The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-03-11
FLOOD OF CASH
is POURED into
NATIONS BANKS
Many Expected to Reopen
Monday; Caution Given
State Institutions.

State Institutions.
Continued From Page Onel
fore their applications will be APP
proved, Secretary of Treasury Will
liam H. Woodin announced.
He authorized state banking COM
missionerS to approve reopenlngs of
state banks and cautioned them
that he expected them to adhere
to this same principle.
Secretary Woodin indicated that
reserve system member banks which
reopen must open up 100 per cent.
This was taken to mean that they
must abandon the percentage with
drawal restrictions which many
banks invoked before the holiday.
To give the banks time to obtain
additional currency before reopen
ing. the twelve central federal re-
serve banks and their branches were
ordered to open today and begin adj
vancing the new currency author
lied under the banking bill passed
Thursday.
Money Rushed to Banks
Bales of the crisp new money al
ready have been rushed to the re-
serve banks from the bureau of en-
craving and printing here. Every
hour Of the day and night the press
eS are turning out additional mil
lions of dollars worth.
Federal reserve member banks i'm
mediately can convert virtually all
their sound assets into this cur
rency. They can get 500 of cur
rency for every 500 of government
obligations which they desire to
pledge with the reserve banks. They
can obtain $50 CT currency for every
$500 of other sound collateral.
Pending reopening of the banks
for full normal business, officials
emphasized they may continue to
release funds for pay roofs, food,
medicine, and other necessary
household expenses, as previously
authorized.
Administration officials felt graft
fed at the spirit in which many
banks were taking advantage Of
these authorizations and easing the
inconvenience Of the holiday on the
public.
officials were graified, too, at
indications of public cooperation
in meeting the emergency. They
noted with satisfaction that mil
lions of dollars worth of gold was
being returned to banks and post
offices.
Thousands Of persons stood in
line in New York and other places
to turn in boarded bullion and gold
pieces.
AS banks reopen, they will be
under injunction to release no funds
for boarding. Evidence of any
boarding will be relayed to the JUS
tice department.
Attorney-General Homer Cum
mings indicated that the depart
ment would be prepared to insti-
tute vigorous action against any one
who violated terms of the Presi-
dents banking DEGREES. The emer-
gency banking act provides a $4,000
fine or two years Imprisonment for
violatorS.
Applications Are ReIayed
To facilitate the mechanical pro-
cess of handling applications for
reopening, all state and national
banks which are members of the
federal reserve system have been
directed to file their requests with
their federal reserve banks.
The applications then are relayed
to the treasury, which has up-to-
the-minute reports on the condition
of all member banks.
Because the treasury lacks data
on non-member state banks. Secre-
tary Woodin has authorized the
forty eight state banking superin-
tendents to direct reopening Of this
class of institutions.
The policy which will govern the
reopenings was laid down by Woodin
as follows:
1T is the intention of the secre-
tary Of the treasury to permit no
federal reserved member bank to
reopen at any time on a full 100 per
cent basis unless or until the secre-
tary is satisfied that such bank is a
sound going institution.
Must Avoid Risks
ANY member bank not clearly
within this category will not be
opened unless or until further in
vestigation discloses that it is
sound, going institution or unless
or until reorganization of some
character will permit the bank so to
be clasSed.
1T is to he expected that state
superintendent in granting licenses
will take under consideration in de-
ternining their own policy the gen.
eral principle to be adopted by the
treasury as respects member banks,
that in the interests Of the deposit
ors and of the country as a whole
only sound institutions will be per-
mitted to carry on all their usual
fnctions, to the end that no bank
shall be reopened for business on
any basis that will run the risk Of
being forced to close again because
Of demands which it is not in posi-
tim To satisfy"