The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-04-01
BANKER FAVORs
INCREASED
INTEREST
Charles E. Mitchell, President
Of National city Bank, Opens
Compound interest Dept:
BY w. s. COUSINS.

Copyright, 1924, by Cosmopolitan
News service.)
NEW YORK.. April 1.-THE big
gest banking institution in America
has capitalized the two most at
tractive words to patrons Of saw
ings hanks, and, under the designa-
ton Of compound interest depart
ment, has developed large and
flourishing department for small
and large savings. in which the
interests Of 10000 people are CEN
tered today.
MitcheII's Idea.
This was but 6ne Of the innova.
tons introduced into eastern big.
town banking by Charles z. Mitchell
when he superseded the Stillmans
as head Of the National City Bank
Of New York, with resources close
to a billion dollars. 1t was a tri.
umph for Mitchell personally, a
profitable venture for the bank, and
a great convenience for thousands
OF depOsitbrs who make the COM
pound interest department the first
step to the utilization of the many
facilities OF metropolitan bank.
Big bankers in Chicago and other
monetary centers, which do not
legaiize mutual savings banks, have
long since inaugurated the glad.
hand" policy Tor the man with only
one dollar to start an account, and
they are fully cognizant Of its bene-
fits.
I'VE are very well satisfied with
our experiment with savings de.
posits," an officer of the National
City Bank said today. 1--WE bid
aggressively for accounts az low as
u, though interest is paid only
on accounts OF IS, or more. There
Is no limit to the amount which
any deposition, may add to his ac-
count at any one time, and we will
accept 100000 on the same terms
as $40. This often proves a great
convenience to a business man.
who wishes to keep an amount OF
money liquid for a few weeks or
months in order to meet pending
obligations"
Equals 4 Per Cent. :.
The interest rate Of 8 per cent
compounded monthly, though ap-
pealing to depositors, who habitual-
ly make withdrawal of part Of their
savings, is about equivalent in cost
10 the bank as the 4 per cent rate.
with losses on withdrawals, to the
savings banks. To the depositor
who Is ambitious to add steadily to
his account, and who makes in.
frequent Withdrawals the savings
bank paying 4 per cent is far
more preferable than the g per
cent commercial savings depart
ment.
Statistics show that about 30 per
cent OF the general savings deposits
are closed out in the first year,
and thousands of these accounts
draw no interest from banks be-
cause they do not remain the re-
quired six months or full quarter.
These floating accounts 1t is
inquired, cost the banks about 2.65
per cent interest, against posted
rates OF Sh to AZ per cent.
The per cent rate, compounded
monthly, nets permanent depositors
about sos per cent on actual
amount Of money on deposit, in
GLIDING accruals from month to
month. The Y per cent rate, COM
pounded quarterly, amounts to
4.OSO2. and compounded semi.
annually, 400 per cent. On the
former basis. an account entered
on January 9Th and withdrawn
March 20, would command two full
months interest. Like most bust
ness transactions, you get what
you pay for" and q man should
choose the system that is most
advantageous to him in his par.
ticular circumstances.
The compound interest depart
ment," said Charles e. Mitchell.
president Of the National CITY
Bank, has justified it's establish
ment. Total deposits last year
showed an increase of 272 per
cent. 1t has become excellent
feeder for the other departments
OF the institution, particularly the
bond department and the safety
deposit department"