come, more or less, into a position of stability. It appears that such a time has now been reached and that whatever analysis is made of national banking at this time will be of some permanent value. The purpose of the present volume is to give a picture and an interpretation of national banking in the United States under the Federal Reserve System. As a background for this extraordinarily important subject, there has been included in the earlier pages of the book, a brief history of national banking since the passage of the National Bank Act in 1863, with particular emphasis being laid on the growth of the system. The technical details of organizing a national bank are set forth; an analysis of both the Federal Reserve Act and the National Bank Act so far as they affect the management, supervision and general business practices of the national banks of the United States, is given. The Reserve Act itself is reprinted and carefully indexed so that it may be of convenient reference to all those who have occasion to refer to it. Needless to say, it is not the plan of this book to plead the case of the national banks, as differentiated from other types, nor to assume to speak for any particular system of national finance. All of the various types of banks that exist in the United States-national, state, and privateare not only valuable but absolutely essential in a financial structure as complex as ours of today. But as the largest national bank in the country, as a member of the National Banking System for more than half a century, The National City Bank of New York accepts with pleasure the opportunity to give both to other banks and to individuals, specific, useful and reliable information regarding various phases of national banking. NE NEW YORK CORRESPONDENT EW YORK CITY, the money market of the country, is also the heart of the nation's business organization. It is well nigh impossible to conceive of a bank located anywhere in the United States which would not, on almost any business day of the year, be in contact in one way or another, with this great commercial nerve center. From the standpoint of the banks outside New York, therefore, it is essential that a connection with a New York bank be maintained, and to the formation of this connection should be given the greatest thought and care. There are some elements of the relationship that will be preassumed as a matter of course; safety, credit accommodation under certain conditions, and the other usual banking functions. But within recent years there has grown up an idea of bank service which in proportion far transcends these fundamentals. Measured by this much broader idea, the term "National City Bank Service" has become a familiar and vitally significant phrase in the minds of those bankers who maintain a New York connection. "National City Bank Service" means not only the performance of those fundamentals of banking which are taken for granted by all those who deal with an eminently strong financial institution; it means also rendering in a wide variety of helpful ways the extraordinary and unusual services which only a very large organization has the machinery for providing. Domestic Divisions FOR purposes of organization, the domestic work of The National City Bank, outside of New York City, is divided territorially into units composed of various states. Each general division is in charge of a vice-president of the Bank, assisted by several other officers. This system enables the Bank to give the most minute care to the interests of its correspondents, since the various officers, by devoting especial attention to particular territories, are constantly familiar with all those financial, industrial, and commercial conditions which may have direct bearing upon a correspondent bank's business. The district system of organization means that every correspondent bank has a group of officers at The National City Bank, definitely assigned to serve the correspondent's interests in every way possible. Washington Bureau ONE of the most significant of the unusual services which The National City Bank of New York renders its banking clients is through the Bank's Washington Bureau, which is maintained for the purpose of giving personal representation before the Treasury Department and similar government divisions. The functions of this Bureau include: 1-Performing the duties of an agent in connection with counting and verifying worn and mutilated bank notes, witnessing their destruction, and examining at necessary intervals bonds on deposit with the Treasurer of the United States as security for circulation or public deposits. 2-Attending to the details in connection with deposits, withdrawals, substitutions, or transfer of bonds for postal savings or other accounts, and the collection of postal savings bonds. 3-Receiving interest and coupons on bonds held at the Treasury, and transmitting coupons or effecting collections as the owners desire. 4-Notifying banks by wire, if requested, when the Comptroller of the Currency calls for a statement of condition. 5-Answering inquiries from correspondents on matters of record in the various departments or governmental bureaus, which are available to the public. 6-Furnishing copies of bills and resolutions introduced before Congress. 7-Supplying copies of Supreme Court decisions or other public documents, as well as rules and regulations promulgated by the various executive departments, boards, and commissions, such as the Federal Reserve Board, etc. 8-Attending to matters relating to government contracts and filing bids with necessary deposit of funds to guarantee them. 9-Filing of applications for passports, and attending to matters relating to patents, copyrights, land titles, pensions, services, claims, etc. Any of these matters will be cared for, without charge, for any of The National City Bank's correspondents. Every bank that is a member of the Federal Reserve System, or which contemplates at some future time entering the system, will find the aid given by such an organization as The National City Bank's Washington Bureau is frequently indispensable. Interest on Balances-Collections To its correspondent banks The National City Bank of New York pays the maximum rate of interest allowable under the rules of the New York Clearing House Association. The Bank receives at par for their credit, its correspondents' items falling under the discretionary rules of the Clearing House. Those items upon which an exchange rate is obligatory under the Clearing House regulations are received by The National City Bank of New York for correspondent banks at the minimum allowable rate. Trust Department THE Bank, through its Trust Department, is authorized and prepared to act in any fiduciary capacity in which trust companies and state banks in New York State are permitted to act. Among the principal functions which the Trust Department performs are the following: For Individuals Executor and trustee under will; Administrator of an estate at the request of the heirs; Guardian of the property of minors; Committee of the property of incompetents; Depositary of property placed in escrow. For Corporations Trustee under mortgage or indentures securing issues of bonds or notes; Transfer agent; Registrar of stocks or bonds; Fiscal agent for the payment of dividends and coupons, and principal of bonds and notes; Depositary, as follows: Under escrow agreements; Under voting trusteeships; Under reorganization or adjustment agreements; Of subscriptions to stocks or bonds. THE Trust Department will be pleased, at all times, to assist the clients of the Bank in solving their fiduciary problems. Custodian of Securities FOR many years, The National City Bank of New York has maintained a separate department, the sole purpose of which is to take care of securities. Apart from their physical safekeeping, the department attends to the collection of coupons and dividends as they fall due, and principal when it matures. The Bank will make such disposition of principal and income as directed. Under special arrangements, this department keeps investment accounts, renders statements thereof periodically, and furnishes data for income tax returns; also, it endeavors to notify those for whom it acts in this connection of subscription privileges, securities called for payment prior to maturity, and requests for tenders of bonds and notes for sinking fund purposes. In general, this department gives expert attention to securities entrusted to its care. The charges made for these services are nominal. When the owner of securities lodged with this department is also a depositor of the Bank, the charges depend upon the value of the deposit account to the Bank. When it is asked to obtain or dispose of securities for its correspondent banks, The National City Bank of New York is in an exceptionally fortunate position. The Bank's affiliate, |