Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1914-09-09
Banking Laws Of
State Wholly Inadequate
Of State Hall Says Banking Board Is {
Of Proper Legislation.

An important item in the biennial
report of Secretary Of State Hall,
which has been filed with the Cover
nor, is that which deals with the
state banking board. Referring to
this question Mr.. Hall says:
Zone of the most important official
boards of the state government, Is
the state banking, the membership OF
which consists of the governor, secre-
tary of state and attorney general,
and ex-officio, the president and sec
rotary of the North Dakota Bankers
association.
Laws Inadequate.
"In my opinion, the banking laws in
effect at the present time are almost
wholly inadequate, obsolete as to ef-
fective control under present com
mercial conditions and should be re-
pealed and a new and up-to-date bank
ing law enacted.
Under the present law, the bank
ing board finds itself without any of
the real authority to control and reg
ulate the institutions which the law
presumably was to confer.
"Band Spawners."
"NOrth Dakota, as well as other
states, where banking laws are lax
and of no real effect, has a class Of
men who might we'll be termed bank
spawners, but who cut of charity are
known as promoters and %financiers.
Their general plan of operation is to
find a likely townsite out along some
new railway extension and then en-
list the services of an apt promoter
whose plan would be to enlist several
men of local prominence whose van
ity may be pleased to figure as bank
directors and officers. Subscriptions
to capital stock are easily secured
and the new bank opened for bust
ness, and shortly after, when the fur
niture and fixtures, the safe or vault,
is paid for the promoter quietly sells
his holding Of stock and often leaves
the bank to sink or swim as it may.
In many cases there is no real need
of a bank in the town and perhaps
there were already one or more es-
tablished and of sufficient strength to
care for all legitimate business Of
fered in which case the new bank
would weaken those already in the
town without any chance to become
strong itself. Local men interested
might be men of no experience or ap-
tituda for banking and are soon left
holding the bag while the promoter
has disposed of his stock, collected
his commissions and hied himself to
new fields of endeavor, where like op.
eratons are performed.
Nth Adopt Resolution.
ut having come to the knowledge
of the banking board that these on
ditions existed in this state and find
ing themselves practically powerless
to stop it, the board took upon them
selves the responsibility of adopting
the following resolution:
Whereas, This board is of the
opinion that it is against the best in
terests of the people of the state Of
North Dakota or of any community
within the state to grant charters for
banking corporations in places
where the population and business
are insufficient to warrant establish.
ment of a bank, or where the bank
ing business is already sufficiently
represented, and
Whereas, We believe that it will
assist in the Supbuilding of safe and
conservative banking conditions by
preventing the organization of banks
when demand or necessity therefor is
not apparent, and
"Whereas, Further, the banking