The Carbon County news., 1930-01-30
BANKERS find Group
BANKING Widespread
Over l3 Billion Dollars OF Bank
Assets in Affiliated Systems
Numbering 1850 Members
In Nearly Every State.

Over 1850 banks with more than
thirteen billion dollars in resources
are shown to be associated with chain
or group banking systems in the
United States in facts recently gath
cred by the Economic Policy Commits
sion of the American Bankers Asso-
citation. The chairman of the COM
mission, r. s. Hecht of New Orleans,
pointed out that the facts indicate that
almost ia per cent of our banks and
over Is per cent of our banking re-
sources are in the great net of group
or chain banking that now covers al
most every part of the country"
The commissions facts comprised
chain and group banking affiliations in
the broadest sense Of the term, the re-
port said. They included those groups
in which the controlling element was
particular bank, there being report
ed 7S instances Of this class involving
407 banks and about s6,473,000,000 in
combined banking resources. They
included also groups in which a nom
banking holding company, not sub
sidiary to any particular bank, was in
control and of this class 2S instances
were found, involving $50 banks and
nearly s5,335, 100000 in resources. The
report also included groupings in
which control was exercised by in
dfui1tta1 nd
bered 167, involving 1911 banks and
about 81 1,4eS,e00,000 in assets.
The Total Figures
The total was over $13,275, 200, 900 in
aggregate resources. Some Of the sys-
TENS comprised 80 to 100 banks each.
Head offices of the groups were found
in all jurisdictions, but nine of the
states and the District Of Columbia.
I'VE have not included in these fig
ures," the report says, banking
groups in which commercial bank, a
trust company and an investment
house, and sometimes savings bank,
are tied together by some form of
stock holdings and operated as com
Elementary elements in an organiza-
tion rendering complete financial serv-
ices. We have held that such groups
are similar to epartmentalized bank
and different in the purposes and op-
erations from a chain or group bank
ing system.
For purposes Of the present report
we define chain or group banks as sys-
TENS in which centralized control,
whether corporate or personal and
either rigid or informal, directs the
operations of two or more complete
banks, not functionally complement
tary, each working on its own capital
and under its own personnel and 10
Gated in one or more cities or states"
Commenting on the question wheth-
er the rapid development of chain
banking was in the nature of reac-
tion against restrictions imposed on
branch banking by the banking laws
in many states the report says that
observation does not wholly confirm
this theory since chain banking is
prevalent in sc me states where vir-
tually no restriction is imposed on
branch banking, as well as in those
where the establishment Of branch
banks is prohibited. 1t adds:
The Question of Branch Banking
However, the facts do show that
anti-branch banking laws have been q
factor in some cases, and probably in
some sections, in the spread Of chain
banking. Instances have come to our
attention where expansion along chain
bank lines has been carried out by
state banks whose expansion along
branch bank lines was stopped by the
passing of state laws prohibiting fur
ther branches. Yet whether expansion
would have been along branch bank
lines If the laws had imposed no bar
riers, 1t is impossible to say. There
Is obviously well developed banking
opinion in some sections that the chain
bank method brings to outlying banks
the strength and efficiency of big
organization without depriving them
Of their local individuality and sympa-
thies. In view Of the mixed factors
noted, we feel it is unsafe to general
ize as to what bearing branch banking
laws have on chain developments.
1.-THE recent era of rapid chain bank
developments has found specific re-
Election in some state legislative ac-
tion tending to restrict or control
chain or group banking. Also we find
a sharp difference of opinion among
state bank commissioners who have
expressed their sentiments regarding
chain banking"
In foreword to the report, issued
in booklet form by the association at
it's New York City headquarters,
Chairman Heoht says that "the Eco
nomic Policy Commission does not
take a stand in advocacy Of or in op-
position to this new method Of con-
centrating banking resources through
the affiliation of banks into groups and
chains, but is simply Offering as fact
finding body what we believe is the
first complete national picture of this
rapidly growing movement"