New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-02-04
House Currency Investigators
to Adopt Bryan Doctrine in
Proposing Reforms.
REGIONAL RESERVE GROUPS
Institutions Would Be Formed
Into Zones, as in Adrlcn
Scheme, and Those with
State Charters Would
Be Invited to Join.
IRON The Tribune Bureau

Washington. Feb. "A system when
will guarantee deposits in national oahks
"a doctrine originally propoundeo IN
rather vague terms by William j. Bryan
will be among the recommendations OF
the Glass subcommittee of the House
Ranking and Currency Committee, which
is investigating the subject OF currency
reform.
The Democrats are in substantial sc-
cord upon this feature of the report SUCH
A proposal will meet with immediate OPP
position from the banking interests anu
especially from state and private BANKS
The full details Of the plan for guarantee
ing denositors against loss have not been
worked out.
The tentative scheme Of the Democratic
members of the committee Is to INSTITUTE
a system OF regional reserve associations
crouping the banks Of the country IN
zones. somewhat as proposed In the
A,drich plan, but eliminating the great
central institution.
Each Zone a Banking Family.
Under such a plan the banks in a par
ticIlar zone would become great oank-
Ing family, responsible each TO the other'
and TO some central supervisory autnor-
nv exercised by the government
In addition. It is now proposed 10 make
all the banks IN particular regional re-
serve association liable for the loss 10
depositors which might occur at any one
institution. In other words, the Demo
Gratis intend that In the event or faiiure
depositors OF national bank shall look
first 70 the assets and the liability OF the
stockholders OF the unfortunate tnstitu-
ton. and then 10 the combined guarantee
fund of every bank In the regional re-
serve association affected.
If this plan is not finally adopted the
Democrats will recommend a SUBSTITUTE
scheme providing that every nationa'
hank embraced in the new monetary re"
form shall contribute to a general treas
ury fund a small insurance tax out OF
which will be paid all losses to depositors
in national banks. II is estimated by
members Of the committee that II an IN
surance tax Of only $500 Of ! per cent
on deposits Is paid into the Treasury 1t
will be sufficient 10 cover national BANK
failures
This latter plan would cause every ma
tional bank in the country 10 contribute
its mite toward the reimbursement OF de-
positors in a failed institution, no matter
in what zone il might be. Under the for
MGR plan the guarantee contribution
would be higher. naturally. as limited
number Of banks would become respon-
sible for the failures in their particular
zone.
State Banks Gould Come In.
The information that the Democrats OF
the Glass subcommittee are proceeding
along such lines will jar those banking
interests which have always opposed the
guarantee OF deposits. State banks. II is
pointed out. will lose deposits rapidly il
deposits in national banks are guaran-
teed
The House committee scheme is, there
fore. 10 invite state banks 10 become
mart OF the regional reserve associations
and these institutions probably would ma
il necessary TO accept the suggestion as
a matter Of self-protection.
The guarantee of deposits is radicai
depar,ure from existing banking methods'
but member Of the committee said TO-
dsv that this happened TO be the one
point upon which the Democrats OF the
committee have reached substantial