Clearing Houses we have said may be divided into two classes as to functions exercised, or to be more exact, they are divided as to the number of functions. All Clearing Houses make use of the clearing facility and most of them, whether by rule or custom, make some provision for their mutual protection. For example : during the panic of 1907 many Clearing Houses which had no set rule looking to the relief of members, appointed a committee who met daily to discuss ways and means. In addition to this class of Clearing House there is another distinction consisting of those associations which go further, and not only organize for economy and strength, but also for profit and progress. Some of the most common practices of this latter class are regulation of exchange charges, interest rates, advertising restrictions and many other matters which are more strictly local in importance. Bankers, as a rule, are very reluctant to submit to any restrictions which prevent independence of action and, therefore, this class of Clearing House is in the decided minority. This is unfortunate, for under wise administration more real progress and general good can be accomplished through concerted action, than by policies adopted individually for selfish ends. Competition is essential in most industries, but in banking this is true only to a limited extent. Banks deal in a commodity which is subject to hard and fast rules set forth in the National Bank Act and legislative statutes. In many matters no bank can be a law unto itself without being a menace to the entire community and in the end bringing destruction upon itself and serious loss upon its neighbors. This fact has been shown too often to admit of serious contention. Therefore many Clearing Houses have a regular exchange of credit information, rules governing advertising, regulations fixing scales of exchange rates and many other similar measures which promote a healthy condition of financial stability and work for the welfare of banker and merchant alike. Of course, there have been and are records of Clearing House combines which exceed the proper limits of coercion and have sought to profit at the expense of a neighboring city, or have made regulations which do not conform to a proper spirit of general welfare, but such instances are of rare occurrence. The framing of rules which are binding upon banks who are members of Clearing Houses is not to be construed as being in restraint of trade, but rather as conforming to the axiom that what is best for the many is best for the few.

Indorsement Stamps Such As Are Used BY

Banks And By Most Large Business

Houses. Observe The Use Of The

Universal Numerical System

Pay To The Order Of Any Bank, Banker Or Trust Company.

All Prior Indorsements Guaranteed. May 8, 1922.

First National Bank, Statetown. 59-16 Warren Day, Cashier. 59-16

Pay To The Order OF

The First National Bank

Brown Printing CO.

Pay To The Order Of 1-5 American Bankers Bank. 1-5

Jan. 17, 1922.

First National Bank

Statetown. 59-16 59-16

Warren Day, Cashier