Complete Confidence

One shocked stockholder of a Manhattan bank, after listening to the report made to him by the chairman of his board, got to his feet in annual meeting last week and demanded to know what could have impelled a bank to take its stockholders so completely into its confidence. The bank was the 134-year-old Bank of the Manhattan Co. The chairman of its board, John Stewart Baker, great grandson of one of the bank's founders, suavely answered: "The spirit of the times."

J. Stewart Baker, who like his father Stephen became president of the bank at the early age of 34, has kept his venerable institution abreast of the times. In the boom days of 1929 the Bank of the Manhattan Co. surrounded itself with affiliates (International Acceptance Bank, New York Title & Mortgage Co., International Manhattan Co. etc.) and started acquisition of a group of banks (County Trust Co. of White Plains, the Corning Trust). Two years ago it turned with the tide, made International Manhattan Co. give up dealing in securities. A year ago it divorced New York Title & Mortgage.

The modernistic bank report with which J. Stewart Baker last week startled his stockholders gave the following information:

1) The bank's directors had met weekly. Three of them had made a special audit of the bank's affairs and their report was on the table for any stockholder to look at.

2) Items which made up "other securities," "loans and discounts" and "real estate" in the bank's last statement were explained in detail.

3) A full account was given of how the bank's German credits of $70,000,000 had been reduced to $19,500,000 in three years at a loss of $4,500,000.

4) The bank had profits of $5,102,000 last year, of $4,950,000 this year.

5) A total of $4,860,000 in salaries was accounted for. The two highest-paid officers got between $50,000 and $60,000 each. No regular bonuses have been distributed since 1929. Last year bonuses totaled $10,000. To 36 retired employes went $94,000 in pensions.

6) In force for the last two years have been rules that officers may not borrow from brokers, may not indorse other loans, must report all loans not adequately collateralized, must report all loans in excess of half a year's salary.

7) Since 1931 the bank has not engaged directly or indirectly in the distribution of any securities.

8) The bank officers view with alarm deposit guarantee and inflation.

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