, this state as well as TO
our state institutions. The time IS raplolE
approaching when the segregation OF say
Ings deposits viii he enforced throughout
the country Already II is in operation IN
eight states Of the union. -. =
The National Monetary Commission Is
considering II the proper dispositon OF
the S2-5 00N 00G of savings deposits thal are
held hv tha national banks Of the country.
II has been stated before the Congressional
committee that the need for postal savings
banks in this country is due largely 10 the
safeguard all their savings deposits.
The only objection / have heard against
segregation has been on the part or
few bankers who have expressed the fear
that the earnings of their institutions
would he materially lesSened by such
provision il our state laws.
NJ Cheney said that a study Of condt-
tions in other states had revealed the fact
that there was no basis for such fear
He added, IN closing:
Gentlemen. segregation Of proVldent saw
iugs deposits from commercial deposits
viii in a few years he the universal law
II is consistent. il is logical, and, above all,
Il is right in principle.
When the proposed amendment IS readY
for the consideration of our Legislature,
ample opportunity will be afforded You TO
study its provisions. I ask that you give
Il YOUR serious attention and consideration,
20 the end that If the provision IS wise, 1t
NAV have your hearty support
The group elected these officers for the
ensuing year: Chairman, Delmar Runkle.
Boosick Falls; secretary, W. f. Polk,
Troy: executive committee, Jacob II. Her
zog and T. I. Van Antwerp, Albany; 6. B.
crippen. Worcester: II. A. Humphrey,
Chatham. and F. Hewitt. Granville.