The Bismarck Tribune Newspaper, February 15, 1921, Page 2

PAGE TWO BANK OF NORTH DAKOTA HELD = ~ BELOW LEGAL RESERVE AMOUNT A part of the testimony given be- fore \the house investigation commit- tee yesterday was an examination of ©. BE. Lofthus, state examiner, by At- Dakota. A. I examine the loans and discounts, verify them with the books examined as to value, list or prove the real estate loans and we assume torney John Sullivan with relation to : thai the values in the real estate loans HE BISMARCK TRIBUN of this amount, that js, of the re- serve, shall consist of balances due to the association, meaying the bank-— make a note of this so you can figure it—from good! solvent state or na- tional banks or trust . companies: which carry sufficient: reserve to en- title them to act'as depositary banks, | and ‘are located in such commercial centers as will facilitate the purpose of banking exchanges, and which de-_ positary bank shall have heen first approved by the state banking board; Q., Well. two-fifths would. be forty,|;,°Q. Was the ‘cai percent? A. Yes, « jean: bank an-approved depes'tary r 99 ‘ . re 9 Q. Forty percent of the ,/amount | Qetober 22, 1919, Mr, Lofthus? A. es, sir. f you have referred to amounts to how / Q. Well, lets figure that out and much? A. $609,917.85. 4 Q.. Then on the thind day. of .De-|.see haw the reserve looked at that time. It appeared to have on -hané cember, the Bank of North Dakota, tor have had its.cash reserve, up to|liabilities subject to demand, $914,- the requirements: of: the law should 124.06. That would come under the have. had’ on hand $609,767.63? Now| 1915 act> wouldn't it? A. Yes. Q. Well, at that time. it required will you make that deduction and tell us how far the Bank of North Da-| twenty percent of its demand depos- its, so to figure that out, you’ would TUESDAY, FEBRUARY? 15, 1921 - They liké Dr. Caldwell’s, and it qu:clly relieves their constipation and headaches. Mothers! Give The Little Ones Syrup Pepsin kota. on Decem| tl low + ‘ the reserve of the Bank of North Da-‘ufter going through « committee are of the state of North Dakota. Naw. its cash reserve?” pee ritogs bake’ first. twenty. percent of SLi BEGIN toteach the chiid regular daily ood kota and the Scandinavian-American . $0 we don’t go out and try to’ that simpJy means, does it not, and) Q In. other words, the Bank of| 124.06, wouldn’t you? A. Yes s'r elimination as young as possible, if a bank; The testimony, as shown by the official transcript, follows: Q.. One of the principal require-_ ments of, the statutory law of the liabilities, A. Yes. reserve may be in the, depositary Q. ‘They should have had that } $454,668.63 and under that act you arising. 1t does not then interfere with state, outside of the bank regulations; @, Now will you explain to. the banks? A. Yes sir, much more cash on hand? A. Yes| take ten percent of that amount? A. play, school or work. 3 by the banking department, one a tee just why there is any Q. Reading furthers “And the re-’ sir. Yes, sir. When in spite of your efforts a mem- 1 the particular legal requirements is, ty for a reserve in a bank. maining two-fifths of such reserve Q. And that is without making the} Q. And that would amount to $45, ber of the family becomes constipated, i in the matter of the reserve of the bank? A. Yes sir. Q.. Now explain to the committee. Mr. Lofthus, if you will, just what is! meant by a bank’s reserve? A! bank's reserve is available cash, cith- er in the vault—certain percentage | in the vault and the rest with ap-; proved cor ndent hanks. y the value of the real estate We cxamine all the assets of ank and verify the assets and We will assume these men are not banke We will assume these men are bankers? A. The necessity for reserve is because we don’t know at any time what the demand may be. ang we assume there is going to be some demand each say and the re~ serve is to be able to pay such a de- mand when it is made. is construed by the banking depart- ment, as of the reserve in the depos- itary banks. that is three-fifths of the shall consist of actual cash on hand?” A. Yes sir. 9 Q. That means that in each state bank in the state of North Dakota up. to the time of the special session of 1920, when the percentage was changed a little bit, two-fifths of the bank's reserve funds must be actual cash on hand in the vault? That is! Q. Now, lets see what that amounts ‘to? A. $182,834.80, Q. Now, add to it the time C-Ds North Dakota;.was short in its re- serve undge this. statute, $563,150.22? A. In cash. 466.862 A. Yes sir. In the exami- nation. of, banks, this _ mattor—the customary way of examiners—they deduction, the deduction I refer to would be the amount the Bank of North Dakota’ owes other hanks, which should be deducted from’ this| had never examined it in that way. amount, that is from the amount they Q. Well, the statute had it that had on hand? In other words, the| Way, didn’t it, or did T misread the amount of money that a bank his on | statnte (reads). Each association hand, to determine what its reserve} shaJl at all timcs have on hand in is you must deduct>from the amofini} available fun¢s, an amount which, and much constipation wai be avoided later in life. The most convenient hour throughout life is immediately upon give Dr. Caldwell’s Syrup Pepsin in the size dose directed on the bottle, It isa mild, gentle laxative safe for young babies; effective for grownups. It is the largest selling liquid laxative in the world, and most economical as a sixty cent bottle will last you many months, For your information, Dr. Caldwell’s syrup Pepsin is acompound of Egyptian TRY IT FREE Q. Now lets explain about that} @, In other words the reserve of correct? A. It should be. Yn. hand the amaunt it owes othe: deducting therefrom, the amount y d i i , 2 7 2A. a . 5 : } er simple laxative herbs right here---what_ is meant by ar!) bank is the money that is availa- Q, Under the law? A. Yes. hanks? A. I don't remember just other banks all equal twenty See a ee cent aati aro- ’ Send me your name and ad- proved correspondent, banks cee any minute for payment immed- Q. I assume that that is one of the, how the Inw reads. : percent, of its demand deposits and matics. Look on it as a good family dressand 1 will send sowafree , proved correspondent banks—there is upon demand? A, Yes s:t- particular and principal reasons, Mr , Q Well), we -wil] read it: “Bach | ten percent of its time deposits? A. friend, useful fo relieve constipation wil ble of my Syrup Pepsin, an application filed with the baniins | first thing association shall at all times have on | Yes. | and symptoms like headache, bilious- Add: ress me Dr. W. B. Q. And that is the banks, protec. Lofthus, why the you ? | 5 4 hoard. j ltion against insolvency isn’t it? A mamed as the duties of the bank ex-; hand in available funds.in amount’ Q. Have you added those two fig- ness, colds, fever, bad breath, loss of well, 513 Washington Street, ‘Bal. . Q. By some hank? A. By some) vey sir, aainer was to count the cash? A. Which after deducting therefrom the| ures togetiicr, Mr. Lofthus? . A. appetite and sleep. It is no exaggera- Monticello, Illinois. Every. bank, you—with the bank examiner} ” Beene i hank cannot, Yes Slt. amount duc to other banks shill | $228,290 98. tion to say that millions of families are body now and then needs.a it doesn't come hefore the banking 20, Recniae ww sa ‘ mt oo oh Q. Now, thens let us apply that Cal twenty percent of its demand! Q. The total would he $228,771.67, never withouta bottle of Dr. Caldwell’s laxative,and it is well to know | hoard, but. we ascertain, if it is a Le ot iiaiteee, a Finer words Mr. Lofthus to the balance sheet teposits?” A. Yes. lis that right? A. $228,298.98, Syrup Pepsin. Itsafeguardstheirhealth. the best. Write me today. bank that we are not familiar with Bilis rosetee omelet below the statement of the Bank of North Da- Q. Now, I will show you the bal-| Q. Now this statute says you must —we ascertain its standing—before aGutts atcoresanecdewianads ix, kota, as made by Bishop, Brissman ance sheet of December t and| have on hand in “available funds, an we approve it as a correspondent P demand upon i.’ od company, under date of Dec. 3 ask you whether or not the item} amount which, aft deducting: the bank, Q. Now then, you take into con- Yes. then it is insolvent, isn’t it? .A. . Now then, Mr. Lofthus, | think you have explained to us the man- In figuring reserves, first, we take the demand deposits, do we nat? A. amount due to other banks”—then we would take from that amount due to “due depositary banks” would be at least one of the items that should he they were correct, did you? A. Ye Q. Did Mr. Thatcher include ; pany? AS No, sir. services of the Equitable Audit conte sideration, in determining the re-|20" 4 inuth ‘ nN. Yes. sir. @educted.. A. We don’t have any} other banks?’ A. That would be the . » i serve, the cash that is in the bank? ae of your erga ates of BN; OF- Q. Well, individual ‘deposits woul situation like that ‘in the state banks.| way then. ; f that statement from which I} | Q. Somebody did suggest it, -I age ee A. Yes. dinary, state; bank Now. 1. ant 10 be demand deposits,’ wouldn't they? Q. Excepting in the examination of] Q. The ‘atidint due"to banks was/| taken these figures, this predominat- sume? A, Well, they were there og Q. And also take into considera-|irect your attention to the examina-. 0" Veo" a, a depositary bank? A. That is all,| $572,904.10? A. Yes. ing idea, “the bank is in good liquicl] in the city at that time. & tion the amount that is deposited] ton a eee permitted to make “9 “Due depositary hanks would he "d I am not clear on tbat. 1" @. Gan you make that deduction,! condition?” A. I presume that is a) Q. Did you say they were thereg with these approved depositaries that ane he shaw of the Bank ore demand deposits, wouldn't it? A. @ Haven't you some depositary | Mr. Lofthus? A. Not very wei trne copy. A hey Ae Nee Mea ne x you refer to? i aiftarences da tt ‘aan ot Peet fthus, Yes sir. state banks in this state that you] Q Well. make the dedicticn on the} Q. That is the original?” A. Yes.) Me Sullivan: say they weré Q. Now, let us make that plain to} o netantial alte ute ie a ee us "Q. Public treasurers’ open accqunts | €xamine? “A. I don’t think we have minus and we will see how mun we] Q. That was Mr, Thateher’s idea. pee e Cran t the committee, I have prepared a Its (yo rinus, WaLcenc ine and 2 Ne would be demand deposits? A. Yes Ver two or three. ao are short anyhow? A. % 3.12,| however? A. Yes, sir. : Hs mo ion of a rsreeman, sscond tle memorandum on it Mr. Lofthus.} 700 imposed 1 an # a dee ie 2 sir. . Q. Well, the Scandinavian-Ameri-| providing my figures are ¢ te Q.. And that wags your idea ‘also a y vai yee adjournment wag \ and I am going,to give you a few} ii, Wetarantae Mo Sout euainait Q. And public treasurers’ sinking C2” bank was a depositary hank, was] Q. They may be a few cots off: yr. Lofthus, or did you just take OR iRaaee et ay Me : " minutes to look it over and compare] Orin e state banks of the state anc {nds on-open account would be de. it not? A. It was at one, time. It| but they are, substantially corvcct, their word for the situation? A. 1) Bnq of Heed 14th, 4921 ; Zw i it so you will have it im your mind./thGity that the law imposes upon Mand deposits, where there had been | has not, pen for. fhe past year. T think, ‘Then at that time avd o¥ | yeiieyoe that was the condition, | pla Arian io Pie Recess taken fori20, minutes, after you with reference to the Bank of 2° C-Ds issued for them? A. Yes. ell, under this statute, you| that theory and following this lnwj-.q, condition that youl poutah Lignite Coal $5.50 and iH which meeting called to! order with all parties present and the examina tion of Mr. Lofthus resumed. North Dakota? A. Yes sir, there is. By sending out letters to the state Q. Now, you can figure this very shortly, by reference to this state- ment, I think. The total of the de- would deduct the amount due depos- van banks under this section? A. Yes. the Scandinavian-American bank had, $344,613.12 less than ho reserve 3 all, didn’t they? A. It appears tha zaply took Thatcher’ W it, | believed it was a fact. word for it? t how did it occur that Bear Creek Coal $12.50 deliver< ed. Wachter Transfer Co.. Phone Q. Mr. Lofthus, you gave us an, “easurer, to. all county treasurers | OO iv ciuding certificates of de-|__@ Now, you. would deduct the} way from that way of figuring. | s hired to make these itemized statement of the things you fe ah Own treasurers: and schoo) | rates “ae papas on the balance sheet, 2Mount due to depositary banks from| Q. Now you may check those fig- | > this examination 62 or alae or your examiners do'in connection halbace aeroes ~' ts $15,298,923.40. The certificates of available funds. Of course, you] ures up Mr. Lofthus, with the report A. Why, TRIBUNE W “FOR. RESULTS e with the examination of a bank, which Q. Now, youl can inelude those first. deposits which appear to be time de- oe it in this instance, be-} {from which I have taken them, signe: uke NE = T have tabulated as fourteen different three lWconacatatement cant Vousnot! posits and which are included in that | Cause th amonat in this statement by” yourself as state examiner anc | the andi things. Now. there was another mat- ay aS * amount are $169,923.02. ‘Now, then, is $1,192,969.76? A. Yes, sir. Mr. Thatcher for the Equitable Audit! Q. e enough help ter that I think, possibly. you over-|4-, Yes sir. if you subtract the certificates of-de-| @ And you couldn't very well de-| Co» (hands report to witness.) Mr. | your’ Q. That is, the examinations ot is n duct that from $46,000,000 could you? loans and discounts and proving A. No. Mr. Sullivan are von not in Thatcher signed this report with you,| A. 1 looked, Mr. Lofthus, and that was the did he? A. Yes, sir. ! sit, which are ti rtificates. | question of verifying the accounts of ponit, which are Cine 3 cen from the total of deposits. it would; gone over thoreughlywby what I con- inscy tedehs 10 ve ¢0 ‘ee K inced korean). at pd ) is that it?! T T a: help yes. but I wanted it rere) FA ? . . Obtata { i the state banks, with other corre.| Teal estate loans can be included it error in figuring this $46,767.63? 0. And which one of you Mr. Lofthus; | sider re etficl elp tha ad spondent banks? A. Yes sir. I ver {the statement that you examine thc leave the demand deposits? A. Yes/“ gy have only taken the cash side| if you now remember, prepared these ety eae et Mae k ee rey af rts for fer brevbore te Ketan sp a 2 AL Ss sir. oF | ests and ‘liabiliti it the bank and. Sir. i he h side} if you now r ber, prepared these | at that time. IK 6s, Station & New York. Become slendes ify that by sending out letters. BBte Ss a i ili He 0 M a am Q. All right. Will you do that? of the reserve, the two-fifths side, of figures in this report to the supreme; Q. Do you know who it that. by bent method, eee, some role, sonteree Q. You send out ‘ictters to corre-| Verity them by sending out these let- y, it. If you can figure the other side| court? A, Mr. Thatcher prepared | suggested to you that in your search rypid reduction: Improves ; 5 ters? A. Yes si A. Yes sir. 1 > 5 3 i} spondent banks? .A. Yes. ers? A. Yes sir. Q. You have done that? A. Yes of it, I would be awful glad to have| the.figures. ~ | for competent help you might get the!| Your"? Q. And then you take the Iette: that you get back from the co spondent hanks as tp the amount of balances that the bank being ex amined has with the correspondent banks and see whether the amotint agrees with the amount that the bank being examined has on its hooks? A Yes ‘sir. ‘ Q. Now then Mr. Lofthus, let us balance those fifteenyitems against your examination of the. Bank of North Dakota, tell us wlfit you do in the matter of the Bank of North Q. Now, that is about a short anc concise statement of your examina- tion of the Bank of North Dakota, isn’t it? A. Yes sir, Q. In other words, you have na power under the law in your office to give any directions to the man- with reference to their compliance with the laws? A. No sir. « Q And you have no. power to re- quire the Bank of North Dakota, 07 its officers to do any particular 01 specific thing, have you? A. No sir Q. Do you have any power under the law, Mr. Lofthus, with reférence to the Bank of North Dakota, to di rect or supervise the affairs of the | Bank of North Dakota, such as You have with reference to state banks: A. No sir. Q. Then the matter of state hanks I think you said that you direct, sup- ervision of their affairs, and may di- rect them in the manner of the con- agement of the Bank of North Dakota: ; | Q. Will you tell us then what were ; demand deposits in that. bank ‘4810! that date? A. $15,129,000.38. | Q. Now, then, in order to get at this correctly, we would then have tc. | deduct, would we not, the amount | due to other banks, how do you make; that deduction, Mr. Lofthus, but no, | you would deduct that from the re- | sult, wouldn’t you? Now then it says: we must’ have on hand twenty per-! cent of the demand deposits? .A.' Was this on the third day of Decem- ber, 1920? ‘ Q. Yes. A. Well, we are work-' ‘ing under the new reserve then. Q. On the third of December? A. !On the third of December, 1920. The} reserve law went into effect July 1 20. i Q._ That 1919 section hasn't got ‘it’ i in., It was not put in until the spe | cfal session’ of 1920? special session was held in-‘Decem: ber, 1919. A. Well. the), Q. And you took his word th you do it. A. Oh, yes, all right. Tee 111 AR 1) 11 tome 11 dD OTT RONG 11 opment ut 4 5 “ ices Of Mr. Thatcher we Highest Food Authorities tell why Karo is one of the greatest of all -_. energy-producing foods - and the call TV En aT Every father and mother should read this message SL peONO Lit HRA 11911 OO ae TT Thassmualll \ duct of their business so that they must bring it within the provisions) @% Do you remember-what the per-_ j of the law, and vegulations of: the | centage is under that new act? A. ‘ a. state banking department? A. Yes roa By tan perce on fomand de-| 5 : i i . That power, sj Ss percent on time. i ore H : \ tirely absent with trance ig your'| Q. Well, you take the amount due . RE is ‘much m than the deli- Your Protection 7 duties in the Bank of North Dakota? } from sgiher hanks after you sind out | cigus taste of Karo to account for the : ; A. It is. " / AL Yes. | 1 jo not be deceived by cans containing syrup that @. And asa matter of fact, all you 9% You say: you would take ten . fact that more than two hundred might look like Karo. The name “Karo” is on every are permitted to do, substantially. ' ct of the demand deposits? A million:cans were sold last year, can of original Karo—look for it, and be assured of : under the law with reference to the: ! He of, full weight cans and highest quality. i Bank of Novth Dakota. is simply 10 OQ. Wel, that would. be how much? It’s simple enough, when you know that i ighest quality. ; see that the figures ‘on the books are! 4 012,900.00. ft Karo. is perhaps richest ods i 4 foe < kept correetly and properly _ added, terseen you take the time depos-: Dext the t of all fo iy BLUE Karo M Use Cuticura Talcum subtracted. etc.? A. Yes, and also! its. Your time deposits on December extrose. And Dextrose is one of the ‘Tho standard table syrup; Also for cooking, baking tq . to call attention in my report to any 3rd, as shown by the Rishon. Briss. most important food elements there is. and candy making, Light brown color, delicious flae . ‘ irregularities or any eriticism 1/ man report as $169,923.08. Now, wn-! r te To Powder aud Perfume might have as to. their method of der the ine special session, you! i Y, ' le daunpt dara pg ‘ An ideal face, skin, baby and dusting. keeping accounts. to the Industria]| Would take seven percent of that.( i z z 3 powder. Convenient and NOT | Goeiatealh j ‘wouldn't. you? A. Yes air, $11. i ou could not live long RED Karo , cal, it takes the place of other per- Q. In a state hank, however, you 894.61, \ without Dextrose " The Ideal Syrup for every use—for cooking, baking, i 3 fumes. A feW grains sufficient. jolu cvers wi ». Soap 25e. Ointment 25 and bic. ‘leur oe. WRB Caticura Scop shaves without mus. s}can direct them yourself as to what to do when they violate the law? A. Yes sir. Q. But in 'the Bank of North Da- Q. Now, then, that would be seven percent of the i Yes sir. ‘Q. Now, then in, arder. t time depasits? A.; fing the | -Most of the foods you eat—such as bread, starchy vegetables, and all forms of sugar— candy making and preserving, Because of its hone; like appearance many prefer it as a spread for cakes, biscuits, breads. ? \ kota, if you find any violations of total reserve required! unjlev thia law, : ioe the law, in the Bank of North Da-| Yon would have to add the seven per- _ haveto be changed into Dextrose before GREEN Karo ; : i kota, you call the attention of the Im-, cent of the time deposits to the ten; your system can th : dustrial Commission, which has Petcent of the demand deposits? A | use them as energy foods. Flavored with highest grade real map!o sugar. Very WHEN YOU ASK FOR ry | charge of the Operation of the bank, Yea. ( t So Karo may almost be said to be a pre- moderate in price—absolutely puré, The makers of a fe | ic those specific things that you may! Q. Well, add thoge and let us sec tae 1a ae Karo are the world’s large: of the highest grad iu 8 ( ' m di ted food. gest users of ighest grade ’ Ss B U Gi T Efe ane A. Yes sir. wt that amounts to. A. $1,524,-/ i ges . These are scierttific facts, maple sugar—over a thousand tons used annually. o be . And your duties or at. least (9*,04. i i A = NORTHERN your powers end with them? A. Yes; @. As I take it, you would deduct | E supported by the very highest medical and Y sir, ; it’ from the amount of money? A. et food authorities. Send for the free booklet Q. Now, Mr. Lofthus, in an exam-| We. have very few correspandent | tioned be! , : 4 : - E [ination of a bank, Just how was the | banks to exagune: Our state banks, ages low and read the facts. : 7 a regerv&. figure prior to the special | Very few of them act. as correspond- ~ 1 Karo is perfe sof, ey a x |session of 1920? A. I believe it fig- ent banks, for our state banks. Baie, 9. Pe rectly delicoue Svhether fos be REDUCTION ured 15 percent on time liabilities. .; Q Well, let us assume that there cooking, baking, candy-making, or preserv- 4 Q. Just a minute, possibly you) is not any.deduction from.that at all ~ ing: It’s the bes! f break: In Tailored Suits ; could get that better if you were re- peer the ae that you refer to, ! : f i t part of the fast for S ferred specifically to the statute, ‘wo-fifths of that amount. would con- millions o! people— pancak iscuit | (hands the witness statute). A. | 5:St or should consist under the law le—on es, hot bi ts, 4 $85 values now $50.00 $75 values now . $45.00 $65 values now . $40.00 | $50 to $55 value $37.50 $40 to $45 value $30.00 TERMS CASH Ending Feb. 28th, 1921 |! KLEIN | Tailor and Cleaner i ASK iene Grocer Humpty Dumpty Bread Produced by funds in most instances? A. Yes!only a few cents at drug stores,” It ay BARKER BAKERY | =: : acts without assistance, tastes wice, re 2 Q. Now, this act, with reference;rontains: no quinine—Insist upon — : —— - to reserves, provides that three-fifths | Pape’s! . \ t seamen 81mm 1 MMi EET gd (Se nm nah CF aed 11771 ll 1 OAL id i an TEST MME 1 R3 ao j deposited in the state hanks? Twenty percent on demand liabil: and ten percent on time deposits. Q. You would figure then under this statute that each association shall at all times have on hand in available fund an amount which, aft- er deducting therefrom the amount due to other banks, shall equal twen- ty percent of its demand deposits and ten percent of its time deposits. that is correct is it? A, Yes sir. Q. Ina state bank, let m2 inquire, how are the moneys that are due to county treasurers, for /instance—do you call these demand deposits be fore they were depcs'ted in the Bank of North Dakota? A! They weré carried in the individual ledger as individual or commercial deposits. Q. And that is also true, is it not, of all the public moneys that were They were carried as individual deposits and as demand depogits? A. All except such as were placed on C-Ds. Q. That was simply the sinking ;of cash on hand, should it not? A.! Yes sir. } ‘Pape’s Cold Compound” is Quickest Relief Known Don’t stay stuffed-up! Quit blowing | and snuffling!.A doge of Pape’s Cold | Compsund” taken every two hours un- | | til three doses are taken usually breaks any cold right up. The very first dose opens cloggett | ; nostrils and the air passages of the | head; stops nose ruaning; relieves | the headache, dullness, -feverishness. “Pape’'s Cold. Compound” costs - Or.as.a spread on toast. - Sells atic NATIONAL STARCH Cco., G.L. ‘Cenninghas, Mo. re Twin City State Bank Bldg., St. Paul, Mina. F N FREE A booklet every ———— parent should toad Tells all about the won- darfal food value of Karo; ex- plains the meening of Dextrose, and why children thrive on it. Sent free with the beautifully illusttated Corn Products Cook Of 64 pages. Write Corn, Co., Argo, IL J f BEN ca OIE | MS IN 1H Hae