The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-07-01
CITY BANK EXPANDING
INTO SOUTH AMERICA
Branches to BE Established at
Buenos Ayres and Rio
de JaneirO.
TRADE BUILDING IN VIEW
Agencies Also Planned in Chile
and Other Places Under
Reserve Act.

branches VIII he established by the
National City Bank In the Arg milne Re-
public at Buenos Ayres and In Brasil
at Rio de Janeiro as soon as the bank
officials can obtain the necessary permits
sion from the Federal Reserve Board.
The City Bank directors at meeting
yesterday authorized Frank A. vanderiip.
the president. to make application to the
Federal Reserve Board for permission
to establish the branches and the appli-
cation will be one CT the first pieces Of
new business to be laid before the ad-
illustrators OF the Federal reserve bank
ing system. The City Bank has thus
taken the lead in this new field OF foreign
work opened up by the Federal reserve
act.
Details have not been elaborated to
any such extent as to enable the bank
to furnish more than meagre information
at this time regarding It's new departure.
II. o. Bailey. formerly an Assistant Sec
rotary OF the Treasury. who has been
associated with the National City Bank
for some time. and James G. MARITIME.
who has been in the employ OF the bank
for seventeen years. during part OF
which period he represented 1t in Cuba,
are to sail at once for South america.
They will undertake there the prelimi-
narles of the establishment OF the pro-
posed branches and launching the Or
ganization which the city Bank con-
templates for the assistance of the trade
of the United States in South America,
both going and coming. Each branch
will start with force of about Ave men.
Ananc~ In rhlI~ PLANNED
! Establishment of branches is not all
| that Is in mind. MIR. Bailey and Mr.
Martine, after visiting Rio and Buenos
Ayres, will proceed to Valparaiso. where
an agency OF the National city Bank
may be opened. patterned some that after
| the agency which the bank has long had
| In London Similar agencies may be pro-
vided elsewhere, but at the moment APP
parently the plans do not include new
agencies outside OF South America.
This enterprise is "A direct outgrowth
of four years of exploratory effort and
/ inquiry conducted by the National City
| Bank in South America. At least four
men. one of whom was w Morgan Shus-
ter. who became well known as financial
adviser to Persia, have been engaged In
| these researches. which were first under
taken with view TO the organization
of Independent banks under the auspices
OF City Bank interests. The enactment
| OF the Federal reserve law, with its sane
ton for foreign branches. changed ma
terially the nature of the projects.
Manufacturers' Need Great.
For several years American manufac-
! lures and merchants have laid increasing
emphasis on the Importance and desir-
! ability OF trying to extend American
trade. with Sou,h America in particular.
! Great commercial conventions have been
held for the purpose OF promoting Ameri-
can commercial activities in foreign mar
kets, but it is the South American oppor-
tunity which has attracted most a,ten-
ton. In all this time II has been as
| serted again and again that what bust
ness In the United States needed in order
| TO expand its South American relations
was chiefly provision for banking facilI-
ties I'm these southern countries.
The aim OF the bank Is not merely to
set up branch banks. It is said. but 70
perfect an organization which will render
the greatest possible assistance to the
promotion OF prosperous and harmonious
relations between the United States and
South America. As an instance OF wha,
is meant Ii is pointed out that all banks
in the United States that desire to co.
operate IN the movement will be invited
to make use of the facilities OF the City
Banks branches and agencies for the
benefit of their own customers.
The capital OF the branch institutions
has not been fixed. but will depend largely
on how the Federal Reserve Board rules
regarding whether capital shall come from
the banks undivided profits, from sur
plus or other source.
The people of the two countries are en-
tirely friendly to the coming of the City
Bank and American banking influence, /,
was said last night by the bank officials
Banking In South America IL now prac.
Ill. H.. Ln A - IN...I
France and Spain. The attitude OF these
bankers has not been sounded.
Federal Reserve Provision.
The provision of the Federal reserve
act for foreign branches in part is as
follows:
Any national banking association
possessing a capital and surplus of
| $1,000 900 or more may file applica-
ton with the Federal Reserve Board,
upon such conditions and under such
regulations as may be prescribed by
the said board. for the purpose of Sc
curing authority to establish bi anches
in foreign countries or dependencies
| OF the United States and to act If
required to do so as fiscal agents OF
the United States.
In speaking of the plan last night Mr.
Vanderlip said
at Is our desire to render service I,
American business and service Is tn
word which | would like to stress in Thu
relation. or course we hope that the un
dertaking will he profitable. but we be
lieve that the principal profit which will
accrue TO us will be from a share in tn
great general expansion OF trade between
, the United states and South America
which can be developed
, "The organization which We seek I,
, build up Is intended to do all that
bank can do for exporters and importer
and a great deal more than we could un
dertake to do for purely domestic busl
nesg"