The Donaldsonville chief. [volume] (Donaldsonville, La.) 1871-current, 1914-07-04
HOW It WORKS ELSEWHERE.

tlUsH II HsulIhJ LLuLaallL
Operation and Effect of Guaranty Of
Bank Deposits Law in Kansas,
Texas and 0kiahona-Plan Al
together Successful.
That the law providing for the
guaranty of bank deposits is operat-
ing successfully in Kansas, Texas and
Oklahoma is shown by the report of
the special committee appointed by
the Louisiana general assembly to in
Festigate the workings of this mea-
sure in states which have adopted
It, as reproduced herewith from the
official journal of the senate, of date
June is:
To the President of the Senate and
Speaker of the House Of Repre-
sentatiVes:
We, your committee, to whom was
referred the duty OF securing data
relative to the workings of the bank
guaranty OF deposits in the various
states in which such law is operat-
ing, and also all other facts both in
favor of and against the proposition,
Deg to make this our report, submit
ting herewith letters from the bank
ing departments of other states, facts,
figures and other data secured and
collected for the presentation of the
subject.
We wish to say that all that has
been submitted to this committee,
and as far as our information OBJ
talns, commands in every instance a
firm belief and conviction that such
a law now in operation in the states
of Texas, Kansas, Nebraska and Ok
Lahoma is d perfect success and prov
ing a very satisfying safeguard to de-
positors, and in no wise Objectionable
TO the banks operating under its pro-
visions.
We would further call attention to
the fact that in no instance has any
adverse fact been submitted, although
ample opportunity and special call
was made for facts both for and
against such a law.
In view Of this fact your committee
begs to submit this report and asks
to be discharged
A. f. BARROW,
f. C. CLAIBORNE,
CHARLES E. sCHWING.
Topeka, Kans, May IS. 1914.
Hon. A F. Barrow, Mr.. F. C. Clai-
borne and Mr.. Charles E.
Schwing, House of Representa-
tives, Baton Rouge, La.
Gentlemen.-I have your letter of
the 22nd, asking for information with
regard to the operation and effect of
state, for the use Of your committee
IN formulating a similar law.
For your Information I enclose you
under separate cover pamphlet con
tanning the banking law and also the
guaranty law, governing the state
|. banks Of this stassa. The guaranty
law was passed in 1909, and since it
| has been in operation the guaranty
fund has been drawn upon to pay but
one loss, amounting to about SIS, 900.
| she loss has been kept down to this
small amount through the fact that
We have, as | believe you will agree
when you read our law, a most eX-
eellent banking law, which clothes
tie administering officer with a
great deal of power and enables
hlm, If properly administered, to
Keep the banks in good condition.
The amount upon deposit under the
aW wi the state treasurer is at
this time approximately SIZE, 800 in
cash, and s403, 900 IN bonds.
A guaranty law, to be successful,
must be preceded by a banking law
similar to ours providing for strict
supervision and should fix a salary
for the supervising officer and his
subordInates sufficiently large to en-
able the state to secure the services
OF competent and experienced men.
should say that the minimum sal
airy for an examiner should be $500,
tor you can not expect to secure
both caliber and experience for
smaller amount
The banks should be regularly ex-
amined not less than twice each year.
and II | We're to make any sugges-
ton to amend the law We have IN
this state, it would be to prohibit
the executive officers of our bank
ing institutions from borrowing money
from their, own banks under a pen
atty sufficiently severe to make it
effective. We find that the greatest
troubles in the banks of this state
are through official borrowing, ex-
cessfye' loans and the granting OF
oTer-drafts, and every banking law
should cover these propositions IN
practical and effective way. No
state should, in my Judgment, pass
guaranty law unless they have a
strong banking law that has been IN
force for several years, SO as to en-
able the supervising officers to get
the affairs of the several banks
thoroughly adjusted.
I should be pleased, of course, to
furnish your committee any addition
al information that you may desire.
upon request Very truly yours,
CHAs. Ne. SAWYER,
Bank mmissioner.
Austin, Texas, May ~, 1914,
Hon. A. f. Barrow, House Of Repre-
sentatives, Baton Rouge, La.
Dear Sir:-This department has re-
eeived from His Exce1lency, Governor
o B. Colquitt, your letter to him IN
der date of the 22d, requesting lnfor-
nation with reference to the state
bank guaranty law OF this state.
Replying to your request for 1nfor-
nation [ beg to state that this law
was passed and became effective In
this state Aug. 8, 1903 It's operation
SO far has been Avery decided sue