The Richmond Virginian. (Richmond, Va.) 1910-1920, 1915-10-10
HELPING INDIVIDUALS
MAKE SAFE INVESTMENT
Trust Companies Doing Praiseworthy
- =,
Work in This as Other
Lines.
BOND DEPARTMENTS
Nor Than Billion I'm Bonds For In
'sy.Incnt Arc in Hands of Trust
ComlsanieS-Greater stability Is Az
forded.


promotions with their pathetic de-
tails OF losses suffered by those OF
whom the old adage applies the fool
and his money are soon parted But
little publicity has been given to the
praise worthy work which ia being
done by the trust companies in this
city, and, In fact, throughout the
country. not only IN '1clpine individual
investors 10 make safe and profitJ ble
Investments. but likewise in admins
tering estates. or as executor and
trustee under will. where large pro
portions Of estates left by the makers
Of willis for their families consist Of
bonds and stocks. It Ia only within
recent years, and in response TO a
clearly defined demand. that trast
com panies in this city. as elsewhere.
have established sepaIate bond de
pArtments, managed by an expert In
bond values and with trained staff
of appraisers. statisticians and attor-
neys at their command.
Prior to 1900. practically all Of The
bonds. stocks and securities offered
the public by corporations, public
service organizations or municipal
ties, were financed and distributed
through private banking houses, Blu
with the enormous increase in the
volume Of such issues. now amounting
Ia an average of over s12a.0oo.oe ?
month, and because of the greater
protection. required for tse clients 9f
banks and trust cnmpa MES, II has
become necessary for trust companies
especially In the large cities TO organ
i've bond departments. A recent Of
fetal report of the Comptroller of thu
Currency at Washington. shows that
National Banks of the country alone
hold over one billion dollars worth Of
bonds for investment. other than gov
and State banks. however, hold much
larger amount OF bonds On june
30, last, tho 1856 trust com anies in
the United States reported among
their holdings s1.204 542,53S bonds
and stock investments ont OF aegre-
gate banking resources Of IS, 400, SO,
ais
The primary reason for which trust
companies organized separate bond
departments WIS 10 re able To hautftc
more SCIENTIFICALLY and tnteffigehtiy
the vast amount OF investments arts
ing out of the administration of all
kinds OF trusts. For example. the
trust companies now are custodians
Of over $4,000. 600. 900 worth OF cor
porate wealth, consisting mostly of
stocks and bonds and collateral Sc
curisies Of corporations for which they
act as trustee under mortgages exc
cuted to secure such obligations In
addition to this. they manage estates
and trusts conveyed by individuals
living and dead. amounting to an add :
tional $4,000. oo0.0 900. which IS con-
sentative estimate. Including their
$500, geo. 900 banking resources, the
trust companies are stewards of a
vast treasure valued at over thirty
five billion dollars. large proportion
of which consists OF bonds and stocks.
With such tremendous responsible
ties, 1t was both logical and necessary
for trust companies TO create special
departments through which all bond
investments should be attended to
For example, there is an estate, left
by A testator. for the benefit of wife
and children, valued at 100000. On
the basis of averages, about $50. 600
of this consists of bond and stock in
vestments. Under the will, the trust
company, which acts as trustee, exc
e
to sell or substitute new securities,
Were an individual To look after the
estate. It is hardly possible that he
would be sufficiently we'll acquainted
with security values or market condl-
tons. to make wise sales or substitu-
tons. The trust company. however
through its bond department, is able
not only TO sell such trust securities
at A profit hut occasionally to sub
stitute new investments which bring
IN large returns and which have
greater stability
Another important reason Why truss
companies have established bond de-
partments Is that the depositors il
their banking department often pre-
fer to withdraw their deposits and In
vest them in bonds which bring larger
returns than the interest given by the
banking department. Such patrons
come TO the officer and are referred
TO the bond manager who selects
satisfactory investments. keeps them
in a safety vault of the latest con-
struction. which is proof against firs.
or burglary. and attends to clipping
coupons. etc. Then there are count
less transactions growing out of the
administration OF trust duties for BORA
individuals and corporations where
manded
In this city the trust companies have
been able 10 promote business and
corporation activities in a way that
would not be possible II capital WAS
available from private sources alone.
A large volume of capital has, there
fore. been kept here and prevented
from going to other centers, because
corporations and business houses
found accommodation at nome In sur
ficient amount. Through these bond
departments the preference In maxi
ing loans or in purchasing securities
has. been extended to local enterprises
People have been educated as to the
value and safety OF investing in bonds
It Is also natural conclusion thai
the trust company, because Of it's
large responsibility. it's capable Of
ficers and Influential directors. has a
reputation to sustain. so that It will
offer to its own clients, OF the public
only, such securities as meet the care
full requirements and "acid test of
Al