Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-03-22
BANK DEPOS|TORS
: GRASP NEW IDEAS
Savings Conference Is Told
of Greater Competition and
Best Ways to Meet 1t.
BY EDWARD c. STONE.

1QeaS JnaC nave COmpelIeQ DdtlkeIS u
adopt revolutionary changes in deposit
banking to meet the situation, Austin
McLanahan president, savings bank di-
vision, American Bankers Association
president, Savings Bank of Baltimore
told the Eastern regional savings con-
ference in New York, which was at
tended by several local bankers.
20 There has been revolution in de-
post banking he said. Deposits are
free to 60 where they WILL and the
banks now have to supplement safety
with service, and this service has been
expanded to such an extent that it is
quite costly
The point of view of the depositor
has changed He is being urged to put
his money into bonds and stocks, and
because the rate of interest paid in
some sections of the country is over
per cent on savings accounts, he can
only better his return by buying high
yield bonds which have an element OF
danger in them, or he can buy common
or preferred stocks, the latter in some
cases giving very generous yield and
with apparently sufficient safety.
There are also the building and loan
associations paying high rate of inter-
est and engaging in banking and pro-
motion functions, but still enjoying the
tradition of conservatism. Morris plan
banks and other agencies of the sort
have their appeals.
Advantages of Savings Accounts.
After all, what are the advantages
of a savings account over the other
forms of competitive attractions? First
and foremost should be security. The
assets of the bank should be so EN-
ployed as to afford absolute assurance
that the savings accounts are abundant
ly secured as TO their principal and in
terest.
In this connection it may be we'll to
consider whether it is wise, in the long
run, to pay an inadequate return on
your savings accounts. That is being
done In some parts of the country, and
the result may be that the growth in
the savings accounts may be slower
than it would be If higher rate were
paid. The temptation to outsiders to
come in and bid that money away from
you may be detrimental to your institu-
tionS.
Many Emergency Accounts.
THE second advantage the savings
account should have over its competitors
Is that it is always worth par. need
never be sold at discount, and is al
ways available on demand. As matter
OF fact, majority of savings accounts
are not really savings accounts. They
are emergency accounts. Even a rich
man is doing the sensible thing if he
opens savings account for an amount
which shall be available to him when a
many people last Fall thanked their
lucky stars that they had savings or
emergency accounts with which either
to protect their commitments or take
advantage of the bargains that were
available in the bond and stock mar
kets.
In a few instances savings accounts
are really investments Many people of
limited means would rather be sure Of
the safety and integrity of their prin-
cipal and relatively low return than
embark on the, to them, uncharted sea
of investment.
There is another element which
enters into the picture and that is
advice about investments. The adj
vantage at present enjoyed by the
mutual savings banks in this respect is
That they have nothing to sell and in
consequence their advice to their de-
positors or other interested iYiuuirers
IS absolutely diSinterested and you can
appreciate that If you have nothing to
sell your advice can be quite unbiased
by the prospect of profit to YOU" the
banker said
ITO sum up, we are in the era of
voluntary accounts We are experience
ing sharp competition from other agen-
cies which attempt to attract our
possible depositors by the lure of higher
rates and by pretending that the money
placed with them is at all times as
promptly available as it Is in the saw
ings accounts. We offer security, fair
rate OF return, absolute stability of prin-
FfV&al ro0Avy Hst1idffxy
other can match because unbiased"
Heard in Financial District.
The Capital Traction Co. has reported
to the Public Utilities Commission net
income for February of $31, 1882, COM
pared with $35, 1914 in the same month
IN 1929, falling of in revenue of
&4,66472.
Washington banks cleared $27,45s,-
600 this week, against $26, 138,000 last
week. This, however, was a loss in
clearings Of Is per cent when compared
with the corresponding week year ago.
The American Ice Co, which operates
in Washington and five other large
cities, reports for the year ending De-
cember 81, 1929, net profit of $3,43l,-
124. equivalent after preferred require
n1entS, to 1922 a share on the common
stock, compared with 1892 a share on
the common in 1928.
J. Thilman Hendrick, chairman of
the board of Lanston Monotype Co. and
a member of w. b. Hibbs g. Co., has
returned from a trip to New York He
reports that steady strides are being
made toward normal business and gen.
eral prosperity
The safe deposit section of the Dis
trict Bankers Association. Charles E.
Howe chairman, held an important
meeting Thursday afternoon at head
quarters Many matters of timely in
terest were discussed.
Stock Saved for Employees.
Directors of American Stores Co.
were reelected at the annual meeting
in Philadelphia.
4 In reply to questions of stockholders
Samuel Robinson. president of Amert-
increase in treasury stock over the year
1929 was for the purpose of additional
stock offerings to employees from time
/ to time as has been the custom of the
: company in the past.
Concerning the possibility of a
dividend increase, in view of the larger
earnings for the past year. he answered
I that it would not be considered nov be-
cause times are too critical as yet The
: company Is expanding at the present
time, he said. in and around New York
Johnstown and Altoona.
81
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