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Show i HONESTY AN ASSET. I . Instances Where Character Alone Stood for the Bank's Risk. ' In Scotland, when a man has arrived at years of discretion and won a reputation repu-tation for capability, a bank will, simply sim-ply on his note, backed only by his character, advance him sufficient mon-,ey mon-,ey (usually a moderate sum) to start in business. This is considered and the conclusion !s based on results to ! be a good risk. In our large cities, New York and Chicago, for example, ; business is not so frequently conducted .! in that way, but there is no doubt that 5 our great western countiy owes? much j of its wonderful growth to those far-' far-' sighted country bankers who realized that the borrower's character was the chief asset to be considered. Naturally, Natural-ly, character plays a relatively larger part in the loaning operations of a small bank than a Wall street bank, and in the beginning of a business man's career. Its relative importance is a matter of environment. In 1S!)3 a New York firm of :-.nr-chants became heavily involved in enterprises en-terprises that were sound but in whiciv the realization of. cash was slow. The head of the house informed the representatives repre-sentatives of the banks that they would be obliged to "carry the firm" through its difficulties or there would ce a heavy failure, when the banks, would be heavy losers. The banks agreed that this was so, and assumed the burden. bur-den. In the ensuing investigation it appeared that the head of the house, in securing loans, had omitted certain facts that indicated a lack of frankness, frank-ness, we will say. Six years iater that same man was elected president of a newly formed industrial corporation or trust. .. It appeared in the mo.iey market mar-ket as a' large borrower. There was no reason why the accommodation should tfot.be granted, until a particular particu-lar banker was attracted by the siina ture of the president, when he recalled the episode of 1895. The final result v; as that the bankers informed the directors di-rectors of the corporation- that th.v could only have the credit desired when another president was elected. A rtaw in that man's character cost; him the pteHOenej of this particular corporation. corpora-tion. A mining promoter, .a man with a charming personality, endeavored to float ?. valuable mine several vears ago in Wall street. He failed to do so. . Another man took up the worS where he left off and succeeded. AsKed-why AsKed-why he -failed, he said bitterly: "Personally I am honest. Some vears ago I had the misfortune to be. 'associated 'asso-ciated with a man who accumulated his money out of a questionable trade. I was said to be his adviser and confidential con-fidential man. ' No one would trust hiv., and now I find that every one is. reluctant reluc-tant to trust me. I am a "nice fellow, but "and then I fall down. A good reputation would have been wortii a fortune, to me in the last few years." One of the most successful Wali street bank presidents was invited on one occasion oc-casion to become a partner in a private pri-vate banking firm. The opportunities for making money .were very' gi eat. He thought it over and was favorably disposed toward the. proposition. He consultd a friend. "But," raid the friend, "a man of jcur character, could not ge alrj with (mentioning a member of th h-ir-i Why? He's -tricky." - - "Two 'years- later the firm in ques-tion ques-tion Dissolved, and the tricky partner reured, but he had impaired the standing stand-ing of the house. . The same- banker was offered $25,000 to become a Erector Erec-tor of an industrial -companv that appeared ap-peared tp; ..be, and. was, financially sound. . v ...... -. "'Your duties, said the lawvrr mak-mg mak-mg the offer, 'will be only nominal. We simply want your name.' - "The banker concluded that he could not afford to be. associated with the other men of the board. Sufelv tlie character of this man is a very tangible credit asset; - "A Swede walked up to the president of a western -taiik and said: ."'Ay. tank Ay, want to', borrow. $5,000. j and Ay tank I get him here.' '" ' "Cross-examined, it was ascertained that he .had no money except a few hundred dollars, but he wanted to buy ' a;mill. Ho was honest, a hard worker ' and a good trader. The banker liked ' him io'well that he Was billing t? back his own judgment and so he loaned the Swede the money he needed. The borrower bor-rower made good and became one of the most useful citizens of that community, com-munity, j "In a little southern health resort town last winter I met a young merchant mer-chant who did a business of $35 nnO a year on a borrowed capital of .$3,000. " 'How did you do it, and how do you get the credit?' he was asked. " 'I turn over iny stock ten times a year,' he replied. 'But the banks here' know me, and they know that I am a man of my worJ, and they knew my fattier before me. When I say that I will be at the bank tomorrow at 11 o'clock with $1,000. they know that I will be there at 10:55. I am part of this town. I was born here; my wife and children are here and I expect' to die here. The man I bought this business busi-ness from was not as honest as he might be. I worked for him, and at the samo time I protected the two banks with which he did business.' "I made . a few inquiries and the country banker made this explanation: explana-tion: ;" 'The man who owns the business now worked for another man who owed, us $2,500. The present owner knew that the moiie;c was in another bank,' and promised us that it would be. delivered ltcre at a-certain -time.. The old owner drew out the. money "and went. off on a spree. The present owner; rather than not make good hitf wrd, borroved the money on his own note and paid .lis off. When the business came'bn the market we helped' :hlm" get 'it. and'we-are glad to do business with him. We only wish that we could get more like him.' '"There are ten thousand business men in-New York who tomorrow might lose every penny they possessed and yet on the day following they would start new careers, full of courage and confidence, backed by the seemingly' intangible in-tangible but very definite assets-brains, assets-brains, health and, most important, good character." World's Work. |
