Evening star., 1922-06-16


irgs on common stock had neglected
to take in profit and loss debit figures
OF some 100000. which would actu-
ally reduce the earnings on common
stock to little over IL per cent.
Also the latest information regard
ing the amount held against the rul-
Ing on the cut-rate price of electric
light to 5 cents as compared with the
10 cents. is that $3.000.000 Is impound-
ed: invested in liberty bonds very
largely. and that there is good
Profit in the bonds at present high
prices.
With these exceptions the story in
the Babson circular is said to be OK.
In conclusion. the Babson circular
1T is very evident that the COM
pany has substantial earning power
and that in the normal course Of
events dividends may again be
looked forward to in the next year
or so. Moreover. there is an added
speculative feature to the stock. due
to the fact that the Potomac Elec-
trio Power Company is holding in
escrow fund of more than $4,000. 900,
equivalent to nearly $40 share.
which may revert to the common
Commission established rates in 1915
on the basis of the 1914 valuation.
and the District Supreme Court up
held the commissions action.
The Court of Appeals last Novem-
Der. however, reversed the decision
of the lower court and upheld the
company's contention. The commits
sion has. we understand appealed
to the United States Supreme Court.
The company is collecting 10 cents
per XVIII. of which it keeps S.075
cents, and places the balance in the
fund above mentioned pending the
outcome of the case. If the company
loses it will simply have to turn over
this fund. The position of the stock
will not be affected.
IF the company wins the stock
holders should receive a substantial
distribution. Entirely apart from
this decision. we believe Washington
Railway and Electric common to be
a good long-pull bargain at current
lovels of around Al. 1t is listed on
change. but is not active in the New
York market Enter orders at def1-
mite price rather than at the mar
ket.'
Comment on Bank Bill.
The following is contributed by F.
NJ Savage. president of the Northwest
Savings Bank.
There is a bill pending before the
House of Representatives requiring all
banks in the District Of Columbia to
have. at the expiration of three years.
capital of 100000.
ITO safely operate and pay dividends.
additional requirements OF $4,000 sur
plus and about $4,000 undivided profits
are required and therefore, under the
cessary; but, l think tnat conservative
bankers would save $4,000.
ITO operate bank with $275,000
capital assets 1T may be fairly assumed
that deposit of s1,500.000 is essential:
There are a number of useful and needed
community banks in Washington that
haven't much over half that amount OF
deposit. and the territories occupied BY
those banks haven't any such deposit
resource as s1.5OO.00O.
ITO force existing banks into the
capitalization outlined prevents their
being profitable and therefore does not
seem just.
II have suggested to Mr.. Millspaugh.
who seems to understand the situation
in Washington. that the compromise be
effected whereby existing banks may at
the end of three years continue to op-
crate for another two years with a
capital of one-hundred thousand and
surplus of fifty thousand. and that at
the expiration of five years. requirement
of one-hundred thousand dollars capital
and d hundred thousand surplus may
be required.
"The suggestion made will be a
test as to whether existing banks
are profitable and. if they prove to
be prOHtdDle, II di sues ioi lhch Soh
tinuance.
This, however, is made on my part
as a plea that several of the smaller
and well managed banks in the city
be not forced out of existence. There
ia absolutely no need of additional
bank capital in Washington. The
institution that / represent has been
able to take care of all worthy bor-
rowers in this neighborhood. and
does not now have use for any fur
ther capital nor will it have use for
more capital, except such as accrues
in the surplus through policy of not
paying dividends until the surplus
shall equal it's capital. On behalf
of some other institution as well as
ourselves, we enter a plea for your
earnest consideration and a fair deal.
perhaps the city can be zoned."
Personal Mention.
Mr.. and Mrs. F. NJ. Savage leave
this afternoon for long voyage,
which will keep them In South Amer
lea and other foreign lands until next
october.
Albion X. Paris has returned to
Washington looking much improved
in health after tour of France.
england, Egypt and the Holy Land.
Milton Z. Allies is in New York.
On the Stock Exchange.
On the Stock Exchange today the
sales made were at strong prices.
Railway common was sold again at
so. Capital Traction was strong at
9sk Washington Gas toppy at 6S u
Bonds were strong at 941s for Gas
IS, 100 for Potomac debenture IS and
14k for Railway 4s.
MARYLAND LEAF TOBACCO.
nAr rIMoRE Toua 1c-pecnfdtS In :