BANKING: Prudent Move

One of the most brilliant of all U.S. dividend records was tarnished last week when Manhattan's First National Bank cut its fourth-quarter payment from $25 to $20, thus placed the shares on an $80 annual basis, lowest since 1924. The stock promptly nose-dived 80 points to $1,230 per share.

Lower profits were not the reason First National cut its dividend. Earnings this year, in fact, will approximate the $10,241,000 cleared last year. But First National—now weathering its fourth U.S. war—was worried by increasing controls and taxes, figured smaller dividends would be a "prudent move."

First National is a banker's bank. Handling...