Evening star., 1933-09-10
National Association Pledges
! Support to President in
Recovery Drive.
BITTER ATTACKS MADE
ON INSURING DEPOSITS
New Code Expected to Help Bank.
ing Profts-Next A. B. A.
Convention in Washington.
BY EDWARD C. STONE.

BY EDWARD e. STONE.
Washington bankers. home from
Chicago yesterday, characterized the
annual convention Of the American
Bankers Association as one of the
most constructive, interesting, out
spoken and practical sessions ever held
No convention was ever more timely
or the issues at stake more vital. The
bankers differed materially in some
ways with the Governments banking
policies, yet pledged fullest cooperation
in the national recovery drive.
The guaranteeing of bank deposits
which Is included in the new Glass
Steagall banking bill. was the target
for many bitter attacks during the ses-
sion. It was the most vital question
discussed and caused the most heated
statements. The convention has asked
that the initiation of deposit insur-
ance be postponed until adequate
study and report can be made on its
probable results, particularly on banks
which could not qualify for such
insurance"
Statements made by Jesse H. Jones.
chairman of the Reconstruction
Finance Corporation, before the con-
vertion indicate, however. that the new
law will go partially into effect on
January l. He said that if any bank
ers thought the next Congress would
emend the law, they did not know
their Congress. " He then called at
tention to the fact that the bill was
passed almost unanimously. In his
opinion there is an almost universal
demand for the deposit insurance
guarantee. No "armistice" in the fight
is r0Ssihle he believes
Blacks Speech Reassuring.
Gov. Eugene R. Black of the Fed
eral Reserve Board made a brilliant
speech which was considered as re-
assuring. although he told the Nations
bankers that they must accept the law
as passed, whether they liked it or
not" He followed Jesse Jones and in
dicated that he did not wholly agree
with some of the things Jones had said.
Gov. Black also expressed his own
doubts about the wisdom of some of
the recent banking legislation. But
program, he declared in no uncertain
terms.
The bankers listened closely as he
reviewed recent economic and banking
history to prove, as he said, that I'VE
are in new era. If you don't ike
that term, change the term but the
new era is here" he said The banks
and the Federal Reserve Board" he
added, must realize that they are op-
Grating under conditions never existant
before, and with forces that are new
and controlling, and if they are to sue
ceed, they must accord themselves with
these conditions and with these forces"
Turning to the guarantee of deposits
act, Gov. Black poured little oil on
the troubled waters by stating that "In
my opinion 1t is not going to be so ter
rible as you fear" The success or fall
ure of the plan must depend on the
quality of enforcement, he asserted,
and noted the fact that bankers had
opposed the Federal Reserve act when
1t was enacted.
"If it is administered ably and hon.
estly as I deem it will be" he declared,
''it should be a menace to no bank or
group of banks and protective mea-
sure to all banks.
Expects Minimum Of Losses.
"The law fixes the condition Of mem.
bership upon the possession by each
applying bank Of assets adequate to
meet its liabilities to depositors and
other creditors. In fairness to each
member of the fund. no bank should be
admitted to membership unless its
assets meet this requirement.:
with this condition applied, losses
in the corporation should be held at
minimum and this condition must be
applied If the corporation Is to succeed.
With this condition applied, such mini
mum losses will be small price to pay
for the sound unified banking system
that should follow from its operation by
July l, 1886.
Il can only speak for the board, and
for it I am free to pledge you that
banks admitted by it into this corpora
tion will comply with the required con-
dition. And I have faith that the other
agencies passing upon the question wiz
exercise the same degree Of integrity.
The address of Controller of the Cur
rency j. F. T. O'Connor, along the same
lines already full reported, also was
conservative. He hinted plainly at a
broad Interpretation of the law.
Sunshine in Banking Picture.
The N. r. A. banking code also re-
ceived special attention at Chicago. The
provisions will be published in October.
Bankers will be permitted to make all
the suggestions they desire.
The new code, of course, will regu-
late hours of work in the banks. hours
of opening and closing and host OF
other details of operation. 1t also Is
expected that the code will permit
the applying of many service charges
which are not now In use. It Is quite
probable that charge Tor the collec-
ton Of checks on out-of-town banKs
will be included. Charges Tor other
services. now free, will materially add
to bank profits.
It is even expected that by these in
novations banks may make consider
ably more money in the future on re-
duced deposits Discussions along these
lines brought a lot of cheer to- the
inanciers in Chicago Full details OF
the code will be awaited with keenest
interest all over the country. =.
The question Of greater expansion OF
credit for business and industry, as re-
uuested in a telegraphic statement
from President Roosevelt. was given
careful attention. Banks having plenty
of money are glad to make sound loans;
President sisson said. but ne opposea pp
other loans as unwise even to help
business. The bankers, however, WILL
ingly agreed to help expand credit just
as far as possible.
Capital Bankers Satisfied.
Washington bankers express complete
satisfaction with the convention. They
heard the best methods of meeting
present problems discussed most intelli-
gently. Practical suggestions were
made galore.
More than that, the next convention
will be held in Washington as a result
Of an invitation from the District Bank
ers' Association. The invitation was
Continued on Second Page.)