The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1923-12-14
CURB TOBRANCH
BANKS URGED
BY DAWES
Comptroller Dawes, in Report
Urges Check on Spread OF
Movement.
By ROBERT S. THORNBURGH,
International Newa Service.

By ROBERT s. THORNBURGH,
international News Service.
Unlimited extension of branch
banking will mean the eventual
destruction of the Federal Reserve
System, Comptroller of the Cur
rency Henry M. Dawes declared in
his annual report to Congress to-
day.
Branch banking is fundamentally
unsound and is opposed to the
principles OF American institutions"
Dawes said. IF it is not curbed
it will result in a fundamental
change in American banking and
finance"
According to the comptroller
branch banking is monopolistic
and means centralized private con-
troll as opposed to governmentally
regulated coordination.
Move Is Spreading.
There has been q gradual extern
sion of branch banking in seven
teen States, the comptroller salo.
National banks are put under
disadvantage in localities where
State laws provide for branch bank
ing systems for State banks, Dawes
pointed out.
Branch banking is statewide
banking where a single bank ope-
rates branches anywhere OUTSIDE
the city of the parent institution
Dawes continued. This monopoI1s'
tic control of banking facilities Will
result eventually in extlnctlon OF
the unit banks In rural districts.
Dawes stressed the desirab1nty OF
maintaining both State and natlonaI
banks In the Federal reserve sys-
tenn, but added that "it will be I'M
possible for this to continue Wnere
there is an inequality OF privileges
between the two classes.
"The less-favored will be alb
sorbed by the other" he explained.
6sTf the national banks are to con-
tinue to operate as the backbone
of the Federal reserve system,
either the privileges Of the State
banks within the system must De
curtailed or the status Of national
banks brought to an equality with
the other class"
United States Banks Burdened.
Dawes declared that the national
banks are operating under neaVy
burdens due to inconsistencies be-
tween the various amendments 70
the national banking acts and to in
constituencies with the Federal re-
serve act.
He quoted q resolution Of the
Federal reserve board stating that
the board will refuse admission to
banks with branches that may be
established after February 1, 1924,
and that member banks viii not be
permitted to establish additional
branches after that date. Limited
branch offices within the limits OF
cities where the parent bank IL 10.
Gated are exempted.
The comptroller suggested enact
ment of laws including the sub
stance of the Federal reserve reso-
luton. but granting national banks
similar privileges with State banks
in territory where inequality now
exists under the law.
Dawes opposed adjustment Of the
comptroller's office or transfer OF
it's functions to the Federal Re-
serve Board.
Some financial high points Of the
report were:
q. s. Stock Of Money.
Monetary stock Of United States
Increased from $3,73S, 300, 900 In 1914
to $S,603, 700, 900 In 1928, and per
capita money in circulation from
$17.S9 to 1852.
Dividends paid by national banks,
3179 900 900, maximum ever paid in
any one year, exceeding by $13,O0O,-
increase of s2S,25o,OOo in paid-in
capital Of banks and $4,000, 900 in
surplus Of national banks over last
year capital totaling 1882 900, 900
and surplus $1,068, 100000
Banks write off $780, 900 in
losses and depreciation
National bank failures numbered
fifty-two OF aggregate capital Of So
205,000 and approximate $50, 100000
assets. Recovery from failures pre-
dicted as about 80 per cent.
Convictions for violation criminal
banking laws, 100.
DepOsitOrs in u. s. Banks.
Number of savings depositors in
national banks, June 80, 1923, 1901.
III, increase of 1,026,6S9 in year,
while 6,083 banks reported savings
deposits of $3,645, 648, 900.
Number national banks Octoosr,
1923, 1924, with assets OF $21, 700,-
o00, 900.
Approximately 81 per cent Of ma
tional banks June 80 were in Middle
Western States, with capital equal to
&c per cent of combined capital of al
national banks. Eastern States cred
tied with 81 per cent of banks and
nearly one-third of combined capital,
while Southern States had 20 per
cent of the banks and II per cent of
the capital. Western States had 80
per cent of banks and 8 per cent Of
capital.
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