The Mathews journal. (Mathews C.H. [Court House]) 1903-1937, 1912-03-21
STATE BANKS IN
a FINE CONDITION
RICH NO ND VA Specj

R G H NJ O ND. VA Special
Declaring that the State banks in
Virginia are in better condition than
ever before in their history. Charles
c. Barksdale, chief examiner of
banks, yesterday submitted his annual
report to the State Corporation Com
mission. Mr.. Barksdale shows that
there are 247 banks in active opera
ton and that during the last year
there was just one failure, that of
the Augsburg Bank. at Rural Retreat.
Because of the rigid examination MI
Barksdale believes that the rights of
depositors are more efficiently safe
guarded than ever. that the officers
are giving closer attention TO business
and that everything is in correct or
der In all the institutions. The exam
nations are made at such time when
least suspected. and 1t has happened
completed another examiner has ap-
peared in less than ten days to take
another squint at the books.
Among the recommendations which
Mr.. Barksdale makes for the better
ment of the existing laws. and for
the uniform conduct of all the banks,
are these:
The enactment of a statute requir-
ing all banks to maintain an adequate
reserve. The present law is silent on
this point.
An amendment to section 1164 of
the Code, providing that the total liza
bilities of any corporation or person
to any bank shall not exceed rs per
centum of its capital and surplus, ex-
Guiding, in computing this 25 per
centum, bills of exchange drawn in
good faith against actual existing
values, and also excluding paper Sc
cured by warehouse receipts, the &C
tual market value of such stored pro-
ducts being 25 per centum in excess
of the amount loaned. Section 1854
as 1t now stands. limits one persons
or concerns liability to any bank to
20 per centum of the capital and sur
plus, exclusive of bills of exchange
and Commercial or business paper, -
but permits this rs per centum to be
exceeded without limit upon the adop-
jority of the board. The present stat
ute, in my opinion, is far too lax, and
places no restriction whatsoever upon
the board of directors in the matter
of excessive loans
An amendment to section 1854 to
prohibit banks from loaning money
upon the collateral security OF their
own capital stock. There Is such q
provision in the national banking act
and 1t should, in my opinion. be in
corporated into the Virginia banking
law.
The enactment OF a statute provid
ing that any bank desiring to organ.
lie shall, before commencing business
/ procure from the Corporation Com
| mission a certificate authorizing 1t Il
do so; requiring that q thorough ex
animation shall be made into condi
| lions, and the character OF the per
sons desiring to organize, and an
| thoriglng the Corporation Commission
| to refuse to Issue such certificate
| should the character of the person.
| be shown to be such that. In the judg
ment OF the commission, they are no
proper persons to engage in such
business. or should It be clear tina
rant the establishment OF another banl
in that locality. Under the presen
banking laws, II this once discover
that a bank has been most recklessl,
operated, and the commission applied
to court for a receiver. the sam,
other charter and begin business
| again.
An amendment to section ITO O.
the Code. investing the Corporation
Commission with power, in Its discre
| ton. to make public such information
concerning any bank or banks as sale
commission may determine would pro
statute forbids any officer or employ,
OF the State from making any infor
nation relative to banks public, undel
any conditions, save to such officer
and employees OF the State az may hev,
occasion and authority to lnspect tn,
records containing the Information II
the performance OF their duty.
Code, which at present requires direc
tors to make. or cause to be made. 81
examination "of the moneys OF thu
bank, and settlemoat e be made o.