The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1917-06-20
CHANGES aEsEnE act.
SENATE FINALLY AGREES TO
OonF.ERENCE REPORT.
1e9ovea qAat AmcasAaen&s % Bassk-
~ Law WIN Mako for Enhance.
zncns of stability.


menss TO the federal reserve act
designated to strengthen, tho nnancia
system or tho country by the concen.
tration OF gold reserve In federal re-
serve banks aud to open wide the
doors Of the federal reserve system
10 the State banks and trust COM
psni>A were sent to the president to-
Cay for his signature. The senate
nnally accepted at conference report
prsviously approved by the house.
The first effect Of tho changes. II
- bslisysd. viii DO the shifting OF
more than $soo.ooo.ooo in reserves
from the banks OF the country to the
federal reserve banks. where the great
store Of gold win be In position to
achieve its maximum efiiciency.
Under the existing law. the banks
bad until next November to divert
that portion to the federal reserve
haDka The amendments advanced
tbs date and the diversion of this
gold to the reserve banks is ordered
a once
Hundreds OF large trust companies
and state bsnks which heretofore have
rsloainsd outside the fold are ex-
pectad to come In under the amend
nsnts. These institutions will bring
Into the reserve system many hun
.lrsds oi millions OF additional re-
esrvea. With their addition officials be-
Nave that the financial system of the
opnntry win be as nearly impreg-
paeis ~ human ingenuity can make
NJ
Accession of trust companies and
9ta>s banks will be brought about in
two ways: The institutions may join
ths system outright with the privilege
ysar's notice. privilege not granted
them by the unamended law-or they
may. by depositing a portion of their
receives with a federal reserve bank,
-" - ~s~@s ~sstS cyosShi
become members Of the federal re-
The proportion Of the reserves to
be deposited. I'm the latter case, has
yet to be determined upon by the
board. II Is likely the minimum will
b So per cent.
The federal reserve system at pres
ant includes In It's membership less
ehrn 100 State banks and trust CON-
panies. The remaining banks, ap-
pvoximately 1900 In number. are ma
ttonai banks which automatically be-
came members upon tho passage OF
the reserve law. Resources Of the
syssem approximate $4,000. 900. 900.
Another amendment facilitates the
establishment Of branches OF federal
reserve banks by simplifying the or
ganisation Of the branches and de-
crcasing the expense. 1t Is thought
that this amendment will result In the
establishment. within short time, OF
branch banks at Baltimore. Louis
Vile and Denver. and possibly other
Cities.
The so-called Hardwick amendment,
which provided for the legalization,
under. certain conditions. of q COL
lection charge on checks cashed by
member banks on out Of town banks,
was modified SO that such a charge
can ot be collected except with the
approval of the board.
whether the incoming State banks
Will have to divest themselves OF
dlrsctorates interiocking with other
institutions Is a moot question under
the amended law. Some Of the fran
ers OF the law believe that such ac-
sson will not have to be taken.
The federal reserve board has ad-
vocated the passage OF these amend
ments for more than year. Thei,
final passage rs regarded as one o.
the most important steps taken tc
strengthen the country's financial
system since the passage of the act
tsssIf.