The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1920-11-22
BANK OF n. D. TO
SEEK DEPOSITS
OF INDIVIDUALS
Change of Policy Is Announced
in Circular Letter Through
States -
INITIATED LAW CAUSE
Bankers Do Not Expect Large
/ Amount of Money to Be
Diverted to State Bank

by the Bank of North Dakota.
The bank, in circular to treasurers
and governing boards of public cor
pOrations; says 1t will open the bank
to individual depositors after Decem-
ber I. & z|
This action is taken, it is stated in
the circular, because the enactment of
the initiated law places the Bank of
North Dakota where it now must to
some extent enter the competitive
field with the state and national
banks of the state
Facing the loss of millions of dol
lars of public deposits under the ini-
titated law permitting withdrawal of
deposits, the bank is out to get indi-
vidual deposits.
The threat that this action would be
taken was issued sometime ago by the
bank. The announcement did not ere
ate any surprise or CONSERVATION in
banking circles.
Bankers Not Alarmed
The bank cannot be expected to
draw great amount Of money from
individual depositors. in the view Of
many bankers. !
F. E. Packard, assistant attorney
general, has declared that under ex
listing laws deposits in the Bank OF
North Dakota cannot be guaranteed by
the state All other state bank de-
posits are guaranteed. Bank officials
declare there is no basis for this the
Ory.
F. w. Cathro, director general of the
bank, refused to predict how much
msney might flow into the bank. 1t
would be matter Of growth, he said.
The November Is statement of the
bank lists as individual deposits OF
the bank $214926.33. Mr. Cathro said
this was money from labor unions out
side the state He denied the bank
had been receiving deposits of indi-
viduals within the state.
The following, circular letter was
sent out by the bank concerning the
interest rates to be paid beginning
with December /: a.-r
"To Treasurers and Governing
Board of Public Corporations: The
enactment of the recently initiated
law places the Bank of North Da
kota where it now must to some eX-
tent enter the competitive field with
the state and national banks in the
state.
Heretofore the bank has placed
money with state and national banks
at rates of interest at which such
banks could afford to reloan in their
several communities at profit. .TEe
bank has charged 4 per cent on 1t,
redeposits in banks and 6 per cen.
on it's rediscounts from banks. It
appears now that the Bank of North !
Dakota must enlarge its activities |
and that it, isgno longer bound to !
limit it's redeposits to 4 per cent, nor
it's rediscounts to 6 per cent and for
that reason it is in position to in
crease it's interest rates on deposits.
Furthermore it. appears that the
operations of the bank, as to interest
rates paid during it's experimental
year, did not satisfy the group in con-
troll of the bankers association and |
there appears to be a demand for
the bank to pay larger rate of in
terest, now that it is, entering upon
the second year of it's operation.
For these reasons the Bank OF
North Dakota has rearranged it's in
terest rates, and beginning December
1, 1920, will pay the following rates
per annum, computed quarterly for
the actual number of days and cred
tied during the following month:
"On checking or demand deposits
received from treasurers on which ;
the balance is not permitted to fall
below 5000 during the month, 2 per
cent.
"On such deposits which do not fall
below $500, 272 per cent. g.
"On such deposits which do not fall
below $500, 8 per cent.
"On sinking funds remaining on de
post more than three months and
less than one year. 4 per cent.
"On sinking funds remaining on de
posit one year or more, 5k per cent,
computed and credited semi-annually
on January and July l.
'On sinking funds remaining on
deposit less than three months, or on
sinking funds withdrawn after the
semi-annual interest date. the same
rate as demand deposits of - like
amount"