Arizona republican., 1917-10-15
.U.S. BANK HEAD
 COMES T0 AID B0ND MARKET
National Banks Not Re quired to Charge Down
 High Grade Bonds to Ab-
 norm Fly Low Prices

The rush to sell high grade securi- lies in order to reinvest the proceeds in Liberty Bonds, has caused an undue and abnormal shrinkage in the quota tlons of many such firse class securi- ties.
 The comptroller of the currency has come to the aid of holders of such se- curltles, and in an order to national bank examiners, has directed that they do not charge down such high grade securities in the possession of such banks to the present abnormally low quotations.
 In a telegram to Jesse L. Boyce. Ari- 2Ona bank comptroller, the comptrol- Ter of the currency yesterday issued the order in this state which is to stand until the immediate causes of the shrinkage are removed and the securi- ties return to their real value.
 The, telegram is as follows:
 State Auditor and Bank Comptroller, Phoenix, Ariz:
 Owing to the efforts of holders of securities throughout the country, but especially in the east, to dispose of them for the purpose of reirfTesting their proceeds in Liberty Bonds, and also because of other special reasons operating at this time, there has been a heavy shrinkage in the market quota tions of many high grade investment securities which have been forced down to prices far below their intrinsic worth and below figures to which naturally they may be expected to return upon the restoration of normal conditions.
 This depression temporarily has ere ated a degree of Gneasiness which is hIr h1 Cin your information, l annex hereto copy of a statement which this office today is giving to the press for publication in Monday mornings papers. The statement is as follows:
 After the outbreak of the European war in 1914 the comptroller of the cur rency instructed national bank eXami- nerS that national banks need not be required to charge down the values of their high grade bonds to meet the ab- normal and sacrifice quotations which for a while were being made on the outside market, the stock exchanges being closed, on securities which at that time were being thrown overheard regardless of real worth. This office al- so earnestly endeavored to prevent the sacrifice by national banks, while the exchanges were closed and there was no general market for securities, for londs and shares held as collateral for customers loans.
 The policy pursued proved fortunate at that time. After the first pressure was over and money conditions relieved 'he security market was e-established. The grave losses which were threat ened by the temporary shrinkage in values were averted and borrowers from banks were enabled to meet their obligations without the sacrifice of the collateral
 Since the commencement of war be- tween this country and Germany, there has been 2 heavy depreciation in the quoted values of securities generally including those of the very highest grade which have heretofore found ready market in competition with gov ernment issues and in many cases prices have shrunk to figures which are manifestly far below the prices winch would prevail under any normal condi- tions. This shrinkage or marking down of values is partly due to the efforts of investors to sell other high class secur- itie for reinyestment in government bonds.
 In view of all conditions, the comp troller of the currency has instructed national bank examiners that they need