_ ’4. ‘
TIN-Airman. { msrirofrrons. _
SAFE AND SUCCESSFUL BANKING rm:-
ons HAvE- mnnl NEW—roar; run
' ~ MONEY ; CENTRE. ' '
‘ —-—-—-—‘-‘——— . .
tun minus on STATE ANDJNATIONAL BANKS
also mm .counmnp' nusonncnsewormnn—
FUL 'REUORDS SHOWN IN THE CLEAR-
ING' nonsn s'rxrmmu'rsernn mon-
TATION or GOLD AND run
I NEW WAR LOAN.
The statement that New—York exchange is as
‘good as gold anywhere leaves nothing to be.
bdded in describing the Importance of the
llt'netropclls as the financial centre of the West-
‘ern Continent The banking system of New-
iYork is not only the chief support and prop of
the enormous and unlimited trade of the city
proper, but in times of National financial perils
the bankers of this town have rendered in-
estimable services in assisting in bridging over
Laiiiiculties and steadying conditions so that in
_ e end the stability of American finances and
gstitutions has been forcibly demonstrated to
\‘he other nations of the world.
The financial supremacy of New-York has
ibeen justly ascribed - to safe and successful
‘banking methods. From the time when this
port began its wonderful career as the leading
city of the New World there has been thrown
around its financial institutions every safe—
guard that conservatism, wise judgment and
unexcelled executive ability could plan and de-
vise. Alexander Hamilton, America’s first great
financier, placed his stamp of approval upon the
growing and developing system, and from that
day tothis New-York banks and bankers have
stood prominent, respected and esteemed in the
councils of the city and Nation,
Under existing laws and treasury, currency
and banking systems the local institutions have
steadily grown in strength as regards their re—
lations with the banks of the interior towns
and cities. Around the New-York Clearing
House and its membership of sixty-five of the
foremost banks of the city, not to mention the
Sub-Treasury, with its annual transactions of-
enormous proportions and its widespread in—
fluence, ‘ revolves the business of the United
States. Imports and expOrts, the commerce on
the seas, manufacturing industries in all States
of the -Union, wholesale and retail housestof
, every description and all the professions are
made to feel the financialpower and might of.
New—YOr-k. There are circles-within circles-and
systems within systems, but in the end New—
. :TYork is’the pivot around which theyall move,
the centre from which radiates the money sup—
ply for the entire country.
STUPENDOUS TOTALS.
Accustomed as they are to big figures and
big affairs, the metropolitan readers themselves
are forced to stand aghast at the colossal fig-
ures shown in the Clearing House. statements.
Some persons are brought daily in contact ‘with
the actual business and its magnituderothers
have a general notion of the fact that the daily
commercial transactions of the Greater New-
York require enormous sums of money, while
the great bulk of the population give it little if
any attention. The total capital of the asso-
ciated banks which compose the Clearing House
is $58,272,700. An examination of the financial
exhibit of various banks lrings to light many
interesting points. The capital of the different
institution runs from $100,000 to $5,000,000. The
total net profits which have been made and re.
served are shown to be $75,911,300. But as re—
lated in the individual cases to the capital this
item of net profits tells its own story. For in-
stance. there is one well-known institutionwith
_ a capital of $300,000. and net profits of $6,996.-
400, while on the other hand a bank is found
with a capital of $1,000,000, and a. net profit of
only about $250,000. But these figures are the
result [of a varying length of business life
and other conditions which have to do with
the management of the business. In one case
the earnings of the bank may havevbeen paid
” ‘out in dividends to stockholders, while on the
other hand the profits have been placedhin re-
serve.
The statement of the banks becomes espe-
cially significant when the column of deposit is.
reached. In one of the weekly statements of
last month. which was a. record, by the way. it
appeared that the banks‘in the Clearing House
Association alone had on deposit $786,43a,000,
as against loans of $093,705,200. A mere glance
at these stupendous sums will satisfy the aver-
age man that no small trade is going on within
the limits of the town. , .
Out of the total number of banks in the Bor-
ough of Manhattan, forty are State institutions,
having a total capital of $14,016,200, and a.
surplus fund of $11,796,000 and undivided
profits of $4,164,015. According to the state-
ment of the Banking Superintendent of the
State of New-York for the nine months. ending
‘September 129' of, the present year there-Was
:‘z’due '_ depositors on demand 'from these forty
,ban_ks:$140,818,021. ' The total resources" of these-
Institutions were $200,193,432. .In' the Borough
of Brooklyn there. are seventeen. State banks.
out of a total of about ‘forty of all classes. The.
_' combined State. and National banks dt‘the Bor—.
ongh of Brooklyn have a. capital. of about
'85,000,000 and .3- surplus of about $4,000,000.
".-_Besides all these, National and State ' institu-
tions there are about seven foreign banking
houses in Gre’uterNcw-York, with a'total capi-
& .
- ’METR’ ‘ ammo: HOLI D" n71 SUPPLEMENT * ' .
m of $40,000,000 and a combined'surpius of
about $20,000,000. The capital of fifty—seven
‘Sta't’e banksln the boroughs of’ Manhattan: and
Brooklynexceeds the combined capitalof all the
State banks throughout the entire State.
sr’nany IMPROVEMENTS.
Although the official report of the Superin-
tendent of Banking for the present'year will not
period covering the first nine months show that
DrOSDerlty and. successful business operations
have attended their enterprises. In his last re-
port Mr. Kilburn hound that during 1897 .“the
condition of the banks'as a whole throughout
the State has improved markedly, their aggre—
gate resources having'lncreased $55,500,000, or
more than 20 per cent. Their-discounts have in-
creased nearly.$7,250,000, and the amount due
from banks and trust companies more than
$14,000,000. The gain in general deposits, the
item chiefly affecting earning power, has been
nearly $43,000,000, two—thirds of it having been
realized during the period from June 9 to Sep«
temberld, 1897." Inasmuch as the number of
State banks in New-York City is more than
one-quarter of the whole number in the State,
and also for the reason that all the country
ated with them in every way, these statements
by Mr. Kilburn have almost a. local significance.
Continuing, he says: "The business embarrass-
ments 'and wrecks which mark the period from
1893 to 1897 as'the most disastrous the country
ever experienced threw upon the banks a vast
amount of property held by them as collateral
security, which was not only not available for
banking purposes, but which required time and
judicious management in order to enable even a
decent realization to be made from it.
"Often such property was the sole salvage
from unfortunate loans, and with its value con-
tingent upon many» elements, usually conject-
ural, I could not with propriety arbitrarily
direct that it be charged off until a reasonable
opportunity had been given‘ for its conversion.
In many instances any other course might have
excited popular apprehension and distrust, even
to the point of endangering the ability ‘of the
banks to .meet the demands which in conse-
quence might have crowded upon it. Still, it has
been my policy to apply steady, though reason-
able, pressure upon‘the banks to eliminate from
their reports all worthless items as fast as their
worthlessness had been demonstrated. and to
require that the fictitious valuation of paper,
stock or real estate» be reduced. By this pol-
icy'ov’er $1,500,000'of apparent. surplus. or un—
divided proflts has been made to disappear from
the better understands the strength “of these in-
'stitutions. This policy will be continued, and,
. from the improvement in values which must at-
tend the advance ‘in' the prosperity that the
-country seems to be making, progress hence-
forth ought to be at an accelerated rate."
Mr. Kilburn sets up the banks of New-York
City as an example to follow in his reference to
,profits. He says: "I must not be understood to
approve of the practice, too prevalent in many
banks, of distributing earnings in dividends as
fast as made. It is difficult at best for an in-
stitution with a small capital to meet its ex—
penses of management, make itself remunera—
tive to stockholders and preserve a condition
which compels the confidence of the com-
munity. The law wisely requires that before
dividends may be declared a percentage of net
earnings must be carried to surplus until the
fund so accumulated amounts to 20 per cent of
the capital, and not only should this provision
be scrupulously observed, but the policy of every
bank should be to go beyond it, increasing its
surplus until it stands a guarantee of safety in
periodsof disturbance, and serves to make divi—
dends surer and larger. To this practice the
management of the most successful banks in
New—York City attribute a large measure of
their prosperity. and all of the most thriving
banks throughout the country pursue a similar
course. ' -
ADVANTAGES 0F CONSOLIDATION.
"After integrity and the exercise of safe judg-
ment in daily transactions, it is the one rule
surer than anyother to bring advantage and
success, for it insures confidence, whereby bush“-
ness is increased, and also deposits, making pros-
perity merely a. question of finding a profitable
use for the money. How true this has been has
freqUent illustration within the last_ few years
in the results following bank consolidations in
many commercial centres, the deposits in each
case having increased almost immediately out
of all proportion to the new business acquired
simply by the consolidation. The moral is not
to be mistaken. The public chooses, first, to
bank with institutions whose strength is an as—
surance of safety, and, second, where accom-
modation can be had most easily. Other things
being equal, the bank with the largest surplus
in proportion to its capital will enjoy the fullest
trust, and consequently command the largest
business, a condition which ought to convince
even the most greedy of stockholders to the ex-
ercise of patience if the dividends are restricted
for a. time in order that they may be more cer-
tain and satisfying, later on.” ‘ Such is the trib-
ute paid-by Mr. Kilburn, tothe methods which
have brought New-York banking institutions. up
to the. high plane of safety and power which
they now Occupy. and'which they hate held: for
long yearspast. - : ‘-. | , , :
.Leaving~the National and State-banks, the
trust companiesand. savingsinstitutions out of
consideration, the number and importance of.
private banking-houses within the limit of New-
York. City command widespread attention and
res—ecu ~These number in the hundreds and
represent millions of capital. The banking and
brokerage business. naturally, in a commercial
and financial centre like this city, go hand 'in
hand. The annual, sales of stocks. bonds and
be made for some time, the advanCe'sheets for a.-
banks are correspondents of New—York banks;
and carry accounts here and are closely assocl—_
the banks’ reports, and the public by so much
investments,“ a gigantic. scale. The sales of
(bonds on a single day, during the last month
‘were' over $10,000,000, while thei'shar’es of stocks.
of all kinds average-r flomv:250;000 to 1,000,000.
daily. The value of those sales depends on the
.bull. or bear tendency of,.the,_ market. .While
there'are many who oppose the general idea. of.
private bankers—and among vthem,-“it-isr under-
stood, is the State Superintendent of Banking—
‘tlie recordof the past .shows that in .thegmain
these firms have conducted their afiairs with
strictest integrity'and honesty. Some point ‘to
the failure of- Grant-& Ward and others of a
similar nature to show the lack-of safety and
protection in trusting funds to firms and con-
cerns about‘whose [affairs they know nothing
except what the individual members may choose
‘to give out.» If there could be a systematic-in-
vestigation byState‘officials ,jnto the affairs of
these firms at stated periods, then the public
glauld be in a‘poSition to place confidence with
em. '- -
As a rule, the private banker and broker is
engaged in the buying and selling of securities.
While he will accept deposits and pay interest,
he does not seek this business.‘ His customers,
who are investing in stocks and bonds, place
with him a sum of money suflicient to cover
their operations, and this he keeps and handles
for their best interest. At the same time, many
of the private banking-houses have been . in
business such a length of time, and have earned
such an excellent reputation for soundness and
stability, that the confidence of the public 2::
placed with them almost to the same degree as
it Would be in the ease of a regular corpora-
A FEW LOSSES.
In spite of every precaution the biggest and
most conservative financial institutions of the
city have been made the victims in the past of
dishonesty on the part of some u'usted em-
ploye. Sums ranging from the thousands to the
hundreds of thousands have been embezzled
and misappropriated. Among the many cases
in the last few years may be recalled the loss
to the Harlem River Bank of $20,000 by a book-
keeper; the defalcation of Tait, the paying tel-
ler of the Chemical National Bank, and the later
affair of. a. cashier of that institution; the large
sum lost by "the Shoe and Leather National
Bank through Seely; the swindle perpetrated
upon the Mercantile National Bank by Quigley,
who got away with $144,000, and many other
cases which require no‘ mention at this time.
These instances are related for the, purpose of
calling attention to the great care which is ex-
ercised at all times by New-York institutions
to prevent losses of this nature. Considering
the lmes‘ which have occurred in other great
cities of the United States, New-York may well
feel proud of its record in this direction.
The year just closing has been notable for the
large importations of gold from Europe. The
movement which began in the early spring cul-
minated in a total of $70,000,000 of the yellow
metal. In the middle of the summer another
F
a-movement started Which resulted 'in an inward
flow of gold, which is still going on. The bal-
ance in favor of the United‘States‘with Europe
is yet of such enormous proportions that when-
_e.Ver a. cry has been started by timid ones it
has been pointed 'out‘as a. safeguard against
"any backsliding‘ on the part of the prosperity
which has been surely gaining headway with
each month since' the war closed. Financier-s
recall the ”dark days of 1894. when in June of
that year the draw upon the gold of the United
States had been so steady and depletmg that
a meeting was called of New-York bankers to
decide upon some action for assisting the Gov-
ernment in stopping the failing Treasury sup-
ply. At an informal meeting in the Clearing
House many of the leading bankers discussed
the situation at length. It was pointed outfby the
president of one of the leading financial insti-
tutions of the metropolis that in his opinion
75 per cent of the manufacturing plants of the
country were hanging in the balance between
solvency and insolvency. The Treasury reserve
was then down to $65,000,000, and it was argued
that the New-York banks should spare some of
their boarded gold to help Uncle Sam. While
this was not agreed to, the bankers all protest-
ed their willingness to help the Treasury by
every means in their power.
Compare such a period with the present one,
when gold is so plentiful that it is handed over
the counter for the payrolls of manufacturing-
plants. To-day the advance wave of prosperity
which was predicted two years ago has gained
a headway which is sweeping the nation on once
more to success. and good times. The banks
have all the money they can handle, and dur-
ing a great part of the year the 10w rate of 2
'per cent was obtained for call money, and at no
time has it begun to Show evidences of reach-
ing a figure where it could be considered high.
Under such influence there has been a remark—
able stimulus ior speculators and investors to
buy stocks and bonds and securities of all
classes. Wall Street can look back upon a. year
of exceptional advantages and opportunities
which have resulted largely from the condition
of the money market. It has been easy to ob-
tain large loans at easy rates of interest, and
many have been induced to operate for this rea-
son’ who might otherwise have been kept out of
the field. '
" EFFECT OF THE WAR WITH SPAIN.
The result of the war has opened up a new
territory 'for American bankers to do business.
New-York has been among the first to jump at
the chance, and in Santiago there is already a
branch of one of the metropolitan financial in-
stitutions. Inasmuch as there is now a. defl-
nltely outlined policy of foreign trade and Na-
tional expansion, this foreign department of the
banking business is destined in time to be a.
most important One. In times past the one
great obstacle to' American. manufacturers do-
ing business in the countries of Southand Cen-
tral America, Cuba and. Mexico has been the
lack of American banking-houses through which
to collect drafts and transact other business ire-
lating to collections on goodssold on time. The
‘3, per cent war loan ”which was issued during
the present year created conditions which taxed
the reserves of the associated banks not a little,
but the danger, if: any, Iwas “safely passed
through, and themoney situation emerged from
under the. temporary ,cioud even stronger” than
'it was before. The bond issue was ‘for $250,—.
. . ,000‘. The: payments ’which'» were made
through ‘New-York bank's took out - a.” large
amount of money and transferred‘lt"toiwash-f
ington. The Weekly"s'ta.tements of the' Clearing
‘HouSe showed for ~'seyeral weeks It decrease 'in
the reserves of the banks. and this was used by
the bears on the Street a an argument for
- pounding" down 'prices.’ ' ’
There‘ was a well-organized effort made in cer-
tain quarters to create a small panic by placing
grain aggregate an enormous sum and require “serve.
'too much weight'upon the decrease in there-
‘ The intrinsic merit of the monetary l
l
situation is not better-shown than tn the m .
net in which .the market stood up under thfl
depressing influence. It was clearly pointed
out- at. the time that the payments. aux-the.- wt
bonds were the cause for the loss in reserve;
made in full the situation changed about and
the reports of the 'Clearing House began show-
ing gains,1 and within three or four weeks the
records for loans and deposits were broken
'twiceiln succession; 37¢ .' . ' » e'l‘ €'
_ The year 1898 has been free from any bank-
ing disasters so far as New—York is "concerned.
During-the fall one of the old institutions of
the city, a National bank, closed its doors ,
went into the bands of the Controller of the
Currency. Upon-examination it was toundfih
in all probability the depositors wouldibe‘fpal
one complaint which might be made is that the
diflferent banks have so much money they do
not know what to do with it.
. ' ‘THE FLOW OF GOLD.
This year the imports of gold have exceedd
the exports by $14,947,432 in October and $129,-
596,246 in ten months, and at the same time
enormous credits against other countries ha?!
been established which could hardly be ex;-
hausted ‘by two full years of especial adversity.
When it is remembered that the largest excess
of imports over exports of gold ever realized in
any fiscal year was less than $97,500,000, even
with the extraordinary foreign demand for
American products in 1881, and that in no other
year in the history of the country have not imp
ports of gold been within $52,000,000 as large
as in the ten months ending with October, the
importance of the industrial and commercial
revolution in progress will be in part appreci-
ated. It is not entirely an encouraging fact
that the net exports of. silver for ten months
have fallen about $1,600,000 compared with last
year, since it indicates shrinkage'indemand
“abroad and in production here, though the do?
crease has been partly due to circumstanca
which are presumably temporary. As a.
product alone, in connection with the mining. of
other metals, more silver will be taken out
than this country can. use as money or in the
arts, and a decrease in foreign denmnd affects
the country just as a decrease would in some
other commodities. .
The following list gives the associated banks
of the Clearing House, with their capital and
net undivided profits: . '
\ Net '
BANKS. .1 W profita-
Bank of N. Y. Nat'l Bky. Ass‘n.... $2,000.“ $1,858,”
2,036,“
Bank of the Manhattan Company. . . . 2,0§0.000
Merchants' National ................ 2,000,000 1,061.”
Mechanical National ..... . .......... 2,000,000 2, .100
Bank of America .................... 1,500,000 2,612.5“
Pbenix National . . . . ..... . .......... 1,000.“)0 243,4”
National City ....... . ......... . ..... 1,000,000 4.322%
Chemical National .................. 300,000 6,996,413
Me rchants' Exchange National. .. . 600 000 176.1“!
Gailatin National ............... . .
National Butchers and Drovers’. ..... 800,000 121,200
Mechanics ' and Tradus’ ......... . .. . . 400,000 174.”
Greenwich ................ ‘9 ......... 200,000 172.0“
Leather Manufacturers National. . . . 600,000 482,6“
Seventh- National . .' . . . . . ........... . 300,000 100,800
Bank 91 the State of New—York. .. . ._. 1.211000 ._ 518,300
American Exchange ‘ National. .. . . 5,000,000 2,610,”
National Bank of Commerce. . . . . . . 6,000,000 3,632,000
National Broadway . . . . . . 1,000,000 1,627.“
Mercantile National . . . . . . 1,000,000 1,013.6).
Pac dc ................. . . . . 422 700 , .479,“
Naticnai Bank of the Republic .' ..... 1,500,000 834,109
Chatham National ' . . . . . ; ............ 450.000 ssssoo
People's ............................ 200.000 264.800
National Bank of North America. . . . 700, 000 554,
Hanover National .................. 1,600,000 2,240,200
Irving National ..................... 500,000 368.
National Citizens' .......... .. .-.. 600,000 87810.
Nazsau ........................ . 500,000 2E0,”
Market and Fulton National.
National Shoe and Leather... _ .. 1,000. 159,”
Corn Exchange ........... . ......... 1,000,030 1,200,800
Continental National ...... ‘ .......... 1,000,000 605,200
Dricnlal ............................ 300,000 403.6”
Importers and Tradsrs’ National..... 1.500.000 5.615.100
National Park ............. . ........ 2,000,000 3,235.
East River National ...... ... ....... $0.000 154.7%
Fourth National ......... . .......... 3.200.000 2.030,“
central National .................... 1,000.00!) 510,000
Second National .. 300.0“) 721,100
750.000 7.500
Ninth National . . . .
First National .....
New—York National ..
Bowery .......................... 250,000 614,200
New—York County National .......... 200.000 $0,300
G‘rmun—Amcrican .................. 750,000 277,300
Chose National ..’ ................... 1,000,000 1,129,000
F‘A‘th Avenue ....................... 100.000 1.170.100
German Exchange ............... 200,000 575.900
German‘s. ............... . 200.000 754.200
L'ncolrx National .....
Garfield National . . . .
Fifth National ............ 200.000 ,
Bank of the Metropolis .............. 300,000 862.”
West Side .................. .._. ..... 200.000 351,230
Seaboard National .......... ‘ ........ 5 00,000 384.2”
S'xth National ...................... 200.000 349.300
We-tsrn National ................... 2.100.000 767.700
First National, Brooklyn ............ . 9.00.000 V 954.61!)
National Union ....... ' .............. 1,010,000 948.5%
Liberty National ..... . 500,000 335,9”
New—Yrrk Produce E). g . .. 358,8“)
Bank of New—Amsterdam ........... ,000 310.3!»
Totals ........................... 58,52,700 75,911,”
The following is a list of non-member banks
showing the capital of each:
NE W—YORK CITY.
Banks. capital.
Astor Place .............. . ....... ........ $250,000
Colonial ' ' ”...... 100,0”
Columbia. ....... . ...... 8m,”
Eleventh Ward... ............ .. ..... 100,”
Fourteenth Street .................. .......... 100.000
Franklin NationalJ ......... '.......'.......'.....‘. 200,000
Gansevoort ..... .'..... ..... .‘.'......‘.'.'.'..:..'.."‘"”0.”
Hamilton ....... .... $0.”
Hide and Leather National- ....... ....._.......v. 500,000
Home ................... ........ ......... 100.”
Hudson River........‘. ..... .......... 200,1!”
Mount Morris........'.....-......’.' ' 2150,”
Mutual .....-..... =‘ .....; 200,000
Nineteenth W .. 100.0”
Plaza ...... .. ..a:...... 100.0”
Riverside .' ....-..... 100.0(1)
State ....................... . .. .‘ . ‘ 100.000
Twelfth Ward. ......... ...... ........ ........... 200,”
Twenty—third Ward...... ....... ...............! 100,0”
Union Square ...... ..... ............ ............ 200,”
Yorkville ....; ....... ...........................'. 100.0”
Astor Rational..............................‘.’..'. 800,0”
' BROOKL . ‘
Redford ..................... .................. 150.0“
Broadway .... ....uo----.o.u.....oo.oeu~e.-u 1N.”
Brooklyn ...'.... ........ ...... ................ 800.“
Eighth Wtrd........”.......................-.. 100.000
Fifth Avenue.'............... ..... .'............’. «1M0!»
Fulton ......................................... 200.”
Kings County. ............. ..................... 150,0!»
Manufacturers National......'................~.‘. 252,00)
Mechanim‘ ........... .............. ...... 500,0“
Mechanics and Tinders'u ..... ‘. ' .....‘i 100.”
Nassau National “‘.... 500.000
National City. ...... 300.000
North Side.. . .;....- ......'..' ~100,ooo
People's .-'...'... ..... .. .......-..._ 100.”
Queens'Oounty, 14mg Island City...,........... IN,”
Schemerhorn .....".........'..t'.....'.."....'.'...'.'... 100.000
Seventeenth Ward............................,.A., likg
Sprague National..'.'.'.'..'.'........ ...... "‘...”... ’ ”0.
~.'I‘wenty—ulxthW’ard ......‘..'.‘..‘... ' .. nuns
Union .....,._....... ..,...........,I. .fi. no fl
Wanahout ..'.a..;......Q.‘........;.‘-........ ’.. room
First National. Jersey City. . . .. '. . . . "an..." long
Hudson County National, Jersey City........._.. 250,
Second National. Jersey City.............. '.- 250,0”
Third National. Jersey Clty.............. .2113.”
First National, Hobokon............. 110,”
Second National, Hohoken........... 125.00.
Bank of Staten Island............. 13,3
First Rational. Staten" Island.....'.
Tom O~UOIC”INOIOI..-.‘.......-.'éCOOIOOOQC'Pkim“
and just as soon asfthe' \paymentskwere about .
in full. ‘As the year-draws to a Close the only.
Norwalk Chronicler