The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-03-25
THE VAN TUYL BANKING PLAN.
A savings Bank On,cer Discusses Some
nj ire HrenoseN PrONlslNns.


To THE EDITOR or THE SUN--Sir: The
Van Tuyi banking law ARTICLE q, Saw
ings BanksD contains a provision In sec
ton 1853 which should not be passed over
as of minor importance or ss one t....s :.
In error may bc easily corrected here
after
This provision provides for handing
over to the Superintendent Of Banks the
right to dictate estimates OF market values
40 far as savings banks are concerned OF
all their stock investments.
Some of the Immediate effects OF such
a law would he to cut out from savings
bank reports nearly cne-half OF their
actual (amortized or Investment value)
surplus while its outcome In Its general
effects liz difiicut TO estimate.
Such a law in connection with another
provision contained in Article OF the
proposed revision, which extends the
limit OF surplus while II would enable
some savings banks with exceptionally
large accumulations Of surplus to delay
further an extra dividend TO depositors
would have an adverse effect upon . large
proportion of the savings banks In the
State which have fulfilled the law by di-
viding all net earnings among depositors,
'rescrving such amount AS the trustees
may deem expedient as a surplus fund.
by a Misrepresentation OF actual surplus.
Considering that the banking law per-
nits the trust companies Of the state to
place a surplus In their reports derived
from the actual or amortzcd valuation
of their securities, the discrimination Is
not reasonable.
As most of tho savings banks have less
than 10 per cent. Of surplus figured on
so-callcd estimates Of market values, II
the proposed revision for forcing surplus
becomes a law many savings banks Will
evidently be prevented from paying de-
positors per cent. for a term of years,
which dividends they might pay under
the present law, and thus avoid accumu.
lating an unnecessarily large surplus.
The provision OF Article for So
called guarantee fund is nothing more or
less than calling the surplus by another
name and taking out of the hands OF
the trustees their prerogatlve under their
charters of reserving such amount as they
may deem expedlent at each interest pc
Rod for surplus and placing such privilege
In tho hands OF the Superintendent OF
Banks In accord with the estimate he
may fx upon the huctuating market
values.
Savings hanks under the present law
have been compelled to invest all avail
able funds over 10 per cent. OF their
deposits at prevailing prices for securities.
To make n law which would cut out these
Investment values. which are fully guar
anteed as to payment of interest and
principal by valuations OF 40 or 80 per
I'll. VI n,os .saseo 'ioperS au W u
$3.50. .a.u" al, vi ',, u
suos'.u.sns nuo,ua',ns 'a'ues Vi
even practical as correct report OF a
savings bank 10 hs submitted to the
Banking department.
.ne -" ~. VI, ~ 800,
sse .., -. , .,, w.. ~ " as
u,''p' ,,,t '' 20. o"s -. ~ ~.
banking Department inserts the arnortized
.n,.s..''", - t"o IS. su.u, ,
", 80. IN W ""'e" '"'"'' ou'P'"1
~ ,t, - ,,. ,,.,,,
NC ~, .,ss oauN seo.I us
s,o ,',e'''oi VI e'te' MINING Wy 'Hu
s1,p'us, "'e NO. W ans HI."rs VI "nHoI
.lnp.I t'iI.' o' nn"r'ers N'Isn ohce
nanu.u oNt. W VIZ uIS'atI"ii OF tne super
"a n'.'ns my pe .aslis Gna.'seu;
s.,Da ' ieN".eu .ii'N 'p,'H.''oiI' VI
.ius' 1"..oI III l'e 'i,one' H'aiNet sIA ot