The Washington herald., 1920-09-13
WILLIAMS RAPS
.Y.BANK RATES
Comptroller of Treasury De-
tends Senator's Attack
On Excessive Interest.
3OPER CENT DEMANDED
Declares "Extertionate"
Charges Disturbing Fac
tor to Business.
CBy Universal serviceD

On six recent days two or three
of the great national banks alone
in New York loaned more than
1925, 100000 at rates ranging from
IS to 80 per cent. At the same time
a number of other big national
banks put out many additional
millions at the same "indefensible"
rates which, according to John
SkeIton williams, Comptroller OF
the Treasury. in a statement made
yesterday, are "a distinctly disturb
ing factor in the business and finan-
cial situation"
The figures given here deal solely
with national banks. Of which there
are thirty in New York, and do no,
comprehend loans from trust COM
panies and big private banking in
stitutions.
The facts presented by Williams
are the result OF an investigation
which followed the ruin of a vast
number of investors and speCola-
tors who were compelled to drop
their holdings when loans made al
reasonable rates were called and
extortionate interest demanded.
ComptrOIIer's Statement.
Comptroller Williams said:
a leading New York paper Criti-
Cizes the statements made this
week by Senator Owen relative to
the excessive interest rates charged
by certain banks in New York dur
ing the past year, and says thar
bankers point out that when SEN
ator owen charges that $500, 1000, 600
has been loaned at rates up to so
per cent he is speaking without the
record. Continuing the article says:
That high figure obtained on the
Stock Exchange for about ten min
Utes one afternoon the middle of
last November and probably as
much as one million dollars was
loaned at the rate.
That criticism of the unnamed
banker is misleading. and in
justice to Senator Owen, it is proper
to say that the Senator's statements
on this subject are substantially
correct
During the past year. the bur
densome and oppressive interest
rates to which the Senator refers
have been eXaCted. not in one OF
two possible Insignificant Instances,
as one New York paper expressed
il. and not as to the high figure
as another paper expressed it, for
about ten minutes one afternoon
the middle of last November but
in thousands of instances at numer-
Gus times, and upon call loans ag-
gregating hundreds Of millions of
dollars.
Presents Figures.
The Information on this subject
requested as OF August 5, from all
Of the New York City banks, has
been supplied by nearly all of them
and is now being compiled: but in
anticipation of more complete
statement which will be available
later it may be interesting to the
public to know that the amount Of
demand loans, upon which two or
three Of the banks, only. exclusive
OF various others which were charg-
ing the same ratesJ were eXacting
20 per cent or more per annum in
tercst-in some Instances as high
as % and 50 per Cent-was:
"On November IS, 1919, about
$50. 900 600
"On November IA. 1919. about
S4O.OOO,OoO
The new call loans at the rate of
25 per cen. per snnum n,~-le by one
Of these banks at the close OF the
year on December 20. 80 and 81
aggregated about $50 900.
"On January >, 1920. the two or
three banks referred to were lend
ing at IS. % and 25 per cent inter-
est about S75.OOO.OOO.
"On January 8. and 5, the two
or three banks referred to were
lending at IS per cent interest from
$50 OOO. 900 to s7O.OOOOOO.
On February s. 1920. at 20 and 25
per cent interest. over s4O,0O0.O0O.
"On February .. 1920. at 20 per
ccat interest about $4,000. 900.
AS late as the end Of June it
appears that interest as high as
- per cent per annum was being
demanded by these banks on millions
Of dollars Of call loans.
Defends senator owen.
These illustrations are from the
official records Of only two or three
of the thirty odd national banks IN
New York City. but are sufficient,
7 think. to show the unfairness and
inCOrTeCtncsS Of the criticisms Of
Senator Owens just condemnation
of the excessive interest rates which
for some time past have been a dis
tinctly disturbing factor in the bust
ness and financial situation.
Il am pleased to confirm the state
ment which I made some time ago.
that although the aggregate amount
upon which unjust and oppressive
interest rates have been exacted by
some banks is very large, majority
nf national banks in New York City
have made a comparatively small
proportion OF their loans at these
indefensibIc rates"