Western, and 557, with a capital stock of $138,628,100, in the southern part of the country.

In point of number of active banks, Pennsylvania, New York, Massachusetts, Ohio, Illinois, and Texas lead, with 420, 328, 268, 248, 221, and 206, respectively. Arranged according to capital stock, Massachusetts is first, with $97,017,500; New York second, with $86,036,060; Pennsylvania third, with $74,753,129; followed by Ohio, with $45,770,338; Illinois, $38,746,000, and Texas, $21,863,090.

There were organized during the year reported on 28 banks, located in 15 States and the District of Columbia, with an aggregate capital stock of $3,245,000. Of this number, 8 were in Pennsylvania, 2 each in New York, Georgia, North Carolina, Ohio, and West Virginia, and 1 each in Alabama, Illinois, Kansas, Kentucky, Maine, Missouri, Texas, Virginia, Wisconsin, and District of Columbia. The number located in the Eastern States was 12, aggregating in capital stock $1,180,000; in the Western States, 6, with a combined capital stock of $875,000, and in the Southern States 10, having a total capital stock of $1,190,000. The State of Georgia is first in amount of capital stock represented by new banks, having $600,000; Pennsylvania has $520,000, and District of Columbia $500,000.

The number of banks organized was 18 per cent of the yearly average. The corporate existence of 26 national banks in 16 States, with a capital stock of $3,153,800 and a total circulation of $1,175,400, has been extended during the year. Pennsylvania has 5; New Jersey and Illinois 3 each; with 2 each in Delaware and North Carolina. Of the total capital of such banks, that in Pennsylvania aggregates $690,000; New Jersey, $272,000; Illinois, $150,000; Delaware, $140,800; North Carolina, $151,000.

Under the act of July 12, 1882, providing for the extension of national banks, the corporate existence of 1,633 banks, representing an aggregate capital stock of $403,247,115, has been extended. Of these, New York has 233, with a capital stock of $73,572,460; Massachusetts, 228, with a capital stock of $92,592,200; Pennsylvania, 204, with a capital stock of $53,776,000, followed by Ohio with 112 and an aggregate capital of $18,479,000.

One bank, having a capital stock of $100,000 and a circulation of $90,000, has ceased on account of the expiration of its charter. This bank was located in North Carolina, and was succeeded by a new association with a capital stock of $100,000 and circulation of $22,500.

During the year ending October 31, 1897, the corporate existence of 19 banks, with a capital stock aggregating $2,289,000 and circulation of $783,900, will expire. They are located in 13 States, 4 of them being in New York and 2 each in Ohio, Michigan, and Colorado. In the sacceeding ten years, from 1897 to 1906, inclusive, the corporate exist

ence of 993 banks, having a capital stock of $146,461,150 and a circulation of $39,003,872, will expire.

The number of banks leaving the system during the year through voluntary liquidation was 37, having a capital stock of $3,745,000 and circulation of $1,262,815.

It has been found necessary to appoint receivers for 27 banks during the year. Their aggregate capital stock was $3,805,000 and circulation $761,500. Of this number, 4, with a capital stock of $995,000, were among those which closed their doors in 1893 and subsequently resumed business, but through continued business depression and the character of their assets were unable to meet their obligations, and were thus compelled to go into insolvency.

A comparison of the data of this year with that set forth in the report for the year 1895 shows the number of active banks to have decreased 36, with a corresponding decrease in capital stock of $4,305,000. The number of banks organized is 15 less, and the number going into voluntary liquidation 14 less. There has been a decrease of 9 in the number of receivers appointed and 45 in the number of extensions of corporate existence granted. The loss through expiration of charters decreased 3 and the number of banks organized to succeed expiring associations remains unchanged.

The number of exisiting banks incorporated under the laws of the various States is 5,708, and the number from which reports have been received, 4,956. In addition, reports have been received from 824 private banks and bankers, or a total of 5,780 reporting banks, which is 326 less than the number from which reports were received in 1895. In response to a special inquiry addressed to the banks in operation in the United States, information was submitted as of July 1, 1896, by 5,723 banks, of which 3,458 were national banks and 2,265 were associations organized under State authority. From these reports it was ascertained that the number of depositors in banks and banking associations was 5,929,963, having to their credit $3,254,439,866. The amount of money in the banks on the same date was $413,124,849, of which gold and gold certificates amounted to $189,558,341. Upon the assumption that the amount of gold held by nonreporting banks was in the same proportion as their number to the number of those reporting, the amount of gold in all banks on that date was approximately $302,800,000. The transactions of the clearing houses of the country on July 1 amounted to $227,935, 464, and the balances $19,152,834. In the statement of these balances it is noted that the proportion of actual money used was extremely small, amounting to only about $1,350,000.

The reports from banks containing the information referred to in the foregoing paragraph exhibited also the use of credit instruments as shown by the deposits of the banks on July 1. This subject is exhaustively discussed and the conclusions drawn indicate that credit instruments in the transactions of retail trade of the country represent 67.4

per cent, wholesale trade 95.3 per cent, other mercantile transactions 95.1 per cent, and all business 92.5 per cent. The largest percentage of business represented by the use of credit instruments is shown by the deposits in the New York banks, being 96.4 per cent. The next highest percentages are 93.2, 93.3, 92.3, and 92.5 per cent for the States of Massachusetts, Maryland, Nevada, and Minnesota, respectively. lowest percentage shown is that of California, being 69.4 per cent. A considerable portion of the report is devoted to State bank failures prior to 1863, and from 1863 to 1896, inclusive.

The

Data with respect to the losses sustained by note holders and other creditors of the banks in the earlier period are meager, but are more satisfactory with respect to the losses to note holders than to other creditors of the banks. The information with respect to failures of State banks subsequent to 1863 was obtained through the instrumentality of the national bank examiners, and, while incomplete, is the most satisfactory which has ever been tabulated. The number of failures reported is 1,234; the report of capital of failed banks, $53,632,259.36; assets, $214,312,190.58; liabilities, $220,629,988.27, and dividends paid, $100,088,726.95. The returns with respect to dividends paid by these banks is unsatisfactory owing to the fact that reports show that the affairs of only 353 have been finally closed.

The Comptroller suggests the following amendments to the National Bank Act:

First. That accommodations to executive officers and employees of the banks be restricted in amount, properly secured, and only granted upon the approval of the board of directors.

Second. That no loan should be made to a director not an executive officer of the bank except either upon a deposit of collateral security or upon a note bearing the signature or signatures of one or more responsible persons, in addition to that of the director.

Third. That directors of national banks shall be required to make examination of the affairs of the bank with which they are connected on a day to be fixed by the Comptroller, a report thereof to be made to that official.

Fourth. That assistant cashiers under certain circumstances be authorized to sign circulating notes and to sign and make oath or affirmation to reports of conditions.

Fifth. That some class of public officers to be empowered to administer general oaths required to be taken by the National Bank Act. Sixth. That organization of national banks with minimum capital stock of $25,000 be authorized in towns, the population of which is less than 2,000.

Seventh. That national banks be permitted to establish branches under certain restricted conditions.

Eighth. That the semiannual tax authorized on circulating notes of national banks be reduced so as to equal one-fourth of one per cent. FI 96-III

Ninth. That national banks be authorized to receive circulation to the par value of the bonds deposited when the market value thereof is equal to the par value.

The Comptroller concludes his report by calling attention to the profit of the Government, derived from national banks, which is compared with the cost of the maintenance of the gold reserve on legal tenders issues of the Treasury.

The reports received in 1895 relative to the banking systems of the various countries of the world and of the United States, with additional information received since the last report was issued, in respect of foreign and State banking systems, are incorporated in his report.

FOREIGN COMMERCE.

The following table, prepared in the Bureau of Statistics of this Department, exhibits the principal features of the trade returns for the fiscal year 1896:

The most gratifying features of this comparison of trade in the two years are to be found in the exports of domestic produce and merchandise, and in the revenue from customs duties on imports. It was in 1880 that the value of domestic exports passed for the first time the sum of $800,000,000, and only three times was that figure attained in the ten years from 1880 to 1889. Since 1890 the value of exports has not fallen below $830,000,000, except in the single year 1895. This increase in the aggregate value of exports has occurred in spite of a general and remarkable decline in the prices of the articles exported-a decline that has with few exceptions affected the entire range of domestic product. The

conditions under which $863,200,000 were exported in 1896 are not unlike those of 1891, when the domestic exports were $872,200,000; but the excess of exports over imports in 1891 was only $27,354,087, while in 1896 it was $83,475,813. So large an excess of exports prepared the way for rates of foreign exchange more favorable to this country, and contributed largely to the recent heavy movement of gold from Europe to the United States in settlement of the trade balances. While the export of gold during the fiscal year 1896 was greatly in excess of the import, the import in 1897 promises to more than turn the scale in favor of this country.

In 1860 the value of domestic manufactures exported was $40,345,892, constituting about one-eighth of the total exports of domestic merchan

In 1876 the value of this class of exports reached $100,000,000, and in the following year attained $133,933,549. From that year until 1890 there was little change in this value. From 1890 to 1893 there was a growth of about $20,000,000, and from 1893 to 1896 nearly $70,000,000 have been added—a remarkable increase, and making the manufactures more than 26 per cent of the entire domestic export. The details of this movement will be found in the tables printed by the Bureau of Statistics of this Department in the annual report on "Commerce and Navigation of the United States."

The average ad valorem rate of duties, under the tariff law of 1890, was about 50 per cent. The ad valorem rate in 1896 was 39.94 per cent, producing a revenue of $156,104,599 from imported goods. Imported sugar yielded $39,808,140.

REORGANIZATION OF CUSTOMS DISTRICTS.

The expense of unnecessary customs ports has been commented upon heretofore, and I again invite the attention of Congress to the subject. An examination of the table showing the receipts and expenditures of the Customs Service during the past fiscal year, which is appended to this report, will show that in numerous districts there is little or no business requiring the continuance of customs establishments. Ports are created by legislative enactment, and there would seem to be a necessity for such reorganization as will insure a more economical administration in the collection of the revenue from customs. It is probable that the appointment of a commission to take into consideration the needs of the Service and to prepare a plan of reorganization would prove beneficial. Deputy collectors of customs clothed with power to enter and clear vessels could be stationed at places where their services are required, and the present outlay for salaries of collectors and other officers saved, and the necessity for large deficiency appropriations obviated.

*See Table No. 1, Report of the Supervising Special Agent, in the Appendix, page 802.