Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-06-19
MERGER OF BANKS
HELD BUSINESS AID
by Private Wire
Directs 10 Sta
BiIIion-DoIIar Groups in Max
ing After Recent Big
Consultations.
Special Dispatch to The Star.

special Dispatch TO Inc SBAf'
NEW YORK, June 19-With the
merger of the Chase National Bank
and the Park National Bank announc-
ed yesterday, there are three banking
groups in New York City with indivi-
dual resources ranging from approx
mately $1,750,oo0,000 to $2,00,oo0,o 600.
There is fourth group with resources
approaching $1,000, 900, 900. A few
months ago Chicago announced Its first
Isl 900, 600. 900 bank" Other combina-
tions, in the East and on the PACING
Coast, have brought together institutions
controlling deposits that few years ago
would have been regarded as tremen-
dous even for Americas financial CEN
ter.
Within six months there have been
eight important bank consolidation pro-
grams carried out in this city. Ene
most striking of these has been the mer-
ger of the National City Bank with the
Farmers Loan g. Trust Co, which
brought under one management re-
sources of $4,000 ,O00, 900. OF nearly equal
rank was the combination effected by
the union of the Guaranty Trust Co.
with the Bank of Commerce.
Other Combinations.
IaJeT came LIE VI OaC
Hanover Bank with the Central Trust
Co. and at about the same time the
merger of the Seaboard Bank with the
Equitable Trust Co. The Chemical
Bank and the United States Mortgage
g. Trust Co. joined hands. The Bank
of America introduced a new feature
into banking consultations by taking
over the private banking house OF Blair
g. Co.
1t is significant that q majority of the
eight banking mergers since January
have been between national or State
banks and trust companies. This ar
rangement was of benefit to the bank
that had no trust facilities. It involved
also the absorption of one or the other
of the two units to the merger of a cor
poration specifically functioning in the
field Of originating and distributing
domestic and foreign securities In the
case of the Chase Bank 1t has brought
to the joint control of this second
largest unit in the local banking field
an agency that has been pre-eminent
in a branch of foreign banking, namely
the American Express Co. This last
merger, by the way, involved two
n@tional banks, neither with active trust
company branches though both operat-
ing successful securities corporation.
Involved in the bank mergers of this
year is the prominent element of COM
petition for size between two groups
that have tried to Guido each other in
the matter of total resources. With
this still an incentive, there are likely
to be other alignments before the New
York field is thoroughly combed.
The argument of those who have
been prominent in developing the giant
banking mergers in New York is that
they are necessity in a country that
is rapidlV witnessing consultations of
enormous size in industry and in the
public utility field. Such consultations
have resulted in the establishment of a
number of billion dollar corporations
In the past IL months. They demand
equivalent banking units in order that
they may function successfully.
Can Aid Foreign Trade.
Another advantage claimed for the
big bank is that it can assist the grow
Ing foreign trade of the United States
better than a small bank also. that In
period of such great activity in Sc
curities and with brokers loans now
totaling $500, 900 900 these large ag-
gregations of banking capital will help
to stabilize the money market
Critics of the Federal Reserve Banks are
pointing to the fact that while the dis
counting capacity Of the Federal Re
serve System has not expanded and its
maximum facilities today are no greater
| when the resources of the country were
much less than now, the size of the
banking units has doubled and trebled
In keeping step with developments to
which the Federal Reserve appears to
| be unwilling to respond in the way Of
adjusting its discounting privileges to
| modern business conditions.