The conditions disclosed by the bank failures above mentioned and others that occurred during the year 1891, led Mr. Lacey to express the opinion in his report for that year that some limitation should be placed upon the amount of commercial or business paper that may be discounted by a national bank for any one person, company, corporation or firm, and that a similar restriction should be placed upon indirect liabilities of guarantors or endorsers. If, he stated, it was deemed necessary to limit direct loans to a percentage of the capital of a bank, for the same reason indirect liabilities should be subject to some restriction.

Further comments will be made upon this subject in connection with the recommendations submitted to the National Monetary Commission in December, 1908, for amendments to the national banking laws.