The regular meetings of Boards of Directors in most banks are held twice a week, but in some banks meetings are held daily. The mode of discounting paper varies much in different banking institutions. In many of them, especially in the larger cities, the business head, whether he be the president, vice-president or cashier passes on the paper as soon as it is offered for discount. Customers cannot wait, money is wanted, and they are speedily told whether they can be accommodated or not. But with the country-banks a different custom prevails. The paper is offered for discount and is put before the directors, and they decide whether to accept or to decline it. The president of a very profitable bank in New York City once said to the writer, that after his bank had been in existence for ten years it had lost only three pieces of paper, and these were discounted by the board during his absence. He loaned the money, and the directors at their meetings merely ratified the loans made. A board is a very convenient body for referring paper which an officer is unwilling to accept. He does not wish to offend the offerer by declining to discount it, and so it is referred to the board for their action. This is the least offensive way of telling a man that he cannot be accommodated. Of course, many cases are referred to the board for their action which may be decided favorably. The amounts may be very large, or there may be something peculiar about the loans, a longer time than is usually granted perhaps may be wanted, and the cashier or president may not wish to assume the sole responsibility. When banks hold daily meetings the directors decide what paper shall be discounted.

In order to have a correct knowledge of dealers' accounts, the cashier has on his desk a book which contains a record of the average daily balance of every dealer. This is made up at the end of each month, and the average for the month is entered in the Average Book. At the end of the year the average for the twelve months is struck, and usually the Average Book is so ruled as to show the daily average for five to ten years previously. The Average Book is indexed throughout on the margin, with as many leaves as are required for each letter. The names of National banks are usually entered first, alphabetically, then State banks, then bankers, and then the individual depositors from A to Z. Usually there is a new Average Book for each year.

The amount of discounts usually granted to a dealer (the bank's safety, of course, first being assured) is proportionate with his average balances. For example, a dealer whose general average balance is $15,000 would be entitled to accommodation, other things beings the same, to five times as large a line as a dealer with an average balance of $3,000. Hence a correctly kept Average Book is an important guide in granting discounts.

Good banking requires a bank to be in a condition to meet every dealer's reasonable needs in proportion to his balances, irrespective of the current condition of the money market.

At Directors' meetings the president is seated at the head of the table, and the cashier occupies a convenient seat near him. In some banks the directors have particular chairs, in others no order of arrangement is observed. The cashier reads the minutes of the previous meeting of the board, and after their approval the board proceeds to other business. The cashier records the names of the directors present, as this fact is worth preserving. The business transacted since the last meeting, as previously stated, consisting of the discounting of paper on the responsibility of the bank manager, is submitted for ratification. Banking institutions are not always so particular as they ought to be in doing this, or in examining the paper taken.

When the wrong practices of Eno, the president of the Second National Bank of New York, were discovered, it was found that not only did he discount paper on his sole responsibility, but kept it in a vault down town, not belonging to the bank, and the directors never saw it. They accepted his statement of what he did as true, and never troubled themselves to look at the paper discounted. Had this been done, Eno would have been obliged to resort to some other artifice to conceal his fraud; or, what is quite probable, could not have gone so far as he did, without exciting suspicion leading to his detection.

Vigilance is the price of prosperity, and this applies more emphatically to banking than to almost any other kind of business.

Daily Statement, 188

Bills discounted..........................

Temporary loans.............................

U. S. bonds with Treasurer to secure circulation.

Other Stocks and Bonds and Mortgages. N. Y. Clearing-house Association bonds Sundry securities......................

Total loans.

Legal-tender notes.....................

Specie—Gold certificates...............

Clearing-house certificates

coin.....................

Silver coin ....................

Arctic National bank notes.............

Notes of other National banks........

Exchanges for Clearing-house..........

Total cash.

Expenses. . Interest.... Premiums . Taxes paid Exchange..

Total expenses, &c.

Real estate, banking house...................

Other Real Estate............................

Deposit with U. S. Treasurer, 5 per cent. fund. Due from U. S. Treasurer, Redemption Agent. Due from banks............................

Total footings.

Memoranda—Legal-tender notes..............

Specie....................*......

5 per cent, fund and redemptions,

Total reserve

Reserve required.

Monday.

Tuesday.

 
   
   
   
   
   
   
   
   
   
   

Wed.