The Washington times., 1912-03-03

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Certain matters are to be considered
In making comparisons in the Stats
tics Of Washington banking institu-
tons between the responses to the
Comptroller's call of December s. 1911,
and those of February 20. 1912, other
than the natural changes in the season
of the year-the rush of holiday trade
and the quietness before the burst into
spring trade.
1t was a matter of interest as to
whether the deposits of the local
branches of the International Banking
Corpora ton, prior to absorption of the
business by the United States Trust
Company, were counted in the statis-
tics of Washington or those of the home
of the parent company. Some bankers
,, favored the latter idea, but inquiry at
Headquarters showed that the Inter-
nationals Washington business had been
credited to savings banks in making
up the statistics. This explains an
apparent loss Of ,1,62O,OOO in the COM
parative individuals of the savings
banks, when, as a matter of fact, there
| was but small actual loss, this in
| itself being rather remarkable because
OF the long period of steady gains
|
lost rather heavily, and four that gain
| ed in moderately large amounts.
Six trust companies reported TO the
Comptroller on the last call the Con-
tinental joining the list. The United
States Trust Company showed gain in
deposits of ;1,470,4O9. due practically to
the absorption of the business of the
International Banking Corporation. The
nnffr ri TRttg ina
heavily, $685., 2O7; National Savings and
4 Trust, $66,655, and the Union Trust, $685.
900. The Washington Loan and Trust
\ lost a small matter of $1,000.
! The net gain in individual deposits in
trust companies was 1854 ,0o3.
Further deductions may be drawn
from these figures. and anyone desir-
| ing to deduce is welcome to do so.
Comptroller Murray has found a new
| method of enforcing one of the most
important clauses of the national bank
| ing act, namely, that which prohibits
national banks from lending more than
| 10 per cent OF their capital and 10 per
cent of their surplus up to 30 per cent
| OF their capital 10 any one person or
| borrower
1t is a provision of the law. and as
| such is to be enforced. The Comp
| trolier has notified the fraternity of his
| intention to hereafter order four eX-
! aminatiOns annually of banks that re-
| fuse to obey this section of the law.
| Examinations are costly, depending on
| capital and surplus-probably an aver
| age. under the fee system, of 500 an
| examination in the cities and $50 I'm the
smaller towns to $3.50 to 500 for the
| large fiscal institutions. Doubling this
/ tax is likely to be effective in stop
ping this practice. Two examinations
| annually is the present custom.
| Moreover the Comptroller is about TO
| take strong hand against criticisms
, directed at him by reason of his nu-
meTous and insistent requests that di-
| rectors shall direct: that they shall
| ing discounted; that they shall have a
| look now and then at the paper and
securities in the bank. and shall at
| least spend an hour or two, II neces-
! sary, with the bank examiner when the
| latter is examining their banks or after
| tho examination. Cases are cited where
| failures have resulted from inattentio1
! to bank matters by directors, where
! forged paper and other irregularities
! have caused suspension that might
have been avoided by the attention of
| directors and examination occasionally
| Of paper, etc. Persistent appeals to
| feCtive. and should be pressed home,
even II they sometimes cause hysteria
! on the part of wives who should not
open their husbands mail
| Washington according to the banking
| fraternity. has too many banks now"
And yet 1t seems as II the deposits con-
| tinue to increase, whether another is
added or not. Wonder where the money
| comes from?
What will the money power" investi-
| CATION disclose?
Probably the fact that 'money is
power" That at certain times when it
| Is a question of policy and of safety
| that the great fiscal institutions under
| the guidance of capable pilots, fire.
| quently under the care of that Master
OF Finance" j. Pierpont Morgan. get
together and take whatever steps are
| necessary to stop panics, to check over:
speculation and force liquidation that is
| deemed necessary. That combinations
have been formed to finance great I'M
proVements in the interest OF the growth
| of trade and commerce.
! The inuuisitors will discover, IT they
| deIve deep enough, that bankers, acting
as a unit have bought thousands OF
| shares of stock to check panlcs ana 10
| bring back Wall Street. a necessity TO
| the welfare Of the nation, TO an even
| keel. and sold these same stocks at a
! big profit when the equilibrium has been
| restored.
No evidence will be discovered that
| the banks had anything 10 90 Will
| bringing on the panic of 1907, as so ire
quently charged, unless the liquidation
| of stocks in the necessary preparation
| for apparent trouble and Strengthening
of the sinews of war. may be looked
| upon as a movement in that dlrectlon'
| Any bank that goes through a panic
| without being obliged to call Tor help
\ must be piloted by men who can read
| the signs of the time, even from clear
| barometer. ,s,-
Men of this caliber become leaders
excite envy OF less successful.
| The investigation Will prooaply JUS
| close the fact that banks act in mar
! mony in refusing aid to propositions aq-
| VanCed by reckless operators, PROPOSE
! lions that do not look good ana TO alu-
| ing causes where there's nothing IN ~.
| Money in business Is not charltapIs
| proposition. 1t may also be discloseu
| that some bankers have acted In mar
! mony i'm great enterprises Where rlch
| harVests have been garnered. ,,
! So have private individuals ihcluu-
| ING members of the House and Senate
ANY investigation must disclose me
| truth of that maxim, as old as the
hills, money makes money. II may
! develop the fact that rich men nave
! taken long chances for the long
| green. but 1t has ever been the ma pit
Of men Of means, other than those VINO
gre too conservative, or who are SAT
| isded TO work for accumulation Dy tne