Democratic Sentinel, Volume 4, Number 43, Rensselaer, Jasper County, 3 December 1880 — REPORT OF THE COMPTROLLER OF THE CURRENCY. [ARTICLE]

REPORT OF THE COMPTROLLER OF THE CURRENCY.

The following is a portion of the annual report of the Comptroller of the Currency. The amount of national-bank and legal-tender notes outstanding ou NoV. 1, 1880, and tho aggregate amounts of both kinds of notes for the same date in 1878 and 1879, was as follows : Amount of Amount of national legal ten- Aggregate, tlons. b’k notes, der notes. Ones $ 2,292,462 $ 21,954,900 $ 24,247,862 Twos 2,207,260 21,829,318 23,030,578 Fives 99,910,700 67,132,138 167.042,898 Tens 113,820,580 75,835,008 189,655,588 Twenties 75.631,560 72,088,277 147,719,887 Fifties 21,418,300 24,359,175 45,777,475 One hundreds. 26,888,900 33,069,700 59,958,600 Five hundreds. 639,500 16,126,000 16,765,500 One thousands. 239,000 14,401,600 14^640.500 Five thousands 565,000 665,000 Ten thousands 320,000 320,000 Add for fraction of notes not presented or destroyed.... 15,129 15.129 Totals $342,063,451 $347,681,016 $689,744,467 Deduct for legal tinder notes destroyed in Chicago fire 1,000,000 1,000,006 Totals $342,063,451 $346,681,016 $688,744,467

The aggregate amount of both kinds of notes in 1879 was $681,815,520 and in 1878 $666,333,137. The law provides that after specie payments are resumed national banks shall not be furnished with notes of loss do domination than $5, and in accordance with this provision no notes of the denominations of $1 and $2 have been issued since the Ist of January, 1879. The amount ot ones outstanding that day was $4,793,817, and of twos $3,924,930 ; total, $7,718,748. Since that date ones have been reduced $2,501,355 and twos $1,717,670, making the total reduction of small bank notes $4,219,025. The amount of legaltender notes of tho denomination of $1 outstanding at that date was $20,257,109, and of twos $20,035,525 ; total, $40,202,634, and the increase since that date to Nov. 1, 1880, has been $3,404,584. Thus it will be seen that while small notes of national banks have been reduced more than $4,000,000 ($4,219,025) in compliance with the law since the date of resumption, the legal-tender notes of the same denomination have been increased $3,491,584. The total amount of theHe denominations of both kinds ontstanding Nov. 1, 1880, is $47,233,940; total increase during the year, $3,805,575. The decrease during the year previous was $3,649,451. Of the entire amount of national-bank and legal-tender notes now outstanding nearly 7 per cent, consists of $1 and $2 notes, more than 31 per cent, of sl, $2, and $5 notes, and moro than 58 per cent, is in notes of less denomination than S2O, and 80 per cent, is in notes of lower denomination than SSO. Of entire issue about 20 per cent, is in denominations of SSO and upward. Tho amount of circulation of tho Bank of France Jan. 30, 1879, was $458,194,166, showing an increase between that time and Jan. 29 of $6,100,707. Tho Imperial Bank of Germany issues no notes of loss denomination than $7.50, and the Bank of Franco issues but about $2,000,000 in notes of less denomination than f;5. The Bank of England issues no notes less than $25. and the Banks of Ireland and Scotland none less than $5. The amount of circulation in this country in denominations of $5 and under was $214,326,838 on Nov. 1, 1880. In the foreign countries named a large amount of silver and gold coin of lower denominations enters into general circulation. It will be impossible to keep in circulation any large amount of small gold coins or silver dollars unless’coinage of the latter is restricted and small notes withdrawn. The total amount of United States bonds held as security for circulating notes on the Ist of November, 1810, was $359,748,959. On Oct. I,' 1865, the total amount of bonds held for this purpose was $276,250,550, of which $199,397,950 was in 6 per cents, and $76,852,600 in 5 per cents. On Oct. 1, 1870, banks held $246,891,300 of 6 per cents, and $95,942,550 of 5 per cents. Since that time there has been, to Nov. 1, 1879, a decrease of $185,211,560 in 6-per-cent. bonds, and an increase of $51,137,200 in 5 per cents. Banks now hold $36,988,950 of per cents., which have been deposited since Sept. 1, 1876, and $119,075,100 of 4 per cents., which have been deposited since July 1, 1877. During the year $19,243,300 of 4 percents, have been withdrawn, chiefly for tho purpose of realizing large premiums on these bonds, and $22,370,750 of 6 per cents, deposited, which will mature in a few months. The banks still hold SB,OOO of 6-per-cent. 5-20 bonds and $526,900 6-per-cent. 10-40 bonds, upon which iuterest has ceased. They also hold $146,552,850 of s’s of 1881, which are redeemable the Ist of next May, $2,010,000 6’s of 1881, payable the Ist of January next, and $50,432,150 6’s of 1881, which are redeemable the Ist of July next.

The large numbei of 4-per-cent, bonds recently withdrawn from the treasury by the national banks shows that the banks aro taking advantage of the present high rate of premium commanded by those bonds to realize a profit equal to- three years’ accrued interest. On July 1 there was on deposit in the treasury to secure circulation of national-bank notes and Government deposits about $134,000,000 of 4-per-cent, bonds, and about $143,000,000 of 6-per-cent, bonds. The amount of 4-per-cent, bonds now on deposit is about $118,000,000, and of 5-per-cent. bonds over $159,000,000, thus showing a decrease in 4 per cents, of about $16,000,000, and an increase m 5 per cents, of about a like amount. In substituting the 5 for the 4-per-ceut. bonds the banks realize the premium on the latter, and can replace them with 6 per cents, at about par. The substitution has taken place for the most part during the past six weeks, and at presnt the 4 per cents, are being withdrawn atethe rate of about $700,000 per day.

All of the 5 and 6-petr-cent. bonds now held by national banks, with the exception of Pacific railway bond#, wifi mature on or before July J, 1881, and will probably be replaced by bonds bearing interest at 4 or 4>£ per cent., only new bonds, hereafter to be issued by authority of Congress, bearing a less rate of interest. The amount of bonds held by national banks Nov. 1, 1880, was $403,369,350, and the amount held by other banks and bankers of the country in the above table is $228,053,104. Tho total amount held by all banks and bankers is shown, approximately, to be more than oneIhird of the whole interest-bearing funded debt of the United States, as follows : State banks and trust companies $ 24,198,604 Sa\ ings banks 189,187,816 Private bankers 14,3GG,684 National banks 403,309,350 Total. $631,422,454 ' The increase in net deposits of national banks during, the year was $187,385,075. of savings banks $34,508,295, of private bankers $42,749,004 and of State banks and trust companies $61,714,761, making a total increase in bank deposits of the country of $326,356,815. The total number of national banks, State banks, savincs banks, private bankers, etc., in the country June 11,1880, was 6,532, with total banking capital of $650,049,390, and total deposits $2,219,883,290.

The total estimated amount of coin and bullion in the country Nov. 1 was $612,283,357, of which $454,012,030 was gold and $158,271,327 silver. Tho amount of gold and silver, and per cent of each held by the United States treasury Nov. 1, 1830, was'as follows : Standard dollars % 47,084,459 Other coin and bullion 30,672,867 Total silver 77,757,316 Gold coin and bullion 140,725,953 Total coin and bullion 218,483,269 Per cent, ot silver 35.6 Per cent, of gold 64.4 The amount of bullion in the Bank of England in October, 1880, was $141,632,00), and in the Bank of France Oct. 29, 1880, was $116,140,000. The percentage of gold held was 31.7, and of silver 68.3. Statistics show a rapid reduction during the last two years in the amount of outstanding circulation of banks which have ceased to do business, and indicate that the final loss upon notes of national banks will not exceed 1 or per cent. The Comptroller recommends that the law now in force be so amended that the nationalbank circulation shall be redeemed upon a percentage of notes outstanding ; that the banks in operation shall pay their proportion of expense, and the remainder to be borne by the Government, which alone receives the benefit, and should, therefore, pay its just shares. The Government has for the past fifteen years annually received an average of mo; a than $3,000,000 of taxes npon deposits, upon a system unknown elsewhere in any country, and it is certainly but just that it should bear the expenses of redemption of those notes from circuLitipß, of which it receives the entire benefit.

The total amount of national-bank notes received for redemption by the Comptroller of the Currency and at the'redemption agmeies of the treasury during the year 1880 is shown to have been’ $6 \098,940. The number of bank notes which have been issued since organization of the system is 137.877,219, vamed at $989,068,985. Of these 98,936,566. valued at $641,005 534, have been redeemed, and 38.740,653, valued at $342,063,451, were still outstanding on Nov. 1, 1880. The amount of national-bank currency destroyed during the year ending Oct. 31, 1880, was $35,539,600. The Comptroller says: Tho total losses charged" off bv banks during the v, ar were $14,706,406, arid for tho four years previous 285,845,069. Tho total losses charged off during the last five years are more than 25 ix>r cent, of tho entire capital of the banks. During the last five years the average number of banks annually passing dividends on account of losses liaVo been 279. The average amount of capital upon which no dividend has been paid during that time is $42,266,244, from which it follows that, for a continuous period of five years, about one-seventli of tho whole number of banks in operation have paid no dividends, and that nearly one-tenth of the total capital has been unremunerative. The Comptroller deals at considerable length with tho subject of national-bank taxation. He admits the light of the Btntos to tax tho shares of banks organized under State laws, but holds that they have no right to imposo a higher tax on national-bank sliares than on any other money capital in tho hands of individuals. He recommends Congress to pass a law fixing the maximum rate of taxation which tho State can impose on theso shares. The Comptroller repeats nis previous recommendation that the national law imposing a tax on the capital and deposits of tho banks and providing for the use of the 2-cent check stamp be repealed. He says that the tax on spirits, tobacco, and beer, together with tho customs revenue, would be quite sufficient to meet all the expenses of the Government, and to reduce tho public debt at the rate of hundreds of millions of dollars every year. The abolition of tho match tax and the tax on patont medicines is also recommended.