The Commoner.
April 18, 190a
any .time after the expiration of two
years from the date of the assump
tion aforesaid; and it shall pay into
the treasury of the United States, on
the first days of January and July of
each year, a tax of five-eights of one
per centum upon the average amount
of such notes in actual circulation dur
ing the preceding six months.
Fourth. To take out for issue an
amount of hank notes equal to ten
per centum of its paid-up capital at
any time after the expiration of thrfce
years from the date of the assumption
aforesaid; and it shall pay into the
treasury of the United States, on the
first days of January and July of each
year, five-eights of one per centum
upon the average amount of such notes
in actual circulation during the pro
ceding six months.
Fifth. To take out for issue an
amount of bank notes equal to ton
per centum of its paid-up capital at
any time after the expiration of four
years from the date of the assump
tion aforesaid; and it shall pay into
the treasury of the United States on
first days of January and July of each
year, a tax of five-eighths of one per
centum upon the average amount of
such notes in actual circulation dur
ing the preceding six months.
Sixth. To take out for issue an
amount of bank notes equal to ten
per centum of Its paid-up capital at
any time after .the expiration of fiv1
years from the date of the assump
tion aforesaid; and it shall pay into
the treasury of the United States, on
the first days of January and July of
each year, a tax of five-eighths of one
per centum upon the average amount
of such notes in actual circulation
during tthe preceding six months.
Seventh. With the approval of the
board of control, to take out for issue
ah amount of notes equal to twenty
per centum of its paid-up capital at
any time after the .expiration . of six
gears' - from' the date of the assump
tion aforesaid; but it . shall' .pay into
the treasury "of the United States, on
the first days of January and July of
each year, a tax of one and one-half
per centum upon the average amount
of such notes in actual circulation dur
ing the preceding six months.
Eighth. With the approval of the
.board of control, to take out for 13
sue an amount of notes equal to
'twenty per centum of its. paid-up cap
ital at any time after .the expiration
of seven years from the dates of the
assumption aforesaid; but it shall pay
into the treasury of the United States,
on the first days of January and July
of each year, a tax of two and one
half per centum upon the average
amount of such notes in. actual circu
lation during the preceding six
months.
The manner and form of the as
sumption of the current redemption of
the United States notes, as aforesaid,
shall be as follows: Bach note shall
bear the indorsement:
"For value received, the na
tional bank of (city), (state), will
currently redeem this note in gold
coin until the same has been paid and
cancelled in accordance with the pro
visions of law.
Any notes so indorsed shall be a le
gal tender for all debts, public and
private, except duties on imports an I
intere&t on the public debt, as here
tofore, and upon presentation and de
mand be, redeemed, as now, out of the
issue and redemption division, and
the bank which has assumed to cur
rently redeem the same shall, immed
iately upon the demand of the secre
tary of the treasury, transmit to the
treasury an amount of gold coin equal
thereto, and when received shall be
paid into the issue and redemption II
vision, and the notes shall then be re
turned to said tank,
.. Whenever a national bank shall pre-j
sent any United States notes at .the
United States treasury , for indorse
x ment, as-aforesaid-, 4t8lrallattheame
tinie 'surrender to 'the Uriited 'States
treasury an additional amount of
United States notes equal to one-half
of the United States notes presented
for such indorsement and receive in
exchange therefor gold coin; and the
United States notes so redeemed shall
be canceled and destroyed.
Sec. 3. That when the national
banks of the United States shall have
assummed the current redemption of
United States notes amounting in tho
aggregate to one hundred and thirty
million dollars, and the United States
has redeemed and cancelled United
States notes amounting' to sixty-five
million dollars, no national bank shall
thereafter pay out any United States
notes the current redemption of which
has not been assumed by some national
bank, but shall return the same to the
United-States treasury for redemption,
and the secretary of the treasury shall
redeem the United States notes so re
turned out of the gold coin in the is
sue and redemption division of the
treasury, and they shall not be reis
sued, but canceled and destroyed.
Sec. 4. That after the national
banks have assumed the current re
demption of one hundred and thirty
millions of United States notes, and
the United States shall have re
deemed, canceled, and destroyed sixty
five millions of United States notes, in
accordance with section two of this Act,
any national bank which has not as
sumed the current redemption of any
United States notes as hereinbefore
provided may then take out an amouut
of circulation equal to ten per centum
of its capital, and from year to year
thereafter additional amounts of cir
culation in accordance with the pro
visions of section two of this Act; but
upon the first twenty per centum of
the total circulation to which it is en
titled under this Act, it shall pay into
the treasury of the United States, on
the first days of January and July of
each year, five-eighths of one per cen
tum upon the' average amount of sucr
notes in actual circulation during tli2
preceding six months, and upon all
such notes taken out for issue In ex
cess of said twenty per centum tho
same tax as prescribed in section two
of this Act.
Sec. 5. That before any national
bank .shall receive any of the bauk
notes referred to in this section it
shall first deposit in the treasury f
the United States as a guaranty of
tho payment thereof, an amount of
United States bonds or gold coin, or
both, equal to five per centum of the
amc nt of notes so taken out, and such
deposit stall be counted as a part o
the lawful reserve of said bank. The
. interest upon, said bonds shall be paid
to the bank so depositing them, and
if said bank shall retire said circula
tion, or any portion thereof, an amouut
of bonds or gold coin, or both, equal
to five, per centum of the notes so re
tired shall be returned to said bank:
Provided, however, that if it should
be necessary to sell said bonds for the
purpose defined in section eleven of
this Act, the secretary of the treas
ury is hereby authorized to dispose
of the same and use the proceeds in
accordance with the provisions of law
contained in said section.
Sec. 6. That all the bank notes
taken out for issue in accordance with
the provisions of this Act shall be fur
nished by the United States at the ex
pense of the respective banks issuing
them, and shall be in denominations
of ten dollars and multiplies thereof.
Sec. 7. That such notes shall be a
first Hen upon the asset3 of the respec
tive banks issuing them, and shall be
received upon deposit and for all pur
poses of debt or liability by every na
tional bank at ptfr and without any
charge of whatsoever kind.
Sec. 8. That the total amount of
circulating notes of all kinds of any
national bank may equal,, but shall
not at any time, exceed, the. amount o
itspaid-up capital. - ?
Sec t9t. That, any.mational. -bank
having notes -outstanding to secure
tho payment of which United States
bonds have been deposited may, upon
the deposit of lawful money for the
redemption of said notes, tako out for
circulation the notes provided for in
this Act, in the manner and at the
times specified, without reference to
the limitation of three million each
month, prescribed in section nine of
tho Act approved July twelfth .eigh
teen hundred and eighty-two.
Sec. 10. That the secretary of the
treasury is hereby authorized, in his
discretion, to deposit all the money
of tho United States in excess of fifty
million dollars, except that in the is
sue and redemption division of tha
treasury, in national banks, upon the
condition that said banks shall first
deposit in the United States treasury
United States bonds equal in amount
at par to the sum to be so deposited;
and such banks shall, on the first days
of January and July of each year, pa
interest thereon to the United 3tat3
at the rate of one per centum per an
num upon the average balances of the
preceding six months, but such banks
shall not be required to hold any re
serve against such deposits.
Sec. 11. That the United States
bonds and the gold coin deposited by
the banks as aforesaid, all the money
received for taxes upon the banlc-note
circulation (except that heroin other
wise appropriated), and all the inter
est upon the deposits of the United
States with national banks, when paid
into the treasury shall be set aside
and constitute a fund which shall be
designated as the guaranty and re
demption fund.
First. A fund to pay circulating
notes of any national bank outstanding
at the time of its failure. But tho
United States treasury shall recover
from the assets of the failed bank an
amount equal to its outstanding noto-3,
and the same shall be paid into the
guaranty and redemption fund.
Any national bank desiring to go
into liquidation shall first pay into
the guaranty and redemption fund an
amount of gold coin equal to the
amount of its notes then outstanding.
If said fund shall-for any reason fall
below an amount equal to three per
centum of the total amount of the
bank notes taken out in accordance with
the provisions of this Act, the board
of control may impose an extraordi
nary tax, not exceeding one per cen
tum in any one year, upon the amount
of the notes at the time outstanding;
but such extraordinary tax shall be re
funded to the respective banks when
ever such repayment shall not reduce
said fund below an amount equal to
five per centum of all the notes out
standing. Second. A fund the accumulations
of which In excess of an amount equal
to ten per centum of all tho notes
taken out for circulation shall be ap
plied to the redemption for cancella
tion of those United States notes
which the banks have assumed to cur
rently redeem: but this redemption
shall be in the inverse order of the
assumption of their current redemp
tion by the banks: Provided, that
no such application of said fund shall
be made as will reduce the same below
five million dollars.
Sec. 12. That if any national bank
ing association which has undertaken
to currently redeem any United States
rotes as aforesaid shall fail or liqui
date, such United States notes shall
be redeemed by the government out of
the issue and redemption division, and
Ehall not be reissued, but shall be
canceled and destroyed; but as soon
as the amount so paid out can be
transferr;d from the guaranty and re
demption fund to the issue and re
demption division -without reducing
the same -below an amount equal to
ten per centum of all the banlc notes
taken out in -accordance with the pro
visions of this Act; the same shall be
done: Provided,- that the amount in
the guaranty and redemption fund
W.v
shnll in no caso bo reduced below five
million dollars
Sec. 13. That no national bank, af
ter notlco in writing has been given
that tho United States Is prepared and
desires to redeem any particular
United States notes whoso current re
demption lias been assunio'd by any na
tional bank, shall pay out or hold tho
samo in its reserve, but shall forth
with return them to tho treasury for
redemption.
Sec. ,14. That when, all of the
United States notes whose current re
demption was assumed by national
banks have been redeemed, canceled,
and destroyed, or provision has beca
made for their redemption by deposit
ing in the issue and redemption di
vision an amount of gold coin equal
to the amount of thoso notes still out
standing, in which case they shall bo
redeemed out of said fund, and shall
not be reissued, but shall be canceled
and destroyed, the taxes upon the bank
notes taken out for issue in accordanco
with the provisions of this Act shall
thereafter bo one-quarter of one per
centum per annum upon the note cir
culation up to sixty per centum of
the capital of tho respective banks Is
suing it, and all tho accumulations in
said guaranty and redemption fund
in excess of said ten per centum sha'il
bo paid into tho general fund of th6
treasury.
Tho secretary of the treasury is
hereby authorized to keep said guar
anty and redemption fund Invested In
United States bonds.
Sec. 15. That the said board of
control may grant charters to clear
in?? houses running for twenty years,
with such capital and powers to ef
fect clearanco between banks, bank
ers, trust companies, and other finan
cial associations and to do and per
form such other business and service
as said board of control may dpprovo.
Sec. 16. That tho said board of con
trol shall divide tho United States
into clearing-house districts, and each
clearing-house district shall have one
clearing-house city for all tho bank
notes issued by the banks located in
said district, and every bank which
has taken out circulation for issue in
acordance with the provisions of this
Act snail belong to some particular
district, and the notes so taken out
shall belong to some particular dis
trict, and tho notes so taken out shall
bear in bold and clear figures the num
ber of the district to which tho bank
issuing them belongs; but any national
banking association may have an
agency for the redemption" of its bank
notes in each of the clearing-house
cities.
Sec. 17. That the bank notes taken
out for issue in accordance with tho
provisions of this Act shall be re
deemed on demand In gold coin at tho
home ofilce of the banlc issuing them,
and if said bank is located outside c
a clearing-house city it shall then se
lect a national bank as its agent in th3
clearing-house city of the district to
which it belongs, which shall'upon de
mand redeem said notes in gold coin,
or for said clearing house its agent
for such redemption, or for the trans
action of any other business, and any
money deposited at said clearing house
by any national banking association
for such purpose may be regarded as
a part of its lawful reserve.
Sec. 18. That if any national bank
shall receive such circulating notes of
any other national bank, located out
side of its own district, it shall not
pay them out over its own counter,
unless the bank of issue has an agency
in said district for the redemption of
said notes In gold coin, but shall for
ward them either to some bank in tho
district to which the notes belong, or
to somo bank in the district to which
the notes belong, or to tho clearing
house, or to some bank located in the
clearing-houso city of "its own district,
and then they shall be returned to tho
bank-Issuing-them or to the clearing
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