Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-05-20
WALLACE CAUTIONS |
MUTUAL BANKERS
President Says Field Is One
of Few Unhurt by Bust
ness Conditions.
BY EDWARD C. STONE.

hI EDWARD T.. SIONE.
Thomas =. Wallace president Of tn,
National Association of Mutual Saving
Banks and president of the Farmers
Mechanics Savings Bank Of Mime
apolis, opened the organizations elev
enth annual convention at the May
flower Hotel early this afternoon b!
responsibility placed upon bank Official
because Of the immense amount o
money now flowing into the saving
institutions vaults. The savings banl
business is about the only business II
the United States that has not suffered
from the depression. he declared, ant
it Is the care of this new inflow of funds
that greater safety than ever Is re-
quired.
More than 900 delegates from al
parts of the country were present wher
the gavel fell and the proceedings
started. A special train brought ar
extra large delegation from New Eng
land. one of the great mutual saving:
bank centers of the country. From
every other point of the compass cam'
custodians of deposits belonging II
$4,000, 900 people in II States.
The savings bankers are in agreement
that the great total of small capital IN
their hands will 60 far to provide 6
basis for business recovery and pros
perity. The arc OF savings and thrift i
still rising, they report, showing little, il
any, signs of slackening.
President Urges Sober Thought.
President Wallace in his opening re-
marks stated that this has been 9
period of defiation and depression fol-
nearly every line of business with the
exception of the savings bank business
which has not seen such a record inf1ov
3D. fntA Nncf-
World War period. This influx Of
money coming at a time when every
class Of securities should receive the
closest scrutiny and when interest re-
turns are at q low rate while suoJect
of congTatulation, should also be
matter for our most sober thought, Tor
Of those to whom much Is given much
is required, and we cannot anord 70
consider lightly the stewardship OF the
savings deposits intrusted TO our care.
Savings banks and savings de-
pogitors," he continued, Should unite
in an irsistent and positive demand that
the legislative bodies Of our respective
States and Congress enact such legis-
lation as will compel the segregation OF
savings and commercial deposits.
II would call your attention to the
fact that during the 10-year period, 1921
to 1881. about 5000 commercial banks
failed, or about 20 per cent. In the
same period but two mutual savings
hanks have failed These figures are
given not by way OF disparagement OF
the commercial bank or In criticism OF
its way of doing business, but to empha-
size the fact that the two operate In
entirely distinct fields in the banking
world.
Savings Bank Field Invaded.
"The invasion Of the savings bank
field by commercial banks and trust
companies while now an accomplished
fact, was never justifiable from sound
economic standpoint, unless accompa-
MED by legislation which would give to
savings deposits in all such institutions
the same protection that depositors IN
mutual savings banks now have.
Recent failures of commercial banks
in New York and other Of our large
cities brought TO light the glaring de-
fects of the present system, system
which in most cases resulted in the saw
ings depositors in these banks being
left with the banks most unrealizable
assets as their only source Of payment
Gov. Roosevelt of New York made
a strong appeal this year to the legis-
lature of that State to remedy this sit
uation by requiring commercial banks
TO segregate their savings accounts, and
while no action was taken, 1t Is hoped
that the publicity that has thus been
the near future.
Big Increases In Assets.
%Our marvellous record of stability
since October, 1929, has not bsen an
nounced by glaring headlines in tho
daily press, nor proclaimed by politica
orators, but that it has nevertheless be-
come known in the homes of the grea'
middle class which constitute the very
backbone Of our country, morally, po'
litically and financially, Is shown b!
the fact that in 1880 the assets o.
mutual savings banks increased by more
than $3.50, 900 900 20 an an-time peal
on January /, 1881.
That this was not the result Of panic
or hysterta." President Wallace added
is evidenced by the amazingly large In
crease in savings deposits in mutua
banks in the State Of New York during
the FIRST three months Of this year, to.
falling S226,14I .803. This was within
Is per cent Of the total gain in say
ings deposits in all banks and trus
companies In the United States for thu
whole year ending June, 1890.
We can look back over more thar
. century of continuous growth in Thu
suits achieved have fully justified oul
existence. But even more important
than this in an intensely class con.
sciouS and class antagontstic period II
our country's history. mutual saving!
banks stand forth as successful, intelli'
gent and painstsking guardians Of TIT
savings OF the masses untainted b.
any suspicion OF selfish gain, and 81
form an immcvable barrier TO the ar
rayal Of class against class" the asso'
citation said In conclusion.
Julius Barnes First Speaker.
julius H. Barnes, chairman OF thu
Board Of the Chamber OF Commerce o.
the United States. was the first speaker
on the program. He addressed the dele.
gates on General Business and The
Mutual Savings Banks" Mr.. Barne
has made an intensive study of tn
business situation ever since the stool
market break and the beginning of thu
depression. He presented some i'm
portant data which has been obtainet
by the Chamber Of Commerce, tn
address Of the former wheat king
being heard with unusual interest
The next speaker was Matthew VOL
vice president of the American Fedora
ton OF Labor, who spoke on Labor ant
the Savings Banks" Mr. Vol discussed
the wage situation in detail. declares
that labor needs the savings banks ant
has found them most USEFUL curing tn
depression. He said in part
Il know Of no more dramatic expert
ence in the history Of American fnanc
than that the depositors in mutual say
ings banks. largely the laboring people
have grown TO the enormous army o
$4,000 900 persons and that their de
posits aggregated se.464, 1877 4s2 as o
January ]. 1891.
Were we wrong In our idea and con
viction that by increasing PURCHASING
power of labor we could increase bust
nesS7 hold not Unquestionably W