Jones & Jones

Hoarders of available credit are little better than hoarders of currency.

Ever since he thus addressed the American Bankers Association last summer, RFC Chairman Jesse Jones has been hammering away at the idea that commercial banks must loosen up on industrial credit to finance recovery. By way of example this big breezy Texan scattered hundreds of millions of dollars in Federal loans up and down the country. If commercial bankers refused to follow his pace, he threatened again & again to put the RFC directly into the commercial banking field and take away the business of private sluggards.

Last week the American Banker made it appear that Mr. Jones, in his private capacity as board chairman, president and principal owner of Houston's National Bank of Commerce, was something of a sluggard himself. When the Jones bank had published its March 5 condition statement in response to the Government's call, the mouthpiece of bedeviled bankers dug up the two previous statements to see how well National Bank of Commerce had followed the precepts of its boss in Washington in the matter of industrial credit.

In eight months deposits at the Jones bank jumped from $18,390,000 to $23,623,000, and through sale of preferred stock to the RFC capital had increased from $1,000,000 to $3,500,000. But the American Banker discovered that instead of lending more freely in the best Jones manner, the Jones bank had substantially increased its cash and Government bond holdings until it was more than 80% liquid. Loans & discounts had actually decreased. The Jones bank was rock-sound but apparently it had found good borrowers as scarce as any non-Jones bank in the land.

Mr. Jones's explanation: "I haven't anything to do with running the bank. I have been hammering at it as well as others to extend loans to business."

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