Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1924-01-02
YEAR HAS BEEN
NORMAL ONE FOR
BANKS OF MAINE


Hon. Fred F. Lawrence of Show
hogan, State bank examiner, said
Tuesday that the calendar year 1923
Maine State banking institutions,
with little which could be termed of
more than. passing interest.
There has been a steady growth
in deposits in trust companies and
savings banks and in the accumu-
lated capital and loan and hlilding
associations continued Bank COM
missioner Lawrence, although the
rate of growth. as might have been
anticipated, has not been compar-
able to the remarkable increase in
the two decades between 1900 and
1920, when the aggregate resources
of these institutions more than trip
led, increasing from SST,000,000 to
SECS. zoo, 900.
"The combined resources Of the go
National banks in Maine on June 80,
1928, the latest date as of which in
formation is available. were shown
by the report of the comptroller Of
the currency, to have been S1e5. $751;
600.
Perhaps the most striking fea-
ture in Maine banking in recent
years is the tendency toward con-
solidation of banking resources evil
denced by the reduction in the num-
her OF iG1ependent institutions and
the extension of new facilities
Trough the medium of branches and
agencies.
I'm these days of extensive trans
portation facilities and an increas-
ingly complex civilization, banking
of necessity loses much Of the as
pect of local color which attached to
it not many years ago. The invest
ments of the local institutions are
less closely identified and interviewer
with the life of the community i'm
mediatcly served. New conditions
are bringing with them a demand
for variety and degree of banking
service undreamed of a few years
ago and for which the institution
with too limited resources is not
equipped.
"The extent to which this central
izing process has been carried is
evidenced by the fact that where in
the early COS. mutual savings banks
numbered SO, there are but 80 at the
present time, the National banks
having decreased in number from a
maximum of Sc in 1902 to 60 in 1923.
This decrease in number is in nei-
thor case indicative of decreasing
strength, the resources of the saw
ingS banks having increased more
than GO per cent in the last 20 years
and those of the National banks
about $50 per cent.
THE most conspicuous evidence of
this tendency is, of course. the trust
companies, which, from a position OF
comparatively negligible influence at
the opening of the century, have in n
relatively short period of time. in no
small degree through consolidation.
absorption of other institutions and
a system of branches and agencies
taken commanding lead over all
other banking institutions in aggre-
gate resources. Two factors have
evidently contributed to this process,
one the broad scope of charter pow
ers conferred upon them by statute
and the other the privilege of main
tanning branches and agencies, which
is denied both to National banks and
mutual savings bnkS.
at the present time the So trust
companies of Maine are operating 35
| branches and nine agencies, and au-
! thoriZGtion hs been given for two
additional branches shortly to lie
this process has been going on rapid
ly and without any apparent criti-
cism during a period when in many
other sections of the country the
subject of branch banking had been
Il storm center.
Undoubtedly a development Of
this type of banking service should
be regulated in such manner as to
prevent over-devclOpment of top
, heavy banking structure. Chain bank
ing should never be permitted nor
! an extension of the branch system
| to communities able to maintain To-
callY owned and controlled institu-
tons, but Maine is likely to remain
for considerable period of time a
State of small communities, and it
is difficult to see how many of these
communities deserving of banking
facilities can receive them by any
other method.
"On July Z, 1928. the revised bank
ing law, representing for the most
parts the results of the labors of the
special recess committee of the Leg
is!ature, went into effect, and the
practical workings of the most i'm
portant of its provisions are being
watched with great interest. The
thorough going revision of the entire
savings bank investment law is oper-
atirg TO compel diVcrsificatiOn of in
vestment. as well as to open to these
banks excellent Investment oppor-
tunities hitherto denied them, con-
spicuous among which are the high
est grade telephone OBLIGATIONS. rail
road equipment bonds. bonds of the
| Dominion of Canada payable in
United States funds. and broaden
ing of the field of public utility Sc
Curities.
IAN attempt to bring home to dir
ectors OF trust companies a con-
sciousncss of their personal respCn-
sibility found expression in a pro-
vision Of this law requiring the full
board of directors of every trust
company to hold meetings at least
once each month and requiring the
executive boards of all companies.
whose bylaws provide for such
bodies, to make full reports OF their
doings to the directors at each
monthly meeting.
IN the enforcement of this stat
ute / will endeavor to prevent so
far as possible the retention on the
directorate of banks under my su-
pervision all inactive members Sc
lected eff her nS a matter OF DerSOnal