The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1914-02-23
BANK BILL COMES
. UP IN HOUSE TODAY
Montague Act Makes State Reg
ulations Conform to Fed
eral Statutes.
NEW BUREAU is CREATED
Commissioner of Banking Given
Power to Take Charge of
Insolvent Banks.
NEW BUREAU is CREATED

The Montague bank bill will be the
special order In the House Of Delegates
to-day. 1t enlargcs and specifics tho
powers and duties of the present office
OF state Bank Examiner, changing tho
name to the Bureau of Banking, and
the title of the Bank Examiner to Com
missioner of Banking. Tho bill Is n
codihcation of existing statutes on the
subject OF banking with number of
amendments and new sections, and was
stated by its patron, Mr.. Montague, of
Richmond. to have the approval Of the
Virginia Bankers Association. Mt.
Montague Haid that he had gone over
tho bill carefully with George Bryan.
attorney for that association. who APP
proved of its provisions. with certain
amendments The bill itself consists
or lis printed pages. Amendments Of
fered by the patron and by other mem
bers, already In the hands OF the clerk,
take up eleven printed pages. and af-
rect almost every section. Tho bill has
been favorably reported by the House
Committee on Insurance and Banking.
Creates New Bureau.
In lieu OF the old section 1I6e of tho
Code, rs amended by the act of 1910
providing that the State Corporation
Commission should cause and direct
examinations of banks at least once n
year, and for the appointment OF n
CHIEF bank examiner at salary of
$4,000 year. the Montague act creates
the Bureau OF Banking the principal
officer OF which Is to be known rs the
Commissioner Of Banking. whose salary
shall be $4,000 per year. The bureau Is
subject TO the supervision and control
OF the Corporation Commission, but Is
separately charged with the execution
OF all laws relating to banks and bank
ing.
Under the old law, the assistants and
clerks were named by the Corporation
Commission. The Montague bill pro-
vides that tho Commissioner of Bank
Ing may appoint from time to time such
assistants, clerks. examiners and steno-
graphers as he shall find necessary.
All OF the expenses of conducting the
Bureau of Banking. including the
salaries, are to be paid out of special
fund derived from n tax on State banks
and trust companies. This tax is set
apart TO the credit OF tho bureau, and
the balance does not revert to the State
at the end of the year.
The extensive provisions OF the bill
as TO the examination of banks, meth
DDS or bookkeeping, access to assets.
unsafe methods or violations OF bank
laws. treatment of worthless assets, in
corporation OF banks, savings banks
of directors, regulations as to invest
ments and ownership of real estate, re-
servo funds and provisions for insol-
vent banks and for the Commiss Toner
OF Banking taking charge OF such in
stitutions, arc stated to DO intended rs
nearly as possible to make the State
regulations conform to national bank
Ing laws. The system of oversight and
control Is modelled on that exercised
over national banks by the Comptroller
of tho Currency.
Treatment OF Insoiv~nt Banks.
The most striking change. following;
the Federal system. is in the admins
which. under the new BILL LIS vested
exclusively In the Commissioner OF
Banking. The Federal &C; provides
that the Comptroller OF the Currency
shall take charge of insolvent national
banks, the courts, Federal and State,
having no authority to appoint recelv-
ers. II is stated by friends OF the bill
that this has resulted In a reduction OF
expenses TO Il comparatively small frac-
tlon of that under the court receiver
ship system. In other words, according
to tho advocates of the bill. the assets
of the insolvent bank are paid to de-
positors and stockholders. rather than
to receivers, attorneys and court OIL
GERS.
The act regulates the establishment
of branch banks, and forbids chain
banking: it prohibits excessive loans to
q single borrower, and especially to Of
fccrs OF the bank, and carries other
provisions which the bankers believe
will materially advance the condition
of the banking business, and make
more secure the money Of deposltors.
A companion bill has been offered in
the Senate by Senator Saunders.