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Show FOR FAILURE PROCFBANKING PROOF PROOFBANKING PROOFRANKING BANKING RANKING STRUCTURESneaker STRUCTURE STRUCTURESpeaker . Speaker Sneaker Outlines Threefold Co- Co Cooperation Co Cooperation - , operation Between Bankers BankersGovernment , : Government Officials and andthe andthe I Ithe the Public to Maintain MaintainBank MaintainBank MaintainBank Bank Standards Standards _ _ 1 TWO TpWO ' elements beside the bankerst bankersthemselr bankersthemqeh bankers ! t * themqeh themselr them < < ehes es are required In order to togl toghe togl gl\ gl gle ghe \ e tho natIOnmlversall nation \mlversall mlversall \ universally ) the t tipe tlpe ) pe of ofbanking ofbanking ofbanking banking it 'houl houl ! ' should h'n hn hiie he ' e Francis rrancl6 rrancie H II Sis Sls Slsson Sisson Sisson son , president of the American Amerlcau Bank BankelS Bankers Bankeis elS ers Association , . declared in ii . iirecent a recent recentarIdl recentarldiess recentarldiess arIdl arldiess ess He said that the efficlenc efficiency ) of ofgO ofgovernment otgo\ernment otgo ernment gO\ gO gOern government \ ern ment officials omcials upon ' \ whom horn the thepeople thepeople thepeople people rely rcly to supen super supenlse Ise lse the banks banksPl banksproperly bankspiopcrl Pl properly opcr ! } ) , , and the patronage of the theI I cople caple themselves are fictors hclors flctors in the thehind thekind thekind hind kind of banle bani banl e s a conmunity cOlmumty corimumty " } shall havcThere haveThere have havc haveThere There can he be no question that the thep.ople thepeople thepeople p.ople pople people ( . of the United States Statce should have havebanlts havebanks havehanks banlts banks immune tiom flam fiom failure and wholly whollyfree \ \ \ holly hollyfrpe hollyfree frpe free from bad or questionible questlon'tble questlontble questionable ' banking banllf'g banllfg bankirg ( ' 'Mr Mr ' , illr Mr : Sisson said 5111(1 51111 ( 'It It ' It is not enough as asPres.dent asPresident asPresident Pres.dent Presdent President . Roose\ Roose Roosevelt Rooseelt \ elt has said s.id sid : . that that"hlle thatw that\\hlle that hlle "hlle hlle w " \ \ idle some hankers bankcrs bankers hid h'td htd lrid ' been incompe incompetent incompetent incompetent tent oc or or . . . dlshone dlshone&t dlshonet dishonest & t , this was not true In Intbe inthe Inthe tbe the inst v \ 'tst tst ' st majority of our binks b'1nks b1nks banks ' A SIt SItuatlOn situation sitnation uatlOn uation should e exist , < lst In which whlcb there Is IsDot isnot isnot Dot not even a small mll10llt minotit minonti ) of ban"ers baners bankers ban"ersop bankersopen ban-eraopen ban eraopen - " op open n to question There . ; should hould be no noroom noroom noroom room tor for dlshonebt dishonest dishonesty ) or incompetency Incompetencyto to exercise any influence in banking bankinganywhere bankingan an anywhere } ) \ here hereVhlle ' \ While \Vhlle Vhlle bad fnitb fmth faith and bad manage manage- management management management - - ment enter the human factor in all allt allty allt t ty ) pes of or business their effects in bank bankIng banklag bankIng Ing lag should be surrounded by such spe spe- specIal special - cial safeguaI safeguaids safeguards ds as to render them no nolonger nolonger nolonger longer a factor f'1ctor f1ctor ' in bank failures failuree The TheresponSlbllity Theresponsibility Theresponsibility responSlbllity responsibility tor for bringing bnnglng this about abouthowever , however , cannot rest upon the bankersalone bankersalone bankers bankersalone \alone alone \ alone , for the means to accomplish itare itare it | are not wholly in their hands Thereare Thereare There { are other essential essentlal elementsQne elementsOne elements elementsOne One Qne Is ig the efficiency of government government8upen governmentauper governmenteupenislon 8upen auper islon is Ion Since we rely 60 so greatly greatlyupon greatlyupon greatlyupon upon supervision . , It may , unless It Is at of atthe ofthe ofthe the h highest ] [ hest order In safeguarding the thepublic thepublic thepublic public interest . , , , create a sense of ot false falsesecurity falsesecurity falsesecurity security Supervision should render renderbad renderbad renderbad bad banking impossible , but It has hastailed hasfailed hastailed tailed failed to do so There was super supervision supervision supervision vision by presumably the highest type typeof typeof typeof of bank banh supervisors supervieors in everyone every one of ot the theinstances theInstances theSnstanccsj instances ot of ) quegtionable questlOnable questionable banking thathas thathas that thathas has sho-eked sho eked shocked - fh the attention ft tio IThe of the c coup couptrs countn n ntn tn trs during durmg the past three years There- There TherefOI There-foie There foie - . - fOI Iota e a thorough strengthening of super supervIsion supervision supervision vIsion is clearly called for It if the people peopleal peopleate peopleaie ate al e to rely on It to the fullest extent extentfor extentfor extentfor for the protection of ot their interestsThe Interests InterestsThe - = > ! The Public Public't Publict Public'o Publico ' ' , Part"Another Part > "Another Another " essential factor In maIn maInblnlng maintaming maintalning blnlng taming good banks im involves olves the part partplayed partplayed partplayed played by the public In banking There Thereis IS certainly a responsibility responsibll1ty on the peo peopIe peopie peopie pIe themselves to support that type of ofbanl.er ofbanker ofbanker banl.er banler banker . \ whose \ hose rigid adherence to soundpunclples sound soundPllllciples soundpiinclples Pllllciples punclples makes a sound bank , rather ratherthan ratherthan ratherthan than to give glve their patronage to the easy easygoing easygoing easygoing going banker who may be easier to do dobusiness dobusiness dobusiness business with , but whose methods cre create create ereate ate a "eak eak weak " eak bankBank bankBank bank bankBank Bank customers are charged \ viith with lth a agreat agreat agreat great responsibility responsiblllty In protecting the thesafety thesafety thesafety safety of their banks m in reepcct respect to their theirutlllzation theirutilization theirutilization utlllzation utilization of the assets of the banks as asbOrJowers asborrowers asbonowcrs bOrJowers borrowers Banks have tailed failed because becausemany becausemany becausemany many of their loans and securities , cre cre- created created - ated in ill good faith faithi b > ) bankers in coop cooperatmg coopcrating coopcrating eratmg crating w \ with lth Nth the business bU6lness interests of ofthe ofthe ofthe the country countr ) , , proved unsound under sub subsequent subsequent subsequent sequent conditions condlhons An unsound loan lS is iscicated iscicated .1 1 < . cicated ealed by the borrower as a6 well as the thebanler thebanker thebanker banler banker { A bank is only as sound as its itscommunity Itscommunity itscommunity community , and this applies apphes also to the thebanking thebanking thebanking banking structure as a whole in 111 rela relalion relation relalion lion tion to the economic condition conditfon of the thenation thenation thenation nation as a whole'A whole'A whole whole'A 'A A ' bink b'1nk b1nk bank ' Is fs truly a semi public insH insti insHtutlOl1 institution Inslitution tutlOl1 tution , but In a reciprocal reclprocal sense-it sense it sense - it has hasits hasits hasits its obligations to the public , but so has hasthe hasthe hasthe the public equal obligations to the thebank thebank thebank bank No one who has not sound bank bankIng banklag bankIng Ing lag principles at heart has any business businessin in a bank whether as a banker or as asa asa asa a customer , ' The banker Is a semi public servant servantHe servantHe servantHe He is charged with the heaviest of re responsiblUttes responsibilitles responsibilitles sponsiblUttes sponsibilitles and obligations that occur occurIn occurin occurIn In our economic life But be he can meet meetthese meetthese meetthese these fully only through the coopera coopera- cooperatIon cooperation - tion of good laws , good public pubUc officials officialsv officialsw officialswho v w . ho do are empowered to exercise auk aukthority au authority . thority over his bank , and good busi busi- business business - ness methods on the part of business businessmen businessmen businessmen men generally who utilize ut11ize hia hiC5 hla bank bankOnly bankOnly bankOnly Only through such 8uch cooperation by all allelements allelements allelements elements In our nation's nations ' community life lifecan lifecan lifecan can we be assured of at a It failure proof proofbankmg proofbanking proofbanking bankmg banking structure ' , The Administration at WashIngton WashIngtonhas Washingtonhas has taken bold hold ot of this problem with a afirm afirm afirm firm grasp of essentials essenhals and is exereIa exerels exereIaing exerelsing exerciaIng ing splendid leadership toward the de desired desired desired sired end The strongest feature ot of the thegovernment thegovernment thegovernment government program will w1Il be found in inrecognizing inrecognizing inrecognizing recognizing the joint responsibility responsibil1ty of ofthe ofthe otthe the public pubUc , of ot business and of govern government government government ment officials together with the bankers bankersthemselves bankersthemselves bankersthemselves themselves in creating the kine kind } ot of otbanking ofbanking otbanking banking the nation should have ' |