New-York tribune., 1920-03-15
HoaU Neigsbo Banks
Make Profits on Deposits
Seventy-tive Per Cent of Customers Seek No
Credit, but Half of the Loanable Funds Is
Lent to Brokers on Stock Exchange Collateral

NEIGHBoRHO0D banking, which is
now aourishing- in the residential
parts of the city. M distinguished by it's
simplicity. In this era when the larger
business banks are stretching out
with branches into all parts of
the world and the complexity of bank
ing is multiplying in geometric pro-
gressions, the little bank on the corner
UP town stands in sharp contrast to it's
contemporaries in Wall Street, the new
financial center of the world.
In essence, neighborhood banking
consists of accepting money on de-
post and then placing the funds out
at interest IN the form of loans. The
tremendous money reservoirs in the
financial district perform these same
basic functions Of bank, but their op-
eratlons are more numerous, more COM
pick and more farreaching. AS re-
suit OF the growth of business and a
broadening Of the conception of what
part bank can play in commerce and
in life, the leading institutions on
money row have assumed countless col
lateral functions. the scope Of which a
visit through one of the large institu-
tions will readily suggest.
Contrast the working Of the highly
SSAhPiiSatcu mechanism Cnat great
downtown bank is with the functioniny
Of neighborhood institution. Several
banks specialize in uptown business.
Banks like the Corn Exchange Bank.
the Chatham and Phenix National
Bank and the New York Produce Ex
change Bank conduct branches through
out the city, but they are In the busi-
ness districts as we'll as the residen-
tial. The Colonial Bank and it's
branches more clearly represent the
contrast between the uptown and the
downtown bank, because all its
branches are in residential districts.
Sixty Per Cent Women
Calling itself "the local bank Of the
West Sde," the nine Offices of the in
stltution. none Of which is below Sixty
eighth Street, cater chiefly to indi-
viduals. Seventy-five per cent of its
depositors are individuals who place
their personal funds in the branches.
OF all the deposits of the bank so per
cent are women-almost entirely mar
ried women, who deposit their allow
ances for housekeeping. The other 25
per cent Of the depositors are mainly
neighborhood business men, chiefly
local storekeepers
Although one-quarter Of the ac-
counts which are in the name of busi-
ness men represent the income and the
outgo of funds - since the business
men seek credit as we'll as make de-
posits-the other three-quarters. the
personal depositors, do not, generally
speaking, ever seek credit at the bank
They. seek merely place to keep their
personal funds safely and the privilege
of a checking account. But bank does
not earn money from accepting de-
posts and allowing the checking priv
l.legee. 1t makes profit as lender of
funds-and rs per cent OF the depos-
ltors of this neighborhood institution
do not borrow at the bank.
In view Of this unusual banking stu
alton, in which the overwhelming pro-
portion of the banks customers are
not borrowers, Alexander C. Walker,
vice president Of the bank, who makes
his headquarters at the main office. at
Columbus Avenue and Eighty-frst
Street, the nerve center Of the system,
was asked what the bank does with it's
loanable funds.
with the present nationwide short
age of credit" Mr.. Walker replied. mo