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The Question Of Branch Banks

The Question Of Branch Banks image
Parent Issue
Day
31
Month
March
Year
1897
Copyright
Public Domain
OCR Text

If small national bauks are to te encouraged in the more sparsely settled portions of the country, the question arises whether they should te purely local organizations or branches of the great metropolitan banks. The old United States bank had branehes whicb, by virtue of their connection with a large central institution, had some advantages over the local banks with which they competed, but were in more than one instance the objects of adverse state legislation. This spirit of local hostility to a bank iocated in another citj-, and perhaps another state, left memories which still survive and which account in part for the opposition to brancfa banks. But the cxperience of England and Scotland, Canada and Australia, is strongly and uniformly in favor of large central banks with many branches. The banks of Canada are able to maintain a singular unifornrity in the rates of interest in the great commercial centers and in the remote agricultural regions because the banks of Montreal and Toronto have their branches in Manitoba and the Pacific región and can transfer the surplus capital of one locality to meet the deficiency in another as it j not be done by wholly independent banks. The conditions in Canada are very nmch like those of the United States, and the success of the Canadian banks in doing what we recognize the importance of having done is entitled to great weight in our considerations. In Scotland it is well known that the branch system has greatly favored those agricultural interests which in our own j country are so much in need of financial accoruinodation. The preponderance of financial testimony is decidedly in favor of the branch system, most of the opposition to which comes, or would come, from local financial interests, jealous of strong outside j competition. There is a feeling of distrust of all banks which is born of ignorance. It increases rapidly with the increase of a bank's capital and the extensión of its operations. which are supposed to prove the bank to be a

Article

Subjects
Old News
Ann Arbor Courier