The Washington herald., 1910-06-05
SOUTHERN BANKS
RAPIDLY MULTIPLY
Older Financiers View Fact
with Anxiety.
A NEW MOVEMENT SETS IN
ynnux OF Farmers, Establishment OF
Industry, and Expansion of Towns
Call for More MOney-CreafiOn OF
Financial Institutions Naturally
F0Iiows-MobiIs Bankers Views.

A story is told that two OF the pro-
jectors OF a new bank IN Washington
called upon the president OF one OF the
largest financial institutions. who is re-
puted to be a wealthy man, and asked
him to subscribe TO the stock OF the pro-
posed bank
The president received his callers, rs
tened 10 what they had 10 say, and then
lectured them roundly for their audacity
IN starting another financial institution.
The banker told them Washington had
too many banks now. and that it was bad
business policy 10 start another. he said
the older banks were capable OF taking
good care OF ell the business in the city.
and could do 1t safer and more ecoAoml-
cally than a new one could. The banker
declined TO subscribe for the stock. and
the callers departed considerably disap-
pointed at the lack OF sympathy disclosed
by the rich leader IN enterprise az the
Capital.
illustrates Conditions in South.
This story is illustrative Of the attitude
of the bankers in tho principal cities of
the South, as they see smaller institu-
tions springing up all over that section.
In the past banking in the South has
been largely confined to comparatively
small number Of banks in the large cities
with an immense clientage scattered over
a wide territory In recent years this
condition OF affairs has been changed.
Banks, generally national banks. have
sprung up with surprising rapidity In
the smaller towns and sometimes at cross
roads, where several cotton mills may
have located and where banking facilities
in a small way are now needed.
No doubt the multiplicity of smaller
institutions has cut into the business
and profits Of the older Ones and 1t is
natural that there should be greater
competition for deposits, and the new
order OF things may be IN many ways
distasteful TO the big banks whose bust
ness largely came TO them unsolicited
because it could go nowhere else.
Looks Dangerous TO Them.
No doubt an element of danger seems
to exist in the minds of the older finan-
cIers lest some of these new banks viii
be forced into suspension with attendant
loss to investors and possibly their at
titude is no more logical than that Of the
Washington banker referred 70 ma
tural limit may exist in any city and n
any part Of the country beyond which
banks should not be multiplied, but it
is hardly conceivable That this limit has
been passed IN the South.
All information from the Southern
States agrees that new Industrial and
commercial movement has set In there
that makes the establishment Of banks
at convenient points necessary. This
movement follows, and is q part OF the
influx OF farmers and the building up Of
the small towns more rapidly than the
big cities have grown In the past II all
means q different sort OF a demand for
money and sharper competition in buai-
ness. Quite possibly the rates OF inter
est may be cut in upon and the profits
Of banks made a little less than when
the big institutions handled il all
Outlook Seems Promising.
The outlook for the coming trade sea-
son in the South IS declared by the bank
ers to promise we'll. The farmers, the
timber interests and the manufacturers
are hopeful and are extending their oper-
ations Rates for money are low and the
banks are doing all they can to encourage
greater development.
In the cities, slxyscrapers are taking the
place Of the old-fashioned brick build
ings and the appearance Of the streets
is being transformed. It is picture OF
growth wherever one goes, and this is as
marked in the small towns as In the
cities While there is perhaps not ex-
actly the vim and push that has marked
the growth OF new Western towns, it is
so much in excess of the South's former
lasitude in business affairs as TO amount
practically TO regeneration. and it is as
pleasing as It is surprising to the older
generation. In all this the banks are
taking a prominent part, and their prog
ress Is as marked as that OF any business
interests. Their deposits are growing
with the country, and the prospect was
never brighter than now for good busi-
ness future
One Banker More Liberal.
A prominent banker Of Mobile takes a
broader view OF the situation than some
OF his compeers. In a recent interview
he Is reported 10 have said;
I'VE are finding that the next step is
20 be the establishment OF small banks in
the country towns said one Of the lead
ing bankers here to-day: Already are
being organized little banks at mere cross
roads, and they are taking up great
deal OF local business.
ITO be sure. they have only a limited
field yet, because the farming sections
are undsveloped; but they are growing a;
a rate that means the eventual filing OF
the field Just now there is a strong
demand for money, and the financing the
crops calls for a great deal Of capital
for the country sections. The city banks
are taking q conservative course and are
holding down the loan condition so far
as possible,
bankers Feel Restless.
TT Is a fact that there is a feeling OF
unrest among the bankers and some dis
position toward caution that was not
present year ago. This does not take
the form of alarm, but merely conserva-
tism that there may be no overexpansion.
The Northern capital and population COM
ing into the South is waking up the bust
ness interests. and there are in progress
developments that would have taken
years to have brought about he'd there
been no immigration.
Trade interests are thus Influenced, and
there IS a better feeling and greater ac-
tivity than the South has seen for years
IN every Southern town Is going on q
building movement and demand for oapi-
tal with which 10 extend city properties
The laying out OF additions and the ex-
tension OF the truck farming industry add
10 the demand for loans. and we have
been finding the pull on our funds strong
IN consequence"
Thinks Industry Best.
IF you want my opinion said a mem