Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-02-05

Fridays Testimony.
Following is a complete transcript
OF the testimony given Friday by F..
w. Cathro, manager Of the Bank of
North Dakota regarding the re-depos-
it OF funds in5 the banks of the state:
@. by Mr.. Murphy: Now. calling
Your attention to the question Of re-
sources. there is an item of redeppsit
of public funds of $500; ;sss:19.t See
il. ] am rea ding this correctly. A. Yes
@. Now just what does that mean
redeposit of public funds? A. This was
money that was carried in local banks
throughout the state OF North Dakota
in the name of the Bank of North Da-
kota.
Q. Let me see if ] understand this
correctly. These public funds OF
course. constitute the bulk of the de-
posits in the Bank Of North Dakota,
do they not? A. Yes.
@. The Bank of North Dakota then
redeposits portion of these funds in
different banks throughout the state
Of North Dakota in it's name-that is,
the Bank of North Dakota becomes
dcpositor in various banks throughout
the state? A. When the Bank Of North
Dakota. was organized large proper
tion Of these funds were in these
banks. and the Bank of North Dako-
ia adopted a policy Of redepositing in
Il
check by a local treasurer was sent
to the Bank Of North Dakota, and that
Identical check was returned to those
banks for deposit IN place Of being re-
tanned by the Bank of North Dakota
Those banks at that time were una bic
to pay the money to the Bank OF
North Dakota They had it at that
They couldn't meet their obligations.
and pay it to the bank. Consequently
in order not to embarrass these banks
it has been there ever since in a good
many cases. and we have been unable
to get it out.
Q. AS far as the books are concern
ed the public funds actually belong in
the Bank of North Dakota but they
are trying TO have il redeposited in
the fashion you have indicated? A.
Yes.
Pay Interest.
Q. Now Of course upon these funds
you pay two per cent to the counties
or cities or public institutions do YOU
! not? A. We'do.
Q. And you charge the redepositary
bank four per cent? A. Yes.
Q. Now as I understand you. YOU
say that was your policy throughout
that you redeposited the exact amount
in the bank as was taken out Of it and
| deposited with you? A. No, not the ex-
act amount.
Q. Well. a similar amount? A. Our
position always was in the main-now
we never assumed that he could sus-
tain an exact balance-but in the
main we would try to retain redeposits
in local banks about in proportion to
the amount that came from these 10
! calities.
Q. So that the, distribution would be
substantially the same as it was be-
fore the organization of the Bank OF
North Dakota? A. Yes.
Q. You think that is correct state
ment? A. Approximately so. that is
/ the general plan we tried to follow
Q. Is that true as to counties or dis
tricts OF localities, or has there been
some change in the distribution Of
public funds since the organization of
! the bank. and the adoption of this
| method of redepositing. substantially.
mean. A. Well. portions Of the state
that were not in urgent need of money
from those portions we withdrew
| some of their funds and put them in:o
! sections Of the state where there was
| more urgent need.
! @. Would you specify little oit
there. and give the portions Of the
state from which you withdrew a por,
ton oftthe funds, and the portions OF
the state which in your Judgment were
more IN need Of the money? Give us.
some idea OF how you altered the dis
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