Evening star., 1915-02-04
LOCAL BANKERS NOT
OFFICIALLY INFORMED
No Copies of Controllers Ruling
on Overdrafts Received
r Here.
Bankers Comment Unfavorable.
Washington Railway Common
Stock and Gas Bonds Higher.
BY 1. A. FLEMING.

INQUIRIES at number of local ma
tional banks indicates that copies OF
:hc recent order of the controller OF
rhc currency regarding overdrafts
While published in the press of Other
cities and freely commented upon, have
,sot been sent 10 the Washington mem
hers of the federal reserve system
Hence no need for action one way or
The other in this city.
Elsewhere and here the comment on
the order is strongly opposed to any
hard and fast ruling of this KIND
Bankers have always understood that
the overdraft was thing to be avoid
ed and have taken action toward ma h
.ng it unpopular. except in exceptional
cases where the discretion of the presi-
dent or other officer of an institution
understanding existing conditions ana
that the account was perfectly Sood.
lave ordered payment of the check or
checks
Numerous cases have been cited where
delays in the mails, unaVoidanle, nav {
prevented the arrival OF funds IN trahsi''
against which drafts had been dra~n;
which if dishonored would have caused
much inconvenience. delay and perhaps
serious legal complications. Informa-
tiou of remittanceS is frequently recei'eu
by wire long before the actual 1unus. IL
IS pointed out by bankers An unalteTa-
ilc rule against overdrafts would change
thc business methods of the banking
community.
New York bankers, it is understood,
have very generally refused to take the
action asked for by the controlier
one OF the largest national banks IN
lhe District with deposits around the
seven-mill on-dollar mark, showed over
drafts this morning OF from l cent to
oil fntl nf loss SOD
all perfectly sure of being paid up
The District Bankers Association is
now planning for separate clearing
house for the purpose OF clearing ois-
hundreds made every day, checks iar
which there are mot sufficient funds.
no funds" etc. etc, but the bankers
claim the right to discriminate IN re-
fusals to pay in their own interest.
Regarding overdrafts this is what
-'Pratt's Digest of National Banking
Laws" says: And a bank president has
no right to permit overdrafts. when he
does not believe, and has no reason
able grounds to believe, that the
moneys can be repaid; and II coupled
with such wrongful act. the proof es-
tablishes that he intended by the trans
action to injure and defraud the bank,
the wrongful act becomes crime.
Coffin agt. United States, l62 U. 81
664). But the mere fact of the pay
ment by the officers of national bank
Of a check which creates an overdraft
does not necessarily constitute fraud
ulent misapplication of the funds of
Fed Rep. so4: United States aEt Stein
man. 17e Fed Rep. s13)."
obviates Difficulty.
Under the constitution of the Wash
.ngton Clearing House Association
only national banks may become mem
pers, but the facilities of daily clear
ings are extended through business
arrangement with some member bank
The bylaws provide that the associa.
ton shal examine the conditions or
house privileges through member
banks
because of the fact that the associa-
ton has not the services OF an expert
aank examiner, as intended. the con-
roller of the currency has been asked
% furnish a statement of the condt-
lion of banks that may hereafter make
application and has consented to make
report on receiving request from the
applicant-,.-
n looks very much as il this action
was q preparatory movement IN line
with proposed admission into the
clearing house association or othef
than national banks The trust com
tors and many of the savings banks
have large resources.
Local Securities.
During the last few days. since tho
announcement that the Washington Gas
Company had disposed Of it's entire issue
of $500. 900 per cent bonds, this issue
mas showed daily Increase in price on
the Washington Stock Exchange touch
ing the high this afternoon when 1t sold
at lO4 90 i04S or IS better than the
average price OF the bond issue Rail-
way As were steady at 80h, slight re-
cession Riggs Realty 5s. longtime ma
turity. sold at 1o1. and Potomac Con-
solidated 5s at 99ss.
The strength In Washington Railway
and Electric common stock continues,
and a new high for the current year
was made when sales at SSE, nifty
shares in two lots. were recorded. The
closing bid was SSt. and no stock was
offered under 95. Washington Gas was
slightly easier at ~ to 74%- Business
IN the aggregate was better than for
some time. 1t is evident that the time
has come when. some of the minimum
prices may be removed.
Treasury Statement.
Treasury. disbursements for Febru-
ary exceeded the receipts by s1o1.599.
increasing the excess disbursements
for the fiscal year to that date to $780,
ths,bZ3, as compared WIN SSV,Soo,J0b
for the last fiscal year to the corre-
spending date.
Georgetown Gas Dividend.
Directors Of the Georgetown Gas
Company have declared a quarterly
dividend Of s1.25 a share. payable Feb
ruary Is. to shareholders of record
February 10. 1t is probable that the
dividend on the stock OF the corpora
tion held by the Washington Gas Com
pany Will be held in escrow pending de-
termination of cases now in court.
Financial Notes.
Overdrsfts in the District of Column
b,a. including those of every banking
Institution, totaled Si52 October 81 last
sad s1s.eG7 December 81.
In North Carolina overdrafts totaled
s352.so0 December 81: in West Vir-
ginia. si51.2s4: Virginia, $1ss.747:
Texas. S1.7sl.ss4. the largest in any one
state: s3ec.s0s In New York state.
q .o72. 900 in Illinois, S553.5s3 in Georgia.
$50, 3,074 IN Louisiana. $475,00o in Ohio.
s-2s,s3f in Missouri and $4,000 in
Arkansas-
II is evident that the practice needs
D. ming down rather than total elimi-
IarIOn.
'-D.a1ncrcial failures for January were
SOL manufacturing. 2.1s4 trade con-
'-rus and 1l3 agents. etc. total of