The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1910-01-15
APPROVE TIE nAN11 BILL.

s IMPROVE THE BANK BILL.
Bank reform is second only to tax
.eform in the issues before the AS
emily. Indeed, it is doubtful wheth-
y even the repair of our patchwork
ix-code is more needed by the peo-
lie. more required for the honor of
he State. more essential for the safe
onduct of everyday business, than
ne complete revolution OF our dis
graceful banking laws.
The emergency of the situation
would of itself be ample justification
or the bill introduced by Messrs.
Ningo. Stebbins and Noting In one
alambeg. and Senator'S Elan and Hol-
and in the other. As tile laws stand
,-day. bank regulation in Virginia
Sists in name only. Our estate banks
luld s3o,oOo,0o0 of individual funds.
;,lt they are subject to less regulation
han limos any form of business in
tic state. "A state bank with half
million of deposits is not required
o keep any definite reserve to meet
he demands of depositors. 1t may
invest every dollar of capital, surplus
md unused deposits in any sort OF
Ienture. 1t mny loan any sum to any
Borrower, other than a bank official.
may accept security that is not
worth the paper it is written on. In
word, the honesty of the bank Off :
ials is the only guarantee the de-
,ositor has that his funds may not
&c recltlessly risked and squandercd.
These are some of the evils which
lie proposed bill aims to correct. That
he bill will correct them and Will
ully safeguard the interest Of the
cpositors. practically every clause of
he bill guarantees. The experience
{ other states, the Judgment of prac-
cal bankers, and the particular prob
ms OF banking in this State have all
cen considered in the framing OF this
ieasure.
TO say nothing OF its many other
,mmendable features, this bill pro
ides tile three great essentials o!
.afe banking. 1t assures frcquen
Samination by competent men; IL
Units the mount of loans TO be mad
een1y one: IT ~prescribes a fixed reserve
s5r every state bank.
FIN establishing a bureau of bank
liz, instead of providing for specia
Examination, the bill follows that sys
Pm which the experience of Tia
nited states and Of the leading com
,lercial States has found indispensa
sc. Such a system, and such a on,
ialy. assures inspection above suspi'
don and examination above fraud. II
he sam way, the loan feature Of the
Ill is admirable. BY providing that
Is bank shall loan more than 10 per
LINT of its capital and surplus to any.
tes.rson or firm, except with the con-
INT OF the barking commissioner
otter a Vote of.%the directors. II. Will
event large loans 10 favored indi-
t%,duals. and win put an end to the
lid scandals that ruined hundreds
,shen one mans security proved
Iporthless. So CRYING is the need for
usislation on this point that we feel
crlincd TO urge provisions more strin-
INT than those now proposed. The
honnecticut Law. which allows only
totiat 10 per cent. loan to any inti-
pIdual. is, after All The safest and
,arcst law.
hr ~ #r..H--.- a.H.. "
arThe third important feature of Tue
III. requiring every bank 10 main
In a 15 per cent. reserve, must appeal
every thinking man. 1t will in
ysre TO every deposition ample funds
II immediate use and viii prevent
timely runs that wreck many a
went bank. We trust. however. that
~japproving this feature of the bill.
- Assembly Will stipulate the classes
banks in which the reserve funds
other banks may be kept. In the
'ersre OF some such provision. the
OF Other solvent bankss for the
Ikeeping of reserves might result
.;Sthe reserye-cxchangSe system. which
muye,practically no protection to the
Waositor. In otltpr words, unless the
DIX which may keep another banks
tht,rve is carefuliy Guarded. IL may
satsp It's reserve With the first bank
Pd square
stBut these arc minor matters. not af-
Manlting' the real and permanent, value
blpthe proposed measure We believe
y they can be modified, in the fu-
daie, as experience shall dictate. Tie
R~esilnportant thing now is to make
bill . law
IS yet there appears only ono OBJ
Gle in the way Of the bill. This ia
inclination on the part Of some
islators to make tho banking hui
Y a part Of the Insurance Depart,
mt. We regard this as a danger.
suggestion. We do not seriousl.
PAX that placing the banking bust
- under Tile Insurance Commission