Evening star., 1933-04-18
BANKERS PROPOSE
REFORM PROGRAM.
Recruiting of Federal Reserve
/ System Urged by Ex-
u ecutive Council.
BY EDWARD c. STONE.

BY EDWARD C. STONE.
A broad program of banking reform
was adopted by the Executive Council
of the American Bankers Association
in session at Augusta, Ga, according to
Robert V. Fleming, president CT the
Riggs National Bank, and E. E. Mount
Joy, Washington representative OF the
American Bankers Association. who
attended the meeting. Both praise the
report of Leonard P. AyreS, vice preSl-
dent of the Cleveland Trust Co, chair
man of the Economic Policy Commission,
which formulated most Ct the proposals,
as one of the highlights CT the meeting.
Among the proposals is one to prlng
banks generally into the Federal Re-
serve system on q broadened basis OF
admission to membership that would
take in numerous State chartered COM
mercial and mutual savings banks not
now in the system.
In discussing the need Of further
coordination of the Federal Reserve
system itself. the report suggests that
perhaps a solution is to be sought IN
the formation of a central bank OF the
United States" of which the present II
independent Federal Reserve banks
would become branches. summary OF
the program approved by the association
Is as follows:
Glass Bill Revision Urged.
l. A revised Glass bill should be en-
acted now and the Federal admlnlstra-
ton should create commission 10
recommend. after mature deliberation,
-, hot eh
in our banking system. in our Federal
Reserve system and in our monetary
system.
2. In order that banks generally may
become members of the Federal Re-
serve system the provisions OF the re-
serve act should be so broadened as
to allow for admission to membership
of numerous State chartered CONNER
cial and mutual savings banks not now
within the system.
3. Provision should be devised against
the independent proclamations OF bank
ing holidays by Governors OF states.
4. Branch banking privileges Shoulo
be unifofm within States for all banks,
whether holding national charters OF
State charters.
5. Reasonable limitations should De
devised to control the sudden shifting
Of large commercial deposits.
Would Curb Speculation.
6. Restraint on real estate specula-
ton would probably prove to be
safeguard to American banking COM
parable to that which would result from
a restriction of speculation IN common
tiles or securities.
7 A Federal commission on banking
legislation should consider regulation
of interest payments on all classes OF
deposits. and of requirements that de-
positors should give notification OF IN
tention to withdraw time deposits.
8. Federal legislation should provld3
for the careful and rigorous regulation
of the granting of loans by banks to
their own officers and directors.
g. AS the general banking system Is
strengthened the postal savings system
should be progressively restricted.
10 Deposits of public funds in banks
should have the same status as private
deposits. and should not be accoroeo
special and additional security.
Other Vital Proposals.
II. A more effective coordination OF
the activities of the Federal Reserve
banks is needed
Il. The present emergency provisions
With respect to member bank borrowing
from the Federal Reserve banks should
be retained as permanent provisions.
49, Consideration should be given to
a possible modification OF the Federal
Reserve act by which the system would
he given power to change the amounts
of member bank reserves required, Tor
this power would afford control over any
threat of dangerous credit imitation
IA Consideration should be given to
~, Reserve
which a minimum required relationship
would be established between our stock
of monetary gold and the combined
total of our Reserve notes and our bank
deposits. This would nullify most OF
the dangers inherent in the boarding OF
currency.
is Expansion of business activity is
our most pressing national need: IL
should be fostered by the national ad-
ministration, by the Federal Reserve
banks, by all commercial banks and by
business men generally.
Present Administration Lauded.
Mr.. Fleming reported that the bank
ers expressed praise OF the present
Washington administration for the
manner in which various angles of the
present economic situation have been
attacked
The business outlook was discussed
at length. The advance is bound to
be gradual in the opinion of most OF
the bankers at the Augusta meeting
Bankers from all over the country eX-
pressed opposition to the guaranteeing
of bank deposits, taking the view that
such a guarantee places too much OF
the cost of bad banking on the shoul-
ders of good banking.
While the president of Riggs gave
great credit to Col. Ayres for his re-
port. Mr. Mountjoy declared that the
report of Mr. Fleming as chairman OF
the \ associations National Legislative
Committee was of equal interest. This
report gave in detail legislative hap
penings in Washington since the ma
tional convention last october.
AT the meeting of the District Bank
ers' Association next Friday Mr.. Flem-
ing will make a complete report to the
local association on the Georgia ses-
sions He. will have considerable to
say on the recent growth in postal
savings and the suggestion that the
postal savings system should permit
checking accounts.
Gas Light Stock Sells at 58.
Ten shares of Washington Gas Light
stock sold at So on the Washington
Stock Exchange today. the first sale
in this issue in long time. Mergen-
thaler sold at % Z. up y. Railway
preferred came out at 817s. Several
bonds sales were also recorded around
recent levels.