Show ON I Savings Banks Burdened With Too Much Cash 4 PAY INTEREST DISCUSSING DISCUS TO iHK RE REThe REI I The question q of f g the U inter interest est eat e rate rte f to one eise that dIet tt the lOcal focal t bankers haye baye bee b al fw fur t months tb peat past p The TM savings feure for f some ame years ye been allowing 4 pet per east cent Interest on de deposits d deposits posits p The Te e banks k allow alow no interest Inter to tle u av avest depositor detor but bt some sm of o them te eoe Interest bear bearing br brIng bearing ing certificates cert t The T general el feeling among the t banker of o t the city ct especially e ally aUy those tho conducting banks bk is that the rate r of interest on deposits dept should sOld b rawer lower but bt as ag y deposits of ot this ti kind upon which internet is paid pi con constitute cn constitute so s small mt a 8 pert part pt of o the business bune of the commercial banks bk that tt they are not worrying wo over the t matter and whatever te is i done de in la this tl direction must be done by Iy the tl savings banks The situation is J this thin The Zions Zis Savings Parings bank hk now has h deposits t to the amount of or 70 the Deseret Deret Say Sav Savings S lags ings in bank bank and ad the other three banks blU that have hv savings n depart departments ments the Utah Commercial Say Sav Savings Sv Sayings ings the Uth Utah Loan Least L Trust company complY and the Dank Bank of Commerce have al almost 1 most mt enough gh to raise rb t the total a to Much of o this vast vat sum sm is isnow I isnow now B lying idle Ile in the t banks bk because bu it i cannot be loaned leaned Jone out at 7 per pr cent or more Jre a the banks hold that tt they the cannot p IY pay y 4 per cent on o the deposits and ad then loan the money mon out at a less le rate rte that thai 7 1 pet per p cent ct and ad d make mke it i pay py The reason they cannot do this is be because b because cause cuse they th are ar compelled by by law la to t keep a good g portion port of deir ter Ir deposits as a a reserve re and a this brings bring no in income come coins cm th they have the t expense of run running rn running ning their ther banks and even with the very best of management they lose J an occasional loan Jon Pay yearly ely The Te interest int est paid p to t the U depositor is iB isa iBa Isa a standing expense ex to thOse these t savings sving banks and an cuts cut very ver deeply Into their profits On the dep th now on deposit in the banks of this Oak class clas Jn In n the t city the tb Interest paid to t the te depositors is D and Id if even een half hl of the de deposits deposits posits pit are lying idle in the banks it i represents repent a dead de loss J to the banks of a year ye The main idea underlying this move movement movement ment for a lower interest rate rte on bank bk deposits is 18 to force for some ae of this money now idle idl into tnt the th channels of trade tre It is held that th the business of the community would woul thus be b stimulated stimulated which would be b a benefit and at atthe atthe atthe the same time tm the banks bk would be re relieved of this thi heavy surplus upon which they are ar now RW paying interest while it I te Is I idle ile in their vaults vault None of the savings banks has ha yet taken any ay action aton as a they are waiting for some sm one to make mke the tb move It is held he that tt if I one makes make the te cut at this time tm the th other beaks banks will wl be forced forc to follow suit sui because beus if IC i they t I refus refused they would woul be b swamped corn com completely cm with deposits as swap people would naturally take their money where they could get the th most niost mt for it Good Investments lacking Old Od bankers banker of long Jong experience pIece say sy sytha that tha the trouble tuble is not no so s much in the heavy heV deposits as a it I is J in the lack Jk of good go opportunities for investment The eastern eten loan Jon companies are arE now W putting PU money oy into Utah Uth and the the sur surrounding surrOunding rounding runding states stes at 6 8 per pr cent cn many nany good loans have been made as low as asper 5 per ner cent and in one case a big loan was made for 4 per cent ceRt This was of course a long rong time loan on gilt edged city eft property But this is 18 the condi condition condition condition tion that the local banks have to face If they expect to get big interest they must take risky security if they look for good security they t ey And find many com corn competitors competitors in the field debt and have very great difficulty in placing good loans at 7 1 per cent One banker thought tho the organization of a local loan Joan company to compete with the eastern companies and to utilize the home capital that is isnow isDO now flow DO idle would be one good solution of the problem There was a meeting of the board of directors of the Zions Saving bank yesterday to consider the matter of re is reducing reducing the rate of Interest on deposits to S 2 per cent but no DO definite action was taken although the proposition seemed to meet with Ith favor It Is thought that at the next meeting of its board of directors it will wm decided te I make snake the reduction |