Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1924-12-02
WANTS NATIONAL
BANKING ON even
TERMS WITH OTHERS

UHtyklUO UN lvIN
Terms WITH OTHERS
Washington. Dec. Tho claims
OF the national banking system Of
the country for legislative consider
alton placing them on even terms
with other financial institutions
were laid before Congress today in
the annual report Of Comptroller
Dawes, OF the Currency.
Mr.. Dawes declared that the dis
parity between the position Of ma
tiopal banks and state and private
banks and other financial institu-
lions must be removed through more
liberal treatment Of the national iu-
situations and by according them
more privileges from the govern
ment. Only through granting them
such powers as he recommended IN
his report, he believed. could they
check a waning OF their influence
and strength.
The Comptroller mentioned that
twice in the history of this govern
ment the national banks had proved
the vehicle for the nations war
time fiscal operations, and that In
each case their operations were
larger than anything about which
tire world had known prior to their
War. he added. no other govern
mental instrumentality rendered q
more effective service.
The function which the Federal
Reserve System performed in the
fiscal operations of the government
during and after the world war in
history and not theory. the Comp
troller said, IF the national banks
should go out of existence. the
Federal reserve system would be-
come entirely a voluntary system;
it would be little more than a loose
aggregation of banking powers,
without conference, without disci-
pline, and not subject to Federal
authority. Its members would be
subject TO the laws of 4S different
take the place of legal control as
the only means by which the gov
ernment's influence could be. exerted.
Even If it were assumed that such n
loosely controlled :. system would
function under normal conditions,
It would cease to be great machine
ready on q moments notice to meet
the nations need In a time of crisis.
1.-THE national banks afford n
strong, aggressive, and permanent
membership; they have resources of
over $23,000,0 100000; they comprise
units ranging in size from the
largest banking aggregations in the
world to neighborhood institutions
for the service of small and remote
communities, and it Is unthinkable
no 1T ,rN,
neglect, the government of the
United States should permit the dis
solution of such an institution or
lose its control over II.
1T should never be forgotten
that when the Federal reserve sys-
tenn was formed the national banks
were not invited to join-they We're
forced to become members. Having
thus been brought in by compulsion,
the government Is in duty bound to
treat them with fairness or suffer
the consequences Of the surrender of
their charters.
IF. at the expiration of the
charters of the Federal reserve
banks. Congress for any reason
should not recharter these banks,
and If at that, time the national
banking system had gone out of
SAAoiCASCs lllO ISucldi
would have lost all direct control
over banking"
Mr.. Dawes cited records showing
that years ago the national banks
had IS percent of the total banking
resources of the country while their
combined force today represents
only Al percent of the total. Since
1918. he adde, 2Vs national banks.
each with capital of 100000
or over. have surrendered their ma
tional charters to re-enter business
under state laws and they carried
with them total assets of more than
two and n quarter billion dollars.
Resources of the national banks
October 10 last, he said. were $23.-
323,061,0 900, a sum substantially
greater than at any time in the last
four years. but their growth has
not kept pace with that of insti-
buttons operating under state laws.
To the end that the national
banks may recover some of the
ground lost. in comparison with
state and private banks. Mr.. Dawes
recommended to Congress the fol-
lowing changes in the national
banking and reserve acts.
Elimination of the date of charter
expiration, making the charter
rights perpetual.
Permission for the issuing of
charters to national banks in a city
Of $4,000 or more with a capital of
100000.
Codiication and Qualification of
provisions establishing a legal loan
limit to one person.
Amendment of the Federal Re
serve Act to permit national banks
to make loans on improved city real
estate for term Of five years in
stead of the present one year basis.
Revision of the discount limita-
tons which force the Withholding of
certain classes Of paper from redis-
count with the Federal Reserve
Banks.
Authority for thesmore liberal use
of stock dividends.
Enactment Of the Pepper McFad-
den bill.
The granting of express authority
for operation of safe deposit divis-
ions.
The Comptroller gave the total
banking resources of the country. as
represented by>29,360 banks, includ-
ing the IL reserve banks. as s61,935,
05S,000. @pne 80. 1924. This shows a
gain of nearly three billion dollars
over the same date a year ago. The
loans apd discounts OF these banks
were $51,S22. 1882 900, or gain Of
$3.50 900. 900 over the corresDopdfnp