The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-06-11
BROADWAY TRUST
TO ENTER RESERVE
First Of Great State Institu-
lions Joining Federal
Bank System.
LEE CALLS LAW GREAT

TIE Broadway Trust Company At q
meeting Of the board of directors yes
terday voted to apply for admission to
the Federal reserve bank system. 1t Is
the first State institution Of size In New
York 20 TAXI such action.
Frederic @. Lee. president Of the COM
pany. described in glowing terms the
large advantages which ne thought
membership in the reserve system con-
ferred. A majority Of State banks and
trust companies, however. showed no
disposition yesterday TO Join the reserve
system. despite the fact that the regula-
lions governing membership were be-
lleved to have been drawn IN q broad
and helpful spirit.
Mr.. Lee named tho rediscount privi-
lege OF the reserve system as its chief
attraction. IF this right Is not appre-
cla.ed by the State institutions It will
be by their customers he said. my
own feeling has been from the start that
the Broadway Trust Company should
Join tho system, as its banking bust
ness ~ practically all commercial and
Its assets Of the character which are
acceptable under the reserve bank law.
Think. I. On. ofor,...., Acts.
Personally. I have from the nrst
been impressed that the Federal reserve
law is one Of the greatest ever enacted
in this country and viii Be OF untold
benefit to business interests I have
also felt that there was every reason for
state institutions Joining. and or
nearly none. why they should not In
this. however. I admit many State bank
men. with whom l have discussed II, do
not agree with me. but l nave yet to
hear an argument against Joining which
impresses me as being we'll founded.
"A vague fear OF political control or
interference is frequently expressed. but
II there Is anything In this. and can.
not believe there is, It might be equally
true OF State control. As a matter OF
fact the control Of the Federal Reserve
Bank rests with it's stockholders. as In
any ordinary bank or corporation. and
these stockholders are the member
banks themselves. Anything they do
not like they have the right and power
TO change.
THE right OF withdrawal from the
system conferred BY the new regula-
lions gives the State bank members
a great influence. as they will have
the right. which he national banks have
not. OF showing their disapproval OF the
management or policy of the reserve
bank by their request for retirement"
Calls Regulations Fair.
Walter f. Frew. president OF the Corn
Exchange Bank. said yesterday that he
regarded the regulations by the Fed
eral Reserve Board for the admission OF
State Institutions as having been very
we'll drawn.
'"rhe regulations are fair and drawn
in a broad spirit, so far as the act
permits he continued. The reserve
board has put it's proposition to the
state Institutions under favorable terms
and II is up 10 each institution individ-
uslly to decide. feel. however. that
the large numbe Of State institutions
will continue TO hold 10 their policy OF
watching results and will not Join until
the reserve system In their opinion has
demonstrated it's success
Some State institution heads pointed
out that unless confirmed In the act It.
sci! the regulation regarding withdraw
ais OF State institutions from the system
would not satisfy them. as II might
be changed r the reserve board at any
time In n manner adverse TO the State
hanks after thCV had ioin.d.