Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1914-12-29
BUSINESS CRISIS OF
1014LESS HURTFUL
THAN In '9S AND 'O7
Comptroller Williams Tells
Of Improved Methods.
Denounces Loose Banking
Methods.

WASHINGTON, Dec. 29.-Comptroller
OF the Currency John SHELTON Williams,
in his annual report, made public today,
draws an interesting comparison between
the financial crises Of 1914 and 1893 and
1907. showing how we'll the latest emer-
gency was handled.
For the 70 months ended October 81.
1914, he says 26 national banks, with
aggregate capital stock Of S2,5lO,OOO, failed
or suspended payment The liabilities
we're St417,4O In the corresponding pc
Rod of 1928, 1853 national banks sus-
pended. with liabilities of $s3,oi2,3F. In
the six-month period, October 1, 1907 to
April 1, 1908, there were % failures, with
liabilities of 52,AS,s7s. He comments:
In the crisis Of 1914 unlike the panics
OF 1893 and 1907. there was no sus-
pension of currency payments on the
part OF the banks Of this country,
either in the large cities or in the
smaller towns. In the panics of 1898
and 1907 in addition to clearing house
checks, many artificial methods of
supplying a temporary currency were
resorted to, while actual currency
commanded a premium of from per
cent. to per cent.
In 1914 the banks of the country
were enabled, as a result of the in
slant and active cooperation of the
Treasury Department, and through
the operations of the act of May 30.
1908, as amended by the Federal re-
serve act. to supply actual currency,
even during the period of greatest
stringency, to their customers and
49, n.
and in response to requests for ship
ments.
Mr. Williams asks that legislation be
nut on the statute books giving the Comp
troller power to remove and discipline
guilty bank directors. He says:
Among the many abuses and viola
tlons with which the Department has
to contend are excessive loans. over
drafts. loose and unbusinessliSe
methods of accounting, excessive bor-
rowing by the banks, investment of
the banks funds in securities not
authorized by law. charging of
usurious rates of interest, unlawful
loans on real estate, excessive loans
TO officers, clerks and employees of the
bank employing them, loans to banks
officers or employees and others
through 'dummies"; leaning money
directly or indirectly upon the banks
own stock, transaction of brokerage or
executive officers, commissions thus
collected being sometimes appropriated
personally by the officers and some
times going directly or indirectly to
the banks; false statements of direc-
tors as to stock ownership and fall
ure or refusal to charge off bad debts
and other ascertalned losses.
Williams recommended that the bylaws
of national banks be made uniform, so
that directors meetings be held regularly
and more often. 1.-THE duties of officers
are frequently not properly defined," he
declared, land In many cases meetings OF
directors are rarely held"
Among other recommendations was one
that the law be changed so that officers
of individual national banks will not be
required personally to sign national bank
currency.
An amendment to the law giving to the
Comptroller of the Currency. with the ap-
poval Of the Secretary OF the Treasury,
the power to require the removal OF any
director or directors or OF any officers
of a bank guilty of a violation of any
of the more important provisions of the
national bank act, and to direct that
suit be brought is recommended by the
Comptroller.
The Comptroller said the total resources
OF the S,765 banks in the United States
on June 30. 1914, were s26. 1895, ,03096, with
liabilities of Sls.6l7 7S2. .s7SOl.
Total cash in vaults OF the 1880 national
banks amounted to s902. $50 on Sep
tsmber 12. 1914. while they held gold coin
OF $l556 $50
The United States bonded debt in
creased from 1866, ,s23. 800 on October 81,
1913, to Ss6S, ,s25,650 on the same date in
1914
That banking is one of the most proft-
able businesses in the country is shown
by the average dividend rate OF national
banks Of 1l.S9 per cent. Net earnings
of national banks for the fiscal year
amounted to $l4s, ITO and the dividends
aggregated sl2l. .147, ,O96,
The largest failure during the year
was the First-second National, OF Pitts
burgh
The banking power of the United
States. Mr.. Willie ms estimated, amounts
10 $2i,s40, ,O91, ,112. Individual deposits ag-
gregated tls517, ,T52,s79. Deposits in saw
ings banks were 1885. .59l ,si9. the average
deposit being S44as s6.