The New York herald., 1920-01-05
SUGGESTS CHANGES
IN STATE LAWS To
MD BANKS HERE
Legislature May Consider
Amendment to Extend Scope
of Branch Offices.

ALBANY, N. Y, Sunday.-While the
revision OF the banking law of New York
State as passed in 1914 has borne the test
OF time the Legislature OF 1870 may be
called upon to consider certain amend
ments. In his forthcoming annual report
to the Legislature, Superintendent OF
Banks George I. Skinner refers TO two
suggestions which have been made to
amend the banking law to meet new bank
ing conditions and developments.
Tho banking law OF the State was
passed in 1914, has borne the test of time
exceptionally well and most of the amend
ments since adopted have been the logical
sequence OF changed conditions" says Mr.
Skinner
There are two amendments which have
been suggested as a result of new con-
dtlons and new developments which II
may become necessary for the Legislature
TO consider. although / am not prepared
to submit such amendments. or approve
them at this time. State banks, trust
companies and investment companies of
this State are authorized by the banking
law, upon compliance with specified con-
ditions, to maintain branch offices in for
eign countries Similar privileges nave
been conferred upon national banks am.
upon corporations to be created under the
so-called Edge bills recently enacted by
the national Congress.
Our institutions may receive deposits
in foreign countries, while foreign bank
ing corporations are only permitted to
maintain agencies in this State for the
exercise of limited powers, and are not
permitted to receive deposits. 1t has been
urged that IL New York city is TO become
the money mart of the world and this
nation is to maintain foremost position
in International commerce. the restric-
tlons imposed upon the agencies of for
eign banking corporations are provincial
and will lead to retaliation.
The effect of a change in policy upon
such of our existing banking institutions
including private bankers, as cater espe-
cially to our alien or or foreign born pop
ulation, should also be considered II such
an amendment is at any time deemed
necessary, 1t should. moreover, require
any foreign banking corporation receiv.
ing deposits in this State to have at least
as much capital and surplus as we re-
quire our own institutions TO have, II they
are permitted to maintain branch offices
abroad
Branch banking under certain condi-
tons and limitations has been so Ions
permitted and practised under the laws
of this State, as well as in other coun.
tries and States, that it can no longer be
considered an experiment. There is nc
doubt but that under proper restrictions
ii has It's advantages. and enables strong
institutions TO afford banking facilities ir
localities which would otherwise be with.
out them.
l1str 80.
bank or trust company to establish and
maintain a branch office within the State
in the same city in which the principal
office of the institution IL located, yet
almost every large city is surrounded by
small suburban villages having an inde.
~5ndent corporate existence and in need
of banking facilities. although the success
of an independent institution would be ex.
tremely problematical
''It has therefore been suggested tina:
an institution with adequate capital be
allowed to maintain branch offices ir
other municipalities than that in which
it's principal office is located Ir such
branch office were located within twenty
five miles OF It's main office. as close
supervision could be exercised over its con
dition and management as if Il we're with
In the boundaries OF the same city.
eff any such legislation should be en-
acted, il should, however. protect exist
ing independent institutions for stronc
institution should not be allowed to en-
cruach upon territory that is being well
served by an independent institution. Ans
amendment OF this character shou'c
therefore. in my judgment, provide that
such a branch office should not be estab-
Iisred In any place where it would CONS
in competition with an independent tnstitu'
ton after its establishment