Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1920-10-18
tContinued From First page.)

| ihS'UHcch OF aDusc.
| Hhotner leading New York pape,
aeclareu that the high rates quoted
on the Stock Exchange applied only
A small amount or moncx
relatively speaking.
made since my public statement on
v ,inS suSJeet completely confirms the
were IL anything. too conservative
Cites Bani<s' Report.
IN order that the pubic might be
iiuiiS informed. and know the exact
banks in New New York 1fk Gin the w nntion na
4mested by the Comptroller of the
i!Zo, to furnish. under oath, a report
OF the number and amount OF ali dc
siaeE. Loans @sGo secured secured. by bonds and
tween October /. 1919. and July 81,
ilH2O; upon which they had eXacted
interest in excess of per cent per
e nimuii,,, The banks generally, in
quest, but three banks demurred,
eiaiming that it would be imprac-
aiG I Tor them TO furnish the data
eniieu Tor as TO various loans made
pS thcm at excessive interest rates
ny months as requested. They were,
ff nep' requested TO furnish in
them for about eight days in each
month since October !. 1919. these
eight days including. generally, the
Misn money periods in each month.
It should be understood. therefore,
mat In tho statement which follows,
three of the 'arger banks have In
ciuded only portion, and not all,
oi .. smelr loans Sr made at the high rates.
submitting their statements. to
count as a new loan each change in
me cne interest rate on their existing
should be made for 100000 TO a
brokerage firm by Il certain bank at
~ per cent, and the rate changed
I'VE times in thirty days, this loan
would be regarded as six loans with
an aggregate OF $500. 900. Therefore
these demand loans embraced in this
statement should be considered as
should also he explained that, in the
case OF one of the three banks which
reported it's loans for only portion
OF , The period call loans are included
bank for outside banks as we'll as
for Itself. These outside loans
sometimes amounted to more nno
sometimes TO less than the call loans
made by the bank for its own ac-
count.
The sworn reports to this office
show that during the period from
October ,Sapa w l.. isia' to august I. 1870;
banks in New York city more than
900 loans nj rates of Is. 20. 25 and
~ per cent per annum. and that the
only portion. of those made during
this period at the above rates in
three OF the largest banks, aggre-
gated oyer $60o,Qo0,0o0.
The records also show that the
total loans outstanding upon which
interest n Ii to 80 per cent was
being charged by portion of these
FOR which reports were received
rom them, aggregated over s1,l0o,-
oOO,oOO 1t Will be remembered that
IN my statement of July 81. the
banks were charged with making
and IS per cent Tho actual facts.
therefore, in view of the loans made
at ID per cent 20 per cent and 30
per cent. indicate that my statement
was extremely CONSERVATIVES
The records also show that tho
amount of loans made during the
same period AT rates in excess or
~ per cent and up to. but not in
einninE /" per cent. amounted to over
OF such loans
In addition TO the above the ag-
greEate of the loans upon which a
portion of the banks reported that
thcE were charging. on eiGhty-one
aailercnt days. interest In excess of
10 per cent. and up 10 but not in
Guiding 10 per cent. was about 5000
gIon,ogo' The brokers or Street
banks, during the period referred
10, were charging more than s per
cent per annum and. up to 10 per
S Sm,', reach: IN the aggregate. some
onions or dollars additional in
number. "
1T should be understood that these
loans except In the case OF one
Shhk) represent the money loaned
Dy the banks for their own account,
and the figures do not include the
banks.
AS result OF persistent inquiries
S S,ncks the banks. brokers and
~ now. for tho first time, able to
MORN the public as to how tho So
Called renewal rate is made from
nay 10 day. in the New York call
Willy Why market, and the extent 10
~hicn thiS money rate is observed by
nc New York banks In making their
ch"rGcs on ordinary Wall Street or
brokers' loans.
Under the New York banking
in"' IL TX inwful for u Iencdr tn
charge amy rntc Of interest which
may he agreed upon with the Dor
rover on demand ionn for 81, 1000 or
more secured by stocks. bonds or
other SECURITIES. This proyisIop or
the New York stnrutc enabies lend.
cry TO escape penalties for usury
Which cIist In most of the other
states.
toterie Arranging Lonns.
from information furnished this
Office. through different sources II
appears that every business day a
So'eTle OF brokers. members OF the
New York Stock Exchange, get to-
sctner Tor consultation on the floor
81 me eNchange, or by telephone, and
a"i.rmine what. in it's view. is the
proper rate for the renewal or ali
rect or brokers' call loans for that
DAY. -is soon as tho rote Is agreed
upon the president OF the Stock Ex-
.n"hsc is notified, and the rate Is
rostcd on the floor OF the Stock
HN. .r.,as at, say: II o'clock
ms rate Is then sent over tho
vticker, to all the hanks in New
upon mark up or down. as the case
ma? be- the rate of interest upon
practically all their Wall Street
or so-chiled brokers' loans. some
"ahks take the .Drecaution to notify
enc'r customers by card. sent by mail
Iaros, "'rMise. or me change In In
t.rest rate on .heir loans, while
other banks do not. They claim tina :
me posting of the renewal rate on
tue moor OF the Stock Exchange
serves automatically to raise or lower
nc rate of interest on this charac-
Yer or loans. held by ali the New
iork banks. for themselves or their
,S ueIo' Town correspondents. and
sneir customers are charged the rate
30 posted, unless they make special
arrangements with tho bank To the
contrary, or pay the loan
tho QUESTIONABLE sent by the
COMPTROLLER OF the Currency TO all