The advocate. [volume] (Charleston, W. Va.) 1901-1913, 1910-09-08
THE OKLAHOMA BANK
GUARANTY LAW

l. The State banks Of Oklahoma had
$18,000,000 Of deposits when the
Oklahoma law went into effect Feb
IA, 1903. Since that, time. 163 State
banks We're chartered, including
lseventy-three conversions from Ma
tional banks to State banks up to the
report Of June 23, 1909.
| The number Of State banks has
Increased from 40 to SCI, to Nov.
I l6, 1909, and the individual deposits
in State banks increased from $18,-
100000 to $49,775,OOO
| The National banks, February IA,
1908, were 312 in Oklahoma. On.
June %, 1909, there were 222, nine
tty National banks having converted
and liquidated since the guaranty
law went into effect.
- The average reserve held for the
State banks, November 16, 1909, was
49.7 per cent, about as su bstantial
a reserve as is held by the Bank Of
England.
! The National banks have not in
creased in deposits to any substant-
ial extent, the National banks having
had $38,29S,00O, February IA, 1908,
and $38, 1000, June 20, 1909, but
fare entitled to credit for 100000
Of deposits transferred from the Ma
tional banking system to the State
banking system by the conversion Of
National banks.
I The State Of Oklahoma has the
best banking system in the United
States. 1t protects the small de-
positOrs and gives him confidence
and when there is loss due to mis-
management, the loss is distributed
| in such manner that it Is not felt
| by any Of the contributing banks. 1t
| is after all, merely mutual in
surance plan, the insurance fund be-
ing administered by the State
|. / established the First Natl Bank
in Oklahoma and was president Of it
ten years, and | admire the record of
the National banking system Of the
last ten years as far as the safety to
the depositor is concerned. Yet, one
| cannot forget the violent disturbance
to commerce and the injury to bank
depositors which followed the en-
barrassment Of the National Bank
t Of Commerce Of Kansas City, in
1907, a fine institution with deposits
Of $35 900, 900, which paid in cash
over $17,00O,000 before closing it's
doors. This. tragedy was due to a
suspicion and a run, excited by a
circular letter of an oil company, ad-
Vising against taking drafts on this
bank at the time of the panic.
The Walsh failure, in Chicago, and
the Morse-H einze failures in New
York, greatly disturbed the country
| when there was no sufficient reason
to justify it and when an insurance
fund would have made such a
catastrophe impossible. 1T is UNI
fortunate that the enormous power
Of the great central banks should be
encouraging the opposition to a sys-
tenn so wise and so sound as the
bank depositors' guaranty plan--a
mutual insurance plan; one hundred
tn part Of one per cent, of the de-
posts would suffice for insurance
and the stability Of the banking sys-
tenn of the country would be greatly
promoted by this method applied
both to State and National banks.
The banks require customers to
give. security for a loan. The State
ought to renuire the banks to secure
their deposits. 1t will be better TO,
the depositor and better for the
banker, but what is Of more i'm
iportance, it will be better for the sta
bility Of the commerce and the bust
ness interests Of the Deole of the
UNITED States-U. S. Senator r. l..
lOwen in Norman r. Mack's National
monthly for September