The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1917-02-19

state OF North Dakota, patterned after
the law Of South Dakota.
In the series OF hearings held before
| the state affairs committee Of the sem
ate, conflicting views were presented
by the bankers of the state as to the
advisability Of adopting the guaranty
measure, objections so familiar to the
students OF the guaranty principle, be-
ing advanced.
Under the terms Of the measure that
has been framed, every effort has been
made TO reduce to a minimum, the
possibility of wild cat banking. 1t has
always been held that the guaranty OF
bank deposits placed a premium upon
loose banking methods, and to circum-
vent that possibility, the bill has been
drartea to require a stringent exam
1ns,1on before any bank can enter un.
der the provisions Of the measure, and
the present system OF examination by
the state bank examiner is maintained.
To create the fund an annual levy
Of one-twentieth Of O. mill is provided.
The deposits shown by the last report
OF the state banks aggregated $91, 000,-
600, and thus the levy OF twentieth
OF mill would produce nearly $4,000
year.
At any time the guaranty fund
reaches q total Of one per cent Of the
deposits, the levy is stopped. It will re-
Quire, however, at least 20 years before
such condition will be created, and
probably more, because Of the constant
increase in the states bank deposits.
A commission, known as the Depos-
itors' Guaranty Fund Commission,
made up of the governor, the state
bank examiner, and three members ap-
pointed by the governor, his choice to
be made from a group Of nine men, the
names to be submitted by the banking
institutions coming within the provis-
ions Of the act, is created under the
first section of the bill. Such three ap.
pointed commissioners shall be men of
at least five years experience in the
banking business; one shall be named
for term Of one year, one for two
years, and one for three years, and
each succeeding appointment, except
to fill a vacancy caused by death, res
tgnation, or removal of q member. shall
be for a period Of three years. The
group Of nine names to be submitted
to the governor by the banking insti-
buttons directly affected by the pro-
visions Of the proposed law, must be
transmitted to the executive through
the agency Of the corporation known
as the North Dakota Bankers assoc
citation.
The governor is made the chairman,
the attorney general of the state is
made the ex of1cio attorney for the
board, and the state examiner is made
the secretary. Each commission MEM
Der receives IS a day for time actually
spent in attendance at commission
meetings, etc., except the governor and
state examiner, the per diem and. ex-
penses Of members to be paid out Of
the general fund Of the state.
Such commission is given supervision
and control Of the depositors' guaranty
fund, and is given power to adopt all
necessary rules and regulations, not
inconsistent with law, for the manage
ment and administration Of the fund.
Under the bill as it was originally
introduced, the commission members
would have included the governor, at
torney general, secretary Of state. and
the president and secretary Of the
North Dakota Bankers association.
The amended provision was brought
out by the state affairs committee OF
the senate, with Senators Allen Of EN-
mons. and Heckle of Ransom, the sub
committee in direct charge.
Within 10 days Of the taking effect
Of the proposed act, which would be
between July 1 and July Is, for the
emergency clause proposing that the
measure become Immediately operative,
has been abandoned, the commission
members would be required to take
their oath Of Office, such oath to bind
the members to secrecy as relates to
facts and information obtained in the
performance Of their duties, in like
manner with the state bank examiner.
Each member Is required to furnish
$40, 900 bond, paid for by the state,
except such commissioner as shall be
elected treasurer of the commission,
Of whom q $4,000 bond is required.
The commission would hold four
meetings annually, sessions being fixed
for the second Tuesday in January
April, July and October, provided that
special meetings may be convened
bers, or at any time the secretary may
deem it advisable. All meetings would
be held at the Office of the bank ex-
aminer, at the state capitol.
Specific duties laid down for the
members Of the commission require
them to pass upon the qualifications Of
each and every bank for admission
under the depositors' guaranty fund.-
and their actions shall be final, both
as to immediate admission, or what
shall be further required Of any bank
to place it in q condition satisfactory
to the commission so that 1t may be
admitted later. When the condition OF
any bank heretofore admitted under
the depositors' guaranty fund becomes
such as to cause the state examiner to
doubt the advisability Of permitting
it to continue in business, 1t shall be
within his power to require the advice
and opinion of the commission, and for
that purpose meeting OF the com.
mission may be called.
For the purpose of creating the guar
anty fund, every bank engaged in bust-
ness under the banking laws or this
state, is made subject to assessment.
It is made the duty Of the bank ex-
aminer and his deputies, or any quail
fed examiners the commission may
select, to examine every state bank
and trust company doing business in
the state, such examination to be made
within six months after the law be-
comes effective.
No assessment shall be levied against
any bank until its Ncondition Is found
satisfactory. Banks that may be In un-
satisfactory condition, and of which
additional conditions may be required,
must meet such added requirements
within three months of the time. Upon
failure to comply with the commits
sion's requirements, such bank will be
closed by the examiner, and its affairs
liQuidated. The commission, however, is
given discretionary power to extend
the time SIX additional months.
Within 80 days after July /. next the
banks will be required to file a state
ment of their average daily deposits
for the preceding twelve months. Inn
mediately after August /, the commits
sion shall make a levy of one-twentieth
of one per cent Of the average daily de-
posits as shown by such statements,
until the total amount of money in the
fund reaches one per cent OF the aver
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