There is absolutely no more duplication of work in any branch of the business of the two bureaus than there is between the divisions of the respective offices. The work of each bureau is wholly separate and distinct from the other and no good reason exists, from the standpoint of efficiency, expedition or economy, for the consolidation of the two bureaus.

The Federal Reserve Banks from the very beginning of their existence have strongly favored and persistently urged the absorption of the Comptroller's functions by the Federal Reserve Board and the abolition of the office of Comptroller of the Currency. These banks have been principally instrumental and active in keeping alive the agitation of this question and are apparently influenced wholly by a desire or ambition to enlarge their own authority or powers by having the national banks in their respective Federal Reserve districts placed under their exclusive supervision and control. They contend that the national banks have now increased in number to such an extent as to render effective and satisfactory supervision by a centralized authority at Washington practically and physically impossible, and, therefore, they recommend and urge that this supervisory authority be divided among the twelve Federal Reserve Banks, each to have supervision and control of the member banks comprising its Federal Reserve district. In other words, instead of having, as now, a Comptroller of the Currency at Washington performing his duties under the general direction of the Secretary of the Treasury, and a uniform interpretation of the national banking laws and regulations for the guidance of all banks and bank examiners alike, it is proposed to decentralize this authority, when the tendency of the age is toward centralization, and scatter it to the four winds of the country by creating twelve little Comptroller's offices and placing the banks in their respective territories under their exclusive supervision and control.

Under such a system it must be conceded that confusion cannot but be the ultimate result of having as many interpreters of the statutes governing banking and as many conflicting rules and regulations for the guidance of the banks and bank examiners as there were units in the division of the banks. That which would be held lawful in one reserve district would be ruled to be unlawful in another district. Under the present system of supervision there is absolute uniformity in the interpretation of the banking laws and the rulings and regulations of the Comptroller of the Currency. When the position of a bank or a bank examiner is ascertained to be in conflict with that of the Comptroller's office it is promptly corrected by correspondence.

It is confidently believed, and this belief is based upon the light of years of experience, that a division such as is proposed in the supervisory control of the banks would prove to be impracticable and unsatisfactory. Enforced observance of the law in some districts would likely prove too severe and arbitrary, and in others inexcusably lenient and faulty, unduly lenient or arbitrarily severe according to the temperament or disposition of the governing control, influenced by favoritism or actuated by selfish interests or prejudices. Many banks in the West and in the South have already experienced some of the objectionable and selfish motives which have actuated or influenced the Federal Reserve Banks in those sections of the country in their dealings with member banks when their own interests were concerned.

There is no advantage whatever to be gained by the country banks from such a change as is proposed and advocated by the Federal Reserve Banks, and no improvement in the supervisory system will result from such a change. The Federal Reserve Banks are now furnished with a copy of the report of every examination made of the banks in their respective districts by the national bank examiners immediately upon completion of the report in each case, so that they have at all times as full and complete knowledge of the condition of the banks, as shown by such reports, as the Comptroller of the Currency has. The reports are made in duplicate, one copy for the Comptroller of the Currency, and the other for the Federal Reserve Bank. There is no duplication of examinations, therefore, and no necessity for any, as the copies of the reports furnished the Federal Reserve Banks by the national bank examiners contain all the information they could possibly obtain in regard to the condition of the banks, and probably more, if their own examiners were to make the examinations.

State banks and trust companies that are members of the Federal Reserve System are, as a rule, examined by the State Bank examiners, who furnish the Federal Reserve Banks with a copy of their reports which are accepted by the Federal Reserve Banks, unless the condition shown by the reports is not satisfactory, in which case they have an examination made by their own examiners, who report direct to the Federal Reserve Bank instead of to the Federal Reserve Board, as national bank examiners do to the Comptroller of the Currency. This practice the Federal Reserve Banks are exceedingly anxious to have extended to national bank examiners so that reports of their examinations of all national banks shall be made direct to them instead of to the

Comptroller of the Currency, and that these examiners shall be directly under their supervision and control.

It is believed that it would be a serious mistake to transfer the supervision and control of the national banks and national bank examiners to the Federal Reserve Banks even though the Federal Reserve Board and the Comptroller's office should be consolidated at some time in the future.

Some of the reasons why this should not be done will be more clearly understood by a study of the banking and business situation in Iowa during the period commencing about the year 1918, and the principal factors responsible for these conditions.