Proposed Reduction Of Bank Capital

Tho United States tnvestor, a pa per devoted eccöusively t financia mattcrs, publtehed aome Lnteresting facts rc'.niive to a movemera of the Massachusetts savimg banks to reduce the bank capitaliza tton of Boston, either by Inducing some of them to wind ui and qui business or by cnnsoadalion. therebj reductiig the numbev of ba aks. 'i'Iio mnvoincni look th i'oi-in oí a meel na; of representaitlves of the savinga banks, hoM a slvort liiih' go, at whieta s-ome Eacta eami out. It appears that the savliags banks of JTassachuscl Is are ,:wxi o-wiici-s dl liosiini bank BtOCks. Tliis kn it.soif win surprise many ietons who have been led to believe by demagogueeiof thE T.ryan gchooC that all the haink stock in the country is owned by mlUiooaires and plutoerats. The Journal lias published irtatlstlCS ahowiag tiiat the average ixoddlngs a-re not large, but this Information In regard to Hip eavimgs banks is new. In Massachusettfi these institutions are very earefuüly and eonservatlvely managed. There are ne ir'.y two hurdred of tbem, wit 1,250,000 depositara and abom $4257000,000 o: depostts. They carry the savtngs of the worktag rop'e. I'nder The law of Massachusettfa savtags bank depositors are Jlmited to $1,000 ïor a single deposltor, so it is plain there are no rich men amon its 1 .üöO.OOO depositors. As the baaks pa y interest on deposits, it is important that tfreir iunds shou'.d be well and safely inveffted. The üivestments ave re those of the depositors. In the city of Boston there are sixty lational ►amks, wïtib 522,649 sli;i:vs oí stock, i whfch 194,649 shiares are heiltJ b.y he savhisïs banks. In ollior worde, he eavlngs banka of Massachusetta :!T per ctMii. o:' h natlonal iaiik stockoi Iïoston. In the ïase of iu-lit naiiuna; banks i h' savings bankg h-ol'.d a majorlty oí the stoi:k. This :.s equiva'fnt to Baylng tha-t a majority of the stock in these banks nd 37 per cent), of the stock ofa:i he national banks in P.oston is held by wage earnevs. TliLs is a new and uiteresting refuta-tion oí the oft-repeated charge ttiat the. national )anks of the country are owped by nillionaires. The movement by savSnga banks to bring about a reduction in the capialization o' ths natlonal banks g.ows out of a desire to put the öatter on a betterlimanclalfooting. The savngs banks dn nol Elke to hola- in fact an ni.t afford to I o fl aon-paying itocks, yet durimg the ".ast U-w years lutic a Qumber dí the ïmtiona: ba f Boston have paAd i divídenos, n December, 1895, out af sixty naai: lmnks bhere were iiineteen uiw)s( stock sm1 below par ; on Dec. ). 1896, th ttumber had Increased 1o ,wenty-two, fa othev words, the stock oí near.y 37 per cent. of the naiona;i banks of Boston is quoted below par. The savir. ■ iiiuibs are reluired to make regutor periodlcal i-eports of their eoadition to the state officials, and it is moi-tiiying to them 6o be oblóeed to report constantly dimi-nishing assets. Henee fcheir desire to do sometJiing to reduce the naJttonai bank capital oí Boston to a point where the proiits wJfll be such as to keep the stock at par. Thls can ouiy be done by reduclag the number of tihe banks orthcir aggregate eapitaiizatio-n. Of th elglit national banks of which the savlngs banks mviL a nia.im-üy o: the stock Ihat of four i-5 quoted ai par or over, w!ii:e tihe stook oí tour others ie quoted in . ie eighties. As the Bavirags banks ovrn a eontra'jliiig? interest in these banks, they can, it' they choose, wind bhem up. Tliis would reduee the ttiil ïmmlier of banks by (uur, and ülis (iu:d probaWy bo followed by an effort to eonso'.id'ate some of the emaininu- banks in BUCh a wa.v as o effect a ïm-ther reductiion. Tliis ihasc of the movement is interesting is BhOWing hOW ]Hrlc pro i' Mirre ÍS n the national bank busi íess. The report of the controller of tlie curency shows fchai for tome years past he averay;i nel earnings of all the laticnal banks in i lie country lias h'cii a Erad li in en e ' 5 per cent. riiir:. of course, inocuos tliat aiany öf hem must have earned eonsiderabiy ess than that, and some scarcely myfhlng. It is surprising to team hat out of sixty nationaü banks iu Ue city of Boston the stock o! tweny-two is now quoted at Iess than ►ar.