The Birmingham age-herald., 1917-06-19

1 ate finally accepted conference report
 previously approved by the House. | The first effect of the changes, it is be- lieved, will be shifting of more than $3OO,- 0O0. 900 in reserves from the banks of the
 country to the federal reserve banks. where the great store of gold will be in a position to achieve it's maximum ef- | ficiency.
 Under the existing law, the banks had until November to divert that portion or their reserves with other banks to the federal reserve banks. The amendments advance the date, and the diversion of the gold to the reserve banks is ordered at once.
 Hundreds of large trust companies ana state banks which heretofore have re- mained outside the fold are expected to come in under the amendments. These institutions will bring into the reserve system many hundreds of millions of ad- ditional reserves. With their addition officials believe that the financial sys- tenn of the country will be as nearly impregnable as human ingenuity can make it.
 Accession of trust companies and state banks will be brought about in two ways: The institutions may join the system out right with the privilege of withdrawing at anytime, upon a years notice-a priv ilege not granted them by the unamend- ed law-or they may by depositing a portion of their reserves with federal reserve bank become members of the fed- eral reserve clearance system, the most effective in the country.
 The proportion of the reserves to be deposited, in the latter case, has yet to be determined upon by the board. It is likely that the minimum will be 50 per cent.
 The federal reserve system at present
 includes in its membership less than 100 state banks and trust companies. The re- maining banks, approximately 7500 in number, are national banks which auto matically became members upon the passage of the reserve law. Resources of the system approximate $16000,O00 GOO, or about half of the total banking resources of the county. It is expected that this figure will be increased perhaps as much as per cent during the coming year.
 Another amendment facilitates the es- tablishment of branches of federal re- serve banks simplifying the organization of the branches and decreasing the ex- pense. It is thought that this amendment
 
 short time, of branch banks at Baltimore, Louisville and Denver and possibly other cities.
 The so-called Hardwick amendment, which provided for the legalization, un der certain conditions, of a collection charge on checks cashed by member banks on out of town banks was modified so that such a charge cannot be collected except with the approval of the board.
 Whether the incoming state banks will have to divest themselves of director ates interlocking with other institutions is mooted question, under the amended law. Some of the framers of the law be- 'lieve that such action will not have to be taken. It is possible that the courts will be called upon finally to decide this question, in case of conflict.
 The federal reserve board has advo- cated the passage of these amendments for more than year. Their final passage is regarded as one of the most important steps taken to strengthen the countrys financial system since the passage of the act itself.