The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-08-23
BANKS WARNED
TO LOOSEN ON
LOAN POLICY
Gen. Johnson Declares That
Caution Is Retarding
Recovery Program.
DEPOSITS ARE FREED
More Money Released, but
Large Sum Still Is
Tied Up.
By THOMAS l.. STOKES
Times Special Writer


WASHINGTON. Aug. %. - The
nations banks were warned bluntly
today that they must do their part
in the recovery program.
They were told by General Hugh
Johnson. NRA administrator. that
they must loosen up on credits to
business and industry Acting upon
numerous protests that banks are
refusing loans. General Johnson
called the stringency of credit to
the attention of the Federal Reserve
board and the Reconstruction
Finance corporation.
Business is on the upward spiral,
the administrator said. but il can
not go forward without bank CO.
operation.
simultaneously, pressure is being
brought upon the treasury TO hasten
release of $1,000 100000 tied I'D in
closed banks.
Deposits Must BE Freed
Fall buying is about to begin.
Prices are going up under the in
dustrial recovery plan. Freeing Of
deposits is regarded as important in
maintaining the advance. Depos.-
tors are becoming testy at the long
delay.
Business men. likewise. are re-
Sentful over reluctance of banks to
provide them with necessary credit
to participate in the recovery plan.
Industry has stocked its shelves and
increased its costs II must have
credit to move its goods.
Swamped with appeals. treasury
officials say they are proceeding as
swiftly as possible under difficulties
TO reopen banks.
Optimism eX1ded today from
Walter j. Cummings, special assist
ant TO Secretary w H. Woodin in
charge of opening banks. who fore
cast that sixty days will see the
reopening of all national banks and
state banks which are members of
the federal reserve system.
897 Banks Closed
or the $500 national banks still
extant. only 897 still are closed. ac-
cording to last-minute figures COM
piled by Cummings A total of
1868 have been reopened. releasing
deposits aggregating $1,000 100000
But the national bank picture is
even better than that. said Cum
mings. While 1877 banks are closed,
plans have been approved for re-
opening BIT of these, leaving only
$50 still locked
OF the 1886 state bands which are
members of the federal reserve sys-
tenn, 95 still are closed.
In the 1877 national banks still
unopened there are $4,000 900 OF
deposits. This will be reduced TO
about $45O,0O0O0O with opening of
the BIT which are about ready TO
function again. he estimated
Still unavailable in the ninety-five
state bank members of the federal
reserve are S204,OQo,O0O of deposits.
Made available by reopening Of
state bank members is a total of
s9,74l 100000.
Cummings Is Optimistic
That looks pretty good TO me"
commented Cummings, who remains
genial and placid despite his wor-
ries. That means that S26,74l.-
100000 has been. released by ma
tlonal and state bank members.
with only 1854 1000 still tied up
Not so much can be said for
state banks which are not members
Of the federal reserve system. or
a total of l0ll6, there are still / 1866
closed, with total deposits of Sl.O05,-
100000. A total Of 1850 have been
reopened, with deposits of s5.O57.-
100000.
The only part the treasury can
play in regard TO. state banks is to
expedite loans from the r. F. c.,
he said
Altogether, total of 1888 banks
have been reopened to date. with
more than $4,000, 900 900 of de-
posts. Still tied up are deposits
amounting to s2.126.O00 900.
Cummings said his policy is to
insist upon double liability for
stockholders. He denied that the
treasury fayors the bankers in its
reorganization plans, complaint
frequently voiced
we are for the depositors, he
insisted.