Evening star., 1934-09-18
A. B. A. ATTITUDE
ON SURETY H|NTED
Session Expected to Favor
Continuance of Temporary
Deposits Plan.
BY EDWARD C. STONE.

That the American Bankers As
sociation, while in session here next
month, may go on record favoring
continuance of the temporary plan
for the insuring of bank deposits, is
strongly suggested by the Bankers
Magazine, out today. The bankers
NAV also take further steps to make
banking sounder, while one thing they
are certain not to do is to seek further
Government legislation regulating
their business. In glance at the
coming national session, the magazine
says:
From October % to 25 the Ameri-
can Bankers Association will be hold
ing its annual convention, meeting
this time at Washington. The men,
bership of the organization has been
greatly reduced from its former high
point, this reduction being due chiefly
to the falling off in the number OF
banks.
Although meeting at Washington,
the source of Federal legislation re-
lating to banking, it is hardly to be
expected that the bankers on this
occasion will make demands for fresh
legislation for regulating their busi-
ness. They now have about all the
regulatory laws they can understand
or digest. In fact, some OF the banks
consider that altogether too much
of their attention is now diverted from
ordinary banking problems to the con-
xideration of a multiplicity of laws
and regulations.
Unit Banking Vital Topic.
while the banks are already
surfeited with regulatory statutes, 1t
is too much to expect that Congress
will cease its efforts in this direction.
One subject almost sure to occupy the
attention of that body before long will
be that of bringing all banks under
the control of the Federal Govern
ment This is a matter that has been
widely discussed and about which
opinion has not as yet sufficiently
crystallized to warrant the expecta-
ton of early action by Congress. The
unit or community bank still has too
many supporters to permit of the i'm
mediate surrender of this type of or
ganization, and as the American
Bankers Association has numerous
State banks among its members, 1t is
hardly likely that the washington
convention will approve the unifica-
ton of our two banking systems.
LAS to the deposit guaranty now in
force, it would not be surprising to
see the convention go on record
though with a wry face-in favor of
q continuance of the temporary plan
while expressing strong disapproval
of the permanent plan, thus making
a choice of two evils.
a, Other Timely Problems.
sSsipce there is a prevailing lack of
l1eSfnsthe efficacy of legislation to
ound banking, the question
arises as to what further
bankers themselves might
Ehieve this desirable objective.
APPS it is impracticable to
Mkll4hknembership in the American
Bankers Association an indiSputable
evidence of soundnesS in the banks
holdin(N such membership, for this
wot eall for a degree of super
vision over it's membership impos-
Sible to exercise. Even were such
supervision practicable, it would prob
ably he found that for the American
Bankers Association to set up such
standard of superiority among its
members would give rise to a great
deal of dissatisfaction.
Still, by constantly advocating con-
servative banking principles and prac-
tices, the American Bankers Associa-
ton can do much to advance bank
ing standards in this country" the
magazine concludes.
The complete program will be an
nounced soon from national head
quarters of the A. B. A in New York.
Local bankers believe it will be one
of the most varied, interesting, prac-
tical, and constructive sessions wit
messed in many years. There is
plenty to talk about and some very
lively discussions are anticipated.
Group Banking Opposed.
That group banking has inherent
weaknesses" and dangerous poten-
tialities" is the conclusion reached in
a report of the Senate Committee on
Banking and Currency, released by
the committee chairman, Duncan U.
Fletcher
The report follows hearing on the
collapse in 1888 of two group bank
ing institutions in Detroit, the Guard
ian Detroit Union Group, Inc, and
the Detroit Bankers Co. The report
concludes that their collapse was not
attributable solely to the "constitu-
ency, competency or honesty of the
octi ~
but to the way in which they were
organized.
E The report asserts that during a
period Of prosperity, when public con-
1idence in the unit institutions is
strong the group may prosper, but
that when adversely dislodges conf
pce in any of the units, the entire
Eucture is destined to collapse.
JIpit banks which might otherwise
we survived, the report states, are
Qmed because of their affiliation in
:. public minds with the weaker
Units.
>, Capital Transit Holds Gain.
Capital Transit stock held its gain
on the Washington Stock Exchange
when it sold again today at 261a, the
highest price in several months. Two
sales were recorded. The final bid
was advanced to 261s while the asked
price at the close was again 27.
Capital Traction SIS also were out
today 81 1000 changing ownership at
90. This was the only bond sale of
the session. Potomac Electric Power
per cent preferred stock moved at
Ill, while Washington Railway &
Electric preferred appeared on the
board at 9912. both issues selling
around recent levels. American Tele-
phone stock now is being quoted ex-
dividend