Recent Bank Research Articles

Recent and Prospective State Banking Legislation

Much new legislation probable in 1909, 233. — Legislation during 1907, 234. — Legislation during 1908: as to savings banks in New York, Massachusetts, Ohio, Rhode Island, 235. — As to trust companies and state banks; in Ohio and Rhode Island, 243; in Massachusetts, as to reserves, 243; in New York, as to reserves of banks (244), duties of directors (248), authority of supervisor (249).

The Recent Australian Bank Failures

When I had the honour of being asked to occupy this chair, I had little difficulty in choosing a subject upon which to address you at the opening meeting of the Session. For I at once determined to bring before you something of a practical nature, connected with the business in which most of us are engaged, and there was one subject in particular which had lately been occupying my own mind and the minds of many others who have to do with the investment of money. The stoppage of thirteen Banks within a period of six weeks, suspending liabilities for deposited money amounting to many millions sterling, and creating a financial situation in the Australian Colonies unparalleled perhaps in the whole history of modern times, is an occurrence which may well engage our attention if we are able to gather from it any of the lessons which must surely be involved in an event of such remarkable significance.Let me say at the outset that I cannot pretend to offer to you any picture of the situation as that must have presented itself to those in the midst of it. Nor is it my purpose to attempt to bring before you the inner and more intimate causes which contributed to the catastrophe. I could no doubt quote a good deal that has been written and said on the subject of Australian banking and finance generally, pointing out the artificial prosperity created by an undue importation of borrowed money—the inflation of land-values that led up to the ‘boom’ in Melbourne and its natural issue in collapse—the consequent failure of Companies that practically had been formed to assist or engage in land speculation—the reaction upon the Banks of these things and of the resulting financial depression—and the culmination of these and other causes in the loss of public confidence that brought about the disasters of the present year.