Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-08-01
BY I. A. FLEMING.

".
turers' Association, would proffer the
credit service of that organization as
an aid to the bankers, but so far as
known It's aid was never solicited.
Probably the petty jealousies be.
tween bankers. as they existed l0
years ago, the indisposition to CIV
ingN infOrmation to a competitor, was
the reason no attempt was made to
start a credit bureau.
Now, however, conditions have
changed, bitter competition has given
place to cooperation and DISPOSE
ton to aid one another at the ex-
pense of fraud.
It is probable that the current year
may see the bankers credit associa-
ton in active operation, with prac-
tically every bank in the city in full
harmony and sympathy with the
movement and benefiting from 1t.
Today it Is possible for one bank
TO obtain information from another
regarding an applicant for credit ac-
commodation, provided the bank in.
terrogated is in a position to supply II.
Harry V. Haynes, president Of the
Farmers and Mechanics National
IaBank Of Georgetown, and Victor -
Deyber, president Of the Second Ma
ttonal Bank, propose, to give the mat
ter their closest attention in an e1-
fort to get the bureau underway De
fore the exodus Of many bankers 10
the A, b. A. convention this FAN.
VIII Cover the City.
II is the intention to include all
borrowers at banks in the organiza-
tons reports, so that any bank may
know at a short notice the response
bility of a borrower, whether extend
ed as TO credit in other institutions,
etc.
At the present time every bank
| keeps it's own credit files, ana VIII
| nrobablv continue to do so right
along.
| Every bank asks merchants, manu-
facturers etc. In filing application
| for a credit line, to furnish state
ment Of actual condition.
| These statements are prepared on
| forms which set forth In detail the
| assets and liabilities of the applicants
| including stocks, accounts receiVapie'
notes and acceptances OUTSTANDING
accounts and notes receivable, cash
| In hank. real estate owned, furniture
and fixtures. annual net income. sal
aries maid. bad debts charged on. net
| nrofit etc, for q stated fiscal year;
| in fact, a digest of actual condition,
| in proper form, assets on one slde
and liabilities on the other.
In addition. there are number OF
other questions that are asked, 10
wit insurance carried, mortgages
| owned and their character, intor1na'
| ton on indorsers of firm or corpora
ton paper. full list OF BORROWINGS y.
/ ether banks, etc, all OF which the
would be borrower Is supposed to fur-
nish as a basis on which his credits
are granted. -,
! The collateral borrower avoids ali
| this He is very welcome at all the
| hanks and trust companies. Ihefe
| Is usually a market for the sale OF
his collateral Immediately and an es'
| tablished value. so that there is no
risk In lending on collateral, Wnere
| the bank knows both the collateral
and the borrower-that the FORMER ~ -
marketable at a price and that II Is
not part of a looting expedition.
Changing Methods.
Formerly the trust companies OF
the city made no loans unless Sc
| cured by collateral or real estate
mortgages, the great majority OF then
notes being secured by real estate
trusts. invariably first trusts.
| The acquisition of the Home SAY
ings Bank by the American Security
| q Trust Co. gave the latter large
line of commercial accounts. Or late
the washington Loan & Trust Co. has
expressed a readiness to do business
| with merchants and the Merchants
Rank & Trust Co. has line OF com
mercial accounts.
1t is probable that the Union Irus,
Co. and the National Savings & Trus'
%, are the only banks in this grouT
that stick closely to the old-time eXclu
| onIIofara1 loans.
The Munsey Trust Co. and the Con
tinental Trust Co. probably carry
business accounts.
Banks Check up Statements.
Naturally the banks do not accept
oil statements furnished by would-be
borrowers without investigation. In
90 far as II is possible they check Ut
with other banks, both in and out OF
the city.
A statement doctored by the maker
RI chow larger assets than actually
possessed would make the slgner ma
BILE for obtaining money under raise
nretenses and this in itself prevents
| many exaggerations.
An.effort will be made to ilst IN tne
credit bureau all borrowers Wnethei
in business, professional men ano
women as well as Government EN-
|
those that never rent money from 1ie
nlaces where they keep 1t to let.
In one respect the credit service o.
the Merchants and Manufacturers
Association will be of great value U
the bankers, and that is in checking
personal credits of this city. Iol
washington, as a credit center, Is ont
of the most generous in it's treatmen
of borrowers.
Changes in Bankruptcy Law.
Tnnortant changes in the nauona
J bankruptcy law, passed by Congress
Nav 10 and signed by the Presiden
Nav % will become effective WITT
August 81 of this year.
The American Institute OF Ac
co,Intants describes the changes II
the law-referring also to the minol
changes in the present law. thaI y
1898 as unimportant, up 70 the iaeeS S,
amendments, calculated TO- cur
crooks and to aid honest DankTupes
1rhe present law is said to be LACKING
=, criminal provisions; it does no
nreyent collision by friendly or nc
titious creditors at the request OF tn'
debtor: it permits fraudulent compo
sitions and easy discharges IRON
bankruptcy. ~,
Nearly all the objections and I'LL
! will be prevented by the new genera
orders in bankruptcy by the Unitee
states Supreme Court and I'M
. amended law. C.,
"a new general order OF the ou
creme Court requires that pettionel
8 in involuntary cases, whose .clal ...
have been obtained by assignment
I make AFFIDAVIT as to the considerable,
paid for the assigned claims. AS CO.
] iusive petitions usually rest on @
] signed claims, this new order ma.
eliminate this evil. Another orde
prohibits the employment by receiver
! and trustees of attorneys who are =
any way connected with the bankrupl
"a section in the amended law pre-
1 -. f,.f.vN