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There is plenty of theoretical argument against branchbanking. There is also much sentiment against it, for oldtime U. S. banking tradition is one of local "unit" independence (the local small-town banker a fatherly financial shepherd to his local flock). Also, for practical purposes, potent bankers have found it prudent to disclaim any intention of becoming more potent lest such designs should offend small bankers who, meanwhile, must be their principal customers. Therefore, the merging-grouping trend had to move until it had half-swept the nation before the A. B. A. dared approve it. And even last week the trend was only partially approved. Branchbanking was endorsed for extremely limited areas only ("metropolitan" and "county"). Nothing was said about state-wide much less nation-spanning chains of banks.
The Convention—A. B. A.'s 56th—met in Cleveland for the first time since 1899. And for the first time in history it was addressed by a President of the U. S. (see p. 14).
First indication that the Convention was sure to take a favorable stand on branchbanking came with the report of Rudolf S. Hecht, a first citizen of New Orleans, famed as President of HiberniaBank & Trust Co. and nationally famed as chair-man of A. B. A.'s economic policy committee. In Banker Hecht's stand there was an element of irony. Long has he been a stout defender of unit banking. In making his report he said: "I want to make it clear that at heart I still hold the same views concerning our unit banking system. . . . I am as much as ever opposed to the creation of a banking monopoly in the hands of a limited few. ... I still also hold that public welfare demands the maintenance and strengthening of our independent unit banking system wherever its services are economically justifiable. However, the march of events in the last few years seems to draw us irresistibly toward some modification of our banking structure. . . . We cannot stem the tide of economic events by passing hostile resolutions or by mere appeals for still more legislation. . . ." And there was irony too in the fact that head of the resolutions committee was Max B. Nahm of Bowling Green, Ky., who last year was an eloquent orator against branchbanking.
Convention points were:
Savings Banks. "Commercial banks are creeping into the field formerly occupied by savings banks"—Howard Whipple, vice-president, Bank of America of California.
"Likely changes will come into the Federal Reserve System from time to time. . . . I refer to a possible amendment under which mutual savings banks could become members"—Rome Charles Stephenson, new A. B. A. president.
"If the word 'savings' is used in describing the type of deposit solicited, the responsibility of trusteeship cannot be escaped"—Austin McLanahan, president, Savings Bank of Baltimore.
"Economic history is relentless in teaching that the popular vice which needs correction is excessive spending, not excessive savings"—Alexander Dana Noyes, financial editor, New York Times.
Personal Loans. "Character—the best collateral on earth"—Robert B. Umberger, vice-president, Personal Loan & Savings Bank, Chicago.
Trusts. "It has been said that about $30,000,000,000 of estates are now being administered by banks and trust companies, and that 1,086