Evening star., 1934-10-24
EASING Of CREDIT
BY BANKS IS URGED
BY JESSE JONES
R. F. c. Chairman Tells Con-
vention Bankers Demand
Too Much Liquidity.
MORE U. S. LENDING
SEEN AS ALTERNATIVE
Single Examination by All Agen-
cies Is Recommendations
welt Speaks Tonight.

Bankers are going to have to lib
eralize credit to aid recovery, accord
ing to Jesse H. Jones. chairman OF
the Reconstruction Finance Coro
Jones sounded this note in an ad-
dress before the sixtieth annual con-
vention of the American Bankers
Association. By implication he took
issue with the often-repeated asser-
ton of banking leaders that there is
no dearth of credit, but that the
demand for money is lacking due to
fears of business men over what the
future may hold.
Bankers, Jones said. are insisting
on too much liquidity when, as a mat
ter of fact, banks should make loans
that they are willing to carry for
several years"
With this he coupled a warning:
"A continuation of forced liquida-
ton will put the Government further
into the lending business
Would Change Examinations.
A single examination of banks, by
all agencies of Government, probably
once a year instead of several times
as at present, was recommended by
Jones. He pointed out that one cause
OF hesitancy to loan money was fear
of too much examiner criticism"
Careful study of the proposal for a
unified bank examination had been
made. he said after series of con-
ferences with several Government
agencies.
Bank examinations could very
properly be made on basis of sound
ness and solvency. rather than too
much liquidity," Jones said.
The association today also elected
officers for the next year, elevating
tb the presidency Rudolf S. Hecht,
! chairman of the board of the Hibernia
National Bank of New Orleans. who,
in conformity with custom. was ad-
vanced from the post of first vice
president
Robert v. Fleming, president of
Riggs Bank, who has served this year
as second vice president, succeeded
Hecht, thus moving forward to the
presidency next year.
Tom Smith Elected.
AS second vice president, the asso-
ciation chose Tom K. Smith of st.
Louis. president of the Boatmens
Bank, who until recent months was
an aide to Secretary of the Treasury
Morgenthau
The association, which winds up its
sessions tomorrow. met today with at
tentlon centered on the address which
President Roosevelt will make tonight
at Constitution Hall.
There has been no intimation of the
trend the President will take in this
speech. which is being anticipated as
one OF the most important he has
made but there is a well-deined hope
among the bankers that some word
Will be forthcoming that will serve as
q Stimulus to tagging industry.
j. F. T. O'Connor. controller of the
currency, in an impromptu speech be-
fore the convention. told the bankers
that of l,417 national banks and those
banks in the District which did not
open after the bank holiday only l8
we're closed today. and of these IA had
plans approved for reorganization.
s1,SOO, ,OOO, 900 Freed.
Those closed banks in March, 1888,
had s. 900 100000 tied up. OF this,
he added. sl,8ooooo,ooo has been
freed.
The convention also heard Roger
Stefan. director of modernization of
credits of the Federal Housing Admin
istraton.
stefan said there had been rapid
pickup" in modernization loans in
the last few days. The loans now re-
ported. he said. total 22569 approxi-
mating slO.00OO0O to property owners
w.,h average incomes Of S2,712. These
loans average s430 for a term of 27
months. he ampllfled.
In his speech Jones launched into
h.s argument for long-term credits
even up TO five years-right at the out
SCI
He told the bankers the feeling is
that you are willing to make loans, but
only on collateral that lew possess"
Banks must lend upon the security
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