Vernon County censor. [volume] (Viroqua, Wis.) 1865-1955, 1910-01-26
NO PREVENTIVE OF
BANK FAILURES.
SPECIAL LEGISLATIVE COMMIT.
MITTEE ON BANKING DISCUS
SEES GUARANTY PLAN.
HAS A TENDENCY TO INVITE
INFERIOR MEN INTO
BUSINESS.
WOULD sEeREeATE SAVINGS
FE0M COMMERCIAL
DEPOSITS.

mort to the legislature, pFoclaiIns at
the very opening that no absolute pre-
yentIye or bank failures can be pro-
yided by legislative enactr=ents. N
the depositor, therefore, is to be made
absolutely safe and secure" says tne
committee, cit is essential that some
method be found by which his money
NAV be restored to him in the event
of the failure of bank In whsen mas
money may happen to- be deposited.
| Living as we do in this day, N. the
light of the twentieth century ciEiilza-
ton, no scheme has yet been deVei-
| eped and proved which affords TO tne
depositor absolute security The most
recent suggestion looking TO this end
is the plan commonly Designated. the
guaranteeing of bank deposits AMER
the manner exemplified by legislation
enacted In a number of stStes. This
was one of the subjects which was
most diligently and exhaustsvely con-
| sidared by this committee
! The committee discusses at iengta
the question of guarantee eof bank des
posfts,. taking for its text thes Oklaho'
ma law which has been the source
of much discussion. Speaking upon
that question the committee con-
| cluds=S:
1--WE are Of the opinion that the
guaranty law has tendency tooinvite
4 men into the banking business of in.
ferior nanlEing ability, and the extent
1 10 whinh men of such inferior ability
| will be able to secure the control of
\ banks and secure the mana cement
4 and control of the funds belonging
/ thereto, depends to considerable ex,
/ sent, On laws tending to discourage
men of inferior qualifications from en-
i tering the business and om the
strength and character of the coE1mis-
sioner of banking or other officer who
administers the banking law"
The committee made a careful in.
I EestigatR0n of the causes of the failure
CT the Columbia Bank & Trust oom'
pany of Oklahoma City, which sus.
pended and was taken over by the
banking board on the day of the ar
rival there OF the committee upon the
occasion of it's visit to that state:
~Rhe chasing of the bank caused nc
nfffIe i'm the business world dof okla
z honaa Cry says the report, "the pub
lie was not excited, there was no. run
on any other bank, state or national
Depositors apparently had confidence
that they would get their money They
h acted in an orderly and we'll behaved
fashion They drew their money Out
; of the iefanet bank and placed It Ii
/ other banks. As a matter of fact, a
: the close of business on the day at
) ter the failure, the books of every 9th
) er bank in the city showed an ihereas'
I in deposits. While the lobby Of tbs
;. bank was quite well filed with de
/ posftors, there was no excitement o
), disorder, and so far as the street wa!
!, concerned, there was nothing, TO rails
the suspicion on the part; of an,
. enc that he was passing by banl
:. whose doors had just been closed. N,
business interests in the oi6y wer
disturbed, compromised, or embal
: rassea in any manner.
'sThe committee came in contae
with great many of thee people VIII
had money on deposit in the btanl
: some of whom appeared before tn
COMMITTEE, aud all gave expression t
the sentiment that they were in n
particular Murray for their mones
that they knew it was safe and ths
y they would call for 1t AFTER the rus
s. was over"
A tabulated statement OF the growt
of Oklahoma banks, stata and natiOna
is given, covering a period of fot
4 months, and an analysis OF the stat
II ment indicates that the total deposit
d of the state Of Oklahoma, during tn
'e time. increased 43.3' per cent. in bot
n state and national banks that the il
NJ crease in state banks. during tn;
p time, was 1877 per cent, while the los
ir in national banks was 0ne-half of or
lie per cent; that during the period IL
capital of both state and nation,
banks increased approximately 10 p,
Icent., and the increased capital stoC
in state banks was rs per cent, viii
ne the decrease & stock OF national banl
IN was 20 per cent. February 90, 100
ae the capital stock in the state banR
was 80 per cent. of their deposits, al
al on February Il, 1908, the capt.
stock Of National banks was also
sir per cent. OF their deposits. On Jun
gu 2S. 1908. the capital stock of the sta
or banks was "a per cent. of their d
ss' posits. while the capital stock Of z
ne tional banks, was 251s per cent.
ca their deposits.
-ne The Oklahoma guaranty law we
ios into effect February IA, 1908. sin
ost which time 165 state banks have be,
rs chartered. 7s of which were COW,
co sions Of national banks, with $3.50
III 10000 capital.
'ns Clearing House Association.
- The suggestion was made to n
N committee by number of banker
ere that country clearing house assoc
-er lions could be established for tn
art. purpose with equally as good result
YES and 1t may be said that a number
nto prominent bankers have written Z
,co- peFs on this subject in which the I
sitfoR Is taken that the country eles
ing house association may be success
me fsiiy formed and conducted and ii
10 II VIII serve a very useful purpos
0at so mueh for The gaEgase OF affar