Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1911-01-17
Recommendations Are Laid Be-
fore the National None.
tary Commission.
CENTRAL ORGANIZATION
IS NOT
Entire Country Is TO Be Divided
Into Fifteen Dis.
tricts.

WASHINGTON, Jan. l~7.-Senator
Nelson w. Aldrich's long-awaited.
plan for the revision of the national
banking legislation as he himself
calls it, wal made public today. 1t
does not contemplate the establish
ment of a central bank. It is so far
from what most people have expected
Mr.. Aldrich to propose that 10 those
who have not been in his confidence 1t
may come as a notable surprise.
The plan was submitted today to the
National Monetary Commission at a
meeting called for the purpose.
Far from recommending the insti-
tuition Of a central bank, Mr.. Aldrich
expressly disclaims belief in 1t as CAL
eGlated to meet the needs of the stu
ation He uses the term but once,
IN his letter of transmittal.
Urges Reserve Association.
MIR. Aldrich proposes the establish
inent of the Reserve Association of
America" representing what might be
called a federation of local associations
formed by national banks.
SO well knit is the scheme proposed
that 1t is difficult to state briefly the
provisions OF the plan, but these seem
10 be the essentials:
At bottom, local organizations OF rep
resentatiVes of banks, formed by not
less than ten banks each, each bank
holding stock IN the association in pro-
portion 10 its capital.
Directors c.~cted by these to the
board Of 'LrAnch" associations, one
branch for each OF fifteen financial dis
tricts into which the United States
would be divided. Each branch"
board would include a certain propor-
tlon of men not bankers, but repre-
senttng industrial, agricultural, COM
hnercial n other interests.
''Branches" to BE Represented.
The branches in turn would elect
10 he reserve association proper direc-
tors, forty-fve in all, among whom
must also be a proportion of men rep
%fesenting interests other han banks.
There would be also six ex-oficio
members OF this board. namely, the
secretary of the treasury, the secre-
Iary of and labor, the comp
troller of the currency and the gov
erncr and two deputy governors of the
association.
The governor and deputy governors
Of the association would be appointed
by the President of the United States
and be removable by him for cause.
The association would be the prin-
cipal fiscal agent and depository of the
government, would fix from time to
time the rate of exchange or discount,
and eventually It's notes would replace
those of national banks. Prime COM
uaArAfAl ~ n aet,- z~. Atzl
banks through the local associations
and branches, as we'll as bonds of the
government, could be used as q basis
for currency issue.
Two New Glasses of Banks.
The plan contemplates also two new
classes of national banks, OF depart
ments of banks, to receive savings and
make loans upon real estate, and also
to be in effect national trust COM
paIies. National banks would be per-
United to form branches only in their
WI immediate communities, and they
could also be organized for business In
foreign countries.
Charter for Fifty Years.
1t is proposed to charter the Reserve
Association of America, which win be
the principal fiscal agent of the gov
eminent of the United States. The
authorized capital OF the Reserve AS
ISOLATION shall be approximately $780,
900, 900. Thu length Of its charter shall
be fifty years, The head office of the
association shall be in Washington,
d. CO.
The country shall be divided into IF
teen districts, and a branch If the Re
serve Association shall be located in
each district. The Reserve Association
and its branches shall be exempt from
state and local taxation. except in re-
spect 10 taxes upon real estate owned
by it.
Shares of the capital stock of the
Reserve Association will not be trans
ferahle, and under no circumstances
may they be owned by corporation
other han the subscribing national
bank, 0 by any Individual. nor may
they be owned by any national bank
in any other amount than In the pro-
portion here provided.