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# NOTHING HAS OCCURRED # TO JUSTIFY DISTRUST Himself a National Banker, Has Only Words of Commendation for Oklahoma Law Kansas City, Nov. 5. Senator R. L. Owen, of Oklahoma, who is stopping nere, stoutly defends the bank guar- anty law of Oklahoma, The senator, in an interview said: "In my judgment, nothing has oc- curred to justify distrust in the princi- pies laid down by the guaranty law of Okiahoma. "It is true that the Coumbia Trust company failed, but it is also true that bad management or harmful talk about a bank may put any institution in ligaidation. "I do not pretend to know the cir- cumstances of the fallure of this stare institution, but I cannot help remark- ing that the American National bank ot Bartlesville, which was a national bank controlled by Mr. Norton and nis friends also went into liquidation, because of the same underlying caus- es. "Shall we denounce the National bank act, because Mr. Norton's bank at Bartiesville, the American Nationai went into liquidation? Believes In System "Not at all. The National banking system is one of the finest on eart.... and I have been in the National bank- ing business for twenty years and all my interests now are in the National banks and are not in state banks. Nevertheless, 1 am firmly convinced that the guaranty fund plan is not anly judicious for the state banks, but should be adopted for the National banks. "The National banks are extremely cafe as it is, taking them as a class, although you occasionally see a fail- ure, due to bad management or to avoidance of the safe-guards establish- ed by long practice and by statute. No Reckless Banking "Those who clamor against the guar- anty fund law, which gives a specia protection to an ignorant depositor, generally do so on the ground that it promotes reckless banking. "Nothing of the kind is true. It does not promote reckless banking. It pro motes conservative banking. The Oklahoma law is conservative in this that it forbids bankers pay ing over four per cent on time deposits over three per cent on short time de posits; forbids bankers taking ove en per cent for money; forbids the of leers of a bank, borrowing from the bank; requires a substantial reserve to be kept on hand, and has other safe-guards, established by law includ- ng a double liability of the stocknold- ers. Jeopardy Not Likely "Why should a state banker, who puts up $100,000 of his own money and under the double liability is in- debted to the depositors $100,000 more, conduct a reckless business, and jeu- pardize the house in which he lives? "The guaranty fund is limited lia bility and is not an unlimited liability. "It is a very important considera- Lion, because it meets the wholesale bjection, that the conservative man ought not to be entirely responsible for the losses of the unwise man or of the reckless man. The answer to this proposition is he is only re sponsible to a very small amount, Conflict Bad Policy "I think it very bad policy for a state to have any hostilities aroused between the National bankers and the state bankers, although sometimes, a conflict of interest seems to be un avoidable, where the bank has he guaranty plan an de National bank has not. "The ignorant, unsuspecting depos -tor ought to have this safe guard, so as to prevent his having any excite ment in times of financial stringency. It is the runs on banks, in times of panic, by ignorant depositors who are frightened, that cause the most ter rible financial disasters. "The fear of the depositor shonin be prevented by a reasonable guar- anty fund that will assure him his money. In case of bad management. To prevent panic, is very important, not only to the depositor, but to the stockholders of the banks, winehter state or National, is very important to the bankers themselves and is o -equal importance to the entire com mercial world which suffers if busi -ness is paralyzed, wnen financial pan- -ic occurs. Improvement Suggested "I think the Oklahoma law would be improved by allowing the contri- buting banks to eléct the state bank commissioner and the state, bank in spectors, and give them the right to recall, in case of inefficiency of these officiale this would avoid the sus teion of political manipulation and confidence would be established in the minds of the people. "I have entire confidence in the quaranty fund plan. It will moteer the little depositor by the mutual surance plan and will prove very bene ficial to the state of Oklahoma, as it
