Evening star., 1933-06-10
Morgans' Statement
Banking Firm Calls Lists, Loans and Offerings
Legitimate Bmsiness-Defends Tax
Returns of Members.

frenzied when issued quotat' IN, we
the only possible rule of fair business
dealing.
Not Chosen for Political Standing.
Customers lists. Our lists of private
subscribers were naturally composed OF
men of affairs and position, but they
were selected because of established
business and personal relations, and not
because of any actual or potential polit-
ical relations. We have never had oc-
casion to ask for favors from legislators
or persons in public office nor have we
ever done so. We conduct our business
through no means or measures of "in-
fiuence" or favor. We rely upon such
confidence as our clients and the busi-
ness community generally may repose
in us.
The same is true of our loans to per-
Sonal clients. 1t has never before been
considered wrong to borrow money or
to lend it. Our loans were to men of
high standing against ample security
The unprecedented depreciation in Sc
curities which has since occurred has
caused certain of the borrowers heavy
losses. against which we have created
ample reserves.
1t seems extraordinary that, after 70
years devoted to building up a good
will which has made it true that our
clients are men of affairs and of lead
ership, we should be taken to task for
perfectly sound, honorable and straight
forward business transactions with
them, simply because chance has
brought some of them into high office
and miSchance has impaired the for
tunes of others.
Feel Criticism Deeply.
1t has never during the firms exist
ence been thought discreditable to be
customer of J. p Morgan & Co.,
whether as depositor, borrower or sub
scriber We protested vigorously against
the breach of what we have always
assumed to be the confidential rela-
tionship of the banker and his Gus
toner. The result of this action has
been an unwarranted criticism upon
our customers. This unjust criticism
we feel deeply.
Banking-Our banking business is
our principal business. AS bankers our
first duty is to protect our depositors,
and we do so by keeping ample re-
serve in cash and in United States
Government securities. We do not
mingle investment business and our
banking business, but keep our deposits
separate and fully protected by strictly
banking assets.
We have always disapproved of the
practice of making call loans "for
others" and with the exception of a
few isolated cases have not practiced it.
We have not approved the practice
of indiscriminate competition for de-
Tn
ing House banks and ourselves took the
lead in suggesting that deposit rates be
adjusted in a definite relation to the
Federal Reserve Bank rate. This agree
ment among the clearing house banks
put an end to the wasteful and dan
gerous practice of buying deposits in
competition with one another and no
doubt contributed to the hquidity and
soundneSS of the general banking sit
uation in New York City in these try
ing times.
Ready to Be Examined.
Statements of condition. We have
been in the habit of furnishing a state
ment to the Federal Reserve Bank of
New York since soon after the Federal
Reserve System was organized, and are
ready to be examined by the Federal
Reserve Bank at any time and as often
as my be desired We do not approve
private bankers publishing their state
ments, because such publication tends
to advertisement and solicitation of de-
posits from the general public. But the
question does not greatly interest us one
way or another Our business comes to
us because our depositors, relying upon
banking experience covering more than
three generations, put more faith in our
banking reputation, our resources, and
our methods of doing business than
they put in the work of bank exam
iners, or even in the not always illu-
minating published statements of in
stitutiOns.