Evening star., 1936-03-23
CONTROLLER ASKS
BU|LD|NGANDLOAN
CODE CHANGE HERE
O'Connor Also Would Revise
Laws on Credit Unions
and Trusts.
HOSTILE LEGISLATION
HELD NOT INTENDED
Material Improvement in Bank.
ing Situation Throughout U. S.
Noted in Report.

Noted IN Report.
Noting a material improvement in
the banking situation throughout the
country" including gains in all lines
here, Controller of the Currency j. F.
T. O'Connor in his annual report to
Congress today recommended amend
ments to the District Of Columbia
Code relating to certain trust COM
panies, credit unions and building and
loan associations.
There should be a general re-
vision Of the District of Columbia
code in so far as it relates to building
and loan associations" said the con-
;,oller.
c. C. James, chairman OF the Federal
Legislative Committee OF the District
Building and Loan Lesgue, said he
understood proposed amendments for
building associations would in no way
be hostile" legislation, but would
be designed to bring the local law
OF 1909 up to date with the rest
of the country. A number Of changes
have taken place in building and
loan laws, both Federal and State, in
recent years.
Urges Extension of Trusts Life.
Tentative proposals for the amend
ments are understood to be under
consideration at the Treasury, but
James said he had assurances that
the suggested changes would be sub
mitted for consideration of the
Building and Loan League before
being passed on to Congress.
Regarding trust companies, the con-
troller said that there are number
here whose corporate existence ap-
pears to have been limited to so years.
This period in some cases will ex-
pire as early as 1910. Pointing out
that the original act limiting the
corporate existence of national banks
to 20 years was modified to make
them indefinite, except when closed
for cause. the controller recommended
life of trust companies here should
be extended likewise.
He recommended that District credit
'lnions Ce assessed for the actual
cost of examinations mace by the
controllers oddce.
Banking Gains Reported.
'Connor's report showed that during
the last fiscal year there had been no
bank failures in the District, and
gains in the field of general banking.
building and loan associations, credit
unions and postal savings.
The % building and loan associa.
tions here, O'Connor reported. showed
a gain of more than $8,000,000 in
assets over year ago.
Total assets of the % banks
showed a gain of more than $l7.000.- =
900. against the assets of 81 banks
here a year ago.
Many new credit unions were
licensed under law.
Postal savings were up $358,780.
Showing the gains made by the
% building and loan associations.
the controller said their assets totaled
$10l .477.000 on June 80. 1885. and
exceeded by se,118.000 the assets Of
these associations on June 80 year
ago.
Increase i'm Loans.
Their loans, which aggregated $92,-
SOC, 900, showed an increase Of ST.
100000. Installment payments on
shares increased from $83,S71 900 to
$50. 100000.
Twenty-three of the associations
operated on the permanent plan, four
on the serial plan and one on both
permanent and serial plans. The total
membership was 118,117, as COM
pared to 1o3,550 members a year ago
and of the total in the current year
the numbers borrowing and non
borrowing were 27,639 and 90,478
respectively.
In his recommendations for new
legislation for the country as a whole,
O'Connor asked Congress to clarity
an existing law whereby national
banks may declare dividends only
semi-annually. He did not elaborate
on the request but observers believed
1t meant the repeal Of the 70-year-old
provision that the controller himself
declares Is being constantly violated.
O'Connor also renewed his sugges-
tions for a retirement plan or pen
sion fund for national bank examiners.
The plan he proposed would require
no appropriations from Congress but
would be financed through monthly
salary deductions from the employees,
plus the application of portion of
the assessments against banks and
their affiliates.
Only five national banks were re-
ported by O'Connor throughout the
country to have failed since inaugura-
ton OF Federal deposit insurance jan
uary l, 1884.
OF special interest to depoSitors in
the several insolvent banks here was
the controllers estimate that through
out the country total costs incurred in
liquidation of insolvent national banks
as reported by receivers were equiva-
lent to 7.67 per cent Of total collec-
tions from all sources, including Of
sets allowed. The increase In per-
centage of expenses for the current
year Is for the most part the result Of
interest payments to the Reconstruc-
ton Finance Corp. upon loans to re-
ceivers for dividend purposes.
OF the 10 closed banks in the Dis
trict, the controller singled out as one
group for his report the "state bank
failures"-14 state banks. including
two banks incorporated under the
laws Of the District of Columbia. The
other five closed banks were under
the classification of national banks
and other classifications.
These IA banks, whose names he did
not list, O'Connor said. had assets, in
cbyIng assets acquired subsequent to