New Britain herald., 1924-12-01
NEARLY 62 BILLION
 BANKS RESOURCES
Comptroller Reports on Nations
 Financial Institutions

| troller Dawes, Of the currency.
 Mir. Dawes declared that the dis parity between the position of na- tional banks and state and private banks and other financial institu- tions must be removed through more liberal treatment of the na- tional Institutions and by accord ing them more privileges from the government. Only through granting them such powers as he recom- mended 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 gov ernment the national banks had proved the vehicle for the nations wartime fiscal operations, and that in each case their operations were larger than anything about which the world had known prior to their successful conclusion. In the Civil war, he added, no other govern mental instrumentality rendered & more effective service.
 Functions Well
 "The function which the federal reserve system performed in the fiscal operations Of the government during and afSer the World war is history and not theory" the comp troller said. If the national banks 1 should go out of existence, the fed eral reserve system would become entirely a voluntary system; 1t | would be little more than a loose aggregation of banking powers, without discipline, and not sub iect to federal authority, Its mem bers would be subject to the laws of 4s different states, and moral suasion would take the place of legal control as the only means by which the governmen influence could be exerted. Even If 1t were assumed that such a loosely con trolled system would function un- der normal conditions, 1t would cease to be a great machine ready on a moments notice to meet the nations need in time of crisis:
 The national banks afford a strong. aggressive, and permanent membership; they have resources Of over s23,000,ooo,o00: they con- prise units ranging in size from the largest banking aggregations in the world 10 neighborhood institutions for the service Of small and remote communities, and it is nnthinkable that, either through direct act or neglect, the government Of the tinted States should permit the dissolution of such an institution or lose its control over it.
 "1t should never be forgotten that when the federal reserve sys- ten was formed the national banks were not invited 10 join -- they were forced 10 become members Having thus been brought in by compusion, the government is IT duty bound 10 treat them with fair ness or suffer the consequences oi the surrender Of their charters.
 If at the expiration of the char ters Of the federal reserve banks Congress for any reason should moi recharter these banks, and If al that time the national banking sys' tenn had gone out of existence, tho federal government would have los' all direct control over banking"
 Records of 40 Years
 Mir. Dawes cited records showing that 4o years ago the national banks had 76 per cent Of the total banking resources of the country while theil combined force today represents only 47 per cent of the total. Since 1918, he added. 2o6 national bank' each with a capital Of T00,oOO ol over, have surrendered their na tional charters 10 re-enter business under state laws and they carried with them total assets Of more thar two and a quarter billion dollars,
 Resources of the national bank October 10 last, he said, were s25, S.3,0sl,00o. sum substantiall! greater than at any time in th' last four years, but their growtt has not kept pace with that of in stitutions operating under stat laws.
 : lowing changes in the nationa banks may recover some of tn ground lost, in comparison witt state and private banks, MT. Dawe recommended to Congress the fol lowing changes in int nationa ]. banking and reserve acts:
 Elimination Of the date of char ter expiration, making the charte rights perpetual
 { Permission for the issuing 0 = charters to national banks in a cit, - Of 5O,OO0 or more with a capital 0 $lOO,Ooo.
 0 Codifcation and clarifcation 0 = provisions establishing legal loa = limit to one person.
 0 Amendment Of the Federal Re { serve Act to permit national bank { to make loans on improved cit real estate for a term of five year = instead of the present one yea basis,
 Revision Of the discount limita tions which force the withholdin ' Of certain classes Of paper tror r rcdisCount with the federal rcserV 2 banks.
 . Authority for the more libers