Show ECKELS PLEA fOR TH BANKS Says They Are Handicapped by Existing Laws UNCLE SAM SHOULD GO OUT OF BUSINESS The Banks Alone Have Maintained His Solvency Annual Report of the Comptroller of the Treasury Every Great Commercial Com-mercial Country Eccles Says But the United States Leaves to Its Banks the Sole Province to Issue Paper As Currency National Banks and Dividends Washington Dec 5The annual report I port of James H Eckels comptroller of the currency for the year ended Oct 31 1897 opens with a brief review of the history of the legislation which t I constitutes the present national act and invites the attention of congress to amendments to the law r commended com-mended in former reports without specifically repealing them On the subject of bank note circulation circula-tion the comptroller says It is noticeable that in all the j changes which have been wrought Lathe La-the national currency act from its inception in-ception to the present time the feature fea-ture subject to criticism but which was intended should constitute the principal princi-pal benefit to be conferred has remained re-mained comparatively unchanged numely the note issuing function Whatever justification there was in the first instance for restricting the issuing of notes against the bonds of the government deposited with the treasurer of the United States to 90 per cent of the par value thereof long since ceased The report of every comptroller of the currency during the past 20 years the wisdom of changing the existing law so that the banks and through them the communities in which they are located might have the additicnal benefit of an added loanable I capital has been urged Despite all this the law still remainr without amendment THE BANKS HAMPERED Not onlY should the bank act be amended in this particular but congress con-gress should seriously consider such a change in the method of bank notes issues is-sues as will enable the banks of the country to more adequately meet the I demands of trade and commerce in all I i sections of the country The business of banking like every other form of investment must be made attractive to capital If it is placed upon a footing foot-ing different from other undertakings embarrassed through unnecessary restrictions and deprived of proper sources of profit the result cannot be otherwise than that investible capital I will seek other means of employment and to this extent deprive the people of a currency most requisite to commercial com-mercial activity It is considered by every great commercial com-mercial government except the United States to be the sole province of the banks to issue paper which circulates as currency The belief in a bank note currency as being better and safer than a government gov-ernment paper currency proved unquestioned un-questioned in this country until after the apparent exigencies of the war tte government undertook to issue paper currency Even under such circumstances circum-stances the promise was always given however that it should be retired at I the earliest practicable moment and the admission made that it was neither a wise measure nor a safe form of I currenc RESTRICTIONS OF LAW Between competition of the government I gov-ernment issuss on the one hand and the unnecessary restrictions imposed by law on the other together with the increasing prices of bonds required to be deposited as security the note issuing is-suing function of the banks had been permitted to become merely an incident to the conduct of the national banking associations of the country It has been seriously suggested more than once that the bank note issues be done away with and all paper be issued by the government instead The danger of such a course is not to be over estimated esti-mated The experience of every governmental gov-ernmental currency paper is a source of weakness and danger In the United States where there has been the nearest near-est approach to success with the volume vol-ume of federal paper comparatively limited in amount the credit of the government has been more than once put in Jeopardy through it and the business interests of the country subjected sub-jected to unnecessary loss and confusion con-fusion The argument that the government govern-ment better than the banks can provide pro-vide for the redemption of paper note issues will stand the test of a careful analysis The government has no means for caring for its demand liens except through borrowing and through the levying of taxes Upon the other hand the banks have assets which can be promptly converted into cash to meet the standing notes when presented pre-sented GOVERNMENT The ability to command gold has always al-ways been beyond that of the government govern-ment the banks have furnished to it the amounts necessary to maintain its solvency It is important to believe that with a system of bank note issues based in part upon securities and in part upon bank assets the country can be provided with the sound safe and elastic bank note issue always commensurate com-mensurate with and responsive to the demands of trade The Bank of England Eng-land the Bank of Scotland and the Bank of Ireland have been found to be ample in their resources to provide the note issues for use in the trade of the United Kingdom The same ft true of the Bank of France The Deutsche Reichs bank or German Imperial bank has for more than 20 years issued is-sued bank note paper against assets which has maintained its value and been so controlled as to successfully meet the commercial needs The comptroller calls attention to the method of organization of this bank and publishes some interesting statistics statis-tics in connection therewith NATIONAL BANKS The total number of national banks organized since the system was put into operation in 1863 is shown to have I been 5095 On Oct 31 last there were in active operation 3617 having an authorized au-thorized capital of 630230295 The total outstanding circulation of the banks then in operation was 229 199880 of which 5202991555 was se il CUlcl hy bones of the United States L and th balance by lawful money de j PSlted with the treasurer The cir latlon outstanding on oet 1 < < I J O131005 of Which amount 538800 was secured by bonds held for < lttmt II I or r Insolvent and luxating banks and k 2205325 J Oao2o y lawful money deposited for their amount of circulation The It net decrease in the amount of circula tion secured by bonds during the year L was 12584334 and the gross decrease I in the total circulation was 4851292 p The 3617 banks in operation are di clued geographically as follows There I o are 588 with an authorized capital stock of 5159291620 in the New Eng land states 956 with a capital of 195 124275 in the eastern states 546 with a capital of 66761900 in the southern states 1046 with a capital of 160369 961 in the middle states 357 with s cap ital of 32654160 in the western states and 124 with a capital of 17465000 in the Pacific states During the year 44 banks were organized or-ganized with an aggregate capital stock of 6420000 During the year 71 banks went into voluntary liquidation There was paid to creditors of insolvent insol-vent banks during the year 13161781 in dividends DIVIDENDS PAID CREDITORS The magnitude of this unequalled record the report says will be more forcibly illustrated if considered in the light of what has been accomplished heretofore in the way of dividend payments pay-ments to the Creditors of insolvent institutions in-stitutions In 1893 there was paid in dividends 34S3646 in 1894 5124577 in 1895 3380552 in 1S96 2451959 and in 1897 131697S1 making a total of dividends paid within the five years from 1893 to 1S97 of 27560515 or 3614 per cent of all dividends that have ever been paid to creditors of insolvent national banks From 1863 to 1S97 there has been paid in dividends 75 935825 and in the year embraced in this report 13169781 or 17 13 per cent j of all the dividends that have been paid during the period of 34 years of I the existence of the system Since Oct 31 the end of the yearly report 17 additional dividends have been or d red amounting in the aggregate to about 625000 FEATTRES OF REPORT The report contains the latest compiled com-piled statistics relative to the worlds monetary systems and the stock of gold silver and paper currency Avery A-very interesting feature of this statement state-ment is the per capita amount of each kind of money in the countries named The per capita averages in the principal princi-pal countries of the world are as fol lows United States 2370 United Kingdom 2055 France 3468 Germany Ger-many 1895 AustriaHungary 933 and Russia fS95 The comptroller renews his recommendation recom-mendation of last year urging that national bank examiners be paid an annual salary instead of fees as now |