Carolina watchman. [volume] (Salisbury, N.C.) 1871-1937, 1933-12-29
1000 Banks Are
Ready For The
New Insurance
: -
II embormNFedera Deposit hrsnr-
auce viii Insure Amounts Up
to $4,000 Until July /.

~depositors Of whom all too many
have suffered losses in bank failures
during the last decade.
This experiment is authorized by
Congress under the terms of the
, Glass-Steagall act, approved at the
last session of Congress. 1t provides
fer a federal deposit insurance COT:
poraticn. The purpose of this a.
-gency will be to safeguard the as
sets of national banks which have
been closed and the assets of state
banks which are members of the
Federal Reserve System. 1t also
will insure the deposits of all banks
entitled to the benuefits of insur-
ance under. the act.
The temporary federal deposit
insurance fund will insure bank de-
posts up to $4,000 from the be-
ginning of the new year until the
new fiscal year begins on July i,
1884.
On the latter date, the perman-
en1 provisions of the Glass-Steagall
act go into effect. Under these
provisions one hundred fifty million
dollars will be appropriated from
the Treasury to pay for the capital
stock of the federal deposit insural,-
&c corporation.
Every bank which is or which
becomes a member of the Federal
Reserve System on or befor July
l, 1884, is required to take all the
steps necessary to become a Class
A s~tockholder of The deposit insur-
ance corporation.
Member banks will hold Class A
stock that will be authorized to pay
dividends out of net earnings.
Only Federal Reserve Banks will
hold Class B stock, and these will
not be entitled to any payment of
dividend.
Banks which are members Of the
Federal Reserve SYSTEM will be re-
quired to apply to the federal de-
; post insurance corporation for
ClassA stock in an amount equal
to one-hgf of 1 per cent Of their
total deposit liabilities.
The new law requires that the
banks must be thoroughly examin-
ed to determine the adequacy Of the
assets of the bank to meet all of. its
liabilities to depositors and other
creditors.
More than 1000 banks have al
ready been examined under the de-
post insurance provisions of the
new law, and the examination will
be completed as rapidly as it can be
conducted effectively.
After July i, 1884, when the
permanent deposit insurance plan
, goes into effect, the following class
es will apply to deposits in banks
insured Under this plan. :.
One hundred per cent insurance
on deposits not exceeding 10000,
Is per Dent, of the amount, if any,
which EXCEEDS $4,000, but dqes
not exceed $4,000, and 50" per
cent of the amount, if any, ,by
which:such sum exceeds $4,000. =.
Senator Fletcher, chairman: of
the Senate, committee on banking,
recently announced that the. deposit
insurance features of the Glass
Stea gall. act will be strengthened At
1.-THE coming session if further ex-
animation shows any weak spot iIn
the existing law.
There. is nothing particularly
new in the protection for bank de-
posts written into the classical
gall act at the last session. Many
bankers have forgotten that when
the Federal. Reserve c passed tho
Senate in.le13 it included a provi-
sion inserted by Senator John Sharp
j.. Williams, of Mississippi, long a
conservative leader of the. Demo
cratic Party, to guarantee bank de-
posts from the profits of the Fed
eral Reserve, System. This provision
was stricken in conference upon the
:. ground that, as the Federal Reserve
System wasin the nature of an ex-;
pertinent, its initial operations
might be embarrassed by including
at the outset the guarantee provi-
= sion proposed by the late Senator
Williams.
For, the last ten years Congress
man Steagall, of Alabama, has
fought hard for federal protection
for bank deposits, and the Roose-
yelt administration is firmly re-
solved to give. the experiment a fair
trial.
Forty All club boys Of Caldwell
County planted Is black walnut