El Paso herald. (El Paso, Tex.) 1901-1931, 1914-09-29
URGES
NEW BANK BILL
Sends Message to Legisla-
ture Urging Passage Of
New State Bank Law.

Austin. Texas. Sept 29.-In supple
mental message transmitted 10 the
legislature today. governor Colqultt
outlined every possible phase Of his
proposed Central Bank OF Texas Dill
which is now under consideration IN
committee Of both branches OF the
me governor points out that the plan
is not only constitutional but that II IS
a safe investment for the school fund
That the bonds and securities OF the
permanent school fund are not now
earning over four and a half percent
while invested in the Bank OF IeNds
would guarantee a weld OF five percent
The governor seems TO have ABANDONED
the plan Of utilizing the S50,O00,OOO Of
the land notes belonging TO the scnool
funds. as he does not mention ii in mis-
message.
Governor Colquitt points out where
il is only necessary 10 utilize nearly
$4,000. 900 Of bonds now to the credit
OF the permanent school fund
Is to Utilize Gold Bonds
The plan for creating the Bank Of
} Texas declares the governor rs 10
utilize the ST, 500. 600 Of gold bonds now
, in the state treasury and owned by me
! state school fund as the basis Tor the
I state or the school funds subscription
3 to the capital stock Of the bank. the
; bank giving therefore bond certificates
. representing their value, these bond
. certificates being guaranteed by the
H bank itself and also by the state
The bond certificates are 10 uraH
E five percent interest and this interest
is 10 be paid 10 the state available
p school fund the bond certificates re
. naming a part OF the permanent school
Nearly s15.OOO.OOO Cash
3 According to the figures OF the gov
3 ernor. the Bank Of Texas would have
S14.450.000 in cash TO commence opera
The bill provides that state banks
Z shall invest five percent Of their capital
I in the Bank OF Texas and this would
Z give S1.70O 900. The State bank reserve
Z is S9,35O,00O; the State bank guarantee
fund which il is proposed to place n
: the bank is S1,s00.O00: the unused
treasury accounts are S6,000.000; state
. school funds balances S55O,0OO. and
z S250.000 accounts Of state departments
in course Of adjustment
Would Be State Banker.
Thus the Bank OF Texas. It IS shown.
. would be the banker for all state funds
that are now deposited in various bark
in< Institutions and kept In the state
tIeasury vaults.
tireIy possible that the Bank OF Texas
may Join the federal reserve system he
quotes section Is OF the federal reserve
act which, he says, would make such a
thing possible
that il the Bank OF Texas Joined the
regional bank system. the Bank OF Tex
as could take its S1S,00O.000 worth OF
bonds and deposit them with the led-
eral reserve agent and get Sl6,OOOOOO IN
federal reserve notes in emergencies or
so much thereof as is pointed out by the
law under normal conditions. which are
good for all dues in the United states
Would Have Abundant Capital
This further answers the question,
Where would the Bank of Texas get
! money to operate upOn2 The answer
/ is simple, and the supply Of currency
would be elastic and sufficient" With
Z 81 200. 900 OF bonds and Sl5,00O,OOO Of
Z money gathered together as here IN
q ted the nnfnrg out that
: the Bank Of Texas would easily nave
resources equivalent to S33.0O0.000."
The governor also strongly indicates
in his message that he may submit 9th
er matters OF Importance to the cOnsid-
| Grafton Of the lawmakers
He says on this point; Il have again
/ convened you in extra session for the
+ further consideration Of this subject
I and other important matters which may
/ be subsequently presented TO YOU Tor
I the protection Of the credit Of our peO-
/ pie and TO prevent the sale OF their
] products and property at sacrificing
prices TO enforce the payment Of debts"
Senate Begins Work.
{ With a quorum present today, the
senate proceeded to the transaction
/ of business. The per diem, carrying
/ $f5,U0O, and the contingent expense
! bill. carrying $4,000. were both passed
I finally under suspension Of the
I rules.
Senator AIcGreEor sent up a petition
{ signed BY over 100 citizens of Sugar
2 lana protesting against the EG OF
the Bank of Texas bill This prectpi-
tated a debate. Senators Collins and
AcNealus both protested against the
I reading Of the petition on the grounds
Z that il was an attack on the governor,
rather than a protest against the en-
actment OF the bank bill; the petition
was read
Urges Adjournment Wednesday.
Senator Terrell offered a concurrent
resolution that the legislature adjourn
sine die on September 80. but no action
was taken on the resolution Should
this resolution be adopted il would
7 kill the bank bill The governors mes
sage was transmitted today to the
{ senate
Collier Before Committee.
Before the house committee on
banks and banking today. commits
sioner of insurance and banking Col
lier occupied the attention OF the com
I mittee during the entire morning. and
. no was questioned relative to the pro-
! posed Bank OF Texas bill
Mr. Collier told the committee that
one Of the prime reasons for the es-