Evening star. [volume] (Washington, D.C.) 1854-1972, 1914-12-20

National bank examiners are TO oe
distributed so as to perform their du-
ties in the several federal reserve ois-
| tricts, with a resident head or the
| aminers in each of the twelve Clues
! where a federal reserve bank is 10
Gated, with the exception of dls'rice
No. 5. and in this case Washington.
| logical center of the entire district
has been chosen.
| By this plan, which J. Shelton VII
| liams, controller of the currency, mas
arranged for. an excellent opportunity
| is provided for the establishment of an
| Invaluable credit statistics bureau for
F, each district, and in like manner tor
the United States, gathered in the va
rious regional districts, and compiled
| by the chief examiners located in the
twelve important centers where fed
| eral reserve banks are located.
! 1t is possible by this arrangement for
! the federal reserve board to keep in
! the closest kind of touch with its
| regional institutions, and the member
| banks of the great system, and indi-
rectly be great aid to the member
| banks in the matter of granting dis
| counts. The record cannot be COM
plete because of the fact that state
| banks and trust compaiies have not
| in the reserve system, but so far as the
| 1000 or more national banks are con-
| cerned. the records would be COM
| plete, in time.
of a maker of 4 note back of it and
also the guarantee of the member bank
offering the document for rediscount,
SO that, apart from the credit records,
the regional bank is safe in it's redls-
counting operations, but it is a matter
of great value to member banks to have
the best credit ratings.
Washington bankers feel that the ex-
ception made in favor of this city, over
Richmond, as the headquarters of the
district examiners is but justice to the
capital.
District Bankers to Meet.
The District Bankers Association will
meet at the New Willard Hotel Tues
day evening to consider various mat
tiers and especially to act on the re-
port of the committee, of which Charles
]. Bell is chairman, on the proposed
uniform collateral note. There is much
difference of opinion on this subject
among bankers and divergence of op1n-
ion on the part of counsel. some clalm
that an agreement between the BANK
ers of the city, of this character, might
be an infraction of the Sherman law;
others hold that it would be legal.
Some very interesting questions are
likely to be brought up at the meeting.
especially as the question has been
generally considered by banking of11-
Gals.
Discounting of notes, as recommended
by the association some weeks ago.
has not been generally taken up by the
District banks; the uniform counter
check recommended is now IN quite
general use.
At least one bank in Washington m
~ a
stock certificates deposited as coilater-
al for loans, Immediately above the IN
dorsement of the owner. If the GER
tificate is. then lost or stolen II can
have no negotiable value, as 1t is trans
ferable only to the bank named on ITS
face. 1t is specific and destroys all
value to other than the bank.
1t means that each certificate mus.
be surrendered and a new one issued
in it's place when the loan Is taken up
err The transaction becomes a bit cum
bersome as to details. but in line with
'safety-frst' suggestions.
The law explicitly holds a bank re-
of collateral held by it. The extra
trouble of inserting the banks title on
each certificate insures the banker
against loss in the event Of theft or
loss Bankers are generally insured
by bonding of employees and they are
especially careful of collateral, but
some one must be trusted.
Reserve Rediscounts.
1t was generally expected that the
reduction of the discount rate of the
federal reserve few days ago
would cause a material increase in
the rediscounts of member banks,
but the statement of the twelve
regional banks showed an actual re-
duction of few hundred thousand
dollars during the last week.
'If the regional banks expect to do
their share of business said a local
banker, they must meet the lending
rates in New York city. Bankers
naturally will borrow in the cheapest
market. and 1t is nothing more than
business. Some think that it is within
the power of the federal reserve board
to make it obligatory on the part of
member banks to do their borrowing
entirely of the regional bank of which
they are a member. With short-time
money at 31ha4l2 per cent in New
York, bankers will not accept the
per cent rate now current in the Rich
mond regional institution and in other
reserve banks.
Il recognize that the entire system
is in the initial stage; that the supply
of strictly commercial paper is not
very large and that the reserve board
is feeling its way along.
THE federal reserve board has prob
lens to meet and l believe that it will
solve them. 1t has been a very useful
body in the country during the trying
period through which we are passing
and demonstrated its capabilities in
the control OF the foreign exchange
situation at Il ticklish period in our
foreign credit relations. and SO far has
made no rulings but which meet the
approval of the banking fraternity
Rockefeller Foundations Securities.
The Rockefeller Foundation in IA re-
cent report of it's security holdings
listed them as of an aggregate value
of $103, 100000.
The decline in the market from July
to the reopening of the exchange,
practically to the date of the last re-
port, made by the foundation last
week, shows a loss of value in the ag-
gregate of over S 100000, the value
of the securities being close to $780,
600, 900. When these securities were
transferred from the donor to the
foundation they were worth more than
500, OO0, 900.
The chief depreciation is in the bond
list, where it would be least expected.
That the stock list showed compare =
lively small loss was due, in large
part, to the fact that there were many
shares of subsidiaries of the Standard
OH group of stocks.