Evening star., 1926-03-28
BY EDWARD C. STONE.

banking Dill WAS ldheh rlHuaS, winch
the measure which was passed by the
House on February 4 by vote OF
293 TO so was reported to the Senate
by the Senate banking and currency
committee with amendments. 1t Is
now believed more than likely hat
after the italian debt settlement is out
of the way the Senate will take
this bill up for consideration. The
blll's supporters believe that 1t will be
speedily passed and sent to conference
for an adjustment between the two
houses of Congress.
The principal changes made by the
Senate committee relate TO the SUP
1ect of branch banking. The House
bill would permit national banks IN
those States that authorize branch
banking at the time of the passage
of the bill to have branches within the
corporate limits of the cities in when
they are located. But national banks
located in non-branch bank states
would not be permitted TO take au-
vantage of any branch banking law
uassed after the enactment OF the
bill to the extent OF having Guy
branches.
Provisions of Bill.
The House bill provides that state
hank members of the Federal Reserve
system, NAV have city branches under
the same conditions that nauohal
hanks would be permitted TO nave
CITY branches, and that state oank
members of the Federal reserve sys-
tenn NAV remain in the system ana at
the same time retain such State-Wloe
branches as they may have IN opera
tion at the time of the approVal OF
the bill But State banks that are
NOT members of the Federal Reserve
System would not he permitted 10
come into the system hereafter unless
they relinouish their Statewide
branches.
These branch banking restrictions
are embodied in what are known as
the Hull amendments that were intro
duced TO discourage the further extern
sion of branch banking of any kind.
The Senate committee on banking
and currency has eliminated these
amendments from the bill, so that II
the measure is finally passed as re-
norted by the Senate committee, ma
rional banks would be permitted 70
establish branches in the cities IN
which they are located IN those
states that authorize branch oank-
ing at this time, and if non-orancn
banking state should hereafter enact
a branch banking law, nauonal
banks would be permitted to take
advantage of it to the extent OF nav
ing CITY branches. The same pro
vision would apply to state bank
members of the Federal reserve sys-
ton, and in addition thereto, state
hanks that are not now members OF
the Federal reserve system would oe
nermitted to come into the system
hereafter and bring with them any
hra inches they may have IN eN
istence at the time the McFaduen oill
becomes Il law.
Theory of Amendments.
The theory of the Hull amendments
&c that if national banks and State
hank members of the Federal re-
serve system located in States tnat
do not now authorize branch banking
fnd that even though such states
shouId enact branch banking laws
hereafter they could not take au
va ntage of them, there would be no
incentive for such banks 10 ASK 1Mtate M
Legislatures to pass branch pahhlliS
laws Those who favor the hu,, ii
amendments believe that theF Wlil N
have a tendency to nscouraee sI
further extension OF brahch odIiNlis
oF anv kind. and they were aole 10
,,,.aI,ail nnon the House of Repre-
santatives 10 adopt their views
The senate banking and currency
,,,,,,,,ittee appears to feel dltterently
ohout the limitation imposed by the
TIM amendments. They believe trlat
20 national banks in p states. WheIe
hranch banking is now permltted' az
VI VI o. te allowed to have city branches
rotional hanks located in the othei
oc states should be given equal op'
..ortunitv if and when those States
i,osS branch banking laws. lhey
phiact 10 having the doors or opPol-
t,,y,ity closed forever against city
hranch banking by national odlh"
tha+ are located now in WhaI Is @ i,oil
hranch banking territory. Inc 81
ote committee seems 10 regal ~
business of banking IN ltseii
nurely local or domestic allan r'to w
that the kind of banking that 10 " ~,
on should be deter rilli1loT I. ri, ~
tho people of the several Stdlc9 - IL,
5'aI,a,,n that il is only when pal'ho
oelic .'.,,a ~ create national fiscal sys-
.a,,,s like the national bank system
Celi'"' ~ Federal reserve system
aIio ,.;,,e, loses it's purely local ana 90,
'taItjc a snect and becomes one ol
'.;c,,al innnortance. Therefore, Win
.os,,or+ ia the kind of banking Iha|
,t,ou no carried on, the senate com
,,;ttea believes that due regard silouio
i,n. naid TO the wishes OF the peopLe
nf the several States, and IL old.e
1a,.,,,;ts it's domestic corporations W
~, 49, on branch banking, the ia
t;o-al and state bank members OIL lllo
,1olso ,roao,.oI reserve system. when are
,.,SSor the control of Congress- snoule
~ nermitted to carry on oraiich
banking within city limits
Branches Legally Acquired.
The committee is opposed 10 tne
,r;ncinIe of Statewide brahch ~ Jain
ing within the Federal reselNe ,2, "y9
TEN. but it is not willing 10 pass go %my
80 +bat will require State banks thac
Ia" la" ,1n1v r'l ~, NAV become members OF
- TrodoraI reserve system hereafter
- s,,rrender any Statewide brahcheS
hat we're legally acquired ana are III
,,oration at the time OF the pdsSa
,,f the bill. Thus the Senate ON
would hermit any national pahk ot
S+ota hank member OF the teuei dl
,,acarve system to have city DrancIle9
nroyided the laws OF the Slale -,
,p,,l,;ch such banks are located permlI
branch banking, whether those laws
are i'm e5stence now or are enacted
hereafter; and it would give Stale
hanks that are outside OF the tedetal
reserve system, hut which may desire
10 come in hereafter. the same Ilsnl
TO have Statewide branches as tIoss
state banks that are now members OF
the system enjoy. But no State bank
menher would be permitted to have
any Statewide branches established
after the passage of the bill.
While the House bill would restrict
branches of national banks 10 the
limits of the cities in which they are
located, the Senate bill goes a little
further and permits both national
banks and State bank members OF
the Federal reserve system to estab'