The Birmingham age-herald., 1913-10-24
Will Mean ReadjDtment of
Practically the Entire
Banking System
NO PRECEDENTS TO
GUIDE THE WORKERS
Though Government at Washington Is
Supreme 1t Is the Bankers Who
Must Put Into Effect the
New Provisions
ny HOLLAND


New York. October 2S.-(Special0
There is to be no procrastination on the
part of American bankers in the diff
cult labor of adjusting the banks to
whatever banking system may be formu-
lated by Congress into law. Already in
this city a committee of highly quail
fed and expert bankers, thorough masters
of both the technique and of the under
Tying principles upon which successful
banking rests, are occupied day after day
in working out an available method by
which readjustment can be secured with
the least friction possible and the small
est amount of inconvenience. OF course.
these experts cannot go very far at pres
ent. They do not know what the bill in
its final and accepted form will be. They
do know, however, that a considerable
portion of it is sure to be embodied in a
new law and it is upon these established
features of the measure that the experts
are now working.
The work is all the more difficult be-
cause there are practically no prece-
dents. They cannot go back to the days
when, years after slow beginnings. there
were established a good many state
banks. These institutions were chartered,
one after another, and in their organiza-
ton and growth, nothing is to be found
which would be of any avail to the ex-
perts who are anxious to show the coun-
try as soon as possible after the new
banking and currency law goes upon
the statute book how the present Amer
lean national banking system can aban-
Don the administrative methods which
have characterized it since the national
barking law was enacted and adopt new
one
Much of this work of instruction will
devolve upon the clearing house asso-
Citations of the United States. For while
a new system, whatever it may prove TO
be, would not materially alter the char
acteristic features of the clearing houses,
which are the making of daily exchanges
and the payment of balances In cash,
nevertheless the individual members of
the clearing house associations will be
radically affected in their administration
by the new law.
1T Is, III Iact, lIeiiiDtfS VI Tie view
York Clearing House association who
have undertaken, as is understood, by
means of a highly qualified committee,
to work out plan of readjustment.
This work probably will be carried on in
collaboration with the clearing house
associations in other cities.
After Readjustment
The creation in civil war days of the
rational banking system and che grad
ual acceptance of it by so many Amer
lean banks which had been state char
tered, will furnish no precedent for the
committees that are now engaged in at
to work out convenient plan
for readjustInent The national banking
J, vsteln was slowly accepted. There were
>&y 60 banks in 1868 to obtain national
= arters, and their combined capital was
far less than the capital of many banks
at the present time--only 100000. They
had issued of the new currency, provided
for in the new banking law, only $4,000 900.
In the same year there We're 10 times
as many state banks as national banks.
Their combined capital was S400,0 600
and their circulating notes nearly $20O,000,
GOO. Gradually one after another of the
state banks reinquished their charters
and took out national bank charters. But
there was really no readjustment in the
sense in which that term is employed
when describing the transition to make