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Annual Report 1970Comptroller of the Currency

The Administrator of National Banks

William B. CampComptroller of the Currency

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

For sale by the Superintendent of Documents, U.S. Government Printing OfficeWashington, D.C. 20402 - Price $2.50

Stock Number 4801-0006


Letter of Transmittal

TREASURY DEPARTMENT,

OFFICE OF THE COMPTROLLER OF THE CURRENCY,

WASHINGTON, D.C., SEPTEMBER 30, 1970

SIRS: Pursuant to the provisions of Section 333 of the United StatesRevised Statutes, I am pleased to submit the 1970 Annual Report ofthe Comptroller of the Currency.

Respectfully,WILLIAM B. CAMP,

Comptroller of the Currency.THE PRESIDENT OF THE SENATE

THE SPEAKER OF THE HOUSE OF REPRESENTATIVES

HI


ContentsTitle of Section Page

I. Condition of the National Banking System 1II. Income and Expenses of National Banks 3

III. Structural Changes in the National Banking System 5IV. Bank Examinations and Related Activities 13V. Litigation 14

VI. Fiduciary Activities of National Banks 19VII. International Banking and Finance 20

VIII. Administrative and Management Developments 21IX. Financial Operations of the Office of the Comptroller of the Currency 25

Appendices

A. Merger Decisions, 1970 29B. Statistical Tables 181C. Addresses and Selected Congressional Testimony of the Comptroller of the Currency 253

Index 271


Statistical TablesTable No. Title Page

1 Assets, liabilities, and capital accounts of Nationalbanks, 1969 and 1970 2

2 Income and expenses of National banks, 1969 and1970 4

3 National banks and banking offices, by States,Dec. 31, 1970 6

4 Applications for National bank charters, andcharters issued, by States, calendar 1970 7

5 Applications for National bank charters to beissued pursuant to corporate reorganizations,and charters issued, calendar 1970 8

6 Applications for conversion to National bankcharters, and charters issued, by States, calen-dar 1970 9

Table No. Title Page

7 Branches of National banks, calendar 1970 108 De novo branch applications of National banks,

by States, calendar 1970 119 De novo branches of National banks opened for

business, by community size and by size of bank,calendar 1970 12

10 Mergers, calendar 1970 1211 Office of the Comptroller of the Currency: balance

sheet, 1969 and 1970 2612 Office of the Comptroller of the Currency: state-

ment of revenue, expenses and Comptroller'sequity, 1969 and 1970 27

13 Office of the Comptroller of the Currency: state-ment of source and application of funds, 1969and 1970 28

VI


I. Condition of the National Banking SystemThe year 1970 saw a transition from drum-tight

funds markets early in the year to relative ease inmarkets later. Balance-sheet changes for Nationalbanks reflected that shift; their ability to competefor funds was greatly strengthened by the June sus-pension of Regulation Q ceilings on single-matur-ity, large-denomination time deposits with maturi-ties under 90 days.

Total deposits of National banks increased 10.7percent during 1970; that figure, however, masksthe great disparity between growth of time and de-mand deposits. While demand deposits showed anincrease over the year of 2.9 percent, time and sav-ings deposits spurted by 20.2 percent.

The changes in asset composition during 1970

show that the period of relative ease was utilized byNational banks to rebuild their liquidity. Whiletotal assets grew by 8.6 percent, to $340.9 billion,total securities held jumped by 20.2 percent. Thatfigure contrasted with the relatively small increasein outstanding loans of 3.2 percent, to a total of$177.2 billion.

Total capital of National banks increased 7.0percent during the year, reaching $24.9 billion atyear-end. The states whose National banks led intotal assets were New York, with $1.6 billion atthe end of the year; California, with $45.9 billion;Illinois, with $27.8 billion; and Texas, with $22.1billion.


TABLE 1

Assets, liabilities, and capital accounts of National banks, 1969 and 1970

[Dollar amounts in millions]

Dec. 31, 1969,4,669 banks

Amount Percentdistribution

Dec. 31, 1970,4,621 banks

Amount Percentdistribution

Change, 1969-1970

Amount Percent

Cash and due from banks.

U.S. Treasury securitiesSecurities of other U.S. Government agencies and cor-

porationsObligations of States and political subdivisionsOther securities

Total securities.

Federal funds sold and securities purchased under agree-ments to resell

Direct lease financingLoansFixed assetsCustomers' liability on acceptances outstanding.Other assets

Total assets.

LIABILITIES

Demand deposits of individuals, partnerships, and cor-porations

Time and savings deposits of individuals, partnershipsand corporations

Deposits of U.S. GovernmentDeposits of States and political subdivisionsDeposits of foreign governments and official institutions,

central banks, and international institutionsDeposits of commercial banksCertified and officers' checks, etc

Total deposits.

Demand depositsTime and savings deposits

Federal funds purchased and securities sold under agree-ments to repurchase

Liabilities for borrowed moneyAcceptances executed by or for account of reporting

banks and outstandingOther liabilities

Total liabilities

Minority interest in consolidated subsidiaries. .

RESERVES ON LOANS AND SECURITIES

Reserves on l o a n s . . . .Reserves on securities.

CAPITAL ACCOUNTS

Capital notes and debentures.Preferred stockCommon stockSurplusUndivided profitsReserves

Total capital accounts

Total liabilities and capital accounts.

$54,727

29,589

4,64034,5261,362

70,117

5,809696

171,7025,2801,8383,879

314,048

$105,961

103,2383,17519,569

2,13816,6495,696

256,426

141,092115,334

9,9472,284

1,88016,472

287,009

3,69887

1,12062

6,16610,4884,707

711

23,254

314,048

17.43 $56,040 16.44 $1,313

9.42

1.4810.99

.43

34,223

6,68141,5421,800

10.04

1.9612.19

.53

4,634

2,0417,016438

22.32 84,246 24.71 14,129

1.85.22

54.671.68.59

1.24

10,436790

177,2025,9112,0544,227

3.06.23

51.981.73.60

1.24

4,62794

5,500631216348

100.00 340,906 100.00 26,858

33.74

32.871.016.23

.695.301.81

$107,768

119,8435,06125,053

3,38618,4944,179

31.61

35.151.487.35

.995.431.23

$1,807

16,6051,8865,484

1,2481,845

-1,517

81.65 283,784 83.24 27,358

44.9336.72

3.17.73

.605.24

145,122138,662

11,8301,280

2,09613,204

42.5740.67

3.47.38

.613.87

4,03023,328

1,883-1,004

216-3,268

91.39 312,194 91.57 25,185

1 1

1.17.03

3,74789

1.10.03

492

.36

.021.963.341.50.23

1,16163

6,45710,6595,864671

.34

.021.893.131.72.20

411

291171

1,157-40

7.40 24,875 7.30 1,621

100.00 340,906 100.00 26,858

2.40

15.66

43.9920.3232.16

20.15

79.6513.523.20

11.9511.758.97

8.55

1.70

16.0859.4028.02

58.3711.08

-26.63

10.67

2.8620.23

18.93-43.96

11.49-19.84

8.77

1.332.30

3.661.614.721.63

24.58-5 .63

6.97

8.55

NOTES: The 1969 and 1970 data reflect consolidation of all majority-owned bank premises subsidiaries and all significant domesticmajority-owned subsidiaries, with the exception of Edge Act subsidiaries.

••• -»-̂ i • _ J ? . _ ^ j__ _ ir 1 j . i ffl> rr\r\ r\r\f\


II. Income and Expenses of National BanksThe relative shift from loans to securities dur-

ing 1970 was reflected in the aggregate income andexpense data for National banks. Interest on securi-ties increased 13.7 percent over the 1969 figure,reaching $3.6 billion for 1970. In contrast, loanincome increased only 9.7 percent. The latter ac-counted for 67.0 percent of all operating incomeof National banks in 1970, compared to 68.6 per-cent the preceding year.

Total operating income of National banks was$20.4 billion in 1970, representing a 12.1 percentyear-to-year increase. Total operating expenses roseat an even greater rate, 14.0 percent, to reach$16.3 billion. As a result, income before taxes and

securities transactions increased only 5.5 percentover the previous year's figure.

Interest paid on deposits increased only 3.0percent during 1970, but the $6.2 billion total stillaccounted for 38.1 percent of total operating ex-penses. Salaries and wages spurted 12.8 percent in1970, with the $3.8 billion total representing 23.6percent of operating expenses.

With securities losses lower in 1970 than in 1969,and applicable income taxes virtually unchanged,net income of National banks rose 11.6 percent,from $2.5 billion to $2.8 billion. Cash dividendsdeclared during 1970 totalled $1.3 billion.


TABLE 2

Income and expenses of National banks*, 1969 and 1970


Number of banks

Operating income:Interest and fees on loansIncome on Federal funds sold and securities

purchased under agreements to resellInterest and dividends on investments:

U.S. Treasury securitiesSecurities of other U.S. Government agen-

cies and corporationsObligations of States and political subdi-

visionsOther securities

Trust department income .Service charges on deposit accountsOther service charges, collection and exchange

charges, commissions, and feesOther operating income

Total operating income . . . .

Operating expense:Salaries and wages of officers and employees. . .Pensions and other employee benefitsInterest on depositsExpense of Federal funds purchased and secu-

rities sold under agreements to repurchase. . .Interest on borrowed moneyInterest on capital notes and debenturesOccupancy expense of bank premises, netFurniture and equipment, depreciation, rental

costs, servicing, etcProvision for loan losses (or actual net loan

losses)Other operating expenses

Total operating expense

Income before income taxes and securities gains orlosses

Applicable income taxesIncome before securities gains or lossesNet securities gains or losses (after tax effect)Net income before extraordinary itemsExtraordinary charges or creditsMinority interest in consolidated subsidiaries

Net income

Cash dividends declared:On common stockOn preferred stock . . . .

Total cash dividends declared . .

Ratio to income before income taxes and securities:Applicable income taxes .Net securities lossesExtraordinary charges or credits

Ratio to total operating income:Salaries and wairesInterest on depositsAll other ODeratincr exDenses

Total operating expenses

Net income

Dec. 31, 1969

Amount

4,669

$12,492.6

473.2

1,524.7

264.2

1,302.281.6

562.4659.1

426.8434.5

18,221.2

3,402.6530.0

6,036.2

777.1255.856.3

618.8

467.4

296.21,865.6

14,306.0

3,915.21,259.12,656.1-125.72,530.3

4.0

2,534.3

1,063 74.4

1,068 1

Percentdistribution

68.55

2.60

8.37

1.45

7.15.45

3.093.62

2.342.38

100.00

23.783.71

42.19

5.431.79

.394.33

3.27

2.0713.04

100.00

32.163.21

.10

18.6733.1326.71

78.51

13.91

Dec. 31, 1970

Amount

4,621

$13,698.4

602.9

1,654.1

327.0

1,535.390.7

626.2686.4

534.8677.9

20,433.7

3,838.6625.2

6,215.2

937.5169.855.2

723.8

546.6

405.62,784.7

16,302.0

4,131.71,239.92,891.8

-64 .52,827 3

2.1

2,829 3

1,273.0

Percentdistribution

67.04

2.95

8.09

1.60

7.51.44

3.073.36

2.623.32

100.00

23.553.84

38.12

5.751.04

.344.44

3.35

2.4917.08

100.00

30 011.56

.05

18.7930.4213.63

79.78

13.85

Change, 1969-1970

Amount

$1,205.8

129.7

129.4

62.8

233.19.1

63.827.3

108.0243.3

2,212.5

436.095.2

179.0

160.4-86 .0- 1 . 1105.0

79.2

109.5919.1

1,996.0

216.5-19 .2235.761.2

297.0- 1 . 9

0

295.0

209.3.3

209.6

Percent

9.65

27.41

8.49

23.77

17.9011.1511.344.14

25.3056.02

12.14

12.8117.962.97

20.64-33.62-1 .9516.97

16.94

36.9349.27

13.95

5.53-1 .52

8.8748.6911.74

-47.50

11.64

19.686.82

19.62

"Includes all banks operating as National banks at year-end, and full year data for those State banks converting to Nationalbanks during the vear.


I I I . Structural Changes in the NationalBanking System

The National banking system comprised 4,621banks, operating 12,366 branches and a total of16,987 banking offices as of year-end 1970. Thebranch figure represented an increase of 819, or7.1 percent, during calendar 1970. That increasecompares with figures of 752 branches, or 7.0percent, during 1969. As a result of mergers andconsolidations, the number of National banks hasdeclined slightly, from 4,669, at the beginning of1970.

Of the 819 new branches, 737 were de novobranches, new branches offering banking servicesto the public for the first time at their respectivesites. Over 58 percent of the de novo branches werelocated in communities with populations under25,000; only 9 percent were located within citieswith populations of over 500,000. Forty-seven per-cent of the de novo branches opened during 1970are operated by banks with total assets of less than$100 million. California, with 87, New York, with77, and Pennsylvania, with 64, led the Nation inde novo branch openings. The difference betweennet branch additions to the system and de novobranches was accounted for by the entry of 186

branches through merger and conversion and thediscontinuation of 104 branches.

Thirty-nine charters were issued for newly-or-ganized National banks in 1970, in comparisonwith 16 in 1969. The unit banking states of Texas,with nine, and Florida, with six, led in this cate-gory. Also, during calendar 1970, preliminary ap-proval was given to 42 charter applications fornewly-organized banks, compared with 33 in 1969.In addition to the charter activity relating to newly-organized banks, 26 charters were issued pursuantto corporate reorganizations, principally for thepurpose of forming bank holding companies.Eleven charters were issued by the Comptrollerfor the conversion of State banks to National banks.

During 1970, there were 80 merger, consolida-tion, or purchase transactions, involving two ormore operating banks, in which the resulting bankwas a National bank. That figure was identicalwith that for 1969. In addition, 25 mergers pur-suant to corporate reorganization and involvingonly one operating bank were consummated during1970.


TABLE 3

National banks and banking offices, by States, Dec. 31, 1970

National banks

Total Unit Withbranches

Number ofbranches

Number of

United States . . . .

AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareDistrict of Columbia. . . .Florida

GeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaine

MarylandMassachusettsMichiganMinnesotaMississippi. . .MissouriMontanaNebraskaNevadaNew Hampshire

New JerseyNew MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode Island

South CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

District of Columbia—all

4,621

8953

6960

12226

511

215

6217

41412299

171804919

4286

101199389849

1254

48

12933

1692242

217203

10299

5

193377

5301026

1012585

12541

1

14

2,982

4301

367

113631

215

3102

3604859

13936114

122230

1975

7548

1011

25

238

663

3269

1683

1380

42417

5305

11268

8590410

1

1,639

13

12,366

465233539202100

311554744032443815

30647123323124323

106251031910148357

1615

159600515751703501

1895021582

2,3709

2214660

1659

108543395432141181101

2534285606

142231256051

68273

1,2615491074235249

1,05092

240582760744947544006507

101

*Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of theCurrency.


TABLE 4

Applications for National bank charters, * and charters issued\ * by States, calendar 1970

Received^ Approved Rejected Abandoned PendingDec. 31, 1970

Chartersissued

United States

AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareDistrict of ColumbiaFlorida


MarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew Hampshire. . .


South Carol ina . . . .South DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

159 42 46

20014

13200

33

3008111011

1154030000

14061001000

001

3800241420

000102000

10

0003100000

0141000000

5021000000

000700101200

62

100015200

14

0002011001

0010000000

4010001000

000

2200110120

*Excludes conversions and corporate reorganizations,tincludes 45 applications pending as of Dec. 31, 1969.


TABLE 5

Applications for National hank charters to he issued pursuant to corporate reorganizations, and charters issued, by States,calendar 1970

Received* Approved Rejected Abandoned PendingDec. 31, 1970

Chartersissued

United States



MarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew Hampshire

New JerseyNew MexicoNew YorkNorth Carol ina . . . .North DakotaOhioOklahomaOregonPennsylvaniaRhode Island

South Carol ina . . . .South DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

33 31

1000100000

000100001

0

0110040000

12010050000

000400100000

1000100000000000001

0

0110040000

12010050000

000300100000

•Includes 1 application pending as of Dec. 31, 1969.


TABLE 6

Applications for conversion to National bank charters, and charters issued, by States, calendar 1970

Received* Approved Rejected Abandoned

1

0000000001

0000000000

0000000000

0000000000

000000000000

PendingDec. 31', 1970

3

0000000000

0000100000

0000002000

0000000000

000000000000

Chartersissued

United States



MarylandMassachusettsMichiganMinnesotaMississippiMissouriMontanaNebraskaNevadaNew Hampshire. . .


South Carolina. . . .South DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

16 10

0000000001

0000000000

0000001000

0000000000

000000000000

"Includes 4 applications pending as of Dec. 31, 1969.


TABLE 7

Branches of National banks, calendar 1970

Branches inoperation

Dec. 31, 1969

De novobranches

opened forbusiness

Jan. 1-Dec. 31,1970

Branchesacquiredthrough

merger orconversion

Jan. 1-Dec. 31,1970

Existingbranches

discontinuedor consolidated

Jan. 1-Dec. 31,1970

Branchesin operation

Dec. 31, 1970

United States... .

AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareDistrict of Columbia....Florida






Ml,547 737

17347

19978

2,2932

2053

640

1557

10644

3185127

13516791

239406533

612720

1225645

60267

1,163495

9*691

3724097988

22255

'2590

6145

'437414

05706

142

164

877

14130

1120

1017456

139

1622300

1130345

576

7740

145

310644

221

18063

35170801

186

2100

1205000

0020500012

6610400001

340

23190700

310

020071590000

104

0000

2203010

1000110001

8640000000

110250151

240

401000200000

12,366

18950

21582

2,3709

2214

660

1659

10854

3395432

141181101

253428560

614223

1256051

68273

1,261549

1074235

2491,050

92

24058

2760

7449

475440

065

07

97 101

*Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of theCurrency.

r Revised.

10


TABLE 8

De novo branch applications of National banks, by States, calendar 1970

Received* Approved Rejected Abandoned PendingDec. 31, 1970

United States






District of Columbia—all t

1,255 782

171023

51841225

0120

6207

1331

727

1110

5332710

1252434

7811

168740

488

11755

231

170

102

74180800

124

165

1151222050

7069

2162677

3525300722423

538

113380

3986

523

140

13071

39110500

15

152

1330

4100000

0000200131

53

210200010

110

1920303

100

402000830000

53

0100700000

11001000001

5060100001

2073010000

001011210000

268

4240

2103070

44013810011

84

140230000

123

29310502

132

511020

2530300

*Includes 266 applications pending as of Dec. 31, 1969.tincludes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the

Currency.

11


TABLE 9

De novo branches of National banks opened for business, by community size and by size of bank, calendar 1970

Population of cities Branches Total resources of banks[millions of dollars]

Branches

Less than 5,000 1795,000 to 24,999 25225,000 to 49,999 9050,000 to 99,999 64100,000 to 249,999 45250,000 to 499,999 40500,000 to 1,000,000 24Over 1,000,000 43

Total 737

Less than 10.0 7010.0 to 24.9 12425.0 to 49.9 8650.0 to 99.9 69100.0 to 1,000.0 220Over 1,000.0 168

Total 737

TABLE 10

Mergers, * calendar 1970

Transactionsinvolving

two or moreoperating banks

Other, pursuantto corporate

reorganizations

Applications carried over from 1969 15 3Applications received 1970 79 26Disposition of applications 1970:

Approved 80 24Abandoned 2 0

Applications pending December 1970 12 5Transactions completed 1970:

Mergers 60 25Consolidations 10 0Purchase of assets 10 0

Total completed 80 25

The aggregate total capital stock and capital accounts for the certificates issued are as follows: fMerging,

Charter or consolidating,purchasing bank or selling bank Combined

Capital stock $817,785,022 $63,961,298 $881,012,920Capital accounts 2,949,470,801 207,439,895 3,168,016,022

*Includes mergers, consolidations and purchase and sale transactions where the resulting bank is a National bank."(•Includes only those transactions involving 2 or more operating banks.


IV. Bank Examinations and Related ActivitiesThe National Bank Act requires that all Na-

tional banks be examined twice in each calendaryear, but the Comptroller, in the exercise of hisdiscretion, may waive one such examination in a2-year period, or may cause such examinations tobe made more frequently, if considered necessary.In addition, the District Code authorizes the Comp-troller to examine each non-National bank andtrust company in the District of Columbia.

This year was, once again, the most active in thehistory of the Comptroller's Office. During theyear ending December 31, 1970, the Office examined7,084 banks, 14,777 branches and facilities, 1,590trust departments and branches, 232 affiliates andsubsidiaries, and conducted 402 special examina-tions and visitations. Investigations were conductedin connection with applications for 1,996 de novobranches, four State banks were examined in con-nection with conversions to National banks, andthe Office received 145 applications to establish newNational banks. That latter figure includes sevencorporate reorganizations.

National bank examinations are designed to de-termine the condition and performance of banks,the quality of their operations, the capacity ofmanagement, and whether the banks are complyingwith Federal laws. All facets of an examinationhave, as their end result, the determination ofliquidity and solvency, present and prospective,and the determination of whether the bank isoperating within the framework of applicablebanking laws and regulations. The appraisal of abank's loans and lending policies, investments andinvestment policies, and the ability and capacity ofits management constitute the most exacting phasesof the examination process.

As of December 31, 1970, the Office employed1,635 examining personnel, 1,537 commercial ex-aminers and 98 trust examiners. During 1970, ef-forts were conducted to improve the quality and

efficiency of examinations. New assistant examinerswere provided with monitored on-the-job training,nine sectional schools, and a self-instructional pro-gram which was implemented during 1970. TheNational Bank Examiner's School continues to beof prime importance in the career developmentprogram of examining personnel. Those schoolsare attended by all recently-commissioned NationalBank Examiners, and the curriculum covers allaspects of commercial examinations. Loan and in-vestment analysis, determination of asset quality,and evaluation of bank management receive thegreatest emphasis. Considerable time is also devotedto diversification of risk, liquidity, capital adequacy,earnings, bank operations, investment in fixedassets, borrowings, future prospects, and review ofthe various laws and regulations affecting Nationalbanks.

The more senior National Bank Examiners be-gan attending 5-day EDP seminars during 1970.Those training sessions are intended to updatethe examiners' knowledge of EDP equipment andexamination procedures and techniques. It is anti-cipated that 750 examiners will have completedsuch training by the end of 1971. Training andinstruction is supplemented by correspondencecourses offered by the American Institute of Bank-ing and Dun and Bradstreet. Also, every year, anumber of our examining personnel graduate fromthe various graduate schools of banking.

The comprehensive Comptroller's Handbook ofExamination Procedure, an internal manual cover-ing all areas of banking examination, published in1969, was supplemented during 1970 by a new in-structional booklet, EDP Examination Procedures.The booklet standardizes EDP examination proced-ures and establishes minimum standards of output.The Office will continue its efforts to review and up-date training programs and examining techniquesin the months and years ahead.


V. LitigationThe rise in the number of cases filed challenging

administrative actions or rulings of the Comp-troller that began during calendar 1969, continuedvirtually unabated through 1970. Twenty newcases were filed during 1970. There were 31 casespending on January 1, 1970; 23 cases were termi-nated during the year; and 28 cases were pendingat the end of calendar year 1970.

The Comptroller's ruling was overturned by thecourts in only two of the 22 cases terminated. Themore significant cases involved the following sub-jects:

A. Incidental Powers Cases

Three cases involving the standing of competi-tors of National banks who allege that the activi-ties of particular National banks exceed the author-ity contained in the incidental powers clause ofthe National Bank Act, 12 U.S.C. §24 (Seventh),were reviewed by the Supreme Court during 1970.The Supreme Court review was prompted whentwo circuit courts of appeals reached diametricallyopposed conclusions in two substantially identicalcases, brought by data processing service bureaus,challenging the right of a National bank to offerdata processing services to other banks and bankcustomers, as is permitted by the Comptroller.ADAPSO v. Camp, 406 F.2d 837 (8th Cir.); TheWingate Corp. v. Industrial National Bank ofRhode Island, 408 F.2d 1147 (1st Cir.). In a far-reaching opinion, reinterpreting the law of stand-ing as it applied to suits against all federalagencies, the Supreme Court held in ADAPSO v.Camp, 397 U.S. 150, that data processing servicebureaus do have standing to bring suit in federalcourt to challenge the authority of a Nationalbank to sell data processing services. On the au-thority of its ruling in ADAPSO, the SupremeCourt also held that Section 4 of the Bank ServiceCorporation Act also confers standing upon travelagents to contend, contrary to the Comptroller's

ruling, that National banks lack incidental powerto operate a travel agency. Arnold Tours, Inc. v.Camp, 39 L.W. 3226.

Since the Supreme Court decisions did not reachthe ultimate issues on the merits, i.e., whetherNational banks are authorized by the NationalBank Act to provide travel agency and data proc-essing services, the cases were returned to thedistrict courts for further proceedings. No furtherproceedings in the district courts had taken placeat year end 1970.

B. Other Banking Powers

1. Collective Investment Funds. A case chal-lenging the authority of National banks possessingtrust powers to operate a commingled managingagency account awaited decision by the SupremeCourt at the end of 1970. Camp v. InvestmentCompany Institute, O.T. 1970, No. 61. The Su-preme Court review had been requested by ICIafter the Court of Appeals for the District ofColumbia, in a unanimous opinion, upheld theauthority of the bank to operate the account. Thecase involves a commingled agency fund estab-lished by First National City Bank of New Yorkwith the specific approval of the Comptroller, theSEC, and the Board of Governors of the FederalReserve Board. Writing prior to the SupremeCourt's reinterpretation of the law of standing inADAPSO, two judges of the court expressed "res-ervations amounting to virtual disbelief" in thestanding of the plaintiff mutual fund industry tobring the suit. Chief Judge Bazelon noted that thecommingled managing agency account was "a de-scendent of the individual managing agency ac-count and the common trust fund, fitting withinthe traditional authority of banks to manage otherpeople's money in a fiduciary capacity." All threejudges concurred in finding that the approvalgiven by each of the involved federal agencieswas within its respective statutory authority.

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2. Receiving Interest on Credit Card Transac-tions. Two cases, brought during 1969, by theState of Idaho, against the Comptroller and twoNational banks headquartered in Boise, Idaho,were scheduled at the end of 1970 for trial in 1971.The district court ruled, in response to severalmotions, that the State Commissioner of Financehad standing to maintain the actions. State ofIdaho v. First Security Bank, N.A. and Camp,Civil No. 1-69-83; State of Idaho v. Idaho FirstNational Bank & Camp, Civil No. 1-69-101. TheThe State Commissioner contends that each ofthe National banks involved charges, on certaincredit card transactions, an interest rate higherthan that which State banks could charge on simi-lar transactions. The Comptroller is made a de-fendant because he has interpreted Section 30 ofthe National Bank Act, 12 U.S.C. §85, to permitNational banks to charge the same interest ratethat any competing State institution, e.g., a smallloan company, could charge on similar loans.

C. New Banks

1. Cases Brought by Competitors. Three suitsagainst the Comptroller's Office, in which existingbanks alleged that the Comptroller's charteringof a new competing National bank was unlawful,were pending at the end of 1970. Sterling NationalBank v. Camp, 431 F.2d 514 (5th Cir. 1970);Humble State Bank v. Camp, S.D. Texas, CivilNo. 69-H-1209; and Somerset Trust Co. v. Camp,D. N.J., Civil No. 659-70. In Sterling, the FifthCircuit Court of Appeals held that the recorddeveloped by the Comptroller's Office in processingthe application showed the Comptroller's decisionto be rational and lawful, and that the Comptrol-ler's approval was not invalidated either (1) by hisreceipt of information from the applicant ex parteor (2) by the lack of an opinion accompanyingthe Comptroller's determination. Plaintiff inSterling has requested review of the Fifth Circuitdecision by the Supreme Court, but, at year-end1970, the court had not acted upon plaintiff'spetition. The Humble case was pending at the endof the year on motions by the Comptroller todismiss for lack of standing, or, in the alternative,to grant summary judgment for the Comptroller,because the record developed by the Comptroller'sOffice in processing the application showed theComptroller's decision to be in accordance with

law. At year-end, no proceedings had taken placein the Somerset Trust case, other than the filingof an amended complaint by plaintiffs.

2. Cases Brought by Applicants. At the endof 1970, two actions were pending by organizersof proposed National banks, challenging the re-fusal of the Comptroller to charter -the appliedfor bank. Klanke v. Camp, S.D. Texas, Civil No.69-H-1033 and Pitts v. Camp, D. S.C., Civil No.69-979. The Klanke and Pitts cases awaited furtherproceedings after the district courts had ruled, inresponse to preliminary motions by the Comp-troller, that the courts had jurisdiction to reviewthe Comptroller's exercise of discretion in reject-ing a National bank charter application. An addi-tional case, challenging the refusal of the Comp-troller to charter a National bank, was voluntarilydismissed by plaintiffs during the year. Olsen v.Camp, E.D. Mich., Civil No. 31804.

D. Main Office Relocations

1. Cases Brought by Competitors. Four cases,involving challenges, by competitors, of the Comp-troller's approval of the relocation of a Nationalbank's main office, resulted in opinions during theyear upholding the Comptroller's decision. In TheRamapo Bank v. Camp, 425 F.2d 333, the ThirdCircuit Court of Appeals upheld the Comptroller'sapproval of a New Jersey National bank's simul-taneous applications to relocate its main officeto a different town 2.3 miles away, and to retainits former main office as a branch. The SupremeCourt declined to review that decision, and thusleft it standing as final. While the Ramapo casewas pending, federal district courts granted judg-ment for the Comptroller in three additional simi-lar cases in New Jersey. Peoples Trust Co. v. Campand Hackensack Trust Co., N.A., D. N.J., CivilNo. 1191-69, Midland Bank & Trust Co. v. Campand Hackensack Trust Co., D. N.J., Civil No.1174-69; and Peoples Trust of New Jersey v. Campand Edgewater National Bank, D. N.J., Civil No.1121-69. In addition to the cases arising in NewJersey, the decision of the Seventh Circuit inMarion National Bank v. Camp, 418 F.2d 121(Jan. 1970), which was partially contrary to thelater holding of the Ramapo court, became finalduring 1970, when neither party appealed. TheMarion court held that the Comptroller couldnot, as part of "a single indissoluable process",

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approve simultaneous applications by a State-char-tered bank in Indiana to convert to a NationalAssociation, to relocate its main office to the countyseat 12 miles away, and to retain a branch at thesite of its former main office. Subsequent to theSeventh Circuit's decision, the Indiana bank, aspermitted by the Court of Appeals' opinion, with-drew the branch portion of its application, con-verted to a National Association, and moved itsmain office. The bank then filed a new applicationfor a branch at its former main office site, whichapplication was approved by the Comptroller. Thenet effect of the Marion decision was to leave anIndiana town without a local banking office for aperiod of approximately 2 weeks.

2. Cases Brought by Applicants. In the firstcase of its kind, a rejected applicant has filed anaction seeking to compel the Comptroller to ap-prove its simultaneous application to relocate itsmain office to another municipality, and to retainits former main office structure as a branch. FirstNational Bank of Southaven v. Camp, D. Miss.,Civil No. DC 7074-K. At year-end 1970, no pro-ceedings had taken place in this case, other thanthe filing of a complaint.

E. Branches

The decision of the Supreme Court in Camp v.Dickinson, 396 U.S. 122, discussed in the 1969Annual Report, became final in 1970, when theSupreme Court denied a petition for rehearing.The ruling of the Supreme Court, in Dickinsonto the effect that an armored car, used by a Na-tional bank in Florida to pick up and deliverfunds from customers of the bank, and an off-premises night depository each constituted a"branch", as that term is defined in the NationalBank Act, 12 U.S.C. §36 (£), appears to have raisedmore questions that it has settled. The Court re-jected the argument advanced by the NationalAssociation of Supervisors of State Banks, in anamicus curiae brief, that State law defined whatwas a branch of a National bank, but held thatthe armored car and receptacle were branches,because "deposits" were received within the mean-ing of 12 U.S.C. §36 (f). Thus there remains someconfusion as to whether similar armored car opera-tions would be branches in States where armoredcars may be operated by State banks. Additionalproblems of interpretation and application may

arise under peculiar circumstances in connectionwith the performance of armored car services bysubsidiaries of bank holding companies. In Jacksonv. First National Bank of Gainesville, 430 F.2d1200, for example, the Fifth Circuit Court ofAppeals held, subsequent to the Dickinson ruling,that, where a messenger service subsidiary of theholding company controlling the First NationalBank of Cornelia, Ga., continued to operate themessenger car service, previously operated by thebank, exactly as it had been operated before, solelyon behalf of the bank, and for the benefit of thebank's customers, and where the armored carservice charged the bank's customers nothing, andhad no visible means of financial support, theperformance of the messenger car service by theholding company subsidiary amounted to prohib-ited branch banking. At year-end 1970, the bankwas seeking Supreme Court review of the FifthCircuit ruling.

In First Citizens Bank & Trust Co. v. Camp,C.A. No. 13859, the Court of Appeals for theFourth Circuit reversed a district court which hadissued a preliminary injunction temporarily over-turning the Comptroller's approval of a branchbank in North Carolina. The appellate courtfound the district court's order, which had issuedeven though the district judge had the Comp-troller's entire administrative record before himand could have granted final judgment for theComptroller, to be an abuse of discretion. Thecourt thus returned the case to the district courtwith instructions to hold a hearing on the damagessustained by the bank by reason of the "improperissuance of the injunction order", and directedthat the district court proceed to a final deter-mination of the case on the merits. Subsequent tothe issuance of this opinion, the plaintiff volun-tarily dismissed the suit. The Comptroller's Officeis hopeful that the Fourth Circuit opinion willdiscourage frivolous litigation commenced by com-petitors merely for the purpose of delaying theopening of competing branch banks.

Three additional cases, brought by competingbanks during 1970, resulted in orders upholdingthe Comptroller's approval of challenged branchapplications. Two of these cases involved challengesto the Comptroller's approval of branch applica-tions for National banks in New Jersey. MontclairNational Bank & Trust Co. v. Camp, D. N.J.,Civil No. 1004-69; Springfield State Bank v. Na-tional State Bank of Elizabeth, D. N.J., No. 846-69.

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In the third case, a United States District Courtin Michigan held that the Comptroller reasonablyconcluded, upon the basis of information pre-sented to him, administratively, that the contestedbranch was not within the same unincorporatedvillage as an already existing branch of the plaintiffbank, located approximately 34 of a mile away,and that under such circumstances, the branchwas permitted by statute and the Comptroller'sdecision must be upheld. National Lumberman'sBank & Trust Co. v. Camp, W.D. Mich., CivilNo. 6179.

F. Merger Cases

In 1970, the Comptroller was a party to sixmerger cases. In two that were litigated to judg-ment, the Court upheld the Comptroller and thedefendant banks and found the mergers to belawful. Both of these cases have been terminatedwith no appeal to the Supreme Court. In one case,the Supreme Court reversed and remanded it tothe district court. In another, a holding companyacquisition, the district court, before trial, is con-sidering the Comptroller's motion to lift the stat-utory stay. In a fifth case, the Comptroller has fileda motion to dismiss the complaint on the groundthat the "section of the country" selected by theAntitrust Division is, as a matter of law, too smallto be a "section of the country'* under §7 of theClayton Act. In the sixth case, a three-bank consoli-dation, a consent decree was entered on December7, 1970, terminating the cause.

In United States v. The First National Bank ofMaryland, 310 F. Supp. 157 (D. Md. 1970), anappeal from the judgment for the Comptroller andthe defendant banks was noticed to the SupremeCourt by the plaintiff on March 20, 1970, but wasdismissed by stipulation on March 30, 1970.

On April 21, 1970, after a lengthy trial, the dis-trict court rendered an opinion in favor of theComptroller and the defendant banks in the marketextension, or potential competition, merger caseof United States v. The Idaho First National Bankand Fidelity National Bank, 315 F. Supp. 261 (D.Idaho 1970). The Antitrust Division elected not toappeal. The court found that Twin Falls, Idaho,with four banks already there, would not support afifth bank entry, and that it was not reasonablyprobable that Idaho First would enter Twin Fallsby branching in the foreseeable future. The court

also found that the anticompetitive effects of themerger, if any, would be clearly outweighed in thepublic interest by improving the quality of bankservices to meet the convenience and needs of theTwin Falls community. The court considered itimportant that the merger would increase the lend-ing limit of Fidelity National and either provideservices not now available through Fidelity, or in-crease services, in the trust area; real estate andconstruction lending, including FHA and VAloans; consumer and installment loans; purchaseof dealers' paper; automobile and mobile homefinancing; and industrial and municipal loans. Themerger would also bring to the area, for the firsttime, regional computer services, investment advice,commercial counseling, and accounts receivablefinancing.

United States v. Phillipsburg National Bank &Trust Co., et al, 306 F. Supp. 645 (D. N.J. 1969),was appealed, and reversed, and remanded by theSupreme Court on June 29, 1970, with Mr. JusticeHarlan and Chief Justice Berger dissenting in part,399 U.S. 350 (1970). The majority opinion foundthat the district court erred in its determination asto the relevant product market and the relevantgeographic market, and that these errors invali-dated the district court's determination that themerger would have no significant anticompetitiveeffect. The product market was found to be com-mercial banking, and the section of the countryto be Phillipsburg-Easton and environs which hada 1960 population of almost 90,000. The Court didnot examine the convenience and needs advancedby the Comptroller and defendant banks becausethe district court had examined them in the wrong"section of the country," so that the convenienceand needs defense still has not been thoroughlyexamined by the Supreme Court. The Court didstate that the banks contention that they lackpersonnel and resources to serve their communityeffectively and to compete vigorously were pro-competitive factors, and certainly relevant in deter-mining the convenience and needs of the commu-nity under the Bank Merger Act. The Court alsoheld that "the community to be served" is virtuallyalways as large, or larger, than the geographicmarket or section of the country, and that theconvenience and needs cannot be measured in asmaller area.

On February 27, 1970, the Antitrust Divisionfiled suit alleging that the acquisition by UnitedVirginia Bankshares, a registered bank holding

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company, of controlling interest in Peoples Na-tional Bank, Manassas, Va., was violative of §7 ofthe Clayton Act in that it would eliminate poten-tial competition between them, would eliminateUnited Virginia Bankshares as a potential entrantinto commercial banking in the Manassas andPrince William County area, and would entrenchthe three dominant banking organizations in thesemarket areas. United States v. United VirginiaBankshares Incorporated, the Peoples NationalBank of Manassas, and Manassas Bank, N.A., CivilNo. 85-70-A, E.D. Va. 1970. The Comptroller,after intervening, filed a motion to lift the statutorystay provided for in the Bank Merger Act (12U.S.C. §1828 (c) (7) (A)) and in the Bank HoldingCompany Act (12 U.S.C. §1849). The Comptrollercontended that there would be irreparable injuryto Peoples National Bank, that the purpose of thestay was to prevent the difficulties of unscramblingof banking assets, and that this problem is notpresent in the acquisition of majority control of abank by a holding company. The Court was con-sidering this motion and a plan agreed upon by thedefendants, and approved by the Comptroller, tofacilitate divestiture, should it become necessary,but no decision had been made as of December 31.

On December 11, 1970, the Antitrust Division

filed a §7 Clayton Act case against the merger ofCounty National Bank of Bennington and Cata-mount National Bank United States v. CountyNational Bank of Bennington and Catamount Na-tional Bank, Civil No. 6088, D. Vt. 1970. The suitalleges the merger may substantially lessen competi-tion in the "Bennington area/' The Comptroller,following intervention, and the defendant bankshave both filed motions to dismiss the complainton the grounds that the "Bennington area/' whichhas a population of 23,733, is too small and eco-nomically insignificant to be a "section of the coun-try" under §7 of the Clayton Act, and that Ben-nington appears to be the type of small town thatCongress intended would not be covered by theAct when the word "community1' was deleted in the1950 amendment. The motions are pending.

On December 7, 1970, a consent decree was en-tered in the three bank consolidation case ofUnited States v. National Bank & Trust Co. ofCentral Pa., et al., Civil No. 69-2902, E.D. Pa.,which in effect allowed the consolidation but re-quired the banks to sell nine branches. It also pro-hibits the consolidated bank from further bankmergers in Dauphin, Lancaster, and York countiesfor 10 years.


VI. Fiduciary Activities of National BanksThe number of fiduciary accounts and the market

value of assets held by trust departments of Na-tional banks continued to grow in 1970. Duringthe year, 45 application for permits to exercisefiduciary powers were received from National banksand 26 were approved. In addition, five State bankswith trust departments converted to Nationalcharters. Taking into account losses through merg-ers and consolidations, the number of Nationalbanks authorized to exercise fiduciary powers had,by year-end, risen to 1,943.

Against this background, the Comptroller's Officecarried out its responsibilities as effectively as possi-ble. Training of personnel continued to have ahigh priority. In April, a two-week school for As-sistants in Trust was held in Washington, D.C.; 32Assistants, from the various regions, attended. Threemembers of the F.D.I.C. trust examining force andone representative from each of the bank super-visory staffs of the states of Connecticut, Wisconsin,New Hampshire, New York, North Carolina,Michigan, Illinois, and Maryland also took part.The course was divided into two parts, one givinga greater understanding of the functions and opera-tions of a trust department, and the other dealingwith the supervisory policies and proceduresthrough which the responsibilities of this Office arecarried out. A number of recognized banking andlegal authorities helped conduct the first portion ofthe course, and the Trust Division staff, assisted byrepresentatives from the field, conducted the second.

A joint seminar with the F.D.I.C. held in Novem-ber for the Associates in Trusts of the Office. Thatcourse was aimed at intermediate level trust ex-aminers who are expected to reach the highest levelof qualification, Representative in Trusts, in the

near future. Fourteen Associates and eight examin-ers from the Federal Deposit Insurance Corpora-tion attended. The first part of that course dealtwith principles of management supervision, and thesecond with emerging examination problems.

During the year, the federal banking agencies in-structed their trust department examiners to en-quire into bank policies relating to the allocationof brokerage business. Later, an opinion was re-ceived from the Justice Department holding thatthe allocation of brokerage business in return forbrokers' deposits may violate the antitrust laws.The examiners were instructed to so advise thebanks. Based upon initial results it appears that thepractice, while perhaps used in years past, is nolonger a factor in placing brokerage business.

The banking agencies continued their closescrutiny of securities fails. Banks were counseled toadopt a procedure of payment on delivery whenpossible. By year-end, it appeared that the instancesof failure to deliver securities paid for by trustdepartments were relatively few. Special attentionwas given to holdings of restricted stock in trustaccounts because of problems of liquidity and valu-ation.

In December, the case of Investment CompanyInstitute v. Camp was argued before the SupremeCourt. (See "Litigation.") The decision, expectedearly in 1971, may have broad implications fordetermining the extent to which the Banking Actof 1933 limits trust department activities. Resolu-tion of those questions should end the uncertaintywhich has prevailed since the suit was brought, andshould enable this Office to draw more definitiveboundaries for such activities.

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VII. International Banking and FinanceDuring this past decade, National banks dis-

played a phenomenal rate of international expan-sion that continued to accelerate during 1970. Atthe beginning of the 10-year period, on December31, 1960, only three National banks had foreignbranches, and their 85 branches reported total as-sets of $1,628 million. In the year 1970, 31 Na-tional banks opened 72 new foreign branches, andat the close of this decade, 59 National banks wereoperating 497 foreign branches with total assets of$38.9 billion. The international activities of Na-tional banks also continued to expand directly,through ownership of foreign banks, and indirectly,through ownership of Edge and agreement corpora-tions, with financing and investing spreading on aglobal basis.

There were no major currency devaluations dur-ing the year and, in addition to this favorable fac-tor, the increase in international activities of Na-tional banks was encouraged by more than averageincentives of growth and profits.

Anti-inflationary monetary policies and the re-lated tight money situation in the United Statesled to a further increase in the supply of Euro-dollars in 1970. That supply, tapped most easily byforeign branches in London and Nassau, was usedby National banks to serve their customers' needfor funds. During the year, 26 new branches ofNational banks opened in Nassau, and 2 opened inLondon. By the end of 1970, 56 National Bankshad 72 branches in operation in London and Nas-sau, and 14 applications for branches in those lo-cations were awaiting approval of U.S. or foreignauthorities.

The International Division of the Office of theComptroller of the Currency was formed duringthe decade to keep pace with these expanding ac-tivities. In 1970, examination reports and pro-cedures were revised to improve the examinationof foreign assets of National banks through theirdomestic head offices, and supplemental, direct visi-tations of foreign branches were more frequent.

By 1970, all of the 14 National bank regions con-tained banks with international activities, so a re-lated representation was developed for the inter-national examining staff. During the year, 43 ex-aminers conducted branch examination in Europe,South American, and the Far East. In November,the first of a series of Sectional Training Schoolson international examination was held in Chicago.Examiners from regions four, seven, and nine at-tended this school; similar schools will be held forexaminers located in other regions.

Continued close cooperation with the FederalReserve Board and the Department of State provedmost beneficial in the supervision and examinationof international offices. That cooperation was ex-tended to the authorities in those foreign countrieswhere National banks are represented. During theyear, numerous bankers and regulatory officialsfrom various foreign countries visited the Interna-tional Division for group discussions and trainingsessions of various lengths. The visitors were pri-marily interested in the function of banking in theUnited States. A number described some of thebenefits derived by their countries from the inter-national activities of National banks.

The circulation of some instruments drawn oncertain foreign banks prompted the issuance of aseries of warning bulletins during 1970. Thisaction, in cooperation with foreign central banksand the Department of Justice, served to avert thehazards posed by those activities.

The need for close supervision of foreign bank-ing activities by the directorates of U.S.-based bankswas repeatedly dramatized during the year. Theclosures of banks in secrecy countries, and in coun-tries with changing political situations, emphasizedthe direct and contingent risks involved in ex-change contracts, investments, and other accountslocated in foreign correspondents, subsidiaries, andbranches.

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VIII . Administrative and ManagementDevelopments

In 1970, the Office of the Comptroller of theCurrency achieved further modernization of its ad-ministrative practices. The five divisions underthe direction of the Administrative Assistant to theComptroller coordinated activities with rewardingresults.

For the Fiscal Management Division, 1970 provedto be an exceptionally challenging year in terms ofthe demands placed upon the financial manage-ment information system. The demands for in-formation arose primarily because of the greaterincrease in expenditures than in revenue. Also,there was an increase in the number and types ofreports on budgetary and financial matters re-quired for submission to the Treasury Department.As a result of the program, initiated in 1967, toproduce a financial information system responsiveto management needs, information was provided ina timely manner, permitting management decisionsto deal effectively with the rising costs of operations.The increased reporting requirements of the Treas-ury Department were met smoothly because com-prehensive financial data was available.

The on-going program of improving andstrengthening the financial system of the Comptrol-ler's Office has thus been justified. Additionalmajor improvements during 1970 included furtherelimination of manual accounting proceduresthrough machine applications and the refinementof existing machine applications. The purpose wasto obtain more accurate and useful informationunder the responsibility-centered cost accountingaspects of the financial system. The most signifi-cant achievement there was the preparation of allmonthly financial statements on an automatedbasis. As 1970 came to a close, studies and analyseswere underway concerning the feasibility and needfor assigning general overhead costs to specific cost-centers.

The review and analysis of cash forecasting andcash flow continued to contribute to record invest-ment income.

The Fiscal Management Division was again ableto reduce its staff by one employee through refine-ment of work procedures. Over a period of Wiyears, the staff has been reduced by 10 employees,resulting in substantial savings in salary costs tothe Comptroller's Office.

The Personnel Division gave additional emphasisto programs initiated in 1969, and developed newpersonnel policies in 1970 to achieve a more pro-gressive and comprehensive personnel managementprogram. The Cooperative Work-Study Program,designed to train and develop college students forfuture bank examiner positions, was expanded. Atthe end of 1970, the Office had 72 financial internsin the program including approximately 20 percentfrom minority groups. That is considered a realisticapproach in the continuing effort to achieve a moreeffective equal employment opportunity program.The merit promotion plan for non-examiner per-sonnel served to make employees more aware ofpromotion opportunities and permitted selectionsfrom among the best qualified. It also resulted in asubstantial increase in the number of vacanciesfilled by grade promotions from within the Office.

The Personnel Division played a key role in theOffice-wide training effort for bank examiners. Allfacets of examination and all levels and categoriesof National bank examiners were involved in thiseffort. (See sections on "Bank Examinations," "Fi-duciary Activities," and "International Banking.")

A new pay policy was issued in May 1970 whichestablished a more systematic and equitable basisfor assigning grade levels and determining pay forall employees. It provides that there shall be equalpay for substantially equal work, and that pay dis-tinctions will be in proportion to difference in re-

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sponsibility and performance. It also provides thatpay rates will be comparable with private enter-prise rates for the same levels of work.

As a result of a comprehensive study of the fieldexamination function, a Guide for DeterminingGrade Levels of National Bank Examiner Positionswas issued in December 1970. This included de-scriptions of the typical responsibilities of Nationalbank examiners. The basic objectives of the guidewere to better identify a career ladder for examin-ers, to provide a common understanding of gradelevels, to achieve pay equity, and, to encouragemore effective manpower utilization practices.

An Evaluation of Personnel Management reportwas received by the Comptroller in July 1970, fromthe Civil Service Commission. This was the resultof an inspection made by Commission representa-tives of the personnel operations of the Office ofthe Comptroller of the Currency. In ChairmanHampton's letter to Secretary Kennedy, he statedthat the "summary accomplishments in bringingmodern concepts of personnel management to theoperation of his office is indeed impressive."

Several revised personnel procedures were issuedto streamline the paperwork requirements and tominimize the efforts of managers in requesting per-sonnel actions. They included certain delegationsto regional administrators and the establishment ofa more systematic means for expediting personnelactions.

As a part of our continuing efforts to emphasizeyouth in meeting our organizational objectives, ayouth advisory panel was established in Washingtonon September 16, 1970. Initial goals were estab-lished, including an effort to achieve better com-munications between management and employees.A survey of total staffing revealed approximately65 percent of all employees are under 35 years ofage including a substantial percentage of those inexecutive positions.

In June 1970, all employees were notified oftheir rights under Executive Order 11491, LaborManagement Relations in the Federal Service. Theinitiation of that program included the establish-ment of a labor-management relations policy with-in the Office of the Comptroller. Other provisionsinvolved the recognition of the supervisory statusof commissioned bank examiners, the forms ofrecognition which will be accorded to labor organi-zations, and implementing instructions essential tothe new program.

During the calendar year 1970, a total of $76,251

was awarded to employees for their participation inthe incentive awards program, and $1,850, in thesuggestion program. In addition, a total of $2,136was granted to five individual employees represent-ing special achievement awards. High quality in-crease awards were approved for 215 employees inrecognition of their superior performance.

At the request of management, the PersonnelDivision developed appropriate materials to permitdivision chiefs and other key managers in Washing-ton to analyze their workload in terms of their cur-rent and future manpower needs. Organization andstaffing charts, questionnaires, and related materialswere coordinated and summarized in order to facili-tate minimum staffing for each organizational seg-ment. Proposals were also submitted to top man-agement for consideration in setting personnel ceil-ings for the Washington Office departments and di-visions, and such ceilings were established.

As in past years, many employees enrolled in avariety of courses to increase their knowledge andskill. For example, several of our managementlevel personnel participated in the Federal Execu-tive Institute Management seminars and HarvardGraduate School of Business management pro-grams.

A number of studies were conducted and pro-posals presented for management consideration atthe end of the year. Those included a comprehen-sive personnel management evaluation program tobe initiated in 1971. It also included proposedstatements of significant personnel management andtraining goals to be achieved during 1971. Thosegoals contained specific plans for accomplishmentand interim target dates.

In 1970, the Administrative Services Divisionunderwent a limited reorganization. Based onoperational experience and the results of an in-ternal audit, publication control functions wereassumed at the division level, and the Publicationsand Issuance Branch was eliminated as a branch.Both functions and their personnel were transferredto the Office of the Director. The division beganpublication of an employee newsletter and con-tinued its program of improving the appearance ofOffice publications.

Space management activity consisted of complet-ing the relocation of two regional offices, Philadel-phia and Portland, to more adequate quarters; theclosing or consolidating of two sub-regional offices;and the establishing of five new sub-regional offices.Several offices were relocated in the Washington

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headquarters, resulting in greater control, increasedefficiency, and better space utilization. Records dis-position schedules were approved for regionaloffices. Classification and disposal of remainingrecords, stored locally, were completed. The initialphase of microfilming vital records was largely com-pleted and the up-dating phase was initiated.

In the area of supply and procurement, the issu-ance of policy and procedural directives for bothWashington and the field resulted in a noticeableimprovement in requisitioning practices and in-ternal operations.

The Internal Audit Division extended its reviewof internal operations to include managementaudits relating to the activities of operational divi-sions; previously, the scope of activity had centeredprimarily on financial audits. During this periodthe division also initiated a program whereby man-agement, both in Washington and in the fieldoffices, were solicited for ideas on audit areas to beincluded in the annual audit plan. The responsewas stimulating and the annual audit plan wasadjusted to increase the extent of audit coverage offield activities.

In 1970, the Management Services Division pro-vided staff support in several areas. A more effec-tive management improvement program was estab-lished and expanded to include views and contribu-tions of the field offices. Initial results enhancedbetter communications within the office and pro-duced a refinement of procedures at the field level.

This past year saw a continued effort to improveand stimulate interest in the emergency prepared-ness program. The Comptroller's Office took part ina Treasury-wide alerting test which was extendedbeyond the regional offices to include, for the firsttime, sub-regional offices. Highlighting the pro-gram for 1970 was a visit, by Washington staffmembers who have emergency preparedness assign-ments, to the Treasury alternate relocation site.That visit provided a more realistic understandingof emergency duties and more insight into the totalprogram.

Data processing services continued to provide di-visions with timely, accurate information and, fur-ther, aided economists in various research projects,among them the recently published monograph,"Bank Trusts: Investments and Performance."


OFFICE OF THE COMPTROLLER OF THE CURRENCYChart of Organization

National AdvisoryCommittee on

Banking Policiesand Practices

Comptrollerof the

Currency

First DeputyComptroller

ChiefCounsel

DeputyChief Counsel

SpecialAssistant

(CongressionalAffairs)

Comptroller(Economics)

DeputyComptroller

(FDIC Affairs)

SpecialAssistant

(Public Affairs)

DeputyComptroller

AdministrativeAssistant to the

Comptroller

Comptroller

ChiefNational Bank

Examiner

__i L

LawDepartment

Dept. ofBanking &EconomicResearch

StatisticalDivision

Director,International

Division

DeputyComptrollerfor Trusts 1

AssistantChief National

Bank Examiners

Comptrollerfor Mergers

and Branches

DeputyAdministrative Asst.

(Personnel)

ChiefRepresentative

in Trusts

Director,Bank Organization

Division

SpecialAssistant

14 RegionalAdministrators of

National Banks

Regional AdvisoryCommittees

Deputy RegionalAdministrators

Regional Counsel

National BankExaminers —International

National BankExaminers

Deputy Director

Mergers andConsolidations

Branch

1 1 1New Bank

Branch

CapitalIncreaseBranch

BranchApplications

Branch

DeputyAdministrative Asst..(Fiscal Management)

DirectorAdministrative

ServicesDivision

DirectorManagement

ServicesDivision

DirectorInternal Audit

Division

I ADVISORS I I EXAMINING I ICORPORATE I ^•ADMINISTRATIVEBT


IX . Financial Operations of the Office of theComptroller of the Currency

During 1970, the Office of the Comptroller of theCurrency, as well as many other government agen-cies and private businesses, experienced rapidly ris-ing costs while at the same time sustaining a slowerrate of income growth. Consequently, various costcontrol measures were instituted to offset this con-dition and, I am pleased to report another success-ful year in our financial operations.

Total income for the year was $36.8 million, anincrease of 12.9 percent over 1969. This increase isprincipally due to the $3.4 million rise in assess-ment income, resulting from a full year under thehigher assessment rates effected in July 1969, and a$17.4 billion rise in National bank assets. Dis-regarding the assessment rate increase, the growthrate for assessment income is substantially lowerthan in previous years because of the decline in therate of growth in National bank assets. Nationalbank assets affecting 1970 assessment income in-creased only 5.88 percent, compared to an increaseof 12.61 percent the prior year.

Interest on investments continues to be a signifi-cant factor in the overall income picture. This in-come category shows a 33.6 percent rise, to $1.8million, representing almost 70 percent of the ex-cess of revenue over expenses for the year. Calen-dar year 1970 represents the third consecutive yearthat the annual percentage increase has exceeded25 percent. This increase reflects the record highinterest rates experienced during the year and thecontinuing effort to keep funds fully invested.

Revenue from trust examinations for the year in-creased $305,000, to $2.0 million, primarily due to afull year under the revised rates effective in mid-1969. Branch investigation income was up by$71,000 reflecting a continued high rate of activityin this area.

Income from new charter applications increased

$34,000, while merger and consolidation fees de-creased by $59,000. All other income categories re-mained fairly constant with 1969 levels.

Total expenses amounted to $34.2 million com-pared to $28.8 million in the previous year, an in-crease of $5.4 million. This amounts to an 18.8percent increase, 5.9 percent greater than the in-crease in revenue. This significant increase in ex-penses occurred mainly during the last six monthsof the calendar year, and generally reflects thenecessary increase in total employment. In orderto combat these rapidly rising costs, which were alsobeing experienced by other government agenciesand private businesses, it was necessary to institutereduced personnel ceilings and certain other costcontrol measures to maintain a proper balance be-tween income and expense.

Salaries, personnel benefits, and travel expensesamounted to $32.2 million, representing 94.2 per-cent of the total expenses for the year, and a rise of19.2 percent over the previous year. Significant fac-tors causing this rise were: (1) the 6 percent con-gressional pay raise effective January 1, 1970, (2) an8 percent increase in the total number of employ-ees, and (3) a full year under higher per diem andother travel costs.

The remaining expenses totaled $2.0 million, anincrease of $227,000 which represented higher costsfor education, rent, and communications. These ex-penses also include a contribution of $50,000 toprovide financial assistance to the Presidential Com-mission on Financial Structure and Regulation.

The equity account is in reality a reserve for con-tingencies. Transfers of $2.6 million increased theequity to $19.9 million at year-end. This representsa 6 % months' reserve for operating expenses,based on the level of expenses over the last sixmonths of 1970.

25


TABLE 11

OFFICE OF THE COMPTROLLER OF THE CURRENCY

BALANCE SHEET

December 31

Assets 1970 1969

Current assets:Cash $67,875 $196,540Obligations of U.S. Government, at cost (approximates market value) 7,243,415 8,419,153Accounts receivable 280,439 77,015Accrued interest 455,070 321,764Travel advances 408,152 375,598Prepaid expenses and other assets 70,036 53,494

Total current assets 8,524,987 9,443,564

Obligations of U.S. Government, at cost (approximates market value) 17,284,418 13,115,282

Fixed assets, at cost:Furniture and fixtures 872,788 779,966Office machinery and equipment 398,784 389,679

1,271,572 1,169,645Less accumulated depreciation 581,368 481,757

Total assets $26,499,609 $23,246,734

Liabilities and Comptroller's Equity

Current liabilities:Accounts payable and other accruals $211,623 $201,387Salary deductions and withholdings 71,615 78,139Accrued travel and salary 1,724,656 1,393,328

Total current liabilities 2,007,894 1,672,854Accumulated annual leave 1,840,243 1,577,011Closed receivership funds 2,706,683 2,708,387

Total liabilities 6,554,820 5,958,252Comptroller's equity 19,944,789 17,288,482

Total liabilities and Comptroller's equity $26,499,609 $23,246,734

26


TABLE 12


STATEMENT OF REVENUE, EXPENSES AND COMPTROLLER'S EQUITY

Year ended December 31

1970 1969

Revenue:Semi-annual assessments $31,336,670 $27,939,249Examinations and investigations 2,927,733 2,525,087Examination reports sold 500,520 497,560Revenue from investments 1,836,908 1,374,760Other 238,041 288,224

36,839,872 32,624,880

Expenses:Salary 24,781,477 21,133,705Retirement and other contributions 1,949,486 1,568,850Per diem 3,604,529 2,838,279Travel 1,868,782 1,470,600Rent and maintenance 509,129 366,699Supplies 89,347 69,551Printing, reproduction, and subscriptions 194,533 333,246Depreciation 125,280 115,328Remodeling 68,963 94,375Office machine repairs and rentals 96,939 90,246Communications 369,040 306,600Moving and shipping 98,136 123,334Employees education and training 243,631 135,007Other 184,293 117,824

34,183,565 28,763,644

Excess revenue over expenses 2,656,307 3,861,236

Comptroller's equity at beginning of year 17,288,482 13,427,246

Comptroller's equity at end of year $19,944,789 $17,288,482

27


TABLE 13


STATEMENT OF SOURCE AND APPLICATION OF FUNDS

Year ended December 31

1970 1969

Funds were provided by:Excess revenue over expenses $2,656,307 $3,861,236Add charges not requiring current outlay of funds:

Depreciation 125,280 115,328Net increase in accumulated annual leave 263,232 218,583Net loss on sales of fixed assets 10,148 12,679

Total funds provided 3,054,967 4,207,826

Funds were applied to:Net increase in investment in long term U.S. Government obligations 4,169,136 727,159Purchases of furniture and fixtures 100,039 92,483Purchases of machinery and equipment 37,705 25,639Changes in closed receivership funds 1,704 (121)

Total funds applied 4,308,584 845,160

Increase (decrease) in working capital (1,253,617) 3,362,666

Current assets 8,524,987 9,443,564

Current liabilities - 2,007,894 1,672,854

Working capital at end of year 6,517,093 7,770,710

Working capital at beginning of year 7,770,710 - 4,408,044

Working capital increase (decrease) $(1,253,617) $3,362,666

OPINION OF INDEPENDENT ACCOUNTANT

To the Comptroller of the CurrencyOffice of the Comptroller of the Currency

In our opinion, the accompanying balance sheets, the related statementsof revenue, expenses and Comptroller's equity and the statements of source andapplication of funds present fairly the financial position of the Office of theComptroller of the Currency at December 31, 1970 and 1969, the results of itsoperations and the supplementary information on funds for the years thenended, in conformity with generally accepted accounting principles consistentlyapplied. Our examinations of these statements were made in accordance withgenerally accepted auditing standards and accordingly included such tests ofthe accounting records and such other auditing procedures as we considerednecessary in the circumstances.

PRICE WATERHOUSE & CO.

WASHINGTON, D.C.January 29, 1971

28


APPENDIX A

Merger Decisions, 1970


Merger* Decisions, 1970

/. Mergers consumated, involving two or more operating banks'

PageJan. 1, 1970:

The Delaware County National Bank, Chester, Pa.National Bank of Chester County and Trust

Company, West Chester, Pa.Consolidation 34

Jan. 2, 1970:National Community Bank of Rutherford, Ruther-

ford, N.J.The Bank of Sussex County, Franklin, N.J.Merger 36

Jan. 9, 1970:New Jersey Bank (N.A.), Clifton, N.J.Peoples National Bank of Sussex County, Sparta,

N.J.Merger 37

Jan. 9, 1970:Northwestern National Bank of Sioux Falls, Sioux

Falls, S. Dak.Community State Bank of Lake Preston, Lake

Preston, S. Dak.Merger 40

Jan. 19, 1970:The Citizens National Bank of Bryan, Bryan, OhioThe West Unity Banking Company, West Unity,

OhioMerger 41

Jan. 23, 1970:Wachovia Bank and Trust Company, N.A., Win-

ston-Salem, N.C.Citizens Bank & Trust Company of Andrews,

Andrews, N.C.Merger 42

Jan. 30, 1970:United States National Bank, San Diego, Calif.Southland National Bank, Yucaipa, Calif.Purchase 45

Feb. 20, 1970:North Carolina National Bank, Charlotte, N.C.Marion Bank and Trust Company, Marion, N.C.Merger 45

Feb. 27, 1970:County National Bank, Middletown, N.Y.Rockland National Bank, Suffern, N.Y.Merger 47

Feb. 27, 1970:New Jersey Bank ( N J \ . ) , Clifton, N.J.Jersey State Bank, River Edge, N.J.Merger 51

Feb. 28, 1970:First National Bank, Bowling Green, OhioHardy Banking Company, North Baltimore, OhioMerger 53

Mar. 13, 1970:Central Penn National Bank, Bala-Cynwyd, Pa.Community Bank & Trust Company, Paoli, Pa.Merger 54

•Includes mergers, consolidations, and purchase and saletransactions where the emerging bank is a National bank.Decisions are arranged chronologically by effective date.

PageMar. 13, 1970:

Virginia National Bank, Norfolk, Va.The First National Bank of Harrisonburg, Har-

risonburg, Va.Merger 56

Mar. 18, 1970:First National Bank in Mount Clemens, Mount

Clemens, Mich.The Armada State Bank, Armada, Mich.Merger 58

Mar. 31, 1970:First National Bank in Mansfield, Mansfield, Pa.The Citizens National Bank, Blossburg, Pa.Merger 59

Apr. 10, 1970:Wells Fargo Bank, N.A., San Francisco, Calif.Los Padres National Bank, Santa Maria, Calif.Merger 60

Apr. 11, 1970:First National Bank in Mansfield, Mansfield, La.Bank of Grand Cane, Grand Cane, La.Purchase 62

Apr. 17, 1970:The Connecticut National Bank, Bridgeport, Conn.Atlantic National Bank, Stamford, Conn.Merger 63

Apr. 30, 1970:First National Bank of Lincolnton, Lincolnton,

N.C.The First National Bank of Mooresville, Moores-

ville, N.C.Merger 65

Apr. 30, 1970:Old National Bank of Washington, Spokane, Wash.Commercial Bank of Washington, Twisp, Wash.Merger 66

Apr. 30, 1970:South Jersey National Bank, Camden, N.J.Union National Bank and Trust Company, Mount

Holly, N.J.Merger 68

May 1, 1970:The First National Bank of Maryland, Baltimore,

Md.First National Bank of Harford County, Bel Air,Merger 70

Md.May 11, 1970:

First Trenton National Bank, Trenton, N.J.New Jersey National Bank and Trust Company,

Neptune, N.J.Merger 70

May 18, 1970:The Cassia National Bank of Burley, Burley, IdahoLava Hot Springs State Bank, Lava Hot Springs,

IdahoMerger 73

May 22, 1970:Peoples National Bank of New Jersey, Westmont,

Haddon Township, N.J.


PageThe Vineland National Bank and Trust Company,

Vineland, N.J.Merger 74

May 29, 1970:Zions First National Bank, Salt Lake City, UtahBank of Commerce, Magna, UtahPurchase 76

June 1, 1970:Virginia National Bank, Norfolk, Va.The Merchants and Farmers Bank, Smithfield, Va.Merger 77

June 2, 1970:The First National Bank of Houlton, Houlton,

MaineThe First National Bank of Fort Fairfield, Fort

Fairfield, MaineMerger 80

June 11, 1970:Southern California First National Bank, San

Diego, Calif.Gateway National Bank, El Segundo, Calif.Merger 82

June 30, 1970:Bristol County Trust Company, Taunton, Mass.The First National Bank of Attleboro, Attleboro,

Mass.Merger 83

June 30, 1970:First National Bank of South Jersey, Egg Harbor

Township, N.J.The First National Bank of Williamstown, Wil-

liamstown, N.J.Merger 85

June 30, 1970:First National Bank of Westmoreland, Greens-

burg, Pa.The Peoples National Bank of Tarentum, Taren-

tum, Pa.Consolidation 86

June 30, 1970:State Bank of Whiting, Whiting, Ind.The First National Bank of Cedar Lake, Cedar

Lake, Ind.Consolidation 88

June 30, 1970:The Merchants National Bank of Allentown, Al-

len town, Pa.The Fogelsville National Bank, Fogelsville, Pa.Merger 89

June 30, 1970:Zions First National Bank, Salt Lake City, UtahBank of St. George, St. George, UtahPurchase 91

July 1, 1970:The First National Bank of Ebensburg, Ebens-

burg, Pa.The Peoples Bank of Clymer, Clymer, Pa.Merger 91

July 1, 1970:The Idaho First National Bank, Boise, IdahoFidelity National Bank of Twin Falls, Twin Falls,

IdahoMerger 93

July 6, 1970:National Bank of North America, New York, N.Y.Trade Bank and Trust Company, New York, N.Y.Consolidation 93

July 6, 1970:Peoples National Bank of Washington, Seattle,

Wash.Langley State Bank, Langley, Wash.Purchase 95

July 6, 1970:University National Bank, Rockville, Md.Montgomery Banking and Trust Company, Rock-

ville, Md.Merger 97

PageJuly 9, 1970:

The Merchants National Bank of Burlington, Bur-lington, Vt.

Barre Trust Company, Barre, Vt.Merger 98

July 10, 1970:Trust Company National Bank, Morristown, N.J.Montclair National Bank and Trust Company,

Montclair, N.J.Consolidation 100

July 17, 1970:First County National Bank and Trust Company,

Woodbury, Woodbury, N.J.The First National Bank and Trust Company of

Paulsboro, Paulsboro, N.J.Pitman National Bank and Trust Company, Pit-

man, N.J.Merger 102

July 17, 1970:The Farmers National Bank of Salem, Salem, OhioCitizens Savings Bank, Columbiana, OhioMerger 104

July 27, 1970:First National Bank of Eastern North Carolina,

Jacksonville, N.C.The State Bank of Wingate, Wingate, N.C.Merger 106

July 31, 1970:First & Merchants National Bank, Richmond, Va.Suburban National Bank of Virginia, (McLean

P.O.), Fairfax County, Va.Merger 107

July 31, 1970:Lincoln National Bank and Trust Company of

Central New York, Syracuse, N.Y.The National Exchange Bank of Boonville, Boon-

ville, N.Y.Merger 109

July 31, 1970:Security Pacific National Bank, Los Angeles, Calif.Bank of Sacramento, Sacramento, Calif.Merger I l l

July 31, 1970:The Commercial National Bank of Kansas City,

Kansas City, Kans.Exchange State Bank of Kansas City, Kansas City,

Kans.Merger 113

Aug. 1, 1970:Southern National Bank of North Carolina, Lum-

berton, N.C.Bank of Charlotte, Charlotte, N.C.Merger 115

Aug. 7, 1970:National Bank of Agriculture, Delano, Calif.The First National Bank of Caruthers, Caruthers,

Calif.Consolidation 116

Aug. 14, 1970:Maine National Bank, Portland, MaineThe First National Bank of Pittsfield, Pittsfield,

MaineMerger 117

Aug. 14, 1970:The Indian Head National Bank of Nashua,

Nashua, N.H.The Wilton National Bank, Wilton, N.H.Merger 118

Aug. 17, 1970:National Bank of Washington, Tacoma, Wash.The Pacific National Bank of Seattle, Seattle,

Wash.Consolidation 120

Aug. 28, 1970:North Carolina National Bank, Charlotte, N.C.

31


PageThe State Commercial Bank, Thomasville, N.C.Merger 124

Aug. 28, 1970:The First National Bank of Allentown, Allentown,

Pa.Saucon Valley Trust Company, Hellerton, Pa.Merger 126

Aug. 31, 1970:Easton National Bank and Trust Company, Easton,

Pa.The Citizens Bank of Wind Gap, Wind Gap, Pa.Merger 127

Aug. 31, 1970:National Bank and Trust Company, Charlottes-

ville, Va.The National Bank of Orange, Orange, Va.Merger 129

Sept. 1, 1970:Midland National Bank, Milwaukee, Wis.The Home Bank, Milwaukee, Wis.Merger 131

Sept. 9, 1970:Carlton National Bank, Carlton, Minn.The First National Bank of Carlton, Carlton,

Minn.Purchase t 132

Sept. 10, 1970:National Bank of South Dakota, Sioux Falls, S.

Dak.Security Bank, Madison, S. Dak.Merger 132

Sept. 25, 1970:Old National Bank of Washington, Spokane, Wash.North West Bank, Seattle, Wash.Merger 133

Sept. 28, 1970:The Park National Bank of Newark, Newark, OhioThe Peoples State Bank, Granville, OhioPurchase 135

Sept. 30, 1970:Marine National Bank, Erie, Pa.The First National Bank of Edinboro, Edinboro,

Pa.Merger 136

Sept. 30, 1970:Old National Bank of Washington, Spokane, Wash.First National Bank in Tonasket, Tonasket, Wash.Purchase 137

Sept. 30, 1970:Zions First National Bank, Salt Lake City, UtahBountiful State Bank, Bountiful, UtahPurchase 138

Oct. 13, 1970:National Bank of North America, New York, N.Y.First National Bank in Yonkers, Yonkers, N.Y.Consolidation 139

Oct. 30, 1970:First National Bank of South Jersey, Egg Harbor

Township, N.J.The First National Bank of Pedricktown, Ped-

ricktown, N.J.Merger 141

PageOct. 30, 1970:

Hartford National Bank and Trust Company,Hartford, Conn.

General Bank and Trust Company, New Haven,Conn.

Merger 142Oct. 30, 1970:

The Warren National Bank, Warren, Pa.The Gold Standard National Bank of Marien-

ville, Marienville, Pa.Purchase 144

Nov. 6, 1970:The Citizens National Bank, Bryan, OhioThe Pioneer Banking Company, Pioneer, OhioMerger 145

Nov. 6, 1970:Wells Fargo Bank, N.A., San Francisco, Calif.The First National Bank of Holtville, Holtville,

Calif.Merger 147

Nov. 14, 1970:First Union National Bank of North Carolina,

Charlotte, N.C.The Bank of French Broad, Marshall, N.C.Merger 148

Nov. 23, 1970:Virginia National Bank, Norfolk, Va.Carroll County Bank, Hillsville, Va.Merger 149

Dec. 1, 1970:The Riddell National Bank of Brazil, Brazil, Ind.The First National Bank of Center Point, Center

Point, Ind.Merger 151

Dec. 4, 1970:First National State Bank of New Jersey, Newark,

N.J.Orange Valley Bank, Orange, N.J.Merger 152

Dec. 7, 1970:National Bank & Trust Company of Central Penn-

sylvania, York, Pa.The Reading Trust Company, Reading, Pa.Lancaster County Farmers National Bank, Lan-

caster, Pa.Consolidation 154

Dec. 31, 1970:First Citizens National Bank, Mansfield, Pa.Grange National Bank of Potter County, Ulysses,

Pa.Merger 154

Dec. 31, 1970:First National Bank of Central Jersey, Somerville,

N.J.The First National Bank of Roselle, Roselle, N.J.Consolidation 156

Dec. 31, 1970:The Littleton National Bank, Littleton, N.H.Lisbon National Bank, Lisbon, N.H.Merger 157

/ / . Mergers consummated pursuant to corporate reorganization,involving a single operating bank*

PageJan. 3, 1970:

Coshocton National Bank, Coshocton, OhioNational Bank of Coshocton, Coshocton, OhioMerger 159

Jan. 3, 1970:First National Bank of Cambridge, Cambridge,

Ohio

•Includes mergers and consolidations where the emerg-ing bank is a National bank.

PageThe Guernsey County National Bank, Cambridge,

OhioMerger 159

Jan. 14, 1970:First National Bank of New Jersey, Newark, N.J.National State Bank of New Jersey, Newark, N.J.Merger 160

Feb. 24, 1970:Gallatin National Bank, Uniontown, Pa.


PageBlythe National Bank, Uniontown, Pa.Merger 161

Feb. 27, 1970:Columbus National Bank of Rhode Island, Provi-

dence, R.I.Rhodes National Bank, Providence, R.I.Merger 161

Mar. 25, 1970:Cumberland County National Bank and Trust

Company, New Cumberland, Pa.CCNB National Bank, New Cumberland, Pa.Merger 162

Apr. 30, 1970:The Citizens National Bank of Chillicothe, Chil-

licothe, Mo.Chillicothe National Bank, Chillicothe, Mo.Merger 163

Apr. 30, 1970:The Fort Worth National Bank, Fort Worth, Tex.Bank of Fort Worth, N.A., Fort Worth, Tex.Merger 163

May 1, 1970:The First National Bank of St. Joseph, St. Joseph,

Mo.First National Bank of Buchanan County, St.

Joseph, Mo.Merger 164

June 12, 1970:National Newark & Essex Bank, Newark, N.J.Essex Bank, N.A., Newark, N.J.Merger 165

June 12, 1970:Raritan Valley National Bank, Edison Township,

N.J.Second Raritan Valley National Bank, Edison

Township, N.J.Merger 165

June 12, 1970:The Sussex and Merchants National Bank of New-

ton, Newton, N.J.The Second Sussex and Merchants National Bank

of Newton, Newton, N.J.Merger 166

June 18, 1970:New England Merchants National Bank of Boston,

Boston, Mass.New England Merchants Bank (N.A.), Boston,

Mass.Merger 167

July 1, 1970:First National Bank of Warren, Warren, Mich.Warren National Bank, Warren, Mich.Merger 168

July 28, 1970:The National Bank of Auburn, Auburn, N.Y.

PageBank of Auburn, N.A., Auburn, N.Y.Merger 168

August. 31, 1970:The Peoples National Bank and Trust Company,

Dover, OhioThe F.B.G. National Bank of Dover, Dover, OhioMerger 169

Sept. 30, 1970:Peoples National Bank of Monmouth County,

Hazlet Township, N.J.Second Peoples National Bank of Monmouth

County, Hazlet Township, N.J.Merger 170

Sept. 30, 1970:The Cumberland National Bank of Bridgeton,

Bridgeton, N.J.Cumberland County National Bank, Bridgeton,

N.J.Merger 171

Sept. 30, 1970:The Third National Bank & Trust Company of

Camden, Camden, N.J.The Fourth National Bank & Trust Company of

Camden, Camden, N.J.Merger 171

Dec. 10, 1970:Bank of the Southwest National Association, Hous-

ton, Tex.Southwest Bank, N.A., Houston, Tex.Merger 172

Dec. 16, 1970:The First National Bank at East Palestine, East

Palestine, OhioEast Palestine National Bank, East Palestine, OhioMerger 173

Dec. 21, 1970:City National Bank, Hackensack, N.J.First National State Bank of North Jersey, Hack-

ensack, N.J.Merger 174

Dec. 21, 1970:First National Bank of Spring Lake, Spring Lake,

N.J.First National State Bank of Spring Lake, Spring

Lake, N.J.Merger 174

Dec. 21, 1970:The Edison Bank, South Plainfield, N.J.The Edison Bank, N.A., South Plainfield, N.J.Merger 175

Dec. 21, 1970:The Warren County National Bank, Washington,

N.J.The Second Warren County National Bank, Wash-

ington, N.J.Merger 176

///. Additional Approvals

PageA. Approved, but in litigationOct. 9, 1970:

Catamount National Bank, North Bennington,Vt.

The County National Bank of Bennington, Ben-nington, Vt.

Consolidation 177

PageB. Approved, but consummation deferred due to re-

lated litigationFeb. 2, 1970:

The Peoples National Bank of Manassas, Manas-sas, Va.

Manassas Bank, N.A., Manassas, Va.Merger 179

NOTE: The 1967 Annual Report carried the Comptroller's decision approving the proposed merger of the Phillipsburg Na-tional Bank and Trust Company and the Second National Bank of Phillipsburg, both of Phillipsburg, N.J., under the head-ing "Approved, but in litigation." Plans for the merger were abandoned after the Supreme Court remanded the case to theDistrict Court for further findings in 1970.

The 1969 Annual Report carried the Comptroller's decision approving the proposed merger of The First National Bankof Sunbury, Sunbury, Pa., and Snyder County Trust Company, Selinsgrove, Pa., under the "Approved, but in litigation" head-ing. After the filing of an action against the merger by the Antitrust Division in 1969, the banks abandoned their mergerplans on April 22, 1970.


7. Mergers consummated, involving two or more operating banks

THE DELAWARE COUNTY NATIONAL BANK, CHESTER, PA., AND NATIONAL BANK OF CHESTER COUNTY AND TRUST COMPANY,WEST CHESTER, PA.

Name of bank and type of transaction

National Bank of Chester County and Trust Company, West Chester, Pa. (552),with. . .and The Delaware County National Bank, Chester, Pa. (355), which hadconsolidated Jan. 1, 1970, under charter of the latter bank (355) and title"Southeast National Bank of Pennsylvania." The consolidated bank at date ofconsolidation had

Total assets

$103,691,564161,059,614

264,751,178

Banking offices

Inoperation

812

To beoperated

20

COMPTROLLER S DECISION

On August 12, 1969, The Delaware County Na-tional Bank, Chester, Pa., and National Bank ofChester County and Trust Company, West Ches-ter, Pa., applied to the Comptroller of the Cur-rency for permission to consolidate under thecharter of the former and with the title "SoutheastNational Bank of Pennsylvania."

The Delaware County National Bank, thecharter bank, was organized in 1814 as the Bank ofDelaware County. In 1864 it became a Nationalbank and adopted its present name. This bank op-erates 11 offices and has total resources of $161 mil-lion.

The charter bank is headquartered in the cityof Chester and serves the southern portion of Dela-ware County. This county, which has an estimatedpopulation of 553,000, is one of the three countiesbordering on Philadelphia County. DelawareCounty is considerably smaller in area than theother two, Bucks and Montgomery. Its farthestreach extends only 20 miles from the city of Phila-delphia, and it is the most urbanized of the threecounties. Its principal city, Chester, is located be-tween Wilmington, 12 miles to the south, andPhiladelphia, 6 miles to the north.

Delaware County is mostly urban and industrial.In 1960, 96 percent of the county's population wascharacterized by the Census Bureau as urban, withthe rest rural. Of the total countywide payroll in1967, $800 million, or 57 percent, was derived fromemployment in manufacturing, 17 percent fromwholesale and retail trading, and 11 percent fromother types of services. Agricultural employmentcontributed not more than 0.2 percent.

The charter bank operates all of its 11 branchesin Delaware County. Two of these branches are ac-tually extensions of the main office as they are lo-

cated across the street from it. Three brancheshave been established within the last four years inan effort to keep pace with branching inroadsbeing made by out-of-county banks. Additionalbranching at that pace can only be undertaken bysignificantly increasing the pressure on the bank'searnings and capital position.

The National Bank of Chester County, the con-solidating bank, was first organized as the Bank ofChester County in 1814. In 1864 it became a Na-tional bank and adopted its present name.

The consolidating bank, with resources of $92million, is headquartered in West Chester, Pa., thecounty seat of Chester County. This bank serves amajor portion of the county through a network ofnine branch offices. Chester County and the sur-rounding area were, until a dozen years ago, pri-marily dependent upon an agricultural economy.However, the population movement from Philadel-phia, approximately 27 miles east, has resulted in aheavy demand for housing and the conversion offarmland into residential communities.

Eight of the nine offices operated by the consoli-dating bank are located in Chester County. Thebranch located outside of the county is just acrossthe line in Delaware County. It is estimated that95 percent of the consolidating bank's total depos-its are derived from Chester County.

The charter bank faces strong competition in itsservice area. Under Pennsylvania law, a bank maybranch within the county of its head office, andcounties contiguous thereto. As Delaware County,the service area of the charter bank, is contiguousto Philadelphia, the large metropolitan banks arepermitted to branch into Delaware County. Thereare presently six Philadelphia banks conductingbranch operations in Delaware County. All ofthese competing banks are larger in overall terms

34


than the charter bank. Two of the six have moreoffices in Delaware County than does the charterbank.

Three Montgomery County banks also conductbranch operations in Delaware County. Two ofthese are former Philadelphia banks which havemoved their main offices, and both are substan-tially larger than the charter bank. At present, thecharter bank, which was once the county's leadingbank, is the third largest bank in terms of totaloffices, and ninth largest in total resources.

The consolidating bank also faces strong compe-tition in its market area and anticipates increasingcompetitive pressure in the near future. WhileChester County is not contiguous to Philadelphia,and banks headquartered in Philadelphia are notpermitted to branch into Chester County, threePhiladelphia banks have moved their head officesto Montgomery County, and two of these have fol-lowed with branches into Chester County. It is an-ticipated that other Philadelphia banks will takethis route into Chester County. As these city banksexpand into Chester County by merger, or other-wise, the consolidating bank will be under increas-ing pressure to change its circumstances or lose cus-tomers.

At present there is little evidence of competitionbetween the charter bank and consolidating bank.Their head offices are approximately 17 milesapart, and all but one of the offices of each of thebanks is at least 10 miles from the office of theother. The one exception is the office of the consol-idating bank which is in Delaware County, 1 milefrom the Brandywine office of the charter bank.This office of the applicant accounts for only 0.6percent of its total deposits, and the office of theconsolidating bank in Delaware County, which hasbeen in existence for 10 years, accounts for 4.5 per-cent of its deposits.

Consummation of the proposed consolidationwill make available to all customers at ChesterCounty, the services presently available at Dela-ware County National Bank. Consummation of theconsolidation of these two banks will insure a re-sponsiveness to the needs of individual customersin the resulting service area that is not alwaysprovided by the larger Philadelphia-based banks. It

will ensure continued local control of a largerbank designed to serve local needs.

Applying the statutory criteria, it is concludedthat the proposed consolidation is in the public in-terest and the application is, therefore, approved.

OCTOBER 24, 1969.

SUMMARY OF REPORT BY ATTORNEY GENERAL

The closest offices of the merging banks are ap-proximately 1 mile apart, near Painters Crossroads,in Delaware County. While one of the largestbanks in the Philadelphia area has approval to lo-cate a branch in this immediate area, it seems clearthat the proposed merger would eliminate someexisting competition between the merging banks inthis localized market. Substantial distances and nu-merous offices of other commercial banks, includ-ing offices of large Philadelphia-based banks, sepa-rate the remainder of the merging banks' offices.

Both of the merging banks face substantialcompetition from very large banks which operateoffices throughout the Greater Philadelphia Area.

Under Pennsylvania law, both merging bankscould be permitted to branch de novo into theservice areas of one another. Both appear to pos-sess the resources necessary to open new offices inattractive areas.

DCNB is the ninth largest of 11 commercialbanks operating offices in Delaware County. As theonly locally headquartered bank, however, it holdsapproximately 21 percent of the IPC demand de-posits located therein. Delaware County is adjacentto Philadelphia and Montgomery counties, a factwhich permits the operation of branch offices inDelaware County by all of the very large banksheadquartered in and around Philadelphia. Mostof these large banks already enjoy substantial andgrowing shares of the Delaware County market.While NBC's entry into Delaware County throughmerger with DCNB would result in its affiliationwith a bank with a leading share of the DelawareCounty market, the presence of existing and in-creased competition from a substantial number oflarge Philadelphia banks indicates that the pro-posed merger would be unlikely to have a substan-tially adverse effect on potential competition inDelaware County.

35


NATIONAL COMMUNITY BANK OF RUTHERFORD, RUTHERFORD, NJ. , AND THE BANK OF SUSSEX COUNTY, FRANKLIN, N J .


The Bank of Sussex County, Franklin, N.J., withand National Community Bank of Rutherford, Rutherford,hadmerged Jan. 2, 1970, under charter and title of the lattermerged bank at date of merger had. .

NJ. (5005), which

bank (5005). The

Total

S55,

374,

430,

assets

387,215

309,033

173,045

Banking offices

Inoperation

6

23

To beoperated

29

COMPTROLLER'S DECISION

On August 11, 1969, the National CommunityBank of Rutherford, Rutherford, N. J., and TheBank of Sussex County, Franklin, N.J., applied tothe Comptroller of the Currency for permission tomerge under the charter and with the title of theformer.

National Community Bank of Rutherford, thecharter bank, was organized as a National bank in1895. This bank has total assets of $357 million,and currently operates 21 offices throughout Ber-gen County.

Bergen County is located in the northeasterncorner of New Jersey and is bordered on the northby New York State, on the east by the HudsonRiver, and on the south and west by Passaic, Essex,and Hudson counties. The population of thecounty was 913,520 in 1968, a growth of 17.1 per-cent over the 1960 figure. Because of its proximityto New York City, 45 percent of its wage earnerscommute there daily. The county's economy is welldiversified with numerous sizeable industrial,wholesale, and retail centers providing a variedbase. The continuing influx of commerce and in-dustry assures a favorable economic outlook.

The Bank of Sussex County, the merging bank,has total assets of $51 million, and currently oper-ates six banking offices scattered throughout SussexCounty. The merging bank was organized in 1919as the Sussex County Trust Company, and operatedas such until June 1963 when it merged with TheFarmers National Bank, Sussex, N. J., and assumedits present title. Although the last examination ofthe merging bank indicates satisfactory condition,growth of capital funds has not kept pace with thesteady increases in deposits resulting from therapid economic growth of the county. Also, provi-sions for the succession of senior management per-sonnel, some of whom have attained retirementage, have not been adequate.

Sussex County, located in the northwestern cor-ner of the State, has an estimated population of

68,120, with an influx of summer residents of be-tween 130,000 and 200,000, most of whom are at-tracted by the numerous lakes and resorts in thearea. There are presently no major industries inthe county. Approximately one-third of the area isfarm land. An estimated 40 percent of the workingpopulation travels outside the county for employ-ment. Future industrial development can be ex-pected as a result of two Federal conservation proj-ects, currently under construction along theDelaware River, which will provide an economicalsource of electrical energy and extensive recrea-tional facilities.

There is virtually no competition between themerging banks. The participants' head offices arelocated approximately 40 miles apart. The charterbank's Oakland office is 28 miles from the closestoffice of the merging bank. Between those twooffices are many offices of major competing banks.The proposed merger would not tend to reducecompetition.

Consummation of the proposed merger willserve the convenience and needs of Sussex County.The economic growth of this county has resultedin increased demands upon local banks to provideadequate credit and specialized services. The Bankof Sussex County has not been able to keep pacewith those demands. Through this merger, thecharter bank will able to extend its broad rangeof specialized services into the Sussex County area.Consummation of this merger will not only solve amanagement succession problem of the mergingbank, but it will also enable the resulting bank tocompete more effectively with the large banks inthe area.

Applying the statutory criteria to the proposedmerger, we conclude that it is in the public inter-est and the application is, therefore, approved.

NOVEMBER 21, 1969.


The closest offices of the merging banks are ap-

36


proximately 28 miles apart. Many offices of com-peting banks, including some of the largest banksin northern New Jersey, are located in the interven-ing area. Therefore it would appear that the pro-posed merger would not eliminate any substantialamount of existing competition between the merg-ing banks.

Recent legislation in New Jersey has greatlybroadened the sphere of permissible branch officeoperation for commercial banks, which may nowoperate offices anywhere in the newly created bank-ing district in which they are located. However,this legislation retains community-wide home officeprotection against de novo branching and providesbranch office protection in communities of lessthan 7,500 population. The merging banks areboth located in the First Banking District; there-fore the proposed merger would permanently elim-inate any possibility of future competition betweenthem in areas presently served by either, or inother areas of the district.

National Community clearly has the capabilityto open de novo offices wherever legally permissi-ble and financially attractive. However, while Sus-sex County has a bright economic future, presentopportunities for the establishment of de novobranches within the county are somewhat limitedby New Jersey's home and branch office protectionlaws.

The above-mentioned legislation has inducedsubstantial market extension activity by many ofthe State's larger banks, both through de novobranching and through merger. Major merger ac-tivity by the largest banks in a district could resultin undue domination of commercial banking inthe district by a few very large banking institu-tions. We therefore consider it important from acompetitive standpoint that the larger banks in agiven banking district enter new market areasthrough de novo branching, or in the alternativethrough merger with a small bank in the localarea.

In this manner, leading local banks may be pre-served to offer effective competition to new largeentrants in the local markets. Such banks are alsosources of potential competition, on a district-widebasis, to the large district banks, through affiliationwith one another in new banking institutions, in-cluding bank holding companies.

Through acquisition of Sussex Bank, NationalCommunity, one of the larger banks in the FirstDistrict will immediately acquire about 34 percentof total Sussex County commercial bank deposits,eliminating the leading local bank, and the onemost capable of offering competition to it should itenter Sussex County through merger with asmaller bank. We conclude that the proposedmerger would have an adverse effect on competi-tion.

NEW JERSEY BANK (N.A.), CLIFTON, N.J., AND PEOPLES NATIONAL BANK OF SUSSEX COUNTY, SPARTA, NJ .


Peoples National Bank of Sussex County, Sparta, N.J. (15375), withNew Jersey Bank (National Association), Clifton, NJ. (15709), which hadmerged Jan. 9, 1970, under charter and title of the latter bank (15709). Themerged bank at date of merger had

Total assets

$8,599,317506,883,752

515,199,963

Banking offices

Inoperation

221

To beoperated

23


On September 4, 1969, Peoples National Bank ofSussex County, Sparta, N. J., and New Jersey Bank(N. A.), Clifton, N. J., applied to the Office of theComptroller of the Currency for permission tomerge, under the charter and with the title of thelatter.

New Jersey Bank (N. A.), with IPC deposits of

$370.5 million, was originally chartered in 1869,and currently operates 19 branch offices, all in thesouthern portion of Passaic County. The charterbank is a well-managed and progressive institutionoffering a full range of banking services to itswidely diversified customers.

Passaic County, located in the northeastern sec-tion of New Jersey, contains 16 municipalities

37


with an estimated population of 464,000. Thethree most populated municipalities in the countyare Paterson, Clifton, and Passaic, which togethercomprise the southern end of the county and con-tain an aggregate population of 294,000. As a re-sult of Passaic County's proximity to New YorkCity, it has been able to attract numerous manu-facturing, wholesaling, and retailing facilities. Thefavorable commuting situation existing betweenPassaic County and the major commercial centersof New York and northern New Jersey, coupledwith a generally favorable tax situation, has causedhousing in the county to become extremely desir-able with new home construction continuing at asteady pace and the number of new households in-creasing by 4,000 during 1968 alone. Population inthe county has increased more than 14 percent since1960, and the population of every municipality hasalso grown.

New Jersey Bank (N. A.) is one of eight com-mercial banks which together operate a total of 52offices, and hold resources of $1.3 billion in PassaicCounty. While New Jersey Bank is the largest com-mercial bank in the county, First National Bank ofPassaic County ranks second, with total assets of$419 million and 19 offices. Because of the proxim-ity of Passaic County to New York, and the factthat many county residents commute to New Yorkfor employment, the large banks operating in NewYork City also compete on a substantial basis inPassaic County.

The Peoples National Bank of Sussex County,with IPC deposits of $6.2 million, commenced oper-ations in 1964 and currently operates one branchin Sussex County, located 11.8 miles north of themain office. The merging bank is essentially acountry bank, generally not considered sufficientlyequipped to deal with the anticipated growth ofthe area in which it operates. It has a capital defi-ciency problem, an imminent management succes-sion problem, and a lending limit that is inade-quate for existing and future needs.

Sussex County N.J., has an estimated populationof 70,000 and is located in the northwestern cornerof the State. The county encompasses an area of526.3 square miles and is divided into 24 munici-palities, the largest of which are Sparta Township,with a population of about 10,000, and NewtonTown, with a population of about 8,200. All othermunicipalities in the county have estimated popula-tion of less than 5,000. The area is generally ruraland agricultural, containing approximately 500

farms which utilize about one-third of the avail-able land area. The topography, generally hillywoodland dotted with numerous lakes and miles ofstreams and rivers, makes the area ideal for recrea-tional and resort purposes. Sussex County is almostcompletely devoid of major industrial facilities atthe present time, and approximately 40 percent ofthe working population travel outside of thecounty, mainly to Morris and Passaic counties, foremployment. Economic growth has been proceedingrapidly during the past decade, and it is expectedthat industry will move into the area in the not toodistant future.

Banking competition within Sussex County iscurrently provided by six commercial banks, threesavings and loan associations, and one buildingand loan association. The Bank of Sussex County,Franklin, is the largest commercial bank in thecounty, with total resources of $52 million and sixoffices. Peoples National Bank of Sussex County isthe smallest commercial bank in the county, withonly half the resources of the next largest bank.Additional competition within the county is pro-vided by branch offices of several Morris County,Passaic County, Orange County (N. Y.), and PikeCounty (Pa.) banks, many of which are muchlarger than any of the banks headquartered in Sus-sex County. The competitive effect of these banksbecomes even more significant in view of the largepercentage of the working population which leavesthe county for employment.

Consummation of this proposal will greatly ben-efit the Sussex County area where Peoples NationalBank of Sussex County now operates. By substitut-ing two offices of the much larger, more sophisti-cated and aggressive New Jersey Bank (N.A.) formuch smaller, less aggressive, rurally-oriented Peo-ples Bank, the merger will introduce, to that area,a breadth of banking services that it has not hith-erto experienced. It will also benefit the area byintroducing a bank more able to meet the county'spresent needs and contribute to its future eco-nomic growth and expansion. Among the advan-tages to be derived are a lending limit larger thanthat of any bank in the county and a commercialfinance department specializing in making accountsreceivable, inventory, direct and indirect equip-ment, Small Business Administration, and otherloans, thus offering new financing alternatives tolocal businesses. Because of the tremendous increasein resources, there will be a greater availability ofconstruction money, Small Business Administration

38


loans, F.H.A. mortgages, mortgage warehousingloans, and higher education loans. Other servicesto be made available to Peoples National Bank'scustomers include a full range of corporate andtrust services, computer services to aid local busi-nessmen with payroll and recordkeeping problems,and international services which, to date, havebeen handled by the merging bank through corre-spondent banks. The usual economies of scalewhich can be passed on to customers in better serv-ice at lower cost will be supplemented by savingsdue to the fact that the resulting bank itself willbe able to provide most of the services needed byits customers without relying on correspondentbanks. Finally, the Peoples Bank, which has amanagement succession problem, will have avail-able to it the sufficient depth of experienced,knowledgeable, and capable management which thecharter bank now possesses, ensuring sound opera-tions in the present and for the future.

Competition will not be adversely affected bythis merger. Because the nearest offices of the merg-ing banks are 29 miles apart and their main offices38.5 miles apart, there is virtually no competitionbetween them to be eliminated. In Passaic County,the addition of the smaller merging bank to thecharter bank would have little effect on the com-petitive position of the charter bank, which is al-ready the largest in that area. Because of the ur-banized, industrialized, and highly developednature of that area's economy, all banks, large andsmall, should continue to prosper and show goodresults. In addition, the merger should heightencompetition with the large New York banks thatcompete in Passaic County. In Sussex County, re-placing the smallest bank operating there with alarge, aggressive, and competitive out-of-county in-stitution would stimulate competition among allbanks, without unbalancing the competitive struc-ture in the resulting bank's favor. In addition, po-tential competition will not be adversely affectedsince most of the municipalities in Sussex Countyare closed to de novo branching due to State statu-tory home office protection or population require-ments. In fact, the subject merger will openSparta, the largest municipality in the county, tode novo branching.

Considered in the light of the statutory criteria,this merger is judged to be in the public interestand is, therefore, approved.

DECEMBER 5, 1969.


The closest offices of the merging banks are ap-proximately 30 miles apart, with several offices ofother commercial banks in the intervening area.Neither bank draws appreciable deposits or loansfrom the service area of the other. Therefore, itwould appear that the proposed merger would noteliminate any significant amount of existing com-petition between the merging banks.

Under New Jersey law, either bank could bepermitted to open de novo branches in the servicearea of the other, although not in communities sub-ject to home or branch office protection. As one ofthe largest banks in New Jersey, New Jersey Bankhas the resources to open de novo branches wherelegally permitted. Its opportunities for de novoentry into Sussex County are, however, somewhatlimited by home and branch office protection laws.For example, the town of Sparta, largest commun-nity in Sussex County, is protected by the homeoffice of Peoples itself.

The recent changes in New Jersey law have in-duced substantial merger activity by the largerbanks in the State as part of their market exten-sion programs. We believe that the largest of thesebanks, such as New Jersey Bank, should expandinto new areas either through de novo branchingor through acquisition of a smaller bank in thearea that they wish to enter. Such methods of ex-pansion are desirable from a competitive stand-point as they preserve leading local banks most ca-pable of providing competition to the largestbanks, and most likely, through affiliation with oneanother or in bank holding companies, to be ableto provide new competition to the large banks ona broad scale.

While New Jersey Bank is one of the largestbanks in the State, Peoples is one of the smallerbanks in Sussex County, and in those areas of thecounty which it primarily serves. Accordingly, weconclude that the proposed merger is unlikely tohave a significantly adverse effect on potential com-petition.

39


NORTHWESTERN NATIONAL BANK OF SIOUX FALLS, SIOUX FALLS, S. DAK., ANDLAKE PRESTON, S. DAK.


Community State Bank of Lake Preston, Lake Preston, S. Dak., withand Northwestern National Bank of Sioux Falls, Sioux Falls, S. Dak. (10592),which hadmerged Jan. 9, 1970, under charter and title of the latter bank (10592). Themerged bank at date of merger had

COMMUNITY STATE

Total assets

$6,502,795

129,971,893

136,325,911

BANK OF LAKE PRESTON,

Banking offices

Inoperation

1

12

To beoperated

13


On October 10, 1969, the Northwestern NationalBank of Sioux Falls, Sioux Falls, S. Dak., and theCommunity State Bank of Lake Preston, LakePreston, S. Dak., applied to the Office of the Comp-troller of the Currency for permission to mergeunder the charter and with the title of the former.

The Northwestern National Bank of Sioux Falls,the charter bank, is located in Sioux Falls, and hasIPC deposits of $95 million. The bank is a subsid-iary of Northwest Bank Corporation which isheadquartered in Minneapolis, Minn. The mergingbank, the Community State Bank of Lake Preston,is located in Lake Preston, Kingsbury County, andhas IPC deposits of $5.2 million.

The primary effects of the merger will be felt inKingsbury County which has a population of 9,227and contains five banks. The merger will merelyreplace a small, locally-owned bank with a branchof a much larger banking system. The KingsburyCounty area is almost exclusively an agriculturalone, and the recent trend toward consolidation offarms has left its banking facilities inadequate tomeet heavier loan demands. The merger will bringa bank with a lending limit of $900,000, ratherthan $70,000 as is available from the mergingbank, to the residents of Kingsbury County. In ad-dition, modern services such as computer services,a staff of agricultural credit experts, and a diversi-fied trust department will be made available in thecounty.

The merger will have no adverse effects on com-petition. The banks presently compete with eachother only to a very minimal degree. The closestbranches of the charter bank to Lake Preston are33, 32, and 37 miles from Lake Preston. Six otherbanks are located closer to Lake Preston than anybranch of the charter bank. Since the area is ruraland towns are widely separated, all banks andbank branches draw business primarily from the

areas immediately surrounding the banking offices.The merging bank draws over 89 percent of its de-posits and 95 percent of its loans from KingsburyCounty. The three closest Northwestern NationalBank branches, located in three different counties,draw comparable percentages of business from thecounties in which they are situated. There is an in-significant amount of overlap in the number ofcustomers common to both banks.

The merger will have little effect of the bankingstructure in the State. The resulting bank will gainless than one-half of 1 percent of total statewidedeposits and loans. However, it will greatly benefitthe banking customers of Kingsbury County whoserequirements far exceed the present capabilities ofany of the five local banks.

Applying the statutory criteria to the proposal,it is concluded that the merger is in the public in-terest. It is, therefore, approved.

DECEMBER 8, 1969.


The nearest branch of Sioux Falls Bank to LakePreston is located in Brookings (BrookingsCounty), 33 miles to the east. Other Sioux FallsBank branches are located 37 miles southeast ofLake Preston in Madison (Lake County) and 42miles west in Huron (Beadle County). In each case,there are banks intervening between Lake PrestonBank and the existing Sioux Falls Bank branchoffices. Nevertheless some of Lake Preston Bank'scustomers also maintain accounts at one of thethree closest Sioux Falls Bank branches. It appearstherefore that a little existing competition will belost as a result of this merger.

South Dakota law prohibits the establishment ofa de novo branch in a community in which anyState or National bank previously has been author-ized to operate. The only method of obtaining abranch in Lake Preston is through the acquisition

40


of, or the consolidation with Lake Preston Bank.However, Sioux Falls Bank could enter other com-munities in Kingsbury County, or Sioux FallsBank's parent, Northwest Bancorporation, couldhave sought a charter for a new bank in LakePreston.

In the light of the size and economic outlook ofLake Preston and Kingsbury County, they are notvery attractive for the establishment of an addi-tional bank. Thus, it cannot be said that any sub-stantial meaningful potential competition will belost as a result of the proposed merger.

THE CITIZENS NATIONAL BANK OF BRYAN, BRYAN, OHIO, AND THE WEST UNITY BANKING COMPANY, WEST UNITY, OHIO


The West Unity Banking Company, West Unity, Ohio, withand The Citizens National Bank of Bryan, Bryan, Ohio (13740), which had . . . .merged Jan . 19, 1970, under charter of the latter bank (13740) and title "TheCitizens National Bank." The merged bank at date of merger had

Total assets

$7,476,66318,416,311

25,976,478

Banking offices

Inoperation

12

To beoperated

3


On July 16, 1969, the Citizen's National Bank ofBryan, Bryan, Ohio, and The West Unity BankingCompany, West Unity, Ohio, applied to the Comp-troller of the Currency for permission to mergeunder the charter of the former and with the title"The Citizens National Bank/' A public hearingon the application was held on October 15, 1969,in Cleveland, Ohio.

Both the applicant bank and the merging bankare located in Williams County in the northwest-ernmost portion of Ohio, bordering on Michiganon the north and Indiana on the west. Althoughthe county as a whole is rural in nature, manufac-turing workers comprise 40 percent of the laborforce. In 1964, the approximately 215,000 acres offarm land were divided into 1,600 farms whoseaverage value exceeded $40,000. Farm size in thecounty has steadily increased since that time, andpresently the average farm size is estimated at 150acres, with a value of about $600 per acre. Therebeen a concomitant increase in mechanized farm-ing.

Bryan, the home of the applicant bank and thecounty seat, is the largest community in WilliamsCounty, and has a population of 8,000. There are26 manufacturing plants in or around Bryan andthese companies employ approximately 3,800 per-sons. Major firms include Aro Corporation whichproduces tools, power motors, and self-feed drills,employing over 1,100 persons; Ohio Art Company,employing over 600 persons; Spangler Candy Com-

pany, employing over 300 persons; and, VistronCorporation, employing 355 persons.

The Citizens National Bank of Bryan, with IPCdeposits of $14.7 million, was established in 1933,and presently operates through its main office andone in-town branch.

West Unity, home of the merging bank, is asmall rural community with a population of 1,600persons. Within the immediate vicinity of the townare seven industrial firms employing 530 persons.The largest employer is the Fifty-plus-Five Corpo-ration which employs 385 persons. Farming is themajor contributor to the economy of West Unity,and has been since the town came into existence.

The West Unity Banking Company, with IPCdeposits of $6.3 million, was established in 1913,and presently operates as a unit bank. Althoughthe bank showed substantial deposit growth be-tween 1964 and 1968, deposits during that periodincreasing by some 85 percent, there was a markedslowdown in the bank's growth during the first 6months of 1969, with deposits down more than$300,000, or 4 percent.

Although substantial evidence relating to the rel-evant market was submitted by both parties at thepublic hearing, it is concluded that it would notbe unreasonable to include within that area por-tions of Defiance and Fulton counties. Within thatmarket area there are 13 banks and one savingsand loan association. Those 14 institutions havetotal deposits of $116.7 million. Although the rele-vant market area includes more than Williams

41


County, when that county itself is compared toother similar Ohio counties, it ranks 17th amongthe 24 counties in terms of absolute deposit size ofits leading bank. The county ranks 23rd in termsof market share of the lead bank and people perbanking office. It ranks last in concentration of itslargest bank, both in terms of loans and of depos-its. The county, with nine banks, ranks first ofthose 24 counties in terms of number of banks.

Although some direct competition between theconstituent banks will be eliminated as a result ofthis merger, the public should be better served.The resulting bank will be large enough to meetthe expanding needs of its customers, particularlythose of the farmer with his ever increasing scaleof operations and his need for improved farmcredit expertise. With the average size of a farm inWilliams County now being 150 acres, and the av-erage capital requirement for land alone at$90,000, it is apparent that a need exists for avail-able working capital loans. The resulting institu-tion will be better able to compete for certaincommercial loans and deposits that are now beingplaced with out-of-territory banks. A number ofcorporate borrowers who now seek financing fromout-of-territory banks, particularly in Toledo, FortWayne, Detroit, Cleveland, and Chicago, wouldbenefit from this merger since a greater portion oftheir credit needs could be met locally. Finally,lack of competent successor management at TheWest Unity Banking Company will be resolved bythe merger. Although the resulting bank will bethe largest bank in its service area, its size shouldstimulate more extensive competition from the re-maining banks.

It is concluded that this proposal is in the pub-lic interest and meets the relevant statutory crite-ria. The merger is, therefore, approved.

DECEMBER 18, 1969.


The proposal would merge the largest and fifthlargest commercial banks operating in WilliamsCounty, Ohio.

Head offices of the participating banks are about10 miles apart, and there are no banking offices inthe intervening area. Both banks have accountsfrom most areas of the county. Hence, competitionexists between the two banks. This competitionwill be permanently eliminated by the proposedmerger.

Commercial banking in Williams County is con-centrated. As of June 29, 1968, there were a totalof nine banks, including the applicants, with totaldeposits of $65.3 million. Of that total, CitizensBank, the largest, held about 22.2 percent, WestUnity Bank, the fifth largest, held about 9.2 per-cent, and the four largest banks held 68.3 percent.If the proposed merger were consummated, the re-sulting bank would hold about 31.4 percent, andthe four largest banks about 77.5 percent, of thesedeposits. Hence, the merger would substantially in-crease concentration in an already concentratedbanking market.

Consummation of the proposed merger willeliminate existing competition between the partici-pants and will increase banking concentration.Consequently, it is our view that the proposedtransaction will have an adverse effect upon com-petition.

WACHOVIA BANK AND TRUST COMPANY, N.A., WINSTON-SALEM, N.G., AND CITIZENS BANK & TRUST COMPANY OF ANDREWS,ANDREWS, N.C.


Citizens Bank & Trust Company of Andrews, Andrews, N.C, withand Wachovia Bank and Trust Company, N.A., Winston-Salem, N.C. (15673),which hadmerged Jan. 23, 1970, under charter and title of the latter bank (15673). Themerged bank at date of merger had

1

1

Total

$33,

,596,

,629,

assets

025

594

620

,897

,516

,413

Banking offices

Inoperation

8

133

To beoperated

141

42



On September 5, 1969, Wachovia Bank andTrust Company, N.A., Winston-Salem, N.C., andCitizens Bank 8c Trust Company of Andrews, An-drews, N.C., applied to the Comptroller of theCurrency for permission to merge under thecharter and with the title of the former.

Wachovia Bank and Trust Company, N.A., is astatewide banking system operating 119 offices in43 communities of North Carolina. North Carolinaranks among the states showing the greatest eco-nomic development. On the eastern seaboard, theport facilities are being expanded, recreational andbeach resort development has increased, truckfarming and poultry plants have grown, and therehas been an influx of light industry. In the mid-eastern and central sections, light industry hasbeen replacing tobacco production. In the Pied-mont area, industrialization and distribution facili-ties have been expanding. Although North Caro-lina leads the country in furniture and tobaccomanufacture, its leading industry is textiles, partic-ularly yarn and hosiery manufacturing. The west-ern, or mountain, region provides strong economicsupport for the furniture, wood products, and tex-tile industries of the Piedmont area. Fourstatewide branch bank systems and five sizable re-gional branch systems have played a significantrole in the economic development of the State.

Communities with offices of Wachovia extendfrom Elizabeth City in the east to Asheville in thewest. Although it is a statewide bank, it operatesno branches west of Asheville. It generates the ma-jority of its business from the Piedmont Crescent,the area beginning with Charlotte on the west,going through the Piedmont Corridor to Winston-Salem, and east to the Raleigh-Durham area. Thecharter bank, which presently has IPC deposits of$1.1 billion, was organized in 1879, and has been aleading bank in the southeastern United States formany years.

The charter bank, with assets of $1.6 billion,competes with every major bank in the southeast-ern part of the country. Its primary competitors inNorth Carolina are the $1.3 billion North Caro-lina National Bank, the $1 billion First Union Na-tional Bank, the $660 million First Citizens Bankand Trust Company, and the $450 million North-western Bank of North Wilkesboro. While Wach-ovia is still the largest bank in North Carolina, itscompetitors' growth rates have been much greater

in the past 8 years. Wachovia's share of the NorthCarolina banking market declined from 24.1 per-cent, in 1960, to 22.3 percent, in 1968.

Citizens Bank & Trust Company of Andrewsserves a 5-county area in the westernmost part ofthe State, the heart of economically-depressed Ap-palachia. Those five counties are Cherokee, Clay,Graham, Jackson and Macori. While the averageannual employment in the entire State rose 15 per-cent between 1960 and 1967, the economy in all ofthose counties except Cherokee has been rela-tively static. Cherokee County had sizable indus-trialization in recent years. The economy of thefive counties is supported only by marginal agricul-ture and a small amount of textile, apparel, andfurniture manufacturing. At present, the five coun-ties combined do not equal the average North Car-olina county in bank deposits, retail sales, personalincome, value added by manufacturing, or newcapital expenditures. The towns where the bankhas branches are generally small and are experienc-ing a population decrease. In 1960, those townshad populations ranging from 342 to 2,235. As thearea is highly isolated and inaccessible because ofmountainous terrain, businesses and residences areclustered around towns and communities in thevalleys. The area, however, presents a challenge forexpanding enterprise for the labor supply is abun-dant, water resources are plentiful, electric poweris economical through TVA facilities, and a varietyof mineral and forest products are available.

The Citizens Bank & Trust Company of An-drews, which has IPC deposits of $23 million, wasestablished in 1924. It opened its first branch inMurphy, in Cherokee County, in 1933. In 1943, asecond branch was opened in Robbinsville, in Gra-ham County. A third branch was established inHayesville, in Clay County, in 1945. The threeother branches are in Jackson County; one inSylva opened in 1962, one in Cullowhee opened in1963, and one in Cashiers opened in 1966.

The merging bank, primarily through its An-drews, Murphy, and Robbinsville offices, has grownsubstantially, from deposits of $12.6 million in1963, to $26.4 million in 1968. The bank has beengenerally conservative in its policies however; itsownership and management has been the samesince 1926. The senior officers are in their seventiesand no provision has been made for succession inits lending officers. Although the bank has met thelimited credit needs of the counties' residents, thelarger credit needs of the area's industries have

43


had to be met by large regional or statewidebanks. The merging institution does not providetrust services, automation, or sophisticated creditservices. Most of the bank's business is of personalnature, such as loans to individuals, real estatemortgages, and direct installment lending.

In three of its five counties, Cherokee, Clay, andGraham, the merging bank was the only bank withestablished facilities until, in April 1969, a branchof the Bank of Franklin was established in Mur-phy, Cherokee County. The Bank of Franklinmerged into First Union National Bank of NorthCarolina on September 15, 1969. Head office com-petition for the merging bank is offered by a localbranch of the $1 billion First Union NationalBank, and a Bryson City office of the $450 millionNorthwestern Bank. In the town of Cashiers, com-petition comes from a nearby office of First UnionNational Bank in Highland, from an office of FirstCitizens Bank & Trust Company in Brevard, andfrom an office of First Union National Bank inSylva. In Franklin, competition comes from anoffice of First Union National Bank; in Hayesville,from the Bank of Hiawassee; and, in Murphy,from a First Union National Bank office. In Sylvaand Cullowhee, there are competing offices of FirstUnion National Bank. Some competition for theSylva and Cullowhee offices derives from the Bry-son City and Hazelwood offices of NorthwesternBank.

There is not significant competition between theapplicant banks. The head office of Wachovia Bankis 237 miles northeast of the head office of CitizensBank. The nearest office of the charter bank is theAsheville branch, 50 miles northeast of the Citizensoffice in Sylva. There are several offices of competi-tors in communities lying between. AlthoughWachovia Bank services several large corporate ac-counts in the merging bank's service area, it hasnever bid for the type of business handled by themerging bank. The merger will not eliminate apotential competitor as there is little economicincentive for Wachovia Bank to enter CitizensBank's market area through de novo branching.

There is considerable competition from variousnon-bank financial institutions. Savings and loanassociations offer Wachovia Bank increasing com-petition in 75 percent of the cities in which it oper-ates. There are five savings and loan associations inthe merging bank's market area. A substantialnumber of insurance companies do business inWachovia's service area. There are 30 insurance

companies operating in the five counties served bythe merging bank. Between 1955 and 1967, thenumber of credit unions in the State increased 23.1percent, an indication of their increasing competi-tion for savings deposits and loan business. Thereare three credit unions in Citizens Bank's servicearea, and eight more in the three counties betweenit and Asheville. The growth in the number of con-sumer finance agencies in the State was 347.3 per-cent between 1950 and 1968. There are four suchinstitutions in the five counties served by the merg-ing bank. In the less developed regions of theState, particularly the extreme western section,U.S. Government agencies lend substantialamounts of money.

This merger will benefit the communities in thefar western part of the State through the special-ized services and trained management which willbe offered by the resulting bank but are not avail-able. As the resources and policies of the largerbank will aid in the economic development of thearea, the merger is in the public interest.

It is concluded that the proposal is in the publicinterest and meets the relevant statutory criteria.The merger is, therefore, approved.

DECEMBER 24, 1969.


The closest offices of Wachovia to any of thoseof Citizens Bank are in Asheville, about 47 milesfrom Citizens Bank's Sylva office and approxi-mately 86 miles from the head office of CitizensBank in Andrews and there are intervening officesin Waynesville operated by the State's third andfourth largest banks. The proposed merger, there-fore, would not appear to eliminate any significantamount of direct competition between the twobanks.

Since North Carolina law permits statewide denovo branching, the proposed merger would elim-inate the potential for increased competition thatwould result if Wachovia were to establish de novooffices in any of the five counties in which CitizensBank presently operates offices. Wachovia has the re-sources to establish de novo offices in new marketsand is clearly the largest potential entrant into the5-county area. Four of the State's five largest banks,including Wachovia, presently have offices in Ashe-ville; of these four, however, only Wachovia doesnot now operate offices in any of the eight countieswest of Asheville.

As of June 29, 1968, Citizens Bank had offices in

44


four counties (its Franklin office was opened inMarch, 1969); it was the only bank at that time inthree counties and in the fourth, Jackson County,it held 28 percent of total county deposits while

First Union held 72 percent. In the 5-county area,on the basis of June 29, 1968 data, Citizens Bankwould account for approximately 54 percent oftotal area deposits and First Union the remainder.

UNITED STATES NATIONAL BANK, SAN DIEGO, CALIF., AND SOUTHLAND NATIONAL BANK, YUGAIPA, CALIF.


Southland National Bank, Yucaipa, Calif. (15488), withwas purchased Jan. 30, 1970, by United States National Bank, San Diego, Calif.(10391), which hadAfter the purchase was effected, the receiving bank had

Total assets

$17,378,384

535,762,328553,140,712

Banking offices

Inoperation

3

56

To beoperated

59


On January 29, 1970, application was made tothe Comptroller of the Currency for permission forthe United States National Bank, San Diego, Calif,to purchase assets and assume the deposit liabilitiesof the Southland National Bank, Yucaipa, Calif.

In accordance with the provisions of 12 U.S.C.181 and 12 U.S.C. 1828 (c), it is found that an

NOTE: Due to the emergency nature of the situation, a re-port on the competitive factors was not requested.

emergency exists and that this Office must act im-mediately to prevent the probable failure of theSouthland National Bank and to protect its deposi-tors, creditors, and shareholders.

Accordingly, approval by the shareholders of theSouthland National Bank of the purchase and saleagreement is waived and the United States Na-tional Bank is authorized to proceed with the pur-chase and assumption transaction.

JANUARY 30, 1970.

NORTH CAROLINA NATIONAL BANK, CHARLOTTE, N.G., AND MARION BANK AND TRUST COMPANY, MARION, N.C.


Marion Bank and Trust Company, Marion, N.C, withand North Carolina National Bank, Charlotte, N.C. (13761), which hadmerged Feb. 20, 1970, under charter and title of the latter bank (13761). Themerged bank at date of merger had

Total assets

$4,638,6851,223,694,661

1,228,333,346

Banking offices

Inoperation

293

To beoperated

95


On October 15, 1969, North Carolina NationalBank, Charlotte, N.C, and the Marion Bank andTrust Company, Marion, N.C, applied to theComptroller of the Currency for permission tomerge under the charter and with the title of theformer.

North Carolina National Bank, Charlotte, N.C,with IPC deposits of nearly $800 million, operates90 branches scattered widely across the State. The

bank's main service area coincides with the princi-pal economic growth area in the State, extendingin a crescent from Raleigh, in the north-central sec-tion, to Charlotte, in the southwestern portion.

Marion Bank and Trust Company, Marion, N.C,with IPC deposits of $3.6 million, was organizedin 1929 as an industrial bank. It became a com-mercial bank in 1961. The bank's main officeand its one branch are located in Marion, which,with a population estimated at 3,300, is the countyseat of McDowell County, and lies about 90 miles

45


northwest of Charlotte on the slopes of the BlueRidge Mountains in west-central North Carolina.Manufacturing is the most important source of em-ployment in the county; the textile and furnitureindustries, both of which are characterized by lowwage scales, are of primary importance. McDowellCounty lags behind the rest of the State in in-come and population growth, and little improve-ment is predicted.

There is no significant competition between themerging banks. The nearest office of the charterbank to the merging bank is in Morganton, ap-proximately 20 miles east of Marion in BurkeCounty. Neither bank draws a significant amountof business from the service area of the other. Fur-thermore, an analysis of the merging bank's loanportfolio, with its heavy concentration of install-ment credit, indicates that this bank is not primar-ity in competition for the other types of credits andservices offered by commercial banks. Nor does itappear that the charter bank is a likely potentialentrant into the service area of the merging bankbecause that area is presently served by branches oftwo of North Carolina's largest banks which havestatewide branching systems, and because of theslow economic growth predicted for McDowellCounty. Due to its limited size and resources, andthe distances involved, it does not appear probablethat the merging bank would establish branch oper-ations in any area now served by the charter bank.Consummation of this proposal will not signifi-cantly increase banking concentration in NorthCarolina as the charter bank's percentage of totalbank deposits in the State will increase by less than0.1 percent of its present share. Approval of thisproposal will result in increased competition be-tween the resulting bank and both the First UnionNational Bank of North Carolina, Charlotte, N.C.,which has system deposits of nearly $850 millionand operates two branches in Marion, and theNorthwestern Bank, North Wilkesboro, N.C., whichhas system deposits in excess of $400 million andoperates a branch in Old Fort, about 9 miles eastof Marion.

When the merger is completed, the bankingpublic in the service area of the merging bank willbenefit from the availability of the banking serv-ices and resources of another bank with the finan-cial expertise and resources to aid in the develop-ment of McDowell County. In addition, it isanticipated that the increased competition result-ing from approval of this merger will result in

benefits to the public in the form of improvedbanking services by the existing banks in this area.

Applying the statutory criteria, we conclude thatthe proposal is in the public interest, and the ap-plication is, therefore, approved.

JANUARY 3, 1970.


NCNB has no offices in McDowell County; itsclosest offices to those of Marion Bank are locatedin Morganton, in adjoining Burke County, about19 miles east of Marion, and in Try on and Colum-bus, in adjoining Rutherford County, about 30 to35 miles south of Marion. According to the appli-cation, neither of the merging banks draws signifi-cant amounts of deposits or loans from the areasserved by the other. The proposed merger there-fore would not appear to eliminate any substantialamount of direct competition.

Since North Carolina law permits statewide denovo branching, the proposed merger would elimi-nate the potential for increased competition thatwould result if NCNB were to establish de novooffices in McDowell County. NCNB has the re-sources to establish de novo offices in new marketsand could be considered a potential entrant intoMcDowell County. NCNB is the second largestcommercial bank eligible to enter McDowellCounty. Wachovia Bank and Trust Company,N.A., the State's largest bank, and First CitizensBank & Trust Company, the State's fourth largestbank, also maintain offices in counties contiguousto McDowell County; Wachovia's closest office toMcDowell County is in Morganton.

In addition to Marion Bank, two other banksoperate offices in McDowell County: First UnionNational Bank of North Carolina, the State's thirdlargest bank, operates two offices in Marion; and,The Northwestern Bank, the State's fifth largestbank, operates an office in Old Fort. As of June 29,1968, Marion Bank held approximately 21.4 per-cent of total deposits in the county, First Unionheld 64.4 percent, and Northwestern Bank held14.2 percent.

It should be noted, however, that the proposedmerger is part of a continuing trend of mergersand acquisitions by North Carolina's largest com-mercial banks, which has the effect of retarding thedevelopment of a more competitive banking struc-ture in North Carolina and results in the samelimited group of competitors facing each other inan increasing number of the State's banking mar-

46


kets. If the proposed merger is approved, commer-cial banking in McDowell County will be entirely

distributed among three of the State's five largestbanks.

COUNTY NATIONAL BANK, MIDDLETOWN, N.Y., AND ROCKLAND NATIONAL BANK, SUFFERN, N.Y.


Rockland National Bank, Suffern, N.Y. (5846), withand County National Bank, Middletown, N.Y. (13956), which hadmerged Feb. 27, 1970, under charter of the latter bank (13956) and title "EmpireNational Bank." The merged bank at date of merger had

Total assets

$149,118,970171,844,047

320,963,017

Banking offices

Inoperation

1428

To beoperated

42


On October 9, 1969, the Rockland NationalBank, Suffern, N.Y., with deposits of $136 million,and the County National Bank, Middletown, N.Y.,with deposits of $147 million, applied to the Officeof the Comptroller of the Currency for permissionto merge under the charter of the latter and withthe title of "Empire National Bank."

County National Bank, organized in 1934, andheadquartered in Middletown, N.Y., is a full-serv-ice institution with IPC deposits of $115.9 million.Since 1959, the charter bank has established eightde novo branch offices in Orange and Sullivancounties. The bank presently operates 28 offices, 15of which are in Orange County, 10 in DutchessCounty, and three in Sullivan County. As of June30, 1969, the bank had assets of $172.7 million anddeposits totaling $146.5 million.

Rockland National Bank, formed in 1901 underthe name "The Suffern National Bank and TrustCompany," assumed its present name in 1967. Thebank is headquartered in Rockland County andoperates 13 offices therein. Seven de novo brancheshave been opened in the county since 1960 and abranch location in the Blue Hill Complex, PearlRiver, Rockland County, is approved but un-opened. As of June 30, 1969, total assets of Rock-land National Bank were $151.3 million, and totaldeposits were $135.7 million.

The service area of both participating banks liesin the Third Banking District of New York. Thecharter bank operates in an area which includesthe whole of Orange County, the southern portionof Dutchess County between the Hudson Riverand the Taconic Parkway, and the eastern tip ofSullivan County contiguous to Orange County.

The merging bank serves Rockland County and asmall portion of Orange County on Route 17 inTuxedo Park.

Sullivan County, with a population of 48,000,lies in the northwest section of the proposed servicearea. Much of the 663,040 acres of the county isvery hilly and dotted with lakes. A large resort in-dustry has developed for the 2 million touristsand vacationers who visit the lakes and luxury ho-tels in the area every year. Much of the county re-mains rural in character and devoted to poultryand dairy farming.

Commercial banking in Sullivan County is rep-resented by the main offices of four commercialbanks and their six branch offices. The largest ofthese banks is the $37 million Sullivan County Na-tional Bank of Liberty, Liberty N.Y. The otherbanks include the $31 million National UnionBank, Monticello, N.Y., the $14.5 million UnitedNational Bank, Callicoon, N.Y.; and the $11.4million single-unit First National Bank of Jeffer-sonville, N.Y. In addition to the aforementionedbanks, 10 branch offices of banks headquartered inother counties operate in Sullivan County. Onesavings and loan association branch operates inSullivan County at Monticello, N.Y.

Orange County, with a present population esti-mated at 213,000, has shown a steady growth overthe years due to its proximity to New York City.Principle cities in the county include Middletown,home of the charter bank, with 22,000 people;Newburgh, with 32,000 people; and Port Lewis,with approximately 10,000 people. The economy ofthe area is based primarily on dairy and truckfarming which has a volume in excess of $30 mil-lion each year. There is evidence of a growing

47


manufacturing and industrial base utilizing theskilled, and semiskilled, manpower and the excel-lent transportation facilities that the area affords.The leading industries in the county, as measuredby the number of persons employed, include thefollowing: apparel, 3,600; textiles, 2,200; chemicals,1,400; and, food, 1,200. Nationally known concernsinclude the Arrow Corporation, InternationalNickel Co., Rubberoid Corporation, and DuPontCompany. Manufacturing activities are largely con-fined to Middletown and Newburgh.

In addition to the charter bank, 11 commercialbanks, with 37 branch offices, are headquartered inOrange County. These include the $49 millionHighland National Bank of Newburgh, the $46million First National Bank of Highland, the $33million Chester National Bank, the $29 millionColumbus Trust Company, the $27 million OrangeCounty Trust Company, and the $23 million Na-tional Bank of Orange and Ulster Counties. Sixbranch offices of banks headquartered outside thecounty also serve the county. Fourteen savings insti-tutions with 18 branch offices operate throughoutthe area and are active competitors for the savingsdollar and residential loans.

Dutchess County, with a present population ofapproximately 220,000, is in the northwest sectionof the proposed service area. The economy of thecounty is mixed industry and agriculture, with in-dustry largely centered around Poughkeepsie, thecounty's largest city. The remainder of the countyreflects its agricultural heritage. The largest em-ployers are International Business Machines, em-ploying over 5,000, and Shatz Manufacturing Co.,Federal Bearing Co., and Texas Research Center,each having at least 1,000 employees.

The banking needs of Dutchess County areserved by 11 commercial banking institutions with21 branch offices. These include the $161 millionMarine National Bank of Southeastern New York,the $39 million Dutchess Bank and Trust Com-pany, and the $23 million First State NationalBank. In addition, the county is served by six sav-ings banks and four savings and loan associations.

Rockland County, headquarters for the mergingbank, is situated immediately west of WestchesterCounty, southeast of Orange County, and contig-uous to metropolitan New York City, which is im-mediately south. It is one of the fastest growingregions in the State, recording a population growthfrom 136,000, in 1960, to 220,000, today, a 60 per-cent increase. Rockland has 110,355 acres of land, of

which 38,017 acres, or 34 percent, is used by insti-tutions, parks, and public facilities. Almost three-fourths of the county parkland is in the PalisadesInterstate Park, which forms a natural barrier be-tween Rockland County and Orange, and stretchesfrom the Hudson River to the New Jersey border.Geographically, the center of Rockland County is33 miles from the center of Manhattan. Sincetransportation facilities are well developed betweenthe city and the communities located in thecounty, many people find it attractive and conven-ient to live in the suburban atmosphere of thecounty and commute to jobs in the city. It is esti-mated that in 1960, 27 percent of the county workforce commuted to jobs outside the county. Thecounty is undergoing rapid urbanization which isreflected in large numbers of new single familysubdivisions, modern apartment houses, shoppingcenters, and industrial plants. Rockland Countyhas the third highest household income, $13,363, inNew York State. As of 1963, there were 196 manu-facturing firms in the county, employing 12,127persons on a payroll of $74.2 million. In 1963,Rockland County has 1,256 retail establishmentswith sales of $198.3 million, and total payrolls of$20.2 million; by 1968, retail trade had increasedto $292.4 million. Rockland County also had 145wholesale trade establishments with sales of $79.3million in 1963. Those firms employed 1,204 peo-ple, and had a total annual payroll of $7.5 mil-lion. The largest employers in the county includeAvon Products, Inc.; Lederle Laboratories; Conti-nental Can Co., Inc.; Geigy Chemical Corporation;Kay-Fries Chemical, Inc.; and Flintkote Co.

Rockland County is presently serviced by fivecommercial banks and 48 branch offices. They in-clude, in addition to the merging institution, the$84 million Marine Midland Trust Company ofRockland County, the $48 million Tappan ZeeNational Bank, and the $43 million Nanuet Na-tional Bank. Moreover, six savings banks and sav-ings and loan associations service the area.

There is no significant competition between theapplicant banks. Their head offices are 40 milesapart, and County National Bank has no branchesin Rockland County. Although Rockland NationalBank has a single branch in Orange County, atTuxedo Park, which is but 1 mile away fromCounty National Bank's Sterling Forest office,there is negligible competition between them be-cause of the terrain of the area, expressways and arailroad line separate the countryside, and the

48


present population distribution, which polarizesSterling Forest and Tuxedo Park into two separateresidential areas. Further competition between thetwo banks is prevented by Palisades Interstate Parkwhich effectively divides the remaining portions ofthe respective service areas from the New Jerseyborder to the Hudson River. No convenient roadto link Rockland County with the County Na-tional Bank's service area to the north has been es-tablished through this park.

The geographic distribution of deposits of thetwo banks reveals that 89 percent of Rockland Na-tional Bank's IPC demand deposits are derivedfrom Rockland County, and 93.4 percent ofCounty National Bank's IPC deposits come fromOrange, Dutchess, and Sullivan counties. By con-trast, only 3.5 percent of Rockland NationalBank's IPC deposits and only 0.7 percent ofCounty National's IPC deposits are derived fromthe other's service area. The respective ratio ofcommercial loans for those same areas indicates thatonly 8.9 percent of Rockland National's loans orig-inate in County National Bank's service area, and1 percent of County National Bank loans are de-rived from Rockland National Bank's trade area.

There is little potential for future developmentof competition between the merging banks. Al-though de novo branching by one applicant intothe other's service area is possible, two factors miti-gate against this possibility. First, the New Yorkhome office protection law closes the most economi-cally attractive cities to branching. Secondly, bothservice areas appear to be adequately serviced bycommercial banking institutions; the population tooffice ratio is markedly lower than the State aver-age. New York State on the whole has an office forevery 7,339 people, while Rockland County has anoffice for every 4,639 persons; Orange County hasan office for every 4,536 persons; and SullivanCounty, has one office for every 2,415 people. Al-though Dutchess County has only one office forevery 6,000 people, its geographical isolation fromRockland County makes unfeasible de novo entryby the Rockland National Bank.

The proposed merger will not adversely affectthe banking structure in the resulting bank's serv-ice area which resembles the Third Banking Dis-trict with the exception of Westchester, Putnam,and Ulster counties. However, a sound analysis ofthe applicant's competiton must include mostlarge banks in the Third District because of twoimportant factors: first, the potential for branching

in the Third District by any bank headquarteredin that district; and, second, the existence, in thedistrict, of the five largest New York State regis-tered bank holding company systems, which haveseven affiliated banks and operate 52 offices directlycompetitive with the applicants in the four coun-ties where the applicants' offices are located. Thedistrict's two largest banks, the $827 millionCounty Trust Company, White Plains, N. Y., with59 offices, and the $402 million National Bank ofWestchester, with 34 offices, are affiliated with the$2.5 billion Bank of New York Company, Inc., andthe $1.5 billion Lincoln First Banks, Inc., respec-tively. In addition, the Dutchess Bank and TrustCompany, with 5 offices, is affiliated with the $5billion Charter New York Corporation; the MarineMidland Bank of Southeastern New York, with 12offices, and the Marine Midland Trust Company ofRockland County, with 11 offices, are affiliatedwith the $5.5 billion Marine Midland Banks, Inc.;and the First State Bank of Rockland County, with12 offices, and the State of New York NationalBank, with 9 offices, are affiliated with the $7.4 bil-lion Bankers Trust New York Corporation. Thecombined resources of the resulting bank, $324million, represent only 1.4 percent of the re-sources of these registered bank holding companieswhich, through their affiliated subsidaries, furnishextremely keen competition to the applicant banksthrough steadily accessible lines of credit, a widerange of services, and aggressive management.

Among the commercial banks headquartered inthe Third District, County National Bank andRockland National Bank ranked third and sixth,respectively. After the merger the resulting bankwill continue to rank third behind County TrustCompany and National Bank of Westchester, hold-ing approximately 10 percent of the district's $2.8billion in total commercial deposits.

The mutual savings banks and savings and loanassociations also offer strong competition for de-posit and loan business. The 31 savings banks and30 savings and loan associations headquartered inthe Third Banking District have total deposits of$2.4 billion, and loan accounts of $2.1 billion.Since both types of savings institutions are permit-ted by law to pay a higher rate of interest for sav-ings deposits, the competitive position of thesethrift institutions will be largely unaffected by theproposed merger, and they will continue to be astrong financial influence on the commercial banks.

Another significant deterrent to any adverse im-

49


pact by the resulting bank on the banking struc-ture in the service area is the proximity of NewYork City to Rockland, Orange, Sullivan, andDutchess counties. Since Rockland and Orangecounties are prime residential regions, dotted with"bedroom" communities for residents who work inNew York City, many of these people who com-mute to work fulfill their banking needs with thelarge New York City banks. This permits the citybanks, to compete in the Third District without ac-tually entering physically.

The resulting bank will provide its customerswith a broader range of services than either of thetwo banks can now provide alone. The lendinglimit will be increased to $1.9 million, therebydoubling the present lending limit of both appli-cant institutions. This will permit the large in-dustrial and manufacturing firms which, in the lastfew years, have had to seek assistance from NewYork City banks, to reestablish credit relationshipswith the applicant. Not only will the larger lendinglimit better the resulting bank's competitive posi-tion, but it will also ensure the retention of de-posits that might otherwise have been withdrawnand then deposited in the New York City banks,in order to acquire lines of credit. The merger willprovide the area with a trust department with anadequate staff, having sufficient capability to com-pete directly with other area banks and with thelarge New York City banks for the corporate andpersonal trust business that presently exists andthat is predicted for the future. The resulting bankintends to develop an international services de-partment. With many manufacturing companiesin the service area who export a large portion oftheir output, it is believed that an internationaldepartment would benefit the firms and individualsrequiring such services. Additional benefits to thecustomers and communities served by the resultingbank are apparent from the bank's intent to enterthe field of municipal financing. Expanded and im-proved computer services will be made available,and management depth, especially in County Na-tional Bank, will be increased by a recruitment andtraining program that neither applicant bank canpresently afford.

Applying the statutory criteria to the proposedmerger, we find that it is in the public interest.The application is, therefore, approved.

JANUARY 23, 1970.


The head offices of the merging banks are about40 miles apart, but RNB's Orange County branchin Tuxedo is only about 2 miles from CNB'sSterling Forest branch. There would appear to besignificant competition between these twobranches.

While CNB does not draw substantial depositsfrom Rockland County, RNB's competitive influ-ence in Orange County is not insubstantial. RNBdraws about 3.4 percent of its total IPC demanddeposits, or about $1.3 million, and about 4.2 per-cent of its total savings deposits, or about $2.5 mil-lion, from Orange County. We conclude, therefore,that the proposed merger would eliminate someamount of direct competition between the mergingbanks.

New York State law limits de novo branching bya commercial bank to the banking district withinwhich it is headquartered. In addition, New Yorkhas a home office protection law prohibiting denovo branching into cities or villages where thehead office of another bank is located. Both CNBand RNB are located in the Third Banking Dis-trict, which consists of the counties of Westchester,Putnam and Ulster, as well as, Orange, Rockland,Dutchess and Sullivan. Thus, each bank may le-gally open de novo branches in the areas wherethe other bank derives most of its business.

CNB is one of the largest and most capable po-tential entrants into Rockland County, whereRNB maintains its leading market position. Al-though several of the county's major populationcenters are closed at present to de novo branchingby State home office protection laws, RocklandCounty has been one of New York's fastest grow-ing areas with an estimated 60 percent increase inpopulation in 1960's. This growth is expected tocontinue at a rate of 6 percent annually to 1975,and 3 percent annually from 1975 to 1990. Itwould appear that desirable possible alternativesfor de novo entry by new banking institutions willattend such growth.

Although there are other banks with comparablelegal and financial ability to enter RocklandCounty, and although New York's developing pat-tern of holding company formation and entry maybring new competitive influences into RocklandCounty, CNB's status as one of the district's largestand most widely distributed banks renders it one


of the more likely potential entrants; accordingly,its merger with the county's largest bank, interms of local deposits, would have an adverse ef-fect on potential competition.

In like manner, RNB is one of the largest bankslegally permitted to open new branches in Orange,Dutchess and Sullivan counties, where CNB pres-ently competes. The most serious effect on poten-tial competition presented by the proposed mergeralong this line would appear to be in OrangeCounty, where CNB maintains by far the leadingcompetitive position. While some of Orange Coun-ty's major population centers are closed by homeoffice protection, prospects for future growth anddevelopment of new attractive banking sites arebright.

Although there are other large and capable po-tential entrants into Orange County, RNB's lead-ing position in adjacent Rockland County indi-cates that the proposed merger would have anadverse effect on potential competition in OrangeCounty.

In addition to the possibility of de novo entryinto the service areas of one another, both bankscould expand throughout the district, and comeinto competition with one another, throughmerger with smaller banks in areas in which theydo not now effectively compete.

We conclude that the overall effect of the pro-posed merger on potential competition in varioussections of the Third Bank District of New Yorkwould be adverse.

NEW JERSEY BANK (N.A.), CLIFTON, N.J., AND JERSEY STATE BANK, RIVER EDGE, N.J.


Jersey State Bank, River Edge, N.J., withand New Jersey Bank (National Association), Clifton, NJ . (15709), which had. .merged Feb. 27, 1970, under charter and title of the latter bank (15709). Themerged bank at date of merger had

Total assets

$20,516,992506,259,053

526,776,046

Banking offices

Inoperation

323

To beoperated

26


On November 5, 1969, Jersey State Bank, RiverEdge, N.J., and New Jersey Bank (N.A.), Clifton,N.J. applied to the Comptroller of the Currency forpermission to merge under the charter and with thetitle of the latter.

New Jersey Bank (N.A.), with IPC deposits of$376.7 million, was organized in 1869. It operatesall its 21 offices in the southern section of PassaicCounty. The bank also has one approved but un-opened branch, and one branch application pend-ing. In addition, it has a pending application tomerge with The Peoples National Bank of SussexCounty, Sparta, N.J. The bank is in generallygood condition, having adequate capital, a favora-ble earnings record, and highly regarded manage-ment.

Passaic County is located in the northeastern sec-tion of the State, near New York City. It contains16 municipalities with an estimated population of464,000, making it the sixth most populated of the

21 counties in the State. It ranks as the fourthsmallest county in the State in terms of land area,with only 192 square miles. The three most popu-lated municipalities in the county are Paterson,Clifton, and Passaic, which together comprise theentire southern end of the county, and contain anaggregate population of 294,000. The economy ofthe area is based upon manufacturing, wholesaling,and retailing, much of the area is residential be-cause of the favorable commuting to New Yorkand northern New Jersey commercial centers.

Jersey State Bank, with IPC deposits of $16.8million, was chartered in 1957, and presently oper-ates a branch office in Emerson, N.J., and anotherin River Edge, N.J. The bank, besides having op-erational problems in recent years, has a smalllending limit that has inhibited its ability to serv-ice local businesses' need for larger loans.

The merging Jersey State Bank is located in Ber-gen County, directly across the Hudson Riverfrom New York City. Bergen County has a total

51


land area of 235 square miles, contains 70 munici-palities, and has an estimated population of914,000. The construction of the George Washing-ton Bridge in the 1930's opened up the county as aplace of residence for many New York City work-ers. Bergen County is part of the New York-NewJersey metropolitan area which domiciles many ofthe largest industrial corporations in the UnitedStates. Within Bergen County there are a numberof industrial parks containing many manufacturingand other industrial-type plants.

The overall trade area contains 38 commercialbanks, operating 172 offices, with resources of ap-proximately $3.4 billion, deposits of approximately$3 billion, and loans of approximately $1.8 billion.The numerous commercial banks and other finan-cial institutions located in New York City alsocompete actively for deposits and loans in the Ber-gen County trade area. The overall trade area con-tains 93 savings and loan offices with deposits ofabout $1.3 billion and loans of $1.2 billion. Thereare also numerous mortgage companies, financecompanies, credit unions, and insurance companieswhich compete for deposits and loans within thearea.

This merger would be of particular benefit tothe customers of and the communities in whichthe merging bank operates. It will be the solutionto the successor management problem, and themany operational difficulties which that bank expe-riences. In addition, the merged institution will bebetter able to serve the needs of the customers ofthe Jersey State Bank; the lending limit will in-crease from the present $128,000 for the JerseyState Bank to a $3.9 million limit for the resultinginstitution. New and expanded services will bemade available in the Jersey State Bank servicearea, and will include complete trust services, com-puter services, 5 percent 5- and 8-year savingsbonds, payroll services, a complete internationaldepartment, participation with the Small BusinessAdministration in loans, and highly sophisticatedcommercial finance and installment loan depart-ments.

Competition will not be adversely affected byconsummation of this transaction. Because theservice areas of the merging banks are about 7miles apart, and the intervening area is presentlydensely banked, there is little competition betweenthem. Although in the overall service area onebanking alternative will be eliminated, adequatealternative sources remain. The resulting bank will

be better able to compete with the largest BergenCounty and New York City banks than can themerging bank. In Passaic County, the resultingbank will remain as the largest, but will increaseits lead only by a slight amount. In the newlyformed First Banking District of New Jersey, theresulting bank will rank fifth in size, and will besmaller than 12 of the 37 commercial banks lo-cated in New York City.

It is concluded in the light of the statutory cri-teria, that the merger is in the public interest andit is, therefore, approved.

JANUARY 21, 1970.


The closest offices of the merging banks areabout 10 miles apart, and there are numerous in-tervening banking alternatives. Each bank, how-ever, draws a small amount of deposits from areasserved by the other. It would appear that the pro-posed merger would eliminate only a limitedamount of direct competition.

Under New Jersey law, either bank could opende novo branch offices in the service area of theother, although not in communities subject tohome or branch office protection. As one of thelargest banks in the newly created First BankingDistrict, Clifton Bank has the resources to opende novo offices where legally permissible. WhileParamus and River Edge would appear to beclosed, Clifton Bank could be permitted to opende novo branch offices in other municipalitiesserved by Jersey State. There are a number of otherlikely potential entrants into this area includingthe larger banks headquartered in Bergen Countyitself.

The recent changes in New Jersey law have in-duced substantial merger activity by the largerbanks in the State as part of their market exten-sion programs. We believe that the largest of thesebanks, such as Clifton Bank, should expand intonew areas either through de novo branching or, inthe alternative, through merger with a smallerbank in the area they wish to serve. Such methodsof expansion are desirable from a competitivestandpoint as they preserve leading local banksmost capable of providing competition and mostlikely, through affiliation with one another or inbank holding companies, to be able to providenew competition to the large banks on a broadscale.

While Clifton Bank is one of the largest banks

52


in the State, Jersey State is among the smallestbanks operating offices in central Bergen County,and one of the smallest banks in northeastern New

Jersey. Accordingly, we conclude that the proposedmerger is unlikely to have a significantly adverseeffect on potential competition.

FIRST NATIONAL BANK, BOWLING GREEN, OHIO, AND HARDY BANKING COMPANY, NORTH BALTIMORE, OHIO


Hardy Banking Company, North Baltimore, Ohio, withand First National Bank, Bowling Green, Ohio (15416), which hadmerged Feb. 28, 1970, under charter and title of the latter bank (15416). Themerged bank at date of merger had

Total assets

$4,281,05230,728,502

34,864,742

Banking offices

Inoperation

15

To beoperated

6


On November 4, 1969, the First National Bank,Bowling Green, Ohio, and the Hardy BankingCompany, North Baltimore, Ohio, applied to theOffice of the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of the former.

The First National Bank, the charter bank, wasorganized in 1952 as a State institution and con-verted to a National charter in 1964. This bank,which now has IPC deposits of $22 million, oper-ates its main office in Bowling Green and a branchin each of the towns of Rossford and Northwood,both of which are in the northern part of WoodCounty, near Toledo.

Bowling Green, with a population of 19,000, lies23 miles south of Toledo, and is the county seat ofWood County. This county, together with adjacentportions of Lucas County, constitutes the charterbank's primary service area. This area not onlyencompasses some of the most productive farmland in the State of Ohio, but also includes sub-stantial industrial activity centered around the pro-duction of stone, clay, and glass products, transpor-tation, electrical equipment, and metal and rubberproducts. Bowling Green State University, with anenrollment of 13,000, makes a substantial contribu-tion to the local economy.

The Hardy Banking Company was organized in1896 and continues to operate from a single office.This bank, with IPC deposits of only $3.4 million,has not been an aggressive competitor in the area'sbanking structure. Its size has limited the servicesit has been able to render to its customers.

North Baltimore, a town of 3,000, is also locatedin Wood County, 15 miles south of BowlingGreen. Although this is principally an agricultur-ally oriented community, many of its residentscommute to industrial jobs in Finlay, 9 milessouth.

There is little existing competition between theparticipating banks whose offices are 15 milesapart. Not only does the distance factor minimizethe development of competition between them,but the conservative policies of the merging bankalso militate against it. The size of North Balti-more precludes the receiving bank from seeking ade ?iovo branch in the town; the competitive im-pact of such an entry on the merging bank wouldbe severe.

The operation of the North Baltimore bank as abranch of the receiving bank following the mergerwill offer more effective competition with otherbanks now serving the area. These other banks in-clude The Bank of Wood County Company, Bowl-ing Green, with deposits of $41 million and abranch in North Baltimore; The Cygnet SavingsCompany, Cygnet, Ohio, with deposits of $11 mil-lion; and, the Custar State Bank Co., Custar, Ohio.Several other banks located in Hancock County,just south of North Baltimore, also compete forbusiness in this general area.

When the merger is approved, the banking pub-lic in the service area of the merging bank willbenefit from the expanded range of banking serv-ices made available by the charter bank. Trustservices, a bank credit card, and a greatly ex-panded lending limit will be made availablethrough the charter bank. The increased competi-

53


tion with banks now operating in this area will re-sult in further benefits to the public. In addition,approval of this application will provide manage-ment continuity for the merging bank.

Applying the statutory criteria, we find that theproposal is in the public interest and the applica-tion is, therefore, approved.

JANUARY 22, 1970.


The closest branch of FNB is 14 miles fromHardy Bank, the distance from Bowling Green toNorth Baltimore. There are presently two banksoperating in North Baltimore (population 3,500) :Hardy Bank, and a branch of Wood County Bank.There is one intervening bank between BowlingGreen and North Baltimore located in Cygnet,about 4 miles north of North Baltimore, and 10miles south of Bowling Green. The applicationstates that about 5 percent of FNB's business origi-nates in the North Baltimore service area. Theproposed merger would eliminate some direct com-petition between FNB and Hardy Bank.

Furthermore, since State law permits de novobranching within the county in which the bank islocated, FNB can increase its activity in the south-ern part of the county. It has the resources to dothis, and the fact that it has no branches in thesouthern half of the county means that de novoentry could increase competition in the area. Themerger, therefore, will foreclose the potential forthe development of greater competition betweenthe two banks.

Eleven commercial banks operate in WoodCounty. The four largest banks hold 65 percent ofthe total deposits. As of June 30, 1968, FNB wasthe second largest bank in the county, with about14 percent of total deposits. Hardy Bank, the 10thlargest bank, has about 2.2 percent of total depos-its, and the effect of this merger would be to in-crease countywide concentration by this amount.

Since the proposed acquisition would eliminatesome direct competition, and the potential for in-creased competition, the proposed merger is likelyto have an adverse effect on banking competitionin Wood County.

CENTRAL PENN NATIONAL BANK, BALA-CYNWYD, PA., AND COMMUNITY BANK & TRUST COMPANY, PAOLI, PA.


Community Bank & Trust Company, Paoli, Pa., withand Central Penn National Bank, Bala-Cynwyd, Pa. (723), which hadmerged Mar. 13, 1970, under charter and title of the latter bank (723). Themerged bank at date of merger had

Total assets

$48,912,682444,909,782

488,940,101

Banking offices

Inoperation

725

To beoperated

32


On October 20, 1969, Community Bank & TrustCompany, Paoli, Pa., and Central Penn NationalBank, Bala-Cynwyd, Pa., applied to the Comptrol-ler of the Currency for permission to merge underthe charter and with the title of the latter.

Central Penn National Bank, with IPC depositsof $336.7 million, was chartered originally in 1828.In 1968, the bank relocated its office to Bala-Cyn-wyd, just across the western county line from Phil-adelphia. Relocation of its head office enables thebank to branch into three additional counties,Berks, Chester, and Lehigh. Presently, through abranch system of 24 operating offices, the charterbank serves the city of Philadelphia, lower Bucks

County, and portions of eastern MontgomeryCounty. Three additional branches are in the pro-cess of construction, and one branch application ispending. While the condition of this bank is gen-erally good, its growth has not kept pace with thatof its seven major competitors in the Philadelphiaarea.

The primary service area of the charter bank in-cludes, Philadelphia, Bucks County, and Montgom-ery County. Philadelphia has a population of 2 mil-lion, and the 7-county area in which the charterbank can legally branch has a population of 4.4million people. The economy of this area ismixed, with Philadelphia as the nucleus of amajor industrial complex. The metropolitan area

54


has, in recent years, been spreading; overcrowdedconditions in the city have caused many businessesto move into the outlying suburbs. Much of the7-county area outside the bank's present service areais agriculturally oriented.

Since Central Penn is a Philadelphia-orientedbank, it competes with seven major banks, four ofwhich each have resources of well over $1 billion.Philadelphia and its adjacent counties are servicedby 430 banking offices. In Philadelphia, and the7-county area, there are 645 banking facilities, oper-ated by 59 commercial banks. In 1969, Philadel-phia area deposits increased by an average of 10percent while those of Central Penn increased only1 percent. Numerous other financial institutionsoperate in the area.

Community Bank & Trust Company, with IPCdeposits of $38.6 million, was originally organizedas the Paoli Bank and Trust Company in 1927. Itoperates its six branches, including a drive-in facil-ity, and its main office in Chester County. Thelending limit and services of this bank are not suf-ficient to attract the business of large industries lo-cated in Chester County. Its senior managementlacks successors, and its capital is inadequate topermit the establishment of additional branches.

The service area of the merging bank is primar-ily Chester County which has a population255,000, and an area of 486,400 acres, mostly farmsor undeveloped land. While agriculture is of de-clining importance, industrial growth has beenstrong over the last decade. Some 350 manufactur-ing firms now employ over 30,000 persons. The en-tire work force in the county is in excess of 63,000persons. Mushroom production is most importantto the county's economy, with 80 million poundsproduced annually.

Substantial competition is derived from largeout-of-county based banks, including ContinentalBank and Trust Company, with IPC deposits of$460 million, and four branches in the county; In-dustrial Valley Bank Sc Trust Company, with IPCdeposits of $323 million, and six in-countybranches; and American Bank and Trust Com-pany, with IPC deposits of $405 million, and onein-county branch. The first two of those banks areheadquartered in Montgomery County, while thethird is headquartered in Reading, in BerksCounty. The largest bank headquartered in Ches-ter County is the National Bank of ChesterCounty and Trust Company, West Chester, Pa.,with IPC deposits of $78 million. This bank was

recently granted approval to merge with The Dela-ware County National Bank, Chester, Pa., whichhas IPC deposits of $19 million.

This merger will create a larger institution capa-ble of better serving the combined service area'sneeds for expanded banking services, particularlytrust services and a larger lending limit. In addi-tion, management succession problems in the merg-ing bank will be resolved. The lack of capital thatinhibits the merging bank's growth will be solved.

Actual competition will not be adversely af-fected. Since both banks serve separate and distinctareas, there is no competition between them to beeliminated. The service area of the charter bankwill not be affected since the merger will make ai/2 billion dollar bank only slightly larger. In theservice area of the merging bank, the merger willenable the resulting institution to compete moreeffectively with the several large banks operatingin the area.

Potential competition will not be affected. Be-cause of the relatively high cost of establishing denovo branches in an area about 15 miles fromwhere it does business, it is very unlikely that theapplicant would branch into Chester County incompetition with the merging bank. The mergingbank cannot branch de novo without increasing itscapital and, in any event, would be unlikely tobranch into the highly banked areas where the ap-plicant operates.

Applying the statutory criteria, it is concludedthat this merger is in the public interest. The ap-plication is therefore approved.

FEBRUARY 9, 1970.


All but two of Central Penn's 24 offices are morethan 15 miles from a Community office. There isprobably limited competition between one CentralPenn office, in Montgomery County, and the near-est office of Community, about 3 miles away.

Community, now the second largest commercialbank headquartered in Chester County, holdsabout 13 percent of the total deposits held by allcommercial banking offices in the county. The larg-est bank headquartered in the county, holdingabout 25 percent of total county deposits has re-cently merged with Delaware County NationalBank, headquartered in Delaware County. A totalof 13 banks now operate 41 offices in the county.Three of these are large banks headquartered out-side Chester County.

55


Central Penn is the largest bank not now oper-ating in Chester County which could branch denovo into that county. Only seven other Philadel-phia area banks not now operating in ChesterCounty can branch into the county, and the largestof these holds total deposits of about $62 million.Central Penn recently moved its head office fromdowntown Philadelphia to Montgomery Countyfor the express purpose of expanding throughout awider area. Since 1958, Central Penn has estab-lished eight de novo offices and has received ap-proval to open five more. These facts indicate thatCentral Penn is a likely de novo entrant into Ches-ter County.

There are two banks in neighboring Reading,and two in Lancaster, each with total deposits inexcess of $100 million, that could be consideredpotential de novo entrants into Chester County.Given the strong economic ties between ChesterCounty and the Philadelphia area, however, theseReading and Lancaster banks cannot be consideredas likely to enter Chester County de novo as Cen-tral Penn.

Thus, the merger would combine the most likelyde novo entrant into Chester County with the larg-est independent bank in the county. The effect onpotential competition would be adverse.

VIRGINIA NATIONAL BANK, NORFOLK, V A . , AND THE FIRST NATIONAL BANK OF HARRISONBURG, HARRISONBURG, V A .


The First National Bank of Harrisonburg, Harrisonburg, Va. (1572), withand Virginia National Bank, Norfolk, Va. (9885), which hadmerged Mar. 13, 1970, under charter and title of the latter bank (9885). Themerged bank at date of merger had

Total assets

$39,328,751915,449,691

954,254,957

Banking offices

Inoperation

497

To beoperated

101


On November 20, 1969, The First NationalBank of Harrisonburg, Harrisonburg, Va., and theVirginia National Bank, Norfolk, Va., applied tothe Comptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

Virginia National Bank, with IPC deposits of$656.5 million, presently operates 95 branches andtwo military facilities in communities widely scat-tered throughout the State, and has, in addition,two approved but unopened branches and onebranch application pending. This bank is in soundcondition, well-managed, and profitable.

Although the charter bank competes with otherlarge banking organizations in the State on a state-wide basis, its operations are considerably concen-trated in the central and southeastern sections ofVirginia and the tidewater area surroundingHampton Roads. It has recently entered the Wash-ington suburban area in northern Virginiathrough merger with two smaller banks, one in Ar-lington County, and the other in Prince William

County. Areas served by the charter bank arewidely diversified economically, and include ship-ping, manufacturing, agriculture, and trade.

The charter bank competes at various placeswith every other banking organization of state-wide market significance, as well as with a numberof other banking, and non-bank financial institu-tions in the areas it serves. Its nearest office to themerging bank is in Elkton, some 18 miles east ofHarrisonburg, its only Rockingham County office.

The First National Bank of Harrisonburg, withIPC deposits of $30.4 million, was established in1864. In addition to its head office, it operates twobranches within the city of Harrisonburg. Finan-cial General Corporation of Washington, D.C.,controls 25.7 percent of the outstanding stock ofthe merging bank. This bank has experienced adecreasing share of total local banking deposits inrecent years, from a 47.2 percent share, in 1960,to a 30 percent share as of December 1968. It nowranks as the second largest Harrisonburg bank,whereas it had previously ranked number one.

Harrisonburg, with a population of 13,800, isthe economic hub of the county, and is the largest

56


retail trading center in the Shenandoah Valley be-tween Staunton and Front Royal. Harrisonburgand Rockingham County derive diversified eco-nomic support from agriculture, manufacturing,and wholesale and retail trade. Major farm prod-ucts include apples and poultry, and the largestsingle employer in the county is the poultry pro-cessing industry.

The merging bank competes in Harrisonburgwith the $23.9 million deposit United VirginiaBank/Spotswood, the $17.4 million deposit ValleyNational Bank, and the $40.9 million depositRockingham National Bank, the town's largest.Other banks located in Rockingham County in-clude the $9.4 million deposit The Planters Bankof Bridgewater, the $8.3 million deposit Farmersand Merchants Bank of Timberville, and the $6.8million deposit The First National Bank of Broad-way. In addition to Financial General Corpora-tion, which also owns a controlling interest in Val-ley National Bank, Harrisonburg, two other bankholding companies are represented in the county.These are United Virginia Bankshares, Inc., whichcontrols United Virginia Bank/Spotswood, andFirst Virginia Bankshares Corporation which con-trols Planters Bank of Bridgewater.

This merger will benefit the community of Har-risonburg by introducing an office of a statewideinstitution capable of providing more varied andsophisticated financial services. It will replace theconservative, less aggressive merging bank with aforward-looking institution which should stimulatethe local economy and enable the local office of theresulting institution to retain its proportionateshare of the local banking market.

This merger will have little adverse competitiveeffect. Because the nearest offices of the two institu-tions are 18 miles apart, there is little significantcompetition between them. In Harrisonburg, theactual or potential adverse effect on competitionthat the common ownership of the merging bankand Valley National Bank by Financial GeneralCorporation might have will be eliminated. Theentry of the charter bank into Harrisonburgshould stimulate competition, particularly with re-spect to the large banking organizations now repre-

sented there, and will bring a choice of a broadrange of banking services to the Harrisonburg areaon a more substantially equal competitive basisthan is possible for the merging bank. Potentialcompetition will not be eliminated since thecharter bank is prohibited by State law frombranching de novo into Harrisonburg.

Applying the statutory criteria, it is concludedthat the merger is in the public interest. The ap-plication is, therefore, approved.

FEBRUARY 5, 1970.


All of Harrisonburg Bank's offices are in Harri-sonburg. VNB's closest offices is in Elkton, alsoRockingham County, about 18 miles east of Harri-sonburg. VNB also operates a branch in Shenan-doah, some 5 miles north of Elkton. Three othercommercial banks operate offices in Harrisonburg,but there are no banking alternatives betweenHarrisonburg and Elkton. However, there appearsto be only limited competition existing betweenVNB's Elkton branch and Harrisonburg Bank.The Massanutten Mountains lie between the twocities, and the merging banks derive little businessfrom one another's service area.

VNB's Elkton office holds about 4 percent of thedeposits in commercial banks in RockinghamCounty, while Harrisonburg Bank holds about 25percent of such deposits. After the merger, VNBwould hold the largest share of deposits in Rock-ingham County.

Under Virginia law VNB cannot open de novobranch offices in Rockingham County. Of the fourbanks that operate offices in Harrisonburg, the twosmallest are presently controlled by registered bankholding companies. The two independent banks,Harrisonburg Bank and Rockingham NationalBank, are comparable in size and market position.Thus, there is no present merger path by whichVNB could enter Harrisonburg without acquiringsuch a substantial market position.

The proposed merger would, however, eliminatethe possibility of VNB's entry through establish-ment of a holding company, and acquisition of anewly chartered bank in the area.

57


FIRST NATIONAL BANK IN MOUNT CLEMENS, MOUNT CLEMENS, MICH., AND THE ARMADA STATE BANK, ARMADA, MICH.


The Armada State Bank, Armada, Mich., withand First National Bank in Mount Clemens, Mount Clemens, Mich. (12971),which hadmerged Mar. 18, 1970, under charter and title of the latter bank (12971). Themerged bank at date of merger had

Total assets

$5,983,449

75,588,838

81,827,802

Banking offices

Inoperation

1

3

To beoperated

4


On December 2, 1969, the First National Bankin Mount Clemens, Mount Clemens, Mich., ap-plied to the Comptroller of the Currency for per-mission to merge with The Armada State Bank,Armada, Mich., under the charter and with thetitle of the former.

First National Bank in Mount Clements, thecharter bank, was organized in 1926, and has totalassets of $65 million. This bank operates its mainoffice and two branches in the city of Mount Clem-ens, and an additional banking facility at nearbySelfridge Field Air Force Base.

The Armada State Bank, the merging bank, wasorganized in 1933, and has total assets of $5.4 mil-lion. The merging bank is a unit bank with itsonly office located in the village of Armada, in Ma-comb County.

Macomb County, which is the site of all officesof the participating banks, has been designated bythe United States Bureau of Census as being a partof the Detroit Standard Metropolitan StatisticalArea. Macomb County, located in the southeasternpart of the State, in the lower half of the triangleformed by the cities of Detroit, Flint, and PortHuron, has an area of 481 square miles, and apopulation of approximately 600,000.

Mount Clemens, the location of the charterbank, is 20 miles north of Detroit and has a popula-tion of about 20,000. The city, which was onceconsidered primarily residential, is currently expe-riencing a trend towards industrialization. Coexist-ent with this trend has been the development ofservice-oriented businesses such as shopping cen-ters, restaurants, and motels.

The village of Armada, the site of the mergingbank, is located in the north-central section of Ma-comb County, 37 miles north of Detroit, and 17miles north of Mount Clemens. The economy ofthis community, which has a population of ap-

proximately 1,000, is primarily dependent upon ag-riculture. The merging bank, which upon consum-mation of the proposed merger will operate as abranch of the charter bank, is currently the onlyfinancial institution in Armada.

Consummation of the proposed merger will nothave an adverse effect on competition. In MountClemens, the charter bank competes with the ag-gressive Mount Clemens Savings Bank which hastotal assets of approximately $47 million. Competi-tion is also furnished by Macomb County branchesof the larger Detroit-based banks located close toMount Clemens. Existing competition between theparticipating banks is minimal, both in view of thedistance separating their offices and their relativesize. Potential future competition is effectively pre-cluded by virtue of Michigan's home office protec-tion law.

Consummation of the proposed merger willserve the convenience and needs of the communityof Armada. This merger will increase the locallending limit available to residents of Armada bynearly tenfold. A potential management successionproblem developing at the merging bank will beaverted by this proposal.

Applying the statutory criteria to the proposedmerger, we conclude that it is in the public inter-est and the application is, therefore, approved.

FEBRUARY 9, 1970.


The merger would eliminate some direct compe-tition as no banks are located on the road linkingMount Clemens and Armada; there are, however,alternative banks located closer to Armada than isFirst National. Also four large Detroit banks haveoffices in the southern part of Macomb Countynear Mount Clemens.

Michigan law allows banks to branch anywherewithin the county in which the home office is lo-

58


cated, and also into all counties adjacent to theone in which the home office is located, but onlywithin a 25-mile radius of the home office. How-ever, there is branch and home office protectionbut it is possible for banks to branch into areas ad-

jacent to the protected area and become actualcompetitors. This would eliminate the potentialthat First National would be such an entrant intothe Armada area.

FIRST NATIONAL BANK IN MANSFIELD, MANSFIELD, PA., AND THE CITIZENS NATIONAL BANK, BLOSSBURG, PA.


The Citizens National Bank, Blossburg, Pa. (13381), withand First National Bank in Mansfield, Mansfield, Pa. (13618), which hadmerged Mar. 31, 1970, under charter of the latter bank (13618) and title "FirstCitizens National Bank." The merged bank at date of merger had

Total assets

$5,409,06911,901,611

17,320,680

Banking offices

Inoperation

11

To beoperated

2


On October 22, 1969, The Citizens NationalBank, Blossburg, Pa., and the First National Bankin Mansfield, Mansfield, Pa., applied to the Comp-troller of the Currency for permission to mergeunder the charter of the latter and with the titleof "First Citizens National Bank."

The Citizens National Bank, Blossburg, Pa., themerging bank, is a unit bank with IPC deposits of$4.5 million. It was chartered in 1929, and hasnever been involved in a merger or similar transac-tion. The bank's primary service area includes theborough of Blossburg, and an area 5 miles northof Blossburg.

Blossburg, situs of the merging bank, is a townof 1,956 persons, located 10 miles south of Mans-field, Pa., in southwestern Tioga County. The townlies in a small valley completely surrounded byhills and dense forests. The primary industries arethe Blossburg State Hospital, two casting foundar-ies, and a wooden pallet manufacturer. Area busi-nesses employ about 700 persons, with the found-ries alone employing 450 persons and having anannual payroll of $2.75 million. A significant num-ber of people commute to Elmira, Painted Post,and Corning, N.Y. for work. Mining and coaltransportation are also important to the Blossburgeconomy, contributing $4 million annually to thepayrolls.

The First National Bank in Mansfield, organizedin 1932, has IPC deposits of $8.4 million. It oper-

ates a single office and has never been involved ina merger or similar transaction. The service area ofthe applicant includes the borough of Mansfieldand an area 5 miles south of Mansfield, as far asthe township of Covington.

Mansfield is located in the eastern portion ofTioga County at the intersections of U.S. Routes 6and 15. The terrain is mountainous and denselyforested. As industry is nonexistant, the economyof the area is dominated by dairy farming. Mans-field is the site of Mansfield State College, whichhas a faculty numbering 230, and an administrativeand service staff of 244. Its budget for 1969 was inexcess of $7 million.

The merger will eliminate an insignificantamount of competition between the applicantbanks. Their service areas overlap only aroundCovington Township. Approximately 300 deposi-tors of the participating banks come from the Cov-ington Township area, but only 60 of these haveaccounts in both banks. While the banks are only10 miles apart, and have a potential for increasedcompetition, this is not expected due to the smallpopulation to be served and the existence of otherarea bank offices between and around the two sub-ject institutions.

There are two other banks operating in TiogaCounty: The Commonwealth Bank and TrustCompany, Muncy, Pa., with deposits of $26.8 mil-lion; and the Northern National Bank and TrustCompany, Wellsboro, Pa., with deposits of $22.9

59


million. The Commonwealth Bank and Trust is avery aggressive institution with three branches inTioga County, and the Northern National Bankand Trust has four branches in addition to itshead office at Wellsboro. These two banks, respec-tively, hold 42 and 36 percent of Tioga County'stotal deposits of $63 million. Presently, the charterbank is the third largest of the four county banks,holding 14.3 percent of the deposits, while themerging bank is the smallest of the four countybanks, holding 7.6 percent of the deposits. Whenthis merger is consummated, the resulting bankwill still be third in size, with 21.9 percent of thedeposits. Although this places the resulting bankshort of the deposits of the other two banks, itshould create a stronger, more viable institution,capable of effectively competing with the twolarger banks.

Additional competition is experienced frombanks in neighboring cities around Tioga County:The First National Bank of Troy, Troy, Pa.; TheFirst National Bank of Ralston, Ralston, Pa.; andthe First National Bank of Canton, Canton, Pa.Although Elmira, N.Y. lies 30 miles northeast ofMansfield several commercial and savings banksfrom that city advertise in the local newspaperdelivered in Mansfield and Blossburg. There areno savings and loan associations or mutual banks inthe resulting bank's trade area.

The union of these two institutions will provideseveral beneficial results to the merging bank andits customers. The statutory lending limit of theresulting bank will be $100,000, which will allow it

to meet the expanding credit needs of local busi-nessmen. Off-premise computer services will be ini-tiated, and a full-time trust department will be in-stituted. The merger is expected to solve thepersonnel problems that beleaguer all small banks,because increased salary scales, medical services,and pension programs can be offered to attractprospective and present personnel.

Applying the statutory criteria to the proposedmerger, we find it is in the public interest and theapplication is therefore approved.

JANUARY 14, 1970.


The merging banks are located in small com-munities approximately 10 miles apart. There areno other banks in either community nor in the in-tervening area. It would appear that the proposedmerger would eliminate some direct competitionbetween the merging banks.

Seven commercial banks operate a total of 10banking offices in the service area of the resultingbank, which encompasses the eastern half of TiogaCounty, a western portion of Bradford County,and part of northern Lycoming County. First Na-tional and Citizens hold about 12 percent and 6percent, respectively, of the total deposits in thesebanking offices. These figures may understate thecompetitive effects of the proposed merger as FirstNational and Citizens both lie near the center ofthe area in question.

We conclude that the proposed merger may havean adverse effect on competition.

WELLS FARGO BANK, N.A., SAN FRANCISCO, CALIF., AND LOS PADRES NATIONAL BANK, SANTA MARIA, CALIF.


Los Padres National Bank, Santa Maria, Calif. (15271), withand Wells Fargo Bank, National Association, San Francisco, Calif. (15660),which hadmerged Apr. 10, 1970, under charter and title of the latter bank (15660). Themerged bank at date of merger had

Total assets

$12,438,566

5,436,787,409

5,449,225,975

Banking offices

Inoperation

2

268

To beoperated

270


On December 29, 1969, the Los Padres NationalBank, Santa Maria, Calif., and the Wells FargoBank, N.A., San Francisco, Calif., applied to the

Comptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

Wells Fargo Bank, N.A., with resources of $5.5

60


billion, is headquartered in San Francisco. Thisbank, which operates most of its 267 branches inNorthern California, has recently started to ex-pand into Southern California through de novooffices, and by mergers.

The merging Los Padres National Bank openedits main office in Santa Maria in 1964. It now op-erates one branch 6 miles south of the main office.Through both offices, this bank has generated de-posits of $9.8 million.

The economy of the area served by Wells FargoBank is fully diversified in agriculture, industry,finance, lumbering, fishing, tourism, mining, oilproduction, military establishments, and manycommercial and service activities. The mergingbank serves the city of Santa Maria, Calif., whichhas a population of approximately 34,000, and thesurrounding area, encompassing the northern sec-tion of Santa Barbara County. The economy ofthis area is based on agriculture, with emphasis onthe growing of vegetables, berries, and flowers, aswell as dairy farming, and poultry and livestockraising. Oil production also comprises an impor-tant segment of the economy.

Although Wells Fargo Bank, as the third largestbank in the State, competes with numerous officesof statewide, regional, and local banks, it does notcompete with the merging bank. The offices of thecharter bank nearest to the merging bank are lo-cated in Ventura, 104 miles southeast; in Bakers-field, 127 miles east; and in King City, 109 milesnorth.

The merging bank presently competes with fourof the five largest banks in the State of California.Within its service area, the Bank of America, withdeposits of $21.9 billion, operates two offices; Secu-rity Pacific National Bank, with deposits of $5.7billion, operates two offices; and United CaliforniaBank, with deposits of $4.3 billion, and CrockerCitizens National Bank, with deposits of $4.3 bil-lion, operate one office each. Consummation of thismerger will not put undue competitive pressureupon any of these competing banks serving thearea. It will, in fact, introduce the third largestbank in the State into an area already being servedby four of the five largest banks in the State. Com-petition is also offered in the service area by sev-eral savings and loan associations, credit unions,sales finance companies, personal loan companies,and mortgage companies.

The merger will provide the customers of the

merging bank with another alternate source of ex-tended customer service in Santa Maria and north-ern Santa Barbara County. The increased competi-tion of these large banks will redound to thebenefit of area residents.

Applying the statutory criteria, it is concludedthat the proposed merger is in the public interestand the application is, therefore, approved.

MARCH 4, 1970.


Wells Fargo has no offices in the Santa Mariaarea; its nearest branches are over 100 miles fromLos Padres' offices. The applicants derive a few de-posit accounts from each other's areas. Theamounts, however, are minor and the areas arealso served by a number of other large Californiabanking institutions. The direct competition thatwill be eliminated by the proposed merger is insig-nificant.

Wells Fargo is the only one of the five largebanks that dominate California banking that doesnot serve the Santa Maria area. Given the signifi-cant growth record of this area, Wells Fargo's in-terest in expanding into growing markets in south-ern California, and its capacity to expand by denovo branching through opening multiplebranches at one time, it follows that Wells Fargo isthe most likely de novo entrant into the SantaMaria area.

Santa Maria is a highly concentrated bankingarea. It is served by only five banks; four of theseare major statewide banking organizations whilethe fifth is Los Padres, the only independent bankin the market. In spite of being a new independ-ent bank in a market dominated by the largestbanks in the State, Los Padres had, as of June 29,1968, 15 percent of commercial bank deposits, and10 percent of IPC demand deposits held in bank-ing offices in the Santa Maria area. It ranked asthe third largest in terms of both total depositsand IPC demand deposits in bank offices in SantaMaria.

This merger will eliminate the only independentbank in this market, give the third largest bank inthe State the third largest market position in theSanta Maria area, and eliminate permanently itsability to enter this area de novo and increase com-petition. The result will be elimination of poten-tial competition, entrenchment of a concentratedbanking structure, and the elimination of the di-

61


versity that comes from having banks of varied size The effect of this merger on competition will beserving a particular market. adverse.

FIRST NATIONAL BANK IN MANSFIELD, MANSFIELD, LA., AND BANK OF GRAND CANE, GRAND CANE, LA.


Bank of Grand Cane, Grand Cane, La., withwas purchased Apr. 11, 1970, by First National Bank in Mansfield, Mansfield,La. (11669), which hadAfter the purchase was effected, the receiving bank had

Total assets

$423,758

15,574,13015,997,888

Banking offices

Inoperation

1

1

To beoperated

2


On November 19, 1969, the First National Bankin Mansfield, Mansfield, La., applied to the Comp-troller of the Currency for permission to purchasethe assets and assume the liabilities of the Bank ofGrand Cane, Grand Cane, La., under the charterand with the title of the former.

The First National Bank in Mansfield is head-quartered in Mansfield, La., and operates as a unitbank. This bank, with total resources of $14.8 mil-lion, and IPC deposits of $11.5 million, was estab-lished in 1920. The Bank of Grand Cane, theselling bank, headquartered in Grand Cane, La.,has total resources of $511,000, and IPC deposits of$444,000, only $1,000 of which are in savings andtime deposits.

Both banks are located in DeSoto Parish, whichhas an economy dependent on agriculture with oilproduction and timber processing offering some di-versification. Since Mansfield is near the geo-graphic center of the parish and serves it as a tradecenter, the applicant has customers from through-out the parish. The population of Mansfield, 6,000persons, constitutes approximately one-quarter ofthe total population of the parish. Grand Cane, 8miles north of Mansfield, has a population of ap-proximately 400 persons. The selling bank drawsmost of its customers from the town and the sur-rounding farm area.

Primary competition for the applicant comesfrom the Mansfield Bank and Trust Company,Mansfield La., with total assets of $8.2 million, andthe DeSoto Federal Savings and Loan Association,Mansfield, La., with total assets of $10 million.There are two other banks located in the parish,

the Bank of Logansport, Logansport, La., withtotal assets of $4.6 million, and the Pelican StateBank, some 16 miles southeast of Mansfield in anunincorporated community, with total assets of ap-proximately $1.5 million. The latter bank has ap-plied for permission to move its main office toMansfield. The offices of three finance companiesare also located in Mansfield, each with outstand-ing loans of approximately $100,000. There shouldbe no significant change in the relative competitivepositions of these institutions and the applicantupon consummation of the proposed transaction.

The selling bank and the buying bank do notcompete to any significant extent since the manage-ment of the selling bank has followed a conserva-tive policy concerning loans, savings deposits, andbank services in general, thereby offering little ifany competition to other financial institutions. Itis obvious from the fact that there are only $1,000in time and savings deposits in the selling bankthat this bank offers no competition for suchfunds. Also, a lending limit of only $6,000 limitsany competition in the lending area. The purchaseof this small and unaggressive bank by the larger,more aggressive, and growing bank would be ofmaterial benefit to the banking public of GrandCane. All significant banking services would beavailable at a local branch, including a muchlarger lending limit to satisfy the needs of thelarger farming operations in the area.

Applying the statutory criteria it is concludedthat the proposed purchase and assumption is inthe public interest and the application is, there-fore, approved.

JANUARY 30, 1970.

62



Grand Cane Bank and First National each oper-ates a single office, one in the town of Grand Cane(population 400) and the other in the town ofMansfield (population 6,000), 6 miles apart, inmid-DeSoto Parish, in the northeastern part ofLouisiana.

Since First National regards the entire parish asits service area, it is clear that this merger willeliminate direct competition between the mergingbanks; however the limited activity of the Grand

Cane Bank at present suggests that the loss of com-petition may not be as substantial as might other-wise appear. First National, on the other hand, isthe largest of the five banks presently serving theparish, and has nearly 50 percent of all commercialbank deposits. While this acquisition will not sub-stantially increase that share, it will eliminate thepossibility that Grand Cane Bank would combinewith one of the smaller banks in the county to cre-ate a more substantial competitor better able tocompete with First National.

T H E CONNECTICUT NATIONAL BANK, BRIDGEPORT, CONN., AND ATLANTIC NATIONAL BANK, STAMFORD, CONN.


Atlantic National Bank, Stamford, Conn. (15584), withand The Connecticut National Bank, Bridgeport, Conn. (335), which hadmerged Apr. 17, 1970, under charter and title of the latter bank (335). Themerged bank at date of merger had

Total assets

$19,569,744360,808,344

380,378,088

Banking offices

Inoperation

444

To beoperated

48


On December 8, 1969, The Connecticut Na-tional Bank, Bridgeport, Conn., applied to theComptroller of the Currency for permission tomerge with Atlantic National Bank, Stamford,Conn., under the charter and with the title of theformer.

Connecticut National Bank, the charter bank,was organized in 1806 as the Bridgeport Bank, aState-chartered bank and trust company. In 1865,it converted into a National bank, and, in 1955, as-sumed its present name. As of January 30, 1969, itwas the fourth largest commercial bank in theState, with total assets of $356.8 million.

The charter bank operates 42 branches locatedin the southern and western parts of Connecticutincluding several branches in Bridgeport, the Wat-erbury area, and northern Fairfield County. Of thebranches located outside of Bridgeport, 12 arewithin 10 miles of the city, and 13 are over 20miles away, the farthest located in Wolcott, 36miles distant.

The economies of the towns served by thecharter bank vary. Bridgeport is Connecticut'sleading manufacturing center, with transportationequipment, electrical equipment, and fabricatedmetals as the principal industries. It is also an im-

portant retail and wholesale trade center. Al-though Bridgeport's present population of 154,000has decreased slightly since 1960, population in theoutlying suburbs has increased during the same pe-riod.

The charter bank has offices in Danbury andWaterbury, north of Bridgeport. These towns, likeBridgeport, have economies dependent on manu-facturing industries. To the south of Bridgeport,the charter bank has offices in the towns of Darienand New Canaan. These towns, which border onStamford, are affluent commuter towns for NewYork City.

Atlantic National Bank, the merging bank, wasorganized on December 30, 1919, as the ItalianLoan and Brokerage Association. In 1926, it be-came a State-chartered industrial bank known asthe Italian Loan Association. That name waschanged in 1940 to the Atlantic Industrial Bank ofStamford. On April 29, 1966, it converted to aNational charter and assumed its present name. Asof June 30, 1969, the charter bank, which is thesmallest commercial bank in Stamford, had totalassets of $18 million and operated three branchesall within the city of Stamford.

Stamford is located 36 miles east of New YorkCity and 22 miles west of Bridgeport. With a popu-

63


lation of approximately 112,000, it is the secondlargest city in Fairfield County, and the fourthlargest in Connecticut. Of the four largest cities,Stamford alone experienced a population increasein the period 1950-1967, increasing 46 percent.Growth in recent years is attributable to the influxof major corporate research laboratories and thereorganization of several major corporate headquar-ters in the Stamford area. The economy of thearea is diversified. Presently 36 percent of theworkers in the Stamford labor market are em-ployed in manufacturing industries, as comparedto 51 percent in the Bridgeport market. The largestindustry groups are heavy machinery, electricalequipment, chemicals, and printing. The averageweekly manufacturing wage in early 1969 was$142. The Stamford area also serves as a major re-gional shopping center. Three large branches ofmajor New York department stores are locatedthere: Bloomingdale's, Gimbels, and Lord & Tay-lor.

Competition between the charter and the merg-ing banks is minimal. The closest branches of thecharter bank are the Darien and New Canaanbranches which are located 5 and 6 miles respec-tively from the head office of the merging bank.Notwithstanding their proximity to Stamford, only5.4 percent of their total demand and savings bal-ances are attributable to customers with Stamfordaddresses.

Consummation of the proposed merger shouldenhance future banking competition in the Stam-ford area. Under Connecticut's home office protec-tion statute the charter bank could not establish ade novo bank in Stamford. The effect of the pro-posed merger will be to substitute branches of alarge aggressive bank for a bank with limited com-petitive capacity.

Consummation of the proposed merger willserve the convenience and needs of the Stamfordcommunity. Present customers of the merging bankwill be benefited by having their checking accounts

computerized. Additionally, the charter bank willprovide a qualified and experienced trust depart-ment, the services of a well-developed commercialcredit department, a vastly increased lending limit,and other services not now available to customersof the merging bank.

Applying the statutory criteria to the proposedmerger, we conclude that it is in the public interestand the application is, therefore, approved.

MARCH 3, 1970.


The proposal would merge Atlantic Bank (totaldeposits $16.1 million) into CNB, Connecticut'sfourth largest bank.

A distance of about 22 miles separates the headoffices of the merging banks. However, CNB hasbranch offices in New Canaan and Darien 6 and 5miles, respectively, from Atlantic Bank's headoffice. It appears that substantial numbers of NewCanaan and Darien residents work in Stamford; al-though several banks operate offices in the inter-vening areas, Atlantic Bank and the New Canaanand Darien offices of CNB derive some amount ofbusiness from the areas immediately served by eachother. At least some direct competition exists; thiscompetition will, of course, be permanently elimi-nated by consummation of the proposed merger.

Connecticut law does not permit commercialbanks to branch de novo into townships in whichthere are already located the home offices of otherbanks. Under this law, Stamford is closed to denovo branching by CNB. However, Atlantic Bankmight be permitted to establish de novo branchesin New Canaan and Darien.

Commercial banking in the Stamford-New Ca-naan-Darien market is highly concentrated. As ofJune 30, 1968, six banks operated offices in thisarea with total deposits of about $335 million. Thetop three banks held about 87 percent of these de-posits. Atlantic Bank had about 3.4 percent, andCNB had less than 1 percent of these deposits.

64


FIRST NATIONAL BANK OF LINCOLNTON, LINCOLNTON, N.G., AND T H E FIRST NATIONAL BANK OF MOORESVILLE,MOORESVILLE, N.G.


T h e First National Bank of Mooresville, Mooresville, N.G. (9531) , withand First Nat ional Bank of Lincolnton, Lincolnton, N.G. (6744) , which h a d . . . .merged Apr. 30, 1970, under charter of the latter bank (6744) and title "CarolinaFirst National Bank." T h e merged bank at date of merger had

Total assets

$11,138,42721,496,891

32,635,318

Banking offices

Inoperation

34

To beoperated

7


On January 13, 1970, The First National Bankof Mooresville, Mooresville, N.C., and First Na-tional Bank of Lincolnton, Lincolnton, N.C., ap-plied to the Comptroller of the Currency for per-mission to merge under the charter of the latterbank and with the title "Carolina First NationalBank."

The First National Bank of Lincolnton, withIPC deposits, of $14.8 million, was chartered in1903, and presently operates through its head officein Lincolnton, and branch offices in Lincolnton,Denver, and Cherryville. Competition in Lin-colnton derives primarily from a branch of the$600 million First Citizens Bank and Trust Com-pany, the fourth largest bank in the State. In Cher-ryville, the bank competes with the $7 millionCherryville National Bank. Lincolnton is locatedonly 35 miles northwest of Charlotte, bringingthe charter bank under the competitive influence ofthe five largest banks in the State, each of whichhas offices there.

Lincolnton, with a population of approximately5,900, is the largest community in, and the countyseat of, Lincoln County. Textile manufacturing isthe most significant contributor to the local econ-omy with practically 50 percent of all manufactur-ing jobs available in that one industry. Othermajor employers include paper manufacturing,apple processing, wood products production, andfurniture manufacturing.

The First National Bank of Mooresville, withIPC deposits of $7.9 million, was organized in1900. In addition to its main office, it operates twobranches within the city limits of Mooresville. Thisbank is not a full-service institution as it has notrust department. In addition, it has a seriousmanagement succession problem. Competition forthe bank is derived from a local office of the $15million Piedmont Bank and Trust Company, head-

quartered in nearby Davidson. It is also in directcompetition with the $14 million Mooresville Fed-eral Savings and Loan Association and the $6 mil-lion Citizens Savings and Loan Association. TheMooresville Bank, like the Lincolnton Bank, isalso under the competitive influence of largerCharlotte-based banks. In addition to their officesin Charlotte, the North Carolina National Bank,First Union National Bank, and the NorthwesternBank all have offices in Statesville, about 15 milesnorth of Mooresville.

Mooresville, home of the merging bank, with apopulation of approximately 9,200, is located inIredell County which adjoins Lincoln Countyalong its eastern boundary. The county populationhas shown a steady increase and future expansionis predicted. Mooresville is in the southern portionof the county, approximately 25 miles from Char-lotte. Lake Norman, the largest lake in North Car-olina, borders the town on the west and acts as anatural barrier between Iredell and Lincoln coun-ties. The economy of Mooresville is primarilybased on the textile industry.

This merger will make available in the Moores-ville area a broader range of banking services thanthe merging institution presently possesses. In addi-tion, the merger will be the solution to the mergingbank's management succession problem. A largerlimit should be of benefit to the customers of bothbanks, particularly customers in the Mooresvillearea where future economic and population growthare forecast.

Competition will not be adversely affected as aresult of this merger. The service areas of the twobanks do not overlap, the head offices being 25miles apart, and their closest offices some 15 milesapart, with Lake Norman lying between them.There is, therefore, little if any competition to beeliminated. In the Lincolnton area, the mergerwill have little if any affect other than to enable

65


the resulting bank to be a slightly more effectivecompetitor to the much larger First Citizens Bankand Trust Company. In Mooresville, the merger,rather than adversely affecting competition, willenhance competition for available trust business.In the overall service area of the resulting bank,the merger will create an institution more capableof resisting the incursions of the large Charlotte-based statewide banks. Although both participat-ing banks can legally branch de novo into the serv-ice area of the other, this method of growth doesnot appear to be feasible for them.

Applying the statutory criteria to this applica-tion, it is concluded that the merger is in the pub-lic interest. The application is, therefore, ap-proved.

MARCH 12, 1970.


Lincolnton Bank's Denver office, the officenearest to Mooresville, is about 12 miles west ofMooresville across Lake Norman, the State's largestlake. There is one competing banking office inMooresville, but none in Denver. Neither mergingbank derives significant business from the areaserved by the other. Therefore, the proposed mergerwould not appear to have an adverse effect uponany actual competition.

Either merging bank could legally branch denovo into the area served by the other. However,several of the largest banks in North Carolina haveoffices nearby and appear more likely potential en-trants. Therefore, the proposed merger would notappear to eliminate a significant potential com-petitor.

OLD NATIONAL BANK OF WASHINGTON, SPOKANE, WASH., AND COMMERCIAL BANK OF WASHINGTON, TWISP, WASH.


Commercial Bank of Washington, Twisp, Wash., withand Old National Bank of Washington, Spokane, Spokane, Wash., (4668),which hadmerged Apr. 30, 1970, under charter of the latter bank (4668) and title "OldNational Bank of Washington." The merged bank at date of merger had

Total

$5,

291,

298,

assets

495

760

144

,805

,801

,823

Banking offices

Inoperation

2

38

To beoperated

40


On December 5, 1969, the Old National Bank ofWashington, Spokane, Wash., with deposits ol$262.7 million, and the Commercial Bank of Wash-ington, Twisp, Wash., with deposits of $5.2 millionapplied to the Office of the Comptroller of theCurrency for permission to merge under thecharter and with the title of the former.

Old National Bank of Washington, organized in1891, and headquartered in Spokane, Wash., hasIPC deposits of $242.8 million, and offers itscustomers full commercial banking services includ-ing a trust department. The charter bank has 38offices operating in nine counties in eastern Wash-ington; it has received permission to open threeadditional offices. It is a subsidiary of WashingtonBancshares, Inc., a registered bank holding com-pany which controls the $35 million First NationalBank in Spokane and owns 5 percent or less of thestocks of Security Bank of Washington, Ephrata,

Wash.; Valley Commercial Bank, Clarkston, Wash.;Bank of Yakima, Yakima, Wash.; and the North-east Bank, Seattle, Wash.

Spokane, with a population approximating188,500, is the second largest city in Washington,and is situated 285 miles east of Seattle and 17miles west of the Idaho State line. For reasons ofsize and location, it is considered the capital of the"Inland Empire", a region that includes a largepart of eastern Washington, northern Idaho, andwestern Montana. The economy of the region islargely dependent on agriculture, lumbering, andmining, with manufacturing, transportation, andmilitary businesses registering a significant second-ary impact on the income of the area. Manufactur-ing has increased in the last decade; at the time ofapplication the Spokane area had approximately350 manufacturing plants which employed approx-imately 13,000 people.

The Commercial Bank of Washington, organized

66


1909, is the only commercial financial institutionheadquartered in Twisp, Wash. The bank recordsIPC deposits of $3.7 million in its main office andsingle branch at Pateros, Wash.

Twisp is a rural town of 766 people in Okano-gan County. Lumbering is the primary industry ofthe county, with apples, farming, and tourism hav-ing considerable impact on the economy. Whiletourism and recreation are seasonal industries,their importance has been increasing with the com-pletion of the North Cross Highway and the exten-sion of North Cascades National Park southwardto within a few miles of the merging bank's servicearea. Tourism is expected to increase to the benefitof the area's economy.

No competition exists between the applicant in-stitutions. The Pateros branch of the merging bankand the Davenport branch of the charter bank arethe closest facilities of the applicants and they areapproximately 100 miles apart. In addition, fiveoffices of competitor banks intervene between thetwo service areas. The potential for competition be-tween the applicants is remote, State statutes re-strict de novo branching of a bank across countylines to those incorporated communities that haveno banking offices. There are only four incorpo-rated, non-banked, communities in OkanoganCounty, and each has a population of less than 400.Consequently, none are sufficiently large to be con-sidered as potential branch locations at this time.While there are a number of larger towns, they arealready adequately serviced by branch banks ormain offices of competitive institutions.

The banking structure of the merging bank'strade area is adequate and it will not be adverselyaffected by consummation of the merger. In addi-tion to the merging bank, Twisp and Pateros areserved by four banks including the $1.9 billionSeattle-First National Bank and the $1.2 billionNational Bank of Commerce, two of the State'slargest. Seattle-First National Bank has branches atChelan, Okanogan, and Omak, which together havedeposits of $25 million. The National Bank ofCommerce of Seattle retains $6.5 million in depositsat its Brewster branch. The other two banks, Cen-tral Washington Bank in Chelan, and Farmers StateBank in Winthrop, aggregately have deposits ofless than $2 million. In relation to these institu-tions, the resulting bank will have combined de-posits of $5.2 million at the Twisp and Paterosbranches. The merger will introduce the full serv-

ices of the Old National Bank of Washington whichcan be expected to intensify competition for thedeposit business which now gravitates to the marketarea's two largest banks, viz. Seattle-First Nationaland the National Bank of Commerce of Seattle.

The convenience of the proposed merger to thepublic will be substantial. The management succes-sion dilemma that is imminent in the merging in-stitution will be solved through the present staff ofthe charter bank and the management trainingprogram which the charter bank presently main-tains to meet its needs. The charter bank will pro-vide trust and agricultural services, neither of whichare available to the merging bank's customers, butwhich are offered by branches of the two largeSeattle banks. The merger will greatly increase thelending limit of the merging institution which atthe time of application was $67,000. The largerlending limit, plus the ability to transfer fundsfrom the charter bank to the Twisp-Pateros serv-ice area without seeking participations, will benefitthe merging bank's trade area.

Applying the statutory criteria to the proposedmerger, we find that it is in the public interest. Theapplication is, therefore, approved.

MARCH 23, 1970.


Old National, the largest bank in eastern Wash-ington, is the fifth largest bank in the State. Itsnearest branches to Twisp and Pateros are locatedmore than 80 miles away in other counties.

The merger will not eliminate any significantcompetition between the two banks. The mergerwill bring about direct competition between OldNational and two big Seattle-based banks that nowhave branches in Okanogan County.

Under Washington law, the entry of another bankinto either Twisp or Pateros by de novo branchingis prohibited. Remington Rev. Wash. Stat. 30.40.020. Hence, a bank not presently serving this areacan enter only by acquiring an existing bank oropening an office in a community which presentlyhas no bank office. Old National has the size andinterest to use the latter method. The merger will,therefore, make entry by other smaller banks notpresently serving the Twisp and Pateros areas moredifficult.

Of the six banks which serve Okanogan County,Commercial Bank is the fifth largest in terms ofdeposits in banking offices in Okanogan County. It

67


is also the third largest of four independent, localbanks in that county. This merger will, therefore,

not foreclose the possibility of entry by other banksinto the county, as a whole, through acquisition.

SOUTH JERSEY NATIONAL BANK, GAMDEN, N J., AND UNION NATIONAL BANK AND TRUST COMPANY, MOUNT HOLLY, N J .


Union National Bank and Trust Company, Mount Holly, N J . (2343), w i t h . . . .and South Jersey National Bank, Camden, N J . (1209), which hadmerged Apr. 30, 1970, under charter and title of the latter bank (1209). Themerged bank at date of merger had

Total assets

$34,499,979305,339,193

339,637,141

Banking offices

Inoperation

427

To beoperated

31


On October 27, 1969, the South Jersey NationalBank, Camden, N.J., applied to the Office of theComptroller of the Currency for permission tomerge with the Union National Bank and TrustCompany, Mount Holly, N.J., under the charterand with the title of the former.

The South Jersey National Bank was charteredas a State institution in 1812, and converted toNational bank status in 1865. An aggressive com-petitor in the Philadelphia-Camden area, the bankreports IPC deposits of $211.5 million, and operates21 branch offices. It has seven approved but un-opened branches, and one application pending. Itis one of the two banks in the United States whichis permitted to maintain a branch facility in a Stateother than the one in which it is headquartered;it has had an office in Philadelphia, Pa., since 1813.The applicant has become a recognized specialistin construction loan services, which it offers inaddition to the other normal activities of a full-service commercial bank.

The Union National Bank and Trust Company,with IPC deposits of $25.3 million, is headquar-tered in Mount Holly, NJ. Chartered in 1871 as aState bank, it converted to National bank status in1876, and has retained its National charter sincethat time. This bank operates three branch offices;in addition, it has an application pending for abranch in Hainesport Township, several miles westof Mount Holly. While the bank is now managedby knowledgeable and competent personnel, it hasa management succession problem which is ex-pected to become acute in the next 5 years. Thepresident is of retirement age, and the executive

vice president-cashier has announced plans to retirewithin the next 2 or 3 years.

Camden, headquarters for the applicant bank, isthe county seat and hub city for Camden County,a populous county in southern New Jersey. Thecity has a population of 116,000, supported by re-tail, manufacturing, and commercial facilities bothin the city and in nearby Philadelphia. The bank-ing structure in Camden and western CamdenCounty is well developed, with several large banksand numerous branch facilities.

Mount Holly, situs of the merging bank, is lo-cated in Burlington County, approximately 20 milesnortheast of Camden. The city, which now has ap-proximately 15,000 residents, is expected to increasegreatly with the continuing development of Bur-lington County. In the last 5 years, Union NationalBank and Trust's service area population has in-creased from 35,000 to about 68,000 people, and,in the same period, Burlington County's popula-tion has increased from 250,000 to 355,000. Muchof the county is yet undeveloped owing to its agri-cultural heritage. It is that abundance of open landthat is attracting new industry and stimulating thegrowth of the county, particularly in the mergingbank's trade area. Further economic stimulation inwestern Burlington County is derived from theproximity of Fort Dix and McGuire Air Force Base,and the large numbers of military and civilian per-sonnel associated with these facilities. The MountHolly area is served by two commercial banks otherthan the merging bank: The Burlington CountyTrust Company of Moorestown, the largest bankin Burlington County, which has assets in excessof $73 million, has a branch in Mount Holly andtwo branches within 4 miles; and the $57 million

68


Mechanics National Bank of Burlington Countywhich has three branches within 6 miles of themerging bank's offices.

The entire western portion of southern NewJersey, which includes Camden, Gloucester, andBurlington counties, is now undergoing a vasttransformation from a predominantly agriculturalenvironment to a highly developed industrial andresidential area situated in the megalopolis thatstretches from Boston, Mass., to Washington, D.C.Transportation facilities are excellent as all majormediums—highway, air, rail, and water—now servethe area. Business interests are attracted because ofthe availability of land and labor, and the strategiclocation of the area in the center of the easternmarkets. The area also affords relatively easy accessto the midwest and south-central States. Among thelargest employers are R.C.A., Owens Corning Fiber-glass, New Jersey Telephone Company, C.F.&.I.Steel Corporation, Colorado Fuel and Iron Com-pany, plus numerous electronic, chemical, and ma-chinery producing plants.

Competition between the applicant institutionsis insignificant. Prior to July 17, 1969, New Jerseybanking law forbade a bank from branching in anycounty other than the one in which it maintainedits head office. Since each applicant bank resided ina different county, each was effectively isolatedfrom the other's market area. Distance also worksto reduce competition; the main offices of the banksare 20 miles apart, and South Jersey's nearestbranch is 12 miles from Mount Holly. Competitorbanks located between the two banks effectivelyseparate them. No less than 11 of Burlington Coun-ty's 14 banks have 30 offices closer to, and between,Mount Holly and South Jersey National Bank'snearest offices. In addition, competitor institutionsin Camden County operate some six branches be-tween the applicants. As a result, the amount ofoverlapping deposit and loan business betweenthese banks is minute.

The revision of the New Jersey branch laws onJuly 17, 1969, now permits all banks in a designateddistrict to branch de novo under limited circum-stances, throughout the district. Both applicants arein the Third Banking District; however, de novobranching into the other's trade area by either in-stitution is unlikely. Suitable sites are hard to findbecause of the "home office" protection rule andthe pending applications of competitor institutionsfor branches into presently unbanked or underserv-iced areas. For Union National Bank, the expense

of de novo branching into South Jersey's marketarea is prohibitive because its capital resources arealready thin in relation to its deposit size, and itdoes not have the depth in management to staffnew offices.

Approval of the proposed merger will not ad-versely affect area competition nor significantly con-centrate assets in the resulting bank. The ThirdBanking District has 74 commercial institutionswith total deposits of $2.2 billion. A realistic assess-ment of area competition must include considera-tion of the large, competitive Philadelphia banksamong which are the $2.5 billion First PennsylvaniaBank; the $2 billion Philadelphia National Bank;the $1.7 billion Girard Trust Bank; the $1.3 billionFidelity Bank; and the $971 million Provident Na-tional Bank. Although these banks can not physi-cally locate in New Jersey, it has been comparativelyeasy for them to become substantial competitors.A number of residents of Camden and Burlingtoncounties work in Philadelphia and satisfy theirbanking needs through Philadelphia banks. Also,since the Burlington County banks are not able tomeet large money needs, many individual and cor-porate loan requests must be handled by Camdenor Philadelphia institutions. In return, the indivi-dual or business usually will maintain a depositaccount with the bank. If a small bank managesto serve its customers' needs, it usually is on aparticipation basis with larger area banks, oftencontingent on the availability of funds at the cor-respondent level.

Approval of the merger will introduce into Bur-lington County an institution that can accommo-date its rapidly expanding individual and com-mercial needs. South Jersey National Bank willbring a wide variety of services found in all thelarge Philadelphia banks. The lending limit ofSouth Jersey National Bank is slightly in excess of$2 million to any one borrower on an unsecuredbasis, while Union National Bank's is only $300,000.However, the resulting bank, with a limit of $2.5million, will ensure the merging bank's customersof a greatly increased credit source without havingto go to the Philadelphia banks. For constructionloans, the major type of business for the SouthJersey National Bank, the lending limit of SouthJersey National Bank will increase from $22 mil-lion to $25 million, a very desirable increase in viewof growing Camden-Burlington construction de-mands. The resulting bank will introduce a num-ber of banking services that are not presently

69


available to customers of the merging bank suchas an investment advisory service, an estate planningdepartment, full trust services, EDP services, anarmored car service, payroll preparation, lock boxservices, check guarantee cards, and overdraft linesof credit. The present services operated by themerging bank will be updated and expanded.

Applying the statutory criteria to the proposedmerger, we find it is in the public interest and theapplication is, therefore, approved.

JANUARY 21, 1970.


The closest office of Camden Bank is about 12miles from Mount Holly, with several other banksin the intervening area. The proposed merger,therefore, would not appear to eliminate any sig-nificant amount of direct competition between thetwo banks.

Recent legislation in New Jersey broadens geo-graphic areas for bank expansion beyond the formerlimits of county lines by dividing the State intothree banking districts. Under this law, banks mayoperate branch offices within an entire district.However, the law retains community-wide homeoffice protection against de novo branching and

provides branch office protection in communitiesof less than 7,500 persons. Thus, while CamdenBank is presently precluded from branching denovo into communities now served by offices ofUnion Bank, it could establish branches elsewherein Burlington County, possibly coming into com-petition with Union Bank. The proposed mergerwould eliminate this possibility.

Camden Bank is the second largest bank in theThird District, and has evidenced an intent to be-come a regional competitor through entry into newareas of the district. Union National is one of themore substantial banks headquartered in Burling-ton County, holding about 9 percent of the totalcommercial bank deposits therein. However, thetwo largest banks in Burlington County, each sub-stantially larger than Union National, operate of-fices in the vicinity of Mount Holly.

Although the proposed merger would openMount Holly, the county seat of BurlingtonCounty, to de novo branching by other commercialbanks in the district, it would eliminate a substan-tial bank in a growing area, and may have someadverse effect upon the development of a morecompetitive commercial banking structure in theThird District.

THE FIRST NATIONAL BANK OF MARYLAND, BALTIMORE, M D . , AND FIRST NATIONAL BANK OF HARFORD COUNTY, BEL AIR, M D .


First National Bank of Harford County, Bel Air, Md. (13680), withand The First National Bank of Maryland, Baltimore, Md. (1413), which had. . .merged May 1, 1970, under charter and title of the latter bank (1413). Themerged bank at date of merger had

Total assets

$38,156,284727,720,018

761,510,201

Banking offices

Inoperation

548

To beoperated

53

The "Comptroller's Decision" and the "Sum- appeared in the 1968 Annual Report under themary of Report by Attorney General" for this case heading "Approved, but in litigation."

# # #

FIRST TRENTON NATIONAL BANK, TRENTON, N.J., AND NEW JERSEY NATIONAL BANK AND TRUST COMPANY, NEPTUNE, N J .


New Jersey National Bank and Trust Company, Neptune, N J . (15297), with. . .and First Trenton National Bank, Trenton, N J . (1327), which hadmerged May 11, 1970, under charter of the latter bank (1327) and title "NewJersey National Bank." The merged bank at date of merger had

Total assets

$134,280,383508,284,242

642,564,625

Banking offices

Inoperation

1114

To beoperated

25

70



On January 14, 1970, the First Trenton NationalBank, Trenton, N.J., and the New Jersey NationalBank and Trust Company, Neptune, N.J., appliedto the Comptroller of the Currency for permissionto merge under the charter of the former and withthe title "New Jersey National Bank."

The charter bank, with IPC deposits of $265 mil-lion, operates 12 offices in Mercer County, 1 inHunterdon County, and has permission to open 3more branches which are not yet in operation. TheNew Jersey National Bank and Trust Company,the merging bank, has IPC deposits of $110 million,operates 10 offices in Monmouth County, and haspermission to open 3 more branches.

Both banks are located in the newly formedSecond Banking District of New Jersey. However,the areas they serve are completely separate. Thecharter bank serves Mercer County, parts of theSecond Banking District adjoining Mercer County,that part of the Third Banking District south ofTrenton, and a significant portion of Bucks County,Pa., which lies directly across the Delaware Riverto the west. The service area of charter bank con-tains 32 commercial banks with 101 operating orapproved branches, holding $8.5 billion in depositsas of December 31, 1968. The charter bank holds3.8 percent of these deposits and ranks sixth insize. Its competition includes the large Philadelphiabanks, several of which maintain offices within 1mile of the main office of the charter bank.

The New Jersey National Bank and Trust Com-pany is the fifth largest bank in Monmouth County.The county is coextensive with the bank's servicearea and contains 11 commercial banks with 89 of-fices and deposits of $784 million as of December1968. The merging bank held 14.8 percent of thosedeposits. Its main competitors are the Central JerseyBank and Trust Company, the Monmouth CountyNational Bank, and First Merchants National Bank.A new bank charter has been approved for thecounty, and another is pending before the Statebanking officials.

The Second Banking District of New Jersey iscomprised of six central New Jersey counties lyingin a corridor between New York City and Philadel-phia. The district contains a population of approxi-mately 2.2 million. The southwestern portion of thedistrict, which includes charter bank's service area,is oriented economically and commercially towardPhiladelphia, while the northern and eastern por-

tions, including merging bank, are oriented towardNew York City. There are 67 banks in the districtholding total deposits of $3.7 billion. The charterbank has 9.9 percent of those deposits, and the re-sulting bank will hold 13.1 percent.

The banks in New Jersey are grossly undersizedin view of the State's highly urban and industrialeconomy and its dense population. Although theper capita income in New Jersey is very high, it hasa very low ratio of bank deposits per capita. NewJersey has no "city banks" as the term is used inFederal Reserve Board Regulations. Banking isstrictly retail and local.

The reasons for New Jersey's lack of bankingdynamism are both legal and geographical. Its ex-tremely limited branching and merging law haslimited internal growth and expansion, and thisproblem has been compounded by the plethora ofmajor banking services available in nearby NewYork City and Philadelphia. New Jersey's largeand diverse industries require specialized skills andsums of capital available in adequate amountsonly in these two metropolitan areas. As the questfor services extends beyond State lines, the depositsgenerated in New Jersey also flow toward the largerbanks. Consequently, New Jersey banks grow veryslowly even though the local economy has beenmost dynamic.

The recent changes in New Jersey's branchingand merger law divide the State into three districts,and permit branching anywhere within the district,although this permission is restricted by a homeoffice protection clause. It also permits bank merg-ers within each district. The major effect of thenew law is the expanded merger privilege inasmuchas there are very few sites open to de novo branch-ing. The instant proposal is the first attempt in theSecond Banking District to carry out the intent ofthe new banking laws. It will provide a large, dis-trict-wide institution, capable of competing to someextent with the large, metropolitan, out-of-statebanks. Monmouth County, especially, needs a largebank since its economy is growing rapidly and itsfuture prospects are very encouraging. MercerCounty, although it houses the State capital, hasa declining industrial base, urban renewal prob-lems, and much slower growth.

The resulting bank will attempt to provide cor-respondent services in order to keep district depositswithin the State. In addition, the resulting bankwill bring to Monmouth County the followingservices presently unavailable in the county: elec-

71


tronic data processing services, international bank-ing services, credit card services, and a municipalbond department. In addition, the merger willeliminate home office protection in Neptune,thereby opening it for further expansion by otherbanks.

The proposal will have no adverse competitiveeffects. Since most banks in New Jersey are smalland localized, they will be largely unaffected bythe proposal. The applicant banks do not competewith each other. Their home offices are 39 milesapart, and their closest branches are 23 miles apart.A proposed branch of New Jersey National Bankis 15 miles from charter bank's closest branch. Theservice areas of the two banks are independent ofeach other, separated by years of legal barriers andby rural areas having little banking potential. Only0.4 percent of the charter bank's deposits are de-rived from Monmouth County, and an even smallerpercentage of New Jersey National Bank's depositsare generated from charter bank's service area.

The proposal appears to be in the public interestin light of statutory criteria, and is designed tocarry out the intent of the citizens of New Jerseyas reflected in the 1969 banking amendments. Itfurther appears to be without adverse competitiveeffects. The application, therefore, is approved.

APRIL 9, 1970.


First Trenton serves a large area surrounding thecity of Trenton in the southeastern section of NewJersey's Second Banking District, including all ofMercer County and adjacent sections of surround-ing New Jersey counties, as well as portions ofBucks County, Pa. Its recently approved office inMiddlesex County will broaden its service area tosome extent.

Neptune Bank's existing offices lie in easternMonmouth County, east of the Garden State Park-way. Its two approved, but as yet unopened, officesin Howell Township and Freehold Borough willafford entry into the central part of the county.

The nearest offices of the merging banks, openor approved, are about 15 miles apart, with severalintervening banking alternatives. It would appearthe proposed merger will not eliminate substantialexisting competition.

Recent banking legislation in New Jersey dividesthe State into three banking districts; cross-countybranching is now permitted, either de novo or bymerger, within an entire district. However, de novobranches may not be opened in communities wherea bank has its head office, or where a branch officeexists if the population is less than 7,500.

These recent amendments to New Jersey lawhave induced substantial market expansion effortsby the State's larger banks, both through applica-tion for de novo offices and through mergers. Anumber of the larger banks in the State have alsoannounced plans to expand through formation ofregistered bank holding companies, which may con-trol banking subsidiaries throughout the State. Webelieve that large banks should expand either denovo, or through acquisition of smaller banks innew markets they wish to serve. In this manner,leading banks in the new areas will be preserved tooffer effective competition to entering banks, andmay themselves be the nuclei of developing institu-tions capable of competing with the largest bankson a broad geographic scale.

In view of its position as the largest commercialbank in the Second Banking District, and its ad-mitted interest in broadening its service area, FirstTrenton is clearly one of the most likely entrantsinto banking competition in Monmouth County.Other sources of potential competition includenewly forming registered bank holding companies,primarily led by major banks in the First BankingDistrict.

Neptune Bank is one of the four large banks inMonmouth County which together hold about 78percent of the county's total deposits. Merger withone of the smaller banks in Monmouth Countycould afford First Trenton the entry it seeks, andintroduce another strong competitor into thishighly concentrated market. Monmouth County isan attractive market for entry because of its rapideconomic expansion.

In view of the alternative means of entry byFirst Trenton into Monmouth County, it wouldappear that the proposed merger, which wouldeliminate one of the county's larger banks andmost capable competitors, would have an adverseeffect on competition.

72


THE CASSIA NATIONAL BANK OF BURLEY, BURLEY, IDAHO, AND LAVA HOT SPRINGS STATE BANK, LAVA HOT SPRINGS, IDAHO


Lava Hot Springs State Bank, Lava Hot Springs, Idaho, withand The Cassia National Bank of Burley, Burley, Idaho (12256), which hadmerged May 18, 1970, under charter of the latter bank (12256) and title "CassiaNational Bank." The merged bank at date of merger had

Total assets

$739,85713,081,949

13,821,806

Banking offices

Inoperation

12

To beoperated

3


On December 10, 1969, the Lava Hot SpringsState Bank, Lava Hot Springs, Idaho, and TheCassia National Bank of Burley, Burley, Idaho, ap-plied to the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of "Cassia National Bank."

The Cassia National Bank of Burley, with IPCdeposits of $10.6 million, was organized in 1922. Itoperates through its main office and one branchoffice.

Burley, located in the south-central section of theState, has a population of 8,700, and serves a tradearea population of 30,000. The economy of the areais heavily dependent on agriculture, particularlypotato growing, and, to a lesser extent, upon live-stock raising. Several large processing plants whichfurnish year-round employment also contribute tothe economy.

Banking competition in Burley is very keen. Inaddition to the charter bank, which ranks 10th insize of the 26 banks operating in the State, branchesof the much larger First Security Bank, and Bankof Idaho serve the Burley area. The ProductionCredit Association, Farm Home Administration, 10credit unions, and several savings and loan associa-tions also serve the area.

Lava Hot Springs State Bank was organized in1917, and today, with total deposits of $335 thou-sand, ranks as the smallest bank in the State. Priorto the acquisition of the stock of this bank by eightpersons who own 85 percent of the Cassia NationalBank, it paid only 1 percent on savings accounts.As a result, 90 percent of its deposits are in the de-mand category. The loan to deposit ratio is only14 percent, with over 70 percent of the total assetsinvested in United States Government obligations.

Lava Hot Springs, situated in Bannock County,33 miles southeast of Pocatello and 111 miles eastof Burley, has a population of 600. Although Lava

Hot Springs lies in an agricultural area, its princi-pal activity, as its name would indicate, is as ahealth resort and recreational center. During thesummer months the population of the towndoubles.

This merger will have no competitive impact ineither the Lava Hot Springs or Burley areas. Sincethe closest bank to Lava Hot Springs is 28 milesdistant, it will not be affected. In the Burley area,this merger will not alter the banking structure.Clearly, this merger will not eliminate any compe-tition between the participants.

This merger will be of benefit to the customersin the Lava Hot Springs area by increasing the in-terest rate on savings accounts, thus making themmore attractive to the Lava Hot Springs customers.Not only will it increase the lending limit at theLava Hot Springs office of the resulting bank, butit will make credit available to develop service typebusinesses to match the new recreational develop-ments. Real estate financing will also becomeavailable.

Applying the statutory criteria, it is concludedthat the proposed merger is in the public interest.The application is, therefore, approved.

MARCH 25, 1970.


Cassia National, with total deposits of $11.6 mil-lion, operates its main office and its only branch inBurley. Lava State, with total deposits of $361,000,is the only bank in Lava Hot Springs (approximatepopulation 600).

Since the applicant banks are located about 113miles apart, the proposed merger will not eliminateany direct competition. Considering the size of themerging banks, it is not likely that either of thebanks can be considered likely potential competi-tors in the other's market. Therefore, this mergerwill have no anticompetitive effect.

73


PEOPLES NATIONAL BANK OF N E W JERSEY, WESTMONT, HADDON TOWNSHIP, N J., ANDTHE VINELAND NATIONAL BANK AND TRUST COMPANY, VINELAND, N J .

Name of bank and type of transaction Total assets

Banking offices

Inoperation

To beoperated

The Vineland National Bank and Trust Company, Vineland, NJ. (2918), with. .and Peoples National Bank of New Jersey, Westmont, Haddon Township, NJ.(12022), which hadmerged May 22, 1970, under charter and title of the latter bank (12022). Themerged bank at date of merger had

$29,709,165

131,715,508

166,461,909

5

10

15


On October 16, 1969, The Vineland NationalBank and Trust Company, Vineland, N.J., andPeoples National Bank of New Jersey, Westmont,Haddon Township, N.J., applied to the Comp-troller of the Currency for permission to merge un-der the charter and with the title of the latter.

Peoples National Bank of New Jersey, with IPCdeposits of $98 million, was chartered as a Nationalbank in 1918. It presently operates seven officesthroughout Camden County and, in addition, hasreceived approval for seven new offices, five in Cam-den County and one each in Atlantic and Glou-cester counties. Three offices will be added whenthe merger with Farmers and Mechanics NationalBank, Woodbury, N.J., which was approved Octo-ber 10, 1969, is consummated. Peoples NationalBank is affiliated through common ownership andvoting control with the $12 million The FirstNational Bank of Riverside, Riverside, NJ., in Bur-lington County.

Camden County, home of the charter bank, is inthe southwestern part of New Jersey, and is bor-dered by the Delaware River on the west and byBurlington, Atlantic, and Gloucester counties onthe remaining three sides. The county's population,471,310 in 1968, has grown more than 20 percentsince 1960. Due to its location adjacent to Philadel-phia and within the Delaware Port complex, itseconomy is well diversified with numerous sizeableindustries and retail centers providing a variedeconomic base. The continued influx of commerceand industry into the area available for develop-ment assures a favorable economic outlook.

Peoples National Bank is the fourth largest of theeight commercial banks in Camden County, andsixth largest of the 74 commercial banks in theThird Banking District. It faces intense competi-tion within its trade area from the three larger

Camden County banks, namely: the $282 millionCamden Trust Company; the $270 million SouthJersey National Bank, Camden; and the $125 mil-lion Colonial National Bank, Haddonfield. Addi-tional competition is generated by 15 commericalbanks located in Philadelphia, Pa., 9 of which arelarger than the resulting bank. The competingPhiladelphia banks include the $2.5 billion FirstPennsylvania Bank; the $2.1 billion PhiladelphiaNational Bank; the $1.7 billion Girard Trust Bank;the $1.4 billion Fidelity Bank; and the $971 millionProvident National Bank. Competition is also fur-nished by 64 savings and loan associations operatingthroughout the county, and the numerous othernon-bank financial institutions operating in thearea.

Vineland National Bank and Trust Company, themerging bank, with IPC deposits of $22.9 million,was organized in 1883 and presently operates threeoffices, all within the city of Vineland.

Cumberland County, home of the merging bank,had an estimated population of 127,770 in 1968,representing a 20 percent population increase overthe last 8 years. It is well situated geographically,with the most populated areas of the county only40 miles from Philadelphia and 35 miles from theJersey shore. Agriculture is an important economicfactor in the county, and industrial activity is agri-culturally oriented through food processing andpackaging, and glass container manufacturing. In-dustrial and residential growth is expected to con-tinue as planned expressways are completed andaccess to this area from Philadelphia and Camdenis facilitated.

Competition within the county is furnished byeight commercial banks, five savings and loan as-sociations, and one building and loan association.Vineland National Bank and Trust Company, themerging bank, holds 15 percent of the county's com-mercial bank deposits. The largest bank in the


county is the $41 million Millville National Bank,Millville, holding 22 percent of the country's de-posits, while the second largest bank, the $36 mil-lion The Tradesmen's Bank and Trust Company,Vineland, holds 19 percent. The latter bank is thesubject of a pending merger with the $282 millionCamden Trust Company, Camden, the largest bankin the Third Banking District.

The proposed merger, if approved, will make abroader range of banking services available to theresidents in the south-central part of New Jersey.An increased lending limit will be available to pro-vide for the borrowing needs of the larger com-panies in the Vineland area. Through this mergerPeoples National Bank would substitute its pro-gressive and aggressive management for that of theconservative Vineland National Bank.

This merger will not adversely affect competi-tion. As the closest existing offices of the two banksare 20 miles apart, there is no present competitionbetween them and no elimination of any alterna-tive banking source will result from this merger.The resulting bank will be the fourth largest com-mercial bank of the 74 existing banks in the newlyformed Third Banking District of New Jersey, butwill hold only 6 percent of the total banking de-posits in the district. The merger will enable theresulting bank to compete more effectively withthe large Philadelphia-based banks operating in theCamden area. Competition should be stimulatedin both Camden County and the Third BankingDistrict as a whole, because the resulting bank willbe a more effective competitor without disadvantag-ing the smaller banks in the district. In Cumber-land County, all banks should continue their pres-ent competitive position while competition amongthe larger banks will be stimulated without reduc-ing the number of available alternatives.


DECEMBER 30, 1969.


The closest offices of the merging banks are about25 miles apart; numerous competitive alternativeslie in the intervening area. According to the appli-cation, there is no overlap in the geographic sourcesof deposit and loan accounts of the merging banks.Thus, the merger would not appear to eliminate

any significant amount of existing competition be-tween the two banks.

Under recent changes in New Jersey law, com-mercial banks may now operate branches anywherethroughout the newly created banking district inwhich they are located. De novo branching, how-ever, is limited by complete home office protectionand branch office protection in communities of lessthan 7,500 population. Peoples and Vineland Na-tional are both located in the Third Banking Dis-trict, comprised of eight counties in southern NewJersey.

Peoples is one of the largest banks in the ThirdDistrict, and has sufficient resources to open de novobranch offices where attractive. Peoples has demon-strated the intent to expand its service area, andmarkets in Cumberland County, including Vine-land, present attractive areas for bank expansion.However, the three major population centers ofCumberland County, Vineland, Millville, andBridge ton, each have home offices of commercialbanks and are thus insulated from de novo branch-ing by outsiders. In like manner, many of the othercommunities in Cumberland County are protectedby branch offices of other commercial banks. Peo-ples' opportunities for de novo entry into Cumber-land County are accordingly limited.

We note, however, that Peoples has chosen toenter Cumberland County through merger withone of the more substantial county banks. We be-lieve it important, from a competitive standpoint,that the largest banks in the district enter new areasthrough de novo branching, or in the alternative,through merger with small banks. In this manner,the larger local banks, most capable of competingwith large new entrants will be preserved. Theselarger local banks, through affiliation with one an-other or in bank holding companies, are alsosources of possible competition to the largest dis-trict banks on a broader scale.

We believe that systematic acquisition of thelarger local banks in many areas by the largestbanks in the district may result in undue concen-tration of commercial banking services in a limitednumber of giant banking institutions. Therefore,it would appear that Peoples' entry into Cumber-land County through merger with one of thesmaller banks located in the county would have amore positive effect on competition than its entrythrough merger with Vineland National.

75


ZIONS FIRST NATIONAL BANK, SALT LAKE CITY, UTAH, AND BANK OF COMMERCE, MAGNA, UTAH


Banking offices

Inoperation

To beoperated

Bank of Commerce, Magna, Utah, withwas purchased May 29, 1970, by Zions First National Bank, Salt Lake City,Utah (4341), which hadAfter the purchase was effected, the receiving bank had

$2,147,844

257,221,284259,369,128

1

1718


On January 26, 1970, Zions First National Bank,Salt Lake City, Utah, applied to the Office of theComptroller of the Currency for permission topurchase the assets and assume the liabilities of theBank of St. George, St. George, Utah, and the Bankof Commerce, Magna, Utah.

Zions First National Bank, the purchasing bank,with IPC deposits of $175.4 million, is the resultof a merger in 1957 of three Salt Lake City banks:the Zions Savings and Trust Company, opened in1873; the Utah Savings and Trust Company, or-ganized in 1899; and the First National Bank ofSalt Lake City, organized in 1890. The purchasingbank, owned by the Zions Utah Bancorporation,presently operates 16 banking offices and has ap-proval for an additional branch. Primary competi-tion for the bank derives from the State's two larg-est banks, viz., the $594.5 million First SecurityBank of Utah, N.A., and the $308.1 million WalkerBank and Trust Company.

Salt Lake City, with a population of almost500,000 persons, is the county seat of Salt LakeCounty and the State's capital. Operations of ZionsFirst National Bank were confined to Salt LakeCounty until 1968 when an office was establishedin Spanish Fork, some 65 miles south. Subsequentlyan office was established in Heber City, Utah, 50miles southeast, and two offices were established inProvo, Utah, some 45 miles south. The city andits environs constitute Utah's major population,commercial, and industrial area, the economy ofwhich is widely diversified with mining, manufac-turing, transportation, agriculture, commerce, andmilitary activities prevailing. The largest employeris Kennecott Copper Corporation which has 7,000employees. Other significant contributors to thearea's economy include numerous defense projects;Hill Air Force Base, located 25 miles north, theState's largest employer with about 18,000 civilian

employees; and the University of Utah with anenrollment of about 14,000 persons.

The Bank of Commerce, Magna, Utah, one ofthe two selling banks, with total IPC deposits of$1.5 million was organized in 1963. This bank, aunit institution, is suffering from various operatingproblems which are reflected in the bank's earningsrecord; it did not show a profit until 1967.

The community of Magna is located in Salt LakeCounty, near the western boundary, approximately19 miles southwest of the central business district ofSalt Lake City. Magna has a population estimatedat 7,000 and was originally organized in 1906 as acompany town for the Kennecott Copper Corpora-tion, which remains the town's principal employer.Local banking competition is confined primarilyto the Magna branch of the $536 million FirstSecurity Bank of Utah, N.A. The nearest office ofthe purchasing bank is 10 miles distant. Two creditunions are also located in Magna; the membershipof each consists of employees of Kennecott CopperCompany who live throughout the Salt Lake Cityarea.

The Bank of St. George, St. George, Utah, theother selling bank, with IPC deposits of $11.4 mil-lion, was organized in 1906 and has operated con-tinuously since that time. It has two branches, oneat Hurricane, acquired in 1956 through mergerwith the State Bank of Hurricane, and the other ade novo branch opened in 1965 at Enterprise, Utah.

All three offices of The Bank of St. George arelocated in Washington County which has a popula-tion of 7,000. Washington County is in the extremesouthwestern corner of Utah, bordered by Arizonaon the south and Nevada on the west. The economyis agriculturally oriented with livestock productiona major source of income. Crops consist of grain,alfalfa, and sugar beets, as well as fruits common toa warm southern climate. Tourism also plays amajor role. St. George is the principal tradingcenter in the area and is 313 miles from Salt Lake

76


City. The town has a typical rural business districtexcept for a large number of motels and restaurantslocated along highway 91, the major route connect-ing Los Angeles, Las Vegas, Salt Lake City, Denver,and other points east and west. Dixie College, aState 2-year institution is also located here. TheBank of St. George is the only bank in the county.The Cedar City branch of First Security Bank ofUtah, N.A., located some 50 miles to the northeasthandles Bank Americard for the area. A new Statebank has been approved for St. George.

Banking competition in Utah is divided among51 banks. Of these the purchasing bank ranks thirdin size controlling about 13.5 percent of the State'sbank deposits. The largest bank in the State, theFirst Security Bank of Utah, N.A., holds 29 percentof bank deposits, while the second largest bank,Walker Bank and Trust Company, controls 16 per-cent of these deposits.

Consummation of the subject purchases will havesignificant beneficial effects. In the Magna area thesingle office Bank of Commerce will be replacedby a much larger institution more capable of serv-ing the community's banking needs. Services whichthe Bank of Commerce does not offer, but whichwill be offered by the resulting institution, includetrust services, complete electronic data processingservices, credit card services, and larger lendinglimits. In addition the operating problems of thesmaller Bank of Commerce will be solved by itsabsorption into the much larger Zions First Na-tional Bank. In St. George and Washington County,entry of the Zions First National Bank will meanthe offering of complete trust and EDP services aswell as a larger lending limit which will be particu-larly beneficial to the large ranchers and farmersin the northern part of the county whose creditneeds cannot be presently met by the smaller Bankof St. George.

Competition will not be adversely affected byconsummation of the proposed purchases. There is

little present competition between the subject banksto be eliminated. Statewide, the resulting bank'sposition as third largest of the State's 51 banks willbe unchanged by its purchase of the State's 14thand 51st largest banks while its share of total Statedeposits will increase only from about 13 percentto 14 percent. Potential competition will not be af-fected since in Magna, Hurricane, and Enterpriseit would be economically unfeasible to establishde novo branches, while in St. George, State de novobranching restrictions prohibit the establishmentof de novo branches. In fact consummation of thepurchase of the Bank of St. George will open upthat town to de novo branching, thereby enhancingcompetition.


APRIL 16, 1970.


The closest office of Zions to St. George's officeis about 250 miles distant. The proposed acquisi-tion would not, therefore, eliminate any existingcompetition between these two institutions.

Commerce is, however, 10 miles from the nearestoffice of Zions. The proposed acquisition would,therefore, be likely to eliminate some existing com-petition between these two institutions. However,the largest bank in the State maintains an office inMagna which has deposits twice those of Commerce.

Under Utah law, no bank can open a bankingoffice in St. George while St. George remains an in-dependent bank. There is, further, no other com-munity in the county large enough to support anew branch. This merger will, therefore, not resultin a substantial elimination of competition.

We, therefore, conclude that the proposed acqui-sitions will not have a significantly adverse effecton either actual or potential competition.

VIRGINIA NATIONAL BANK, NORFOLK, V A . , AND THE MERCHANTS AND FARMERS BANK, SMITHFIELD, V A .


The Merchants and Farmers Bank, Smithfield, Va., withand Virginia National Bank, Norfolk, Va. (9885), which hadmerged June 1, 1970, under charter and title of the latter bank (9885). Themerged bank at date of merger had

Total assets

$9,760,533958,154,895

967,583,357

Banking offices

Inoperation

1101

To beoperated

102

77



On February 16, 1970, The Merchants and Farm-ers Bank, Smithfield, Va., and the Virginia NationalBank, Norfolk, Va., applied to the Comptroller ofthe Currency for permission to merge under thecharter and with the title of the latter.

The Merchants and Farmers Bank, the merginginstitution, was established in 1905, and presentlyrecords IPC deposits of $8.4 million. It is a singleunit bank located in Smithfield, and is the smallestof the three banks serving Isle of Wight County,Va. The principal officer of the bank is 70 years oldand, with his retirement imminent within a fewyears, there is no provision for his replacement byanyone within the merging bank's personnel.

Smithfield, with a population of 3,300, is thecounty seat of Isle of Wight County. It is located insoutheast Virginia, between Norfolk and Peters-burg. The economy of Smithfield and Isle of Wightis principally agriculture and food processing, withabout 60 percent of the county's land utilized byfarmers. The remaining lands are swamps and lightforests which support the local paper mill and pulpindustry. Isle of Wight County and Smithfield areknown principally for the Smithfield ham, whichbecame famous as a result of the hogs raised onpeanuts introduced into the county from Africa inthe early 17th century. The principal manufactur-ing firms in the county include the Union CampCorporation, a paper products plant employing1,800 people, and Gwaltney, Inc., and SmithfieldPacking Company, both of Smithfield, employingabout 950 people, respectively.

Virginia National Bank, the charter bank, is theoutgrowth of a 1963 merger of Peoples NationalBank of Central Virginia, Charlottesville, and TheNational Bank of Commerce, Norfolk. Through asubsequent series of mergers with twenty smallbanks scattered throughout the State and averagingless than $10 million in size, the charter bank pene-trated markets in central, southern, and southwest-ern Virginia and, recently, the northern Virginiasuburbs of Washington, D.C. It is notable that Vir-ginia National Bank has offices in only two of thesix major metropolitan areas of the State. As ofDecember 31, 1969, the bank operated 97 branchesand two military facilities which aggregately re-corded $692.8 million in IPC deposits. It also hasreceived approval to open three more branches inthe area of Norfolk, and a merger with the $39.7

million First National Bank of Harrisonburg hasbeen approved but not yet consummated.

The charter bank is the largest independent bankwithin the Commonwealth of Virginia, and withits wide branch network, its total service area en-compasses the majority of the State, with the ex-ception of the northwest area. Notwithstanding itsstatewide organization, the primary operations ofthe charter bank are carried on in the tidewaterarea, in and around Norfolk, a city of approxi-mately 330,000 people, and in those communities incentral Virginia around Charlottesville, a city ofapproximately 30,000 people.

Since Merchants and Farmers Bank is a unit in-stitution serving the Smithfield portion of Isle ofWight County, the number of people served in themarket area numbers no more than 10,000 at themaximum, and probably a more realistic figurebased on Smithfield and surrounding environswould be approximately 5,000 persons. Geographi-cally, the area is nondescript. It lies in the CoastalPlain region with elevations from sea level to 100feet; the northern portion of the county's area isswampy. Approximately one-half of the county isforested, with most of the remaining land devotedto agriculture. Although Isle of Wight is famousfor its cured hams, this business in itself is not suf-ficient to make the area an economically significantsection of the country.

During the years between 1940 and 1960, thepopulation of Smithfield decreased by 200 persons;however, since 1960, the population has againgrown to the 1940 level. The three aforementionedpaper and food processing firms employ about 95percent of the work force in the area and, due tothe nature of their business, employment tends tobe seasonal. It is notable that no new manufactur-ing firms have settled in Isle of Wight in the last20 years. Smithfield Packing Company has an-nounced that due to its large credit needs it cannotdepend upon the three Isle of Wight banks butmust do its business with the charter bank which ispresently some distance away. The firm has indi-cated that it will switch its account to the first largebank that can enter the area and handle its creditneeds. Accordingly, the economic future of thecounty, while not bleak or presently depressed, de-pends upon large, aggressive banks to assist thepresent businesses and induce new business to enterthe area.

This merger will not eliminate any significant or

78


potential competition. Presently, the charter bankhas no branches within Isle of Wight. Its nearestoffices are at least 20 miles away at Franklin, Hamp-ton, and Suffolk. Aside from two large loans tobusinesses in Smithfield that the merging bank can-not service, the Virginia National Bank derives only50 deposit accounts from the merging bank's mar-ket area. Likewise, the merging bank does an in-significant amount of business outside of the Isle ofWight, deriving $6.5 million of its $8.8 million indeposits from the town of Smithfield itself.

The potential for competition by the charterbank into Isle of Wight is limited only to mergerwith one of the three county banks. State law for-bids de novo branching and, in any event, the Isleof Wight market is not attractive for entry by afourth institution due to expense and lack of busi-ness.

The Isle of Wight market supports two other in-stitutions in addition to the merging bank: the$11.7 million deposit Bank of Smithfield, and the$9.9 million deposit Farmers Bank, Windsor, Va.,some 15 miles southwest of Smithfield. Other localcompetition from nearby counties includes the $4.2million Bank of Surrey County, Surrey, Va., 18miles northwest, and the $2.7 million Bank of Nan-semond, 15 miles southeast of Smithfield. While onebank will be eliminated at Smithfield, its office willremain open as a branch of a bank which offersthe fullest line of services for the merging bank'scustomers and the community. The charter bank ismany times larger than the two other banks inSmithfield, but it is not expected that the mergerwill adversely affect the community's present bank-ing structure since the smaller banks will continueto attract customers to the particular services whichthey presently offer. The distinctive feature of thismerger is that the charter bank will be extendingservices that the merging bank and its two com-petitors haven't the capacity to afford the public.Essentially, the charter bank will be initiating serv-ices which presently are not offered, rather thanconcentrating all its resources and personnel onthat sector of the market which is already wellserved.

Among other services the Virginia National Bankcan bring to the Smithfield area is a comprehensivemortgage loan program for construction and longterm business loans. The bank is also acquainted

with and participates in Small Business Adminis-tration loans. For local municipal authorities, Vir-ginia National operates a specialized municipalbond department which participates in the under-writing, trading, and distribution of municipal se-curities. Moreover, Virginia National has excellentcomputer services, agricultural services, and trustfacilities. Locating the charter bank in Smithfieldwill permit it to quickly and easily service thecredit needs of the town's largest employers to theadvantage of all the parties concerned. Althoughthis merger may appear to be slightly anticompeti-tive to the other two banks in Smithfield, the bene-fits to the community will far outweigh any anti-competitive aspects of the merger.

Applying the statutory criteria to the proposedmerger, we find that it is in the public interest. Theapplication is, therefore, approved.

APRIL 29, 1970.


Merchants is the smallest of three banks based inIsle of Wight County. VNB has no offices in thiscounty. Its closest offices to Smithfield are at Hamp-ton, 20 miles distant across the James River; at Suf-folk, 20 miles southeast; and at Franklin, 32 milessouthwest. An analysis of all VNB demand depositaccounts originating within a 15-mile radius ofSmithfield disclosed 50 accounts with deposits of$85,285, or 0.004 percent of VNB's Tidewater de-mand deposits. A similar analysis at Merchants re-vealed that deposits totaling $292,809, or 3.3 percentof its total deposits, originated in areas served withVNB. Thus, it would appear that only a limitedamount of direct competition between the bankswould be eliminated by the proposed merger.

Under Virginia law VNB cannot open de novobranch offices in Isle of Wight County. The twoother banks based in that county, Bank of Smith-field and Farmers Bank, are comparable in size andmarket position to Merchants, although somewhatlarger. Thus, there is no present merger pathwhereby VNB could enter Smithfield without ac-quiring a larger market position.

The proposed merger would, however, eliminatethe possibility of VNB's entry through establish-ment of a holding company, and acquisition of anewly chartered bank in the area.

79


THE FIRST NATIONAL BANK OF HOULTON, HOULTON, MAINE, AND THE FIRST NATIONAL BANK OF FORT FAIRFIELD,FORT FAIRFIELD, MAINE


The First National Bank of Houlton, Houlton, Maine (2749), withand The First National Bank of Fort Fairfield, Fort Fairfield, Maine (13843),which hadmerged June 2, 1970, under charter of the latter bank (13843), and title "TheFirst National Bank of Aroostook." The merged bank at date of merger had

Total assets

$20,433,149

8,986,563

29,541,440

Banking offices

Inoperation

2

2

To beoperated

4


On December 5, 1969, The First National Bankof Houlton, Houlton, Maine and The First Na-tional Bank of Fort Fairfield, Fort Fairfield, Maine,applied to the Comptroller of the Currency for per-mission to merge under the charter of the latter andwith the title of "The First National Bank ofAroostook."

The First National Bank of Houlton, the merg-ing bank, was organized in 1882, and presently re-cords IPC deposits of $16.5 million. This family-controlled bank has its main office in the businesssection of Houlton, and one branch office, openedin 1969, in the Houlton shopping center, approxi-mately 1 mile from the head office. Its primaryservice area extends in a rectangular pattern 10miles north of the city and 40 miles south alongU.S. Route 1.

Houlton, Maine, with a population of 8,400 per-sons, is the county seat of Aroostook County whichis located in the far northeast corner of the State.The city is situated in the southeastern portion ofthe county approximately 7 miles west of the prov-ince of New Brunswick, Canada. Well removedfrom any sizeable metropolitan area, Houlton lies116 miles northeast of Bangor and 192 miles north-east of Augusta, the capital of Maine. The citycontains Ricker College, which has a current en-rollment of 625, two hospitals, three nursing homes,and 115 retail establishments including 19 foodstores and 14 auto dealerships. Transportation fa-cilities serving Houlton and the surrounding areainclude railroad, air, bus, and truck services. Pas-senger service is confined to bus and air service.Interstate 95 begins in Houlton, and U.S. Route 1runs north and south through the city. The eco-nomy of Houlton, as in the whole of AroostookCounty, is based upon agricultural crops, particu-larly potatoes, and lumber and associated paper

products. In recent years, with the advent of betterroads, there has been marked growth in the recrea-tion and tourist industries.

The First National Bank of Fort Fairfield, thecharter bank, was organized in 1933, and presentlyrecords IPC deposits of $4.3 million. The bank isa subsidiary of Depositors Corporation, a registeredbank holding company that controls the $145 mil-lion Depositors Trust Company, Augusta, Maine.The First National Bank of Fort Fairfield was aunit bank until late 1969, when it opened a branchfacility at Presque Isle, 12 miles southwest of FortFairfield. The effective service area of the charterbank is rectangular in shape and extends about 12miles beyond Fort Fairfield and Presque Isle, thetwo cities which lie at either end of its service area.

Fort Fairfield is a town of 5,800 persons, 50 milesnorth of Houlton, 168 miles northeast of Bangor,and 244 miles northeast of Augusta. The commer-cial heart of Aroostook County lies within a 14-mile radius of Fort Fairfield and includes suchcommunities as Presque Isle, a city of 12,638; Cari-bou, with a population of 13,294; Limestone, witha population of 17,441; and Easton, a town of 1,400.

The economy of the Fort Fairfield area is foundedon agricultural and forestry products. Large firmsin the area that employ 200 or more peopleinclude American Kitchen Industries, Vahlsing Inc.,A8cP National Produce Division, Converse RubberCompany, Indianhead Plywood, and Potato ServiceInc. Vahlsing Inc., a food processing concern inEaston, is presently undergoing a $9 million expan-sion program, and recent construction in PresqueIsle, both public and private, totals $8.5 million,with projected construction in the future to ap-proach $6.5 million. Three of the aforementionedcommunities have their own hospitals, comple-mented by two nursing homes. The presence ofPresque Isle Air Force Base, a Strategic Air Com-

80


mand installation at Limestone, is a significanteconomic factor in the Presque Isle area.

Because of its peculiar geographic and demo-graphic characteristics, Aroostook County cannotproperly be considered an economically significantsection of the country within which to evaluate thecompetitive consequences of this cash merger. Thiscounty, whose entire eastern border abuts the prov-ince of New Brunswick for a distance of 100 miles,is the largest in the State of Maine. Because of itsrough terrain, thick forests, and lack of roads, thecounty and its people are somewhat isolated fromthe more populous centers in the southern sectionof the State. Although this county, with 109,500residences, is the third most populous in the State,the majority of those people live in the towns alongthe eastern border. Most of the county has a popu-lation density of less than 10 persons per squaremile.

During the last 20 years the economy of thecounty has been undergoing a drastic change. Thepotato has lost its preeminence. The fact that smalland medium farmers cannot profitably raise a po-tato crop is demonstrated by the extensive creditadvanced to farmers in the county by the FarmHome Administration. The Federal Land BankAssociation and the Production Credit Corporationalso have large credits outstanding in the county.The economic future for this area depends on largeaggressive banks inducing new business to locatein the county.

This merger will not eliminate any significantcompetition or potential for competition that mightexist between the two applicant banks. The perim-eters of the applicants' service areas are approxi-mately 20 miles apart and the actual bankingpremises are some 50 miles apart. Furthermore, awide belt of forested terrain separates the two serv-ice areas; U.S. Route 1 is the only principal high-way linking the two areas. Although the merger willeliminate one bank, its offices will remain open asbranches of the resulting bank to provide a morecomplete line of services for the needs of the cus-tomers and the community. While branching isallowed throughout Aroostook County, futurebranching by either of the applicant banks appearsto be very limited due to the inherent expense ofstarting a new facility, the sparse scattering of peo-ple in the county, and the present distribution ofcompeting banking offices in the most populatedareas of Aroostook County. The proposed merger

will not affect the Aroostock County banking struc-ture in an adverse manner.

Other banks now operating in the service areaare the $53 million Northern National Bank, the$11 million Aroostook Trust Company, and theHoulton Trust Company and Washburn TrustCompany, both with approximately $7 million indeposits. Subsequent to the merger, the NorthernNational Bank will still hold 21/% times the depositsof the resulting bank. On the other hand, the re-sulting bank will be able to generate more com-petition with Northern National Bank through theincreased lending limit and the increased econo-mies and services afforded by the Depositors Cor-poration affiliation with the charter bank. Althoughthe remaining three banks are smaller than the re-sulting bank, this merger should not adversely affectthem. The Washburn Trust Company, in spite ofrecording only $7 million in deposits, has an affilia-tion with the $90.3 million Merrill Trust Company,Bangor, Maine, a registered bank holding company.The Houlton Trust Company, another $7 milliondeposit institution located in Houlton, Maine, isalready directly competitive with the merging in-stitution. The Aroostook Trust Company, a non-affiliated commercial bank with $11 million indeposits, is the largest of the three small banks.Because of its size and the location of its branchoffices, it should be able to retain its share of thebanking market.

While noncommercial banking competition is notconsidered particularly strong in the area, the Aroo-stook County Federal Savings and Loan Associationhas offices in Caribou and Presque Isle and fourloan companies, a credit union, and two produc-tion credit associations for farm needs provideservices within the service area. The Federal Gov-ernment operates offices of the Farmers Home Ad-ministration in Houlton, Fort Fairfield, PresqueIsle, and Caribou.

The public will benefit from this merger due tothe increased capabilities of the resulting bankover the individual applicants to serve new custom-ers that previously have not been attracted to theexisting separate institutions. This is especially trueof The First National Bank of Fort Fairfield whichis in direct competition with five branches of theNorthern National Bank in the Fort Fairfield area.The customers of The First National Bank of Houl-ton will receive the benefits of the resulting bank'saffiliation with Depositors Corporation. The lend-

81


ing limit of the resulting bank will attract manycustomers who, in face of rising credit needs andthe limited lending capabilities of applicant banks,have had to turn to the Portland, Augusta, andBangor banks, and, in some cases, to banks in Bos-ton and New York to negotiate loans. The publicwill also be the beneficiary of a wide array of spe-cialized services including loans participations, in-vestment and portfolio management, and a trustoperation presently run by The First National Bankof Houlton. Although this merger may appear tobe slightly anticompetitive to the three smallestbanks in the trade area, the benefits that the com-munity will derive from the merger plus the addedcompetition that the resulting bank will providethe Northern National Bank outweighs any anti-competitive aspects.


MARCH 20, 1970.


Ft. Fairfield Bank is a subsidiary of DepositorsCorporation ("Depositors"), the largest banking

organization and the largest of four bank holdingcompanies in Maine. On August 13, 1969, Deposi-tors' application to acquire Houlton Bank wasdenied by the Board of Governors of the FederalReserve System after comprehensive evaluation ofthe competitive factors involved. The instantmerger application would appear to be an effort tocircumvent that decision, and presents essentiallythe same competitive effects discussed by the Fed-eral Reserve Board in denying the Depositors' ap-plication to acquire Houlton Bank.

When its original application to acquire HoultonBank was denied, Depositors also had pendingapplication to acquire Katahdin Trust Co., thesmallest of seven commercial banks operating inAroostook County. Since that time, Depositors'agreement with Katahdin Trust Co., has been ter-minated. Since the then pending application toacquire Katahdin Trust Co., played little, if any,part in the Federal Reserve Board's decision, webelieve that the Board's opinion of August 13, 1969,accurately evaluates the competitive factors in-volved in the proposed merger and adopt its con-clusions with respect thereto.

SOUTHERN CALIFORNIA FIRST NATIONAL BANK, SAN DIEGO, CALIF., AND GATEWAY NATIONAL BANK, EL SEGUNDO, CALIF.


Gateway National Bank, El Segundo, Calif. (15239), withand Southern California First National Bank, San Diego, Calif. (3050), which had.merged June 11, 1970, under charter and title of the latter bank (3050). Themerged bank at date of merger had

Total assets

$31,745,184601,086,646

632,831,830

Banking offices

Inoperation

649

To beoperated

55


On March 2, 1970, Gateway National Bank, ElSegundo, Calif., and Southern California First Na-tional Bank, applied to the Comptroller of theCurrency for permission to merge under the charterand with the title of the latter.

Southern California First National Bank, withIPC deposits of $484 million, was established in1883 as the First National Bank of San Diego. Themarket area served by this bank encompasses thewhole of San Diego County, where it maintains33 of its 48 branches and has approval for fiveadditional offices, and also extends into Orange

County, where it maintains 9 offices, and into LosAngeles County, where 6 branches are located.

Gateway National Bank, with IPC deposits of$20 million, was established in 1964. In additionto its head office in El Segundo, this bank maintainsfour branches in Los Angeles County in the com-munities of Hawthorne, Manhattan Beach, Lawn-dale, and Lomita. Its primary market area, in whichit holds 3 percent of the area deposits, is the highlyindustrialized South Bay region of Los Angeles,extending from the Los Angeles International Air-port south to the Pacific Ocean and from HarborFreeway west to the Pacific. The area is fully de-

82


veloped residentially and industrially. Employmentis offered to local residents through numerous in-dustrial and manufacturing plants near the airportand throughout the southwestern portion of LosAngeles County.

The proposed merger will not result in a reduc-tion of an alternate source of banking services asthe charter bank is not presently represented withinthe market area of the merging bank. The nearestbranch of the charter bank to the merging bankis in the West Los Angeles area, approximately14 miles north of the merging bank's head office.Common depositor or borrower relationships, ifany, are negligible. In addition, the charter bank'sshare of the aggregate deposits in Los AngelesCounty will increase by only 0.13 percent to 0.29percent upon consummation of the merger. Thecompetitive position of the charter bank in SanDiego and Orange counties will remain unchanged.

Substantial competition now exists in the merg-ing bank's service area. The Bank of America main-tains 22 branches in the region and holds depositsof $283 million, and Security Pacific National Bank,which operates 13 branches, holds deposits of $127million. Other banks which stimulate competitioninclude United California Bank, with ninebranches, and Imperial Bank, with a head officeand one branch. The $2.5 billion Home Savingsand Loan and the $1.9 billion American Savingsand Loan are among 20 savings and loan institu-

tions with $9 billion in deposits in the South Bayarea. In view of the presence of a large number ofsizeable banking institutions and the fully devel-oped nature of the merging bank's service area,it is unlikely that the charter bank would establishbranches de novo in this section of Los Angeleswere the proposed merger disapproved.

It is concluded that the merger will have no ad-verse competitive effect and is in the public inter-est. The application, therefore, is approved.

APRIL 24, 1970.


First National operates six offices in Los AngelesCounty and nine offices in adjacent Orange County.Gateway Bank operates six offices in Los AngelesCounty. The main office of First National in SanDiego is approximately 110 miles southeast of Gate-way Bank's main office in El Segundo. However, theclosest Los Angeles County offices of the mergingbanks are 7 miles apart. The merger would, there-fore, appear to eliminate some direct competition.

First National and Gateway Bank were the 26thand 31st largest banks, respectively, of 64 banksoperating in Los Angeles County as of June 30,1968. Their shares of total county deposits were0.15 percent and 0.13 percent, respectively; themerged bank would hold 0.29 per cent. The mergerwould, therefore, not have an adverse effect uponcompetition.

BRISTOL COUNTY TRUST COMPANY, TAUNTON, MASS., AND T H E FIRST NATIONAL BANK OF ATTLEBORO, ATTLEBORO, MASS.


Bristol County Trust Company, Taunton, Mass., withand The First National Bank of Attleboro, Attleboro, Mass. (2232), whichmerged June 30, 1970, under charter of the latter bank (2232) and titleBristol County National Bank." The merged bank at date of merger had

had . ."First

Total assets

$3832

70

,417,267

,584

,295,252

,400

Banking offices

Inoperation

65

To beoperated

11


On January 22, 1970, The First National Bankof Attleboro, Attleboro, Mass., and the BristolCounty Trust Company, Taunton, Mass., appliedto the Comptroller of the Currency for permissionto merge with the charter of the former and withthe title "First Bristol County National Bank."

The applicant banks are both located in south-

eastern Massachusetts in Bristol County, which isdivided geographically, economically, and politi-cally into three separate areas. The trading area ofthe merging bank, the Bristol County Trust Com-pany, with IPC deposits of $26.4 million, is locatedin the central area where it operates six offices. Thecharter bank, The First National Bank of Attle-boro, with IPC deposits of $23.5 million, operates


its five offices in the northern section of BristolCounty.

Bristol County is heavily industrialized. Themanufacture of jewelry dominates the economy ofthe northern sector while machine tool and silvermanufacturing are the mainstays of the economyin the central area. The areas served by the appli-cant banks contain a population of approximately152,000, and moderate growth is expected.

Both banks share the problems of small bankslocated near large metropolitan areas. They haveexperienced difficulty in attracting managerial tal-ent because of their inability to offer salaries com-parable to those offered by the larger banks inBoston and Providence. Intense competition fortrust services comes from the metropolitan banks,and has curtailed the growth and variety of fidu-ciary services offered by the applicant banks. Themerger would permit the resulting bank to employfull-time trust personnel, a service available atneither of the two banks at the present time. Theincreased lending limit, as well as a greater varietyof specialized lending services, would be availableto meet the diversified needs of the corporate cus-tomers of both banks. Data processing services,likewise, would be improved and updated for thebenefit of the customers of both banks.

The merger will have no adverse effect on thefinancial structure in Bristol County. The countynow has 12 commercial banks. The First NationalBank of Attleboro holds 7.2 percent of the depositsin the county and 7.9 percent of the commercialbank loans. The Bristol County Trust Companyhas 8.3 percent of the commercial bank depositsand 8.9 percent of the loans. These figures do notinclude competition from savings banks, coopera-tive banks, and Federal Savings and Loan Associa-tions. When the deposits and loans of these institu-tions are considered in conjunction with commercialbank figures, the market percentage for depositsheld by the Bristol County Trust Company is 2.6percent, and by The First National Bank of Attle-boro is 2.27 percent. In addition, credit unions andpersonal loan companies also vie for lendable fundsand loan business, and commercial banks locatedoutside the county provide extensive competition.

The two banks compete with each other to aninsignificant degree. Although both banks operatebranches in the Seekonk area, there are few com-mon customers and very little overlap. Thosebranches, 5i/£ miles apart, are divided by geographicand economic boundaries. Both are located in sep-

arate shopping centers. Both banks have rejectedthe idea of branching into the service areas of theother bank in view of their lack of established cus-tomers, and in view of the entrenched competitionin the other areas. The charter bank has a historyof competing with banks to the north and towardRhode Island whereas the the Bristol County TrustCompany has attempted to compete to the east,west, and south of its headquarters.

It appears that the merger will have definitebenefits to the banking public and that no adversecompetitive effects are foreseen. Therefore, the mer-ger is approved.

MAY 8, 1970.


First National and Bristol Trust operate two ofthree banking offices in Seekonk (1960 population8,400), although in view of this town's location ona major highway about 4 miles from Providence,R.I., it is likely that banks in the latter city providealternatives to some customers. The other offices ofthe merging banks are located in their home com-munities some 14 miles apart; First National'sSouth Attleboro offices are somewhat farther fromTaunton. Although each of the home communitiesof the merging banks are served by other banks,there are no alternatives in the intervening area.It would appear that a limited amount of directcompetition between the merging banks would beeliminated by the proposed merger.

As Massachusetts law permits commercial banksto branch anywhere in their home counties, themerger may foreclose the possibility of increasingcompetition between the two banks.

Although the areas primarily served by the merg-ing banks are not substantially coextensive, theircompetitive overlap justifies examination of theincreased concentration in northern Bristol County,the broader area which will comprise the servicearea of the resulting bank. As of June, 1968, fivebanks operated in the northern part of the county.Bristol Trust and First National are the largest andsecond largest of these banks, controlling about25 percent and 23 percent of total deposits in thisarea. One of the three other banks in northernBristol County, Manufacturers National Bank ofBristol County, North Attleboro, is an affiliate ofthe $1.2 billion Baystate Corp., one of two regis-tered bank holding companies operating in Massa-chusetts.

In view of the elimination of some direct com-


petition and the noted increase in concentration incommercial banking in northern Bristol County,

we conclude that the proposed merger would havean adverse effect on competition.

FIRST NATIONAL BANK OF SOUTH JERSEY, EGG HARBOR TOWNSHIP, N.J., ANDTHE FIRST NATIONAL BANK OF WILLIAMSTOWN, WILLIAMSTOWN, N J.


Banking offices

Inoperation

To beoperated

The First National Bank of Williamstown, Williamstown, NJ. (7265), withand First National Bank of South Jersey, Egg Harbor Township, NJ. (1326),which hadmerged June 30, 1970, under charter and title of the latter bank (1326). Themerged bank at date of merger had

$15,976,524

256,385,345

272,361,869

3

21

24


On February 24, 1970, the First National Bankof South Jersey, Egg Harbor Township, N.J., ap-plied to the Comptroller of the Currency for per-mission to merge with The First National Bank ofWilliamstown, Williamstown, N.J., under thecharter and with the title of the former.

The First National Bank of South Jersey, thecharter bank, was organized in 1822, and convertedto a National charter in 1865. The charter bank,which operated as the Boardwalk National Bankof Atlantic City and assumed its present name De-cember 1, 1969, has total resources of $255 millionand operates 21 offices in Atlantic County and 1office in Salem County.

Atlantic County, the principal market area of thecharter bank, is located in the southern portion ofthe State. The county covers an area of 566 squaremiles and has a population of approximately 188,000, 30 percent of which is located in Atlantic City.The eastern portion of the county fronts on theAtlantic Ocean and has long been a popular resortand recreation area. The central and western por-tions of the county are comprised of woodland andfarm areas that produce fruits and garden vegeta-bles. Continued growth is anticipated as the wood-lands nearer to the cities are rapidly being devel-oped into building lots and industrial parks.

The First National Bank of Williamstown, themerging bank, has total assets of $14 million, andoperates two offices in Williamstown and one officein Turnersville. All offices of the merging bankare located in Gloucester County, northwest ofAtlantic County.

Gloucester County covers an area of 328 squaremiles which borders on the Delaware River. Thepopulation of the county is estimated at 167,200.Industrial activity is concentrated in the westernportion of the county. Petroleum refining andchemical manufacturing are the leading industries.The economy of the eastern part of the county ismainly dependent on cash crop farming. Continuedindustrial and residential growth is anticipated asimproved highways are completed, making the areamore accessible to the Camden-Philadelphia area.

Competition between the charter and mergingbanks is minimal. The main offices of the subjectbanks are 35 miles apart and the closest branchoffices are 10 miles apart. There are approximately70 banks operating in the Third Banking District.Many of these banks have offices intervening be-tween the subject banks. The charter bank's posi-tion as third largest bank in the district will be un-changed by this merger. Although potential com-petition through de novo branching exists, it islimited by the scarcity of suitable or legal locations.

Consummation of the proposed merger will pro-vide new and improved services to present and po-tential customers in the Williamstown area, includ-ing a larger lending limit, sophisticated computerservices, and a trust department. The merger willalso provide the bank with the management re-sources and depth needed to better serve the com-munity.

Applying the statutory criteria to the proposedmerger, we conclude that it is in the public interestand the application is, therefore, approved.

MAY 15, 1970.

at;



The closest offices of the merging banks are ap-proximately 11 miles apart. There are a numberof banking offices located between these twobranches. It would appear that only a limitedamount of existing competition would be elimi-nated by the proposed merger.

Under New Jersey law, commercial banks mayopen de novo branches or operate branch officesacquired through merger anywhere in the bankingdistrict in which they are located. Subsequent tothe recent changes in New Jersey law, larger com-mercial banks in the State have embarked on ex-tensive market expansion programs, both throughde novo branching and through merger. We con-sider it important that the larger banks in a givendistrict enter new areas either de novo or throughmerger with smaller banks, thereby preservingleading local banks, most capable of remainingsubstantial competitive alternatives.

The merging banks are located in the ThirdBanking District, which is comprised of New Jer-sey's eight southernmost counties. Accordingly,they could be permitted to open de novo offices inareas served by each other, where not restricted byNew Jersey's home and branch office protectionlaws. In view of its resources, extensive de novobranching by First of Williamstown is unlikely.First of South Jersey, however, is the third largestbank in the district and has the resources to opennew offices where possible. Because of the presenceof the home office of First of Williamstown, First ofSouth Jersey could not be permitted to open ade novo office in that community. Other parts of

northern Gloucester County, where First of Wil-liamstown's other branch is located, may becomeclosed to de novo branching if new banks arechartered, but it is noted that other large banksin the district have applied for persmission to opende novo offices in townships in this part of thecounty.

Gloucester County has seen substantial reorgani-zation of its banking community in the past fewmonths. Two of its larger banks have been mergedinto banks based in Camden County. Three local-ized banks, including the county leader, are merg-ing with one another. One of the smaller banks inthe county is merging with another small bank inneighboring Salem County. First of Williamstownwill be the seventh to become party to a mergeragreement, and the third to be merged into one ofthe largest of some 70 banks operating in the ThirdBanking District. First of Williamstown presentlyholds the fifth largest share of commercial bankdeposits in Gloucester County, about 6.5 percent,and is the third largest bank headquartered in thecounty.

While First of South Jersey is one of the district'slargest commercial banks, controlling about 9 per-cent of total commercial bank deposits therein, andclearly one of the more likely new entrants into thebanking markets of Gloucester County, it will notacquire a dominant position in the county throughthe proposed merger. Although some de novobranching is possible, in view of the size and rela-tive market position of the acquired bank, the pro-posed merger is unlikely to have a significantlyadverse effect on potential competition.

FIRST NATIONAL BANK OF WESTMORELAND, GREENSBURG, PA., AND THE PEOPLES NATIONAL BANK OF TARENTUM, TARENTUM, PA.


First National Bank of Westmoreland, Greensburg, Pa. (14055), withand The Peoples National Bank of Tarentum, Tarentum, Pa. (5351), which had.consolidated June 30, 1970, under charter of the latter bank (5351) and title"Southwest National Bank of Pennsylvania." The consolidated bank at date ofconsolidation had

Total assets

$78,418,69226,640,833

105,059,524

Banking offices

Inoperation

63

To beoperated

9


On February 19, 1970, the First National Bankof Westmoreland, Greensburg, Pa., and The Peo-ples National Bank of Tarentum, Tarentum, Pa.,

applied to the Comptroller of the Currency forpermission to consolidate under the charter of thelatter and with the title of "Southwest NationalBank of Pennsylvania."

86


The Peoples National Bank of Tarentum, withIPC deposits of $21.3 million, was chartered in1900. It operates two branches and has two ap-proved but unopened branches. This bank is ingood condition but faces a management successionproblem owing to the anticipated retirement of anumber of its senior officers in the near future andlack of personnel within the bank capable of re-placing them.

The market area of the charter bank lies approx-imately 18 miles northeast of the city of Pittsburgh,along the Allegheny River. This area consistsmainly of Allegheny County, the upper portion ofwhich is known as the Allegheny Valley area, andparts of Butler, Armstrong and Westmorelandcounties. The 1960 population of the area, whichconsists of approximately 19 boroughs and town-ships, was 118,833. The area economy consists ofhighly diversified manufacturing, with the steel andglass industries as the largest industrial employers.The Allegheny Valley is one of the few areas in thecounty that has not been urbanized and is availablefor future residential developments. Completion ofa new super-highway should rapidly increase arearesidential development.

The First National Bank of Westmoreland, theconsolidating bank, with IPC deposits of $62.1million, was chartered in 1881. It operates fivebranches and has two approved but unopenedbranches. The condition of this bank is very good.Its management is excellent and it has an adequatenumber of middle management personnel capableof replacing the top management of the charterbank when they retire.

The primary service area of the bank consists ofgreater Greensburg and central WestmorelandCounty. Westmoreland County has a populationof 387,000, while the Greater Greensburg Area con-tains a population of 53,409 inhabitants. Econom-ically, the area is highly diversified, with over 107industries operating there. Greater Greensburg isthe commercial center for a substantial residentialregion, and harbors a majority of the professionaltrade. Originally, the area was a prosperous coalmining center but exploitation has resulted in itsultimate depletion. The area served by the con-solidating bank's most outlying branches is charac-terized by new and rapid development.

Banking competition in the areas of both banksis extremely keen. The two banks claim to be find-ing it increasingly difficult to compete for depositsagainst Mellon National Bank and Trust Company,

with resources of $4.9 billion, and Pittsburgh Na-tional Bank, with resources of $1.7 billion. Amongbanks presently operating in the combined servicearea, the charter bank ranks ninth, and the con-solidating bank ranks fifth. The fourth largestbank, The Union National Bank of Pittsburgh,with total deposits of $698 million, is considerablylarger than the fifth ranked bank.

Consummation of this proposal will benefit thecustomers of both banks through the greater avail-ability of lendable funds, a larger lending limit,trust services for customers of the charter bank,and the better, less expensive services that normallyarise out of economies of scale. In addition, theimminent management succession problem of thecharter bank will be solved through the availabilityof well-trained and -developed middle managementto replace the top management of the charter bankwhen they retire.

Competition will not be adversely affected. Asthe service areas of the two banks are separate anddistinct and do not overlap, little, if any, compe-tition between the banks will be eliminated. Al-though one alternative banking source in the com-bined service area will be eliminated, adequatealternatives remain. The consolidated bank willrank as fifth largest in the combined service area,the same position as now occupied by the consoli-dating bank. Competition will be enhanced becausethe slightly larger and stronger consolidated bankwill be better able to compete with the large Pitts-burgh-based banks operating in the area than caneither consolidating bank operating alone.


MAY 15, 1970.


The home offices of the two banks are 25 milesapart. The Delmont office of First National and thehome office of Peoples National are 18.8 road milesapart. Distance, topography, and intervening bank-ing facilities apparently negate the existence ofsubstantial competition between them.

Considerable penetration into Allegheny andWestmoreland counties by the branching of largePittsburgh banks has taken place. Peoples Nationalin Tarentum competes with offices of Union Na-tional of Pittsburgh (assets $657 million) and West-ern Pennsylvania National (assets $747 million).First National competes with Mellon National

87


(assets $3.8 billion), Pittsburgh National (assets $1.3billion), Union National and Western PennsylvaniaNational.

As of December 31, 1968, Peoples National ac-counted for $6.4 million, or 0.3 percent, of IPCdemand deposits and $21.3 million, or 0.4 percent,of total deposits in Allegheny County. At the sametime, First National held $20.8 million, or 13.4 per-cent, of IPC demand deposits and $61.8 million, or11.3 percent, of total deposits in WestmorelandCounty.

The bank resulting from the proposed consolida-tion would be the fifth largest in the general Pitts-

burgh area, but would be substantially smaller thanthe four larger banks.

Pennsylvania law permits unrestricted branchingwithin a bank's home county and into contiguouscounties. Cross-county branching trends indicateincreasing competitive pressure on smaller banksby the large Pittsburgh-based banks, which, for ex-ample, operate 35 branches in WestmorelandCounty.

In view of the sizes of the towns and of the com-peting banks already in the area, it is not believedthat this consolidation would have a significantlyadverse effect on potential competition.

STATE BANK OF WHITING, WHITING, IND., AND THE FIRST NATIONAL BANK OF CEDAR LAKE, CEDAR LAKE, IND.


State Bank of Whiting, Whiting, Ind., withand The First National Bank of Cedar Lake, Cedar Lake, Ind. (14813), whichhadconsolidated June 30, 1970, under charter of the latter bank (14813) and title"Northwest Bank of Indiana, National Association." The consolidated bank atdate of consolidation had

Total assets

$23,399,108

7,984,358

31,383,466

Banking offices

Inoperation

2

2

To beoperated

4


On March 11, 1970, The First National Bank ofCedar Lake, Cedar Lake, Ind., with IPC depositsof $7.8 million, and the State Bank of Whiting,Whiting, Ind., with IPC deposits of $22 million,applied to the Office of the Comptroller of theCurrency for permission to consolidate under thecharter of the former and with the title of "North-west Bank of Indiana, National Association." Per-mission was also requested to locate the consoli-dated bank's main office in Whiting, Ind.

The First National Bank of Cedar Lake, CedarLake, Ind., was chartered in 1957, and opened itsonly branch office on February 15, 1967, severalmiles north of Cedar Lake in St. John, Ind. CedarLake is a rural town about 32 miles southeast ofChicago, 111., and 23 miles south of Whiting, Ind.The area immediately surrounding Cedar Lake isprimarily agricultural, with some residential devel-opment. The economy of the town is highly de-pendent upon the large industrial complexeslocated in the Gary-Hammond-East Chicago area.The population of the town is presently estimatedat 6,900 and growth is expected as inhabitants of

the industrial areas contiguous to Chicago seekthe more rural residential atmosphere that CedarLake affords. In addition, nearby Cedar Lake is asummer resort haven. St. John reflects the samerural residential characteristics as Cedar Lake.

The State Bank of Whiting, Whiting, Ind., isin the extreme northwest corner of Lake County,adjacent to metropolitan Chicago and bordering onLake Michigan. The bank was chartered in 1931,and presently operates one branch in Highland,Ind., about 9 miles south of Whiting. Whiting,with a population of about 8,000, is a highly indus-trialized town, whose economy is supported by em-ployers such as Standard Oil Company of Indiana,Sinclair Refining Company, Youngstown Sheet andTube Company, Inland Steel Company, and Ameri-can Steel Foundry.

Lake County is serviced by 13 commercial banks,with aggregate deposits in excess of $765 million.In addition, there are numerous savings and loanassociations, credit unions, and finance companiesoperating in the participating banks' trade areas.Competition is also felt from the much largerChicago-based banks that solicit business in the

88


Lake County service area. Within its primary serv-ice area contiguous to Whiting, the State Bank ofWhiting competes with six commercial banks thattogether operate 21 branch offices. There are nocommercial banks or branches within the primarymarket area of First National Bank of Cedar Lake.Approval of the proposed consolidation will causeno undue concentration of banking assets in theresulting bank, and will leave a substantial choiceof alternative sources of commercial bankingservices.

Competition between the consolidating banks isvirtually nonexistent due to the distance separatingtheir offices and the presence of intervening banks.Furthermore, neither bank appears to be a likelypotential entrant to the service area of the otherdue to the factors of distance, expense, and thehome-office protection provisions of the Indianabranch banking law.

The proposed consolidation will provide thecharter bank's customers with an increased rangeof banking services, including trust services, and ahigher lending limit. In addition, management con-tinuity will be assured for the charter bank.

Applying the statutory criteria to the proposedconsolidation, we find, that it is in the publicinterest, and the application, therefore, is approved.

MAY, 15, 1970.


Fourteen commercial banks with 57 bankingoffices are located in Lake County (an area whichprobably overstates the relevant market). The near-est branches of the merging banks are about 6 milesapart, and branches of three of the county's largestbanks are located in the intervening area. The headoffices of the merging banks are 23 miles apart andthere are 26 other banking offices in this area.

Neither of the merging banks derives significantbusiness from the areas served by the other. Hence,this proposed merger would appear to eliminateonly a limited amount of direct competition be-tween the merging banks.

In response to rapid population migration south,State Bank recently established a branch in High-land, approximately 12 miles south of Whiting.Under Indiana law, which permits countywidebranching, State Bank could establish additionalbranches in the growing southern half of thecounty. The proposed merger, of course, eliminatesState Bank as a potential competitor in those areaspresently served only by First National. However,because of the size and number of other potentialcompetitors, this proposed merger would not ap-pear to entail the loss of substantial potential com-petition.

State Bank and First National are, respectively,the 8th and 13th ranked of 14 banks located inLake County. They hold approximately 4 percentand 1.1 percent of county total deposits of $748.1million. The proposed resulting bank will be theseventh largest bank in the county, with about 5percent of county total deposits.

Commercial banking is concentrated in LakeCounty. The largest bank holds about 31 percent,and the four largest banks hold about 66 percentof county total deposits.

The proposed merger will have little effect onthis existing high level of concentration.

The proposed merger would eliminate only alimited amount of direct competition and onlyslightly affect concentration in commercial bankingin Lake County. Thus, we conclude that it is un-likely that this proposed merger would have a sub-stantially anticompetitive effect.

T H E M E R C H A N T S N A T I O N A L B A N K OF A L L E N T O W N , A L L E N T O W N , P A . , AND T H E FOGELSVILLE N A T I O N A L B A N K , FOGELSVILLE, P A .


The Fogelsville National Bank, Fogelsville, Pa. (12975), withand The Merchants National Bank of Allentown, Allentown,hadmerged June 30, 1970, under charter and title of the lattermerged bank at date of merger had

Pa. (6645), which

bank (6645). The

Total assets

$20,875

185,639

206,538

,731

,802

,179

Banking offices

Inoperation

2

13

To beoperated

15

89



On December 15, 1969, The Fogelsville NationalBank, Fogelsville, Pa., and The Merchants NationalBank of Allentown, Allentown, Pa., applied to theComptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

The Merchants National Bank of Allentown,with IPC deposits of $136.8 million, was charteredin 1903. It operates 12 branches and its head officein Lehigh County.

Allentown, home office city of the charter bank,is situated in the southeast portion of LehighCounty in eastern Pennsylvania, some 62 milesnorth of Philadelphia, and 36 miles northeast ofReading. Allentown, with a 1960 population of108,000, is the fourth largest city in Pennsylvania,and is the center of the third largest trading areain the State; the trading area has a population of250,000. The economy of that area is mixed withindustry, commerce, agriculture, construction, andgovernment all contributing.

Included among the charter bank's competitorsin Allentown and its broader trading area in Le-high County and the Lehigh Valley are the Indus-trial Valley Bank of Jenkintown, with total re-sources of about $441.7 million; the $220 millionBank of Pennsylvania in Reading, which recentlyopened a new branch in Allentown; and the $239million First National Bank of Allentown. Of thefour banks presently operating in Allentown, thecharter bank is the smallest. Other competitors inthe Lehigh Valley area include the $623 millionContinental Bank and Trust Company, Norris-town; the $497 million American Bank and TrustCompany of Pa., Reading; and the billion dollarPhiladelphia banks, as well as various other locally-based banks. Substantial competition is also gener-ated by savings and loan associations, insurancecompanies, factors, direct lending agencies of thegovernment, and the 26 personal loan and salesfinance companies vying with commercial banksfor loans and deposits in the area.

The Fogelsville National Bank, with IPC de-posits of $16.3 million, was chartered in 1926. Inaddition to its home office, it operates one branchat Wescosville. While management of this bank isgood, its two senior officers are nearing retirementage and the younger men being groomed as theirsuccessors will not be ready to replace them by thetime they retire.

Fogelsville, home of the merging bank, is a smallcommunity with 766 residents located 12 miles westof Allentown in Lehigh County. Wescosville, wherethe bank's only branch operates, is 7 miles south-east of Fogelsville. Although the economy of thearea is basically agricultural and residential, sub-stantial economic growth is anticipated in the merg-ing bank's service area. Three major firms—F&MShaeffer Brewing Company, Olin-Mathieson, andKraft Foods—plan to locate in the area. Construc-tion has already begun on the Olin-Mathiesonplant, and construction by the other two companieswill begin this year.

Primary competition for the merging bank comesfrom the First National Bank of Allentown, whichhas two branch offices in its area, one at Macungie,7 miles south, and the other at Trexlertown 3 milessouth. There is an overlap of the trade areas ofthe merging bank and the New Tripoli NationalBank, New Tripoli, Pa.

Consummation of this merger will solve themerging bank's management succession problemand will make available to its customers a numberof services not presently offered, including a trustand estate planning department, automated cus-tomer services, and a greater borrowing capacity.The resulting institution will be more capable ofcontributing to the imminent expansion of theFogelsville economy than can the merging insti-tution.

The effect of this merger on competition will notbe significantly adverse. Because the nearest officesof the two banks are 5 miles apart, and their mainoffices are 12 miles apart, there is some competitionbetween them which will be eliminated. However,because of the large number of institutions in thegeneral area, and the fact that the merging bank'sactivity is confined primarily to the immediateFogelsville and Wescosville area, it is not believedthat such competition is significant. This merger,by introducing offices of the charter bank to thepresent trade area of the merging bank, will en-hance competition with local branches of the FirstNational Bank of Allentown. While the resultingbank will remain the fourth largest bank in Allen-town in terms of its share of deposits and loans, itwill be better able to compete with the larger banksoperating in the valley area.

It is concluded, in the light of the statutory cri-teria, that the merger is in the public interest. It is,accordingly, approved.

APRIL 30, 1970.

90



The home offices of the two banks are 12 milesapart. Fogelsville Bank's branch office at Wescos-ville, however, is 5 miles from Merchant's closestoffice. Fogelsville and Wescosville are two smallvillages west of Allentown, each with a populationof approximately 750.

According to the application, Merchants drawssignificant deposits from the immediate areas servedby Fogelsville Bank in the small communities ofFogelsville and Wescosville; therefore, it wouldappear that the proposed merger would eliminatesignificant direct competition in these two local

areas. Fogelsville Bank also appears to draw asignificant proportion of its total deposits fromAllentown, but it would not appear to be a majorcompetitive factor in this much larger market.

Merchants is the second largest bank in theLehigh County-Bethlehem County area; accordingto data for June 30, 1968, it accounts for about 20.5percent of this market. It is acquiring a small localbank located in Lehigh County, and in so doing iseliminating direct competition in the immediatecommunities served by the latter. For these reasons,we conclude that the proposed merger would havean adverse effect on competition.

ZIONS FIRST NATIONAL BANK, SALT LAKE CITY, UTAH, AND BANK OF ST. GEORGE, ST. GEORGE, UTAH


Bank of St. George, St. George, Utah, withwas purchased June 30, 1970, by Zions First National Bank, Salt Lake City,Utah (4341), which hadAfter the purchase was effected, the receiving bank had

Total assets

$15,754,231

272,307,425288,061,656

Banking offices

Inoperation

3

18

To beoperated

21

For "Comptroller's Decision" and "Summary ofReport by Attorney General" see Zions First Na-

tional Bank, Salt Lake City, Utah, and Bank ofCommerce, Magna, Utah, May 29, 1970, pp. 76-77.

THE FIRST NATIONAL BANK OF EBENSBURG, EBENSBURG, PA., AND THE PEOPLES BANK OF CLYMER, CLYMER, PA.


The Peoples Bank of Clymer, Clymer, Pa., withand The First National Bank of Ebensburg, Ebensburg, Pa. (5084), which had. . .merged July 1, 1970, under charter and title of the latter bank (5084). Themerged bank at date of merger had

Total assets

$4,419,24740,939,058

45,358,305

Banking offices

Inoperation

15

To beoperated

6


On March 31, 1970, The Peoples Bank of Clymer,Clymer, Pa., and The First National Bank ofEbensburg, Ebensburg, Pa., applied to the Comp-troller of the Currency for permission to mergeunder the charter and with the title of the latter.

The Peoples Bank of Clymer, Clymer, Pa., a unitbank, was chartered in 1920. The bank presentlyholds IPC deposits of $2.8 million, and is the only

commercial bank serving Clymer. With its currentleadership at, or near, retirement age, the bankmust provide for management succession. Thebank's growth record in recent years has reflectedthe unstable economy of its service area and theunaggressive character of its management. Clymer,with a population of 7,251, is located in IndianaCounty, in the heart of the coal region of westernPennsylvania. The community's economy is totally

91


dependent on coal, and presently, with a resur-gence in the demand for coal, the town is enjoyinga wave of prosperity.

The First National Bank of Ebensburg, Ebens-burg, Pa., was organized in 1897, and presentlyoperates five banking offices and holds IPC depositsof $29.2 million. Under youthful and aggressivemanagement, the charter bank has experiencedrapid growth in the past decade.

Ebensburg, with a population of about 5,000people, serves as the county seat of CambriaCounty. The service area of the bank encompassesthe central portion of the county where approxi-mately 25,000 people reside. The city is situated oneast-west U.S. Route 22, a factor which strengthensits position as the political and geographical centerof Cambria County. Ebensburg and the surround-ing towns have, for many years, been dependentupon the coal industry, but the cyclical nature ofthis industry has prompted the area to broaden itseconomic base. Businesses such as the KimbalEngineering Company, which employs 220, and theStevens Manufacturing Company, which employs375, have entered this area. The State of Pennsyl-vania also maintains a school for the mentally re-tarded in the Ebensburg area, thus employing ap-proximately 1,000 people. The outlook for coalmining has improved since the Barnes and TuckerCoal Company, one of the area's major employers,contracted with Pennsylvania Power and LightCompany to supply their fuel needs until the year2010. Tourism is also gaining some importanceas a seasonal industry. Some Ebensburg residentscommute to Johnstown, an industrial-commercialcity of 54,000, located about 15 miles southwest ofEbensburg.

There is no competition between the partici-pating banks whose offices are located in differentcounties and serve different markets. While thecharter bank's Barnesboro office is only about 12miles from the merging bank, the difficulty of traveland the unaggressive management of the mergingbank have effectively precluded the development ofcompetition between them. The effect of thismerger will be to stimulate banking competition inthe service area of the merging bank by substitut-ing for it, an office of an aggressive, competitivecommercial bank responsive to the banking needsof the community.

When the merger is consummated, the charterbank will retain its rank as third largest commer-cial banking institution in the Johnstown-Ebens-

burg area, operating 5 of the 47 existing bankingoffices. The trade area's two largest commercialbanks are headquartered in Johnstown, the $134million U.S. National Bank and the $57 millionJohnstown Bank and Trust Company. Additionalcompetitors within the charter bank's service areainclude the $49 million Johnstown Savings Bank;the Cambria Savings and Loan, Barnesboro, Pa.;the Ritter Finance Company; and the CambriaThrift Company of Ebensburg.

The banking public in the merging bank's serv-ice area will benefit from the availability of an in-creased range of banking services following thismerger. The lending limit of the merging bank atthe present time is $30,000; however, the resultinginstitution will have a lending capacity of $300,000,permitting it to service most individual and cor-porate credit needs in its market. A full range ofdeposit services, at maximum legal interest rates,will be made available in the merging bank's serv-ice area. Trust services, not now offered by themerging bank, will be introduced through theresulting bank. Electronic data processing will beutilized, and plans to modernize and upgrade theClymer office are being formulated.


JUNE 1, 1970.


The home offices of the two banks are 25 milesapart. Two of First National's branches, however,are 12 and 16 miles east of Clymer, and it may bepresumed that some competition exists betweenthem and Peoples Bank. Distance and interveningbanking facilities probably minimize the amountof competition between Peoples Bank and FirstNational's main office at Ebensburg.

First National competes with U.S. National Bankof Johnstown (assets $132 million) and JohnstownBank and Trust Company (assets $53 million) bothof which maintain branches in the vicinity ofEbensburg.

As of December 31, 1968, First National ac-counted for 11 percent of total commercial bankdeposits in Cambria County, and Peoples Nationalheld 3 percent of total deposits in Indiana County.

Although Pennsylvania law permitting unre-stricted branching within a bank's home countyand into contiguous counties would allow FirstNational to branch into Clymer, the size of the

92


town together with its present economic situation not have a significantly adverse effect on compe-would be obvious deterrents. tition.

We conclude that the proposed merger would

THE IDAHO FIRST NATIONAL BANK, BOISE, IDAHO, AND FIDELITY NATIONAL BANK OF TWIN FALLS, TWIN FALLS, IDAHO


Fidelity National Bank of Twin Falls, Twin Falls, Idaho (11100), withand The Idaho First National Bank, Boise, Idaho (1668), which hadmerged July 1, 1970, under charter and title of the latter bank (1668). Themerged bank at date of merger had

Total assets

$27,413,294500,740,908

526,045,759

Banking offices

Inoperation

450

To beoperated

54

The "Comptroller's Decision" and the "Summary peared in the 1969 Annual Report under the head-of Report by Attorney General" for this case ap- ing "Approved, but in litigation/'

NATIONAL BANK OF NORTH AMERICA, N E W YORK, N.Y., AND TRADE BANK AND TRUST COMPANY, N E W YORK, N.Y.


Trade Bank and Trust Company, New York, N.Y., withand National Bank of North America, New York, N.Y. (7703), which hadconsolidated July 6, 1970, under charter and title of the latter bank (7703). Theconsolidated bank at date of consolidation had

Total assets

$230,671,7311,711,720,943

1,942,392,675

Banking offices

Inoperation

795

To beoperated

102


On March 31, 1970, Trade Bank and TrustCompany, New York, N.Y., and National Bank ofNorth America, New York, N.Y., applied to theOffice of the Comptroller of the Currency for per-mission to consolidate under the charter and withthe title of the latter.

National Bank of North America, New York,N.Y., with IPC deposits of $1.2 billion, was orga-nized in 1905, and currently operates 91 offices inNew York City and Long Island, and one office inNassau, in the Bahama Islands. Presently the bank'soperations are centered in Nassau County, where itmaintains 47 offices. In addition, the bank now hasnine branches in Manhattan and three offices inGreat Neck, one of which is a drive-in facility thathas been condemned by the town for use as munici-pal parking.

Trade Bank and Trust Company, New York,

N.Y., with IPC deposits of $206.1 million, was or-ganized in 1922, and presently operates six offices,five of which are located in central and lower Man-hattan, while one is located in Great Neck, LongIsland. It also has one approved but unopenedbranch on the east side of mid-Manhattan.

Although quite large by most standards, the con-solidating bank is small compared to other NewYork City banks, and lacks a lending limit ade-quate to service all of its customers' needs. Whilethe Trade Bank and Trust Company offers mostof the services offered by New York banks, some areoffered only on a limited scale.

The borough of Manhattan is the center ofactivity for both banks. An island of apartmentbuildings, offices, stores, and small factories, Man-hattan is surrounded by the most important dock-ing facilities for ocean going ships in the world, andis truly the world center of financial and commer-


cial activity. At present an estimated 1.5 millionpeople reside in Manhattan, and more than 2.6million are employed there. All of the consoli-dating bank's Manhattan offices are located in thearea below 60th Street, the center of most of Man-hattan's commercial activity. In this area are foundmost of New York City's world-renowed drama, art,and musical centers, as well as the garment andjewelry centers. Chinatown, the site of TradeBank's southernmost branch, is in the lower endof Manhattan, and is comprised of just a fewblocks.

Nassau County, in which most of National Bankof North America's branches are located, has anestimated population of 7.6 million persons, andis essentially a residential and commercial areacontaining very little industrial activity. GreatNeck, N.Y., where three of the charter bank's officesand one of the consolidating bank's are located, issituated in the northwest corner of the county andis principally a residential community with a popu-lation of about 44,000. Housing in the area con-sists of single family dwellings in the $40,000 range,from which most residents commute to other areasof Long Island and New York City for employ-ment.

There are currently 54 commercial banks operat-ing in Manhattan, 10 of which, with a total of 313offices, are larger than the National Bank of NorthAmerica. In Great Neck, six commercial banks,excluding the charter bank, operate within a fewblocks of the consolidating bank's offices; five ofthose banks have total resources in excess of thoseheld by the National Bank of North America.Trade Bank and Trust Company's branch is thesmallest and least impressive office in the area. Asof June 30, 1969, National Bank of North Americaheld 1.57 percent of the total resources of commer-cial banks located in New York City and LongIsland, and 2.04 percent of the total deposits ofthose banks; Trade Bank and Trust Company'sresources were 0.25 percent and its deposits 0.31percent of the same totals. When deposits and loansof mutual savings banks and savings and loan insti-tutions in the New York City-Long Island area areincluded, National Bank of North America's shareamounts to 1.34 percent of total deposits and 1.1percent of total loans. Additional competition isfelt from insurance companies, credit unions, fac-tors, and personal loan companies.

Approval of this consolidation will improve serv-ice offered to present customers of Trade Bank and

Trust Company by making available to them alarger lending limit, more loanable funds, an estab-lished international banking department, and morecomplete trust services, as well as the other bankingservices offered by the charter bank which are notavailable through the consolidating bank. Theexecutive recruitment and training program willprovide management succession to the consolidat-ing bank. The charter bank, which is losing one ofits Great Neck offices as a result of condemnationproceedings, will have it replaced by the GreatNeck office of the consolidating bank locatednearby, and will not thereby lose any customers.

Competition will not be adversely affected by thisconsolidation. Although both banks are in the samegeneral market area, because of the patterns ofcompetition in this densely populated area, andbecause the consolidating bank is oriented princi-pally towards commercial business, there is thoughtto be little competition between them. Althoughone banking alternative will be eliminated by theconsolidation, adequate alternatives will remain.The consolidation should have a tendency to en-hance competition between the resulting institutionand the mammoth New York banks. However, thecharter bank's rank among commercial bankslocated in Manhattan will not change as a resultof this transaction. Banking competition in GreatNeck should be stimulated by replacing the con-solidating bank, which is the smallest bankingoperation in the area, with a branch of the muchlarger institution. Potential competition will not beaffected since expansion by branching in the Man-hattan area is prohibitive due to the enormousrentals, staffing problems, and start-up costs whichwould be involved in such a move.

Applying the statutory criteria, we find the con-solidation to be in the public interest, and the ap-plication, therefore, is approved.

JUNE 3, 1970.


The main offices of the consolidating banks arein different boroughs of New York City, but severalof their branch offices are in close proximity. Al-though there are a large number of other compet-ing banks with offices nearby, it is clear that theproposed merger would eliminate direct competi-tion between the consolidating banks.

NBNA presently is the 11th largest commercialbank operating in New York City, and its positionwould be unchanged following the proposed con-

94


solidation. As of June 30, 1968, NBNA held about0.6 percent of the total deposits held by commercialbanks in New York County (Manhattan) andTrade Bank held about 0.4 percent of suchdeposits. As of the same date, NBNA held approxi-mately 19.7 percent of the total deposits held by

commercial banks in Nassau County, and TradeBank held about 0.2 percent of such deposits.

We conclude that this consolidation would elimi-nate direct competition between the participantsbut that it would not have a significantly adverseeffect on competition.

PEOPLES NATIONAL BANK OF WASHINGTON, SEATTLE, WASH., AND LANGLEY STATE BANK, LANGLEY, WASH.


Langley State Bank, Langley, Wash., withwas purchased July 6, 1970, by Peoples National Bank of Washington, Seattle,Wash. (14394), which hadAfter the purchase was effected, the receiving bank had

Total assets

$3,941,855

432,596,659436,538,514

Banking offices

Inoperation

2

49

To beoperated

51


On March 16, 1970, Peoples National Bank ofWashington, Seattle, Wash., applied to the Officeof the Comptroller of the Currency for permissionto purchase the assets and assume the liabilities ofLangley State Bank, Langley, Wash.

Peoples National Bank of Washington, Seattle,Wash., was organized in 1889, and now holds IPCdeposits of $350.5 million, and operates 49 branchesscattered throughout the State. The bank also hasfive approved but unopened branches in KingCounty.

Seattle, the home office of the charter bank, hasa population estimated at 591,000 people. Situatedon Puget Sound, this city has one of the WestCoast's finest natural deep-water harbors, and isfully capable of handling the world's largest ships.The economy of the area has experienced tremen-dous growth over the last 10 years, due primarilyto the growth of the aerospace industry. Newsurges in industrial, commercial, and residentialgrowth have taken place as a result in the generalarea. Large capital outlays have been made foreducational institutions, highways, bridges, airports,harbors, and other public facilities to meet thearea's expanding requirements. However, the aero-space industry has recently experienced substantialcutbacks which have caused the area's economy toslow its growth.

The purchasing bank is third largest in terms ofdeposits among the 94 commercial banks competingin Washington. Seattle-First National Bank in

Seattle, is the State's largest bank, with deposits of$1.7 billion, and 134 banking offices. The NationalBank of Commerce of Seattle, with deposits ofslightly over $1 billion, and 96 banking offices, isthe second largest. Other banks with statewideoperations include the National Bank of Washing-ton in Tacoma, with $381 million in deposits and44 offices, and Old National Bank of Washingtonin Spokane, with $269 million in deposits and 38offices.

Langley State Bank was established on June 30,1913, and now holds IPC deposits of $3.3 million.It opened its only branch on July 10, 1965, at Free-land, and is presently ranked as 66th among Wash-ington's 94 commercial banks. The selling bankhas been able to capture only 20 percent of theloans generated in its trade area, despite the factthat it is relatively free of competition. The bank'scustomers are not afforded a wide range of bankingservices and the bank lacks management succession.

Langley and Freeland are both located at thesoutherly portion of Whidbey Island, the thirdlargest island in the continental United States. Thepopulation of the island is estimated at 23,000 peo-ple, with the bulk of the residents concentrated atthe northern end. There are three incorporatedtowns on the island, the largest of which is OakHarbor, in the north, with 9,000 residents. Coupe-ville, located in the island's middle portion, has800 people, while Langley, in the south, has about539 residents. The largest employer on the islandis the U.S. Navy, which has a base at Oak Harbor

95


with a total complement of about 6,000 persons.The service area of the selling bank, located at thesouthern end of the island, is sparsely populatedand has an economy devoted mainly to lumbering,with some diversification provided by agricultureand tourism. Because of the rural nature of theisland and its relative isolation and separationfrom the mainland by Puget Sound, the area hasattracted people of retirement age. The town ofLangley has 20 small businesses, each employingthree to six people. The local school district em-ploys 30 to 40 employees, while the local sawmillhas 15 employees.

The northern end of the island is served by twobranches of Everett Trust and Savings Bank, Eve-rett, Wash., and a branch of Whidbey Island Bank,Coupeville, Wash., all located at Oak Harbor. Inaddition, there are two savings and loan associationoffices and three small loan companies at Oak Har-bor. The central part of the island is served by thehead office at the Whidbey Island Bank in Coupe-ville, which opened in 1961, and now holds assetstotalling about $4 million. This bank has an ap-proved but unopened branch location at Clinton,6 miles to the south of Langley. The only otherfinancial institution in the Langley State Bank'sservice area is a small branch of a local savings andloan association, located 6 miles south of Clinton,which competes for real estate loans and timedeposits.

Consummation of this transaction will be ofsubstantial benefit to the Langley-Freeland area.The lending limit of the resulting bank's offices inthis area will be much greater than that of theselling bank. The resulting institution will offerexpanded banking services including trust services,international banking services, investment counsel-ing services, and electronic data processing services.As many of the local residents are near retirementage, the availability of trust services will meet theirneeds. Consummation of this transaction will pro-vide management succession for the selling bank,

and it is anticipated that the more aggressive lend-ing policies of the resulting bank will redound tothe benefit of the community.

Competition will not be adversely affected byconsummation of this proposal. Since the parti-cipating banks operate in distinct areas, no compe-tition will be eliminated. The introduction of thecharter bank's resources to the service area of theselling bank should stimulate banking competitionin this area, while consummation of this transactionshould have no competitive effect in other parts ofthe State. The charter, or purchasing, bank's rankamong Seattle and Washington State banks willremain unchanged, since the addition of the sellingbank's assets will increase its size only minimally.

Applying the statutory criteria we find the saleto be in the public interest, and the application,therefore, is approved.

JUNE 4, 1970.


Although the head offices of the merging banksare 37 miles apart, Peoples National has brancheson the mainland at Mountlake Terrace and Eve-rett, which are 18 miles and 15 miles distant, re-spectively, from Langley. However, Peoples Na-tional does not operate a branch on WhidbeyIsland. It would appear, therefore, that little directcompetition between the banks would be elimi-nated by the proposed merger.

Washington law prevents banks from establish-ing a de novo branch in any additional city ortown where another bank regularly transacts busi-ness (although it does permit statewide expansionby acquisition or merger). Peoples National couldenter Langley directly only by acquisition of Lang-ley State, the community's sole bank. But PeoplesNational, the third largest bank in the State, couldopen an office in any community adjacent to Lang-ley which did not presently have a bank, and thusbecome a direct competitor of Langley State. Themerger will eliminate such potential competition.

96


UNIVERSITY NATIONAL BANK, ROCKVILLE, M D . , AND MONTGOMERY BANKING AND TRUST COMPANY, ROCKVILLE, M D .


Montgomery Banking and Trust Company, Rockville, Md., withand University National Bank, Rockville, Md. (15365), which hadmerged July 6, 1970, under charter and title of the latter bank (15365). Themerged bank at date of merger had

Total assets

$1139

48

,181,207

,536

,628,224

,914

Banking offices

Inoperation

37

To beoperated

10


On April 2, 1970, Montgomery Banking andTrust Company, Rockville, Md., and UniversityNational Bank, Rockville, Md., applied to theOffice of the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of the latter.

University National Bank, the charter bank,opened for business August 1, 1964, and now holdsIPC deposits of $26.6 million. The charter bankpresently operates its head office at Rockville, anoffice in College Park, and one in Riverdale. It hasfour offices in Montgomery County; one in Gaith-ersburg, one in Rockville, one in Silver Spring, andone in Bethesda. In addition, applicant has threeapproved but unopened branch locations in SilverSpring, and one application pending for ChevyChase, all in Montgomery County.

The Montgomery Banking and Trust Company,the merging bank, with IPC deposits of $8.6 mil-lion, opened for business February 1965. In addi-tion to its head office in Rockville, it presentlyoperates one branch in Quince Orchard, approxi-mately 5 miles northwest of Rockville, and has anapproved but unopened location in Olney, approxi-mately 5 miles northeast of Rockville. While thebank is in good condition, it must provide formanagement succession.

The service area of both banks is the suburbanMaryland section of the Washington, D.C., Metro-politan Area, which encompasses Montgomery andPrince Georges counties. The population, growthrate, per capita income, and family income in thisarea is reported to be among the highest in the Na-tion. The economy is stable, and depends primarilyupon the Federal Government. The populationgrowth rate is related to the growth of the FederalGovernment. Significant government installationsin the area include the Atomic Energy Commissionand Bureau of Standards complexes, in Montgom-ery County; and the NASA facility and Andrews

Air Force Base, in Prince Georges County. Apartfrom service industries and the Federal Govern-ment, the largest single industry in both countiesis the construction industry. However, light indus-trial and research and development activities haveincreased substantially over the last decade. In themore rural areas, farming retains some economicimportance.

Banking competition in this area is intense, with29 different banks operating through 176 offices.Area deposits held by those 29 institutions are re-ported to be $1.25 billion. While many of thosebanks are relatively small, the Maryland NationalBank, Baltimore, Md., with total resources of over$1 billion, operates 12 offices, and has five approvedbut unopened branch locations in this area. Theother two Baltimore-based banks operating in thearea are the First National Bank of Maryland, withtotal resources of over $700 million, and sevenexisting and two approved but unopened offices inthe area; and The Equitable Trust Company, withresources of almost $600 million, and five offices inthe area. The two largest area-based banks are theSuburban Trust Company, Hyattsville, Md., withdeposits of $459 million and 38 offices; and the $200million Citizens Bank and Trust Company, River-dale, Md., with 31 offices. University National Bankranks 12th in size among the 29 institutions. The11 Washington, D.C.-based banks, some of whichhave established offices close to the Maryland-D.C.line, are also an important competitive factor.

This merger will create an institution more capa-ble of meeting the area's banking needs withgreater depth in management than is currentlyavailable to either institution individually. The re-sulting bank will be better able to handle the bank-ing needs of the larger business organizations thaneither participating bank currently is. Consolida-tion of internal operations is expected to reduceoverhead and operating expenditures.

Banking competition will not be significantly

97


affected by this merger. Neither participating bankis a major competitive force in the relevant bank-ing market; their combinations will give the result-ing bank control of less than 4 percent of the de-posits in both counties. The resulting bank will beeighth in size among banks operating in the twocounties, five of which are large statewide or re-gional organizations. While the proposed mergermay result in the elimination of one alternativebanking outlet, adequate banking alternatives willremain. Through the creation of a larger institu-tion, competition with and among the larger com-petitors in the area will be enhanced.

Applying the statutory criteria, we find themerger to be in the public interest, and the applica-tion, therefore, is approved.

JUNE 3, 1970.


The head office of Montgomery in Rockville is11.5 miles from the head office of University inCollege Park, but only 2 miles from its Rockvilleoffice which is soon to become its new head office.

The application states that, despite this proximity,these two Rockville offices are not competitors be-cause they are on opposite sides of a wide, heavilytraveled highway, with difficult cross access.

Although there are a number of other bankingalternatives in suburban Montgomery County, themerging banks are clearly alternatives for a numberof its residents. Accordingly, we conclude that somedirect competition will be eliminated by the pro-posed merger.

As of June 30, 1968, Montgomery held about 1.4percent of total commercial bank deposits in Mont-gomery County. On that date, University operatedno office in the county, but has since merged withthe Old Line National Bank, which on the abovedate held about 3 percent of such deposits. Mostof Maryland's largest commercial banks operateoffices in the county, including Baltimore-basedbanks which are rapidly improving their competi-tive positions.

Although the proposed merger would eliminatesome direct competition, we do not believe that itsoverall effect would be significantly adverse.

THE MERCHANTS NATIONAL BANK OF BURLINGTON, BURLINGTON, VT., AND BARRE TRUST COMPANY, BARRE, VT.


Banking offices

Inoperation

To beoperated

Barre Trust Company, Barre, Vt., withand The Merchants National Bank of Burlington, Burlington, Vt. (1197), whichhadmerged July 9, 1970, under charter and title of the latter bank (1197). Themerged bank at date of merger had

$10,734,254

33,728,785

44,021,777


On March 23, 1970, the Barre Trust Company,Barre, Vt., and The Merchants National Bank ofBurlington, Burlington, Vt., applied to the Comp-troller of the Currency for permission to mergeunder the charter and with the title of the latter.

The Merchants National Bank of Burlington,with IPC deposits of $25.8 million, was organizedin 1849. This bank operates four branch offices inaddition to its head office.

Burlington, home of the charter bank, has apopulation estimated at 49,000, while ChittendenCounty, the most important part of the charterbank's service area, has a population estimated at

100,000. The service area of the Bristol branch,located in Addison County, has a population ofabout 5,000. Contributing to the economy of theBurlington area are three hospitals, three colleges,and The University of Vermont, which has a totalstudent population of 10,000. The two largest em-ployers in the area are General Electric and I.B.M.,employing 3,000 and 4,000 persons, respectively.The normal quota of shopping centers and owner-operated service type industries are also present.The economy of Bristol is mainly based on resortactivity, with three major ski areas established inthe last several years, and with vacation home con-struction continuing.

98


The charter bank competes in the Burlingtonarea with the two largest banks in the State: theChittenden Trust Company and The HowardNational Bank and Trust Company. In addition,the Burlington Savings Bank, with deposits in ex-cess of $100 million, operates in the area. Thelargest federal savings and loan association in theState, and seven branches of finance companies alsocompete in the Burlington area.

Barre Trust Company, the merging institution,with IPC deposits of $9.6 million, was organizedin 1921. It is a unit bank beset by serious mana-gerial, capital, and growth problems. Its inadequatelending limit has seriously hampered its growthand its efforts to compete with the other larger in-stitutions in its area.

Barre, Vt., home of the merging bank, has apopulation of 16,500 and is the third largest cityin the State. The population of WashingtonCounty, the service area of the merging bank, isestimated at 50,000. The granite industry is a majorcontributor to the economy. Rock of Ages Granite,the most well known of the local granite com-panies, employs 5,700 persons. Five other quarriesand numerous finishing plants are also located inthe area. Sprague Electric, an electronics firm em-ploying 800, is located in Barre, as are two collegeswhich have a total student and faculty populationof 2,300. National Life Insurance of Vermont andthe administrative offices of Vermont's State Gov-ernment are located in Montpelier, 8 miles north-west of Barre, and many of their employees com-mute from Barre. Agriculture and retail, wholesale,and service industries also provide some supportfor the area economy.

Competing with the merging bank is The Peo-ples National Bank of Barre, with total deposits ofabout $20 million; Montpelier National Bank, withtotal deposits of $21.3 million; the Montpelierbranches of the Howard National Bank and TrustCompany, and The Chittenden Trust Company,Vermont's largest banks; and the Granite SavingsBank and Trust Company of Barre, with totaldeposits of $28.6 million. A mutual fire insurancecompany, branch offices of two small loan compa-nies, and two small credit unions also offer compe-tition in Barre.

Consummation of the merger will enable theBarre office of the resulting bank to offer betterservice at lower cost through its larger lending

limit, improved managerial resources, trust servicecapabilities, newly available computer resources,and its generally expanded marketing capability.

This merger will have no adverse competitiveeffect. Since the service areas of the two banks areseparate and do not overlap, no competition willbe eliminated. Because each bank is the smallestbank operating in its service area, the mergershould enhance competition by creating a larger in-stitution more capable of competing with its largercompetitors. Potential competition will not beaffected since it is very unlikely that either mergingbank would branch into the service area of theother owing to the adequate number of bankingoutlets presently available to service each area.

Applying the statutory criteria, it is concludedthat the proposed merger is in the public interest.The apnlication, therefore, is approved.

MAY 19, 1970.


Barre Trust is located about 45 miles southeastof Merchants National's main office and about 43miles away from its nearest branch office. Neitherbank derives a significant amount of business fromthe service area of the other bank. Moreover,Montpelier, the State capital, is located 8 milesnorthwest of Barre, along the main highway be-tween Burlington and Barre, where three commer-cial banks, including the two largest in Vermont,operate offices. In view of these circumstances, therewould seem to be little direct competition betweenthe merging banks.

Under Vermont law, Merchants National couldenter the Barre-Montpelier area de novo. It ac-counts for about 11 percent of total deposits heldby the three commercial banks in Burlington. Itschief competitors, Howard National Bank &r Trust(total deposits of $116.5 million) and ChittendenTrust Company (total deposits of $109.1 million),have entered the Barre-Montpelier area throughprevious mergers with banks in Montpelier. WhileMerchants National could be considered a likelyde novo entrant into the Barre-Montpelier area,its acquisition of Barre Trust, the smallest of threecommercial banks in Barre and the smallest of sixcommercial banks in the Barre-Montpelier area,would not have a significantly adverse effect onpotential competition.

99


TRUST COMPANY NATIONAL BANK, MORRISTOWN, N.J., AND MONTCLAIR NATIONAL BANK AND TRUST COMPANY, MONTCLAIR, N J .


Montclair National Bank and Trust Company, Montclair, NJ. (9339), with. . . .and Trust Company National Bank, Morristown, NJ. (4274), which hadconsolidated July 10, 1970, under charter of the latter bank (4274) and title"American National Bank & Trust." The consolidated bank at date of consolida-tion had

Total assets

$153,852,352187,631,441

340,612,870

Banking offices

Inoperation

1116

To beoperated

27


On February 20, 1970, Trust Company NationalBank, Morristown, N.J., and Montclair NationalBank and Trust Company, Montclair, N.J., appliedto the Comptroller of the Currency for permissionto consolidate under the charter of the former andwith the title "American National Bank andTrust."

Trust Company National Bank, the charter bank,has total assets of $196 million. It operates twoofl&ces in Morristown and 15 offices in 11 otherMorris County municipalities. In addition to thoseofl&ces, Trust Company National Bank operatesone branch in adjacent Sussex County and has re-ceived approval to open two more offices in SussexCounty and one in Warren County.

Morristown, the headquarters of the charter bankand the location of one of its branches, is an inter-esting residential community with a population ofapproximately 22,000. It is the seat of MorrisCounty and is located about 35 miles west of NewYork City and 17 miles west of Montclair, the head-quarters of the consolidating bank.

Morristown and its environs in Morris Countycomprise the market area of the charter bank. Thepopulation of the county is approximately 405,000.The economy of Morris County is in a dynamicphase. Until 1950, the area was predominantly agri-cultural. Now the area is heavily developed resi-dentially, and is experiencing the beginnings ofsome industrialization.

The Montclair National Bank, the consolidatingbank, has total resources of approximately $158million, and operates 10 offices in Essex County.In addition to the headquarters in Montclair, thebank has four branches in Montclair, threebranches in Millburn, and one branch each inVerona and West Caldwell.

The market area of the consolidating bank is

Essex County, particularly that part of the countyknown as "West Essex County." The area is pri-marily residential. With the exception of the Cald-wells and parts of Cedar Grove, penetration by in-dustry has been minimal.

Montclair, the headquarters of the consolidatingbank and the hub of its system of branches, islocated 14 miles west of New York City. It has anestimated population of 44,700. At one time, Mont-clair was considered one of the most affluent sec-tions of the State and Nation. Presently, while itdoes not enjoy a reputation as the redoubtablebastion of the privileged class, as it did in the1930's, it remains an affluent commuter communityfor executives and professionals working in NewYork and Newark.

Both the merging and the consolidating banksface aggressive competition in their respectivemarket areas. In terms of deposits, the Trust Com-pany National Bank ranks 11th, and Montclair17 th, of the 88 commercial banks in the FirstBanking District. The resulting bank will rankninth. Both banks are considerably smaller thantheir larger competitors. Additional competitionis provided by six savings banks with 31 offices inEssex and Morris counties and 55 savings and loanassociations with offices in the two counties. Com-petition for savings deposits and mortgage businessis extremely strong with those institutions.

The consolidating bank has experienced particu-larly strong competition from the State's threelargest commercial banks, and from the largest sav-ings bank, all of which have head offices in Newark.At present, the four municipalities in which Mont-clair has offices are also served by at least one of thelargest banks, each of which is over four timesMontclair's size. Last year's amendments to NewJersey's branch banking law have intensified thiscompetition through new branch approvals, merg-

100


ers, and holding company formations. The in-creased competition has contributed to the $4 mil-lion shrinkage in Montclair's deposits in the lastcalendar year.

Competition between Trust Company NationalBank and the Montclair National Bank is insigni-ficant as, historically, each of the two banks haveserved only their respective counties. Under the re-vised branch banking and merger laws that wererecently enacted, the opportunities for de novobranching by the Trust Company National Bankand the Montclair National Bank in either EssexCounty or Morris County are slim. There is at leastone banking office in each of the 39 municipalitiesin Morris County, and the Trust Company Na-tional Bank has offices in 11. Nine of these munici-palities have head office protection, 20 have popula-tions of under 7,500, thereby providing branchoffice protection, and the remaining 10 are pres-ently the sites of 30 banking offices. In the 22towns in Essex County, there is at least one bankingoffice in each town, and Montclair National Bankhas offices in 4. Eleven of the towns have head officeprotection and four towns have populations ofunder 7,500, including one town which does notpermit any property to be zoned for business. Inthe seven remaining towns, there are presently 25banking offices. Neither the Trust Company Na-tional Bank nor Montclair National Bank has ex-pressed any interest in applying for branches inany of those communities in Essex County as theyalready appear to be heavily banked by offices ofsome of the largest banks in the State. The costof starting a new office and competing effectivelyunder these circumstances would be prohibitive.

Consolidation of the subject banks will inure tothe benefit of the residents of Essex County. EssexCounty, which is presently served by MontclairNational Bank, will have the facilities and servicesof a larger, more aggressive institution. Servicespresently offered by one or the other of the con-solidating banks, together with certain services notnow offered, will become available to all of the

customers and prospective customers of the result-ing bank.

The consolidation, with resulting increased lend-ing limit, will enable the resulting bank to competemore effectively with the larger banks in northernNew Jersey and with the New York City banksthat actively solicit new business throughout theservice areas of the consolidating banks. As popula-tion and industrial growth in the First BankingDistrict continues, it will be necessary for the sub-ject banks to accommodate to this development.The resulting bank, through a larger lending limit,will be able to retain the subject banks' business,and compete effectively for new business as it de-velops.

Applying the statutory criteria to the proposedconsolidation we conclude that it is in the publicinterest and the application is, therefore, approved.

JUNE 8, 1970.


Montclair Bank could be considered a likelypotential entrant into Morris County. By enteringthe county through consolidation with Trust Com-pany, it will add its resources to the county leader,controlling about 33 percent of county commercialbank deposits. However, while Montclair Bank isa substantial bank, apparently able to effect entryinto Morris County de novo or through mergerwith a smaller bank in the county, it is not amongthe larger potential entrants. Each of the threelarge Newark banks, as well as those describedabove headquartered in Passaic, Bergen, and Hud-son counties, could enter Morris County. Severalhave received permission to open de novo branchoffices therein.

Each of the consolidating banks is not amongthe very largest potential entrants into the primaryservice area of the other. However, Trust Com-pany's dominant position in Morris County andthe close proximity of the service areas of the banksindicate that the proposed consolidation may havesome adverse effect on potential competition.

101


FIRST COUNTY NATIONAL BANK AND TRUST COMPANY, WOODBURY, WOODBURY, N.J., ANDTHE FIRST NATIONAL BANK AND TRUST COMPANY OF PAULSBORO, PAULSBORO, N J., AND

PITMAN NATIONAL BANK AND TRUST COMPANY, PITMAN, NJ .


Banking offices

Inoperation

To beoperated

Pitman National Bank and Trust Company, Pitman, NJ . (8500), withThe First National Bank and Trust Company of Paulsboro, Paulsboro, NJ .(5981), withand First County National Bank and Trust Company, Woodbury, Woodbury,NJ . (1199), which hadmerged July 17, 1970, under charter of the latter bank (1199) and title "NationalBank and Trust Company of Gloucester County." The merged bank at date ofmerger had

$15,748,018

24,218,387

40,681,659

80,777,366 11


On December 29, 1969, Pitman National Bankand Trust Company, Pitman, N.J., and The FirstNational Bank and Trust Company of Paulsboro,Paulsboro, NJ. applied to the Office of the Comp-troller of the Currency to merge into First CountyNational Bank and Trust Company, Woodbury,Woodbury, N.J., under the charter of the latter andwith the title "National Bank and Trust Companyof Gloucester County."

Gloucester County, home of the subject banks,has a population of 167,200, reflecting a 25 percentincrease during the past 9 years. It is situated alongthe eastern shore of the Delaware River, immedi-ately south of Camden County, and convenient tothe cities of Philadelphia and Camden. This area,which is included in the Third Banking District ofNew Jersey, has experienced tremendous growth inthe past decade, and there is every indication thatsimilar growth will occur in the present decade.

Although 40 percent of the county's land area isdevoted to agriculture, manufacturing and petro-leum refining are both important contributors tothe economy. There is light and heavy manufactur-ing as well as food processing and packaging in thishighly productive agricultural area. Numerous re-tail shopping centers dot the area. Most of thepopulation and nonagricultural economic activityis concentrated in the western sector of the county.

Woodbury, with an estimated population of13,700, is the seat of Gloucester County. It issituated in the northern part of the county, 7 milessouthwest of Camden. Because of its proximity toCamden and Philadelphia, Woodbury is a "bed-room" community for many people employed inthose two cities.

The First County National Bank and Trust Com-pany, Woodbury, which has IPC deposits of $29million, was organized as the Gloucester CountyBank in 1855. Its present corporate title wasadopted in 1960. The bank operates two in-townoffices and three out-of-town branches, all within4 miles of Woodbury. The out-of-town offices arelocated in the communities of National Park,Woodbury Heights, and Deptford.

Paulsboro, with an estimated population of 8,900,is located on the Delaware River about 12 milessouthwest of Camden, and 5 miles west of Wood-bury.

The First National Bank and Trust Company ofPaulsboro, with IPC deposits of $17.3 million, wasorganized in 1901. Besides two offices in Paulsboro,this bank operates three out-of-town brancheswithin 3 miles of Paulsboro, in the communitiesof Gibbstown, West Deptford, and Mulleton.

Pitman, which has an estimated population of9,700, is primarily a residential community. It issituated 8 miles south of Woodbury and 9 milessoutheast of Paulsboro. The Pitman National Bankand Trust Company, with IPC deposits of $14 mil-lion, was organized in 1907, and operates as a unitbank.

The Woodbury bank branch closest to any officeof the Paulsboro bank is its Woodbury Heightsbranch, which is about 3 miles east of the latterbank's West Deptford Township branch. Thosebranches are also the closest to an office of thePitman bank, as they are 7 miles north and 8 milesnorthwest respectively. There is no substantialcompetition between these offices. Moreover, thereare several offices of other banks located betweenWoodbury and Pitman.

102


The potential for increased competition amongthe three banks in the foreseeable future appearsremote since New Jersey statutes prohibit de novobranching in communities where the head officeof a bank is already situated, and in towns witha population of 7,500 or less where a branch alreadyexists. Consummation of the merger will increasecompetition as it will eliminate head office protec-tion for Paulsboro and open it up for de novobranches.

The First County National Bank and TrustCompany, Woodbury, competes with the Wood-bury offices of Peoples National Bank of New Jer-sey, which has deposits of $81 million, and theDeptford Township branch of Colonial NationalBank, Haddonfield, which has deposits of $113million. The First National Bank and Trust Com-pany of Paulsboro's West Deptford Townshipbranch competes with a branch of South JerseyNational Bank, Camden, which has deposits of$227 million. The Pitman National Bank andTrust Company is in direct competition withBroadway National Bank and Trust Company ofPitman, which plans to merge with Peoples Na-tional Bank of New Jersey, Westmont.

Upon consummation of the merger there will be13 banks with deposits ranging from $4 million to$254 million serving the northern half of Glouces-ter County and a small segment of Camden County.The four banks in Camden County with which the$60 million resulting bank will be better able tocompete have deposits of $81 million, $113 million,$227 million, and $254 million.

Although the Woodbury bank is presently thelargest of 13 banks with head offices in GloucesterCounty, it is only the 15th largest of 75 commercialbanks in the Third Banking District of New Jersey.The Paulsboro bank is the third largest in Glouces-ter County and 29th largest in the Third BankingDistrict. The Pitman Bank is sixth and 43rd largest,respectively. The resulting bank will hold 3 percentof the deposits, and rank ninth in the Third Bank-ing Region.

Philadelphia banks, through advertisements andbecause many residents are employed in the city,offer banking alternatives to customers in the areaof the subject banks. In addition, a number ofsavings and loan associations, insurance companies,credit unions, and sales finance and personal loancompanies are active in the relevant market area.

The resulting bank will provide imposed servicesfor its customers including a larger lending limit,

automated deposit bookkeeping, and improvedtrust department facilities. The merger will alsoalleviate management succession problems by pro-viding an earnings potential which will enable itto attract and train young and competent manage-ment. This merger, in keeping with current eco-nomic thinking, will develop a locally-orientedbank in Gloucester County capable of servingcounty residents, and with sufficient clout to com-pete effectively with out-of-county competitors.

Applying the statutory criteria to this applica-tion, it is found to be in the public interest. Theapplication, therefore, is approved.

MAY 22, 1970.


Pitman Bank's service area is centered about thetown of Pitman, and its sole office is about 7 milesfrom the nearest offices of the other two mergingbanks. A number of offices, present and proposed,of competing banks lie in the intervening area. Itwould appear that only a limited amount of directcompetition exists between Pitman Bank and theother two merging banks; this competition will, ofcourse, be eliminated if the proposed merger isapproved.

A more substantial amount of direct competitionexists between Woodbury Bank and PaulsboroBank. While the areas in which the offices of thesetwo banks are located may be more accuratelydescribed as adjacent rather than coextensive, it isclear that a good deal of overlap in service areaexists, particularly in West Deptford Township,between Woodbury and Paulsboro. WoodburyBank's Woodbury Heights branch is located only2.1 miles from the West Deptford branch of Pauls-boro Bank.

The elimination of competition between Wood-bury Bank and Paulsboro Bank is aggravated by thelack of competitive alternatives in the vicinity ofPaulsboro. Paulsboro Bank is the only bank locatedin Paulsboro and the immediately surroundingareas. The closest alternatives are in the Woodbury-Woodbury Heights area, and include WoodburyBank. Other alternatives in this immediate areainclude the $125 million Colonial National Bank(through its merger with The First National Bank

of Westville), the $125 million Peoples NationalBank of New Jersey (through its merger withFarmers and Mechanics National Bank), and abranch of The National Bank of Mantua.

According to the application, additional com-

103


petition will be afforded by new branches of the$300 million Bank of New Jersey and the $270million South Jersey National Bank, as well as bytwo newly chartered banks.

The proposed merger will eliminate home officeprotection in Paulsboro.

As of June 30, 1968, Woodbury Bank, PaulsboroBank, and Pitman Bank held the first, third andfifth largest shares of total deposits held by bankswith offices in Gloucester County (16.2 percent,11.5 percent and 8.6 percent, respectively). Theircombined market share would have been over 36percent. Gloucester County may understate therelevant market, however, as large banks head-quartered in adjacent sections of Camden County,including the city of Camden, draw some amountof deposits and loans from the areas served bythe merging banks. Banks located in Philadelphia

may also compete to some extent, particularly forthe business of commuters.

In a greater Camden market, encompassing thenorthern sections of Camden and Gloucester coun-ties (which, in view of the proximity of WoodburyBank and Paulsboro Bank, may overstate the rele-vant market) the shares of Woodbury Bank andPaulsboro Bank total approximately 6 percent.

Although larger banks based in Camden Countyare increasing their competitive presence in theareas served by the merging banks, WoodburyBank and Paulsboro Bank in particular hold largeshares of deposits therein and, absent this proposedmerger, would probably continue as capable inde-pendent retail banking alternatives. We concludethat the overall competitive effect of their mergerwith one another and with Pitman Bank wouldbe adverse.

THE FARMERS NATIONAL BANK OF SALEM, SALEM, OHIO, AND CITIZENS SAVINGS BANK, GOLUMBIANA, OHIO


The Citizens Savings Bank, Columbiana, Ohio, withand The Farmers National Bank of Salem, Salem, Ohio (973), which hadmerged July 17, 1970, under charter and title of the latter bank (973). Themerged bank at date of merger had

Total assets

$11,094,20137,561,201

48,655,402

Banking offices

Inoperation

25

To beoperated

7


On March 24, 1970, The Farmers National Bankof Salem, Salem, Ohio, with deposits of $35.3 mil-lion, and the Citizens Savings Bank, Columbiana,Ohio, with deposits of $10.7 million, applied tothe Office of the Comptroller of the Currency tomerge under the charter and with the title of theformer.

The Farmers National Bank of Salem, head-quartered in Salem, Ohio, has IPC deposits of $33million. The bank was organized as a State institu-tion in 1846, and obtained a National charter in1865. The bank presently operates two branches inSalem and one branch in each of the nearby townsof Lisbon and Hanoverton. While the primaryservice area of the charter bank is ColumbianaCounty, the total market area also includes portionsof Mahoning, Stark, and Carroll counties.

Salem, with a population of approximately

14,300, is the largest urban area in ColumbianaCounty. The county is situated in northeasternOhio, and Salem is located in the northern partof the county 20 miles east of Canton, Ohio, 21miles southwest of Youngstown, Ohio, and 62 milesnorthwest of Pittsburgh, Pa. A strong manufactur-ing base has developed around Salem with suchindustrial concerns as Crane Company (DemmingDivision), L. W. Bliss Company, Electric FurnaceCompany, Mullins Manufacturing Corp., WarrenMolded Plastics, Inc., Quaker Manufacturing Corp.,Quaker Tool and Die, Inc., United Tool and Die,Inc., Wallace-Murray Corp., (Eljer Division),Salem Tool Co., and Sekely Industrial Tool andManufacturing Inc., as important employers. Theagricultural areas of the county are found in thenorthern and western parts, with dairy farming,livestock, and fruit production making substantialcontributions to the economy.

104


The Citizens Savings Bank was organized in 1923,and is headquartered in Columbiana, Ohio, 10miles east of Salem. The bank operates a branchat Leetonia. Its total IPC deposits for both officesis near $10.1 million.

Columbiana is a small, agricultural town of4,600 in the northern portion of ColumbianaCounty. Economic activity centers on fruit produc-tion and dairy farming. There are a number ofestablished industries which employ about 1,500people and lend economic stability to the com-munity. The prospects for growth in this area ap-pear favorable.

The proposed merger will not adversely affect thebanking structure in the resulting bank's servicearea. Eighteen banks, excluding the participants,serve the market area in question. Eleven of the20 banks now serving Columbiana County areheadquartered in the county, and nine banks head-quartered in other counties also service the marketarea through 16 branch offices. Deposits of all thecommercial banks, including the participatingbanks, total over $644 million. The charter bankholds $35.3 million of this total, and upon con-summation of the merger, the resulting bank'sdeposits will measure only $46.1 million. In ad-dition to the 18 other commercial banks operatingin the broad market area, the resulting bank willcompete with 11 savings and loan associations, 2insurance companies, 20 credit unions, 4 salesfinance companies, and 14 personal loan organiza-tions. Consequently, the resulting institution willnot dominate the area's financial structure.

Approval of the proposed merger will not elimi-nate a significant degree of competition betweenthe participating banks. While the participatingbanks' main offices are approximately 10 milesapart, the head offices of three other banks arelocated in Salem, Columbiana, and Lisbon, andthey all compete directly with the applicant banks.Several other banks, including The Union NationalBank of Youngstown, with total assets of $142 mil-lion; the First National Bank of Canton, with abranch at Minerva, and total assets of $160 mil-lion; and The Mahoning National Bank of Youngs-town, with total assets of about $140 million, allhave branch offices within 15 miles of the ap-plicants.

The benefits accruing to the public will out-weigh any anticompetitive aspects resulting fromthis merger. The market area's future banking

needs will be better served by one large bank withmultiple services than by two smaller banks withfewer services. The resulting institution will besufficiently large to install or lease computer facili-ties for its own use and the use of its customers.The larger lending limit will enable the resultingbank to fulfill the credit needs of the local manu-facturing concerns, and to better meet the competi-tion of the larger banks in the area. Specializedbanking services, such as agricultural loans, studentloans, bank credit card services, and increased in-stalment lending services will become available tothe customers in the immediate trade area of TheCitizens Savings Bank. In addition, approval of thismerger will assure management continuity, whichis presently unavailable to the merging bank.

Applying the statutory criteria to the proposedmerger, we find that it is in the public interest,and the application, therefore, is approved.

JUNE 11, 1970.


The Leetonia branch of Citizens Savings islocated only 7 miles from Farmers National's EastSide branch, in Salem. Although there are threeother banking offices in the intervening area, merg-ing banks are in direct competition. For example,Farmers National derives industrial accounts andloans from Leetonia and Columbiana. The pro-posed merger, of course, would eliminate this directcompetition and would eliminate the potential forgreater competition which would occur if thebanks were to open new branches closer to eachother.

Eleven banks with 23 offices were located inColumbiana County, as of December 31, 1969. Withabout 20 percent, Farmers National held thelargest share of county total deposits of $174.6 mil-lion, and the second largest share—about 20 per-cent—of county total demand deposits of $64 mil-lion. Citizens Savings held the sixth largest share, orabout 6 percent, of total deposits, and the seventhlargest share, or about 5 percent, of total demanddeposits. As a result of the proposed merger, thatshare of total deposits held by the county's fourlargest banks would increase about 6 percent, toapproximately 71 percent, and figures for totaldemand deposits show a comparable increase ofabout 5 percent, to nearly 70 percent.

The proposed merger is likely to result in theelimination of direct competition between the

105


merging institutions, increase concentration in com-mercial banking and eliminate Citizens Savings asan independent competitor in an area where con-

tinued economic growth is expected. We concludethat the proposed merger would clearly have anadverse effect upon competition.

FIRST NATIONAL BANK OF EASTERN NORTH CAROLINA, JACKSONVILLE, N.C., AND THE STATE BANK OF WINGATE, WINGATE, N.C.


The State Bank of Wingate, Wingate, N.C, withand First National Bank of Eastern North Carolina, Jacksonville, N.C. (14676),which had . .merged July 27, 1970, under charter and title of the latter bank (14676). Themerged bank at date of merger had. .

Total assets

$3,046,720

105,073,518

108,120,239

Banking offices

Inoperation

2

32

To beoperated

34


On February 9, 1970, The State Bank of Win-gate, Wingate, N.C, and First National Bank ofEastern North Carolina, Jacksonville, N.C, appliedto the Comptroller of the Currency for permissionto merge under the charter and with the title ofthe latter.

The First National Bank of Eastern North Caro-lina, with I.P.C deposits of $69.7 million, was es-tablished in 1952, and presently operates throughits main office, 27 branch offices, and one facility.The bank operates in 15 counties, 13 in the easternportion of the State, surrounding its home countyof Onslow, and in the two western counties ofWatunga and Henderson. Until 1959, the bankconfined its activities to the city of Jacksonville,and operated as a unit bank. Since that time, thebank has been involved in four acquisitions, thelargest of these being the merger of the Bank ofLillington, in 1967, with slightly more than $3million in deposits. Primary expansion, however,has been through de novo branching. In its homecity of Jacksonville, the charter bank competesvigorously with six branches of the $590 milliondeposit Citizens Bank and Trust Company.Through its other branches, the bank also com-petes with a branch of the $402 million North-western Bank, in Boone; with branches of the $1.1billion North Carolina National Bank and the $1.1billion Wachovia Bank and Trust Company N.A.,in Wilmington; and with a branch of the $827million deposit First Union National Bank, inHendersonville.

The economy of the merging bank's home office

territory, Jacksonville, is largely dependent uponagriculture, tobacco is the leading money crop, andupon large military installations located nearby.Camp Lejeune, for example, covers 111,000 acresin the county, and carries an annual payroll inexcess of $200 million. Some industry has movedinto the area in recent years and aggressive effortsare being made to attract new industry, particularlyin light of the decline in tobacco production inrecent years.

The State Bank of Wingate, which was organizedin October 1909, presently holds IPC deposits ofapproximately $2 million, and operates throughits main office and one branch, both of which arelocated in the rural community of Wingate. Thebank has experienced only nominal growththroughout its long history, as is evidenced by itspresent size. Because of this, it has not been in aposition to adequately respond to the financialneeds within its service area. It has lost its mostcapable young officer, leaving only the presidentto manage the bank's affairs, and now the mergingbank faces a serious management succession prob-lem. Primary competition for the bank derivesfrom the $50 million deposit American Bank andTrust Company, headquartered in Monroe, N.C,3 miles from Wingate, and the $42 million depositSecurity Bank and Trust Company in UnionCounty, with two branches in Monroe. In addition,the $1.1 billion deposit North Carolina NationalBank has an approved but unopened branch inMonroe. Competition, particularly for the largerlines of credit in the merging bank's service area,also derives from large banks either headquarteredor located in Charlotte.


Wingate, which is in Union County, had a 1960population of approximately 1,300. The town islocated 35 miles southeast of Charlotte, the largestcity in the Carolinas, and 3 miles east of Monroe,which has a population of 12,000. Economic activityin the immediate area of Wingate is primarily de-pendent upon an industrial park situated approxi-mately halfway between Wingate and Monroe,which employs over 5,000 persons. Wingate Col-lege, with a present enrollment of 1,600 students,is also an important contributor to the local econ-omy. Union County, which is considered to bewithin the bank's primary service area, has showna steady growth in population to an estimated51,000, today. The proportion of the county'slabor force employed in agriculture has droppedfrom 71.5 percent in 1930, to 11.7 percent, in 1960.In recent years, because of its easy accessibility toCharlotte, the county has become a "bedroom"community for that city. Indeed, one-third of thelabor force worked outside of the city in 1960,and it is estimated that the figure is even highertoday. In 1967, there were 412 employers in UnionCounty, employing some 10,000 people, and totalcounty employment increased over 30 percent from1962 to 1967. Future growth trends for this areaare expected to be good.

Consummation of this merger will eliminate noexisting competition between the two banks. Thereis presently no competition between the two banksin each other's service area for either customers orbusiness. The closest offices of the two banks are140 miles apart. Entrance of charter bank into themerging bank's service area will provide a moreaggressive competitor to banks already located in,

or entering, the county, and will replace a relativelyineffectual bank. The Wingate Bank, because of itslocation within Union County, its proximity to alarge industrial park, and the accessibility to Char-lotte, can become, as a result of this merger, a muchmore effective competitor throughout the county.In addition, entrance of charter bank into thismarket area will provide the customers of TheState Bank of Wingate with additional bankingservices such as an increased lending limit, trustservices, overdraft banking, specialized loan services,FHA and VA loans, and credit card services. In ad-dition, the capable and qualified management teamof charter bank will be available to the customersof merging bank.

It is concluded that this merger will have no ad-verse competitive effect and is in the public interest.The application, therefore, is approved.

JUNE 26, 1970.


First National operates throughout eastern NorthCarolina and in two counties in the western partof the State. Wingate Bank's two offices are insouth central North Carolina, more than 100 milesfrom the nearest existing office of First National.Thus, the merger would not eliminate any signifi-cant direct competition.

First National has applied for approval to opena de novo office in Monroe, about 3 miles fromWingate Bank. Thus, the merger would eliminatepotential competition between the two banks. Inview of Wingate Bank's small size and the numberof banking alternatives in the area, however, thisloss of potential competition is not significant.

FIRST & MERCHANTS NATIONAL BANK, RICHMOND, VA. , AND SUBURBAN NATIONAL BANK OF VIRGINIA, (MCLEAN P.O.),FAIRFAX COUNTY, V A .


Suburban National Bank of Virginia, Fairfax County (P.O. McLean),(14965) withand First & Merchants National Bank, Richmond, Va. (1111), which hadmerged July 31, 1970, under charter and title of the latter bank (1111).merged bank at date of merger had

Va.

The

Total assets

$49,353769,096

816,282

,508,943

,176

Banking offices

Inoperation

954

To beoperated

63

107



On March 31, 1970, the Suburban National Bankof Virginia, (McLean P.O.), Fairfax County, Va.,and the First & Merchants National Bank, Rich-mond, Va., applied to the Office of the Comptrollerof the Currency for permission to merge under thecharter and with the title of the latter.

The charter bank, with IPC deposits of $519 mil-lion, was originally organized in 1865, and presentlyoperates 56 branch offices. Its principal area ofoperation is the Richmond Metropolitan Areawhere it has 22 offices. It also operates offices inthe communities of Newport News, Staunton,Lynchburg, Waynesboro, Norfolk, Portsmouth,Virginia Beach, and Chesapeake. It has a facilityin the Pentagon where the merging bank operatesa branch office, and an office at Dulles InternationalAirport. The bank ranks second in size among allcommercial banks in Virginia, and third among allthe financial institutions. In its area, the bankfaces competition from virtually every major bankand bank holding company in the State and de-rives some competition from the larger banks innearby Maryland and the District of Columbia.The bank is wholly-owned by the First and Mer-chants Corporation, a one-bank holding company.

The merging bank, headquartered in FairfaxCounty, with McLean as its post office address,has IPC deposits of $37 million, and presentlyoperates two branch offices in Fairfax County andthree in Arlington County. It has received approvalfor three additional branches. The bank has notkept pace with the rapid growth of its area, and hasa poor earnings record. The bank is not a strongcompetitor in its area, and lacks the managementdepth necessary for future growth.

The service area of the merging bank encom-passes the counties of Arlington and Fairfax andthe independent cities of Alexandria, Falls Church,and Fairfax. This northern Virginia area, with anestimated population of 800,000, is part of theWashington, D.C., Standard Metropolitan Statisti-cal Area, the fastest growing metropolitan area inthe country. The area is characterized by high edu-cational and income levels and a mobile cosmopoli-tan population. It is a burgeoning center of re-search and development and other technicallyoriented light industries. Largely responsible forthe population gravitation to this area and its de-velopment has been the rapid economic growth andthe increasing influence of Washington, D.C., sinceWorld War II.

Arlington County, which was just a "bedroom"community for Washington, presently enjoys anestimated population of 200,000, and has experi-enced a significant economic development. FairfaxCounty's population has grown from 262,000, in1960, to a present population of 455,000, and thecounty has become a focal point for development.Practically all of the Arlington-based banks havechanged their headquarters to Fairfax County sothat, under the Virginia branching laws, they couldtake full advantage of this new growth area. Thecities of Alexandria and Falls Church are fully de-veloped land extensions of Arlington and Fairfaxcounties. As indicated, the merging bank has notbeen able to keep pace with the rapid economicgrowth of its area and, as a result, is not able toadequately serve the area's rapidly expandingneeds.

Banking competition in the area of the mergingbanks is provided by 23 banks, operating 171 offices,with aggregate deposits of approximately $1 billion.Six of the eight statewide banking organizationsnow compete vigorously in the area. The largestbank in the State, Virginia National Bank, withdeposits of $700 million, presently operates 11 of-fices in the area. Banking competition is also pro-vided by the large banks in nearby Washington,D.C., and Maryland.

The only competition existing between the par-ticipating banks is between their offices in thePentagon. If this merger is approved, the office ofthe charter bank will be consolidated with thebranch of the merging bank. The next closest officeof the charter bank to the merging bank is at DullesInternational Airport, about 10 miles to the westof Suburban National Bank's westernmost office.That office is relatively isolated and exerts no com-petitive influence on the northern Virginia area.This merger will not eliminate potential competi-tion between the participating banks because,under the branching laws of Virginia, the banksare not permitted to branch into the areas of theother.

Consummation of the proposed merger will haveno significant effect on concentration of bankingresources in Virginia. First and Merchants NationalBank's share of 9.5 percent of the total commercialbank deposits in the State will be increased byonly 0.6 percent, Suburban National Bank's shareof total State deposits. The effect of this mergerwill be in the northern Virginia area served bythe merging bank, where it will introduce a more

108


competitive institution better able to meet the in-creasing needs of this rapidly growing area. Thismerger will also solve the management problemat the merging bank.

Considered in the light of the statutory criteria,this merger is deemed to be in the public interest.The application is, therefore, approved.

JUNE 23, 1970.


The closest branches of First & Merchants arelocated in the Leesburg and Dulles Airport areasof Loudoun County, approximately 15 miles fromSuburban National's Vienna branches. However,First & Merchants does operate a restricted-servicebanking facility in the Pentagon, in direct com-petition with Surbuban National's Pentagonbranch, as deposit and loan account overlaps indi-cate. The proposed merger, of course, would elimi-nate this competition.

Five of the six largest banking organizations inVirginia have branches or affiliates in all the princi-pal jurisdictions in Northern Virginia: Fairfax andArlington counties, and the city of Alexandria.First & Merchants, the State's third largest bank-

ing organization, has no branch in any of thesejurisdictions, with the exceptions of their Pentagonfacility. Hence First & Merchants is a potentialentrant into this area.

However, under Virginia law, First & Merchants,as presently organized as one-bank holding com-pany, is precluded from establishing de novobranches in any of these Northern Virginia jurisdic-tions, and can enter only via merger.

Suburban National is the sixth largest of 23 com-mercial banks in Northern Virginia, and has sixof the area's 178 approved banking offices. Threebanking organizations, including the largest andsixth largest in the State, operate banking officesin all Northern Virginia jurisdictions, and holdabout 63 percent of area total deposits of $1.4 bil-lion. Those organizations control about one-thirdof the total number of area banking offices. Subur-ban National has about 4 percent of area total de-posits. However, in view of the fact that Suburban'soffices are located only in north-central Fairfax andArlington counties, this percentage may understateits relative market position. Suburban had 3.8 per-cent of total Arlington County deposits as of June29, 1968, and 7.8 percent of total Fairfax Countydeposits as of that date.

LINCOLN NATIONAL BANK AND TRUST COMPANY OF CENTRAL N E W YORK, SYRACUSE, N.Y., ANDTHE NATIONAL EXCHANGE BANK OF BOONVILLE, BOONVILLE, N.Y.


Banking offices

Inoperation

To beoperated

The National Exchange Bank of Boonville, Boonville, N.Y. (8022), withand Lincoln National Bank and Trust Company of Central New York, Syracuse,N.Y. (15627), which hadmerged July 31, 1970, under charter and title of the latter bank (15627). Themerged bank at date of merger had

$6,069,082

243,069,535

249,138,617

1

18

19


On April 15, 1970, The National Exchange Bankof Boonville, Boonville, N.Y., and the Lincoln Na-tional Bank and Trust Company of Central NewYork, Syracuse, N.W., applied to the Office of theComptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

The charter bank, with IPC deposits of $175 mil-lion, was originally organized in 1929, and presently

operates 16 branch offices in the Sixth BankingDistrict. Nine of its offices are located in OnondagaCounty, two in Cayuga County, three in OswegoCounty, one in Seneca County, and one in MadisonCounty. The bank ranks fourth in size among the25 commercial banks in the district, and holdsabout 13 percent of all the commercial bank de-posits. It is a wholly-owned subsidiary of the Lin-coln First Banks, Inc., Rochester, N.Y., a registeredbank holding company.

109


The primary service area of the charter bank isOnondaga County, which is virtually coterminouswith the Syracuse Metropolitan Area. That area,with an estimated 1960 population of 423,028,presently enjoys a well diversified and thrivingeconomy. There are about 41 manufacturing con-cerns and over 500 industrial firms in the area thattogether employ an estimated 160,000 civilian resi-dents. The city of Syracuse is the hub of financialand business activities for the whole area, and isthe home of Syracuse University, with a studentenrollment of 17,000, and three other colleges.

The merging bank, with IPC deposits of $5 mil-lion, was organized in 1905. It is the smallest bankin its service area and, with about 0.3 percent ofall the commercial bank deposits, ranks fourthsmallest of the 25 banks in the Sixth BankingDistrict. The bank provides limited banking serv-ices to its customers, and is presently faced witha management succession problem. It faces strongbanking competition from the seven banks operat-ing in Oneida County and two banks located inLewis County, including a branch office of thelargest bank in the district, the Oneida NationalBank and Trust Company of Central New York,which is located almost directly across the streetfrom the merging bank. Competition for the sav-ings dollar is also provided by three savings banks,three savings and loan associations, and five creditunions operating in Oneida County.

The service area of the merging bank extendsfrom the town of Boonville, where the bank islocated, approximately 7 miles to the north andwest, and approximately 15 miles to the south andeast. The economy of this area consists of farming,furniture manufacturing, lumber products, recrea-tional facilities, and milk processing. OneidaCounty, where Boonville is located, was thirdamong the 128 counties in New York and NewJersey in the production of milk during 1968. Inthe past decade, the Boonville area has become amajor recreation center, with significant effects onreal estate investments in the area.

There is no competition presently existing be-tween the participating banks to be eliminated by

consummation of this merger. The closest office ofthe charter bank to the merging bank is the Oneidaoffice, Madison County, about 40 miles away, whichis further separated by hilly terrain and indirecthighway connections. This merger will not elimi-nate potential competition between the two insti-tutions because of the size of the merging bankand the home office protection under the New YorkState law.

The addition of $5 million in deposits to thecharter bank will have no significant effect on con-centration of banking resources in the Sixth Bank-ing District. On the other hand, this merger willbenefit the Boonville area by introducing a bankoffering full banking services and better able tomeet the needs of the area. This merger will alsosolve the management succession problem at themerging bank.

Considered in the light of the statutory criteria,this merger is deemed in the public interest. Theapplication is, therefore, approved.

JUNE 22, 1970.


The closest offices of the merging banks arealmost 40 miles apart. This distance, the presenceof other banks in the intervening area, and thelimited scope of National Exchange's operations,indicate that there is little existing competitionbetween the merging banks. It may be noted thatthe only other commercial bank in Boonville isOneida National Bank and Trust Co. of CentralNew York (total deposits $267 million).

Under New York State law, with certain excep-tions for the New York City area not applicablehere, a bank may branch de novo, subject to homeoffice protection, anywhere within the bankingdistrict in which it is headquartered. Because ofhome office protection, Lincoln National may notestablish a de novo branch in Boonville. WhileLincoln First Banks could be permitted to chartera new bank in that town, the size of the communityand of National Exchange make it unlikely thatthe proposed merger will have a significantly ad-verse effect on potential competition.

110


SECURITY PACIFIC NATIONAL BANK, LOS ANGELES, CALIF., AND BANK OF SACRAMENTO, SACRAMENTO, CALIF.


Bank of Sacramento, Sacramento, Calif., withand Security Pacific National Bank, Los Angeles, Calif. (2491), which hadmerged July 31, 1970, under charter and title of the latter bank (2491). Themerged bank at date of merger had

Total assets

$42,497,3596,722,389,757

6,758,034,271

Banking offices

Inoperation

5408

To beoperated

413


On February 20, 1970, the Bank of Sacramento,Sacramento, Calif., and the Security Pacific Na-tional Bank, Los Angeles, Calif., applied to theOffice of the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of the latter.

The Security Pacific National Bank, with IPCdeposits of $5 billion, is the second largest bankin California, but is far smaller than the Bank ofAmerica, which has deposits of $18 billion. Thisbank serves predominately the southern portion ofthe State; of its 395 branch offices, all except 12are located in Southern California. The bank de-sires to expand its services in the north and into theSacramento Valley through this merger.

The Bank of Sacramento, with IPC deposits of$28 million, was organized in 1962, and presentlyoperates four branch offices, two in Sacramento,one in Davis, which is about 16 miles to the westof the head office, and one in the suburban com-munity of Rancho Cordova, which is about 14miles to the east of Sacramento. Although thebank is located in a vast agricultural area, it hasnot significantly served the agricultural community.Its lending capabilities preclude the bank frommaking large agricultural and commercial loanswhich are increasingly demanded by the agricul-tural and business communities. The bank is notable to offer to its business customers computerservices, and it does not have a revolving creditor credit card plan for individual depositors. Itpresently lacks management depth, and fears itwill not be able to compete in the highly competi-tive market for management talent. While the bankhas shown satisfactory growth, it feels that itsfuture possibilities are limited because of the in-tense banking competition in its area.

The general market area of the merging bankis the Sacramento Standard Metropolitan StatisticalArea, which includes the counties of Sacramento,

Yale, and Placer. The city of Sacramento, with apopulation of about 272,000, is the capital of theState, and the focal point of the entire SacramentoValley, one of California's important agriculturalregions, which encompasses the nine counties ofSacramento, Yale, Placer, Colusa, Sutter, Yuba,Glenn, Butte, and Tehama. In 1968, the Valleyaccounted for approximately one-eighth of the agri-cultural production of the State. Sacramento isabout 87 miles east of San Francisco, and about390 miles north of Los Angeles. Although primarilyresidential, it provides a large base of civil servantemployment, and is a retail trade center for theentire valley. There are over 400 manufacturingestablishments in Sacramento County alone, ofwhich the Aerojet General Corporation is thelargest, with 7,500 employees. Public payrolls inthe county provide jobs for approximately 90,000individuals, and several large military bases provide25,000 civilian jobs.

There are, in the Sacramento Standard Metro-politan Statistical Area, 18 banks operating 126banking offices with total aggregate deposits of $1.4billion. Those banks include Bank of America, with50 offices; Crocker-Citizens, with 22 offices; WellsFargo Bank, with 21 offices; Bank of California,with 5 offices; and United California Bank, with 4offices; all of which together represent 88.7 percentof the total bank deposits in the area. Bank ofSacramento's share of the total bank deposits is 2.4percent, and if the savings accounts, totalling $450million, of the 12 savings and loan associations inthe area are included, the bank's share of themarket is only 1.9 percent. In addition, there are88 offices of consumer finance companies, 70 creditunions, several insurance companies, and variousother lending institutions.

There is presently no significant competitionexisting between the participating banks. Theclosest office of the charter bank to the mergingbank is located in Stockton, about 45 miles south

111


of Sacramento. Security Pacific National Bank esti-mates that less than 0.01 percent of its deposits de-rive from the Sacramento area, and the Bank ofSacramento estimates that less than 0.5 percent ofits deposits derive from the service area of thecharter bank. However, Security Pacific NationalBank has received approval for a branch in Sacra-mento which is expected to reach $14.3 million indeposits in its fifth year. Since this will representonly about 1.7 percent of total bank deposits in themetropolitan area, it is clear that the bank can nothope to become a significant competitive force forseveral years. Expansion into this area, far removedfrom the head office, through de novo branchingwould be difficult and expensive. This merger willprovide the needed deposit base and some of thetrained personnel needed to enable the charterbank to become a significant competitor, in thearea, from the time of its entry. As the area is pre-dominately agricultural, it will benefit fromthe Security Pacific National Bank's experience andexpertise in the field of agricultural loans. Thebank is now engaged in the development of a highlysophisticated data processing service for its farmcustomers that will provide the bank and its cus-tomers with current and accurate financial informa-tion, a tool for planning and making future agri-cultural decisions and for increasing efficiency.

The effect of consummation of the proposedtransaction on the overall competitive structure inthe Sacramento SMSA will be to enhance competi-tion by replacing a small and not vigorous compe-titor with a full-service institution, able to competeeffectively with the large banks operating in thearea. There will be definite competitive advantagesespecially in the field of agricultural loans. Thepublic interest will be served further because theoffices of the Bank of Sacramento will be developedto provide full banking services.

Considered in the light of the statutory criteria,this merger is deemed to be in the public interest.The application is, therefore, approved.

JUNE 8, 1970.


Security has no offices at present in the Sacra-mento area; its main office and branches in theSan Francisco Bay area are some 87 miles away.Its office nearest to Sacramento is in the city ofStockton, 48 miles to the south, in the San JoaquinValley. The amounts of business derived by the

applicants from each other's areas are negligible;the respective areas are also served by a number ofother large California banking institutions. Thus,from an immediate standpoint, the amount ofdirect competition that will be eliminated by theproposed merger appears insignificant.

Security, however, has previously applied for, andreceived approval to open a de novo branch in thenew Capital Mall section of Sacramento, a majorredevelopment project in the downtown area, sixblocks from Sacramento Bank's head office. Thisnew branch will be placed into operation regard-less of whether or not the proposed merger is ap-proved. Thus, while not yet measurable in statis-tical terms, Security is an imminent direct compe-titor in the Sacramento banking market; the pro-posed merger will necessarily eliminate that com-petition.

Banking in Sacramento is highly concentrated;the five largest banks in the area, all of which aremajor California branch networks, currently hold88.7 percent of total commercial bank deposits inthe Sacremento Standard Metropolitan StatisticalArea ("SMSA").

Security, as noted, is already an imminent en-trant into this market. It is also the second largestbanking institution in California; presently it holds11.3 percent of the deposits in the entire State. Ithas had long experience and success in de novobranching. The fact that it made application andreceived approval for a de novo branch in down-town Sacramento is indicative that there is oppor-tunity and need for additional banking facilities inSacramento.

Most importantly, several other statewide, orregional, banking organizations which are notpresently serving the Sacramento area also havetried to enter that market by acquiring SacramentoBank. Given the relatively smaller size of thoseorganizations, they have substantially greater needfor a foothold acquisition in order to make effectiveentry into a concentrated market such as Sacra-mento. Sacramento Bank which has 2.4 percent ofbank deposits in the Sacramento SMSA is a verysuitable vehicle for such entry. Its acquisition bySecurity, which is entering the market in any event,has the effect of eliminating an additional newentrant which in turn means that an additionalforce for deconcentration is excluded from themarket.

This acquisition will eliminate Sacramento Bank

112


as a vehicle for entry by other banking organiza-tions into an area dominated by a few major state-wide branching networks. It will also eliminate

Security as a potential competitor. Therefore, theproposed merger, in our view, will have an adverseeffect on competition.

THE COMMERCIAL NATIONAL BANK OF KANSAS CITY, KANSAS CITY, KANS., ANDEXCHANGE STATE BANK OF KANSAS CITY, KANSAS CITY, KANS.


Exchange State Bank of Kansas City, Kansas, Kansas City, Kans., withand The Commercial National Bank of Kansas City, Kansas City, Kans. (6311),which hadmerged July 31, 1970, under charter of the latter bank (6311) and title "Com-mercial National Bank of Kansas City." The merged bank at date of merger had. .

Total assets

$15,619,327

108,190,718

117,021,889

Banking offices

Inoperation

1

1

To beoperated

1


On April 1, 1970, Exchange State Bank of KansasCity, Kansas, Kansas City, Kans., and The Com-mercial National Bank of Kansas City, Kansas City,Kans., applied to the Comptroller of the Currencyfor permision to merge under the charter of thelatter and with the title "Commercial NationalBank of Kansas City."

The Commercial National Bank of Kansas City,with IPC deposits of $50.5 million, was originallyorganized as a State bank in 1897. It acquired aNational charter in 1902, and has since operatedunder its present name.

Exchange State Bank of Kansas City, charteredin 1905, holds IPC deposits of $13 million. Inrecent years, the merging bank'^ deposits haveshown no growth.

Both banks are located in Wyandotte County,one of the seven counties which make up theKansas City, Kansas-Missouri Metropolitan Area.The relevant market area, which is considered to bethe entire urban area, has an estimated populationof 1.4 million, supports a diversity of industries,and is considered to be a major wholesaling, retail-ing, and transportation center. In contrast to thepresent and projected growth of the urban com-plex, Wyandotte County's growth in recent yearshas been slow, and its projected growth is thelowest of the seven counties. This county, whichincludes the main business district of Kansas City,Kans., is an unattractive and declining area suffer-ing from the effects of urban decay.

Seven banks, including the two applicants, arelocated within a radius of three blocks in down-

town Kansas City. In addition to those seven banks,12 other banks operate in Wyandotte County. Thecharter bank and Security National Bank, whichis the sixth largest bank in the Kansas City Metro-politan Area, are the two largest banks in thatcounty. Those two banks compete on an areawidebasis, while the other smaller banks, including themerging bank, compete on a more localized basis.In recent years, the center city banks have declinedin relative importance as their share of the totalbank deposits in Wyandotte and Johnson countieshas decreased from 58 percent in 1953, to 38 per-cent in 1969.

Competition among the 125 banks in the KansasCity Metropolitan Area is intense. Commerce TrustCompany, Kansas City, Mo., with $554 million, or15 percent of the total deposits, is the largest insti-tution. First National Bank of Kansas City, KansasCity, Mo., ranks second with $391 million, or 10.9percent of the deposits. The third largest bank,City National Bank and Trust Company of KansasCity, Kansas City, Mo., with deposits of $369 mil-lion, holds approximately 10 percent of the area'sdeposits. The charter bank, with 3 percent of thedeposits in the area, is the fifth largest bank, whilethe Exchange State Bank of Kansas City is the 47thlargest bank in the market area, with only 0.42percent of total area deposits. The resulting bankwill rank as the fourth largest bank in the area.

Additional competition is felt from many non-bank financial institutions, including 30 savingsand loan associations, with deposits of $1.6 billion,and numerous sales finance and personal loancompanies. Competition is provided by 197 State-

113


chartered and 32 federally-charted credit unions,as well as by insurance companies and direct lend-ing agencies of the Federal Government.

Competition between the two banks is not con-sidered significant due to the general character oftheir respective operations and the presence ofother banks in the area. While the charter bank isprimarily a wholesale bank operating on a metro-politan and regional basis, the merging bank'soperations are principally retail in character withits trade limited to Wyandotte County. The limiteddegree of competition between the applicant banksis further evidenced by their lack of common cus-tomers and the existence of common ownership.This merger will not result in dislocation or im-balance in the present area banking structure.Furthermore, because of the numerous bankingoffices in close proximity, consummation of thismerger will leave the banking public a wide choiceof alternate banking facilities.

Approval of this application will benefit thebanking public in the service area of the resultingbank. The increase in the charter bank's lendinglimit will allow the bank to compete more aggres-sively for large commercial and industrial loans inthe area. The merging bank's asset problems will beimproved by merger with the well capitalizedcharter bank. Consummation of this merger willsolve the management succession problem in themerging bank, and will enable the resulting bankto provide the merging bank's customers with abroad range of additional banking services notpresently available from the merging bank, includ-ing an experienced trust department and dataprocessing facilities. Merger is the only means,other than internal growth, by which the charterbank can expand its operations to better meetcompetitive forces and serve the community.

This proposal will promote the public interestwithout lessening competition. The application is,therefore, approved.

JUNE 24, 1970.


Since the banks involved in this proposed mergerare located within two blocks of each other in theprincipal business district of downtown KansasCity, Kans., the merger will result in the elimina-tion of direct competition. However, commercialbanking in the Kansas City, Missouri-Kansas area,consisting of both Kansas City, Mo., and KansasCity, Kans., as well as the suburban area adjacentto the latter in Johnson County, Kans., is domi-nated by three Kansas City, Mo., banks, muchlarger in size than either of the merging banks. Theresulting bank, with deposits of $121.6 million, asof June 29, 1968, would rank fourth in this area.Nevertheless, the effect of the merger would be toreduce competition.

As of June 29, 1968, the three largest banks held48.6 percent of all IPC demand deposits in thearea; the merging banks rank 5th and 40th amongapproximately 50 banks in the area and, as of thesame date, held 1.5 percent and 0.4 percent, re-spectively, of such deposits, and 3.1 percent and0.6 percent, respectively, of total deposits in thearea. After the merger, the resulting bank will rankfourth in the area, increasing concentration byless than 1 percent. It is to be noted that the fore-going market share and concentration figures donot reflect the existing affiliations among many ofthe area banks, nor the existence of substantialamounts of stock ownership in a number of areabanks, including each of the merging banks, heldby certain family groups which number amongtheir members officers and directors of a number ofKansas City, Kans., banks, including the secondlargest bank in that city. However, the informationpresently available to this Division indicates thatthe respective market shares of the merging bankswould be increased by less than 1 percent if affilia-tions were considered.

To summarize, the proposed merger will elimi-nate direct competition and will slightly increasebanking concentration in the Kansas City, Missouri-Kansas area.

114


SOUTHERN NATIONAL BANK OF NORTH CAROLINA, LUMBERTON, N.G., AND BANK OF CHARLOTTE, CHARLOTTE, N.C.


Banking offices

Inoperation

To beoperated

Bank of Charlotte, Charlotte, N.C, withand Southern National Bank of North Carolina, Lumberton, N.C. (10610),which hadmerged Aug. 1, 1970, under charter and title of the latter bank (10610). Themerged bank at date of merger had

$23,910,939

167,058,069

202,508,937

1

46

47


On April 25, 1970, the Bank of Charlotte, Char-lotte, N.C, and the Southern National Bank ofNorth Carolina, Lumberton, N.C, applied to theComptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

The Southern National Bank of North Carolina,Lumberton, N.C, with IPC deposits of $131.5 mil-lion, was organized as a State bank in 1897, andacquired a National charter in 1914. The bank'sservice area was limited to the Lumberton, N.C,area until 1959, when it commenced a de novobranch expansion program within a 50-mile radius.As a result of this progam, as well as of acquisi-tions, the bank now operates 42 branches in 25communities throughout the State.

The Bank of Charlotte, Charlotte, N.C, withIPC deposits of $16.1 million, was organized in1917, and now operates as a unit bank from anoffice in the central business district of Charlotte.It has primarily concentrated in retail bankingtransactions, and has a relatively large volume ofinstallment loan business. The merging bank hasbeen owned by a single family over the years, andits growth is attributed to the economic vitality ofthe Charlotte area rather than the aggressivenessof its management.

Charlotte, the largest city in North Carolina,with an estimated population of 275,000, is locatedwithin 10 miles of the South Carolina State line,and serves as the principal distribution and finan-cial center for both states. Its rate of populationgrowth is 3 percent per annum, which is amongthe highest in the Nation for cities of comparablesize, and is indicative of the area's overall expan-sion. Though Charlotte has been primarily a dis-tribution center serving an important industrialregion, new industrial investments have been im-pressive in recent years. Banks in the Charlotte

area are keenly competitive, with de novo entryinto the area being expensive; in addition, con-siderable time would be required for a bank tobecome established and develop an adequate busi-ness base to be competitive.

The charter bank has no branches in the relevantmarket area; its nearest facility is located some 60miles from the merging bank in Mount Gilead,N.C. Thus, there is no competition between themerging banks. The resulting bank, with 2 percentof total area deposits, will rank sixth, after the fivelargest statewide banks which already maintainoffices in the Charlotte-Mecklenburg area: Wacho-via Bank and Trust Company, N.A., Winston-Salem, N.C, with total deposits of $1,328 million;North Carolina National Bank, Charlotte, N.C,with total deposits of $1,088 million; First UnionNational Bank, Charlotte, N.C, with total depositsof $866 million; First Citizens Bank and TrustCompany, Smithfield, N.C, with total deposits of$610 million; and Northwestern Bank, NorthWilkesboro, N.C, with total deposits of $423 mil-lion, all of which are substantially larger than theresulting bank. Additional competition is feltthroughout the area from savings and loan asso-ciations, finance companies, credit agencies, andmortgage production offices. Since the charter bankwill merely replace the merging bank, consumma-tion of the merger will not reduce the number ofalternate banking facilities.

The merger will benefit the charter bank by bring-ing it into a rapidly growing economic area. Thecharter bank's deposit base originates in agricul-turally-oriented communities, and is therefore sub-ject to marked fluctuations. The addition of Char-lotte to the bank's service area will diversify andbalance its operating base.

The aggressive management, the size, and thecapital structure of the charter bank, which utilizessophisticated electronic equipment and modern

115


banking practices, will enhance the competitiveposition of the resulting bank in the Charlottearea. The proposed merger will bring to the cus-tomers of the merging bank the resources of alarger bank offering broader services, includingautomated bookkeeping, trust services, a credit cardprogram, and dealer financing.

Applying the statutory criteria, we find that themerger is in the public interest, and the applica-tion, therefore, is approved.

JUNE 29, 1970.


Southern's nearest office to the Bank of Charlotteis in Rockingham (population 5,512), county seatof Richmond County, 64 miles southeast of Char-lotte. Numerous banking alternatives are availableto residents of Charlotte and Mecklenburg County.The proposed merger, if approved, will not elimi-

nate any substantial existing competition betweenthe banks.

Southern has no Mecklenburg County office, andshould be considered a potential entrant into thisattractive and growing market.

However, it is unlikely that Southern's de novoentry into Charlotte, permitted under State law,would be significantly different in competitiveeffect than the present acquisition. The Bank ofCharlotte has only one office and about 2 percentof the total deposits of Mecklenburg County, wherethe State's four largest banks now hold about 90percent of county total deposits of $848.2 million,and have 75 percent of the county's 77 bankingoffices.

To summarize, in view of the small relative sizeof the Bank of Charlotte and its modest position inthe highly concentrated banking market in Char-lotte and in Mecklenburg County, we conclude thatthe proposed merger is not likely to have a sig-nificantly adverse effect on potential competition.

NATIONAL BANK OF AGRICULTURE, DELANO, CALIF., AND THE FIRST NATIONAL BANK OF CARUTHERS, CARUTHERS, CALIF.


National Bank of Agriculture, Delano, Calif. (15450), withand The First National Bank of Caruthers, Caruthers, Calif. (11330), which had. .consolidated Aug. 7, 1970, under charter of the latter bank (11330) and title"National Bank of Agriculture." The consolidated bank at date of consolidationhad

Total assets

$12,832,5434,087,442

17,971,623

Banking offices

Inoperation

31

To beoperated

4


On May 8, 1970, The First National Bank ofCaruthers, Caruthers, Calif., and the National Bankof Agriculture, Delano, Calif., applied to theComptroller of the Currency for permission to con-solidate under the charter of the former and thetitle of the latter.

The First National Bank of Caruthers, Caruthers,Calif., was organized in 1919, and remains a unitinstitution with IPC deposits of $2.4 million. Con-tinuing asset problems and unaggressive competi-tive practices have resulted in a poor earningsrecord at the charter bank, which does not offerextended banking hours, night depository, safedeposit, escrow, or trust services.

The economy of the market area of The First

National Bank of Caruthers is relatively static, anddepends primarily upon grapes and cotton farming.A large majority of the approximately 5,000 indi-viduals who populate the bank's service area aretenant farmers and small land owners with limitedresources.

The National Bank of Agriculture, Delano, Calif.,with IPC deposits of $3.8 million, was organized in1964, and now operates branches at Fresno, inFresno County, and at Bakersfield, in KernCounty. The National Bank of Agriculture's mar-ket area includes the most populous and mostprosperous portions of Fresno and Kern counties.These counties lie in the San Joaquin Valley, anextremely productive farming region. In FresnoCounty, which has ranked first in the Nation for

116


agricultural production since 1950, crop values in-creased from $389 million, in 1960, to $463 million,in 1968. The cities of Fresno and Bakersfield arethe financial, industrial, and shopping centers ofthe San Joaquin Valley. The new and expandingindustry developing in and around Fresno andBakersfield offsets losses of jobs resulting from theincreased mechanization of farming. Both cities aregrowing in employment and population.

There is very little competition between the con-solidating banks; their nearest offices are 15 milesapart. The charter bank has not, in any event,proven to be an aggressive competitor. The con-solidated bank will continue to compete with theoffices of major regional and statewide banks.

Consummation of the proposed consolidationwill provide the Caruthers area with a locally-oriented bank offering a broader range of servicesto the agricultural businesses in the Fresno-Bakers-field-Delano market area. However, the consolida-tion will enable the National Bank of Agricultureto relocate its main office from the small agricul-tural town of Delano to the city of Fresno.

Applying the statutory criteria to the proposedconsolidation, it is concluded that it will serve thepublic interest. The application is, therefore, ap-proved.

JULY 7, 1970.


In Fresno County, which has a population ofalmost 400,000, there are offices of most of the bigstatewide banks, nearly all of which are in or nearFresno itself. The Caruthers Bank is the only banklocated in Caruthers, although the branch of amajor statewide bank is located about 10 milessouth of the town.

The consolidation will eliminate whatever com-petition now exists between the two banks; how-ever, the consolidated bank will have less than 2percent of the commercial bank deposits in FresnoCounty. Since the two banks engage in only limitedcompetition and are not of substantial size, thisconsolidation is not likely to have any significantlyadverse effect on competition.

MAINE NATIONAL BANK, PORTLAND, MAINE, AND THE FIRST NATIONAL BANK OF PITTSFIELD, PITTSFIELD, MAINE


The First National Bank of Pittsfield, Pittsfield, Maine (13777), withand Maine National Bank, Portland, Maine (4128), which hadmerged Aug. 14, 1970, under charter and title of the latter bank (4128). Themerged bank at date of merger had

Total assets

$12,129,152190,482,404

202,611,556

Banking offices

Inoperation

224

To beoperated

26


On May 13, 1970, the Maine National Bank,Portland, Maine, and The First National Bank ofPittsfield, Pittsfield, Maine, applied to the Comp-troller of the Currency for permission to mergeunder the charter and title of the former.

The Maine National Bank was founded in 1889,under the title of the Portland National Bank, andacquired its present title in 1968. The bank oper-ates 18 branches, and holds IPC deposits of $135million. This bank has enjoyed large increases inearnings in recent years and has excellent futureprospects. As a full-service bank, it offers a widevariety of banking services, including trust, com-

puter and data processing, credit card, travelagency, and business development services.

The market area of the Maine National Bankencompasses the five coastal counties of Cumber-land, York, Sagadahoc, Lincoln, and Knox, as wellas the two interior counties of Oxford and Frank-lin. The coastal counties comprise a 130 milestretch along Maine's southeastern coast. Theirpopulation, estimated at 365,000, is 37 percent ofMaine's total population. This region's economyrests primarily upon manufacturing, agriculture,tourism, marine products, and mining. Portland,Maine's largest city and commercial center, islocated in Cumberland County, in the middle ofthis region. Oxford and Franklin counties, located

117


on Maine's western border, became a part of thebank's market area after a merger in 1968. Theircombined population is 65,000, and their economyis based on lumbering, farming activity, tourism,and manufacturing of wood products.

The First National Bank of Pittsfield was found-ed in 1933, and operates one branch at Hartland,Maine. This is a small bank offering limited serv-ices, with IPC deposits of $9.4 million. It needs toprovide for management succession, since its presi-dent and vice-president are nearing retirement ageand proper replacements are unavailable withinthe present management group.

The market area of The First National Bank ofPittsfield includes Somerset County's two manufac-turing towns of Pittsfield and Hartland, with popu-lations of 5,000 and 1,500, respectively. SomersetCounty's population is 40,000. The county'seconomy rests primarily on Pittsfield's and Hart-land's manufacturing enterprises.

There is no competition between offices of themerging banks which, at the closest point, are 70miles apart. This merger will not unduly concen-trate banking assets in the Somerset County marketarea because other major banks operate offices inPittsfield.

Consummation of the merger will introduceanother large, full-service bank to the SomersetCounty market area. Banking competition therewill be enhanced. The resulting bank's Pittsfieldand Hartland branches will experience significantlyincreased lending capacities, and will make avail-able the broader range of banking services offeredby the charter bank. The merging bank's manage-ment succession needs will be filled from the charterbank's management trainee pool.

Applying the statutory criteria to the proposedmerger, we conclude that it serves the public inter-est. The application is, therefore, approved.

JULY 9, 1970.


The head offices of the participating banks are99 miles apart, and their closest offices are some 70miles apart. The merger would not, therefore, ap-pear to eliminate any significant existing competi-tion between the merging banks.

The service area of Pittsfield Bank is confinedto the southeastern portion of Somerset County. Atpresent, no other commercial banks operate officesin this limited area, although competition isafforded by offices of Depositors Trust Company,the Newport Trust Company (a subsidiary ofDepositors Corporation), and the Merrill TrustCompany in adjacent areas. Depositors Trust Com-pany also has filed an application to open a de novooffice in Pittsfield. According to the application,Pittsfield Bank receives indirect competition fromthe Federal Trust Company, headquartered inWaterville. Merrill Bankshares, parent companyof the Merrill Trust Company, has recently re-ceived approval to acquire this bank.

Thus, the service area of Pittsfield Bank appearsalmost entirely surrounded by offices of two ofMaine's largest banking institutions, DepositorsCorporation and Merrill Bankshares. The entry ofMaine National into this area would add a thirdmajor bank to this general area of central Maineand could enhance competition.

Under applicable State law, Maine National can-not open a de novo office in Somerset County, exceptin communities where no banks regularly transactbanking business. Another possible alternative,formation of a holding company and the charteringof a new bank in the area, is presently the subjectof litigation involving another banking institution,although Maine National is clearly one of the mostable banks to follow this course. There are no othermerger alternatives for Maine National in the serv-ice area of Pittsfield Bank.

THE INDIAN HEAD NATIONAL BANK OF NASHUA, NASHUA, N.H., AND THE WILTON NATIONAL BANK, WILTON, N.H.


$10,266,204

61,808,730

72,071,608

Banking offices

Inoperation

1

4

To beoperated

5

The Wilton National Bank, Wilton, N.H. (13247), withand The Indian Head National Bank of Nashua, Nashua, N.H. (1310), whichhadmerged Aug. 14, 1970, under charter and title of the latter bank (1310). Themerged bank at date of merger had

118



On April 29, 1970, The Wilton National Bank,Wilton, N.H., and The Indian Head NationalBank of Nashua, Nashua, N.H., applied to theOffice of the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of the latter.

The Indian Head National Bank, with IPC de-posits of $47.9 million, was chartered as a Nationalbank in 1865. In 1934, it became a subsidiary andthe lead bank of New Hampshire Bankshares, Inc.,a bank holding company subsequently registeredas such in 1956. State banking law changes in 1963,making branch banking permissible within certainlimitations, brought about the establishment of twode novo branches. In 1969, this bank merged withThe Salem Trust Company, Salem, N.H., whosesole office became its third branch.

Nashua, N.H., the home of the charter bank, is acity with a population of about 50,000, and islocated 39 miles northwest of Boston, Mass., and 18miles south of Manchester, N.H., within easy com-muter distance of the economic cores of bothstates. Across the Massachusetts border, three majorindustrial centers, viz. Lowell, Lawrence, and Hav-erhill, provide additional sources of employmentfor area residents. Within the city limits of Nashua,in 1968, there was a recorded employment of 36,802of which 17,069 were in manufacturing fields.Sanders Associates, Inc., employing 6,900 in elec-tronics work, was a leader in the local economy.

In addition to the charter bank, the bankingneeds of the Nashua area are provided for by theNashua Trust Company, with deposits of $42 mil-lion, and the Nashua branch of the Bank of NewHampshire, N.A., Manchester, N.H., with totaldeposits of about $86 million. Two federal savingsand loan associations with combined deposits of$59 million provide additional sources of financialservices. The presence and growth of Indian HeadNational Bank of Nashua is required to preservethe balance of local banking competition.

The Wilton National Bank, Wilton, N.H., withIPC deposits of $8.4 million, is a unit banking insti-tution, organized in 1928 and affiliated with NewHampshire Bankshares, Inc., since 1934. Continuityof management is not provided for except throughholding company channels. Wilton is a town with apopulation of about 2,280, and is located 16 mileswest of Nashua. Wilton has been a static com-munity for a number of years, and local employ-

ment is still dominated by two family enterprisesemploying 500 workers. One of these companies isreported to be closing, thus eliminating 124 jobs.Additional industrial and commercial activity isvery limited. The surrounding towns and country-side are engaged primarily in agricultural andservice pursuits.

The Souhegan National Bank, Milford, N.H.,with deposits of $10.7 million, is the only commer-cial bank within the service area of the mergingbank. The main office of this bank is located 5miles east of Wilton, and its only branch is 3 milesfurther east. A small savings bank, located to thesouth, in Greenville, N.H., is the only other bankwithin 10 miles of the merging bank.

When this transaction is consummated, the Wil-ton office of the resulting institution will offer ex-panded business loan capabilities, trust services,and, within a short time, computer services. Theresulting bank's capital position will permit theerection of a more convenient banking facility withmodern customer service features. In the Nashuaarea, the beneficial effects of the merger will in-clude an increased lending limit, a broadenedmarket area, and an improved base for the imple-mentation of electronic data processing services.

Competition will not be adversely affected. Sincethe banks are presently affiliated, and their serviceareas do not overlap, there is little competition be-tween them. In Nashua, the charter bank's opera-tions will be strengthened, with the result that itshould become a more effective competitor withoutcausing an imbalance of existing competitive rela-tionships. Since there are no other banks in Wilton,competition will not be affected in that community.The Souhegan National Bank and the savings banklocated in Greenville, N.H., should continue tooperate effectively without adverse competitiveeffects from this merger.

Applying the statutory criteria, we find that themerger is in the public interest. The application,therefore, is approved.

JULY 10, 1970.


The two banks involved in the proposed mergerare both long standing subsidiaries of New Hamp-shire Bankshares, Inc., a registered bank holdingcompany. It is, therefore, unlikely that the pro-posed merger will eliminate any effective competi-tion.

119


NATIONAL BANK OF WASHINGTON, TACOMA, WASH., AND THE PACIFIC NATIONAL BANK OF SEATTLE, SEATTLE, WASH.


The Pacific National Bank of Seattle, Seattle, Wash. (13230), withand National Bank of Washington, Tacoma, Washington, Tacoma, Wash. (3417),which hadconsolidated Aug. 17, 1970, under charter of the latter bank (3417) and title"Pacific National Bank of Washington." The consolidated bank at date of con-solidation had . . . . .

Total assets

$254,292,665

454,265,462

708,296,502

Banking offices

Inoperation

16

44

To beoperated

60


On December 31, 1969, the National Bank ofWashington, Tacoma, Wash., and The Pacific Na-tional Bank of Seattle, Seattle, Wash., applied tothe Comptroller of the Currency for permission toconsolidate under the charter of the former andwith the title "Pacific National Bank of Washing-ton," with headquarters in Seattle.

The National Bank of Washington, Tacoma,Wash., was organized in 1885, and now holds IPCdeposits of $343 million. The bank operates 43branches, of which 16 are located in Tacoma andits suburbs, 5 are located elsewhere in PierceCounty, 2 are located in the southern portion ofKing County, and the remaining 20 offices arescattered throughout the State. The charter bank,which is a subsidiary of Western Bankcorporation,Los Angeles, Calif., emphasizes retail banking serv-ice. A major reason for this application is thecharter bank's desire to make a meaningful entryinto Seattle to enable it to compete with the State'slargest banks, and to service the banking businessof its customers who have relocated to that city.

Tacoma, the site of the headquarters of thecharter bank, lies at the northern end of PierceCounty. It is the third largest city in the State ofWashington, with the 1969 population estimated atabout 161,000. The population of Pierce County isapproximately 393,000. The economy of the Tacomaarea depends primarily on natural resource indus-tries including the extraction and smelting of min-erals and the production of lumber and wood prod-ucts. Two major military installations, Fort Lewisand McChord Air Force Base, are located approxi-mately 12 miles south of Tacoma. The metallurgi-cal and food processing industries are gaining inimportance, while the presence of an excellentnatural harbor has provided the stimulus for an

important shipbuilding industry. While the Tac-oma area is expected to experience further gainsin employment and population, it is subject tocyclical swings due to its dependence on the hous-ing industry and military activity. There are 10commercial banks with offices in Pierce County,including four with headquarters in Tacoma.

The Pacific National Bank of Seattle, Seattle,Wash., was organized in 1928, and now holds IPCdeposits of $183 million. The bank operates 15branches, all of which are in the immediate Seattlearea except for the Military Road branch, whichis located 14 miles south of Seattle in an unincor-porated area in King County. Several of thesebranches are more in the nature of service facilitiesto corporate customers rather than sources of newbanking business.

Seattle, where the consolidating bank operates,is located in the eastern portion of King Countyand is the largest city in the State of Washington,with a population estimated at 591,000. About one-third of the State's inhabitants reside in KingCounty in the general vicinity of Seattle. Seattle isa major industrial center with the aerospace andrelated industries of primary importance. TheBoeing Company, in late 1969, provided employ-ment for 81,200 persons, or approximately 13 per-cent of the Seattle employment market. Shipbuild-ing and other heavy industries are also of greatimportance. Because of its excellent port facilities,Seattle is a major center for world trade. It is alsoan important wholesale trade and distributioncenter. The University of Washington, with astudent enrollment of 30,000, is located in Seattle.

Seattle is also the financial center of the State,and the headquarters city for Washington's largestbanks. Eleven of the 13 banks operating in theSeattle area maintain their headquarters in this

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city; the consolidating bank is the fourth largestof those. The largest bank, the Seattle-First Na-tional Bank, Seattle, Wash., holds 34.3 percent ofSeattle deposits, while the National Bank of Com-merce, Seattle, Wash., holds 24.5 percent of thesame. The consolidating bank is heavily orientedtowards commercial banking business, with 73 per-cent of its IPC demand deposits and 77 percent ofits loans representing commercial banking activity.Due to its limited size, it has had difficulty in servic-ing the major borrowing needs of its customers;because it has had to participate large amounts ofits corporate loans, it has lost important customersto banks with higher lending limits. Its dependenceon commercial business has also caused it to lagbehind its competitors in King County in overallgrowth, and has made it unusually subject to thecyclical swings of the business enterprises it services.

There is virtually no competition between theparticipating banks whose head offices are separatedby 32 miles. The nearest branch of the consolidat-ing bank to an office of the charter bank is theMilitary Road branch, located south of Seattle,which is 5.6 miles and 6.7 miles from the Kent andAuburn branches, respectively, of the charter bank.

The development of competition between thoseoffices has been, and will be, minimal in that theyare separated, not only by a railroad and a majorinterstate highway, but also by a bluff that makesdirect travel between them difficult. In addition,offices of the State's three largest banks are locatedin the intervening area.

The possibility of future competition betweenthe consolidating banks appears very remote. TheState of Washington's restrictive branching lawspermit statewide branching only through merger,and permit de novo branching only within thecounty in which the bank's headquarters are lo-cated, or in cities and towns which do not have acommercial banking office. Those laws would pre-vent the banks from coming into direct competitionin their principal market areas through de novobranching. Thus, each participating bank mayenter the principal market area of the other onlythrough merger. However, legal and banking con-siderations severely limit the possibility of any suchprospective merger other than the subject applica-tion. The provisions of federal banking law wouldnot permit Western Bancorporation or either ofthe consolidating banks qua bank to charter a newbank to be used later as a vehicle to effect marketentry through merger. A merger of the National

Bank of Washington with one of the existing smallindependent banks located in Seattle would leavethe resulting bank without the branch system neces-sary to make a meaningful competitive entry intothat city; it could not, once there, establish furtherbranches under the State's branching laws. Such asmall merger, coupled with the relocation of theNational Bank of Washington's headquarters toSeattle, would subject the bank to the costly re-quirement of maintaining a higher reserve on itssystem deposits, without any assurance of acquir-ing regulatory approval for the establishment of asatisfactory branch system in a city with an alreadyhigh population per banking office. Furthermore,while the Pacific National Bank of Seattle couldmerge with one of the small independent banks inPierce County, or in another county in a com-munity where charter bank presently has a branch,such a development would hypothesize a revolu-tionary reorientation from this bank's present de-velopment pattern which has kept it in the Seattlearea with a primarily wholesale outlook. It wouldtherefore appear that the consolidating banks can-not realistically be viewed as potential competitors.

Consummation of this proposal will consolidateWashington's fourth and sixth largest commercialbanks to create the State's third largest bankinginstitution, which will hold 11.2 percent of theState's commercial bank deposits. Since the consoli-dating banks operate in geographically distinctareas, approval of this application will not increasebanking concentration in any market area in theState. The effect of this transaction will be to createan institution with headquarters in Seattle, theState's commercial and financial center, which willbe capable of competing effectively with the State'stwo largest banks, both of which have statewidebranching systems, viz. Seattle-First National Bank,Seattle, Wash., which, with deposits of $1.7 billion,holds 31.8 percent of the State's commercial bankdeposits; and the National Bank of Commerce ofSeattle, Seattle, Wash., which, with deposits of over$1 billion, holds 19 percent of the State's commer-cial bank deposits. Approval of this application willcreate a bank, with virtually a statewide branchsystem, which will be in a position to challenge thedominance those institutions have in Washington'sfinancial life, and which will increase the qualityof competitively offered banking services. Addi-tional banking competition will be encounteredfrom the Seattle and Tacoma branches of TheBank of California, N.A., San Francisco, Calif., with

121


total deposits of about $1.6 billion; the PeoplesNational Bank of Washington, Seattle, Wash., withdeposits of $385 million; and the Old NationalBank of Washington, Spokane, Washington,Spokane, Wash., with deposits of about $295 mil-lion. Mutual savings banks with recently expandedlending powers, certain trust powers, statewidebranching privileges, and the right to convert tocommercial banks are also important competitivefactors in Washington. The two largest of these arethe Washington Mutual Savings Bank, Seattle,Wash., which, with deposits of $719 million, hasbranches in Tacoma and other locations; and theFidelity Mutual Savings Bank, Spokane, Wash.,which, with deposits of $205 million, maintainsbranches in Seattle as well as other locations.

Approval of this application will benefit thebanking public in the major geographical areasaffected by this proposal. The charter bank's spe-cialization in consumer banking services, and theconsolidating bank's commercial banking orienta-tion will enable the consolidated bank to improvethe quality of services to both classes of customers.With the significant base that this transaction willprovide in Seattle, the consolidated bank will beable to participate fully in the State's economicand financial life, and to provide fuller service tocommercial customers located in Tacoma, as wellas to those whose corporate headquarters havegravitated to Seattle. The larger lending limit ofthe consolidated bank will reduce the need of theconsolidating bank to participate large credit lines,and will assist the consolidated bank in retainingthose customers whose heavy borrowing require-ments have increasingly caused them to seek theservices of the State's largest banks or of out-of-Statebanks. The charter bank's comprehensive branchnetwork will permit the transfer of funds fromrural, capital-surplus areas, to the urban, capital-deficit areas to be served by the consolidated bank.With headquarters in the northwest's most im-portant trade center, the consolidated bank will bein a position to increase the scope of internationalbanking services offered to customers, in Tacomaand Seattle, who have commercial interests over-seas, possibly through the establishment of foreignbranches, or of an Edge Act Corporation. Thecharter bank's retail banking experience will enablethe resulting bank to improve the quality and in-crease the range of consumer services to customersin the area now served by the consolidating bank.

It is anticipated that the consolidated bank willprovide, throughout its service area, certain con-sumer services such as bank credit card and check-guaranty programs, that are not presently providedby either bank. In addition, the larger capital baseof the consolidated bank will provide it with anincreased capability with respect to loans to newindustry, and small business participation in urbansocial programs, and will expand its bond under-writing capacity.

Applying the statutory criteria, we find that theconsolidation is in the public interest, and theapplication, therefore, is approved.

JULY 17, 1970.


National Bank's headquarters is located 32 milesfrom Pacific's headquarters in Seattle. Pacific has nobranch offices in Pierce County, but National Bankoperates two branches at Kent (population 17,065)and Auburn (population 21,300) in the southernpart of King County. The closest office of Pacific tothese branches is located in an unincorporated areaon Military Road, some 5.6 road miles from Na-tional Bank's Kent office, and some 6.7 miles fromits Auburn office. Branches of the State's threelargest banks are located in the areas between Na-tional Bank's branches and Pacific's Military Roadbranch. Consequently, it would not appear thatthe proposed consolidation would eliminate sub-stantial direct competition.

Banking in Seattle and King County is highlyconcentrated. As of June 29, 1968, the four domi-nant banks in that county, including Pacific, heldnearly 88 percent of all commercial bank depositsand nearly 90 percent of IPC demand deposits.Pacific alone held over 13 percent of IPC demanddeposits, and was the third largest bank in thecounty in that category, although it ranked fourthin overall deposits, with 10 percent. Of the ninebanks in the State with deposits of over $100million, six presently have offices in Seattle.Another has recently announced plans to mergewith a small Seattle bank. Thus, only two Wash-ington banks with deposits of over $100 milliondo not presently serve Seattle. National Bank is byfar the largest of these two potential entrants, italready has two offices in King County, and it hasindicated its desire to continue to enter Seattle andexpand throughout King County. In view of thesefacts, National Bank must be considered the most

122


likely potential entrant into the highly concen-trated Seattle and King County commercial bank-ing markets.

In Tacoma and Pierce County, as of June 29,1968, National Bank controlled over 42 percent ofcommercial bank deposits. Moreover, the twolargest commercial banks controlled over 80 per-cent of such deposits. Pacific is one of four banksin the State with deposits of over $100 million thatdo not serve Tacoma and Pierce County. Of thosefour banks, one is based in Spokane, in easternWashington, and has only recently begun to enterthe western portions of the State, and a second issubstantially smaller than Pacific. Therefore,Pacific would appear to be one of the most likelyentrants into Tacoma and Pierce County.

Under Washington's restrictive branch bankinglaws, a bank may establish de novo branches in thecity in which it has its principal place of business,in unincorporated areas in the county in which ithas its headquarters, and in incorporated cities andtowns which do not have a banking office of anycommercial bank. Consequently, the participantsto this proposed merger may not establish de novobranches in each other's markets in Tacoma orSeattle. However, they can enter each other's serviceareas by acquisition of smaller banks or by openingoffices in communities which do not have any bank-ing offices.

Specifically, National Bank could enter Seattleproper by acquiring any of the three small inde-pendent banks which exist in that city. It couldeither move its headquarters to Seattle at that point,and thereafter open further branches, or, as a con-dition of the merger, have the acquired bank obtaina number of new branch authorizations. In thealternative, National Bank could acquire a smallstock interest in a Seattle bank or assist in charter-ing a new one which could serve its interests inthe city. Such a bank could subsequently mergewith National Bank, if the parties so chose. Finally,there are some nine other banks located outside ofSeattle, but within King County. National Bankmight acquire one of those banks in order to estab-lish more effectively its presence in the Seattle area.

Pacific could enter Pierce County through themethods described above. There are five small bankspresently serving Pierce County, of which one islocated in Tacoma. In addition, Pacific could assist

in chartering a new bank to serve Tacoma or otherparts of Pierce County and subsequently mergewith such a bank.

The proposed merger's effect upon potentialcompetition is not limited to the Seattle and Ta-coma markets. Banking in the State of Washington,as a whole, is highly concentrated. The five largestbanking organizations, including National Bank,control over 70 percent of commercial bank depositsin the State, and this merger would increase thatconcentration ratio to 74 percent. The nine bankingorganizations with deposits of over $100 million,including both merging banks, control over 84 per-cent of such deposits. This high statewide concen-tration is reflected in local markets throughout theState.

Outside of Pierce and King counties, there are 15counties with populations, as of 1960, of 40,000 ormore. National Bank has offices in eight of thosecounties, including the seven with a population ofover 75,000. In those eight counties, the aggregatemarket share of the five largest banks in the Stateranges from 62 percent to 96 percent of commercialbank deposits. Pacific, on the other hand, has notexpanded outside of King County, and is one ofonly a very few of the State's largest banks whichhas not expanded outside of its headquarters area.

There are seven counties outside of Pierce andKing counties with populations of over 40,000 inwhich neither National Bank nor Pacific has offices.In those seven counties, the aggregate market shareof the five largest banks in the State ranges from50 to 94 percent of county commercial bank de-posits. National Bank and Pacific are among thelargest of a relatively small number of banks whoare large enough to inject a significant competitiveforce into these counties via new entry.

Overall, this merger will result in eliminatingsubstantial potential competition in Seattle andKing County, Tacoma and Pierce County, and inthe other 15 most populous counties in the State.This merger will also combine banking organiza-tions which are leading factors in two adjacentbanking markets. As a result, this merger may deternew entrants, chill existing competition, and limitthe likelihood of eventual deconcentration in anumber of highly concentrated markets. We con-clude that this merger will have a significantlyadverse effect on competition.

123


NORTH CAROLINA NATIONAL BANK, CHARLOTTE, N.C., AND THE STATE COMMERCIAL BANK, THOMASVILLE, N.C.


The State Commercial Bank, Thomasville, N.C, withand North Carolina National Bank, Charlotte, N.C. (13761), which hadmerged Aug. 28, 1970, under charter and title of the latter bank (13761). Themerged bank at date of merger had

Total assets

$17,827,1851,284,569,745

1,302,645,825

Banking offices

Inoperation

395

To beoperated

98


On May 11, 1970, The State Commercial Bank,Thomasville, N.C, and North Carolina NationalBank, Charlotte, N.C, applied to the Office of theComptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

North Carolina National Bank, Charlotte, N.C,with IPC deposits of $850.4 million, was organizedin 1933, and now operates 91 offices in 27 commu-nities of North Carolina. This bank is the principalcomponent of NCNB Corporation, a one-bank hold-ing company, which, through several other subsidi-aries, engages in various bank-related activities suchas mortgage financing and servicing, insuranceagency services, factoring, and sales financing. Thecharter bank's position as the leading bank inCharlotte, the State's largest city, which has a popu-lation of over 200,000 and is the financial distribu-tion center for both North and South Carolina,and its strength in the Piedmont region of NorthCarolina, where the bulk of the State's industry islocated, give this bank a statewide influence, andmake its service area essentially the whole State.

The State Commercial Bank, Thomasville, N.C,with IPC deposits of $13.4 million, was establishedin 1945. In addition to its main office, located inthe central business district of the city, it operates abranch in a shopping center just to the south ofthe city, and a small facility in the northeast sec-tion of the city. This bank has generally operatedin a conservative manner over the years, and is nowfacing a management succession problem owing tothe imminent retirement of the bank's chief execu-tive officer.

Thomasville, the home of the merging bank, hada population of about 15,000 in 1960, and is locatedabout 8 miles northeast of Charlotte. The economyof the area is industrial and is supported by furni-ture manufacturing and textiles. A few large indus-trial employers dominate the employment market,

including Thomasville Furniture Industries, Inc.,which is reported to employ between 3,000 and3,500; Carolina Seating Company, with several hun-dred employees; and Amazon Cotton Mills, Inc.,and Carolina Underwear Company, with about 500employees each.

Since the closest offices of the two banks areabout 5 miles apart, some competition betweenthem will be eliminated. However, competitionbetween the banks is limited due to the presenceof offices of three of the State's four largest banks.Future competition between the banks will not beeliminated, as it is doubtful whether the charterbank would attempt to branch de novo into theimmediate Thomasville area as it appears thatpresent and impending banking offices in that cityare adequate in numbers for that community.When the merger is approved, the charter bankwill be the second largest bank in the State, andits share of total statewide deposits will increase byan insubstantial amount. Banking competitionshould be improved in the Thomasville area byapproval of this application, because the charterbank is more capable of competing with the localbranch of the Wachovia Bank and Trust Com-pany N.A.

Approval of the merger will benefit the Thomas-ville community by introducing the broad range ofsophisticated banking services offered by the charterbank, including trust services, automated dataprocessing services, a business development depart-ment, sophisticated commercial lending and mort-gage financing services, consumer credit services,and a larger lending limit. In addition, approval ofthis application will provide management succes-sion to the merging bank.

Applying the statutory criteria, we find themerger to be in the public interest, and the applica-tion, therefore, is approved.

JULY 15, 1970.

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NCNB has no offices in Davidson County or incounties to the east, west, and south of it, althoughits four branches in High Point (Guilford County)are within a 12 mile radius of Thomasville, whereall of SCB's offices are located. An analysis ofNCNB's 21 offices in the Greensboro-Winston-Salem-High Point SMSA showed total deposits of$230 million, of which $1.7 million, or 0.8 percent,derived from Davidson County. This, in turn,amounted to about 1.5 percent of the total depositsof about $112.5 million held by Davidson Countybanks, or about 12 percent of SCB's total deposits.Since NCNB's High Point branches are its officesclosest to Thomasville, it is likely that a significantportion of NCNB's Davidson County deposits areheld by its High Point branches, and are likelyderived from the Thomasville area, that portionof Davidson County closest to High Point.

However, SCB derives about 95 percent of itstotal deposits from Davidson County, and onlyabout 0.1 percent of its total deposits from theGreensboro-Winston-Salem-High Point SMSA. Too,there are several banking alternatives in the areabetween Thomasville and the High Point branchesof NCNB.

Hence, the primary impact of the proposedmerger is not likely to be the elimination of therelatively little direct competition between SCBand NCNB.

As of June 29, 1968, six banks operated 12 officesin Davidson County. Their deposits and shares ofcountrywide totals are indicated by the followingchart:

DepositsBank (millions) Percent

First Union (Lexington) $31.2 33.8Lexington State Bank 24.4 26.5Wachovia (Thomasville) 16.9 18.3SCB 11.9 13.0Carolina Bank (Denton) 4.0 4.4Industrial Bank (Lexington) 3.6 4.0

Since 1968, Carolina Bank has been acquired bythe State's eighth largest bank, and Industrial Bankmerged into Security Bank of Salisbury. Addition-ally, the State's fourth and sixth largest banks havehad de novo branches approved for Davidson

County, one in Thomasville and two in Lexington,respectively.

In Thomasville, SCB controls over half the ap-proved city banking offices, and has experiencedsustained growth although it competes directlywith the largest bank in the State.

Since North Carolina law permits statewidebranch banking, NCNB could branch de novo intoDavidson County, an area which probably over-states the relevant market, or into Thomasville, anarea which understates the market. Moreover, inview of NCNB's strong position in closely adjacentareas to the north of Davidson County, and itsabsolute size, it should be regarded as a likelypotential entrant into those areas. Certainly theacquisition of SCB by a likely potential entrantwould entail the loss of some potential competition.

However, there are several other commercialbanks which should also be regarded as potentialentrants into Davidson County and into Thomas-ville, thus somewhat diminishing the adverse effectof the proposed acquisition on potential compe-tition.

Commercial banking in North Carolina is domi-nated by a few institutions. Four banks control over60 percent of deposits: Wachovia (20.5 percent),NCNB (16.8 percent), First Union (13.4 percent)and First-Citizens (9.4 percent). The five largestbanks control over 66 percent. These increases instatewide concentration are part of a continuinghistory. From 1957 to June, 1968, the share of totaldeposits of the five largest banks increased from 42percent to 66 percent, a 24 percent increase—thehighest of any State during this period. This changehas been the result primarily of mergers, as shownby the fact that the number of bank competitorshas decreased steadily from 178 in June, 1961 toonly 116 in June, 1969.

Although the proposed acquisition is unlikely toeliminate substantial direct competition betweenthe applicants, it will foreclose the potential forgreater competition between them and continue thetrend of acquisitions by the statewide leaders.Hence, we conclude that the proposed acquisitionwill have an adverse effect upon potential compe-tition.

125


THE FIRST NATIONAL BANK OF ALLENTOWN, ALLENTOWN, PA., AND SAUGON VALLEY TRUST COMPANY, HELLERTOWN, PA.


Saucon Valley Trust Co., Hellertown, Pa., withand The First National Bank of Allentown, Allentown, Pa. (373), which had. .. .merged Aug. 28, 1970, under charter and title of the latter bank (373). Themerged bank at date of merger had

Total assets

$16,691,247260,658,654

277,349,902

Banking offices

Inoperation

19

To beoperated

10


On February 12, 1970, Saucon Valley Trust Com-pany, Hellertown, Pa., and The First National Bankof Allentown, Allentown, Pa., applied to the Comp-troller of the Currency for permission to mergeunder the charter and with the title of the latter.

The First National Bank of Allentown, withIPC deposits of $197.8 million, operates eightbranches and primarily serves Lehigh County andthe southeastern section of Northampton County.The bank has been involved in two acquisitions inthe past 5 years, the last having taken place in June,1964, when it merged with the Macungie Bank.

Saucon Valley Trust Company, chartered underthe laws of the Commonwealth of Pennsylvania,holds IPC deposits of $12.2 million, and operatesas a unit bank. It has not been involved in anyamalgamations or acquisitions since commencingoperations in 1920. Located 10 miles southeast ofthe charter bank, in Hellertown, it serves the ex-treme southern tip of Northampton County, theextreme eastern tip of Lehigh County, and a smallportion of northwest Bucks County.

Both banks are situated in Pennsylvania's LehighValley, one of the most progressive and economi-cally stable areas of the eastern seaboard. As a resultof its favorable location, climate, and topography,the region has attracted an abundance of industryand has developed coincidentally a need for largerlocal financial institutions to meet the growinglocal financial needs. Recognizing the need foradditional services, the large Philadelphia bankshave actively sought both commercial and trustbusiness in the area in recent years. In addition,Girard Trust Bank of Philadelphia, a $1.9 billioninstitution, operates a branch at Riegelsville, 12miles east of merging bank.

Competition in the Allentown-Bethlehem-LehighValley area is intense. The Merchants NationalBank of Allentown, with deposits of $149 million,

is in direct competition with charter bank and oper-ates 12 branches within the limits of LehighCounty. The Industrial Valley Bank and TrustCompany, the eighth largest bank in the Philadel-phia region, with deposits of $391 million, is thelargest bank in the relevant market area of theproposed merger, having gained entry into Allen-town in December 1968, when it merged with the$74 million Lehigh Valley Trust Company of Allen-town. It now operates six branches in this area.The Bank of Pennsylvania in Reading, with de-posits of $192 million, merged with the NationalBank of Topton, and thereby acquired three officesnear Allentown. It has since opened a regionaloffice in the city of Allentown and has obtainedapproval for another in-city branch. Two banksbased in Bethlehem, The First Valley Bank ofBethlehem, with deposits of $118 million, and the$87 million Union Bank and Trust Company ofEastern Pennsylvania, operate, respectively, nineand four branches in the area, and both have officesin central Allentown.

Additional competition affecting the area alsoemanates from New Jersey and New York City.Under New Jersey's new banking laws, the 93banks in the northern district are now empoweredto establish branch offices or merge with banks inan area from Jersey City, in the most eastern partof the State, to Phillipsburg on the western bound-ary. This region borders Pennsylvania and theeastern end of the Lehigh Valley area, only 18miles from the head office of charter bank. Intensecompetition can be expected as these New Jerseybanks locate offices adjacent to the eastern borderof this market. Moreover, only 68 miles east of theNorthampton County, Pa., line, is New York Cityand its large metropolitan banks, with which anumber of business and industrial concerns in theLehigh Valley area bank because of the lack of sizeand financial resources of local institutions.

126


The proposed merger will enhance Hellertown'scompetitive climate. Although there are at presentno competing banks in Hellertown, the First ValleyBank of Bethlehem is constructing a branch there,and upon its completion, the resulting bank willbe in direct competition with a very aggressive in-stitution with deposits of $118 million. Presentedwith that competition and that from larger banksin the neighboring areas and the big cities, themerging bank will find its prospects for futuregrowth limited, particularly in light of its manage-ment succession problem. The proposed mergerwill bring to customers of Saucon Valley Trust theresources of a larger bank offering broader services,and, the inevitable result will be more intensecompetition in the Hellertown area. With largerbanking resources available, local companies willfeel more inclined to maintain local banking con-nections rather than allow the large city banks topreempt much of that business.

This proposal will promote the public interestwithout lessening competition. The application is,therefore, approved.

JUNE 16, 1970.


Saucon Bank is located about 6 miles from thenearest offices of First National. The city of Bethle-hem, with numerous banking offices, lies betweenHellertown and Allentown. Although the applica-tion states that First National does not draw sub-stantial business from Saucon Bank's immediatearea, its position as the Allentown area's leadingbank indicates that some amount of existing com-petition will be eliminated by the proposed merger.

An appropriate market in which to judge the

competitive effects of the proposed merger includesLehigh County, the city of Bethlehem (parts ofwhich are in Lehigh and Northampton counties),and the township of Lower Saucon, which includesHellertown. First National, the larger of the twobanks headquartered in Allentown, has about 30percent of the total deposits in this area. The acqui-sition of Saucon Bank would increase this share byapproximately 2 percent. Its major competitor, theMerchants National Bank of Allentown has re-cently submitted an application to acquire theFogelsville National Bank, which would increaseits deposit share from about 20 percent to 22 per-cent.

The two large Bethlehem-based banks, whicheach have an office in Allentown, have depositshares of about 16 percent and 12 percent, bringingthe present four-bank concentration ratio to 78percent. Another 10 percent of the total depositsare held by the Industrial Valley Bank, Jenkin-town, Pa., which acquired the Lehigh Valley TrustCompany in 1968.

Further competition in the Allentown area isnow provided by new Allentown branches of theBank of Pennsylvania, Reading. Some future com-petition may be anticipated from the large Phila-delphia banks which have moved their headquar-ters to Montgomery County from whence branch-ing into Lehigh County (but not NorthamptonCounty) is permitted.

The proposed merger will increase concentrationand eliminate Saucon Bank as an independent com-petitor in an area where extensive economic growthis anticipated. Accordingly, we conclude that theproposed merger will have an adverse effect oncompetition.

EASTON NATIONAL BANK AND TRUST COMPANY, EASTON, PA., AND THE CITIZENS BANK OF WIND GAP, WIND GAP, PA.


The Citizens Bank of Wind Gap, Wind Gap, Pa., withand Easton National Bank and Trust Company, Easton, Pa. (1233), which had. .merged Aug. 31, 1970, under charter and title of the latter bank (1233). Themerged bank at date of merger had

Total assets

$7,835,98491,385,965

99,221,949

Banking offices

Inoperation

15

To beoperated

6

127



On March 31, 1970, The Citizens Bank of WindGap, Wind Gap, Pa., and Easton National Bankand Trust Company, Easton, Pa., applied to theComptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

Easton National Bank and Trust Company, withIPC deposits of $74 million, was organized as TheEaston Bank in 1814, and assumed its present titlein 1959, after a merger with Easton Trust Company.Through its branch system of five offices, includingone approved but unopened branch, the bankserves Northampton County and portions of Bucks,Carbon, Lehigh, and Monroe counties, in Pennsyl-vania, and Hunterdon and Warren counties, inNew Jersey.

The Citizens Bank of Wind Gap, with IPC de-posits of $6 million, is a unit bank serving north-central Northampton County and south-centralMonroe County. Since its organization in 1915, ithas not been involved in any mergers, consolida-tions, or acquisitions of assets.

Both banks are located in or near Pennsylvania'sLehigh Valley, one of the most progressive andstable areas in Pennsylvania, which has an economythat draws support from industrial, agricultural,and recreational activity. Large metropolitan areabanks, most notably the Philadelphia banks, haveentered this area either through merger or de novobranching; thus the $1.6 billion Girard TrustBank, Philadelphia, Pa., operates a branch 8 milessouth of Easton, at Riegelsville, while IndustrialValley Bank and Trust Company, Jenkintown, Pa.,the State's 13th largest bank, with $377 million indeposits, entered the market area in December 1968,through its merger with Lehigh Valley Trust Com-pany of Allentown. More recently, the Bank ofPennsylvania, Reading, Pa., established itself inAllentown through de novo branches. The intensecompetition that has developed among those banks,and others native to Allentown and Bethlehem,has had a significant effect upon the competitivepicture in Easton, where potential customers havebeen exposed to extensive advertising campaignsand personal solicitations from outside banks. Ex-cellent transportation facilities in the Lehigh Valleyhave accelerated the economic integration of thethree cities and have contributed to the intensebanking competition in the area.

Additional competition also emanates from New

Jersey and New York City. Under New Jerseys'new banking laws, the 93 banks in the northerndistrict are now empowered to establish branchoffices, or to merge with banks, in an area fromJersey City, in the most eastern part of the State,to Phillipsburg, on the western boundary. Thisregion borders Pennsylvania and the eastern endof the Lehigh Valley area, only 18 miles from thehead office of the charter bank. Intense competitionmay be expected as those New Jersey banks locateoffices adjacent to the eastern border of the area.Moreover, only 68 miles east of the NorthamptonCounty, Pa., line lies New York City and its largemetropolitan banks, with which a number of busi-ness and industrial concerns in the Lehigh Valleyarea maintain banking connections because of thelack of size and financial resources of local institu-tions.

While the participating banks' service areas over-lap to some extent, there does not appear to be 3significant degree of competition between them,due to the presence of alternative sources of bankingservices, and the generally unaggressive quality ofcompetition offered by the merging bank. The near-est alternate sources of banking services to themerging bank are located 3 miles to the east inPen Argyl where The Pen Argyl National Bank,with deposits of $11 million, and The First NationalBank of Pen Argyl, with deposits of $5 millionmaintain their headquarters. One mile further tothe east are offices of the $20 million First NationalBank of Bangor and the $17 million MerchantsNational Bank of Bangor. About 10 miles to thenorth, in Stroudsburg, are the Monroe SecurityBank and Trust Company, with deposits of $31million, and The First Stroudsburg National Bank,with $29 million in deposits. Altogether, there areoffices of eight banks, with deposits ranging from$5 million to $35 million, within 10 miles of themerging bank.

The merger of the two banks will benefit thecustomers of the merging bank. Upon consumma-tion of the merger, the resulting bank will offer newbanking services such as trust and estate planning,investment counseling, credit card programs, anda more sophisticated lending department offeringinstamatic check-credit programs. Automation willprovide customers with faster reporting and morefrequent account statements. In addition, the mer-ger will provide management succession to themerging bank.

128


Applying the statutory criteria, we find that theproposed merger is in the public interest. The ap-plication, therefore, is approved.

JUNE 24, 1970.


The closest offices of the two banks are about 10miles apart; one banking office intervenes directly.It would appear that the merger will eliminate alimited amount of direct competition between thetwo banks.

Easton Bank has received approval to open an

office in Forks Township, about 7 miles south ofWind Gap. No banking offices would intervenedirectly between this office and Wind Gap Bank.Thus, the merger would eliminate the potential forincreasing competition between the banks in north-eastern Northampton County. Because of the rela-tively small size of Wind Gap Bank, however, aswell as the existence of other Northampton Countybanks of substantial size which could branch intothis part of the county, the effect of the mergerupon potential competition would not be substan-tially adverse.

NATIONAL BANK AND TRUST COMPANY, CHARLOTTESVILLE, V A . , AND THE NATIONAL BANK OF ORANGE, ORANGE, V A .


The National Bank of Orange, Orange, Va. (5438), withand National Bank and Trust Company, Charlottesville, Va. (10618), which had. .merged Aug. 31, 1970, under charter and title of the latter bank (10618). Themerged bank at date of merger had

Total assets

$16,090,627102,033,911

124,566,561

Banking offices

Inoperation

416

To beoperated

20


On April 17, 1970, The National Bank ofOrange, Orange, Va., and National Bank and TrustCompany, Charlottesville, Va., applied to the Officeof the Comptroller of the Currency for permissionto merge under the charter and with the title of thelatter.

National Bank and Trust Company, Charlottes-ville, Va., with IPC deposits of $78.8 million, wasorganized in 1914. It now operates six offices inCharlottesville, and offices in 10 widely scatteredcommunities in five counties in central Virginia.The charter bank, although a regional institution,derives the preponderance of its deposits from theCharlottesville and Albemarle County areas.

Charlottesville, home office city of the charterbank and the site of six of its branches, is locatednear the geographic center of Albemarle Countyin central Virginia. The bank's Charlottesville-Albemarle County service area had an estimatedJuly 1966 population of 74,900. The chief economicsupport for this area derives from the presence ofthe University of Virginia, which had a 1969-70enrollment of over 9,000, and various related enter-prises. Tourism also provides significant support tothe local economy, with Monticello, the home of

Thomas Jefferson, a major attraction. Manufactur-ing activities and farming, especially livestock rais-ing, are also important sources of employment inthe area in which the bank operates.

Within its service area, the charter bank facesactive competition from 14 other banks, includingthe State's three largest. In the Charlottesville area,where the charter bank derives most of its business,three competing banks operate 12 offices, of whichthe Virginia National Bank, Norfolk, Va., theState's largest bank, operates six. Additional com-petition derives from other financial institutions,including two savings and loan associations, insur-ance companies, credit unions, sales finance com-panies, personal loan companies, and direct lendingagencies of the Federal Government.

The National Bank of Orange, Orange, Va., withIPC deposits of $13.7 million, was organized in1892. Besides its main office in Orange, it operatesa branch in the local shopping center and hasapplied for approval to establish branches in Gor-donsville and in the vicinity of Locust Grove, bothin Orange County. The merging bank's limitedtraining program makes it difficult to provide formanagement succession, and to maintain the levelof specialization necessary for some services.

19Q


The merging bank serves the town of Orangeand surrounding portions of Orange County.Orange County lies adjacent to Albemarle Countyand has an estimated population of 13,453, up from12,900 in 1960. The town of Orange is the largestincorporated community in Orange County, andhas a population of approximately 3,000. Agricul-ture has historically been the underlying economicsupport of the county, with the raising of beefcattle, horses, and dairy products the chief sourcesof income. In recent years, some light industry hasmoved in to add economic diversification to thecounty. More recently, farming has been giving wayto substantial recreational and residential realestate development, particularly in the eastern por-tion of the county. Germanna Community College,also in the eastern portion of the county, is sched-uled to open in September 1970, with an initialstudent enrollment of 600, and a faculty and staffof 200.

The business of the merging bank has been con-fined primarily to Orange County. Expansion hasbeen inhibited by its rather limited lending baseand the keen competition from the Orange andGordonsville branches of the Virginia NationalBank, coupled with strong competitive pressuresexerted by the larger banks at Fredericksburg andCulpepper. The merging bank is fifth largest of theeight banks operating in its service area.

This merger will benefit the Orange County areaby introducing a stronger bank more capable ofoffering a wider range of sophisticated services, withdepth in management, in substitution for thesmaller, less capable merging bank. The largerlending limit and broad experience of the resultingbank's management will be a distinct advantage tothe Orange and Orange County area.

Competition will not be adversely effected. Sincethe nearest offices of the two banks are 16 milesapart, and their service areas do not overlap, thereis no significant competition between them.Although the proposed merger would eliminateThe National Bank of Orange, there would be nodiminution in banking choices available to thepublic and no undue concentration of bankingassets would result. The charter bank's share ofdeposits in the State will increase only slightly from0.8 percent to 1.0 percent, while in its presentservice area its competitive ability will not be ap-preciably affected. Future competition will not be

affected as Virginia State branching restrictionsprohibit the charter bank from branching intoOrange County, and prohibit the merging bankfrom branching beyond the borders of OrangeCounty.

Applying the statutory criteria, it is concludedthat the proposed merger is in the public interest.The application, therefore, is approved.

JULY 6, 1970.


The closest branch of NBT is 16 miles from abranch (or proposed branch) of Orange Bank. Theonly other bank in Orange County is Virginia Na-tional Bank, with deposits in its Orange Countybranches of about $16 million. There would appearto be a limited amount of direct competition be-tween Orange Bank and NBT's office in Madison,located about 16 miles northwest of Orange. Theproposed merger would eliminate this existingcompetition as well as potential competition whichcould develop between Orange Bank's proposedGordonsville branch and NBT's Charlottesvilleoffices—the distance between them being about 18miles.

State law does not permit branching beyond thecounty in which the bank is located. A bank canestablish branches elsewhere by merger with bankslocated in other counties. While NBT has brancheslocated throughout the region, it could enterOrange County only by merger, or by becoming aholding company and chartering a bank in OrangeCounty. Orange County has only moderate growth,however, and there are several other potentialentrants in this manner.

Although two of the State's largest banks operateoffices in this general section of Virginia, NBT hasa very strong position in the counties surroundingCharlottesville. If the proposed merger is approved,NBT and Virginia National Bank will be the onlycommercial bank alternatives in Greene, Madison,Orange, Louisa and Fluvanna counties, whichtogether separate the Charlottesville area from Cul-pepper and Fredericksburg to the northeast.

The proposed acquisition would eliminate alimited amount of existing competition as well assome potential for increased direct competition.For these reasons, the proposed merger may haveand adverse effect on competition.

130


MIDLAND NATIONAL BANK, MILWAUKEE, WIS., AND THE HOME BANK, MILWAUKEE, WIS.


Banking offices

Inoperation

To beoperated

The Home Bank, Milwaukee, Wis., withand Midland National Bank, Milwaukee, Wis. (15510), which hadmerged Sept. 1, 1970, under charter and title of the latter bank (15510). Themerged bank at date of merger had

$24,740,76078,826,911

100,572,816


On June 10, 1970, The Home Bank, Milwaukee,Wis., and Midland National Bank, Milwaukee,Wis., filed an application with the Comptroller ofthe Currency for permission to merge under thecharter and with the title of the latter.

The Home Bank, Milwaukee, Wis., was charteredby the State of Wisconsin in 1910. As of December31, 1969, The Home Bank had total deposits of $24million, which equals about 0.8 percent of the totaldeposits in the Milwaukee market area. Located inthe inner core area of Milwaukee, this bank issuffering from a continuing decline in deposits asan increasing number of its customers relocate toother sections of the city.

Midland National Bank, Milwaukee, Wis., wasorganized in May 1965. As of December 31, 1969,it had $66 million in total deposits, and rankedsixth, with 2.3 percent of the total deposits in theMilwaukee market area. Midland National Bank islocated in the downtown business district of Mil-waukee, 15 blocks south of The Home Bank.Although somewhat undercapitalized, it has de-ferred a capital increase program pending the out-come of this merger application.

Milwaukee is a large industrial center locatednear the geographic and population center of thecountry. The population of the metropolitan areais approximately 1.4 million. Manufacturing is themost important activity, with machinery and elec-trical machinery ranking first and second in employ-ment, while the food and beer industry ranks third.Milwaukee, located on the Great Lakes-St. Law-rence Seaway, serves 200 cities in 20 midwesternstates and two provinces of Canada.

There is no competition between the mergingbanks since they have been associated for severalyears by virtue of their common ownership.

Consummation of the merger will insubstantially

increase Midland National Bank's share of thetotal deposits in the Milwaukee market area, andwill move it from sixth to fifth position. The mergerwill strengthen Midland National Bank's capitalstructure and increase its lending limit, therebyputting it in a better position to serve the needs ofits customers and to compete with the larger banksin Milwaukee.

State law does not permit the present office ofThe Home Bank to be maintained as a branch ofthe merged bank. However, the approval of a Statecharter for the North Milwaukee State Bank, to belocated within the inner city, would appear to fillthe void created by the closing of the office of themerging bank, and provide banking services espe-cially attuned to the needs of the neighborhoodresidents.

Applying the statutory criteria, we find the pro-posal is in the public interest. The application is,therefore, approved.

JULY 22, 1970.


The two banks are located 15 blocks apart. Themerger will eliminate some direct competition be-tween the banks. An offsetting consideration is thatit is proposed to sell the premises of Home Bankto a new bank which is presently seeking a charter.This new bank will have predominantly blackownership and management, in keeping with thecharacter of the area in which Home's office islocated. The merger will not, therefore, necessarilyreduce the number of banks in Milwaukee.

Milwaukee banking is dominated by the "BigThree"—First Wisconsin, Marshall and Ilsley, andthe Marine Corporation—which hold 74 percent ofMilwaukee deposits. This merger would increaseMidland's deposits share from 2.3 percent to 3.1percent of Milwaukee deposits.

131


The proposed merger will eliminate some com-petition and increase concentration slightly, but itwill also facilitate the creation of a new bank which

may be better able to serve the area. Accordingly,we conclude that the proposed merger is not likelyto have substantial adverse effects on competition.

GARLTON NATIONAL BANK, CARLTON, MINN., AND THE FIRST NATIONAL BANK OF GARLTON, CARLTON, MINN.


The First National Bank of Garlton, Garlton, Minn. (6973), withwas purchased Sept. 9, 1970, by Garlton National Bank, Garlton, Minn. (15825),which hadAfter the purchase was effected, the receiving bank had

Total assets

$6,803,122

350,0006,614,372

Banking offices

Inoperation

1

1

To beoperated

1


An application was made to the Comptroller ofthe Currency for permission for the Carlton Na-tional Bank, Carlton, Minn., to purchase assets andassume the deposit liabilities of The First NationalBank of Carlton, Minn.


emergency exists and that this Office must act im-mediately to prevent the probable failure of TheFirst National Bank of Carlton and to protect itsdepositors, creditors, and shareholders.

Accordingly, the application is, hereby, approved.SEPTEMBER 8, 1970.

NOTE: Due to the emergency nature of the situation, areport on the competitive factors was not requested.

NATIONAL BANK OF SOUTH DAKOTA, SIOUX FALLS, S. DAK., AND SECURITY BANK, MADISON, S. DAK.


Security Bank, Madison, S. Dak., withand National Bank of South Dakota, Sioux Falls, S. Dak. (12881),merged Sept. 10, 1970, under charter and title of the latter bankmerged bank at date of merger had

which had. . .(12881). The

Total assets

$10191

202

,47?,741

,214

,960,613

,573

Banking offices

Inoperation

114

To beoperated

15


On June 17, 1970, the Security Bank, Madison,S. Dak., and the National Bank of South Dakota,Sioux Falls, S. Dak., applied to the Comptroller ofthe Currency for permission to merge under thecharter and with the title of the latter.

The National Bank of South Dakota, Sioux Falls,S. Dak., was organized in 1926, and in 1931 becamean affiliate of First Bank System, Inc., a registeredbank holding company with headquarters in Min-neapolis, Minn. This bank, with IPC deposits of$141.1 million and 14 branches at locationsthroughout the State, is the largest in South Dakota.

The Security Bank, Madison, S.Dak., was orga-nized in 1896, and operates from one office in Madi-son. It holds IPC deposits of $8.3 million. The rela-tively low lending limit of the merging bank hasrequired it to meet the borrowing needs of itslarger customers by selling participations. In gen-eral, the bank's customer services are relativelylimited. With the exception of the president, allofficers of the bank are beyond normal retirementage, and the bank must provide for successor man-agement.

The market area of the Security Bank is the townof Madison and surrounding Lake County, which

132


is almost completely agricultural. Madison, whichis the only town in Lake County with a populationin excess of 300, has a population estimated at 6,300,of whom 1,300 are students at a local State college.

The National Bank of South Dakota's nearestoffice to Madison is in Sioux Falls, 48 miles south-east of the merging bank. In addition, the charterbank's existing affiliates do not operate in the Madi-son area. There is, therefore, no competition be-tween the participating banks or between the merg-ing bank and the holding company affiliates of thecharter bank. Approval of this application will noteliminate potential competition since the charterbank is unable, under State law, to establish de novobranches in Madison, while the provisions of fed-eral banking law would not allow First Bank Sys-tems, Inc., to charter a new bank in this town.

Consummation of the merger will provide theLake County market area with another full-servicebank offering a broader range of services, includingcomputer services and expanded trust services, aswell as a larger lending capacity. In addition, themerging bank's management succession needs willbe supplied from the charter bank's managementtrainee pool. As a branch of the charter bank, theresulting bank will compete more effectively withthe Madison branch of the Northwestern NationalBank of Sioux Falls, a subsidiary of NorthwesternBancorporation, the Nation's fifth largest registeredbank holding company.

Applying the statutory criteria to the proposedmerger, we conclude that it will serve the publicinterest. The application is, therefore, approved.

AUGUST 11, 1970.


Madison is located 49 miles from the nearestoffice of the National Bank, which is also the near-est office of any subsidiary of First Bank Systems,Inc. The distance between the merging banks andthe presence of other banks in the intervening areaindicates that no substantial existing competitionwill be eliminated by the proposed merger.

National Bank is the largest bank in the State.It has the size and resources necessary to make denovo entry into any area of the State which itwishes to serve.

South Dakota State law would, however, pro-hibit National Bank from branching de novo intoMadison; but it could enter the area by branchinginto any of several towns in Lake County whichhave no banking offices. Given the size and poten-tial of the county, establishment of such offices isdoubtful.

In addition, this merger is a not insubstantialaddition to the dominant banking organization inthe State which will have the effect of making itmore difficult to create new banking organizationsable to compete throughout the State.

OLD NATIONAL BANK OF WASHINGTON, SPOKANE, WASH., AND NORTH WEST BANK, SEATTLE, WASH.


Banking offices

Inoperation

To beoperated

North West Bank, Seattle, Wash., withand Old National Bank of Washington, Spokane, Spokane, Wash. (4668), whichhadmerged Sept. 25, 1970, under charter and title of the latter bank (4668). Themerged bank at date of merger had

$15,998,718

316,064,001

332,062,719

2

40

42


On March 31, 1970, the Old National Bank ofWashington, Spokane, Wash., applied to the Officeof the Comptroller of the Currency for permissionto merge with North West Bank, Seattle, Wash.,under the charter and with the title of the former.

The Old National Bank of Washington was

organized in 1891. It now holds IPC deposits of$242.4 million, and operates 39 branches. Since thelate 1950's, the charter bank has been expandingthroughout eastern Washington, especially in theTri-Cities and Columbia Basin regions. In theState of Washington, such expansion can occur onlyby merger, as a bank may not open a de novo

133


branch outside its headquarters city or town intoa community where another bank already exists.Old National Bank has been operating exclusivelyin the eastern part of the State, but due to its ex-pansion it has been actively competing for a numberof years with statewide branch banking systemsheadquartered in Seattle.

The charter bank has its headquarters in Spo-kane, Wash., the second largest city in the State,which has a population of about 300,000. Spokaneis 288 miles east of Seattle, across the Cascade Moun-tain range in the generally arid part of the State.The economy of the eastern part of the State isbased principally on agriculture, although thereis some lumbering activity in the northeast sector.The Columbia Basin Irrigation Project has openedmany acres for farming in this half of the State,and continued progress in the extension of farmlandthrough irrigation is expected. Spokane is also con-sidered to be the heart of the Inland Empire, whichincludes eastern Washington, northern Idaho, andwestern Montana. Agriculture, lumbering activity,light manufacturing, mining, military installations,and retail and wholesale trade activity providediversification and stability to an economy whichhas good prospects.

North West Bank was organized in April 1963.During its first five years of operation, the bankexperienced substantial asset problems; however,operations have improved since 1968, under newmanagement. Because the bank's trade area is highlycompetitive, its growth has been slow. Deposits haveremained steady at $12 million since 1964. Its lend-ing limit of $273,000 is too small to service the needsof many local businesses, most of which operate ona national scale; consequently, it is primarily a re-tail bank. North West Bank opened its first branchin March 1970, also in the downtown area.

North West Bank, Seattle, Wash., is located inthe central retail and financial district of down-town Seattle, in the western part of the State. Theeconomy west of the Cascades is based on lumber-ing activity, forest products, the aerospace industry,manufacturing, retail, and international commerce.The population and economy of western Washing-ton has expanded rapidly during recent years, butpresent data indicate that the expansion haspeaked, and a moderate decline is expected in 1970.Sharp cutbacks at Boeing Company, and a depressedlumber market are primary causes for the decline.

As there is presently no competition between theapplicant banks, the proposed merger will not

diminish competition. A larger lending limit willenable the resulting bank to serve larger retailersin the Seattle area, and allow it to provide addi-tional banking services, including trust services,credit card services, international trade services, andautomobile dealer financing. The projected declineof the economy in western Washington will notaffect it when offset by the anticipated growth ofthe economy in the area of the charter bank.

Approval of the application will enable thecharter bank to compete more aggressively with thefour large statewide branch banking systems operat-ing out of Seattle and Tacoma, including theSeattle-First National Bank, Seattle, Wash., Na-tional Bank of Commerce of Seattle, Seattle, Wash.,Washington Mutual Savings Bank, Seattle, Wash.,Peoples National Bank of Washington, Seattle,Wash., and National Bank of Washington, Tacoma,Wash. The resulting bank will hold only 5.7 per-cent of the deposits and 5.3 percent of the loansin the State. Strong competition is felt throughoutthe State from savings and loan associations, financecompanies, personal loan companies, credit unions,government lending agencies, insurance companies,and factors.

Charter bank will be the first bank headquar-tered in eastern Washington to enter the bankingmarket of western Washington.

The expansion of the charter bank into a state-wide system will greatly enhance banking competi-tion. It is concluded that the proposal is in thepublic interest and meets the relevant statutorycriteria. The merger is, therefore, approved.

AUGUST 12, 1970.


The closest offices of the merging banks are 120miles apart. Consequently, it would not appear thatthe proposed merger would eliminate any signi-ficant direct competition between the participants.It would, however, bring about competition be-tween Old National, the State's fifth largest com-mercial bank, and the big Seattle-based bankswhich include Washington's three largest commer-cial banks (two of which have deposits in excessof a billion dollars).

Under Washington law, entry of another bankinto Seattle by de novo branching is prohibited. Abank not presently located in Seattle could enteronly by acquiring an existing bank in the area, orby affiliating with a holding company which couldthen charter a new bank there. Old National is

134


an affiliate of Washington Bancshares, which has Bank's very small share of the Seattle commercialthe resources and capability to charter a new bankin the Seattle area.

However, entry by such a de novo charteringwould be only slightly more procompetitive thanthis proposed acquisition, in view of North West

banking market.We conclude, therefore, that the proposed merger

is not likely to have an adverse effect on competi-tion.

THE PARK NATIONAL BANK OF NEWARK, NEWARK, OHIO, AND THE PEOPLES STATE BANK,GRANVILLE, OHIO


The Peoples State Bank, Granville, Ohio, withwas purchased Sept. 28, 1970, by The Park National Bank of Newark, Newark,Ohio (9179), which hadAfter the purchase was effected, the receiving bank had

Total assets

$11,856,469

75,858,81487,715,283

Banking offices

Inoperation

1

6

To beoperated

7


On January 14, 1970, The Park National Bankof Newark, Newark, Ohio, applied to this Office forpermission to purchase the assets and assume theliabilities of The Peoples State Bank, Granville,Ohio. Both banks are located in Licking Countywhich has a population of approximately 109,000and is situated near the geographical center ofOhio.

Newark, the home office city of charter bank, islocated in the south central portion of the countyand has a population estimated at 47,000. The buy-ing bank operates two branches in Newark andone each in Heath, Hebron, and Kirkersville.Charter bank has IPC deposits of $56 million.

The selling bank, The Peoples State Bank, is aunit bank located in Granville, 7 miles west ofNewark. Granville has a population of approxi-mately 3,500. The bank has IPC deposits of approx-imately $8.8 million, a lending limit of $55,000,and is the only bank in Granville.

In addition to the purchasing bank, Newark isserved by the $51 million First National Bank ofNewark, an affiliate of BancOhio Corporation, aregistered bank holding company located in Colum-bus, and by the $47 million Newark Trust Com-pany, which is owned by Citizens Financial Cor-poration, a conglomerate operating primarily in thefinancial field. There are five other unit banks inLicking County, one each in Alexandria, Croton,Johnstown, Pataskala, and Utica. Two small out-

of-county institutions, near Licking County's south-ern border in the small towns of Millersport andThornville, also serve the county.

Although commercial banking competition ismeasured largely on a county-wide basis in Ohio,the small banks mentioned in the previous para-graph compete in Licking County, and increasingcompetition from the large Columbus banks hasbeen noted. The acquisition will not affect thebanking structure in Newark to any significant ex-tent. It will, however, replace the relatively unag-gressive, locally-owned bank in Granville with abranch of the Newark-based aggressive and progres-sive charter bank. The two banks do not competeto any great extent; a study of the business drawnby buying bank in the Granville area indicates thatmost of this business is not sought out on a compe-titive basis. Since the population of Granville isonly 3,500, and it is served by the selling bank andwill be served by a branch of The First NationalBank of Newark, which has recently received per-mission to establish a branch in Granville, the num-ber of banking offices in relation to the populationindicates that Granville is more than adequatelybanked. This factor would prevent the buying bankfrom establishing a de novo branch in Granville.Therefore, potential competition between the appli-cant banks is not a factor in this proposal. Further-more, the lending services offered by both banks arecomplementary rather than competitive. The buy-ing bank lends heavily to commercial enterprises

135


and to consumers, while the selling bank has amajority of its lending portfolio in residential realestate loans and farm loans.

In evaluating the competitive effects of theproposal, competition from savings and loan asso-ciations must be considered. As of June 30, 1969,deposits in savings and loans in Newark were 43percent as large as commercial bank deposits. Ap-proximately 40 percent of real estate mortgageloans made in Licking County during 1968 weremade by savings and loan associations. Savings andloan associations are even more active in Columbus,which captures a degree of the Licking Countymarket. Another factor worthy of note is that, al-though the buying bank is the largest commercialbank in Licking County, it is the smallest inde-pendent commercial bank in the town of Newark.

The acquisition will benefit the citizens of Gran-ville in that modern, specialized services will beavailable. Computer services will be offered to thecustomers of the Granville bank, a bank credit cardwill be introduced, and trust services will becomeavailable. Furthermore, internal banking problemswill be modified. Bookkeeping will be automatedand the management successor deficiencies will beobviated.

In taking all of these factors into consideration,it appears that the proposal is in the public interestand it is, therefore, approved.

JULY 17, 1970.


The closest offices of the two banks are 7 milesapart, and Park National derives a not insubstan-tial amount of business from Granville, where thesole office of Peoples Bank is located.

Ohio law permits only county-wide branching,and commercial banking is highly concentrated inLicking County, where all the offices of the merg-ing banks are located. The three largest banks hold84 percent of county-wide total deposits. PeoplesBank holds the fourth largest share of county totaldeposits, with about 7 percent, and the fifth largestshare of IPC demand deposits, with about 5 per-cent of the county-wide totals. As a result of theproposed merger, Park National, the county's larg-est bank would increase its share of county-wideIPC demand deposits from 44 percent to 48 percent,and its total deposit share would increase from 39percent to 45 percent. Such increases in concentra-tion are particularly harmful in light of restrictiveState law in regard to branching.

The proposed merger will eliminate direct com-petition, increase concentration, and eliminate Peo-ples Bank as an independent competitor in an areawhere continued economic growth is expected. Ac-cordingly, we conclude that the proposed mergerwould have a significantly adverse effect on com-petition.

MARINE NATIONAL BANK, ERIE, PA., AND THE FIRST NATIONAL BANK OF EDINBORO,EDINBORO, PA.


The First National Bank of Edinboro, Edinboro, Pa. (7312), withand Marine National Bank, Erie, Pa. (870), which hadmerged Sept. 30, 1970, under charter and title of the latter bank (870). Themerged bank at date of merger had

Total assets

$10,464,946118,134,273

128,599,219

Banking offices

Inoperation

210

To beoperated

12


On June 17, 1970, The First National Bank ofEdinboro, Edinboro, Pa., and the Marine NationalBank, Erie, Pa., applied to the Comptroller of theCurrency for permission to merge under the charterand with the title of the latter.

The Marine National Bank, with IPC deposits of

$92 million, is headquartered in Erie, Pa., and pres-ently operates 11 branches in north-central andwestern Erie County and western Crawford County.In addition, the bank has three approved but un-opened branches, one of which will be situated inMeadville, Pa., where the charter bank recentlywas granted approval to relocate its head office.

136


The charter bank is an aggressive, well-managed,growing institution. Under new management since1964, the bank has more than doubled its total re-sources to the present level of $113 million.

The First National Bank of Edinboro, with IPCdeposits of $8 million, was organized in 1904, andoperates its head office in Edinboro, Pa., and abranch office in neighboring McKean, Pa. Themerging bank has one approved but unopenedbranch and is presently the only commercial banklocated in the immediate vicinity of Edinboro. TheNational Bank of North East, North East, Pa., re-cently was granted approval to establish a branchin Edinboro. Although the merging bank hasgrown during recent years, that growth has notbeen as spectacular as that of charter bank. Themarket area of the merging bank encompasses theborough of Edinboro and Washington Township.Edinboro is located 18 miles south of Erie, Pa., and25 miles north of Meadville, Pa.

Competition between the participating banks isnominal. Few customers of the charter bank resideor do business in the merging bank's service area.None of the customers of the merging bank trans-act business with the charter bank, except in caseswhere the merging bank has requested the charterbank to participate in overline loans. Approvalof this merger will not have the effect of foreclosingpotential competition as the merging bank lacksthe resources to penetrate the charter bank's marketarea, and because it appears doubtful that the areaserved by the merging bank could support de novobranch entry by the charter bank. After the mergeris consummated, the resulting bank will increaseits rank from fifth to fourth largest bank in the

combined Erie-Crawford County market area, andwill be a more effective competitor to the largerbanks.

The proposed merger will replace a small, un-aggressive, country bank with a larger institutionwhich will provide the customers of the mergingbank with a broader range of banking services.They will include a larger lending limit, lowerservice charges, trust services, bank credit card serv-ices, greater availability of funds for consumerlending, automation, and data processing services.

Applying the statutory criteria, we find themerger is in the public interest, and the applica-tion, therefore, is approved.

AUGUST 13, 1970.


The closest offices of the merging banks arelocated about 6 miles apart. According to the appli-cation, Marine National draws only a limited num-ber of accounts from the Edinboro market area.However, the proximity of Edinboro Bank'sMcKean office to Erie indicates that increasing com-petition between the banks is likely.

As of June 30, 1968, nine commercial banks op-erated 41 banking offices in Erie County. MarineNational, with 17.9 percent, held the third largestshare of total deposits held by such banks, whileEdinboro Bank held the eighth largest share, withabout 1.8 percent.

In view of the proximity of the merging banksand the increase in concentration of banking inErie County, we believe that the proposed mergermay have an adverse effect on competition.

OLD NATIONAL BANK OF WASHINGTON, SPOKANE, WASH., AND FIRST NATIONAL BANK IN TONASKET, TONASKET, WASH.


First National Bank in Tonasket, Tonasket, Wash. (14166), withwas purchased Sept. 30, 1970, by Old National Bank of Washington, Spokane,Spokane, Wash. (4668), which hadAfter the purchase was effected, the receiving bank had

Total assets

$9,455,004

295,570,266305,025,270

Banking offices

Inoperation

1

42

To beoperated

43

137



On September 25, 1970, application was madeto the Comptroller of the Currency for permissionfor the Old National Bank of Washington, Spo-kane, Spokane, Wash., to purchase assets and as-sume the deposit liabilities of the First NationalBank in Tonasket, Tonasket, Wash.


emergency exists and that this Office must actimmediately to prevent the probable failure of theFirst National Bank in Tonasket and to protectits depositors, creditors, and shareholders.

Accordingly, the Old National Bank of Wash-ington, Spokane, Wash., is authorized to proceedwith the purchase and assumption transaction.

SEPTEMBER 25, 1970.

NOTE: Due to the emergency nature of the situation, areport on the competitive factors was not requested.

ZIONS FIRST NATIONAL BANK, SALT LAKE CITY, UTAH, AND BOUNTIFUL STATE BANK,BOUNTIFUL, UTAH


Bountiful State Bank, Bountiful, Utah, withwas purchased Sept. 30, 1970, by Zions First National Bank, Salt Lake City, Utah(4341), which hadAfter the purchase was effected, the receiving bank had

Total assets

$12,860,037

272,307,425285,167,462

Banking offices

Inoperation

3

22

To beoperated

25


On May 28, 1970, Zions First National Bank,Salt Lake City, Utah, applied to the Office of theComptroller of the Currency for permission topurchase the assets and assume the liabilities ofBountiful State Bank, Bountiful, Utah.

Zions First National Bank, Salt Lake City, Utah,with IPC deposits of $184 million, was organized in1873. This bank, a subsidiary of Zions Utah Ban-corporation, concentrates its activities in the SaltLake City area. It also has offices in Spanish Fork,some 65 miles south of Salt Lake City; in HeberCity, 50 miles southeast; in Provo, approximately45 miles south; and in St. George, some 300 milessouth.

Salt Lake City, Utah, is the county seat of SaltLake County, and is the State's capital. With apopulation of almost 200,000, it ranks as Utah'slargest city. The Salt Lake City Metropolitan Area,including the southern part of Davis County, wherethe selling bank is located, is Utah's major popu-lation, commercial, and industrial area, and has apopulation of about 500,000. The economy of thearea is widely diversified, and includes mining,manufacturing, transportation, agriculture, com-merce, and military activity. Salt Lake City is thehome of the Mormon Church and the University

of Utah, which has an enrollment of 21,000. Nu-merous defense projects are located in Salt LakeCounty, and Hill Air Force Base, the largest em-ployer in the State, with 18,000 civilian employees,lies 25 miles to the south. In the immediate SaltLake City area, the largest employer is KennecottCopper Corporation, which employs about 7,000.Primary banking competition for the purchasingbank emanates from the $594.5 million First Secur-ity Bank of Utah, N.A., Salt Lake City, Utah, andthe $308.1 million Walker Bank and Trust Com-pany, Salt Lake City, Utah, the State's first andsecond largest banks.

Bountiful State Bank, Bountiful, Utah, with IPCdeposits of $10.6 million, was organized in 1906.It operates two branches, one at North Salt Lakeand one at Centerville.

The primary service area of the Bountiful StateBank is the southern part of Davis County, in-cluding the communities of Bountiful, West Bounti-ful, North Salt Lake, Centerville, Woods Cross,and, to some extent, Farmington, the county seat.The center of this area is approximately 10 milesnorth of the central business district of Salt LakeCity. In 1960, Bountiful had a population of 17,000,which has increased to 27,800, according to 1970preliminary census data. Davis County has grown

138


by 34,000 people since 1960, when its populationwas 64,780. The Bountiful area is a "bedroom"community for persons employed in Salt Lake Cityand the manufacturing concerns in or near thearea. Hill Air Force Base, which, as previouslymentioned, is the State's largest employer, domi-nates the county's economy. Manufacturing activityhas superseded agriculture and trade to becomethe county's second most important industry. Oilrefineries in the area employ 1,300 persons. Theprincipal competitors of the Bountiful State Bankare the Farmers State Bank, Woods Cross, Utah,with deposits of $12.7 million, and the South DavisSecurity Bank, Bountiful, Utah, with deposits of$6.6 million. In addition to the other banks oper-ating in Davis County, competition derives fromoffices of savings and loan associations, industrialloan corporations, small loan companies, and creditunions.

This purchase and assumption transaction willbenefit the Bountiful area by introducing serviceshitherto unavailable, including trust services andcomplete electronic data processing services. Thepurchasing bank will be better able to serve thecredit needs of the Bountiful community with itslarger lending limit and broader experience in alltypes of lending activity, as well as through thewider variety of banking services it offers.

Competition will not be adversely affected byconsummation of this transaction. Although theBountiful State Bank is located in the broader SaltLake City Metropolitan Area, the participatingbanks' nearest offices are 10 miles apart, and thereis little present competition between them. Thepurchasing bank will remain the third largest bankin the State and its proportionate share of depositswill increase only slightly. It will be in a slightlystronger competitive position with respect to the

State's two largest banks, which are considerablylarger than it. Potential competition will not beaffected since the purchasing bank is unable, underState law, to branch de novo into Davis County,where the selling bank's service area is located.

It is concluded in the light of the statutorycriteria, that the proposal is in the public interest.The application is, therefore, approved.

AUGUST 27, 1970.


This merger involves one of the three largestbanking organizations in Utah, and one of thelargest banks in southern Davis County. Accordingto the application, the home offices of the banks are12 miles apart. However, North Salt Lake, site of aBSB branch, is less than 5 miles northwest of SaltLake City, where Zions home office is located. Theonly banking alternative between Bountiful andSalt Lake City is a branch of the Bank of AmericanFork.

BSB derives a limited amount of deposits fromSalt Like City. Zions derives "deposits on the orderof 2 percent of those held by banks situated in theBountiful area." Given that most residents ofBountiful work in Salt Lake City, the two banksprovide clear alternatives to each other.

Hence, if the proposed merger is approved, someexisting competition will be eliminated. In addi-tion, the merger would eliminate the possibilityof increased competition with BSB which Zionswould cause by entering any of the communities insouthern Davis County which are open to branch-ing (i.e., any town without a bank headquarteredin it).

For these reasons, we conclude that the proposedmerger would have an adverse effect on bankingcompetition.

NATIONAL BANK OF NORTH AMERICA, N E W YORK, N.Y., AND FIRST NATIONAL BANKIN YONKERS, YONKERS, N .Y .


First National Bank in Yonkers, Yonkers, N.Y. (13882), withand National Bank of North America, New York, N.Y. (7703), which hadconsolidated Oct. 13, 1970, under charter and title of the latter bank (7703). Theconsolidated bank at date of consolidation had

Total assets

$140,426,7941,998,427,915

2,138,854,709

Banking offices

Inoperation

11102

To beoperated

113

139



On June 21, 1970, First National Bank in Yonk-ers, Yonkers, N.Y., and National Bank of NorthAmerica, New York, N.Y., filed an application withthe Comptroller of the Currency for permission toconsolidate under the charter and title of the latter.

National Bank of North America, New York,N.Y., was organized in 1905 as the First NationalBank of Freeport, and became the Meadow BrookNational Bank in 1949. In 1967, the Meadow BrookNational Bank was consolidated with the Bank ofNorth America under the charter of the formerand with its present title. The National Bank ofNorth America operates 99 offices in the city ofNew York and the counties of Nassau and Suffolk.Although it has IPC deposits of $1,166 million, andranks 10th among the 96 commercial banks in thearea, it is a medium size bank in its market area.

First National Bank in Yonkers, Yonkers, N.Y.,was organized in 1933. As of December 31, 1969, ithad IPC deposits of $120 million, and ranked 52ndamong the 96 commercial banks in the area. Thebank operates 10 branches, all within the city ofYonkers. This bank is undercapitalized, and has amanagement succession problem. The three topofficers are in their seventies. All attempts to findyounger men who are qualified to succeed the pres-ent management have failed. In 1964, it attemptedto affiliate with the Chemical Bank New YorkTrust Company, New York, N.Y. In 1969, it at-tempted to affiliate with a statewide holding com-pany. Both attempts were rejected by the super-visory authorities on grounds not present in theproposed consolidation.

The New York City Metropolitan Area, con-sisting of the five boroughs of New York City andthe counties of Nassau, Suffolk, and Westchester, isthe leading financial center in the United States.Six of the 10 largest banks in the country arelocated in the area, as are the principal offices of allmajor insurance companies and investment bank-ing and brokerage houses. In addition, many of theNation's major manufacturing companies are head-quartered in the area. The population of the areais approximately 11.5 million people.

Yonkers, with a population of 227,000 people, islocated in the southwest corner of WestchesterCounty, just north of the New York City line. Itcontains many manufacturing concerns, and is animportant retail center for the Bronx and for West-chester County.

Consummation of the consolidation will increasecompetition in the New York City area in general,and in Yonkers in particular. It will increase Na-tional Bank of North America's share of the totaldeposits of the New York City area only slightly,from 1.80 percent to 1.94 percent.

New York State's "home office protection" lawprevents any bank except First National Bank inYonkers from opening an office in Yonkers untilFirst National Bank in Yonkers becomes affiliatedwith a bank outside the city of Yonkers. The pro-posed consolidation would remove this barrier andallow other banks to open branches in Yonkers. Anumber of New York banks have made branch ap-plications in anticipation of the approval of thisconsolidation application.

The possibility of potential competition betweenthe subject banks appears to be slight. First Na-tional Bank in Yonkers could legally establishbranches in New York City, but its capital andmanagement limitations make this impractical.Because the city of Yonkers is presently closed tode novo branches, and because those possiblebranch locations close enough to the city of Yonk-ers to provide competition to First National Bankin Yonkers have been preempted by other banks,there appears little likelihood of potential competi-tion being created through branching by NationalBank of North America.

There is only a minimal amount of competitionbetween the two banks. Their nearest offices are 7miles apart, with numerous banking facilities lo-cated between them. C.I.T. Financial Corporation,of which National Bank of North America is a sub-sidiary, operates one small office in WestchesterCounty, approximately 7 miles from the nearestbranch of the First National Bank in Yonkers.

The combined bank will better serve the needsof the public in Yonkers. More commercial, indus-trial, and home improvement loans, all of whichare especially important in an urban area, will beavailable. The increased lending limit will allowthe combined bank to better serve the loan needsof the area. The established international depart-ment of National Bank of North America will beable to offer a full line of services to the businessesin Yonkers. National Bank of North America hasa history of working to solve the problems in theurban areas it serves. It has helped to develop andattract new businesses, made loans to minoritygroup businessmen, and financed low and middle

140


income housing, all services which the Yonkers areaneeds. The consolidation will also resolve the capi-tal problem of the Yonkers Bank, as well as itsmanagement succession problems.

Applying the statutory criteria, we find the pro-posal is in the public interest. The application is,therefore, approved.

SEPTEMBER 9, 1970.


National Bank of North America has no officesin either the city of Yonkers or in WestchesterCounty; its closest office to an office of First Yonkersis in the southern Bronx, 7 miles distant. Severalcompeting commercial banks operate offices in theintervening area. National Bank of North Americamay be considered a banking alternative forYonkers-Westchester residents who commute toNew York City. However, according to the applica-tion, the New York City offices of National Bankof North America do limited banking business withYonkers-Westchester banking customers. In likemanner, Trade Bank and Trust Company, whoseclosest offices to Yonkers are in midtown Manhat-tan, holds relatively few Yonkers-Westchester ac-counts. According to supplemental informationprovided by the applicants, other subsidiaries of

C.I.T. Financial Corp. do not do substantial busi-ness in the service area of First Yonkers.

It would appear that the proposed consolidationwould eliminate no more than a limited amount ofdirect competition.

Under New York law, National Bank of NorthAmerica could be permitted to open de novobranch offices in Westchester County, but not inany community wherein is located the head office ofany commercial bank not affiliated with a registeredbank holding company. Accordingly, the homeoffice of First Yonkers itself prevents National Bankof North America (or any other commercial bank)from branching in Yonkers. However, NationalBank of North America has the resources to enterother sections of Westchester County de novo, ashave other major New York City banks, and indeedis one of the largest eligible banks not yet operatingin the county.

The consolidation of First Yonkers and NationalBank of North America will open Yonkers to denovo branching by banks headquartered in NewYork City as well as any banks in New York'sThird Banking District. According to the applica-tion, a number of eligible banks are formulatingplans to enter Yonkers in this manner if the pro-posed consolidation is approved.

FIRST NATIONAL BANK OF SOUTH JERSEY, EGG HARBOR TOWNSHIP, N.J., AND THE FIRST NATIONALBANK OF PEDRICKTOWN, PEDRICKTOWN, N J .


The First National Bank of Pedricktown, Pedricktown, NJ. (8007),and First National Bank of South Jersey, Egg Harbor Township,which hadmerged Oct. 30, 1970, under charter and title of the latter bankmerged bank at date of merger had

withNJ. (1326),

(1326). The

Total assets

$6,273,493

285,013,575

291,287,068

Banking offices

Inoperation

2

25

To beoperated

27


On July 20, 1970, The First National Bank ofPedricktown, Pedricktown, N.J., and the FirstNational Bank of South Jersey, Egg Harbor Town-ship, N.J., applied to the Comptroller of the Cur-rency for permission to merge under the charterand with the title of the latter.

The First National Bank of South Jersey, EggHarbor Township, N.J., was organized in 1822,and now holds IPC deposits of $207.8 million. The

bank operates 17 offices in Atlantic County, fourin Gloucester County, one in Salem County, andanother is approved but as yet unopened in SalemCounty.

The First National Bank of Pedricktown, Ped-ricktown, N.J., was organized in 1905, and nowholds IPC deposits of $4.5 million. The bank'shome office is in Salem County and it operates onebranch in Gloucester County. In general, the merg-ing bank's customer services are relatively limited,

141


The merging bank's $4.8 million in total depositsrepresents 5.4 percent of Salem County's aggregatedeposits, and ranks the bank eighth in size amongthe 10 commercial banks in Salem County.

Pedricktown, N.J., is a rural, unincorporatedtown, with a population of 2,280, near the Dela-ware River, east of Wilmington, Del., and south ofPhiladelphia, Pa. The market area of the mergingbank is gradually shifting from being predomi-nantly agricultural into a manufacturing and resi-dential economy. However, the bank's small lend-ing limit of $55,000, and its lack of depth in man-agement inhibit the bank from doing any substan-tial promotion of sizeable commercial banking busi-ness.

Banking competition in the Third Banking Dis-trict, which is made up of five south-central NewJersey counties, will not be adversely affected bythe proposed merger. The First National Bank ofSouth Jersey, with total assets of $258.9 million, isthe third largest bank in the Third Banking Dis-trict. The two banks larger than the charter bankeach possess assets exceeding the charter bank's byapproximately $100 million. Competition betweenthe proponents is slight, as their home offices are60 miles apart, and their nearest offices are 12 milesapart. No potential competition between the par-ticipants will be eliminated as the merging bank'slimited resources would be likely to preclude itsexpansion into the charter bank's market area, andthe charter bank cannot branch de novo into themerging bank's market area as there is a "homeoffice" protection provision in New Jersey law.Consummation of the proposed merger will not re-

duce the number of banking alternatives availableto the public, but will substitute for the mergingbank a full-service bank with a broad range ofservices, as well as the management depth andfinancial resources to serve commercial customers.

Applying the statutory criteria to the proposedmerger, we conclude that it will serve the publicinterest. The application is, therefore, approved.

SEPTEMBER 28, 1970.


First National's closest office to an office of Ped-ricktown Bank is located about 10 miles away, withseveral other banks in the intervening area. Itwould appear that the proposed merger would noteliminate significant existing competition betweenthe two banks.

Pedricktown Bank serves primarily northwesternSalem County and western Gloucester County inthe Third Banking District; accordingly, First Na-tional could be permitted to open de novo officesin these counties except in communities that areserved by a head office of a bank or, where thepopulation is under 7,500, by a branch office ofa bank. Pedricktown and Logan Township areboth closed to de novo branching, but other com-munities in these counties are open to First Na-tional.

Pedricktown Bank holds about 5.9 percent oftotal deposits held by commercial banks in SalemCounty. In view of the size and relative marketposition of Pedricktown Bank, we do not believethat the proposed merger would have a significantlyadverse effect on potential competition.

General Bankand Hartfordwhich had . . .merged Oct.merged bank

HARTFORD NATIONAL BANK AND TRUST COMPANY, HARTFORD, CON INTRUST COMPANY, N E W HAVEN, CONN.


and Trust Company, New Haven, Conn., withNational Bank and Trust Company, Hartford, Conn. (1338),

30, 1970, under charter and title of the latter bank (1338). Theat date of merger had

1

1

., AND GENERAL

Total assets

$8,076,269

,041,105,191

,048,981,460

BANK AND

Banking offices

Inoperation

4

54

To beoperated

58


On June 25, 1970, General Bank and Trust Com-pany, New Haven, Conn., and Hartford NationalBank and Trust Company, Hartford, Conn., ap-

plied to the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of the latter.

The charter bank, with deposits of $821 million,

142


is the second largest bank in Connecticut. It wasorginally organized in 1792, and presently operates50 branch offices that serve seven of the State's eightcounties.

The merging bank, with IPC deposits of $7 mil-lion, is the smallest bank in New Haven. It wasoriginally organized in 1928, and presently operatesone branch office in Hamden. The bank is facedwith a management succession problem. Directbanking competition is provided by four of thelargest banks in the State: the Connecticut Bankand Trust Company of Hartford, with deposits of$830 million; the Union Trust Company of NewHaven, with deposits of $445 million; The FirstNew Haven National Bank, with deposits of $234million; and the Second National Bank of NewHaven, with deposits of $160 million.

New Haven, with a population of about 141,000,is situated on Long Island Sound, approximately45 miles south of Hartford. Not only is it the lead-ing retail center in south-central Connecticut, butit is also an important seaport, and the home ofYale University. While the city of New Haven hassuffered a decline in population, the outlying areascontinue to expand. The city's mixture of employ-ment opportunities, which includes manufacturing,retail, and service industries, more than justifieshealthy economic projections. Hamden, with apopulation of about 48,000, is situated 5 milesnorth of New Haven. That area has experiencedrapid growth in recent years due to accelerated in-terest in suburban living.

There is no significant competition presently ex-isting between the two banks which will be elimi-nated by consummation of the proposed merger.Their closest offices are about 20 road miles distantfrom each other; the charter bank has no offices inNew Haven County. Since Connecticut law doesnot permit de novo branching into townshipswhere there is already located the home office ofanother bank, both New Haven and Hamden areclosed to de novo entry by the charter bank. Theaddition of $7 million in deposits to the charterbank will not have any significant effect on theoverall banking structure. On the other hand, con-summation of this merger will solve the manage-ment problem at the merging bank, and will pro-vide a bank which will be more able to compete

with the large New Haven-Hamden banks, andwill be better able to meet the needs of those com-munities.

Applying the statutory criteria, we find that thisproposal is in the public interest and the applica-tion is, therefore, approved.

SEPTEMBER 21, 1970.


All the offices of General Bank are located insouthern New Haven County. Hartford Bank hasno New Haven County offices, and its closest officeto an office of General Bank is at Westfield, some20 miles distant. Several banks operate offices inthis intervening area, and it appears from the ap-plication that neither of the merging banks obtainsappreciable business from the areas immediatelyserved by the other. Under these circumstances,significant direct competition probably does notexist between them.

Connecticut law does not permit a commercialbank to establish de novo branch offices in a town-ship where there is already located the home officeof another commercial bank. Under this law, bothNew Haven and Hamden are closed to de novoentry by Hartford Bank. Most of the townshipssurrounding New Haven and Hamden are similarlyclosed, but Hartford Bank could establish de novooffices in East and West Haven (adjoining NewHaven to the south) and in Cheshire and Bethany(adjoining Hamden to the north). As Connecticut'slargest commercial bank, Hartford National has theresources and capabilities for such de novo expan-sion. Indeed, it has shown a disposition in the pastto enlarge its operations via de novo expansion.Since 1964, it has opened 12 such branches, andhas approval for opening four more.

The proposed merger is essentially a marketextension merger through which Hartford Bankproposes to enter the New Haven banking marketby acquisition of the smallest by far of the" fivebanks operating in New Haven. This type of entrywill inject a strong new competitive force in NewHaven, capable of challenging the local leaders inthis concentrated market. Under these circum-stances, we do not believe that this merger willhave any significantly adverse effect upon poten-tial competition.

143


THE WARREN NATIONAL BANK, WARREN, PA., AND THE GOLD STANDARD NATIONAL BANK OFMARIENVILLE, MARIENVILLE, PA.


The Gold Standard National Bank of Marienville, Marienville, Pa. (5727), with..was purchased Oct. 30, 1970, by The Warren National Bank, Warren, Pa. (4879),which hadAfter the purchase was effected, the receiving bank had

Total assets

$3,077,259

103,434,682106,511,941

Banking offices

Inoperation

1

9

To beoperated

10


On July 7, 1970, The Warren National Bank,Warren, Pa., applied to the Office of the Comp-troller of the Currency for permission to purchasethe assets and assume the liabilities of The GoldStandard National Bank of Marienville, Marien-ville, Pa.

The Warren National Bank, the purchasingbank, with IPC deposits of $51 million, was or-ganized in 1893. In addition to its head office, sit-uated in Warren, it operates nine branches. It hasan approved but unopened office in North Warren.

The service area of the buying bank encom-passes all of Warren County, western ForestCounty, southwestern McKean County, and north-western Elk County, and has a population of70,000. The borough of Warren, with a popula-tion of 14,505, is the county seat of Warren County,and dominates the area. A large portion of thissection of northwestern Pennsylvania forms theAllegheny National Forest. The remaining landarea is devoted primarily to agriculture. Industryis important to this section, but is confined to thewidely separated larger communities and their en-virons.

Other commercial banks with offices in the buy-ing bank's service area include Pennsylvania Bank& Trust Co., the only other bank in Warren, with13 offices and total deposits of $106.2 million; theHamlin Bank & Trust Co., with four offices andtotal deposits of $15.5 million; the Elk CountyBank & Trust Co., with four offices and totaldeposits of $33.8 million; the Ridgway NationalBank, a unit bank, with total deposits of $8 mil-lion; the Farmers & Merchants Bank, St. Marys,with total deposits of $8.2 million; the BradfordNational Bank, with three offices and total depositsof $35.2 million; the Producers Bank & Trust Co.,Bradford, with three offices and total deposits of

$17.4 million; the First National Bank of Fryburg,with total deposits of $6.3 million; the First SenecaBank 8c Trust Co., with 14 offices, one of which liesin the charter bank's service area, and total depositsof $109.2 million; and the Northwest PennsylvaniaBank & Trust Co., with 17 offices, one of which liesin the charter bank's service area, and total depositsof $129.3 million.

The Gold Standard National Bank of Marienville,the selling bank, with IPC deposits of $2.6 million,is a single office institution which began operatingin 1901. This is a small, static, and unaggressivebank. This bank has not been able to reach outinto other areas via de novo branching because oflimited capital funds available for fixed asset invest-ment and because of lack of qualified management.For years it has been experiencing difficulty ingenerating sufficient deposits to meet the demandfor loans.

Marienville, home of the single office sellingbank, is 33 miles south of Warren, in ForestCounty. The service area of the selling bank isconsidered to be southern Forest County, south-eastern Elk County, and northeastern ClarionCounty. Forest County is the most sparsely popu-lated county in Pennsylvania, with only 4,500 in-habitants. Of this number, 1,300 reside in Marien-ville. The Allegheny National Forest practicallysurrounds Marienville, and abounds with the re-sources for hunting and fishing. Of 266,340 acres inForest County, 153,000 are owned by the State andFederal governments, and are used to produce lum-ber and wood products. Manufacturing accountsfor 85 percent of those employed in Forest County,of which 18.9 percent are employed in the forestindustries. A glass container plant is the principalindustry in Marienville.

No banking competition exists in Marienville asthe selling bank is the only bank located in its

144


service area. The 20-mile distance over the ruggedforest terrain of Allegheny National Forest whichseparates the nearest offices of the purchasing bankand the selling bank precludes any competitionbetween them. Some competition comes from theClarion offices of the First Seneca Bank and TrustCo. of Oil City, 27 miles southwest, and the North-west Pennsylvania Bank and Trust Co.

The purchase will have an insignificant effect inthe market area of the charter bank. This trans-action will, however, benefit the Marienville com-munity substantially, by replacing a small, static,and unaggressive bank with an office of a large,growing institution which will be able to providethe banking public in and around Marienville withmodern, efficient banking services, funds for loansat more competitive rates, and higher rates ondeposit money. Among the new services to beoffered are trust services, which are presently un-available to the citizens of the Marienville area.The purchasing bank will be in a better positionto adequately handle reasonable loan requests, andthereby encourage growth and added prosperity tothe economy of the selling bank's service area.

Applying the statutory criteria, it is concluded

that the proposal is in the public interest. Theapplication is, therefore, approved.

SEPTEMBER 22, 1970.


The closest office of Warren Bank to GoldStandard Bank is its branch at Tionesta, in westernForest County. Tionesta is 23 miles from Marien-ville, and the intervening area is sparsely popu-lated. According to the application, distance andpoor roadways result in neither bank drawingsubstantial deposits or loans from the area servedby the other. Thus, the proposed transaction wouldnot seem to eliminate significant existing compe-tition between the two banks.

Pennsylvania law allows unlimited branchinginto contiguous counties. Although Warren Bankcould, therefore, open de novo offices anywhere inForest County, the limited economic base, com-bined with the lack of growth by Gold StandardBank, indicates that Warren Bank is not a likelypotential competitor by de novo branching.

Accordingly, we conclude that this transactionwill not have a significantly adverse effect oncompetition.

THE CITIZENS NATIONAL BANK, BRYAN, OHIO, AND THE PIONEER BANKING COMPANY, PIONEER, OHIO


The Pioneer Banking Company, Pioneer, Ohio, withand The Citizens National Bank, Bryan, Ohio (13740), which hadmerged Nov. 6, 1970, under charter and title of the latter bank (13740). Themerged bank at date of merger had

Total assets

$5,459,26128,962,951

34,383,265

Banking offices

Inoperation

13

To beoperated

4


On July 31, 1970, The Pioneer Banking Com-pany, Pioneer, Ohio, and The Citizens NationalBank, Bryan, Ohio, applied to the Comptroller ofthe Currency for permission to merge under thecharter and with the title of the latter.

The Citizens National Bank, the charter bank,with IPC deposits of $7.2 million, was organizedin 1933. It presently operates two branches, one inBryan and one in West Unity. This bank is gen-erally in good condition, but management, thoughcompetent, is without depth. It does not offer trustservices but anticipates applying for trust powers.

The Pioneer Banking Company, the mergingbank, with IPC deposits of $1.1 million, waschartered in 1913, and operates no branches. Itis in satisfactory condition but offers no trust serv-ices. This bank has poor physical quarters and pro-poses to construct a new banking house. Manage-ment is also competent but lacking in depth orbreadth. Its small loan limit has kept it fromrendering adequate service to the community.

Bryan, Ohio, population 8,000, is the countyseat of Williams County and is located in its south-central portion. Pioneer, Ohio, has a populationof 900, and is located 16 miles due north of Bryan

145


in the extreme north-central portion of the county.West Unity is 11 miles northeast of Bryan and 12miles southeast of Pioneer. The combined servicearea of both banks includes all of William County,the northern parts of Defiance County, the westernarea of Fulton County, and the southern sections ofHillsdale County, Mich.

The economy of Williams County, which hasa population of 33,000, is representative of the en-tire service area, and is largely dependent uponindustrial and agricultural pursuits. In Bryan, thecounty's only city, and in several of the biggertowns and villages throughout the area, there area significant number of industries, some of whichhave substantial payrolls and employ sizeable num-bers of persons.

There are eight commercial banks operating atotal of 11 banking offices in Williams County. Anumber of other commercial banks are located nearthe Williams County line in contiguous Defi-ance and Fulton counties, in Ohio, and HillsdaleCounty, in Michigan. In the combined service areathere are 18 banking offices, 14 of which are oper-ated by competing banks. Because all of the creditneeds of the larger business, commercial, or indus-trial firms of the area are not met by local banks,the substantially larger banks in Toledo, Columbus,Cleveland, Fort Wayne, and Chicago that servethose needs can also be said to be operating in thearea.

Consummation of this merger will create an insti-tution more capable of adequately serving thecredit needs of some of the area's larger firms thanany existing institution in the area. The resultingbank will have managerial capability in greaterdepth than either merging bank. The resultingbank will be in a better position than the merginginstitution to provide the capital to build theneeded new banking house in Pioneer. The serv-ices of the agricultural consultant employed by thecharter bank will be made available in the Pioneerarea. A data processing department is being placedin operation at the charter bank, and its facilitieswill be available to the merging bank's customers.

Competition will not be adversely affected. Be-cause of the distance separating the merging banks'offices, there is little competition between them.The resulting bank will continue the charter bank'sranking as largest county bank, but its size will notbe increased significantly. The merger should stim-

ulate competition by recapturing part of the localbusiness now lost to the large out-of-area, big-citybanks. All other banks will continue to share in thearea's economic growth and retain their propor-tionate shares of local banking business.

Applying the statutory criteria, it is concludedthe proposed merger is in the public interest. Theapplication is, therefore, approved.

OCTOBER 5, 1970.


The proposal would merge the largest andseventh largest of the eight commercial banks inWilliams County, Ohio. The fifth largest has justbeen acquired by the applicant. Thus, approvalof the proposed merger would mean that, withinthe period of around a year, the number of inde-pendent banks would be reduced from nine toseven.

The main offices of the participating banks areabout 16 miles apart, and applicant's newly ac-quired West Unity branch is about 12 miles fromPioneer.

The resulting banks would hold about 37.5 per-cent of Williams County deposits, and the largestfour commercial banks would hold about 82.5 per-cent of these deposits. There was, and perhaps is,strong potential competition, as evidenced by anout-of-county bank holding company offering topurchase controlling interest in Pioneer.

The application notes that the merger wouldconstitute a de jure recognition of the presentlyexisting de facto "combination of the financial andmanagerial resources" of the two banks. We do notview prior direct or indirect stock acquisitions witha view toward merger, or the subsequent relation-ships which may thereby develop, as facts whichdemonstrate that a proposed merger will have noanticompetitive effects. Such a merger will per-manently eliminate the potential for increasedcompetition should the various stock control ar-rangements be terminated at some time in thefuture.

Because the merger would increase concentrationand result in the elimination of Pioneer as a con-duit for the introduction of potential competitioninto the market, it is our view that the proposedtransaction will have an adverse effect upon com-petition.

146


WELLS FARGO BANK, N.A., SAN FRANCISCO, CALIF., AND THE FIRST NATIONAL BANK OF HOLTVILLE,HOLTVILLE, CALIF.


Banking offices

Inoperation

To beoperated

The First National Bank of Holtville, Holtville, Calif. (9770), withand Wells Fargo Bank, National Association, San Francisco, Calif. (15660),which hadmerged Nov. 6, 1970, under charter and title of the latter bank (15660). Themerged bank at date of merger had

$13,927,142

5,514,746,846

5,527,924,917

1

281

282


On June 25, 1970, The First National Bank ofHoltville, Holtville, Calif., and Wells Fargo Bank,N.A., San Francisco, Calif., applied to the Comp-troller of the Currency for permission to mergeunder the charter and with the title of the latter.

The charter bank, with IPC deposits of $3.8billion, was orginally organized in 1852, and ispresently the third largest bank in the State. Mostof the bank's 272 branch offices are located innorthern California. Only recently, the bank ex-panded its activities to the southern part of theState and presently operates 26 branch offices insouthern California.

The merging bank, with IPC deposits of $11.5million, was organized in 1907, and is a single-officeinstitution. Due to the limited services it is ableto offer, the bank does not adequately serve theneeds of its community. Although it cannot be saidthat the bank has a management problem, still ithas never had a management development pro-gram, and must rely entirely on its president anddirectors. Commercial banking competition to themerging bank is provided by the four other banksin Imperial County, which operate a total of 15offices. They include Bank of America, N.T. & S.A.,with six offices in the county; Security Pacific Na-tional Bank and United California Bank, withthree offices each; and Imperial Valley NationalBank, with two offices. Competition is also pro-vided by one savings and loan association, fourfinance companies, local offices of two insurancecompanies, a local federal land bank association,and a local production credit association.

Holtville, with an estimated population of 4,000,is located about 12 miles to the east of El Centro,the county seat and commercial center of ImperialCounty. The economy of this area, like the rest ofthe county, is predominately dependent on agricul-

ture. The Holtville area contributed approximately95 percent of the carrot production of ImperialCounty in 1969. Annual crop yields, coupled withlivestock feeding, have made Imperial County thefourth highest agricultural producer in the Nation.The major crops include lettuce, cotton, alfalfa,sugar beets, and cantaloupes. Heavy industry ispractically nonexistent in Imperial County. Severallight manufacturing firms have operations in thearea, including the Holly Sugar Corporation, theValley Nitrogen Producers, Inc., and G. T. Schjel-dahl Company, which is located in Holtville.

Because of the distance separating the participat-ing banks, there is no competition presently exist-ing between them. The closest office of the charterbank to the merging bank is located in San Diego,about 137 miles to the west of Holtville. Becauseof the difference in size between the participatingbanks, consummation of the proposed transactionwill not eliminate potential competition betweenthem. Moreover, a de novo branch of the charterbank in the Holtville area would serve to aggra-vate the problems at the merging bank. The addi-tion of $11.5 million in deposits to the charter bankwill have no significant effect on concentration ofbanking resources in the State. On the other hand,consummation of this merger will introduce intothe Holtville area a bank more able to competewith the large banks operating in that area andbetter able to meet the needs and convenience ofthe banking public in that area.

Applying the statutory criteria, we find that themerger is in the public interest, and the applica-tion, therefore, is approved.

SEPTEMBER 29, 1970.


Wells Fargo has no offices in the Holtville area;its nearest branch is in San Diego, 137 miles westof Holtville and numerous banking facilities sepa-

147


rate the two. Consequently, the proposed merger other areas of southern California. However, therewould not eliminate any direct competition be-tween the banks.

Wells Fargo is the largest bank in Californianot serving the Imperial Valley. It could makede novo entry into that area as it is doing into

would appear to be a number of other large bankscapable of entering this area; therefore, the elimi-nation of Wells Fargo as a potential de novoentrant should not have a significantly adversecompetitive effect.

FIRST UNION NATIONAL BANK OF NORTH CAROLINA, CHARLOTTE, N.C.MARSHALL, N.C.


The Bank of French Broad, Marshall, N.C, withand First Union National Bank of North Carolina, Charlotte, N.C. (15650), whichhadmerged Nov. 14, 1970, under charter and title of the latter bank (15650). Themerged bank at date of merger had

, AND THE BANK

1

1

Total

$8

,04?

,051

assets

,906,330

875,218

781,548

OF FRENCH BROAD,

Banking offices

Inoperation

2

141

To beoperated

143


On July 29, 1970, The Bank of French Broad,Marshall, N.C, and First Union National Bank ofNorth Carolina, Charlotte, N.C, filed an applica-tion with the Comptroller of the Currency forpermission to merge under the charter and withthe title of the latter.

The First Union National Bank is headquarteredin Charlotte, the financial and distribution centerof the State, Located in the south-central Piedmontsection of North Carolina, Charlotte is one of theState leaders in manufacturing, and boasts thehighest retail sales totals in the two Carolinas. It isone of the fastest growing cities in the southeasternUnited States.

First Union National Bank, with IPC deposits of$684 million, is the third largest bank in the State,and presently operates 137 banking offices in 66communities in North Carolina. Principal bankingcompetition for this bank is provided by the $1.6billion Wachovia Bank and Trust Company, oper-ating 130 offices in 51 communities; the $1.3 billionNorth Carolina National Bank, operating 91 officesin 27 communities; and the $665 million First-Citizens Bank and Trust Company, operating 130offices in 57 communities. Competition to thecharter bank is also provided by such strong re-gional banking systems as the $486 million TheNorthwestern Bank and the $247 million BranchBanking and Trust Company. Numerous other

financial institutions also operate in the same areasand compete with the charter bank.

The merging bank, The Bank of French Broad,is headquartered in Marshall, Madison County, andpresently operates a branch office in Weaverville, inbordering Buncombe County. The economy ofMadison County is primarily supported by agricul-ture, with tobacco the main cash crop. The popula-tion is scattered and rapidly declining due towidespread unemployment; approximately 60 per-cent of the residents live on small farms. The per-sonal income levels, housing conditions, medianvalue of homes, and average value of farmland areconsiderably below the State norm. The creation ofan environment conducive to growth and attrac-tive to new business is of primary importance tothe economic future of the area.

The Bank of French Broad, with IPC deposits of$7 million, was originally organized in 1903. Thebank is faced with a management succession prob-lem. Because of its limited experience and re-sources, it is doubtful that this bank can do muchin the future to stimulate growth in its service area.The only other bank directly competing in thearea of the merging bank is the Citizens Bank inMarshall, with deposits of $8.5 million.

There is no significant competition presentlyexisting between the participating banks. Theclosest office of the charter bank to the mergingbank is in Ashville, Buncombe County, and is


approximately 12 miles from Weaverville. Theelimination of whatever competition now existsbetween these banks can readily be outweighed bythe benefits to follow. Although First Union Na-tional Bank could, under State law, branch de novointo the area of the merging bank, the small popu-lation and limited economic potential of the areado not warrant de novo entry.

Consummation of the proposed merger betweenFirst Union National Bank and The Bank of FrenchBroad, in addition to solving the problems at themerging bank, will introduce a more viable institu-tion in the service area of the merging bank. Theresulting bank will not only provide a full rangeof banking services and a larger lending limit, butwill also offer access to the capital resources thatwill be needed to assist future economic growth inthe area.

Applying the statutory criteria, we find the pro-posal is in the public interest. The application,therefore, is approved.

OCTOBER 9, 1970.


First Union operates six offices in BuncombeCounty, five of which are in or very near Asheville.The Weaverville office of French Broad Bank islocated about 12 miles north of Asheville, andabout 8 miles north of the nearest First Unionoffice. No other banking offices intervene, and thetwo areas are connected by good roads. Thus, thereappears to be some existing competition betweenthe two banks. The application indicates thatFrench Broad Bank derives most of its BuncombeCounty business from the Weaverville area andpoints north, while First Union derives most of itsbusiness from the Asheville area and points south.

The amount of business which First Union derivesfrom the Weaverville area is not insubstantial,however, especially when compared to the totalbusiness held by the Weaverville office of FrenchBroad Bank.

French Broad Bank operates its head office inMadison County. Citizens Bank (total deposits of$8.5 million) is the only other bank operating inthe county, with offices in Mars Hill, Marshall, andHot Springs. French Broad Bank holds around34 percent of total county deposits. Although FirstUnion is one of many potential entrants intoMadison County, including all of the largest banksin North Carolina, the depressed state of the econ-omy in Madison County, the decline in population,and the poor prospects for growth make de novoentry by any of the potential entrants, includingFirst Union, unlikely.

There are presently six commercial banks operat-ing in Buncombe County. As of June 30, 1968, FirstUnion held approximately 24.1 percent of the totaldeposits held by all Buncombe County bankingoffices, while French Broad Bank held approxi-mately 1.3 percent. The bank holding the largestshare of Buncombe County deposits was WachoviaBank & Trust Co., N.A., Charlotte (also the largestbank in the State, holding total deposits of $1,330.6million on December 31, 1969), which held approxi-mately 47.7 percent of toial Buncombe Countydeposits. Thus, the merger would increase FirstUnion's share of these deposits from 24.1 percent to25.4 percent, and would increase the share held bythe two largest banks in the county from 71.8 per-cent to 73.1 percent. Thus, the merger would causea slight increase in the already high concentrationin commercial banking in Buncombe County.

We conclude that the proposed merger wouldhave an adverse effect on competition.

VIRGINIA NATIONAL BANK, NORFOLK, V A . , AND CARROLL COUNTY BANK, HILLSVILLE, V A .


Banking offices

Inoperation

To beoperated

Carroll County Bank, Hillsville, Va., withand Virginia National Bank, Norfolk, Va. (9885), which hadmerged Nov. 23, 1970, under charter and title of the latter bank (9885). Themerged bank at date of merger had

$14,747,9391,036,189,871

1,050,427,829

1104

105

149



On August 18, 1970, Carroll County Bank, Hills-ville, Va., and Virginia National Bank, Norfolk,Va., applied to the Comptroller of the Currencyfor permission to merger under the charter andwith the title of the latter.

Virginia National Bank, with IPC deposits of$733 million, maintains 103 branches and twofacilities scattered throughout Virginia. Althoughthe charter bank is essentially a statewide bankinginstitution, it draws approximately two-thirds of itsdeposits from the Tidewater-Charlottesville area.The applicant presently has no office within theservice area of the merging bank.

Carroll County Bank, with IPC deposits of $11million, was founded in 1890, and operates a singleoffice in Hillsville, the county seat of CarrollCounty. The estimated population of the mergingbank's service area, composed of Hillsville and thesurrounding area, is 5,000 persons. Geographicaland economic conditions in the region havehindered the bank in attracting qualified man-agerial personnel, and the bank's operations arealmost wholly dependent upon the president, forwhom no successor is immediately apparent.

Virginia National Bank is, to some degree, incompetition with every major bank in the south-eastern portion of the United States, for certainservices. Principal competitors in Virginia are the$1.2 billion United Virginia Bankshares, Incorpo-rated, a registered bank holding company, that con-trols 10 affiliated banks with 98 offices in 32 com-munities in Virginia; the $785 million First &Merchants National Bank, with 57 offices in 18communities in Virginia; the 12 banks affiliatedwith Virginia Commonwealth Bankshares, the totalresources of which amount to $679 million; the$555 million Dominion Bankshares Corporation,with six affiliated banks operating 53 offices in Vir-ginia; the 11 banks affiliated with the First VirginiaBankshares Corporation, with 102 offices and re-sources of $507 million; and nine banks affiliatedwith Financial General Corporation, operating 40offices in Virginia with total resources of $390 mil-lion. Further competition is provided by the smallerFidelity-American Bankshares, Incorporated, which,at present, controls only two banks with 34 officesand combined resources of $283 million.

The principal competitors of the Carroll CountyBank are the First National Bank in Galax, with

two offices and total resources of $20 million, andthe Merchants and Farmers Bank in Galax, withthree offices and total resources of $16 million. Thecharter bank's closest offices to the merging bankare located in Pulaski, Va., approximately 26 milesnorth, and in Wytheville, approximately 30 milesnorthwest of Hillsville. Because each of the par-ticipating banks is prohibited by State statute frombranching de novo into the trade area of the other,and because no direct competition exists at thepresent, this proposal will have no adverse effectupon any existing or potential competition.

Upon consummation of the merger, the resultingbank will be able to offer a wide variety of special-ized banking services not heretofore available toresidents and businesses of Carroll County. Suchservices include computer services, mortgage financ-ing, a bond department, farm service department,educational loans, and trust services.

It is concluded that the merger will have no ad-verse competitive effect and is in the public interest.The application is, therefore, approved.

OCTOBER 22, 1970.


County Bank is the only bank located in CarrollCounty, although there are two commercial banksin Galax, an independent city 12 miles southwestof Hillsville. Virginia National Bank, which isheadquartered in Norfolk, 250 miles east of CarrollCounty, has its nearest offices at Pulaski, in PulaskiCounty, 23 miles north of Hillsville, and at Wythe-ville, in Wythe County, 31 miles northwest of Hills-ville. According to the application, these officesdraw small fractions of 1 percent of their businessfrom Carroll County, and County Bank draws evensmaller proportions of its business from Pulaski orWythe counties. Thus, it would appear that onlyan insignificant amount of direct competitionwould be eliminated by the proposed merger.

Under Virginia law no bank in the State, includ-ing Virginia National Bank, is permitted to branchde novo into Hillsville. Virginia National Bank,however, could enter through establishment of aholding company and the acquisition of a newlychartered bank in the area. A community of 1,100persons in a community with a declining popula-tion would not, however, appear to be a likelyprospect for the introduction of a second commer-cial bank. The proposed merger would not appearto have an adverse effect on competition.

150


T H E RIDDELL NATIONAL BANK OF BRAZIL, BRAZIL, IND., AND T H E FIRST NATIONAL BANK OF CENTERPOINT, CENTER POINT, IND.


The First National Bank of Center Point, Center Point, Ind. (9250), withand The Riddell National Bank of Brazil, Brazil, Ind. (5267), which hadmerged Dec. 1, 1970, under charter of the latter bank (5267) and title "The Rid-dell National Bank of Brazil, Indiana." The merged bank at date of merger had. .

Total assets

$3,055,39722,782,237

25,428,913

Banking offices

Inoperation

11

To beoperated

2


On May 28, 1970, The First National Bank ofCenter Point, Center Point, Ind., and The RiddellNational Bank of Brazil, Brazil, Ind., applied to theOffice of the Comptroller of the Currency for per-mission to merge under the charter of the latter andwith the title "The Riddell National Bank ofBrazil, Indiana."

The Riddell National Bank of Brazil, Brazil,Ind., with IPC deposits of $17.2 million, was orga-nized in 1885, and remains a unit bank. It servesBrazil, Ind., which has a population of 9,000 andis the county seat of Clay County. Brazil is about55 miles southwest of Indianapolis and 20 mileseast of Terre Haute, in the northern part of ClayCounty. Eight industrial plants located in Brazilemploy about 1,100, and many other residentscommute to nearby Terre Haute, Ind., and othercities, for employment.

The First National Bank of Center Point, CenterPoint, Ind., with IPC deposits of $2.4 million, wasorganized on October 6, 1908. This unit bank isa small, unaggressive institution with an inadequatelending limit. It has been unable to provide formanagement succession.

Center Point, Ind., is located near the centerof Clay County, about 12 miles southeast of Brazil.It has an estimated population of 300. The econ-omy of this area is agricultural. The merging bankis the only bank in the town.

Both banks are located in Clay County, whichhas an estimated population of 24,000, and is lo-cated in the west-central part of Indiana. Althoughagriculture is the principal source of economicsupport in the county, there are also, within thecounty, coal producing strip mines, and 12 com-mercial and manufacturing firms. Five of thosecompanies manufacture clay products, and threeare directly associated with farming. However,about 70 percent of the county's labor force is

employed in Terre Haute, Indianapolis, Green-castle, Bloomington, and other neighboring cities.

Two other banks are located in Clay County.They are the First Bank and Trust Company ofClay County, Brazil, Ind., which operates its mainoffice and a drive-in branch in Brazil, and anotherbranch at Clay City, in the southern part of thecounty, and which has total deposits of $22.2 mil-lion; and The Poland State Bank, Poland, Ind.,which is in the extreme eastern part of the county,and which has deposits of $1.5 million.

In the applicant's trade area there are 16 banksoperating 36 offices. Of those, the charter bankranks eighth in size. Among its principal competi-tors are the Terre Haute First National Bank, thelargest bank in the area, which has total deposits ofalmost $97 million; The Merchants National Bankof Terre Haute, with total deposits of $58.3 mil-lion; and the Indiana State Bank of Terre Haute,with total deposits of almost $39 million. There arealso eight savings and loan associations in the serv-ice area which together have total resources of$89 million as well as numerous sales finance andpersonal loan companies. In addition, it is esti-mated that the Federal Land Bank has $2 millionin loans outstanding to farmers in Clay County.

Consummation of this merger will solve a seriousmanagement problem in the merging bank. Thecustomers of the merging bank will benefit fromhigher lending limits, increased interest on timedeposits, trust facilities, improved services, and theassurance of a continuing banking outlet in theircommunity which the merger will provide.

Applying the statutory criteria, we find themerger to be in the public interest, and the appli-cation, therefore, is approved.

SEPTEMBER 18, 1970


The participating banks are located 12 milesapart. There are no banks in the intervening area.

151


Thus, it would appear that some direct competitionbetween the banks would be eliminated by the pro-posed merger. Furthermore, under Indiana law,which permits county-wide branching, Riddell Bankcould establish a branch in Center Point and, thus,compete more directly with First National.

Riddell Bank and First National are, respec-tively, the second and third largest banks in ClayCounty. First National's share of the total depositsin this county, 41 percent, will increase some 6 per-cent, as a result of the merger. The resulting bank

will still be the second largest in the county. Eventhough banks located outside the county offer somecompetition in various areas, State law does notallow them to branch into the county.

The proposed merger would eliminate some di-rect competition between the participants and itwould reduce the number of banks able to competewithin the county to three. Thus, we concludethat this merger is likely to have an adverse effecton competition.

FIRST NATIONAL STATE BANK OF N E W JERSEY, NEWARK, N.J., AND ORANGE VALLEY BANK, ORANGE, N.J.


Orange Valley Bank, Orange, N.J., with .and First National State Bank of New Jersey, Newark, N.J. (1452), which had. . .merged Dec. 4, 1970, under charter and title of the latter bank (1452). The mergedbank at date of merger h a d . . . .

Total

$7,861,

866,

assets

051,864185,593

967,712

Banking offices

Inoperation

229

To beoperated

31


On April 17, 1970, Orange Valley Bank, Orange,N.J., and First National State Bank of New Jersey,Newark, N.J., applied to the Office of the Comp-troller of the Currency for permission to mergeunder the charter and with the title of the latter.

First National State Bank of New Jersey, Newark,N.J., with IPC deposits of $662.3 million, wasfounded in 1812 as the State Bank of Newark, andassumed its present name in 1965. The charter bankoperates 29 offices, all of which are located inEssex County. This bank has experienced goodgrowth over the last 20 years, its assets have in-creased from $172 million, in 1950, to $883 millionas of year-end 1969.

The primary service area of the charter bank isthe greater Newark area, which consists of EssexCounty, most of Union County, and parts of Morrisand Hudson counties. The city of Newark has400,000 of Essex County's total population of972,000. Essex County ranks as one of the world'sgreatest commercial and industrial centers, and issurrounded by the counties of Hudson, Bergen,Passaic, Morris, and Union, each of which is alsohighly industrialized and commercialized. NewarkAirport is one of the Nation's most active and, inthe near future, will be undergoing a major rede-

velopment program designed to make it one of theworld's most modern. The port of Newark handledabout 5.5 million long tons of cargo in 1969. EssexCounty is a major educational center of the Statewith eight colleges, a major medical center, and 16modern hospitals located within its boundaries.

The charter bank competes in its service areawith Fidelity Union Trust Company, Newark, N.J.,with $731 million in total assets; National Newarkand Essex Bank, Newark, N.J., with $688 millionin total assets; and the Howard Savings Institution,Newark, N.J., with $907 million in total assets. Italso faces aggressive competition from the large,billion-dollar New York City banks, as well asoffices of smaller institutions. The First NationalState Bank of New Jersey holds only 7.7 percentand 7.2 percent, respectively, of the $10.4 billion intotal assets and $9.1 billion in total deposits in theFirst Banking District of New Jersey.

Orange Valley Bank, with IPC deposits of $6.2million, was founded in 1917, and presently oper-ates, in addition to its main office, one drive-infacility located directly across the street. Bank man-agement has been very conservative, and as a result,the bank has experienced slow growth, and itsearnings are below those of other banks of com-parable size operating in the general area. The

152


merging bank does not have a pension plan orthe other fringe benefits essential to attract officercandidates, with the result that it faces a manage-ment succession problem owing to the imminent re-tirement of its four top officers.

The primary service area of the merging bankconsists of the four Oranges, including Orange,West Orange, East Orange, and South Orange.Those four municipalities are situated in the cen-tral part of Essex County, about 4 miles west-north-west of downtown Newark, and cover an area of 21square miles and a total population of 15,000 peo-ple. West Orange and East Orange are devotedmainly to manufacturing, although retail merchan-dising activity is also important. South Orange ismainly residential, and East Orange houses themain, or branch, offices of a number of insurancecompanies, a considerable number of office build-ings, and a number of luxury apartment buildings.

At the present time, there are 20 offices of fivecompeting banks in the Oranges, including onesavings bank with two offices, and one branch ofthe charter bank, in addition to the mergingOrange Valley Bank. National Newark and EssexBank has an office in Orange, and Fidelity UnionTrust Company has three offices in East Orange.The Second National Bank of Orange, Orange,N.J., with $37 million in total assets, has threeoffices in Orange, and the Essex County State Bank,West Orange, N.J., with assets of $8 million, main-tains two offices in West Orange.

The banking needs of the Orange communitieswill be better served by a branch of First NationalState Bank of New Jersey. Many additional bank-ing services will be provided which are now un-available through the merging bank, includingtrust services, automated accounting, specializedlending services, a much higher lending limit, andhigher interest paid on time deposits. The manage-ment succession problem of Orange Valley Bankwill be solved, and the pension plan and otherfringe benefits of the charter bank will be madeavailable to present employees of the Orange ValleyBank.

Competition will not be adversely affected by thismerger. Although the First National Bank of NewJersey is the largest bank in the State, it is not in aposition to dominate banking in New Jersey or inits service area. If the merger is approved, thecharter bank will hold 12.1 percent of deposits inits service area, as compared with 12 percent pres-ently. Although one competing institution will be

eliminated, adequate banking alternatives will re-main. Competition in the charter bank's servicearea outside of the Oranges will be little affected bythis merger. In the Oranges, however, competitionwill be increased by the addition of a branch of thestrong and aggressive First National State Bank,replacing a small, nonaggressive, noncompetitiveindependent bank not now responsive to the bank-ing needs of its community. Potential competitionwill not be affected since State branch restrictionsprohibit the de novo branching of the charter bankinto Orange, the home office city of the mergingOrange Valley Bank.

Applying the statutory criteria, we find themerger to be in the public interest, and the appli-cation, therefore, is approved.

NOVEMBER 2, 1970.


The nearest office of First National to OrangeValley is the Orange office located 1.1 miles away.First National presently has no other offices in thegeographic market area of Orange Valley (Orange,West Orange, East Orange, and South Orange).Under New Jersey law, First National is prohibitedfrom opening de novo branches in Orange, WestOrange, and South Orange because of home officeprotection provisions. According to the application,it is seeking a location for a branch in East Orange.First National derives $4.7 million in total depositsfrom Orange, $4.4 million from West Orange, $10million from East Orange and $4.2 million fromSouth Orange, or $23.3 million in total depositsfrom the service area of Orange Valley. Loansdrawn from the same area total $16 million. Inview of the fact that First National draws sub-stantial amounts of banking business from OrangeValley's geographic market area, we conclude thatthe proposed merger would eliminate substantialdirect competition between First National andOrange Valley.

Twenty-one commercial banks operate a total of141 branches in Essex County. Five savings insti-tutions operate a total of 23 banking offices. UnderNew Jersey law, savings banks are empowered toaccept demand deposits. In fact, however, savingsbanks hold a minimal percentage of county IPCdemand deposits; as of June 30, 1968, savings banksin Essex County held only about $22 million inIPC demand deposits, and commercial banks heldover $1 billion.

As of December 31, 1968, the three largest com-

153


mercial banks in Essex County held approximately83 percent of county IPC demand deposits andapproximately 51 percent of county total deposits.These same banks operated about 65 percent of allcommercial bank offices and about 55 percent of alloffices of both commercial and savings banks. FirstNational held the largest shares, approximately 29percent of county IPC demand deposits, and ap-

proximately 19 percent of county total deposits.Merger with Orange Valley would increase theseshares by only a small amount.

The proposed merger would eliminate directcompetition and increase concentration in EssexCounty. Although Orange Valley is a relativelysmall bank, its absorption by a leader in the areamay have an adverse effect on competition.

NATIONAL BANK & TRUST COMPANY OF CENTRAL PENNSYLVANIA, YORK, PA., AND THE READING TRUST COMPANY,READING, PA., AND LANCASTER COUNTY FARMERS NATIONAL BANK, LANCASTER, PA.


Lancaster County Farmers National Bank, Lancaster, Pa. (683), withThe Reading Trust Company, Reading, Pa., withand National Bank & Trust Company of Central Pennsylvania, York, Pa. (694),which hadconsolidated Dec. 7, 1970, under charter of the latter bank (694) and title "Na-tional Central Bank." The consolidated bank at date of consolidation had

Total assets

$157,188,189158,827,533

281,850,571

597,866,293

Banking offices

Inoperation

1311

22

To beoperated

46

The "Comptroller's Decision" and the "Sum- appeared in the 1969 Annual Report under themary of Report by Attorney General" for this case heading "Approved, but in litigation."

FIRST CITIZENS NATIONAL BANK, MANSFIELD, PA., AND GRANGE NATIONAL BANK OF POTTER COUNTY, ULYSSES, PA.


Grange National Bank of Potter County, Ulysses, Pa. (8739), withand First Citizens National Bank, Mansfield, Pa. (13618), which hadmerged Dec. 31, 1970, under charter and title of the latter bank (13618). Themerged bank at date of merger had

Total assets

$5,872,24519,052,692

24,924,937

Banking offices

Inoperation

CM

C

M

To beoperated

4


On October 8, 1970, Grange National Bank ofPotter County, Ulysses, Pa., and First Citizens Na-tional Bank, Mansfield, Pa., applied to the Office ofthe Comptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

First Citizens National Bank, the charter bank,with IPC deposits of $13.6 million, was organizedin 1932, and presently operates one branch, locatedin Blossburg, 10 miles south of Mansfield.

Mansfield, the home of the charter bank, has apopulation of 2,650 and is located 50 miles north ofWilliamsport and serves as a trading center for allof eastern Tioga County and the extreme westernportion of Bradford County. It is the home ofMansfield State College, a State teachers college,which has an enrollment of 3,200, a faculty of 240,and an administration staff of 256. The service areais characterized by dairy farms and timberland.Several small manufacturing and coal mining firmsscattered throughout the area provide employment

154


for a limited segment of the population. A numberof persons residing in the northern portions of theservice area find steady and substantial employ-ment in the nearby New York State industrial com-munities of Corning and Elmira.

The charter bank is third in size among banksoperating in its service area. The two banks greaterin size are Commonwealth Bank and Trust Com-pany, Muncy, Pa., with deposits of $44.5 million,and Northern National Bank and Trust Company,Wellsboro, with deposits of $25.5 million. Thosethree are the only banks with offices in TiogaCounty. Commercial banks and other financial in-stitutions in the Corning-Elmira area provide in-tense competition for the deposit dollar in thecharter bank's service area.

Grange National Bank of Potter County, themerging bank, with total IPC deposits of $4.5million, was organized in 1907, and presentlyoperates one branch in Genesee, Pa. This bank isbeset with many problems. Its management hasbeen unable to prevent the erosion of its capita]structure and to maintain the confidence of thecommunity in the bank. Many depositors haveplaced money elsewhere, and thus funds availablefor lending are restricted. The merging bank issimply unable to meet the legitimate and growingcredit needs or to offer expanded and specializedservices to its banking public. Ulysses, Pa., homeof the merging bank, is a small rural community,50 miles west of the charter bank. The mergingbank's service area consists of an area of north-eastern Potter County and a narrow strip of NewYork State, immediately north of Potter County.The economy of the service area is keyed to dairyand potato farming. Industry and commerce arevirtually nonexistent. Much of Potter County ischaracterized by vast tracts of timberland.

The merging bank is fifth in size in its servicearea. It is preceded in size by the two above-mentioned competing banks operating in thecharter bank's service area which also operatebranches in the merging bank's service area, as wellas The First National Bank of Coundersport,Coundersport, Pa., with deposits of $6.5 million,and the Citizens Bank, Coundersport, with depositsof $5.9 million.

The merger would replace the faltering merginginstitution with offices of the financially sound,

well-managed, and thriving charter bank. The re-sult should be improved service to the Ulysses com-munity in general. The resulting bank will be ina position to meet the legitimate credit needs andto offer needed expanded and specialized services tothe banking public which the merging bank cannotoffer.

Competition will not be adversely affected. Be-cause the two banks are over 50 miles apart there isno present competition between them. The result-ing bank in the combined service area will continueto be the third largest bank in charter bank's ownservice area, and competing banks will not be dis-advantaged. As the merging bank is presently anineffectual competitor, replacing it should improvecompetition rather than reduce it.

Applying the statutory criteria, it is concludedthat the proposal is in the public interest. Theapplication is, therefore, approved.

NOVEMBER 27, 1970.


The closest offices of the merging banks are over50 miles apart. The application indicates thatGrange draws some business from western sectionsof Tioga County, but not from areas of the countyserved by First Citizens. The proposed mergerwould not appear to eliminate substantial directcompetition.

Pennsylvania law permits commercial banks toopen de novo branches in their home counties andin counties contiguous thereto. Thus, Grange andFirst Citizens could be permitted to open newoffices in each other's service area. In view of itssize and recent financial difficulties, however,Grange could not be considered a likely potentialentrant into eastern Tioga County.

There are also a number of other banks eligibleto open new branches in the Ulysses-Genesee area,which does not appear to be an attractive site forsuch activity at present.

First Citizens, itself a relatively small bank, isnot among the larger banks legally eligible to enterthe service area of Grange. In view of this fact,and of the size of Grange and the rural character-istics of its service area, we conclude that the pro-posed merger would be unlikely to have a signifi-cantly adverse effect on potential competition.

155


FIRST NATIONAL BANK OF CENTRAL JERSEY, SOMERVILLE, N.J., AND THE FIRST NATIONAL BANK OF ROSELLE,ROSELLE, N J .


The First National Bank of Roselle, Roselle, NJ. (8483), withand First National Bank of Central Jersey, Somerville, NJ. (3866), which had. . . .consolidated Dec. 31, 1970, under charter and title of the latter bank (3866). Theconsolidated bank at date of consolidation had

Total assets

$17,830,469119,994,993

137,775,462

Banking offices

Inoperation

28

To beoperated

10


On July 9, 1970, the First National Bank ofCentral Jersey, Somerville, N.J., and The FirstNational Bank of Roselle, Roselle, N.J., applied tothe Comptroller of the Currency for permission tomerge under the charter and with the title of theformer.

The charter bank, with IPC deposits of $81.7million, was originally organized in 1888, andpresently operates eight banking offices in SomersetCounty. The bank ranks first in size among theseven commercial banks operating in that county,and 11th among the 64 commercial banks in theSecond Banking District. Those 64 banks have totalaggregate deposits of $3.9 billion.

The area served by the charter bank has a popu-lation of about 434,000, and includes all of Somer-set County and several communities located inbordering counties. This area has experienced rapidindustrial, commercial, and residential expansion inrecent years. Due to Somerset County's strategiclocation between New York and Philadelphia, it isexpected that the area will continue to enjoyexcellent economic growth.

The trade area presently served by The FirstNational Bank of Roselle is located in the heartof Union County. Union County, with a popula-tion of about 577,000, is one of the smaller countiesin the State, and is located in the extreme easternportion of New Jersey, adjacent to the harborsserving the port of New York and the immediateNew York Metropolitan Area. In contrast to Somer-set County, Union County is substantially devel-oped, and there is little vacant land remaining foradditional development. Although Union Countyhas substantial industries of its own, its proximityto New York places it within the orbit of thatmetropolitan area.

The First National Bank of Roselle, with IPCdeposits of $14.5 million, was originally organized

in 1906, and presently operates two banking officesin Roselle. The bank ranks 10th in size amongUnion County's 11 commercial banks which togeth-er have total deposits of $1.1 billion. It ranks 52ndamong the 64 banks located in the banking district,holding about 0.4 percent of the total bank de-posits in the district. During the period from 1964to 1969, the bank has experienced a decline indeposits. It is presently faced with a serious man-agement succession problem. Due to the proximityof its trade area to Newark, the financial center ofNew Jersey, the bank is also faced with competitionfrom the large banks based in that city. Competi-tion in Union County is also provided by severalsavings and loan associations, savings banks, per-sonal finance companies, sales finance companies,and credit unions.

There is no significant competition presentlyexisting between the participating banks. Thecharter bank has no offices in Union County, andits closest office to The First National Bank ofRoselle is 8 miles distant. The elimination of what-ever competition may now exist between thesebanks can readily be outweighed by the benefitsto follow. Consummation of the proposed trans-action will not eliminate potential competitionbetween the two banks. Because New Jersey lawprovides home office protection, de novo entry bythe charter bank into Roselle and seven other com-munities in Union County is precluded. Moreover,the size and problems faced by The First NationalBank of Roselle prevent it from being an effectivecompetitor. The addition of $14.5 million in de-posits to the charter bank will not have a significanteffect on concentration of banking resources in thearea.

Consummation of the proposed consolidation,besides solving the management problem at TheFirst National Bank of Roselle, will introduce intothe Roselle area a more viable, competing institu-tion, with greater resources and able to provide a

156


full line of banking services. The resulting bank,with its greater resources, will be in a better posi-tion to aid the growing industries in the area of thecharter bank, by making available to them theneeded local capital funds.

Applying the statutory criteria to the proposedconsolidation, we conclude that it serves the publicinterest and the application is, therefore, approved.

OCTOBER 7, 1970.


The closest offices of the consolidating banks areabout 12 miles apart, and are separated by numer-ous offices of other commercial banks. The applica-tion indicates that each draws no more than mini-mal banking business from the service area of theother. It is unlikely that any substantial direct com-petition will be eliminated by the proposed merger.

Under New Jersey law, each of the consolidatingbanks could be permitted to open de novo branches

anywhere in the Second Banking District in whichthey are both located, except in communities sub-ject to home or branch office protection. However,Roselle Bank, as one of the smallest banks inUnion County and in the entire district, could notbe considered among the most significant potentialentrants into areas served by Central Jersey Bank.

Central Jersey Bank is the largest commercialbank headquartered in Somerset County, and, as ofJune 30, 1968, was the 12th largest bank in theSecond Banking District. Its pattern of growth inrecent years has included substantial de novobranching, and it would appear to be capable offurther expansion in this manner. It could not,however, open a de novo office in Roselle. In viewof the size of Roselle Bank, and its small share(about 1.5 percent) of commercial bank deposits inUnion County, we conclude that the proposed con-solidation would be unlikely to have any signi-ficantly adverse effect on potential competition.

T H E LITTLETON NATIONAL BANK, LITTLETON, N.H., AND LISBON NATIONAL BANK, LISBON, N.H.


Lisbon National Bank, Lisbon, N.H. (15737), withand The Littleton National Bank, Littleton, N.H. (1885), which hadmerged Dec. 31, 1970, under charter and title of the latter bank (1885). Themerged bank at date of merger had

Total assets

$3,156,8188,807,562

12,037,090

Banking offices

Inoperation

21

To beoperated

3


On July 13, 1970, Lisbon National Bank, Lisbon,N.H., and The Littleton National Bank, Littleton,N.H., applied to the Comptroller of the Currencyfor permission to merge under the charter and withthe title of the latter.

Littleton, N.H., home of the charter bank, islocated in Grafton County, in the northwest sec-tion of the State, approximately equidistant fromBurlington, Vt.; Portland, Maine; Boston, Mass.;and Montreal, Canada. It has a population ofalmost 5,100, and is one of a number of towns inthe upper Connectitcut River Valley with an areapopulation of better than 23,000. The general areais one of scenic river valleys and wooded areasdotted by small urban centers surrounded by ruralcommunities. Historically, agriculture and the lum-

ber industry dominated the economy. Althoughagriculture has declined, the wood products indus-try continues to be important. Smaller and morediversified industry has grown up in the area,and Littleton provides the largest concentrationof manufacturing and commercial concerns. It alsoserves as retail hub for a 15- to 20-mile radius.Tourism and recreationally-oriented industries andconstruction also contribute to the area's economy.

The Littleton National Bank, the charter bank,with IPC deposits of $5.5 million, was organized in1871, and is a unit bank.

Other banking institutions in Littleton includeThe Peoples National Bank of Littleton, organizedin 1966, with deposits of about $4 million; TheLittleton Savings Bank, with deposits of $29.1million; and The Littleton Cooperative Bank.

157


Beneficial Finance Co. of Littleton and M.A.C.Finance Plan of Littleton, Inc., also operate in thistown.

Lisbon also lies near the foothills of the WhiteMountains, about 10 miles southwest of Littleton,and has a population of about 1,500. Sugar Hill,where the merging bank's branch is located, lies 5miles from Lisbon and 12 miles from Littleton.Adjacent to Sugar Hill, and included in the merg-ing bank's service area, is Franconia, which is situ-ated in the heart of the White Mountains and is afour-season recreational area with a number oflodges, motels, and inns catering to skiers, hunters,tourists, and vacationers.

Lisbon National Bank, the merging bank, withIPC deposits of $2.5 million, was organized in 1889,under a State charter. It became a National bank in1969. In addition to its head office, which is theonly bank in Lisbon, it operates one branch inSugar Hill.

Competitors for the Lisbon bank are the above-mentioned banks in Littleton. Also competing withboth banks are nine other banks located between11 and 40 miles from Lisbon and between 11 and30 miles from Littleton. Because of easy accessibil-ity to the area by means of superhighways, a num-ber of the larger banks in Concord and Manchester,N.H., are constantly soliciting local deposits andloans, in some cases offering more attractive finan-cial arrangements.

This merger would benefit the communitieswhere both banks presently exist by creating alarger institution more capable of meeting thearea's banking needs. Trust facilities will be ex-panded in Littleton, and introduced actively inLisbon as a result of this merger. The marshallingof the resources of the two banks will permit amodest data processing system to be installed. Thelarger lending limit will mean that fewer loan par-ticipations will be necessary. Development of man-agement in depth will help to improve existingservices, as well as provide new ways of satisfying

customer needs. The merged institution should bein a position to pay higher salaries and thus attractmore capable people. The normal operating econo-mies resulting from such a merger would generallymake available better service at lower cost.

Competition will not be adversely affected. Al-though one banking alternative will be eliminated,the combination of these two small banks shouldnot significantly disadvantage competing institu-tions as many alternatives will remain. A largerbank will be in a better position to meet the com-petitive challenges within and outside the area.

Applying the statutory criteria, it is concludedthe proposed merger is in the public interest. Theapplication is, therefore, approved.

NOVEMBER 30, 1970.


The towns of Littleton (population 5,000) andLisbon (population 1,500) are located in thenorthern part of Grafton County, and are approxi-mately 10 miles apart. Sugar Hill (population 400),where Lisbon National operates a branch office, is10 miles from Lisbon and 12 miles from Littleton.Littleton is the trading center for the smaller townswithin a radius of 15 to 20 miles; and there are aconsiderable number of other small banks in thisbroad area. Economic growth in the Littleton-Lisbon area is slow. There are a few industrialfirms in Littleton, primarily lumber and apparelmanufacturers.

This proposed merger involves two small bankslocated in small communities approximately 10miles apart. Lisbon National is the only bank inLisbon. There are two banks in Littleton: ThePeoples National Bank of Littleton (total deposits$3.3 million) and Littleton National. There areno other banks in the intervening area. Thus, theproposed merger would eliminate direct competi-tion between the merging banks; and, for thisreason, would have an adverse effect on competitionin the Littleton-Lisbon area.

158


// . Mergers consummated pursuant to corporate reorganization, involving a singleoperating bank

GOSHOGTON NATIONAL BANK, COSHOCTON, OHIO, AND NATIONAL BANK OF GOSHOGTON, COSHOCTON, OHIO


Goshocton National Bank, Goshocton, Ohio (13923), withand National Bank of Coshocton, Goshocton, Ohio (13923), which hadmerged Jan. 3, 1970, under charter of the latter bank (13923) and title "Goshoc-ton National Bank." The merged bank at date of merger had

Total assets

$45,738,949120,000

45,858,949

Banking offices

Inoperation

30

To beoperated

3


On September 10, 1969, the Coshocton NationalBank, Coshocton, Ohio, and the National Bank ofCoshocton (organizing), Coshocton, Ohio, appliedto the Comptroller of the Currency for permissionto merge under the charter of the latter and withthe title of the former.

Coshocton National Bank, the merging bank, isheadquartered in Coshocton, and has two branches,both in Coshocton. This bank, with total resourcesof $43.6 million and IPC deposits of $36.4 million,was originally chartered in 1892.

National Bank of Coshocton, the charter bank,is being organized to provide a vehicle to transferownership of the merging bank to the First BaneGroup of Ohio, Inc. The charter bank will not beoperating as a commercial bank prior to themerger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same banking busi-

ness at the same locations and with the same nameas presently conducted by the merging bank.


NOVEMBER 25, 1969.


The proposed merger is part of a plan underwhich First Bane Group of Ohio, Inc., a registeredbank holding company, proposes to acquire all ofthe voting shares of National Bank of Coshocton(organizing), a non-operating institution, and as acontemporaneous transaction, to effect the mergerof Coshocton National Bank into National Bank ofCoshocton (organizing). The effect of these trans-actions will be to transfer control of an existingbank to a registered bank holding company. In andof itself, however, the proposed merger wouldmerely combine an existing bank with a non-operat-ing institution; as such, and without regard to ac-quisition of the surviving bank by First Bane Groupof Ohio, Inc., the proposed merger would have noeffect on competition.

FIRST NATIONAL BANK OF CAMBRIDGE, CAMBRIDGE, OHIO, AND THE GUERNSEY COUNTY NATIONAL BANK,CAMBRIDGE, OHIO


First National Bank of Cambridge, Cambridge, Ohio (6566), withand The Guernsey County National Bank, Cambridge, Ohio (6566), which had. .merged Jan. 3, 1970, under charter of the latter bank (6566) and title "FirstNational Bank of Cambridge." The merged bank at date of merger had

Total assets

$28,898,008120,000

29,018,008

Banking offices

Inoperation

20

To beoperated

2

159



On September 9, 1969, the First National Bankof Cambridge, Cambridge, Ohio, and The Guern-sey County National Bank (organizing), Cambridge,Ohio, applied to the Comptroller of the Currencyfor permission to merge under the charter of thelatter and with the title of the former.

First National Bank of Cambridge is head-quartered in Cambridge, and operates one drive-inbranch, located in Cambridge. The bank, whichwas chartered in 1863, now has total resources of$25.9 million, and IPC deposits of $20.9 million.

The Guernsey County National Bank, the charterbank, is being organized to provide a vehicle totransfer ownership of the merging bank to the FirstBane Group of Ohio, Inc., a registered bank hold-ing company. The charter bank will not be oper-ating prior to the merger.

Since the merging bank is the only operatingbank involved in the proposed transaction, no ad-verse effect on competition can result from consum-mation of the proposed merger. The resulting bankwill conduct the same banking business at the same

locations and with the same name as is presentlyused by the merging bank.

Applying the statutory criteria, we find that theproposed merger is in the public interest and theapplication is, therefore, approved.

NOVEMBER 25, 1969.


The proposed merger is part of a plan underwhich First Bane Group of Ohio, Inc., a registeredbank holding company, proposes to acquire all ofthe voting shares of Guernsey County NationalBank (organizing), a non-operating institution, andas a contemporaneous transaction, to effect themerger of First National Bank of Cambridge intoGuernsey County National Bank (organizing). Theeffect of these transactions will be to transfer con-trol of an existing bank to a registered bank hold-ing company. In and of itself, however, the pro-posed merger would merely combine an existingbank with a non-operating institution; as such, andwithout regard to acquisition of the surviving bankby First Bane Group of Ohio, Inc., the proposedmerger would have no effect on competition.

FIRST NATIONAL BANK OF N E W J ERSEY, NEWARK, N.J., AND NATIONAL STATE BANK OF N E W JERSEY, NEWARK, N J .


First National State Bank of New Jersey, Newark, N J . (1452), withand National State Bank of New Jersey, Newark, N J . (1452), which hadmerged Jan. 14, 1970, under charter of the latter bank (1452) and title "FirstNational State Bank of New Jersey." The merged bank at date of merger h a d . . . .

Total assets

$837,613,392256,000

837,620,610

Banking offices

Inoperation

290

To beoperated

29


On August 18, 1969, the National State Bank ofNew Jersey (organizing), Newark, N.J., applied tothe Office of the Comptroller of the Currency forpermission to merge with the First National StateBank of New Jersey, Newark, N.J., under thecharter of the former and with the title of thelatter.

The First National State Bank of New Jersey,the merging bank, is located in Newark, N.J., a cityof 400,000. The bank was chartered in 1812, andpresently has IPC deposits of $586.9 million. At the

time of the application it had 27 active branches inaddition to the main office.

The National State Bank of New Jersey, thecharter bank, which is owned by First NationalState Bancorporation, a holding company, is beingorganized as a means to transfer ownership of theFirst National State Bank of New Jersey to theholding company. Prior to the merger, the organiz-ing bank will not be operational. With the excep-tion of the directors' qualifying shares, all of theshares of the resulting bank will be owned by FirstNational State Bancorporation.

Because the merging bank is the only operating

160


bank in the proposed transaction, there can be noadverse effect on competition resulting from con-summation of the proposed merger. The resultingbank will continue to conduct the merging bank'sbusiness at the present locations, under title of theFirst National State Bank of New Jersey.

The application is, therefore, approved.DECEMBER 9, 1969


The proposed merger is part of a plan by whichan existing bank will become a wholly-owned sub-sidiary of First National State Bancorporation. Itwould combine an existing bank with a non-operating institution, As such, it is merely a stepin what is essentially a corporate reorganizationand will have no effects on competition.

GALLATIN NATIONAL BANK, UNIONTOWN, PA., AND BLYTHE NATIONAL BANK, UNIONTOWN, PA.


Gallatin National Bank, Uniontown, Pa. (5034), withand Blythe National Bank, Uniontown, Pa. (5034), which hadmerged Feb. 24, 1970, under charter of the latter bank (5034) and title "GallatinNational Bank." The merged bank at date of merger had

Total assets

$148,702,947120,000

148,708,580

Banking offices

Inoperation

200

To beoperated

20


On October 21, 1969, the Blythe National Bank(organizing), Uniontown, Pa., applied to the Officeof the Comptroller of the Currency for permissionto merge with the Gallatin National Bank, Union-town, Pa., under the charter of the former and withthe title of the latter.

The Gallatin National Bank, the merging bank,is located in Uniontown, Pa., a city of 17,900. Thebank was chartered in 1896, and presently has IPCdeposits of $126.4 million. At the time of the appli-cation it had 19 active branches and one approved,but unopened, facility.

The Blythe National Bank, Uniontown, Pa.,owned by the GNB Corporation, is being organizedas a means to transfer ownership of the GallatinNational Bank to the holding corporation. Prior tothe merger, the organizing bank will not be opera-tional. With the exception of the directors' qualify-

ing shares, all of the shares of the resulting bankwill be owned by the GNB Corporation.

Because the Gallatin National Bank is the onlyoperating bank in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will continue to conduct the merg-ing bank's business at the present locations, undertitle of the Gallatin National Bank.

The application is, therefore, approved.DECEMBER 19, 1969.


[This merger] * * * is part of a transaction whichwill result in a presently existing bank becoming awholly-owned subsidiary of a one-bank holdingcompany. Thus, * * * [it] is merely part of a cor-porate reorganization, and as such will have noeffect on competition.

COLUMBUS NATIONAL BANK OF RHODE ISLAND, PROVIDENCE, R.I., AND RHODES NATIONAL BANK, PROVIDENCE, R.I.


Columbus National Bank of Rhode Island, Providence, R.I. (13981), withand Rhodes National Bank, Providence, R.I. (13981), which hadmerged Feb. 27, 1970, under charter of the latter bank (13981) and title "Colum-bus National Bank of Rhode Island." The merged bank at date of merger had. .

Total assets

$47

47

231258

395

,200,700

,936

Banking offices

Inoperation

coo

••

To beoperated

8

161



On August 29, 1969, the Rhodes National Bank(organizing), Providence, R.I., applied to the Of-fice of the Comptroller of the Currency for permis-sion to merge with the Columbus National Bankof Rhode Island, Providence, R.I., under thecharter of the former and with the title of the lat-ter.

The Columbus National Bank of Rhode Island,the merging bank, is located in Providence, R.I.,a city of 200,000. The bank was chartered in 1934and presently has IPC deposits of $34.8 million. Atthe time of the application it had seven activebranches, one approved but under construction,and an application pending for another facility.

The Rhodes National Bank, Providence, R.I.,owned by National Columbus Bancorporation, isbeing organized as a means to transfer ownershipof the Columbus National Bank of Rhode Islandto the National Columbus Bancorporation. Priorto the merger, the organizing bank will not beoperational. With the exception of the directors'

qualifying shares, all of the shares of the resultingbank will be owned by the National ColumbusBancorporation.

Because the Columbus National Bank of RhodeIsland is the only operating bank in the proposedtransaction, there can be no adverse effect on com-petition resulting from consummation of the pro-posed merger. The resulting bank will conduct themerging bank's business at the present locations,under title of the Columbus National Bank ofRhode Island.

The application is, therefore, approved.JANUARY 5, 1970.


[This merger] # # # is part of a transactionwhich will result in a presently existing bank be-coming a wholly-owned subsidiary of a one-bankholding company. Thus, * * * [it] is merely partof a corporate reorganization, and as such willhave no effect on competition.

CUMBERLAND COUNTY NATIONAL BANK AND TRUST COMPANY, N E W CUMBERLAND, PA., AND CCNBNATIONAL BANK, N E W CUMBERLAND, PA.


Banking offices

Inoperation

To beoperated

Cumberland County National Bank and Trust Company, New Cumberland, Pa.(14542), withand CCNB National Bank, New Cumberland, Pa. (14542), which hadmerged Mar. 25, 1970, under charter of the latter bank (14542) and title "Cum-berland County National Bank and Trust Company." The merged bank at dateof merger had

$100,992,134123,500

101,115,634

110

11


On October 2, 1969, the CCNB National Bank(organizing), New Cumberland, Pa., applied to theOffice of the Comptroller of the Currency for per-mission to merge with Cumberland County Na-tional Bank and Trust Company, New Cumberland,Pa., under the charter of the former and with thetitle of the latter.

The Cumberland County National Bank andTrust Company, the merging bank, is located inNew Cumberland, Pa., a town of 9,250. The bankreceived its National charter in April 1946, andpresently has IPC deposits of $86.6 million. At the

time of the application it had nine active branchesand two facilities.

The CCNB National Bank, owned by CCNBCorporation, is being organized as a means totransfer ownership of the Cumberland CountyNational Bank and Trust Company to the CCNBCorporation. Prior to the merger, the organizingbank will not be operational. With the exceptionof the directors' qualifying shares, all of the sharesof the resulting bank will be owned by the CCNBCorporation.

Because the Cumberland County National Bankand Trust Company is the only operating bank inthe proposed transaction, there can be no adverse

162


effect on competition resulting from consummationof the proposed merger. The resulting bank willcontinue to conduct the merging bank's business atthe present locations under title of CumberlandCounty National Bank and Trust Company. Theapplication is, therefore, approved.

DECEMBER 16, 1969.


[This merger] * * * is part of a transaction whichwill result in a presently existing bank becominga wholly-owned subsidiary of a one-bank holdingcompany. Thus, * * * [it] is merely part of a cor-porate reorganization, and as such will have noeffect on competition.

THE CITIZENS NATIONAL BANK OF GHILLICOTHE, CHILLICOTHE, MO. , AND CHILLICOTHE NATIONAL BANK,GHILLIGOTHE, M O .


The Citizens National Bank of Chillicothe, Chillicothe, Mo. (4111), withand Chillicothe National Bank, Chillicothe, Mo. (4111), which hadmerged Apr. 30, 1970, under charter of the latter bank (4111) and title "TheCitizens National Bank of Chillicothe." The merged bank at date of merger had. .

Total assets

$39,078,164129,638

39,230,582

Banking offices

Inoperation

10

To beoperated

1


On May 13, 1969, The Citizens National Bankof Chillicothe, Chillicothe, Mo., and the ChillicotheNational Bank (organizing), Chillicothe, Mo., filedan application with the Comptroller of the Cur-rency for permission to merge under the charter ofthe latter and with the title of the former.

The Citizens National Bank was chartered in1889, and now holds IPC deposits of $28 million.

The Chillicothe National Bank is an non-operat-ing institution organized as a step in the corporatereorganization of the merging bank. With the ex-ception of the directors' qualifying shares, all of thestock of the charter bank is owned by CitizensBancshares Corporation, a Missouri corporation.

Since the charter bank is a non-operating institu-tion, approval of this application will have no

effect on competition. Service to the public will notbe affected by this transaction as the resulting bankwill operate through the personnel and physicalfacilities of the merging bank. Approval of themerger will, however, facilitate the corporate re-organization of the merging bank.

Applying the statutory criteria, we find that thisproposal is in the public interest and the applica-tion is, therefore, approved.

JULY 10, 1969.


[This merger] * * * is part of a transaction whichwill result in a presently existing bank becoming awholly-owned subsidiary of a one-bank holdingcompany. Thus, * * * [it] is merely part of a cor-porate reorganization and as such will have noeffect on competition.

THE FORT WORTH NATIONAL BANK, FORT WORTH, TEX., AND BANK OF FORT WORTH, N.A., FORT WORTH, TEX.


The Fort Worth National Bank, Fort Worth, Tex. (3131), withand Bank of Fort Worth, N.A., Fort Worth, Tex. (3131), which hadmerged Apr. 30, 1970, under charter of the latter bank (3131), and title "TheFort Worth National Bank." The merged bank at date of merger had

Total assets

$553,845,040250,000

554,095,040

Banking offices

Inoperation

10

To beoperated

1

163



On February 2, 1970, the Bank of Fort Worth,N.A. (organizing), Fort Worth, Tex., applied to theOffice of the Comptroller of the Currency for per-mission to merge with The Fort Worth NationalBank, Fort Worth, Tex., under the charter of theformer and with the title of the latter.

The Fort Worth National Bank, the mergingbank, is located in Fort Worth, Tex., a city of360,000. The bank was chartered in 1873, andpresently has IPC deposits of $292.7 million.

The Bank of Fort Worth, N.A., owned by FortWorth National Corporation, is being organized asa means to transfer ownership of The Fort WorthNational Bank to the holding company. Prior tothe merger, the organizing bank will not be opera-tional. With the exception of the directors' qualify-ing shares, all of the shares of the resulting bank

will be owned by the Fort Worth National Cor-poration.

Because the merging bank is the only operatingbank in the proposed transaction, there can be noadverse effect on competition resulting from con-summation of the proposed merger. The resultingbank will continue to conduct the merging bank'sbusiness at the present locations, under the title ofThe Fort Worth National Bank. The applicationis, therefore, approved.

MARCH 17, 1970.


The proposed merger is part of a transactionwhich will result in Fort Worth National Bankbecoming a wholly-owned subsidiary of a one-bankholding company. Thus, this merger is merely partof a corporate reorganization and as such will haveno effect on competition.

THE FIRST NATIO NAL BANK OF ST. JOSEPH, ST. JOSEPH, M O . , AND FIRST NATIONAL BANK OFBUCHANAN COUNTY, ST. JOSEPH, M O .


The First National Bank of St. Joseph, St. Joseph, Mo. (4939), withand First National Bank of Buchanan County, St. Joseph, Mo. (4939), which had.merged May 1, 1970, under charter of the latter bank (4939) and title "The FirstNational Bank of St. Joseph." The merged bank at date of merger had

Total assets

$60,902,363236,800

61,573,596

Banking offices

Inoperation

20

To beoperated

2


On January 13, 1970, the First National Bankof St. Joseph, St. Joseph, Mo., and the First Na-tional Bank of Buchanan County (organizing), St.Joseph, Mo., applied to the Comptroller of theCurrency for permission to merge under the charterof the latter and with the title of the former.

The First National Bank of St. Joseph, themerging bank, has total resources of $62 million,and IPC deposits of $43 million. The First NationalBank of Buchanan County, the charter bank, isbeing organized to provide a vehicle to transferownership of the merging bank to the First Mid-west Bancorp., Inc. The charter bank will not beoperating as a commercial bank prior to merging.

Because the merging bank is the only operatingbank involved in the proposed transaction, there

can be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same banking busi-ness at the same location and with the same nameas presently used by the merging bank.


MARCH 25, 1970.


The proposed merger is part of a plan of a cor-porate reorganization of First National Bank ofSt. Joseph and will combine an existing bank witha non-operating institution. As such, it will have noeffect on competition.

164


NATIONAL NEWARK & ESSEX BANK, NEWARK, N.J., AND ESSEX BANK, N.A., NEWARK, N J .


National Newark & Essex Bank, Newark, NJ. (1316), withand Essex Bank, N.A., Newark, NJ. (1316), which hadmerged June 12, 1970, under charter of the latter bank (1316) and title "NationalNewark & Essex Bank." The merged bank at date of the merger had

Total assets

$694

694

,373250

,623

,972,000

,972

Banking offices

Inoperation

370

To beoperated

37


On March 13, 1970, the National Newark &Essex Bank, Newark, N.J., and the Essex Bank,N.A. (organizing), Newark, N.J., applied to theComptroller of the Currency for permission tomerge under the charter of the latter and with thetitle of the former.

National Newark and Essex Bank, the mergingbank, is headquartered in Newark, N.J., and hasoffices located throughout Essex County. Thisbank, with total resources of $710 million, andIPC deposits of $543 million, was chartered orig-inally in 1865.

Essex Bank, N.A., the charter bank, is being or-ganized to provide a vehicle to transfer ownershipof the merging bank to the Midlantic Banks, Inc.The charter bank will not be operating as a com-mercial bank prior to the merger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same banking

business at the same locations and with the samename as presently used by the merging bank.


MAY 11, 1970.


The proposed merger is part of a plan underwhich Midlantic Banks, Inc., a registered bankholding company, proposes to acquire all of thevoting shares of Essex Bank, N.A. (org.), a non-operating institution, and, as a contemporaneoustransaction, to effect the merger of National New-ark & Essex Bank into Essex Bank, N.A. (org.).The effect of these transactions will be to transfercontrol of an existing bank to a registered bankholding company. In and of itself, however, theproposed merger would merely combine an exist-ing bank with a non-operating institution; as such,and without regard to acquisition of the survivingbank by Midlantic Banks, Inc., the proposedmerger would have no effect on competition.

RARITAN VALLEY NATIONAL BANK, EDISON TOWNSHIP, NJ. , AND SECOND RARITAN VALLEYNATIONAL BANK, EDISON TOWNSHIP, N.J.


Raritan Valley National Bank, Edison Township, NJ. (15430), withand Second Raritan Valley National Bank, Edison Township, NJ.which hadmerged June 12, 1970, under charter of the latter bank (15430) and titleValley National Bank." The merged bank at date of merger had

(15430),

"Raritan

Total assets

$24

24

562,416

250,000

812,416

Banking offices

Inoperation

4

0

To beoperated

4


On March 13, 1970, the Second Raritan ValleyNational Bank (organizing), Edison Township,N.J., applied to the Office of the Comptroller of the

Currency for permission to merge with the RaritanValley National Bank. Edison Township, N.J.,under the charter of the former and with the titleof the latter.

165


The Raritan Valley National Bank, the mergingbank, is located in Edison Township, N.J., a cityof 68,750. The bank was chartered in 1964, andpresently has IPC deposits of $16.5 million. Atthe time of the application, it had three activebranches and one approved but unopened facility.

The Second Raritan Valley National Bank,owned by Midlantic Banks, Inc., is being organizedas a means to transfer ownership of Raritan ValleyNational Bank to the holding company. With theexception of the directors' qualifying shares, all ofthe shares of the resulting bank will be owned bythe Midlantic Banks, Inc. Prior to the merger, theorganizing bank will not be operational.

Because the Raritan Valley National Bank is theonly operating bank in the proposed transaction,there can be no adverse effect on competition re-sulting from consummation of the proposed merger.The resulting bank will continue to conduct themerging bank's business at the present locationsunder title of Raritan Valley National Bank.

The application is, therefore, approved.MAY 11, 1970


The proposed merger is part of a plan underwhich Midlantic Banks, Inc., a registered bankholding company, proposes to acquire all of thevoting shares of Second Raritan Valley NationalBank (organizing), a non-operating institution, and,as a contemporaneous transaction, to effect themerger of Raritan Valley National Bank into Sec-ond Raritan Valley National Bank (organizing).The effect of these transactions will be to transfercontrol of an existing bank to a registered bankholding company. In and of itself, however, theproposed merger would merely combine an exist-ing bank with a non-operating institution; as such,and without regard to acquisition of the survivingbank by Midlantic Banks, Inc., the proposedmerger would have no effect on competition.

THE SUSSEX AND MERCHANTS NATIONAL BANK OF NEWTON, NEWTON, N.J., AND THE SECOND SUSSEXAND MERCHANTS NATIONAL BANK OF NEWTON, NEWTON, N J .


Banking offices

Inoperation

To beoperated

The Sussex and Merchants National Bank of Newton, Newton, NJ. (925), with. .and The Second Sussex and Merchants National Bank of Newton, Newton, NJ.(925), which hadmerged June 12, 1970, under charter of the latter bank (925) and title "The Sus-sex and Merchants National Bank of Newton." The merged bank at date ofmerger had

$51,962,403

125,000

52,087,403


On March 17, 1970, The Sussex and MerchantsNational Bank of Newton, Newton, N.J., and TheSecond Sussex and Merchants National Bank ofNewton (organizing), Newton, N.J., applied to theComptroller of the Currency for permission tomerge under the charter of the latter and with thetitle of the former.

The Sussex and Merchants National Bank ofNewton, the merging bank, is headquartered inNewton, NJ., and has five offices and one approvedbut unopened office located in Sussex County. Thisbank, with total resources of $50 million, and IPCdeposits of $41 million, was established in 1818.

The Second Sussex and Merchants NationalBank of Newton, Newton, N.J., the charter bank,is being organized to provide a vehicle to transferownership of the merging bank to the MidlanticBanks, Incorporated, Newark, N.J. The charterbank will not be operating as a commercial bankprior to the merger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same banking busi-ness at the same locations and with the same nameas presently used by the merging bank.

166



MAY 11, 1970.


The proposed merger is part of a plan underwhich Midlantic Banks, Inc., a registered bankholding company, proposes to acquire all of thevoting shares of Second Sussex and Merchants Na-tional Bank of Newton (organizing), a non-operat-ing institution and, as a contemporaneous trans-

action, to effect the merger of Sussex andMerchants National Bank of Newton into SecondSussex and Merchants National Bank of Newton(organizing). The effect of these transactions will beto transfer control of an existing bank to a regis-tered bank holding company. In and of itself, how-ever, the proposed merger would merely combinean existing bank with a non-operating institution;as such, and without regard to acquisition of thesurviving bank by Midlantic Banks, Inc., the pro-posed merger would have no effect on competiton.

N E W ENGLAND MERCHANTS NATIONAL BANK OF BOSTON, BOSTON, MASS., AND NEW ENGLANDMERCHANTS BANK (N.A.), BOSTON, MASS.


New England Merchants National Bank of Boston, Boston, Mass. (475), with.. . .and New England Merchants Bank (National Association), Boston, Mass. (475),which hadmerged June 18, 1970, under charter of the latter bank (475) and title "NewEngland Merchants National Bank." The merged bank at date of merger had. .

Total assets

$936,819,917

250,000

937,069,917

Banking offices

Inoperation

15

0

To beoperated

15


On March 3, 1969, the New England MerchantsNational Bank of Boston, Boston, Mass., and theNew England Merchants Bank (N.A.) (organizing),Boston, Mass., applied to the Comptroller of theCurrency for permission to merge under the charterof the latter and with the title "New England Mer-chants National Bank."

New England Merchants National Bank of Bos-ton, the merging bank, is headquartered in Boston,and has three branches in Boston and one inRevere. The bank, with total resources of $921.2million, and IPC deposits of $495.2 million, wasoriginally chartered in 1831.

New England Merchants Bank (N.A), the charterbank, is being organized to provide a vehicle totransfer ownership of the merging bank to the NewEngland Merchants Company, Inc. The charterbank will not be operating as a commercial bankprior to the merger.



APRIL 21, 1970.


The proposed merger is part of a transactionwhich will result in New England Merchants Na-tional Bank of Boston becoming a wholly-ownedsubsidiary of a one-bank holding company. Thus,this merger is merely part of a corporate reorganiza-tion and, as such, will have no effect on compe-tition.

167


FIRST NATIONAL BANK OF WARREN, WARREN, MICH., AND WARREN NATIONAL BANK, WARREN, MICH.


First National Bank of Warren, Warren, Mich. (15611), withand Warren National Bank, Warren, Mich. (15611), which hadmerged July 1, 1970, under charter of the latter bank (15611) and title "FirstNational Bank of Warren." The merged bank at date of merger had

Total assets

$25,354,056250,000

25,604,056

Banking offices

Inoperation

30

To beoperated

3


On April 22, 1970, First National Bank of War-ren, Warren, Mich., and Warren National Bank(organizing), Warren, Mich., applied to the Comp-troller of the Currency for permission to mergeunder the charter of the latter and with the titleof the former.

First National Bank of Warren, the mergingbank, is headquartered in Warren, Mich., andmaintains two branches there. This bank, withtotal resources of $20 million, and IPC depositsof about $10 million, was chartered in 1966.

Warren National Bank, the charter bank, is be-ing organized to provide a vehicle to transferownership of the merging bank to the First Na-tional Bancorporation, an Ohio corporation. Thecharter bank will not be operating as a commercialbank prior to the merger.


ness at the same locations and with the same nameas presently used by the merging bank.


MAY 28, 1970.


The proposed merger is part of a plan underwhich First National Bancorp., a registered bankholding company, proposes to acquire all of thevoting shares of Warren National Bank (org.), anon-operating institution, and, as a contemporane-ous transaction, to effect the merger of First Na-tional Bank of Warren into Warren National Bank(org.). The effect of these transactions will be totransfer control of an existing bank to a registeredbank holding company. In and of itself, however,the proposed merger would merely combine an ex-isting bank with a non-operating institution; assuch, and without regard to acquisition of the sur-viving bank by First National Bancorp., the pro-posed merger would have no effect on competition.

THE NATIONAL BANK OF AUBURN, AUBURN, N.Y., AND BANK OF AUBURN, N.A., AUBURN, N.Y.


The National Bank of Auburn, Auburn, N.Y. (1345), withand Bank of Auburn, National Association, Auburn, N.Y. (1345), which had . . . .merged July 28, 1970, under charter of the latter bank (1345) and title "TheNational Bank of Auburn." The merged bank at date of merger had

Total assets

$34,911,915240,000

34,656,987

Banking offices

Inoperation

40

To beoperated

4


On August 1, 1969, The Bank of Auburn, N.A.,(organizing), Auburn, N.Y., applied to this Office

for permission to merge with The National Bankof Auburn, Auburn, N.Y., under the charter of theformer and with the title of the latter.

168


The National Bank of Auburn, the mergingbank, is located in Auburn, N.Y., a city of 32,953.The bank was chartered in 1817, and presently hasIPC deposits of $26.8 million. At the time of theapplication, it had two drive-in branches in Au-burn, and a branch in Locke, N.Y.

The Bank of Auburn, N.A., Auburn, N.Y., isbeing organized as a means to transfer owner-ship of the National Bank of Auburn to theSecurity New York State Corporation. Prior tothe merger, the organizing bank will not be op-erational. With the exception of the directors'qualifying shares, all of the shares of the resultingbank will be owned by the holding company.

Because the merging bank is the only operatingbank in the proposed transaction, there can beno adverse effect on competition resulting fromconsummation of the proposed merger. The re-sulting bank will continue to conduct the merg-ing bank's business at the present locations under

the title of The Bank of Auburn, N.A. The appli-cation is, therefore, approved.

JUNE 11, 1970.


The proposed merger is part of a plan underwhich Security New York State Corporation, a reg-istered bank holding company, proposes to acquireall of the voting shares of Bank of Auburn (or-ganizing), a non-operating institution and, as acontemporaneous transaction, to effect the mergerof National Bank of Auburn into Bank of Auburn(organizing). The effect of these transactions willbe to transfer control of an existing bank to aregistered bank holding company. In and of itself,however, the proposed merger would merely com-bine an existing bank with a non-operating institu-tion; as such, and without regard to acquisition ofthe surviving bank by Security New York StateCorporation, the proposed merger would have noeffect on competition.

THE PEOPLES NATIONAL BANK AND TRUST COMPANY, DOVER, OHIO, AND THE F.B.G. NATIONAL BANKOF DOVER, DOVER, OHIO


The Peoples National Bank and Trust Company, Dover, Ohio (4293), withand The F.B.G. National Bank of Dover, Dover, Ohio (4293), which hadmerged Aug. 31, 1970, under charter of the latter bank (4293) and title "ThePeoples National Bank and Trust Company." The merged bank at date of mer-ger had

Total assets

$43,190,998120,000

43,191,034

Banking offices

Inoperation

40

To beoperated

4


On April 25, 1970, The Peoples National Bankand Trust Company, Dover, Ohio, and The F.B.G.National Bank of Dover (organizing), Dover,Ohio, applied to the Comptroller of the Currencyfor permission to merge under the charter of thelatter and with the title of the former.

The Peoples National Bank and Trust Com-pany, the merging bank, is headquartered inColumbus, Ohio, and has offices located in NewPhiladelphia and Newcomerstown. This bank,with total resources of $41 million, was charteredoriginally in 1890.

The F.B.G. National Bank of Dover, the charterbank, is being organized to facilitate the acquisi-tion of the merging bank by First Bane Group.

The charter bank will not be operating as a com-mercial bank prior to the merger.


Applying the statutory criteria, it is concludedthat the proposed merger is in the public interest,and the application is, therefore, approved.

JULY 9, 1970.


The proposed merger is part of a plan under

169


which First Bane Group of Ohio, Inc., a registeredbank holding company, proposes to acquire allof the voting shares of F.B.G. National Bank ofDover (org.), a non-operating institution and, asa contemporaneous transaction, to effect the mergerof Peoples National Bank & Trust Company intoF.B.G. National Bank of Dover (org.). The effectof these transactions will be to transfer control

of an existing bank to a registered bank holdingcompany. In and of itself, however, the proposedmerger would merely combine an existing bankwith a non-operating institution; as such, andwithout regard to acquisition of the survivingbank by First Bane Group of Ohio, Inc., the pro-posed merger would have no effect on competition.

PEOPLES NATIONAL BANK OF MONMOUTH COUNTY, HAZLET TOWNSHIP, N.J., AND SECOND PEOPLES NATIONALBANK OF MONMOUTH COUNTY, HAZLET TOWNSHIP, N.J.

of bank and type of transaction Total assets

Banking offices

Inoperation

To beoperated

Peoples National Bank of Monmouth County, Hazlet Township, N.J. (4147),withand Second Peoples National Bank of Monmouth County, Hazlet Township,NJ. (4147), which hadmerged Sept. 30, 1970, under charter of the latter bank (4147) and title "PeoplesNational Bank of Monmouth County." The merged bank at date of merger had. .

$33,985,363

116,467

33,977,506


On July 8, 1970, the Peoples National Bank ofMonmouth County, Hazlet Township, N.J., andthe Second Peoples National Bank of MonmouthCounty (organizing), Hazlet Township, N.J., ap-plied to the Comptroller of the Currency for per-mission to merge under the charter of the latterand with the title of the former.

Peoples National Bank of Monmouth County,the merging bank, is headquartered in HazletTownship, N.J., and has offices located through-out the Atlantic shore area of Monmouth County,N.J. This bank, with IPC deposits of 24.3 million,was chartered originally in 1889.

Second Peoples National Bank of MonmouthCounty, the charter bank, is being organized toprovide a vehicle to transfer ownership of the merg-ing bank to the United Jersey Banks, a NewJersey corporation organized as a proposed reg-istered bank holding company. The charter bankwill not operate as a commercial bank prior to themerger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. The

resulting bank will conduct the same bankingbusiness at the same locations and with the samename as presently used by the merging bank.


AUGUST 27, 1970.


The proposed merger is part of a plan underwhich United Jersey Banks, a registered bankholding company, proposes to acquire all of thevoting shares of Second Peoples National Bankof Monmouth County (organizing), a non-operat-ing institution and, as a contemporaneous trans-action, to effect the merger of Peoples NationalBank of Monmouth County and Second PeoplesNational Bank of Monmouth County (organiz-ing) . The effect of these transactions will be totransfer control of an existing bank to a registeredbank holding company. In and of itself, however,the proposed merger would merely combine anexisting bank with a non-operating institution; assuch, and without regard to acquisition of the sur-viving bank by United Jersey Banks, the proposedmerger would have no effect on competition.

170


T H E CUMBERLAND NATIONAL BANK OF BRIDGETON, BRIDGETON, N.J., AND CUMBERLAND COUNTYNATIONAL BANK, BRIDGETON, N J .


The Cumberland National Bank of Bridgeton, Bridgeton, NJ . (1346) ,withand Cumberland County National Bank, Bridgeton, NJ . (1346), which hadmerged Sept. 30, 1970, under charter of the latter bank (1346) and title "TheCumberland National Bank of Bridgeton." The merged bank at date of mergerhad

Total assets

$31,083,446120,000

31,153,207

Banking offices

Inoperation

30

To beoperated

3


On July 8, 1970, The Cumberland National Bankof Bridgeton, Bridgeton, N.J., and the CumberlandCounty National Bank (organizing), Bridgeton,N.J., applied to the Comptroller of the Currencyfor permission to merge under the charter of thelatter and with the title of the former.

The Cumberland National Bank of Bridgeton,the merging bank, is headquartered in Bridgeton,and operates three offices in Cumberland County.This bank, with IPC deposits of $23 million, wasorganized in 1816.

Cumberland County National Bank, the charterbank, is being organized to provide a vehicle totransfer ownership of the merging bank to UnitedJersey Banks, a New Jersey corporation organizedas a proposed registered bank holding company.The charter bank will not operate as a commercialbank prior to the merger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same banking busi-ness at the same locations and with the same name

and personnel as are presently used by the mergingbank.


AUGUST 27, 1970.


The proposed merger is part of a plan underwhich United Jersey Banks, a registered bank hold-ing company, proposes to acquire all of the votingshares of Cumberland County National Bank (or-ganizing), a non-operating institution and, as acontemporaneous transaction, to effect the mergerof Cumberland National Bank of Bridgeton andCumberland County National Bank (organizing).The effect of these transactions will be to transfercontrol of an existing bank to a registered bankholding company. In and of itself, however, theproposed merger would merely combine an exist-ing bank with a non-operating institution; as such,and without regard to acquisition of the survivingbank by United Jersey Banks, the proposed mergerwould have no effect on competition.

T H E THIRD NATIONAL BANK & TRUST COMPANY OF GAMDEN, GAMDEN, N J . , AND T H E FOURTH NATIONALBANK & TRUST COMPANY OF CAMDEN, CAMDEN, N J .


Banking offices

Inoperation

To beoperated

The Third National Bank & Trust Company of Camden, Camden, NJ . (13203),withand The Fourth National Bank & Trust Company of Camden, Camden, NJ .(13203), which hadmerged Sept. 30, 1970, under charter of the latter bank (13203) and title "TheThird National Bank and Trust Company of Camden, New Jersey." The mergedbank at date of merger had

$26,720,278

240,000

26,960,278

171



On July 8, 1970, The Third National Bank &Trust Company of Camden, Camden, N.J., andThe Fourth National Bank and Trust Companyof Camden, Camden, N.J., (organizing), appliedto the Comptroller of the Currency for permissionto merge under the charter of the latter and withthe title of the former.

The Third National Bank & Trust Company ofCamden, the merging bank, is headquartered inCamden, N.J., and has offices located throughoutthe Camden Metropolitan Area. This bank, withIPC deposits of $19.6 million, was charteredoriginally in 1928.

The Fourth National Bank and Trust Companyof Camden, the charter bank, is being organizedto provide a vehicle to transfer ownership of themerging bank to the United Jersey Banks, a NewJersey corporation organized as a proposed reg-istered bank holding company. The charter bankwill not be operating as a commercial bank priorto the merger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same banking

business at the same locations and with the samename and personnel as are presently used by themerging bank.


AUGUST 27, 1970.


The proposed merger is part of a plan underwhich United Jersey Banks, a registered bankholding company, proposes to acquire all of thevoting shares of Fourth National Bank & Trust Co.of Camden (organizing), a non-operating institu-tion and, as a contemporaneous transaction, toeffect the merger of Third National Bank & TrustCo. of Camden and Fourth National Bank & TrustCo. of Camden (organizing). The effect of thesetransactions will be transfer control of an existingbank to a registered bank holding company. Inand of itself, however, the proposed merger wouldmerely combine an existing bank with a non-operat-ing institution; as such, and without regard toacquisition of the surviving bank by United JerseyBanks, the proposed merger would have no effecton competition.

BANK OF THE SOUTHWEST NATIONAL ASSOCIATION, HOUSTON, TEX., AND SOUTHWEST BANK, N.A., HOUSTON, TEX.


Banking offices

Inoperation

To beoperated

Bank of the Southwest National Association, Houston, Houston, Tex. (8645),withand Southwest Bank, National Association, Houston, Tex. (8645), which had. . .merged Dec. 10, 1970, under charter of the latter bank (8645) and title "Bank ofthe Southwest National Association, Houston." The merged bank at date of mer-ger had

$763,638,469261,392

763,638,469


On January 21, 1970, the Southwest Bank, Na-tional Association (organizing), Houston, Tex.,applied to the Office of the Comptroller of theCurrency for permission to merge with the Bank ofthe Southwest National Association, Houston, Tex.,under the charter of the former and with the titleof the latter.

The Bank of the Southwest, the merging bank,is located in Houston, Tex., a city of 1.1 million.The bank was chartered in 1907, and presently hasIPC deposits of $441 million.

The Southwest Bank, National Association,owned by Southwest Bancshares, Inc., is beingorganized as a means to transfer ownership of themerging bank to the holding company. Prior to

172


the merger, the organizing bank will not be op-erational. With the exception of the directors'qualifying shares, all of the shares of the resultingbank will be owned by Southwest Bancshares, Inc.

Because the merging bank is the only operatingbank in the proposed transaction, there can beno adverse effect on competition resulting fromconsummation of the proposed merger. The re-sulting bank will continue to conduct the mergingbank's business at the present location under title

of the Bank of the Southwest National Association.The application is, therefore, approved.


The proposed merger is part of a transactionwhich will result in Bank of the Southwest NationalAssociation, Houston, becoming a wholly-ownedsubsidiary of a one-bank holding company. Thus,this merger is merely part of a corporate reorganiza-tion and as such will have no effect on competition.

T H E FIRST NATIONAL BANK AT EAST PALESTINE, EAST PALESTINE, OHIO, AND EAST PALESTINE NATIONAL BANK,EAST PALESTINE, OHIO


The First National Bank at East Palestine, East Palestine, Ohio (13850), with. . .and East Palestine National Bank, East Palestine, Ohio (13850), which hadmerged Dec. 16, 1970, under charter of the latter bank (13850) and title "TheFirst National Bank at East Palestine." The merged bank at date of merger had. .

Total assets

$10,101,092120,000

10,331,092

Banking offices

Inoperation

30

To beoperated

3


On September 17, 1970, The First National Bankat East Palestine, East Palestine, Ohio, and EastPalestine National Bank (organizing), EastPalestine, Ohio, applied to the Comptroller of theCurrency for permission to merge under the charterof the latter and with the title of the former.

The First National Bank at East Palestine, withIPC deposits of $9.2 million, was organized in 1933.It currently operates two branch offices, one in EastPalestine and one in Negley, both in ColumbianaCounty.

East Palestine National Bank is being organizedto provide a vehicle to transfer ownership of TheFirst National Bank at East Palestine to BancOhioCorporation. East Palestine National Bank willnot be operating as a commercial bank prior to themerger.

Because The First National Bank at East Pales-tine is the only operating bank involved in theproposed transaction, there can be no adverse effecton competition resulting from consummation ofthe proposed merger.

Applying the statutory criteria, it is concludedthat the proposed merger is the public interest. Theapplication is, therefore, approved.

NOVEMBER 16, 1970.


The proposed merger is part of a plan underwhich BancOhio Corporation, a registered bankholding company, proposes to acquire all of thevoting shares of East Palestine National Bank (or-ganizing), a non-operating institution and, as acontemporaneous transaction, to effect the mergerof First National Bank at East Palestine and EastPalestine National Bank (organizing). The effect ofthese transactions will be to transfer control of anexisting bank to a registered bank holding com-pany. In and of itself, however, the proposed mergerwould merely combine an existing bank with a non-operating institution; as such, and without regardto acquisition of the surviving bank by BancOhioCorporation, the proposed merger would have noeffect on competition.

173


CITY NATIONAL BANK, HACKENSACK, N.J., AND FIRST NATIONAL STATE BANK OF NORTH JERSEY, HACKENSACK, N J .


City National Bank, Hackensack, N J . (12014), withand First National State Bank of North Jersey, Hackensack, N J . (12014), whichhadmerged Dec. 21, 1970, under charter and title of the latter bank (12014). Themerged bank at date of merger h a d . . . .

Total assets

$54,804,637

124,000

54,808,637

Banking offices

Inoperation

3

0

To beoperated

3


On September 25, 1970, City National Bank,Hackensack, N.J., and First National State Bank ofNorth Jersey (organizing), Hackensack, N.J., ap-plied to the Comptroller of the Currency for per-mission to merge under the charter and with thetitle of the latter.

City National Bank, the merging bank, is head-quartered in Hackensack, N.J., and has two operat-ing branches, one located in Hackensack and onein Little Ferry; and one approved but unopenedbranch located in Wallington. All offices are locatedin Bergen County. This bank, with total resourcesof $45.4 million, and total IPC deposits of $37.7million, was chartered originally in 1921.

First National State Bank of North Jersey, thecharter bank, is being organized to provide a vehicleto transfer ownership of the merging bank to FirstNational Bancorporation. The charter bank willnot be operating as a commercial bank prior to themerger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. The

resulting bank will conduct the same banking busi-ness at the same locations and with the same nameas presently used by the merging bank.


NOVEMBER 2, 1970.


The proposed merger is part of a plan underwhich First National State Bancorporation, a reg-istered bank holding company, proposes to acquireall of the voting shares of First National State Bankof North Jersey (organizing), a non-operating insti-tution and, as a contemporaneous transaction, toeffect the merger of City National Bank and FirstNational State Bank of North Jersey (organizing).The effect of these transactions will be to transfercontrol of an existing bank to a registered bankholding company. In and of itself, however, theproposed merger would merely combine an existingbank with a non-operating institution; as such, andwithout regard to acquisition of the surviving bankby First National State Bancorporation, the pro-posed merger would have no effect on competition.

FIRST NATIONAL BANK OF SPRING LAKE, SPRING LAKE, N.J., AND FIRST NATIONAL STATE BANK OF SPRING LAKE,SPRING LAKE, N J .


First National Bank of Spring Lake, Spring Lake, NJ. (13898), withand First National State Bank of Spring Lake, Spring Lake, NJ. (13898), whichhadmerged Dec. 21, 1970, under charter and title of the latter bank (13898). Themerged bank at date of merger had

Total assets

$21,992,135

125,000

21,992,135

Banking offices

Inoperation

2

0

To beoperated

2

174



On September 25, 1970, First National Bank ofSpring Lake, Spring Lake, N.J., and First NationalState Bank of Spring Lake (organizing), SpringLake, N.J., applied to the Comptroller of the Cur-rency for permission to merge under the charter andwith the title of the latter.

First National Bank of Spring Lake, the mergingbank, is headquartered in Spring Lake, and hasone branch which is located in Sea Girt. This bank,with total resources of $19.6 million and IPC de-posits of $17.1 million, was chartered originally in1933.

First National State Bank of Spring Lake, thecharter bank, is being organized to provide a vehicleto transfer ownership of the merging bank to theFirst National State Bancorporation. The charterbank will not be operating as a commercial bankprior to the merger.




NOVEMBER 2, 1970.


The proposed merger is part of a plan underwhich First National State Bancorporation, a reg-istered bank holding company, proposes to acquireall of the voting shares of First National State Bankof Spring Lake (organizing), a non-operating insti-tution and, as a contemporaneous transaction, toeffect the merger of First National Bank of SpringLake, and First National State Bank of Spring Lake(organizing). The effect of these transactions will beto transfer control of an existing bank to a regis-tered bank holding company. In and of itself, how-ever, the proposed merger would merely combinean existing bank with a non-operating institution;as such, and without regard to acquisition of thesurviving bank by First National State Bancorpora-tion, the proposed merger would have no effecton competition.

THE EDISON BANK, SOUTH PLAINFIELD, N.J., AND THE EDISON BANK, N.A., SOUTH PLAINFIELD, N.J.

The Edison Bankand The Edisonwhich hadmerged Dec. 21,merged bank at c


South Plainfield, NJ. (15845), withBank, National Association, South Plainfield,

1970, under charter and title of the latter bankate of merger had. .

NJ. (15845),

(15845). The

Total assets

$74,017

140

74,021

,262

000

,762

Banking offices

Inoperation

9

0

To beoperated

9


On September 25, 1970, The Edison Bank, SouthPlainfield, N.J., and The Edison Bank, N.A. (or-ganizing), South Plainfield, N.J., applied to theComptroller of the Currency for permission tomerge under the charter and with the title of thelatter.

The Edison Bank, the merging bank, is head-quartered in South Plainfield, and has eightbranches located in Middlesex County. This bank,with total resources of $68.3 million, and IPC de-posits of $53.3 million, was chartered originally in1956.

The Edison Bank, N.A., the charter bank, isbeing organized to provide a vehicle to transferownership of the merging bank to the First Na-tional State Bancorporation. The charter bank willnot be operating as a commercial bank prior to themerger.

Because the merging bank is the only operatingbank involved in the proposed transaction, therecan be no adverse effect on competition resultingfrom consummation of the proposed merger. Theresulting bank will conduct the same bankingbusiness at the same locations and with the samename as presently used by the merging bank.

175



NOVEMBER 2, 1970.


The proposed merger is part of a plan underwhich First National State Bancorporation, a reg-istered bank holding company, proposes to acquireall of the voting shares of Edison Bank, N.A. (or-ganizing), a non-operating institution and, as a

contemporaneous transaction, to effect the mergerof Edison Bank and Edison Bank, N.A. (org.).The effect of these transactions will be to transfercontrol of an existing bank to a registered bankholding company. In and of itself, however, theproposed merger would merely combine an exist-ing bank with a non-operating institution; as such,and without regard to acquisition of the survivingbank by First National State Bancorporation, theproposed merger would have no effect on competi-tion.

THE WARREN COUNTY NATIONAL BANK, WASHINGTON, N.J., AND THE SECOND WARREN COUNTY NATIONAL BANK,WASHINGTON, N J .


The Warren County National Bank, Washington, NJ. (860), withand The Second Warren County National Bank, Washington, NJ. (860), whichhadmerged Dec. 21, 1970, under charter of the latter bank (860) and title "TheWarren County National Bank." The merged bank at date of merger had

Total assets

$40,272,832

126,501

40,399,333

Banking offices

Inoperation

3

0

To beoperated

3


On January 8, 1970, The Warren County Na-tional Bank, Washington, N.J., and The SecondWarren County National Bank (organizing), Wash-ington, N J., applied to the Comptroller of the Cur-rency for permission to merge under the charter ofthe latter and with the title of the former.

The Warren County National Bank, the mergingbank, is headquarterd in Washington, and pres-ently has two branch offices located in Hacketts-town, NJ. This bank, with total resources of $34.8million, and IPC deposits of $29.2 million, waschartered originally in 1865.

The Second Warren County National Bank, thecharter bank, is being organized to provide a ve-hicle to transfer ownership of the merging bank tothe First National State Bancorporation. The char-ter bank will not be operating as a commercial bankprior to the merger.



Applying the statutory criteria, it is concludedthat the proposed merger is in the public interestand the application is, therefore, approved.OCTOBER 27, 1970.


The proposed merger is part of a plan underwhich First National State Bancorporation, aproposed registered bank holding company, pro-poses to acquire all of the voting shares of SecondWarren County National Bank, a non-operatinginstitution, and to effect the merger of WarrenCounty National Bank and Second Warren CountyNational Bank. The effect of these transactions willbe to transfer control of an existing bank to a regis-tered bank holding company. In and of itself, how-ever, the proposed merger would merely combinean existing bank with a non-operating institution;as such, and without regard to acquisition of thesurviving bank by First National State Bancorpora-tion, the proposed merger would have no effect oncompetition.

176


///. Additional Approvals

A. Approved, but in litigation.

CATAMOUNT NATIONAL BANK, NORTH BENNINGTON, VT. , AND THE COUNTY NATIONAL BANK OFBENNINGTON, BENNINGTON, V T .


Catamount National Bank, North Bennington, Vt. (194), withand The County National Bank of Bennington, Bennington, Vt. (2395), whichhadapplied for permission to consolidate July 15, 1970, under charter of the latterbank (2395) and title "Catamount National Bank." The application was approvedOct. 9, 1970. The pending consolidation was challenged by Justice DepartmentNovember 5, 1970, and is presently in litigation.

Total assets

$20,893,674

17,548,669

Banking offices

Inoperation

4

2

To beoperated


On July 15, 1970, Catamount National Bank,North Bennington, Vt., and The County NationalBank of Bennington, Bennington, Vt., applied tothe Office of the Comptroller of the Currency forpermission to consolidate under the charter of thelatter and with the title of the former.

The County National Bank of Bennington, thecharter bank, with IPC deposits of $14.5 million,was organized in 1878. In addition to its head office,this bank has a branch office in Arlington which islocated in the central portion of BenningtonCounty, approximately 15 miles north of the townof Bennington.

Catamount National Bank, the consolidatingbank, with IPC deposits of $17.5 million, was or-ganized in 1864. In addition to its head officelocated in North Bennington, it operates an in-stallment loan branch in a shopping center a shortdistance from its North Bennington headquarters; abranch in Manchester, in the northern portion ofBennington County approximately 11 miles aboveArlington; and a branch in Brattleboro, approxi-mately 40 miles east of Bennington, in WindhamCounty.

The service areas of the two banks, althoughappearing to overlap, are not coextensive. Thenatural market area of the combined bank would beBennington and Windham, the two southernmostcounties in Vermont, and abutting fringe areas ofadjacent States and counties. Catamount NationalBank had substantial deposits and loans from Man-chester, Brattleboro, and other areas in Vermont.

Any new business it seeks must come in large meas-ure from beyond the southwest corner of Vermont;Catamount National Bank vigorously solicits busi-ness in the border areas of the State of New Yorkand in the northwest area of Massachusetts.

The population of the area served by these banksis estimated at 79,000, of which 32,500 reside inWindham County. Bennington has a population of14,000, Brattleboro, 15,000, and Manchester, 2,500.The economy of the western, or Greater Benning-ton portion of the service area is well diversified,with 40 industries producing a wide assortment ofproducts. It also has the usual service and supportestablishments. In the eastern, or Brattleboro area,situated along the New Hampshire border, manu-facturing, retail trade, and agriculture all contributesignificantly. In both areas, recreation and inducedeconomic activity are important income producingfactors. Restaurants, gift shops, and motels arefound in profusion throughout the market area,and the vacation homes industry has been thrivingin recent years.

Chief banking competition for the consolidatingbanks stems from two Brattleboro-based banks, bothof which operate branches in Bennington. Thosebanks, two of the largest banks in the State, arethe Vermont Bank & Trust Company, with depositsof $70.2 million, and the Vermont National Bank,with deposits of $65.4 million. In the combinedservice areas of the consolidating banks there are24 different commercial banks, ranging in size fromthe National Commercial Bank and Trust Com-pany and the State Bank of Albany, each with over

177


$800 million in assets, to the Cambridge ValleyNational Bank, with only $5.4 million in assets. Theconsolidating banks rank 12th and 14th in size,and after their consolidation would rank 10th. Inaddition, a number of mutual savings banks, sav-ings and loan associations, industrial banks, insur-ance companies, credit unions, finance companies,personal loan companies, and several lending agen-cies of the Federal Government also do business inthe area.

The consolidation of these two banks will nothave an adverse effect on competition. Since theservices which the two offer are more complemen-tary than competitive, their combination will nothave a significant impact on the market structure.While their service areas overlap, they are notcoextensive. The Catamount National Bank, forexample, operates a branch in Brattleboro, andCounty National does not. In downtown Benning-ton, the Catamount National Bank has very littlebusiness and does not compete to any great extentwith the County National Bank because three bank-ing offices, including offices of the two largest banksin southern Vermont, Vermont Bank and TrustCompany, and Vermont National Bank, are stra-tegically and conveniently located. A third largebank in the area, such as will result from this con-solidation, will doubtlessly enhance competition inthe area, providing a greater challenge to the Ver-mont National Bank and the Vermont Bank andTrust Company, and will bring better services andso benefit the entire community. Because of themany banking outlets presently operating in thearea, the elimination of one independent bankingsource will have a negligible effect.

This consolidation is necessary to enable bothbanks to deal with such problems as the need forlarger lending limits, the recruitment of personnelwith specialized skills, and, particularly, the prob-lem of holding management personnel with spe-cial skills. Even more important, the consolidationis necessary to allow these banks to obtain enoughmuscle to withstand the inroads of the larger bankscanvassing the area for business and seeking newbanking outlets. The consolidation of these twobanks is a better competitive solution than an in-crease in concentration among the larger banks.

Applying the statutory criteria, we conclude that

the proposal is in the public interest. The appli-cation is, therefore, approved.

OCTOBER 9, 1970.


The head offices of the applicant banks arelocated about 5 miles apart, with only one bankin the intervening area. It appears that the pro-posed merger will eliminate substantial direct com-petition between County National and CatamountNational in Bennington County.

Bennington County is presently served by fivebanks operating 10 banking offices. As of June 30,1968, the three leading banks in the county heldabout 75 percent of the total deposits in the county.Catamount National and County National heldthe second and third leading positions in thecounty, with 24.4 percent and 24.1 percent of totalcounty deposits, respectively. The resulting bankwould hold by far the dominant position in thecounty, with 48.5 percent of the total county de-posits, and 50 percent of the county's bankingoffices. Its share of county deposits would be twicethat of its closest competitor.

Even these substantial concentration statisticsmay understate the competitive effects of thismerger, for its major impact would be in theservice area of County National, which, accordingto the application, is limited to the southern sec-tion of Bennington County. As of June 30, 1968,Catamount National and County National held30.7 percent and 30.3 percent, respectively, of thetotal deposits in this area. If the proposed mergeris approved, the resulting bank will operate four ofthe seven banking offices there, and will hold about61 percent of area deposits, again twice that of itsclosest competitor.

According to the application, competing com-mercial banks in nearby states provide someamount of banking competition in southern Ben-nington County. It is unlikely, however, that thesebanks draw sufficient business from the area tosubstantially reduce the marked increase in con-centration in commercial banking that would re-sult from the proposed merger.

For these reasons, we conclude that the proposedmerger would have a significantly adverse effect oncompetition.

178


B. Approved, but consummation deferred due to related litigation.

THE PEOPLES NATIONAL BANK OF MANASSAS, MANASSAS, V A . , AND MANASSAS BANK, N.A., MANASSAS, V A .


The Peoples National Bank of Manassas, Manassas, Va. (6748), withand Manassas Bank, N.A., Manassas, Va. (6748), which hadapplied for permission to merge August 1, 1969, under charter of the latter bank(6748) and title "United Virginia Bank /Peoples National." The application wasapproved Feb. 2, 1970, but consummation was deferred due to related litigation.

Total assets

$22,086,934125,000

Banking offices

Inoperation

40

To beoperated


On August 1, 1969, the Peoples National Bankof Manassas, Manassas, Va., and Manassas Bank,N.A., (organizing), Manassas, Va., applied to theComptroller of the Currency for permission tomerge under the charter of the latter and with thetitle "United Virginia Bank/Peoples National."

The Peoples National Bank of Manassas, themerging bank, is headquartered in Manassas, Va.,and operates five offices. This bank, with depositsof $18 million, was organized in 1903.

Manassas Bank, N.A., the charter bank, is beingorganized to provide a vehicle to transfer owner-ship of the merging bank to United VirginiaBankshares holding company. The charter bankwill not be operating as a commercial bank priorto the merger. Because the merging bank is theonly operating bank involved in the proposed trans-action, there can be no adverse effect on com-petition resulting from confirmation of the pro-posed merger. The resulting bank will conductthe same banking business at the same locations.


FEBRUARY 2, 1970.


The proposed merger is part of a plan underwhich United Virginia Bankshares, Inc., a regis-tered bank holding company, proposes to acquireall of the voting shares of Manassas Bank, N.A.,a non-operating institution, and as a contemporane-ous transaction, to effect the merger of The Peo-ples National Bank of Manassas into ManassasBank, N.A. The effect of these transactions will beto transfer control of an existing bank to a regis-tered bank holding company. In and of itself,however, the proposed merger would merely com-bine an existing bank with a non-operating institu-tion; as such, and without regard to acquisitionof the surviving bank by United Virginia Bank-shares, Inc., the proposed merger would have noeffect on competition.

179


APPENDIX B

Statistical Tables


Statistical Tables


B-l Comptrollers of the Currency, 1863 to the pres-ent 183

B—2 Administrative Assistants to the Comptroller ofthe Currency and Deputy Comptrollers of theCurrency 184

B-3 Regional Administrators of National b a n k s . . . . 185B-4 Changes in the structure of the National Banking

System, by States, 1863-1970 186B—5 Charters, liquidations, and changes in issued

capital stock of National banks, calendar 1970. 187B—6 Applications for National bank charters, ap-

proved and rejected, by States, calendar 1970. 188B-7 Applications for National bank charters, by

States, pursuant to corporate reorganization,calendar 1970 189

B—8 Newly organized National banks, by States,calendar 1970 190

B-9 National bank charters issued and mergers con-summated pursuant to corporate reorganiza-tions, by States, calendar 1970 192

B-10 State-chartered banks converted to Nationalbanks, calendar 1970 195

B-l 1 National bank charters issued pursuant to corpo-rate reorganizations, by States, calendar 1970. 196

B-l 2 National banks reported in voluntary liquida-tion, calendar 1970 197

B-l 3 National banks merged or consolidated withState banks, calendar 1970 197

B-l4 National banks converted into State banks,calendar 1970. 198

B-l5 Purchases of State banks by National banks,calendar 1970 199

B-l6 Consolidations of National banks, or Nationaland State banks, calendar 1970 199

B-l 7 Mergers of National banks, or National andState banks, by States, calendar 1970 201

B-l8 Mergers resulting in National banks, by assets ofacquiring and acquired banks, 1960-1970 208

B-l9 Domestic branches entering the National Bank-ing System, by de novo opening, merger, orconversion, by States, calendar 1970 209

B-20 Domestic branches of National banks closed, byStates, calendar 1970 219


B-21 Outstanding balances, credit cards and relatedplans of National banks, Dec. 31, 1970 221

B-22 Principal assets, liabilities, and capital accountsof National banks, by deposit size, year-end1969 and 1970 222

B-23 Dates of reports of condition of National banks,1914-70 223

B-24 Total and principal assets of National banks, byStates, June 30, 1970 225

B-25 Total and principal liabilities of National banks,by States, June 30, 1970 226

B-26 Capital accounts of National banks, by States,June 30, 1970 227

Br-27 Total and principal assets of National banks, byStates, Dec. 31, 1970 228

Br-28 Total and principal liabilities of National banks,by States, Dec. 31, 1970 229

B-29 Capital accounts of National banks, by States,Dec. 31, 1970 230

B-30 Loans of National banks, by States, Dec. 31,1970 231

B-31 Income and expenses of National banks, byStates, year ended Dec. 31, 1970 232

B-32 Income and expenses of National banks, bydeposit size, year ended Dec. 31, 1970 244

B-33 Capital accounts, net income, and dividends ofNational banks, 1944-70 246

B-34 Loan losses and recoveries of National banks,1945-70 247

B-35 Securities losses and recoveries of Nationalbanks, 1945-70 247

B—36 Assets and liabilities of National banks, date oflast report of condition, 1950-70 248

B—37 Foreign branches of National banks, by regionand country, Dec. 31, 1970 249

B-38 Total assets of foreign branches of Nationalbanks, year-end, 1953-70 250

B-39 Foreign branches of National banks, 1960-70.. . 250B-40 Assets and liabilities of National banks, Dec. 31,

1970: consolidated statement 250B-41 Trust assets and income of National banks, by

States, calendar 1970. . 251

182


TABLE B-l

Comptrollers of the Currency, 1863 to the present

No. Name Date ofappointment

Date ofresignation

State

123456789

10111213141516171819202122

McCulloch, HughClarke, FreemanHulburd, Hiland RKnox, John JayCannon, Henry W. . . .Trenholm, William L. .Lacey, Edward SHepburn, A. BartonEckels, James HDawes, Charles GRidgely, William BarretMurray, Lawrence O. .Williams, John Skelton.Crissinger, D. RDawes, Henry MMclntosh, Joseph W. . .Pole, John WO'Connor, J. F. TDelano, PrestonGidney, Ray MSaxon, James JCamp, William B

May 9, 1863Mar. 21, 1865Feb. 1, 1867Apr. 25, 1872May 12, 1884Apr. 20, 1886May 1, 1889Aug. 2, 1892Apr. 26, 1893Jan. 1, 1898Oct. 1, 1901Apr. 27, 1908Feb. 2, 1914Mar. 17, 1921May 1, 1923Dec. 20, 1924Nov. 21, 1928May 11, 1933Oct. 24, 1938Apr. 16, 1953Nov. 16, 1961Nov. 16, 1966

Mar.JulyApr.Apr.Mar.Apr.JuneApr.Dec.Sept.Mar.Apr.Mar.Apr.Dec.Nov.Sept.Apr.Feb.Nov.Nov.

8, 186524, 18663, 1872

30, 18841, 1886

30, 188930, 189225, 189331, 189730, 190128, 190827, 19132, 192130, 192317, 192420, 192820, 193216, 193815, 195315, 196115, 1966

IndianaNew YorkOhioMinnesotaMinnesotaSouth CarolinaMichiganNew YorkIllinoisIllinoisIllinoisNew YorkVirginiaOhioIllinoisIllinoisOhioCaliforniaMassachusettsOhioIllinoisTexas

183


TABLE B-2

Administrative Assistants to the Comptroller of the Currency and Deputy Comptrollers of the Currency

Name Dates of tenure State

ADMINISTRATIVE ASSISTANTS TO THE COMPTROLLER

Larsen, Arnold EFaulstich, Albert JChase, Anthony GWickman, Wayne GNicoll, JohnHowland, Jr., W. A

DEPUTY COMPTROLLERS OF THE CURRENCY

Howard, Samuel THulburd, Hiland RKnox, John JayLangworthy, John SSnyder, V. PAbrahams, J. DNixon, R. MTucker, Oliver PCoffin, George MMurray, Lawrence OKane, Thomas PFowler, Willis JMclntosh, Joseph WCollins, Charles WStearns, E. WAwait, F. GGough, E. HProctor, John LLyons, GibbsPrentiss, William, JrDiggs, Marshall ROppegard, G. JUpham, C. BMulroney, A. JMcCandless, R. BSedlacek, L. HRobertson, J. LHudspeth, J. WJennings, L. ATaylor, W. MGarwood, G. WFleming, Chapman CHaggard, Hollis SCamp, William BRedman, Clarence BWatson, Justin TMiller, Dean EDeShazo, Thomas GEgertson, R. ColemanBlanchard, Richard JPark, RadcliffeFaulstich, Albert JMotter, David CGwin, John D

Dec. 24, 1961July 2, 1962July 21, 1965Feb. 27, 1967Aug. 19, 1968Dec. 1, 1969

MayAug.Mar.Aug.Jan.Jan.Aug.Apr.Mar.Sept.JuneJulyMayJulyJan.JulyJulyDec.Jan.Feb.Jan.Jan.Oct.MayJulySept.Oct.Jan.Sept.Mar.Feb.Sept.MayApr.Aug.Sept.Dec.Jan.JulySept.Sept.JulyJulyFeb.

9, 18631, 186512, 18678, 18725, 1886

27, 188711, 18907, 189312, 18961, 1898

29, 18991, 1908

21, 19231, 19236, 19251, 19276, 19271,1928

24, 193324, 193616,193816,1938

1938193919411941194419491950

1, 195118,195215,195916, 19602, 19624, 19623, 1962

23, 19621, 1963

13, 19641, 19641, 1964

19, 19651, 1966

21, 1967

July 1, 1962July 18, 1965Feb. 25, 1967Aug. 17, 1968Nov. 28, 1969

Aug.Jan.Apr.Jan.Jan.MayMar.Mar.Aug.JuneMar.Feb.Dec.JuneNov.Feb.Oct.Jan.Jan.Jan.Sept.Sept.Dec.Aug.Mar.Sept.Feb.Aug.MayApr.Dec.Aug.Aug.Nov.Oct.

1, 186531, 186724, 18723, 18863, 1887

25, 189016,189311, 189631, 189827, 18992,1923

14, 192719, 192430, 192730, 192815, 193616,194123, 193315, 193815, 193830, 193830, 193831, 194831, 1941

1, 195130, 194417, 195231, 195016, 19601, 1962

31, 196231, 1962

3, 196215, 196626, 1963

June 30, 1966

June 1, 1967

Nebraska.Louisiana.Washington.Texas.New York.Georgia.

New York.Ohio.Minnestoa.New York.New York.Virginia.Indiana.Kentucky.South Carolina.New York.Dist. of Columbia.Indiana.Illinois.Illinois.Virginia.Maryland.Indiana.Washington.Georgia.California.Texas.California.Iowa.Iowa.Iowa.Nebraska.Nebraska.Texas.New York.Virginia.Colorado.Ohio.Missouri.Texas.Connecticut.Ohio.IowaVirginia.Iowa.Massachusetts.Wisconsin.Louisiana.Ohio.Mississippi.

184


TABLE B-3

Regional Administrators of National banks

Region

1

2345

6789

1011121314

Name

John L. Donovan

Charles M. Van HornR. Goleman EgertsonJohn W. Shaffer, JrPage Granford

Joseph M. ReamJoseph G. LutzKenneth W. LeafDonald B. SmithJohn R. BurtMichael DomanJohn R. ThomasH.JoeSelbyArnold E. Larsen

Headquarters

Boston, Mass

New York, N.YPhiladelphia, PaCleveland, OhioRichmond, Va

Atlanta, GaChicago, 111Memphis, TennMinneapolis, MinnKansas City, MoDallas, TexDenver, ColoPortland, OregSan Francisco, Calif

States

Connecticut, Maine, Massachusetts, New Hampshire,Rhode Island, Vermont.

New Jersey, New York.Pennsylvania, Delaware.Indiana, Kentucky, Ohio.District of Columbia, Maryland, North Carolina, Virginia,

West Virginia.Florida, Georgia, South Carolina.Illinois, Michigan.Alabama, Arkansas, Louisiana, Mississippi, Tennessee.Minnesota, North Dakota, South Dakota, Wisconsin.Iowa, Kansas, Missouri, Nebraska.Oklahoma, Texas.Arizona, Colorado, New Mexico, Utah, Wyoming.Alaska, Idaho, Montana, Oregon, Washington.California, Hawaii, Nevada.

185


TABLE B-4

Changes in the structure of the National Banking System, by States, 1863-1970

United States

AlabamaAlaskaArizonaArkansasC a l i f o r n i a . . . . .ColoradoConnecticutDelawareDistrict of ColumbiaFlorida

Georgia . . . .Hawaii . . . .IdahoIllinoisIndianaIowaKansasKentucky . .Louisiana. . . .Maine

MarylandMassachusettsMichiganMinnesotaMississippi . . .Missouri . . . . .MontanaNebraskaNevada

New Hampshire . . . .New JerseyNew MexicoNew YorkNorth CarolinaNorth Dakota . .OhioOklahomaOregon . . . .PennsylvaniaRhode Island

South CarolinaSouth DakotaTennesseeTexasUtah . . . .Vermont . . . .Virginia . . . .Washington . . .West Virginia . . . . . .WisconsinWyomingVirgin IslandsPuerto Rico

Organizedand opened

for business1863-1970

15,853

2048

331666082701373239

303

2097

112981450565459250122128

15738835551998

328206413

18

86459

971,026

163263725781153

1,29570

136224221

1,3444685

284244202303

7911

Consolidated and mergedunder 12 U.S.C. 215

Consoli-dated

710

4011

215

1108CM

CO

—

0201446

1148

3411185

13421

352

1126

83

32122

1073

8139

4543

2319119

oo

o

Merged

489

4002

4508001

202852CM

CM

C

8

15144046110

741

17322

020

53

972

1321803

47

o

oo

oo

oo

Insol-vencies

2,820

4506

396656

717

43

420

35227

98205

77371613

172877

11616587683

4

56025

13044

1001128531

2112

439336

1426

17285138541200

Liqui-dated

6,741

622

2155

3948669181342

874

652992052431981105379

6920715719335

14876

1998

2315237

44158

118336454103492

58

498194

574212974

14068

1152601

12 U.S.C. 214

Convertedto Statebanks

159

0010411000

811

122

115800

01O

CO

O

^

030

010

11002

22060

122

41311000

oo

o

Merged orconsolidatedwith State

banks

313

0110

180

15800

002141

O N

D O

1

11115001001

0240

7690604

830

302426

10100

oo

o

InoperationDec. 31,

1970

4,621

8953

6960

12226

511

215

6217

41412299

171804919

4286

101199389849

1254

4812933

1692242

217203

10299

5

193377

5301026

1012585

12541

10

186


TABLE B-5

Charters, liquidations, and changes in issued capital stock of National banks, calendar 1970

Increases:Banks newly chartered:

Primary organizationConversions of State banks

Capital stock:Preferred: 2 cases by new issueCommon:

443 cases by statutory sale669 cases by statutory stock dividends7 cases by statutory consolidation44 cases by statutory merger5 cases by conversion of preferred stock46 cases by conversion of capital notes

Capital notes and debentures: 67 cases by new issue. . .

Total increases

Decreases:Banks ceasing operations:

Voluntary liquidations:Succeeded by National banksSucceeded by State banks

Statutory consolidationsStatutory mergers. .Converted into State banksMerged or consolidated with State banksInsolvent

Capital stock:Preferred: 6 RetiredCommon:

4 cases by statutory reduction3 cases by statutory consolidation7 cases by statutory merger

Capital notes and debentures:46 Retirements46 Converted to common stock

Total decreases

Net changeCharters in force Dec. 31, 1969, and issued capital

Charters in force Dec. 31, 1970, and issued capital

Number ofbanks

•6412

76

438

f534181

118

-424,671

4,629

Capital stock

Common

$20,551,02011,579,514

30,324,840214,309,815

10,291,24018,645,995

14,0981,297,405

307,013,927

1,272,0004,450,000

16,188,4873,801,250625,000

1,952,9492,897,8003,464,188

34,651,674

272,362,253r6,165,757,000

6,438,119,253

Preferred

$300,000

300,000

79,366

79,366

220,634r62,453,000

62,673,634

Capital notes anddebentures

$69,480,500

69,480,500

543,700

9,576,9326,729,241

16,849,873

52,630,627r 1,119,738,000

1,172,368,627

* Includes 25 reorganized banks with capital stock of $4,453,520."("Includes 24 reorganized banks.r Revised.

NOTE: Premium on sale of common stock $107,494,392 (440 cases)Premium on convertible notes 5,431,839 ( 46 cases)

$112,926,231 (486 cases)

187


TABLE B-6Applications for National bank charters, approved and rejected, by States, calendar 1970*

Approved Rejected

ALABAMA

Hamilton June 4ARKANSAS

Metropolitan National Bank, Little Rock. . Apr. 1CALIFORNIA

Ventura Mar. 24Arcadia May 14

COLORADO

MINNESOTAApproved

Eden PrairieCarlton National Bank, Carlton Sept. 3DawsonBurnsville

MISSOURI

St. Louis. .Frontenac.

NEW JERSEY

Voorhees TownshipJefferson National Bank, Passaic Mar. 30

Fort Collins National Bank, Fort Collins. . Jan. 12Lakewood Apr. 8Unincorporated Area of Adams County Oct. 15 jenerson ixauonai i>anK rassaicSkyline National Bank, Denver . . Nov. 16 Tow^shf N a t l ° n a l B a n k ) B n d S e w a t e r

A f 2 2

Colorado Springs . Nov. 25 M i d j ^ P National" Bank,' Woodbridge **"A n-o i fi Township Apr. 24Aurora.. uec. 10 Woodbridge Township

FLORIDA Fairfield National Bank, Fairfield June 9Worth Avenue National Bank, Palm Burlington Township

Beach Jan. 16 P a n American National Bank, Union City. July 15Southeast National Bank of Orlando, Montville Township

- - - - Montville Township

Rejected

Aug. 18

Sept.'iiSept. 16

Feb. 10Dec. 16

Mar. 25

Orlando Jan. 21Security National Bank, Fort Myers Villas. Jan. 22Security First National Bank, Plantation. . Jan. 27First National Bank of Hallandale, Hallan-

NEW YORK

New YorkM a r \ 7 Oyster Bay

Lauderdale Lakes National Bank, Lauder- Universal National Bank, Hempstead. Aug. 3dale Lakes May 13 Vanguard National Bank, Hempstead

Apr. 24

June i8

Aug.'i8Aug. 18

July 16July 17

Midway National Bank, UnincorporatedArea of Dade County June 17 . . . . . . . . .

Charlotte County National Bank, PortCharlotte July 20

Port Charlotte July 20Orlando July 21Unincorporated Area of Dade County Sept. 11East First National Bank, Fort M y e r s . . . . Sept. 24Barnett Mall Bank, N.A., Winter Park. . . Oct. 6Sarasota Oct. 6Fort Lauderdale Nov. 25

Aug. 3

2325

Village.Westhampton Beach.

NORTH CAROLINA

Greensboro National Bank, Greensboro. . . May 12

TENNESSEE

Mountain CityTEXAS

People's National Bank of Spring Branch,Houston Feb. 16

First National Bank of Tomball, Tomball. Feb. 19San BenitoPromenade National Bank, Richardson. . . May 13Guaranty National Bank, Houston June 3Bergstrom Air Force BaseBergstrom Air Force BaseFarmers Branch

Nov. 25

Mar. 27

Village Bank (National Association),Dallas Sept. 17

GEORGIA

Warner Robins JulyMcDonough Nov.

ILLINOIS

Rolling Meadows May 11Suburban National Bank of Elk Grove

Village, Elk Grove Village May 11Tollway-Arlington National Bank of Ar-

N S 2 ? B 2 R ? I J * S U S * : \ \ \ ! J^Z 17 ! ! ! ! ! ! \ \ Brookhollow National Bank, Dallas Oct. 20Village of Schaumburg Nov. 12 Dallas

Montgomery CountyThe Village National Bank, Houston Dec. 17HoustonHouston

LOUISIANA

Kentwood Jan. 30MARYLAND

Gaithersburg Dec. 16MASSACHUSETTS

The Colonial National Bank of Danvers,

May 12

INDIANA

Midwest National Bank, Indianapolis. . . . Feb. 13

Oct. 20Oct. 20

VIRGINIA

Atlantic National Bank, Norfolk Mar. 26WASHINGTON

Dec. 17Dec. 17

Danvers Jan. 26

National Bank of Marshall, Marshall Jan. 16First National Bank of Bad Axe, Bad Axe. Mar. 31The Niles National Bank and Trust Com-

pany, Niles June 18Meridian National Bank, Meridian Town-

ship Aug. 7

Lynn woodOlympiaOlympia

Mar. 23June 26June 26

WEST VIRGINIA

Middletown National Bank, MiddletownMall, Route 250 South, Marion County. June 8

WISCONSIN

Hartland National Bank, Hartland July 24West AllisUniversity National Bank, Milwaukee. . . . Nov. 10

Sept. 16

•Excludes conversions, and charters to be issued pursuant to corporate reorganizations.

188


TABLE B-7

Applications for National bank charters, by States, pursuant to corporate reorganizations, calendar 1970

Approved Rejected

Jefferson County National Bank, Birming-ham Dec. 8

The Massachusetts Bank, National Asso-ciation, Boston Aug. 19

MICHIGAN

Warren National Bank, Warren Feb,

MISSOURI

24

American Bank of St. Joseph, NationalAssociation, St. Joseph July 23

Belt Bank of St. Joseph, National Associa-tion, St. Joseph July 23

First Bank of Joplin National Association,Joplin Oct. 19

The Second Sussex and Merchants National

30Cumberland County National Bank,

Bridgeton AprThe Fourth National Bank & Trust Com-

pany of Camden, New Jersey, Camden. Apr. 30Second Peoples National Bank of Mon-

mouth County, Hazlet Township Apr. 30

NEW JERSEY—continuedApproved Rejected

CALIFORNIA

The Concord National Bank, Concord. . . Mar. 23

LOUISIANA

NBC National Bank, New Orleans Sept. 9

MASSACHUSETTS

The National Bank of New Jersey, NewBrunswick, New Brunswick May 4

The Edison Bank, National Association,Borough of South Plainfield Aug. 5

First National State Bank of Spring Lake,Spring Lake Aug. 5

Second Citizens National Bank of SouthJersey, Borough of Woodbine Aug. 7

First National State Bank of North Jersey,Hackensack Aug. 17

Second New Jersey National Bank,Trenton Nov. 13

NEW YORK

Bank of Ithaca, National Association,Ithaca Aug. 26

OHIO

The F.B.G. National Bank of Dover,

Locust National Bank, St. Louis June 16 „ D o £ e V ' ". • ' VT* V ' •; « ' Y "v " V i " ' J a n * 8

A « — : ™ . n—i, ~f c* T ™ ~ U T\T«*™O1 East Palestine National Bank, East Pales-tine Aug 3

The F.B.G. National Bank of Wapakoneta,Wapakoneta Nov. 4

The F.B.G. National Bank of Portsmouth,Portsmouth Nov. 10

The F.B.G. National Bank of Wooster,Wooster Nov. 12NEW JERSEY

Second Raritan Valley National Bank, TEXAS— " ~ • • F e b 1 3 ^ ^ *T • , A . .

j? , ' ,„ Southwest Bank, National Association,* e b - l6 Houston Jan. 9

B W N xanaiviercnams^auonai Commerce Bank National Association,Bank of Newton, Newton Feb. 17 Houston Nov. 24

Second Southwest National Bank of ElPaso, El Paso Dec. 16

VIRGINIA

Bank of Williamsburg, N.A., Williamsburg. Nov. 4

189


TABLE B-8

Newly organized National banks, by States, calendar 1970*

CharterNo.

Title and location of bank Total capitalaccounts

15836

15815

157871582615778158031581415782

15794

1582415843

158401580115822

158251577915800

15850

15793

15781158351583915838

Total, United States: 39 banks.

ARKANSAS

Metropolitan National Bank, Little Rock.

COLORADO

First National Bank in Aspen, Aspen.

FLORIDA

Second National Bank of Delray Beach, Delray Beach. . .Eglin National Bank, Fort Walton BeachCitizens First National Bank of Citrus County, Inverness.Central Park First National Bank, OrlandoSoutheast National Bank of Orlando, OrlandoCongress National Bank, Palm Springs

Total: 6 banks.

First National Bank of Doraville, Doraville.

Peoples National Bank of Springfield, Springfield.National Bank of Urbana, Urbana

Total: 2 banks.

MICHIGAN

First National Bank of Bad Axe, Bad AxeFirst Independence National Bank of Detroit, Detroit.The Niles National Bank and Trust Company, Niles. .

Total: 3 banks.

MINNESOTA

Carlton National Bank, CarltonPark-Grove National Bank, Cottage GroveSuburban National Bank of Roseville, Roseville.

Total: 3 banks.

MISSISSIPPI

First National Bank of Lucedale, Lucedale.

Springfield National Bank, Springfield.

NEW JERSEY

Atlantic National Bank, Atlantic City. .Jefferson National Bank, Passaic. .The First National Bank, Piscataway, Piscataway Township.•» —-» « v 1WT _i_ * 1 Ti 1 TAT 11 * J f • i | •Mid-Jersey National Bank, Woodbridge Township

Total: 4 banks.

$34,946,000

1,250,000

300,000

750,000750,000625,000500,000

2,000,000750,000

5,375,000

600,000

500,000500,000

1,000,000

500,0001,500,0001,001,000

3,001,000

350,000500,000

1,500,000

2,350,000

250,000

750,000

3,000,0001,500,0001,500,0002,000,000

8,000,000

See footnote at end of table.

190


TABLE B-8—Continued

Newly organized National banks, by States, calendar 1970*

CharterNo.

Title and location of bank Total capitalaccounts

158321582015834158021581215818158331580915827

15819

1584215810

15823157851583715831

TEXASBank of Harris County, N.A., AldineAmerican National Bank, Corpus ChristiGuaranty National Bank, HoustonHouston Intercontinental National Bank, HoustonMadison-Southern National Bank, HoustonPan American National Bank, HoustonPeoples National Bank of Spring Branch, HoustonAmerican National Bank, HumbleFirst National Bank of Tomball, Tomball

Total: 9 banks

VIRGINIA

Jefferson National Bank, Lynchburg

WEST VIRGINIA

Middletown National Bank, Middletown Mall

The Suncrest National Bank, Morgantown

Total: 2 banks

WISCONSIN

Southridge National Bank of Greendale, GreendaleTri-City National Bank of Hales Corners, Hales Corners. . .Hartland National Bank, Hartland VillageFirst Wisconsin National Bank of West Towne, Madison. . .

Total: 4 banks

$ 1,000,000800,000

1,000,000600,000720,000

1,000,0001,000,000

500,000500,000

7,120,000

1,500,000

500,000750,000

1,250,000

600,000500,000500,000600,000

2,200,000

*Excludes charters issued pursuant to corporate reorganizations.

191


TABLE B-9

National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1970

Effective dateof merger

June 18, 1970

Tuly 1, 1970

Apr. 30, 1970

May 1, 1970

Jan. 14, 1970

June 12, 1970

June 12, 1970

June 12, 1970

Sept. 30, 1970

Operating bankNew bank

Resulting bank

MASSACHUSETTS

New England Merchants National Bank of Boston, BostonNew England Merchants Bank (National Association), Boston

Charter issued June 15, 1970

New England Merchants National Bank, Boston

MICHIGAN

First National Bank of Warren, WarrenWarren National Bank, Warren


First National Bank of Warren, Warren

MISSOURI

The Citizens National Bank of Chillicothe, ChillicotheChillicothe National Bank, Chillicothe

Charter issued April 21, 1970

The Citizens National Bank of Chillicothe, Chillicothe

The First National Bank of St. Joseph, St. JosephFirst National Bank of Buchanan County, St. Joseph


The First National Bank of St. Joseph, St. Joseph

NEW JERSEY

First National State Bank of New Jersey, NewarkNational State Bank of New Jersey, Newark

Charter issued January 12, 1970

First National State Bank of New Jersey, Newark

Raritan Valley National Bank, Edison TownshipSecond Raritan Valley National Bank, Edison Township


Raritan Valley National Bank, Edison Township

National Newark & Essex Bank, NewarkEssex Bank, National Association, Newark


National Newark & Essex Bank, Newark

The Sussex and Merchants National Bank of Newton, NewtonThe Second Sussex and Merchants National Bank of Newton, Newton


The Sussex and Merchants National Bank of Newton, Newton

The Cumberland National Bank of Bridgeton, BridgetonCumberland County National Bank, Bridgeton

Charter issued September 28, 1970

The Cumberland National Bank of Bridgeton, Bridgeton

Totalcapitalaccounts

$69,257,415

2,134,556

2,801,472

5,603,826

75,602,053

1,685,283

57,339,828

3,342,532

3,490,963

Totalassets

$937,069,917

25,604,056

39,230,582

61,573,596

837,629,610

24,812,416

694,623,972

52,087,403

31,153,207


192



National bank charters issued* and mergers consummated pursuant to corporate reorganizationsy by States, calendar 1970


Sept. 30, 1970

Sept. 30, 1970

Dec. 21, 1970

Dec. 21, 1970

Dec. 21, 1970

Dec. 21, 1970

July 28, 1970

Jan. 3, 1970

Jan. 3, 1970


Resulting bank

NEW JERSEY—continued

The Third National Bank & Trust Company of Camden, CamdenThe Fourth National Bank & Trust Company of Camden, Camden


The Third National Bank and Trust Company of Camden, Camden. . .

Peoples National Bank of Monmouth County, Hazlet TownshipSecond Peoples National Bank of Monmouth County, Hazlet Township


Peoples National Bank of Monmouth County, Hazlet Township

City National Bank, HackensackFirst National State Bank of North Jersey, Hackensack

Charter issued December 17, 1970

First National State Bank of North Jersey, Hackensack

The Edison Bank, South PlainfieldThe Edison Bank, National Association, South Plainfield


The Edison Bank, National Association, South Plainfield

First National Bank of Spring Lake, Spring LakeFirst National State Bank of Spring Lake, Spring Lake


First National State Bank of Spring Lake, Spring Lake

The Warren County National Bank, WashingtonThe Second Warren County National Bank, Washington


The Warren County National Bank, Washington

NEW YORK

The National Bank of Auburn, AuburnBank of Auburn, National Association, Auburn

Charter issued July 27, 1970

The National Bank of Auburn, Auburn

OHIO

First National Bank of Cambridge, CambridgeThe Guernsey County National Bank, Cambridge


First National Bank of Cambridge, Cambridge

Coshocton National Bank, CoshoctonNational Bank of Coshocton, Coshocton


Coshocton National Bank, Coshocton

Totalcapitalaccounts

$ 1,939,271

2,226,998

3,581,752

6,242,148

1,583,352

3,045,118

2,857,715

2,261,848

3,366,770

Totalassets

$ 26,960,278

33,977,506

54,808,637

74,021,762

21,992,135

40,399,333

34,656,987

29,018,008

45,858,949


193



National bank charters issued* and mergers consummated pursuant to corporate reorganizations, by States, calendar 1970


Aug. 31, 1970

Dec. 16, 1970

Feb. 24, 1970

Mar. 25, 1970

Feb. 27, 1970

Apr. 30, 1970

Dec. 10, 1970


Resulting bank

OHIO—continued

The Peoples National Bank and Trust Company, DoverThe F. B. G. National Bank of Dover, Dover

Charter issued August 26, 1970

The Peoples National Bank and Trust Company, Dover

The First National Bank at East Palestine, East PalestineEast Palestine National Bank, East Palestine


The First National Bank at East Palestine, East Palestine

PENNSYLVANIA

Gallatin National Bank, UniontownBlythe National Bank, Uniontown

Charter issued February 20, 1970

Gallatin National Bank, Uniontown

Cumberland County National Bank and Trust Company, New Cumber-ldHU

CCNB National Bank, New CumberlandCharter issued March 23, 1970

Cumberland County National Bank and Trust Company, New Cumber-land

RHODE ISLAND

Columbus National Bank of Rhode Island, ProvidenceRhodes National Bank, Providence

Charter issued February 27, 1970

Columbus National Bank of Rhode Island, Providence

TEXAS

The Fort Worth National Bank, Fort WorthBank of Fort Worth, National Association, Fort Worth


The Fort Worth National Bank, Fort Worth

Bank of the Southwest, National Association, Houston, HoustonSouthwest Bank, National Association, Houston


Bank of the Southwest, National Association, Houston, Houston

Totalcapital

accounts

$ 2,614

1,048

10,908

6,990

3,535

45,074

80,787

,948

,169

,069

,839

,730

,804> " " • * •

,107

Totalassets

S 43,191,034

10,331,092

148,708,580

101,115,634

47,395,936

554,095,040

763,638,469

"Includes only charter issuances related to mergers consummated during 1970. For a full listing of all charters issued during1970, pursuant to corporate reorganizations, see Table B - l l .

194


TABLE B-10

State-chartered hanks converted to National hanks, calendar 1970*

CharterNo.

15789

15784

15786

15790

15791

15797

15799

15804

15813

15817

15847

15851

Title and location of bank

Total: 12 banks

Mercantile National Bank, AtlantaConversion of Mercantile City Bank.

Citizens National Bank of Grant County,Marion

Conversion of The Van Buren Bank.First National Bank, Evergreen

Conversion of Evergreen State Bank.Bank of Passaic and Clifton, N.A., Passaic

Conversion of Bank of Passaic and Clifton.University National Bank, Denver

Conversion of University Hills Bank.First National Bank, Brewton

Conversion of Citizens-Farmers & MerchantsBank, Inc.

First National Bank, FontanelleConversion of State Savings Bank.

Montana National Bank of Butte, ButteConversion of Security Bank.

First National Bank of Chugwater, Chugwater. .Conversion of Chugwater Valley Bank.

Thumb National Bank and Trust Company,Pigeon

Conversion of Pigeon State Bank.Old Colony Trust N.A., Boston

Conversion of Old Colony Trust Company.First National Bank, Rosedale

Conversion of Bank of Beulah.

State

Ga

Ind

Colo

NJColo

Ala

I o w a . . . .

M o n t . . . .

Wyo

Mich

M a s s . . . .

Miss

Effectivedate ofcharter1970

Feb. 28

Mar. 2

Mar. 2

Mar. 13

Mar. 26

Apr. 30

May 1

May 20

July 17

Aug. 12

Dec. 31

Dec. 29

Outstandingcapital stock

$11,579,514

415,625

200,000

250,000

3,891,885

800,000

330,000

80,000

180,000

50,000

275,000

5,000,000

107,004

Surplus, un-divided

profits andreserves

$18,801,857

688,109

394,862

426,718

7,300,528

1,139,985

1,002,034

270,000

300,289

74,566

449,042

6,668,721

87,003

Total assets

$249,945,160

7,068,472

5,320,176

7,927,462

145,953,479

27,421,984

15,945,719

4,391,359

6,795,697

1,374,622

11,327,476

14,765,009

1,653,705

T h e Edison Bank, South Plainfield, N.J., became a National bank, The Edison Bank, National Association, during a corpo-rate reorganization pursuant to the establishment of a one-bank holding company (see Table B-9).

195


TABLE B-l 1

National bank charters issued pursuant to corporate reorganizations, by States, calendar 1970

CharterNo.

Title and location of bank Date ofissuance

13689

200475

15611

41114939

1346132031543012014414714521316587925

1584513898860

1345

429313850

145425034

13981

31318645

Total: 26 banks.

LOUISIANA

NBC National Bank, New Orleans.

MASSACHUSETTS

Massachusetts Bank, National Association, BostonNew England Merchants Bank (National Association), Boston.

Warren National Bank, Warren.

Chillicothe National Bank, GhillicotheFirst National Bank of Buchanan County, St. Joseph.

NEW JERSEY

Cumberland County National Bank, BridgetonThe Fourth National Bank & Trust Company of Camden, Camden....Second Raritan Valley National Bank, Edison TownshipFirst National State Bank of North Jersey, HackensackSecond Peoples National Bank of Monmouth County, Hazlet Township.National State Bank of New Jersey, NewarkEssex Bank, National Association, NewarkThe National Bank of New Jersey, New BrunswickThe Second Sussex and Merchants National Bank of Newton, Newton. .The Edison Bank, National Association, South Plainfield ,First National State Bank of Spring Lake, Spring LakeThe Second Warren County National Bank, Washington

NEW YORK

Bank of Auburn, National Association, Auburn.

The F.B.G. National Bank of Dover, Dover. .East Palestine National Bank, East Palestine.

PENNSYLVANIA

CCNB National Bank, New Cumberland.Blythe National Bank, Uniontown

RHODE ISLAND

Rhodes National Bank, Providence.

TEXAS

Bank of Fort Worth, National Association, Fort Worth.Southwest Bank, National Association, Houston

Dec. 29

Dec. 30June 15

June 29

Apr. 21Apr. 28

Sept. 28Sept. 28June 10Dec. 17Sept. 28Jan. 12June 10Dec. 30June 10Dec. 17Dec. 17Dec. 17

July 27

Aug. 26Dec. 15

Mar. 23Feb. 20

Feb. 27

Apr. 27Dec. 8

196


TABLE B-12

National banks reported in voluntary liquidation, calendar 1970

Title and location of bankDate ofliquida-

tion

Total capitalaccounts ofliquidated

banks

Total: 7 National banks. $12,463,170

Southland National Bank, Yucaipa, Calif. (15488) absorbed by United States National Bank, SanDiego, Calif. (10391)

Commonwealth National Bank, San Francisco, Calif. (15330) absorbed by Union Bank, Los Angeles,Calif.

Umpqua National Bank, Reedsport, Oreg. (10676) absorbed by The Oregon Bank, Portland, Oreg. . . .The First National Bank of Carlton, Carlton, Minn. (6973) absorbed by Carlton National Bank,

Carlton, Minn. (15825)First National Bank in Tonasket, Tonasket, Wash. (14166) absorbed by Old National Bank of Washing-

ton, Spokane, Wash. (4668)Gold Standard National Bank of Marienville, Marienville, Pa. (5727) absorbed by The Warren

National Bank, Warren, Pa. (4879)Republic National Bank and Trust Company, Beverly Hills, Calif. (15331) absorbed by The Hongkong

& Shanghai Banking Corporation of California, San Francisco, Calif

Jan. 30

Apr. 24May 1

Sept. 9

Sept. 30

Oct. 30

Dec. 15

1,552,640

6,265,3381,196,061

141,496

748,788

328,579

2,230,268

TABLE B-13

National banks merged or consolidated with State banks, calendar 1970

Title and location of bankEffective

date

Total capitalaccounts ofNational

banks

Total: 8 banks.

The Peoples National Bank of Hackettstown, Hackettstown, NJ. (8267) merged into Peoples Trust ofNew Jersey, Hackensack, N.J., under the title "Peoples Trust of New Jersey"

The First National Bank of Salamanca, Salamanca, N.Y. (2472) merged into First Trust Union Bank,Wellsville, N.Y., under the title of "First Trust Union Bank"

National City Bank of Baltimore, Baltimore, Md. (15102) merged into Suburban Trust Company,Hyattsville, Md., under the title of "Suburban Trust Company"

Metropolitan National Bank of Maryland, Wheaton, Md. (14985) merged into Union Trust Companyof Maryland, Baltimore, Md., under the title "Union Trust Company of Maryland"

The First National Bank in Frackville, Frackville, Pa. (13992) merged into American Bank and TrustCompany of Reading, Reading, Pa., under the title "American Bank and Trust Company"

First National Bank in New Egypt, New Egypt, NJ. (13910) merged into Bordentown BankingCompany, Bordentown Township, NJ., under the title "The Bank of Mid-Jersey"

Citrus National Bank of West Covina, West Covina, Calif. (15216) merged into Golden State Bank ofBell Gardens, Los Angeles, Calif., under the title "Golden State Bank"

The National Bank of Eaton Rapids, Eaton Rapids, Mich. (13995) consolidated into the AmericanBank and Trust Company, Lansing, Mich., under the title "American Bank and Trust Company". . .

May 25

Aug. 31

Sept. 11

Oct. 19

Oct. 19

Oct. 23

Oct. 30

Dec. 31

$11,085,491

1,757,526

788,664

3,192,033

1,277,961

906,255

710,457

1,536,368

916,227

197


TABLE B-14

National banks converted into State banks, calendar 1970

Title and location of bank Effectivedate

Total capitalaccounts ofNational

banks

Total: 41 banks.

City National Bank, Tulsa, Okla. (14908) converted into City Bank and Trust CompanyThe Farmers National Bank of Fayetteville, Fayetteville, Tex. (10954) converted into Fayetteville Bank. .First National Bank of Owasso, Owasso, Okla. (15006) converted into First Bank of OwassoThe First National Bank of Milford, Milford, Tex. (12685) converted into First State Bank, Milford. . .First National Bank in Atoka, Atoka, Okla. (15093) converted into First Bank in AtokaFirst National Bank in Sulphur, Sulphur, Okla. (11016) converted into First Oklahoma Bank and

Trust Company in SulphurFounders National Bank of Oklahoma City, Oklahoma City, Okla. (15333) converted into Founders

Bank and Trust CompanyFirst Strawn National Bank, Strawn, Tex. (12775) converted into Strawn Security BankThe Edgar County National Bank and Trust Company, Paris, 111. (2100) converted into The Edgar

County Bank and Trust CompanyThe Security National Bank of Cairo, Cairo, 111. (13804) converted into Security Bank and Trust

Company.The National Bank of Verden, Verden, Okla. (8859) converted into The Bank of VerdenThe Batavia National Bank, Batavia, 111. (9500) converted into Batavia BankFirst National Bank of Haskell, Haskell, Okla. (7822) converted into First Bank of HaskellGuaranty National Bank of Oklahoma City, Oklahoma City, Okla. (15207) converted into Guaranty

Bank and Trust CompanyCommercial National Bank of Victoria, Victoria, Tex. (15130) converted into Commercial Bank of

VictoriaFirst National Bank of Holly, Holly, Colo. (7704) converted into First Bank and TrustThe Kingston National Bank, Kingston, Pa. (14023) converted into State Bank of Eastern Pennsylvania.The Solomon National Bank, Solomon, Kans. (9794) converted into The Solomon State BankCommonwealth National Bank, Boston, Mass. (15399) converted into Commonwealth Bank and

Trust CompanyDoylestown National Bank and Trust Company, Doylestown, Pa. (573) converted into Continental

BankFirst National Bank in Spirit Lake, Spirit Lake, Iowa (13020) converted into First Bank and Trust. . . .The East Stroudsburg National Bank, East Stroudsburg, Pa. (4011) converted into Pocono BankThe National Bank of Commerce of Tulsa, Tulsa, Okla. (9942) converted into Bank of Commerce of

TulsaThe First National Bank in Hawarden, Hawarden, Iowa (13939) converted into First State BankThe First National Bank of Wagoner, Wagoner, Okla. (5016) converted into First Wagoner Bank and

Trust CompanyThe First National Bank and Trust Company of Mount Vernon, Mount Vernon, 111. (13864) con-

verted into First Bank and Trust CompanyThe Farmers National Bank of Carnegie, Carnegie, Okla. (12059) converted into The Farmers Bank. . .The First National Bank of Sentinel, Sentinel, Okla. (9995) converted into Southwest State BankFirst National Bank of Oak Brook, Oak Brook, 111. (15596) converted into Oak Brook BankContinental National Bank, Phoenix, Ariz. (15364) converted into Continental BankThe First National Bank of Minco, Minco, Okla. (8644) converted into The First American BankHillside National Bank of Dallas, Dallas, Tex. (15101) converted into Hillside Bank and Trust Company. .Commercial National Bank and Trust Company, Muskogee, Okla. (12890) converted into Commercial

Bank and Trust CompanyNational Bank of Commerce of Spartanburg, Spartanburg, S.C. (15619) converted into First-Citizens

Bank and Trust Company of South CarolinaFirst National Bank of Cleveland, Cleveland, Tex. (10276) converted into Cleveland Bank and Trust. . .American National Bank in Pry or, Pry or, Okla. (14615) converted into American Bank of Oklahoma. .The Havelock National Bank of Lincoln, Lincoln, Nebr. (9772) converted into Havelock BankThe Lawndale National Bank of Chicago, Chicago, 111. (10247) converted into The Lawndale Trust and

Savings BankThe First National Bank in Seagraves, Seagraves, Tex. (14646) converted into The First State Bank in

Se;The Citizens National Bank of Tunkhannock, Tunkhannock, Pa. (6438) converted into United Penn

BankOrange National Bank, Orange, Tex. (5890) converted into Orange Bank

an. 2an. 2an. 2an. 9Ian. 15

Jan. 15

Feb. 4Feb. 16

Feb. 24

Feb. 24Mar. 2Mar. 2Mar. 2

Mar. 9

Apr. 16

June 8

Aug. 31

Nov. 25

Dec. 1

Dec. 4Dec. 30

$53,200,254

1,811,456233,131486,214163,914246,975

868,203

1,121,936172,837

1,692,377

450,84878,194

665,348243,310

1,267,275

961,775207,340

2,107,018345,392

3,882,762

3,990,093824,332

2,557,705

2,315,803396,611

757,038

2,530,564281,523337,558

1,120,2903,985,722

230,9771,237,866

3,391,499

2,023,0081,013,3341,018,979

782,063

3,177,346

324,143893,662

3,003,833

198


TABLEB-15

Purchases of State banks by National banks, calendar 1970

Title and location of banks

Total: 6 banks $3,741,259

First National Bank in Mansfield, Mansfield, La. (11669) purchased the Bank of Grand Cane, GrandCane, Louisiana

Zions First National Bank, Salt Lake City, Utah (4341) purchased the Bank of Commerce, Magna, Utah. .Zions First National Bank, Salt Lake City, Utah (4341) purchased the Bank of St. George, St. George,

UtahPeoples National Bank of Washington, Seattle, Wash. (14394) purchased the Langley State Bank,

Langley, WashingtonPark National Bank of Newark, Newark, Ohio (9179) purchased the Peoples State Bank, Granville, Ohio.Zions First National Bank, Salt Lake City, Utah (4341) purchased the Bountiful State Bank, Bountiful,

Utah

Total capitalaccounts ofState banks

54,945216,431

1,137,638

403,265935,860

993,120

TABLE B-16

Consolidations* of National banks, or National and State banks, calendar 1970

Effectivedate

Aug. 7

June 30

July 10

Dec. 31

Consolidating banksResulting bank

Total: 10 consolidations

CALIFORNIA

National Bank of Agriculture, Delano (15450)The First National Bank of Caruthers, Caruthers (11330). .

National Bank of Agriculture, Fresno (11330)

INDIANA

The First National Bank of Cedar Lake, Cedar Lake(14813)

State Bank of Whiting, Whiting . . .

Northwest Bank of Indiana, N.A., Whiting (14813)

NEW JERSEY

Trust Company National Bank, Morristown (4274)Montclair National Bank and Trust Company, Montclair

(9339)

American National Bank & Trust, Montclair (4274)

The First National Bank of Roselle, Roselle (8483)First National Bank of Central Jersey, Somerville (3866). .

First National Bank of Central Jersey, Somerville (3866). .

Outstandingcapitalstock

$503,750100,000

603,750

173,250300,000

750,000

4,012,848

4,488,430

8,321,740

300,0003,093,750

3,693,750

Surplus

$304,688200,000

504,687

326,750700,000

750,000

4,013,437

5,500,000

9,701,165

300,0003,906,250

3,906,250

Undividedprofits and

reserves

$103,811153,119

257,270

198,795430,370

629,165

4,185,362

5,182,545

9,512,596

1,115,3911,736,788

2,852,179

Total assets

$12,832,5434,087,442

17,971,623

7,984,35823,399,108

31,383,466

187,631,441

153,852,352

340,612,870

17,830,469119,944,993

137,775,462


199


TABLE B-l 6—Continued

Consolidations* of National banks, or National and State banks, calendar 1970

Effectivedate

July

Oct.

Jan.

June

Dec.

Aug.

6

13

1

30

7

17

Consolidating banksResulting bank

NEW YORK

National Bank of North America, New York (7703)Trade Bank and Trust Company, New York

National Bank of North America, New York (7703)

National Bank of North America, New York (7703)First National Bank in Yonkers, Yonkers (13882)

National Bank of North America, New York (7703)

PENNSYLVANIA

The Delaware County National Bank, Chester (355). . . .National Bank of Chester County and Trust Company,

West Chester (552)

Southeast National Bank of Pennsylvania, Chester (355). .

The First National Bank of Westmoreland, Greensburg(14055)

The Peoples National Bank of Tarentum, Tarentum(5351)

Southwest National Bank of Pennsylvania, Greensburg(5351)

Lancaster County Farmers National Bank, Lancaster(683)

The Reading Trust Company, ReadingNational Bank and Trust Company of Central Pennsyl-

vania, York (694)

National Central Bank, York (694)

WASHINGTON

The Pacific National Bank of Seattle, Seattle (13230)National Bank of Washington, Tacoma (3417)

Pacific National Bank of Washington, Seattle (3417). . . .


$24,995,8357,462,760

29,029,750

29,029,7501,397,550

30,918,330

1,753,290

1,018,500

3,026,415

1,496,000

500,000

3,144,000

2,682,5701,676,290

7,367,020

15,211,900

9,000,0007,368,262

13,750,000

Surplus

$45,004,1655,787,240

60,970,250

60,970,2502,396,228

69,081,670

2,548,000

4,281,500

6,829,500

2,640,000

1 050 000

2,500,000

6,392,4306,323,170

9,310,382

22,026,522

9,531,73711,000,000

23,250,000


reserves

$40,563,6345,330,073

39,143,707

46,126,458- 0 -

39,920,236

4,843,731

2,160,516

6,749,622

2,022,690

546,119

2,675,809

4,182,4092,552,175

9,843,973

13,091,639

7,695,5647,299,000

14,894,564

$1

1

1

2

Total assets

,711,720,943230,671,731

,942,392,675

,988,427,915140,426,794

,138,854,709

161,059,614

103,691,564

264,751,178

78,418,692

26,640 833

105,059,524

157,188,189158,827,533

281,850,571

597,866,293

454,265,462254,292,665

708,296,502

*Excludes consolidations involving only 1 operating bank, effected pursuant to corporate reorganizations.

200


TABLEB-17

Mergers* of National banks, or National and State banks, by States, calendar 1970

Effectivedate

Merging banksResulting bank


SurplusUndivided

profits andreserves

Total assets

Apr. 10

June 11

July 31

Nov. 6

Apr. 17

Oct. 30

May 18

July 1

Total: 60 merger actions

CALIFORNIA

Los Padres National Bank, Santa Maria (15271)Wells Fargo Bank, National Association, San Fran-

cisco (15660)

Wells Fargo Bank, National Association, San Fran-cisco (15660)

Gateway National Bank, El Segundo (15239)Southern California First National Bank, San Diego

(3050)

Southern California First National Bank, San Diego(3050)

Bank of Sacramento, SacramentoSecurity Pacific National Bank, Los Angeles (2491). . .

Security Pacific National Bank, Los Angeles (2491). . .

The First National Bank of Holtville, Holtville (9770).Wells Fargo Bank, National Association, San Fran-

cisco (15660)

Wells Fargo Bank, National Association, San Fran-cisco (15660)

CONNECTICUT

The Atlantic National Bank, Stamford (15584)The Connecticut National Bank, Bridgeport (335). . .

The Connecticut National Bank, Bridgeport (335). . .

General Bank and Trust Company, New HavenHartford National Bank and Trust Company, Hart-

ford (1338)

Hartford National Bank and Trust Company, Haft-ford (1338)

Lava Hot Springs State Bank, Lava Hot Springs. . . .The Cassia National Bank of Burley, Burley (12256).

The Cassia National Bank of Burley, Burley (12256).

Fidelity National Bank of Twin Falls, Twin Falls(11100)

The Idaho First National Bank, Boise (1668)

The Idaho First National Bank, Boise (1668).


$500,000

91,757,810

92,257,810

1,595,226

7,062,495

7,062,495

2,262,750168,000,000

170,262,750

400,000

92,419,970

92,859,970

350,0006,451,225

7,151,225

400,000

17,693,525

17,993,525

25,000250,000

360,000

1,000,0008,002,315

8,714,815

$375,000

185,242,820

185,542,420

1,126,314

13,285,305

13,285,305

2,447,250182,000,000

189,737,250

400,000

185,455,260

185,815,260

650,00012,000,000

12,900,000

400,000

44,306,475

44,806,475

80,000350,000

350,000

1,000,00017,000,000

18,000,000

$356,628

56,400,610

56,757,238

265,311

12,044,200

15,031,052

127,667122,362,960

116,522,457

179,980

65,490,961

65,670,942

176,3184,159,177

4,164,714

150,000

15,593,199

17,743,299

11,252290,343

290,343

848,7016,958,357

8,094,559

$12,438,566

5,436,787,409

5,449,225,975

31,745,184

601,086,646

632,831,830

42,497,3596,722,389,757

6,758,034,271

13,927,142

5,514,746,846

5,527,924,917

19,569,744360,808,344

380,378,088

8,076,269

1,041,105,191

1,048,981,460

739,85713,081,949

13,821,806

27,413,294500,740,908

524,045,759

201



Effectivedate

Dec. 1

July 31

June 2

Aug. 14

May 1

July 6

June 30

Mar. 18

Mergers* of National banks, or National and State banks


INDIANA

The First National Bank of Center Point, Center Point(9250)

The Riddell National Bank of Brazil, Brazil (5267)

The Riddell National Bank of Brazil, Brazil (5267). . .

KANSAS

Exchange State Bank of Kansas City, Kansas C i t y . . . .The Commercial National Bank of Kansas City,

Kansas City (6311)

The Commercial National Bank of Kansas City,Kansas City (6311) .

MAINE

The First National Bank of Houlton, Houlton (2749). .The First National Bank of Fort Fairfield, Fort Fair-

field (13843)

The First National Bank of Aroostook, Fort Fairfield(13843)

The First National Bank of Pittsfield, Pittsfield (13777).Maine National Bank, Portland (4128)

Maine National Bank, Portland (4128)

MARYLAND

The First National Bank of Harford County, Bel Air(13680)

The First National Bank of Maryland, Baltimore(1413) .

The First National Bank of Maryland, Baltimore(1413)

Montgomery Banking Trust Company, RockvilleUniversity National Bank, Rockville (15365)

University National Bank, Rockville (15365)

MASSACHUSETTS

Bristol County Trust Company, TauntonThe First National Bank of Attleboro, Attleboro (2232).

First Bristol County National Bank, Taunton (2232). .

MICHIGAN

The Armada State Bank, ArmadaFirst National Bank in Mt. Clemens, Mt. Clemens

(12971)

First National Bank in Mt. Clemens, Mt. Clemens(12971)


$25,000400,000

475,000

500,000

3,000,000

3,475,000

400,000

157,500

610,000

250,0005,020,330

5,420,330

700,000

12,123,760

12,526,260

1,000,0001,434,000

2,394,000

750,0001,000,000

2,400,000

150,000

1,320,000

1,488,750

, by States, calendar 1970

Surplus

$125,000400,000

525,000

500,000

3,000,000

4,000,000

600,000

210,000

1,493,078

250,0006,479,670

6,729,960

1,100,000

25,376,240

27,473,740

500,0001,999,630

2,632,732

1,371,8001,000,000

2,400,000

150,000

1,320,000

1,961,250


reserves

$229,9481,218,484

1,389,554

343,067

3,896,406

3,764,473

788,414

230,155

269,922

576,6483,894,441

4,471,090

790,561

14,385,656

12,699,081

93,102212,551

212,551

691,0691,233,829

1,411,457

254,485

1,299,784

1,299,784

Total assets

$3,055,39722,782,237

25,428,913

15,619,327

108,190,718

117,021,889

20,433,149

8,986,563

29,541,440

12,129,152190,482,404

202,611,556

38,156,284

727,720,018

761,510,201

11,181,62839,207,224

48,536,914

38,417,29532,267,252

70,584,400

5,983,449

75,588,838

81,827,802


202




Effectivedate



SurplusUndivided

profits andreserves

Total assets

NEW HAMPSHIRE

Aug. 14 The Wilton National Bank, Wilton (13247)The Indian Head National Bank of Nashua, Nashua

(1310)

The Indian Head National Bank of Nashua, Nashua(1310)

Dec. 31

Jan. 2

Lisbon National Bank, Lisbon (15737). . .Littleton National Bank, Littleton (1885).

The Littleton National Bank, Littleton (1885).

NEW JERSEY

The Bank of Sussex County, FranklinNational Community Bank of Rutherford, Rutherford

(5005)

National Community Bank of Rutherford, Rutherford(5005)

Jan. 9 Peoples National Bank of Sussex County, Sparta(15375)

New Jersey Bank (National Association), Clifton(15709)


Feb. 27 Jersey State Bank, River EdgeNew Jersey Bank (National Association), Clifton

(15709)


Apr. 30

May 11

Union National Bank and Trust Company, MountHolly (2343)

South Jersey National Bank, Camden (1209)

South Jersey National Bank, Camden (1209)

New Jersey National Bank and Trust Company,Neptune (15297)

First Trenton National Bank, Trenton (1327)

New Jersey National Bank, Trenton (1327).

May 22 The Vineland National Bank and Trust Company,Vineland (2918)

Peoples National Bank of New Jersey, Westmont(12022)

Peoples National Bank of New Jersey, Westmont(12022)

$100,000

997,775

1,104,900

75,000150,000

225,000

777,600

8,093,750,

10,361,750

245,400

7,923,366

8,125,821

444,672

8,164,728

8,714,728

1,224,0005,076,563

5,765,063

3,687,5925,925,160

8,998,155

600,000

2,186,379

3,502,629

$370,000

4,502,225

5,000,000

75,000200,000

275,000

1,410,400

12,000,000

15,000,000

222,700

12,138,938

12,404,583

555,325

12,574,359

13,024,359

988,00011,923,437

13,446,938

3,562,4088,376,720

12,553,725

1,400,000

3,736,103

3,736,103

$344,684

540,136

612,516

77,275225,792

260,420

110,375

4,830,125

2,337,297

124,960

9,760,327

9,885,288

349,992

10,621,472

10,971,465

921,2447,339,194

8,260,438

3,239,60911,273,656

14,513,266

1,210,202

1,975,335

1,691,704

$10,266,204

61,808,730

72,071,608

3,156,8688,807,562

12,037,090

55,387,215

374,309,033

430,173,045

8,599,317

506,883,752

515,199,963

20,516,992

506,259,053

526,776,046

34,499,979305,339,193

339,637,141

134,280,383508,284,242

642,564,625

29,709,165

131,715,508

166,461,909


203




Effectivedate



SurplusUndivided

profits andreserves

Total assets

June 30

July 17

Oct. 30

Dec. 4

Feb. 27

July 31

Jan. 23


First National Bank of Williamstown, Williamstown(7265)

First National Bank of South Jersey, Egg HarborTownship (1326)


Pitman National Bank and Trust Company, Pitman(8500)

The First National Bank and Trust Company ofPaulsboro, Paulsboro (5981)

First County National Bank and Trust Company,Woodbury (1199)

National Bank and Trust Company of GloucesterCounty, Woodbury (1199)

The First National Bank of Pedricktown, Pedricktown(8007)


The First National Bank of South Jersey, Egg HarborTownship (1326)

Orange Valley Bank, OrangeFirst National State Bank of New Jersey, Newark

(1452)

First National State Bank of New Jersey, Newark(H52)

NEW YORK

Rockland National Bank, Suffern (5846)County National Bank, Middletown (13956).

Empire National Bank, Middletown (5846). ,

The National Exchange Bank of Boonville, Boonville(8022)

Lincoln National Bank and Trust Company of CentralNew York, Syracuse (15627)

Lincoln National Bank and Trust Company of CentralNew York, Syracuse (15627)

NORTH CAROLINA

Citizens Bank and Trust Company of Andrews,Andrews

Wachovia Bank and Trust Company, National Asso-ciation, Winston-Salem (15673)

Wachovia Bank and Trust Company, National Asso-ciation, Winston-Salem (15673)

$150,000

6,770,000

7,340,000

125,000

330,000

491,420

1,137,420

200,000

7,340,000

7,640,000

125,000

12,423,750

12,423,750

2,901,8553,355,005

6,256,860

100,000

5,000,000

5,100,000

600,000

24,720,035

25,320,035

$550,000

6,770,000

7,340,000

1,000,000

330,000

1,508,580

2,838,580

250,000

7,340,000

7,640,000

175,000

40,040,000

40,340,000

3,000,0004,600,000

7,600,000

200,000

6,500,000

6,700,000

1,000,000

62,318,000

63,318,000

$113,279

3,818,921

3,482,201

469,547

1,571,907

874,279

2,822,277

98,875

3,979,357

3,928,232

299,375

10,357,619

10,656,994

2,399,8252,060,628

4,460,452

288,469

4,984,707

5,273,177

692,386

30,086,560

30,778,946

$15,976,524

256,385,345

272,361,869

15,748,018

24,218,387

40,681,659

80,777,365

6,273,493

285,013,575

291,287,068

7,051,864

861,185,593

866,967,712

149,118,970171,844,047

320,963,017

6,069,082

243,069,535

249,138,617

33,025,897

1,596,594,516

1,629,620,413


204




Effectivedate



SurplusUndivided

profits andreserves

Total assets

Feb. 20

Apr. 30

July 27

Aug. 1

Aug. 28

Nov. 14

Jan. 19

Feb. 28

July 17

NORTH CAROLINA—continued

Marion Bank and Trust Company, MarionNorth Carolina National Bank, Charlotte (13761).

North Carolina National Bank, Charlotte (13761).

The First National Bank of Mooresville, Mooresville(9531)

The First National Bank of Lincolnton, Lincolnton(6744)

Carolina First National Bank, Lincolnton (6744).

The State Bank of Wingate, WingateFirst National Bank of Eastern North Carolina,

Jacksonville (14676)

First National Bank of Eastern North Carolina,Jacksonville (14676)

Bank of Charlotte, CharlotteSouthern National Bank of North Carolina, Lumber-

ton (10610)

Southern National Bank of North Carolina, Lumber-ton (10610)

The State Commercial Bank, ThomasvilleNorth Carolina National Bank, Charolotte (13761). . .

North Carolina National Bank, Charlotte (13761)

The Bank of French Broad, MarshallFirst Union National Bank of North Carolina,

Charlotte (15650)

First Union National Bank of North Carolina,Charlotte (15650)

The West Unity Banking Company, West Unity. . . .The Citizens National Bank of Bryan, Bryan (13740).

The Citizens National Bank of Bryan, Bryan (13740).

Hardy Banking Company, North Baltimore.First National Bank, Bowling Green (15416).

First National Bank, Bowling Green (15416).

The Citizens Savings Bank, Columbiana.The Farmers National Bank of Salem, Salem (973).

The Farmers National Bank of Salem, Salem (973).


$100,00015,274,340

15,524,340

250,000

300,000

700,000

50,000

3,065,375

3,180,375

200,000

3,814,105

3,814,105

372,18015,524,340

16,082,610

100,000

17,868,825

18,068,825

160,000325,620

518,180

50,0001,113,750

1,323,750

125,000750,000

1,062,500

$300,00044,875,660

44,875,660

600,000

400,000

1,300,000

250,000

5,075,625

5,271,625

1,600,000

4,547,205

4,546,205

745,71544,875,660

45,435,285

451,745

25,500,000

26,000,000

240,000325,730

565,730

250,0001,186,250

1,426,250

525,0001,000,000

1,525,000

$121,54417,155,939

17,277,482

263,868

907,440

721,308

66,106

848,528

903,634

286,440

2,754,013

930,761

413,84221,249,003

21,736,547

228,244

11,907,261

11,987,250

205,546513,964

686,950

193,815399,192

457,839

226,909736,133

775,543

$4,638,6851,223,694,661

1,228,333,346

11,138,427

21,496,891

32,635,318

3,046,720

105,073,518

108,120,239

23,910,939

167,058,069

202,508,937

17,827,1851,284,569,745

1,302,645,825

8,906,330

1,042,875,218

1,051,781,548

7,476,66318,416,311

25,976,478

4,281,05230,728,502

34,864,742

11,094,20137,561,201

48,655,402

205




Effectivedate

Nov.

Mar.

Mar.

June

July

Aug.

Aug.

Sept.

Dec.

6

13

31

30

1

28

31

30

31


OHIO—continued

The Pioneer Banking Company, PioneerThe Citizens National Bank, Bryan (13740)

The Citizens National Bank, Bryan (13740)

PENNSYLVANIA

Community Bank and Trust Company, PaoliCentral Penn National Bank, Bala-Cynwyd (723)

Central Penn National Bank, Bala-Cynwyd (723)

The Citizens National Bank, Blossburg (13381)First National Bank in Mansfield, Mansfield (13618). .

First Citizens National Bank, Mansfield (13618)

The Fogelsville National Bank, Fogelsville (12975). . .The Merchants National Bank of Allentown, Allen-

town (6645) .

The Merchants National Bank of Allentown, Allen-town (6645)

The Peoples Bank of Clymer, ClymerThe First National Bank of Ebensburg, Ebensburg

(5084)

The First National Bank of Ebensburg, Ebensburg(5084) . . . .

Saucon Valley Trust Company, HellertownThe First National Bank of Allentown, Allentown

(373)

The First National Bank of Allentown, Allentown(373)

The Citizens Bank of Wind Gap, Wind GapEaston National Bank and Trust Company, Easton

(1233)

Easton National Bank and Trust Company, Easton(1233)

The First National Bank of Edinboro, Edinboro (7312).Marine National Bank, Erie (870)

Marine National Bank, Erie (870)

Grange National Bank of Potter County, Ulysses(8739)




$75,000525,140

637,640

930,2506,323,620

7,253,870

50,000125,000

500,000

281,250

2,697,990

3,541,740

50,000

273,000

328,000

300,000

3,392,110

3,722,110

100,000

1,350,000

1,510,000

300,0003,900,000

4,680,000

192,320500,000

601,000

Surplus

:

216

18

6

1

1

15

15

4

4

4

$200,000575,000

775,000

,098,625,244,085

,342,710

200,000250,000

500,000

625,000

000,000

,625,000

250,000

,100,000

,345,000

700,000

,000,000

,700,000

400,000

,000,000

,400,000

300,000,100,000

,920,000

206,060500,000

706,060


reserves

$123,426705,991

752,970

941,27610,858,188

11,799,463

222,624589,119

436,744

815,033

2,370,373

2,645,553

330,059

825,908

1,155,967

392,465

3,816,058

4,178,523

238,039

2,155,697

2,337,736

275,4781,187,470

1,462,948

63,625468,372

623,318

Total assets

$5,459,26128,962,951

34,383,265

48,912,682444,909,782

488,940,101

5,419,06911,901,611

17,320,680

20,875,731

185,639,802

206,538,179

4,419,247

40,939,057

45,358,305

16,691,247

260,658,654

277,349,902

7,835,984

91,385,965

99,221,949

10,464,946118,134,273

128,599,219

5,872,24519,052,692

24,924,937


206




Effectivedate



SurplusUndivided

profits andreserves

Total assets

Jan. 9

Sept. 10

July 9

Mar. 13

June 1

July 31

Aug. 31

Nov. 23

SOUTH DAKOTA

Community State Bank of Lake Preston, Lake Preston.Northwestern National Bank of Sioux Falls, Sioux

Falls (10592)

Northwestern National Bank of Sioux Falls, SiouxFalls (10592)

Security Bank, Madison

National Bank of South Dakota, Sioux Falls (12881).

National Bank of South Dakota, Sioux Falls (12881).

VERMONT

Barre Trust Company, BarreThe Merchants National Bank of Burlington, Burling-

ton (1197)

The Merchants National Bank of Burlington, Burling-ton (1197)

VIRGINIA

The First National Bank of Harrisonburg, Harrison-burg (1572)

Virginia National Bank, Norfolk (9885)

Virginia National Bank, Norfolk (9885).

The Merchants and Farmers Bank, Smithfield.Virginia National Bank, Norfolk (9885)


Suburban National Bank of Virginia, Fairfax County(14965)

First and Merchants National Bank, Richmond (1111).

First and Merchants National Bank, Richmond (1111).

The National Bank of Orange, Orange (5438)National Bank and Trust Company, Charlottesville

(10618)

National Bank and Trust Company, Charlottesville(10618)

Carroll County Bank, Hillsville.Virginia National Bank, Norfolk (9885).



$150,000

3,250,000

3,500,000

300,0004,000,000

4,300,000

50,000

650,000

650,000

1,200,00018,680,000

20,000,000

134,10020,000,000

20,268,200

1,314,00018,652,700

19,966,700

225,000

1,780,785

2,005,785

400,00020,268,200

20,552,290

$200,000

2,500,000

3,500,000

450,0004,000,000

4,450,000

-0-

810,000

810,000

1,300,00024,501,275

25,681,275

500,00025,681,275

26,047,175

1,429,04831,587,300

33,223,300

500,000

3,545,000

4,045,000

400,00026,047,175

26,563,085

$245,046

1,665,496

1,111,067

249,3794,418,399

4,667,779

277,892

570,517

457,149

915,78015,831,511

16,747,291

327,51319,339,239

19,666,752

-0-16,900,059

16,693,107

624,137

2,974,086

3,960,348

139,98220,494,410

20,634,393

$6,502,795

129,971,893

136,325,911

10,472,960191,741,613

202,214,573

10,734,254

33,728,785

44,021,777

39,328,751915,449,691

954,254,957

9,760,533958,154,895

967,583,357

49,353,508769,096,943

816,282,176

16,090,627

102,033,911

124,566,561

14,747,9391,036,189,871

1,050,427,829

207




Effectivedate

Apr. 30

Sept. 25

Sept. 1


WASHINGTON

Commercial Bank of Washington, TwispOld National Bank of Washington, Spokane (4668). . .

Old National Bank of Washington, Spokane (4668). . .

North West Bank, SeattleOld National Bank of Washington, Spokane (4668). . .

Old National Bank of Washington, Spokane (4668). . .

WISCONSIN

The Home Bank, Milwaukee .Midland National Bank, Milwaukee (15510)

Midland National Bank, Milwaukee (15510)


300,0005,333,900

5,573,900

1,710,0005,573,900

6,642,650

1,000,0002,191,875

2,941,875

Surplus

145,06010,062,386

10,799,886

318,10010,821,290

10,775,040

900,0001,571,952

2,721,952


reserves

41,4178,221,466

7,724,773

907,3068,257,252

10,170,158

38,965942,705

981,670

Total assets

5,495,805291,760,801

298,114,823

15,998,718316,064,001

332,062,719

24,740,76078,826,911

100,572,816

*Excludes mergers involving only 1 operating bank, effected pursuant to corporate reorganization.

TABLE B-18

Mergers resulting in National banks, by assets of acquiring and acquired banks, 1960-1970*

Assets of acquiring bank]

Under $10 million . . . .$10 million to $24.9 million$25 million to $49.9 million$50 million to $99.9 million$100 million and over

Total.

Acquiringbank

80127130147420

$904

Assets of acquired bank *

Under $10million

801138895

187

563

$10 million to24.9

million

0143433

143

224

$25 million to49.9

million

008

1646

70

$50 million to99.9

million

0003

21

24

$100 millionand over

0000

23

23

*Includes all forms of acquisitions involving two or more banks, from May 13, 1960 through December 31,1970.fin each transaction, the bank with larger total assets was considered to be the acquiring bank.{Comprises 871 transactions, 18 involving 3 banks, 6 involving 4 banks, and 1 involving 5 banks.

208


TABLE R-19

Domestic branches entering the National Banking System, by de novo opening, merger, or conversion, by States, calendar 1970

CharterNo. Title and location of bank

Branches opened for business

Local Other thanlocal

12455154733185

1579714414146645249

1565815316154411814

11635

1465112072

372814324

10609146061394915608

15437146951543410120129041523915453113302490

155471522062688181

15532152761548915032153493050

103911304496551741

1566015357

Total

ALABAMA

The First National Bank of Auburn, AuburnCity National Bank of Birmingham, BirminghamThe First National Bank of Birmingham, BirminghamFirst National Bank, BrewtonState National Bank of Alabama, DecaturCity National Bank of Dothan, DothanThe First National Bank of Dothan, DothanFort Rucker National Bank, Fort RuckerThe American National Bank of Huntsville, HuntsvilleThe Capitol National Bank of Montgomery, MontgomeryThe First National Bank of Montgomery, MontgomeryOpelika National Bank, Opelika

ALASKA

National Bank of Alaska, Anchorage

The First National Bank of Anchorage, Anchorage

ARIZONA

First National Bank of Arizona, Phoenix

The Valley National Bank of Arizona, Phoenix

ARKANSAS

The City National Bank of Fort Smith, Fort SmithFirst National Bank of Jonesboro, JonesboroThe First National Bank in Little Rock, Little RockFidelity National Bank of West Memphis, West Memphis

CALIFORNIA

American National Bank, BakersfieldCity National Bank, Beverly HillsCommercial National Bank, Buena ParkThe First National Bank of Dixon, DixonThe Capital National Bank, DowneyGateway National Bank, El SegundoEscondido National Bank, EscondidoNational Bank of Agriculture, FresnoSecurity Pacific National Bank, Los AngelesSanta Clarita National Bank, NewhallWest Coast National Bank, OceansideFirst National Bank and Trust Company, OntarioThe First National Bank of Orange County, OrangeCommercial and Farmers National Bank, OxnardPalm Springs National Bank, Palm SpringsRiverside National Bank, RiversidePlacer National Bank, RocklinValley National Bank, SalinasSouthern California First National Bank, San DiegoUnited States National Bank, San DiegoBank of America National Trust and Savings Association, San FranciscoThe Bank of California, National Association, San FranciscoCrocker-Citizens National Bank, San FranciscoWells Fargo Bank, National Association, San FranciscoSan Joaquin Valley National Bank, Tulare

280 643

20

01113

2422

181

209






Other thanlocal

Total

1517015114990715480157861833

14400

3354

1314154961338

215584

15060

203834255046

15599617155412338398315572102701306813472

14911

166812256

132361367255841482014738563813709136951451614662

COLORADO

Northern National Bank, Colorado SpringsNortheast Colorado National Bank, DenverThe First National Bank of Englewood, EnglewoodRepublic National Bank of Englewood, EnglewoodFirst National Bank, EvergreenThe First National Bank of Pueblo, PuebloThe Routt County National Bank of Steamboat Springs, Steamboat Springs

CONNECTICUT

The Connecticut National Bank, BridgeportThe State National Bank of Connecticut, BridgeportThe Clinton National Bank, ClintonThe Hamden National Bank, HamdenHartford National Bank and Trust Company, HartfordThe First New Haven National Bank, New HavenThe Atlantic National Bank, Stamford

DELAWARE

The First National Bank of Wilmington, Wilmington

DISTRICT OF COLUMBIA

The First National Bank of Washington, WashingtonThe National Bank of Washington, WashingtonThe Riggs National Bank of Washington, D.C., Washington

GEORGIA

The First National Bank of Atlanta, AtlantaThe Fulton National Bank of Atlanta, AtlantaThe National Bank of Georgia, AtlantaThe First National Bank of Columbus, ColumbusThe First National Bank of Gainesville, GainesvilleFirst National Bank of Griffin, GriffinThe First National Bank & Trust Company in Macon, MaconThe Citizens and Southern National Bank of Savannah, SavannahThe Liberty National Bank & Trust Company of Savannah, Savannah, Georgia,

Savannah

HAWAII

Hawaii National Bank, Honolulu, Honolulu

IDAHO

The Idaho First National Bank, Boise

Cassia National Bank, Burley

ILLINOIS

Belleville National Savings Bank, BellevilleNational Boulevard Bank of Chicago, ChicagoTruitt-Matthews First National Bank, ChillicotheDes Plaines National Bank, Des PlainesCitizens National Bank of Downers Grove, Downers GroveThe First National Bank of Dundee, DundeeFirst National Bank and Trust Company of Evanston, EvanstonFirst National Bank of Freeport, FreeportLawrenceville National Bank & Trust Co., LawrencevilleFirst National Bank of Morton Grove, Morton Grove

210






Other thanlocal

3267206

138181446814379869984

14175135801578414921223417

57561487414813

99415133155242763

5498631138491499911010

394433816028109

143207030

15642146871450314753502315279415411169138511368814477136891497711795

The Riddell National Bank of Brazil, BrazilThe First National Bank, ElkhartFort Wayne National Bank, Fort WayneGary National Bank, GaryCalumet National Bank, HammondMerchants National Bank & Trust Company of Indianapolis, IndianapolisThe Indiana National Bank, IndianapolisLafayette National Bank, LafayetteThe National Bank of Logansport, LogansportCitizens National Bank of Grant County, MarionAmerican National Bank and Trust Company of Muncie, MuncieThe Merchants National Bank of Muncie, MuncieThe First National Bank of Richmond, RichmondThe Tell City National Bank, Tell CityFirst National Bank, Valparaiso, ValparaisoNorthwest Bank of Indiana, National Association, Whiting

IOWA

The Clinton National Bank, ClintonFirst National Bank of Davenport, DavenportFirst National Bank of Eldora, EldoraFirst National Bank Fort Dodge, Iowa, Fort Dodge

KANSAS

Citizens National Bank and Trust Company, EmporiaCommercial National Bank of Kansas City, Kansas CityThe Lawrence National Bank and Trust Co., LawrenceParklane National Bank of Wichita, WichitaUnion National Bank of Wichita, Wichita

KENTUCKY

The Second National Bank of Ashland, AshlandThe Citizens National Bank of Danville, DanvilleThe First-Hardin National Bank of Elizabethtown, ElizabethtownFirst National Bank of Louisville, LouisvilleLiberty National Bank and Trust Company of Louisville, LouisvillePikeville National Bank & Trust Company, Pikeville.

LOUISIANA

Parish National Bank of Bogalusa, BogalusaThe National Bank of Bossier City, Bossier CityCitizens National Bank & Trust Company of Houma, HoumaThe National Bank of Commerce in Jefferson Parish, Jefferson ParishThe First National Bank of Lafayette, LafayetteRiverlands National Bank in LaPlace, LaPlaceThe First National Bank of Lake Charles, Lake CharlesFirst National Bank in Mansfield, MansfieldThe Citizens National Bank of Morgan City, Morgan CityThe Hibernia National Bank in New Orleans, New OrleansNational American Bank of New Orleans, New OrleansThe National Bank of Commerce in New Orleans, New OrleansWhitney National Bank of New Orleans, New OrleansThe First National Bank of Ruston, Ruston

211



Domestic branches entering the National Banking System, by de novo openings merger, or conversion, by States, calendar 1970



Other thanlocal

Total

143714303445913843941

4128

14131374514864436456231536514937151545471

15052200475590528112919397452227513241261799

59447361082147982232113579

146411383313522137381367114740849614144380615367191390

12971137531373914773191838861493415008

MAINE

Merchants National Bank of Bangor, BangorThe Liberty National Bank in Ellsworth, EllsworthThe First National Bank of Farmington, FarmingtonThe First National Bank of Aroostook, Fort FairfieldCanal National Bank, PortlandMaine National Bank, Portland

MARYLAND

The First National Bank of Maryland, Baltimore CityMaryland National Bank, BaltimoreState National Bank of Bethesda, BethesdaThe Citizens National Bank, LaurelThe First National Bank of Oakland, OaklandUniversity National Bank, RockvilleAmerican National Bank of Maryland, Silver SpringPeoples National Bank of Maryland, SuitlandThe First National Bank of Southern Maryland of Upper Marlboro, Upper

Marlboro

MASSACHUSETTS

Suburban National Bank of Arlington, ArlingtonThe First National Bank of Boston, BostonNew England Merchants National Bank of Boston, BostonThe Fall River National Bank, Fall RiverThe Framingham National Bank, FraminghamMerrimack Valley National Bank, HaverhillHolyoke National Bank, HolyokeSecurity National Bank, LynnThe Home National Bank of Milford, MilfordNeedham National Bank, NeedhamThe First National Bank of New Bedford, New BedfordThe Merchants National Bank of New Bedford, New BedfordManufacturers National Bank of Bristol County, North AttleboroFirst National Bank of Cape Cod, OrleansFirst Agricultural National Bank of Berkshire County, PittsfieldSouth Shore National Bank, QuincyFirst Bristol County National Bank, TauntonThe Mechanics National Bank of Worcester, WorcesterWorcester County National Bank, Worcester

MICHIGAN

Peoples National Bank & Trust Company of Bay City, Bay CityFarmers and Merchants National Bank in Benton Harbor, Benton HarborThe Citizens National Bank of Cheboygan, CheboyganManufacturers National Bank of Detroit, DetroitNational Bank of Detroit, DetroitFirst National Bank of East Lansing, East LansingNorthern Michigan National Bank, EscanabaFirst National Bank in Howell, HowellThe First National Bank of Iron Mountain, Iron MountainCity Bank & Trust Co., National Association, JacksonThe First National Bank and Trust Company of Michigan, KalamazooThe First National Bank and Trust Company of Marquette, MarquetteFirst National Bank in Mount Clemens, Mount ClemensFirst National Bank of Southwestern Michigan, NilesCommunity National Bank of Pontiac, PontiacNational Bank of Royal Oak, Royal OakSecond National Bank of Saginaw, SaginawFirst National Bank of St. Ignace, St. IgnaceThe Empire National Bank of Traverse City, Traverse CityTroy National Bank, Troy

010011

00000100

102113

27112412

212






Other thanlocal

1453837651554866817266135511567298653258

1701530215793

140171448013568

7038

12889559808574131015100

108231336310712115431385529991222120979451570931681564620768501154301326233115035384382674147153601294213125644087792884274

MISSISSIPPI

National Bank of Commerce of Corinth, CorinthThe First National Bank of Greenville, GreenvilleDeposit Guaranty National Bank, JacksonThe First National Bank of Laurel, LaurelThe Citizens National Bank of Meridian, MeridianFirst National Bank in Meridian, MeridianFirst National Bank of Ocean Springs, Ocean SpringsThe First National Bank of Oxford, OxfordFirst National Bank of Vicksburg, Vicksburg

MISSOURI

First National Bank in St. Louis, St. LouisThe First National Bank of Sikeston, SikestonSpringfield National Bank, Springfield

NEBRASKA

The First National Bank in Aurora, AuroraFirst National Bank in Kearney, KearneyThe National Bank of Neligh, Neligh

NEVADA

First National Bank of Nevada, Reno, Nevada, Reno

NEW HAMPSHIRE

The Rockingham National Bank of Exeter, ExeterThe Cheshire National Bank of Keene, KeeneThe National Bank of Lebanon, LebanonThe Amoskeag National Bank of Manchester, ManchesterThe Indian Head National Bank of Nashua, NashuaWhite Mountain National Bank of North Conway, North Conway

NEW JERSEY

The First National Bank of Absecon, AbseconFirst Merchants National Bank, Asbury Park, Asbury ParkThe Citizens National Bank of Bloomsbury, BloomsburyBankers National Bank, BogotaThe National Bank of Sussex County, BranchvilleThe Bridgeton National Bank, BridgetonMechanics National Bank of Burlington County, BurlingtonSouth Jersey National Bank, CamdenThe First National Bank of Cape May Court House, Cape May Court HouseNew Jersey Bank (National Association), CliftonThe First National Bank of Cranbury, CranburyPeoples National Bank of Denville, DenvilleThe National Union Bank of Dover, DoverThe First National Bank of Dunellen, DunellenRaritan Valley National Bank, Edison TownshipFirst National Bank of South Jersey, Egg Harbor TownshipThe Flemington National Bank and Trust Company, FlemingtonFranklin Lakes National Bank, Franklin LakesThe First National Bank of Glassboro, GlassboroThe Peoples National Bank of Hackettstown, HackettstownPeoples National Bank of Monmouth County, Hazlet TownshipMadison National Bank, MadisonThe Manville National Bank, ManvilleThe First National Bank of Marlton, MarltonThe Farmers and Merchants National Bank of Matawan, MatawanThe First National Bank of Milford, MilfordFirst Charter National Bank, Monroe TownshipAmerican National Bank & Trust, Montclair

112111011

111

111

005000100

000

000

213




CharterNo, Title and location of bank


Other thanlocal

Total

111312771

14521316587

14240925

15790329

1239487250053866

15845250913272918

157901286113848120221199

1326512606

13814876777208880

5178157581301

15625976

99901546411511

980533665877703

15626139561299710111237014611354

1473413493

465156414230

155561170814763156271342

101554988


The First National Iron Bank of New Jersey, MorristownBroad National Bank, Newark, NewarkFirst National State Bank of New Jersey, NewarkNational Newark and Essex Bank, Newark ,The National Bank of New Jersey, New BrunswickFirst National Bank in Newfield, NewfieldThe Sussex and Merchants National Bank of Newton, Newton ,Bank of Passaic and Clifton, N.A., PassaicFirst National Bank of Passaic County, PatersonThe Phillipsburg National Bank and Trust Company, PhillipsburgThe First National Bank of Princeton, PrincetonNational Community Bank of Rutherford, RutherfordFirst National Bank of Central Jersey, SomervilleThe Edison Bank, National Association, South PlainfieldThe First National Bank of Toms River, N.J., Toms RiverNew Jersey National Bank, TrentonThe Vineland National Bank and Trust Company, VinelandBank of Passaic and Clifton, N.A., WayneThe Prospect Park National Bank, WayneBelmar-Wall National Bank, West BelmarPeoples National Bank of New Jersey, WestmontNational Bank and Trust Company of Gloucester County, Woodbury ,The Wood Ridge National Bank, Wood-RidgeThe Yardville National Bank, Yardville

NEW MEXICO

First National Bank in Albuquerque, AlbuquerqueThe Clovis National Bank, ClovisFirst National Bank of Dona Ana County, Las CrucesThe First National Bank of Lordsburg, Lordsburg

NEW YORK

The First National Bank of Addison, AddisonFirst Trust Company of Albany, National Association, AlbanyNational Commercial Bank and Trust Company, AlbanyFirst City National Bank of Binghamton, N.Y., BinghamtonThe Putnam County National Bank of Carmel, CarmelThe Central Valley National Bank, Central ValleyFirst National Bank of East Hampton, East HamptonMarine Midland Tinker National Bank, East SetauketThe First National Bank of Glens Falls, Glens FallsThe First National Bank of Highland, HighlandSecurity National Bank, HuntingtonNational Bank of North America, New YorkThe First National Bank of Jamestown, JamestownEmpire National Bank, MiddletownFranklin National Bank, MineolaThe First National Bank of Newark Valley, Newark ValleyThe Chase Manhattan Bank (National Association), New YorkFirst National City Bank, New YorkThe National Bank and Trust Company of Norwich, NorwichTappan Zee National Bank, NyackFinger Lakes National Bank, Odessa ,Marine Midland Bank of Southeastern New York, PoughkeepsieThe State of New York National Bank, PoughkeepsieThe Suffolk County National Bank of Riverhead, RiverheadFirst National Bank of Rochester, RochesterScarsdale National Bank and Trust Company, ScarsdaleEastern National Bank of Long Island, SmithtownLincoln National Bank and Trust Company of Central New York, SyracuseThe Merchants National Bank & Trust Company of Syracuse, Syracuse. . .The Valley National Bank, Wallkill, N.Y., WaldenThe Citizens National Bank and Trust Company, Wellsville

00100000000810004

141000001101100

65018134011

17110011111

214






Other thanlocal

11091895315650137611377914676674410610106081516515673

8881

1560913749154161374014501

761487914761786762177455065178810

15573120085100270510105

564336190365295471534015456257713912858917914686537032919732382160145863157235013586

1427859116358

NORTH CAROLINA

The First National Bank of Albermarle, AlbemarleThe First National Bank of Asheboro, AsheboroFirst Union National Bank of North Carolina, CharlotteNorth Carolina National Bank, CharlotteThe Citizens National Bank in Gastonia, GastoniaFirst National Bank of Eastern North Carolina, JacksonvilleFirst National Bank of Lincolnton, LincolntonSouthern National Bank of North Carolina, LumbertonThe Planters National Bank and Trust Company, Rocky MountFirst National Bank of Smithfield, SmithfieldWachovia Bank and Trust Company, N.A., Winston-Salem

NORTH DAKOTA

The First National Bank of McClusky, McClusky

OHIO

Akron National Bank and Trust Company, AkronBellefontaine National Bank, BellefontaineFirst National Bank, Bowling GreenThe Citizens National Bank, BryanThe Canton National Bank, CantonFirst National Bank of Canton, CantonThe Geauga County National Bank of Chardon, ChardonSociety National Bank of Cleveland, ClevelandThe National City Bank of Cleveland, ClevelandThe City National Bank & Trust Company of Columbus, ColumbusThe Huntington National Bank of Columbus, ColumbusThe Ohio National Bank of Columbus, ColumbusThe First National Bank, Dayton, Ohio, DaytonThe Third National Bank and Trust Company of Dayton, Ohio, Dayton. .Euclid National Bank, EuclidThe Community National Bank of Flushing, FlushingThe Franklin National Bank, FranklinThe First National Bank of Georgetown, GeorgetownThe Peoples National Bank of Greenfield, GreenfieldThe First National Bank and Trust Company of Hamilton, Hami l ton . . . .The Citizens National Bank of Ironton, IrontonThe First National Bank of Jackson, JacksonThe Portage National Bank, KentThe Lancaster National Bank, LancasterTower National Bank of Lima, LimaThe Central Security National Bank of Lorain County, LorainFirst National Bank of Mansfield, MansfieldNational Bank of Montpelier, MontpelierThe First National Bank of Newark, NewarkThe Park National Bank of Newark, NewarkThe Lake County National Bank of Painesville, PainesvilleThe First National Bank and Trust Company of Ravenna, RavennaThe Citizens National Bank of Ripley, RipleyThe Farmers National Bank of Salem, Ohio, SalemThe First National Bank of Springfield, SpringfieldThe First National Bank and Trust Company of Steubenville, SteubenvilleFirst National Bank of Toledo, ToledoThe First National Bank of Wapakoneta, WapakonetaThe Mahoning National Bank of Youngstown, YoungstownThe Union National Bank of Youngstown, Youngstown

OKLAHOMA

First National Bank in Blackwell, BlackwellThe First National Bank of Cleveland, ClevelandFirst National Bank in Hobart, Hobart

00021000010

11

1070

121310

19

215






Other thanlocal

Total

155831553154914514

373664572358231252635553073254505123351185084870

1399213826535158571081580

139941209825265073683694

14133920713618870700335758792223568632479105227914911058539

15422252705222264916631394783423334239

498450344879592030

Crater National Bank of Medford, MedfordFirst National Bank of Oregon, PortlandGreat Western National Bank, PortlandUnited States National Bank of Oregon, Portland

PENNSYLVANIA

The First National Bank of Allentown, AllentownThe Merchants National Bank of Allentown, AllentownCentral Penn National Bank, Bala-CynwydFirst National Bank of Somerset County, BerlinThe Cheltenham National Bank, CheltenhamSoutheast National Bank of Pennsylvania, ChesterThe First National Bank of Confluence, ConfluenceThe First National Bank of Danville, DanvilleThe First National Bank of Dushore, DushoreEaston National Bank and Trust Company, EastonThe Northampton National Bank of Easton, EastonThe First National Bank of Ebensburg, EbensburgMarine National Bank, ErieThe First National Bank in Frackville, FrackvilleValley National Bank, FreeportSouthwest National Bank of Pennsylvania, GreensburgThe Citizens National Bank of Greencastle, GreencastleThe First National Bank of Green Castle, GreencastleCommonwealth National Bank, HarrisburgTri-Valley National Bank, HeginsThe Moxham National Bank of Johnstown, JohnstownNational Bank and Trust Company of Kennett Square, Kennett Square. .The Merchants National Bank of Kittanning, KittanningLancaster County Farmers National Bank, LancasterNational Central Bank, LancasterCommercial National Bank of Westmoreland County, LatrobeCommunity National Bank of Southern Pennsylvania, LittlestownFirst Citizens National Bank, MansfieldMarine National Bank, MeadvilleSwineford National Bank, Middleburg, MiddleburgTri-County National Bank, MiddleburgThe First National Bank of Monaca, MonacaCounty National Bank of Montrose, MontroseThe Second National Bank of Nazareth, NazarethThe First National Bank and Trust Company of Newtown, NewtownThe First National Bank of Nicholson, NicholsonThe Cement National Bank, Northampton, Pa., NorthamptonThe National Bank of North East, North EastThe Columbia County Farmers National Bank of Orangeville, OrangevilleThe Philadelphia National Bank, PhiladelphiaProvident National Bank, PhiladelphiaPittsburgh National Bank, PittsburghThe Union National Bank of Pittsburgh, PittsburghWestern Pennsylvania National Bank, PittsburghThe Miners National Bank of Pottsville, PottsvillePennsylvania National Bank and Trust Company, PottsviHeScranton National Bank, ScrantonThe First National Bank of Shippensburg, ShippensburgUnion National Bank and Trust Company of Souderton, SoudertonThe First National Bank of Strasburg, StrasburgThe First National Bank of Towanda, Towanda, Pennsylvania, Towanda.The First National Bank of Troy, TroyGallatin National Bank, UniontownThe Warren National Bank, WarrenFirst National Bank & Trust Co., Washington, Pa., WashingtonThe First National Bank of Wilkes-Barre, Wilkes-Barre

119112101111101111320101

110111102112111140123131011221111

216






Other thanlocal

14921398115664

1442520441372010635144481561910660

128811059215639

14611784814760127901084213539893414279336

13681131039629

2597151964341

119716981368122

1422370931539015221106181490456831582157215315529050321025314965

RHODE ISLAND

The Newport National Bank, NewportColumbus National Bank of Rhode Island, ProvidenceIndustrial National Bank of Rhode Island, Providence

SOUTH CAROLINA

The Citizens and Southern National Bank of South Carolina, Charleston. . .The South Carolina National Bank of Charleston, CharlestonThe First National Bank of South Carolina, ColumbiaThe Peoples National Bank, GreenvilleRock Hill National Bank, Rock HillNational Bank of Commerce of Spartanburg, SpartanburgThe National Bank of South Carolina of Sumter, Sumter

SOUTH DAKOTA

National Bank of South Dakota, Sioux FallsNorthwestern National Bank of Sioux Falls, Sioux FallsUnited National Bank of Vermillion, Vermillion, South Dakota, Vermillion

TENNESSEE

American National Bank and Trust Company of Chattanooga, ChattanoogaThe Hamilton National Bank of Chattanooga, ChattanoogaHamilton First National Bank, ClintonThe National Bank of Commerce of Jackson, JacksonThe First National Bank of Sullivan County, KingsportThe Hamilton National Bank of Knoxville, KnoxvilleThe First National Bank of Lewisburg, LewisburgThe Blount National Bank of Maryville, MaryvilleThe First National Bank of Memphis, MemphisNational Bank of Commerce, MemphisThird National Bank in Nashville, NashvilleOld & Third National Bank of Union City, Union City

UTAH

First Security Bank of Utah, National Association, OgdenGranite National Bank, Salt Lake CityZions First National Bank, Salt Lake City

VERMONT

The Merchants National Bank of Burlington, BurlingtonThe Howard National Bank and Trust Company, Burlington ,The National Bank of Derby Line, Derby LineThe First National Bank of Springfield, Springfield

VIRGINIA

The Washington County National Bank of Abingdon, Abingdon ,Alexandria National Bank, Alexandria ,First Virginia Bank-Monticello National Bank, CharlottesvilleThe American Bank N.A., Falls Church ,National Bank and Trust Company, CharlottesvilleSecurity National Bank, Bailey's Cross Roads, Falls ChurchThe First National Bank of Farmville, FarmvilleThe National Bank of Fredericksburg, FredericksburgThe First National Bank of Harrisonburg, HarrisonburgFairfield National Bank of Highland Springs, Highland SpringsChesapeake National Bank, KilmarnockFirst Virginia Bank-Manassas National, ManassasMarshall National Bank and Trust Company, MarshallSuburban National Bank of Virginia, McLean

20

10

217







Total

15461101949885543811381111115530150271556711817162061236084

149901128543751323034171439411280466812292

272555514416026604431256331086

14335

VIRGINIA—continued

First National Bank of Norfolk, NorfolkUnited Virginia-Seaboard National, NorfolkVirginia National Bank, NorfolkThe National Bank of Orange, OrangeAmerican National Bank, PortsmouthFirst & Merchants National Bank, RichmondMetropolitan National Bank, RichmondRichmond National Bank, RichmondSecond National Bank of Richmond, RichmondThe Colonial-American National Bank of Roanoke, Roanoke.United Virginia Bank/National Valley, StauntonTazewell National Bank, TazewellFarmers and Merchants National Bank, Winchester

WASHINGTON

Northshore First National Bank, BothellThe First National Bank of Poulsbo, PoulsboThe National Bank of Commerce of Seattle, SeattleThe Pacific National Bank of Seattle, SeattlePacific National Bank of Washington, SeattlePeoples National Bank of Washington, SeattleSeattle-First National Bank, SeattleOld National Bank of Washington, SpokanePuget Sound National Bank, Tacoma

WISCONSIN

The First National Bank and Trust Company of Beloit, BeloitFirst Wisconsin National Bank of Fond Du Lac, Fond Du LacFirst Wisconsin National Bank of Madison, MadisonThe First National Bank of Neenah, NeenahFirst National Bank in Oshkosh, OshkoshThe First National Bank of Rhinelander, RhinelanderFirst National Bank of Sturgeon Bay, Sturgeon BayFirst National Bank of Waukesha, Waukesha

VIRGIN ISLANDS

Virgin Islands National Bank, Charlotte Amalie, St. Thomas.

115113671

218


TABLE R-20

Domestic branches of National banks closed, by States, calendar 1970


Branches closed


153312491305015330130441741156601521615488

13704

2038

14900

9381

117

4128

1510214985

153996077

149251367113739

1047115419826711131532710142

2370465

Total

CALIFORNIA

Republic National Bank and Trust Company, Beverly HillsSecurity-Pacific National Bank, Los AngelesSouthern California First National Bank, San DiegoCommonwealth National Bank, San FranciscoBank of America National Trust and Savings Association, San FranciscoCrocker-Citizens National Bank, San FranciscoWells Fargo Bank, National Association, San FranciscoCitrus National Bank, West CovinaSouthland National Bank, Yucaipa

CONNECTICUT

The Tradesmens National Bank of New Haven, New Haven

DISTRICT OF COLUMBIA

The First National Bank of Washington, Washington

GEORGIA

The Chamblee National Bank, Chamblee

INDIANA

The First-Merchants National Bank of Michigan City, Michigan City. .

IOWA

The First National Bank of Marion, Marion

MAINE

Maine National Bank, Portland

MARYLAND

National City Bank of Baltimore, BaltimoreMetropolitan National Bank of Maryland, Wheaton

MASSACHUSETTS

Commonwealth National Bank, Boston

Union National Bank, Lowell

MICHIGAN

City National Bank of Detroit, DetroitNational Bank of Detroit, DetroitCommunity National Bank of Pontiac, Pontiac

NEW JERSEY

The Clayton National Bank, ClaytonEatontown National Bank, EatontownThe Peoples National Bank of Hackettstown, HackettstownThe First National Iron Bank of New Jersey, MorristownFirst National Bank of Scotch Plains, Scotch PlainsThe National Bank of Westfield, Westfield

NEW YORK

The Chase Manhattan Bank (National Association), New YorkMarine Midland Bank of Sotheastern New York, N.A., Poughkeepsie. . .

44 60

10

40

210

011010

10

25

11

001

212111

01

219



Domestic branches of National banks closed, by States, calendar 1970


Branches closed


Total

15650137611060815673

183

59111289015333138919942

15583

593573501940115879252705694

2044940715619

14611

529011817

NORTH CAROLINA

First Union National Bank of North Carolina, CharlotteNorth Carolina National Bank, CharlotteThe Planters National Bank and Trust Company, Rocky MountWachovia Bank and Trust Company, N.A., Winston-Salem

OHIO

The First National Bank of Ashland, Ashland

OKLAHOMA

The First National Bank of Cleveland, ClevelandThe Commercial National Bank in Muskogee, MuskogeeFounders National Bank of Oklahoma City, Oklahoma CityFirst National Bank and Trust Company, Ponca CityThe National Bank of Commerce of Tulsa, Tulsa

OREGON

Crater National Bank of Medford, Medford

PENNSYLVANIA

National Valley Bank and Trust Company, ChambersburgThe Doylestown National Bank and Trust Company, DoylestownDubois Deposit National Bank, DuboisThe East Stroudsburg National Bank, East StroudsburgThe First National Bank of Monaca, MonacaPittsburgh National Bank, PittsburghThe Union National Bank of Pittsburgh, PittsburghNational Bank & Trust Company of Central Pennsylvania, York

SOUTH CAROLINA

The South Carolina National Bank of Charleston, CharlestonThe Peoples National Bank of Rock Hill, Rock HillNational Bank of Commerce of Spartanburg, Spartanburg

TENNESSEE

American National Bank and Trust Company of Chattanooga, Chattanooga

VIRGINIA

Chesapeake National Bank, KilmarnockThe Colonial-American National Bank of Roanoke, Roanoke

125111112

220


TABLE B-21Outstanding balances, credit cards and related plans of National banks, Dec. 31, 1970

Credit cards

Numberof banks

Outstandingvolume

[dollar amountsin millions]

Averagebalance

per card\

Other revolving credit plans

Numberof banks

Outstandingvolume

[dollar amountsin millions]

Averagebalance

per account %

United States


GeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisiana. . -.Maine



South Carolina. . . .South DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

688 $2,755 $211

171233226501

58

210328335430513

3451822635328

1542880

10262204

501132651666370

49

851556370*

81

123012833592129326

395084**

531

34117

1911

350760

17138*

8822

32070111173747392810

229

2832381572540

185

2600

223190221126159191268175

194198178**

199139153218177

1652142292370

268200*

215245

2230

2001862431732212302581981120

660 $753

702616251101

40

801

49131310757

334195031481416

202275645141

342

2493212175542120

11391060*

23

110

23921361

559261829

2*

28*

157261193*74

88

1420

$661

643

3165175535980

1,320

1,3380

800460370417637751395

1,092753736635542676291386

669

1,095

793486476429424

1,075

518443409**

4744933635644530

*State figures are withheld when they represent less than three banks. However, these amounts are included in the Nationaltotals.

tAverage balance for cards with outstanding balances on Dec. 31, 1970.jAverage balance for accounts with outstanding balances on Dec. 31, 1970.

NOTE: Dashes indicate amounts less than $500,000.

221


ISOIsO

TABLE B-22

Principal assets, liabilities, and capital accounts of National banks, by deposit size, year-end 1969 and 1970


1970

Deposit Size

Less than $1.01 0 to 1 92 0 to 4 95 0 to 9 910.0 to 24.925 0 to 49 950 0 to 99 9100.0 to 499.9500.0 and over

Total

1969

Deposit Size

Less than $1.01 0 to 1 92 0 to 4 95.0 to 9 9 .10.0 to 24.925.0 to 49.950.0 to 99.9100.0 to 499.9500.0 and over

Total

Numberof banks

2497

6361,1321,456

624305265

82

4,621

21120758

1,1841,403

584272253

74

4,669

Totalassets

$40184

2,5819,384

25,61624,41323,92866,737

188,023

340,906

21217

3,0709,813

24,60722,74521,30161,624

170,650

314,048

Cash andcash items

$830

3771,2873,3743,2793,366

11,81432,505

56,040

537

4561,3253,2833,1263,065

11,24632,184

54,727

Loans*

$1077

1,1764,443

12,34612,09312,09433,661

101,302

177,202

793

1,4294,761

12,22811,81111,15132,75697,466

171,702

Securities*

Total

$1862

8743,0788,2907,4796,980

17,00640,459

84,246

777

1,0133,1857,7826,7206,095

14,66230,576

70,117

U.S.Treasurysecurities

$1443

5361,5533,8013,0022,8608,470

13,944

34,223

558

6351,6433,6122,8802,5946,125

12,037

29,589

Fixedassets

$14

39160456464456

1,2143,117

5,911

12

46164437424385

1,1482,673

5,280

Deposits

Total

$18154

2,2788,373

22,85621,58021,04657,498

149,981

283,784

16187

2,7258,765

21,93920,09818,73352,977

130,982

256,426

Demand

$1494

1,1203,911

10,2579,7749,705

30,34579,902

145,122

12116

1,3824,207

10,1749,5579,066

29,75376,823

141,092

Timeand

savings

$460

1,1574,462

12,59811,80611,34127,15570,079

138,662

471

1,3434,558

11,76510,5419,666

23,22454,160

115,334

Capitalstock

$87

60187491473480

1,3263,488

6,520

26

70203488463444

1,2963,256

6,228

Capitalnotes and

deben-tures

$0003

223649

166885

1,161

0013

203942

155861

1,120

Surplus,undividedprofits, and

reserves

$1119

190578

1,4231,2701,2163 3289,159

17,194

320

218591

1,3571,1741,0653,1128,366

15,906

*Loans and securities figures are shown gross; reserves are not deducted from the respective assets.

NOTE : Data may not add to totals because of rounding.


TABLE B-23

Dates of reports of condition of National banks, 1914—70

[For dates of previous calls see Annual Report for 1920, vol. 2, table No. 42, p. 150]

Year Jon. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

1914 13 4 30 12 31 311915 4 1 23 2 10 311916 7 1 30 12 17 271917 5 1 20 11 20 311918 4 10 29 31 1 311919 4 12 30 12 17 311920 28 4 30 8 15 291921 21 28 30 6 311922 10 5 30 15 291923 3 30 14 311924 31 30 10 311925 6 30 28 311926 12 30 311927 23 30 10 311928 28 30 3 311929 27 29 4 311930 27 30 24 311931 25 30 29 311932 30 30 311933 30 25 301934 5 30 17 311935 4 29 1 311936 4 30 311937 31 30 311938 7 30 28 311939 29 30 2 301940 26 29 311941 4 30 24 311942 4 30 311943 30 18 311944 13 30 301945 20 30 311946 29 30 311947 30 6 311948 12 30 311949 11 30 1 311950 24 30 4 301951 9 30 10 311952 31 30 5 311953 20 30 30 311954 15 30 7 311955 11 30 5 311956 10 30 26 311957 14 6 11 311958 4 23 24 311959 12 10 6 311960 15 15 3 311961 12 30 27 301962 26 30 28 281963 18 29 30 201964 15 30 1 311965 26 30 13 311966 5 30 20 311967 25 30 4 301968 18 29 30 311969 '.. 30 30 21 311970 30 30 28 31

See Notes on next page.


NOTES

Act of Feb. 25, 1863, provided for reports of condition onthe 1st of each quarter before commencement of business.

Act of June 3, 1864— 1st Monday of January, April, July,and October, before commencement of business, on form pre-scribed by Comptroller (in addition to reports on 1st Tues-day of each month showing condition at commencement ofbusiness in respect to certain items; i.e., loans, specie, de-posits, and circulation).

Act of Mar. 3, 1869, not less than 5 reports per year, onform prescribed by Comptroller, at close of business on anypast date by him specified.

Act of Dec. 28, 1922, minimum number of calls reducedfrom 5 to 3 per year.

Act of Feb. 25, 1927, authorized a vice president or anassistant cashier designated by the board of directors toverify reports of condition in absence of president andcashier.

Act of June 16, 1933, requires each National bank tofurnish and publish not less than 3 reports each year ofaffiliates other than member banks, as of dates identical withthose for which the Comptroller shall during such year re-quire reports of conditions of the bank. The report of eachaffiliate shall contain such infomation as in the judgment ofthe Comptroller shall be necessary to disclose fully therelations between the affiliate and the bank and to enablethe Comptroller to inform himself as to the effect of suchrelations upon the affairs of the bank.

Sec. 21 (a) of the Banking Act of 1933 provided, in part,that after June 16, 1934, it would be unlawful for any pri-vate bank not under State supervision to continue the trans-

action of business unless it submitted to periodic examina-tion by the Comptroller of the Currency or the FederalReserve bank of the district, and made and publishedperiodic reports of condition the same as required of Na-tional banks under sec. 5211, U.S.R.S. Sec. 21(a) of the Bank-ing Act of 1933, however, was amended by sec. 303 of theBanking Act of 1935, approved Aug. 23, 1935, under theprovisions of which private banks are no longer required tosubmit to examination by the Comptroller or Federal Re-serve bank, nor are they required to make to the Comptrol-ler and to publish periodic reports of condition. (Five callsfor reports of condition of private banks were made by theComptroller, the first one for June 30, 1934, and the last onefor June 29, 1935.)

Sec. 7 (a) (3) of the Federal Deposit Insurance Act (Title12, U.S.C., sec. 1817(a)) of July 14, 1960, provides, in partthat, effective Jan. 1, 1961, each insured National bank shallmake to the Comptroller of the Currency 4 reports of condi-tion annually upon dates to be selected by the Comptroller,the Chairman of the Board of Governors of the Federal Re-serve System, and the Chairman of the Board of Directors ofthe Federal Deposit Insurance Corporation, or a majoritythereof. Two dates shall be selected within the semiannualperiod of January to June, inclusive, and 2 within the semi-annual period of July to December, inclusive, Sec. 161 ofTitle 12 also provides that the Comptroller of the Currencymay call for additional reports of conditions, in such formand containing such information as he may prescribe, ondates to be fixed by him, and may call for special reportsfrom any particular association whenever in his judgment thesame are necessary for use in the performance of his super-visory duties.


TABLE B-24

Total and principal assets of National banks, by States, June 30, 1970


United States

Alabama .Alaska.ArizonaArkansas .California.Colorado.ConnecticutDelawareDistrict of Columbia . . .Florida. . .

GeorgiaHawaiiIdahoIllinoisIndianaIowaKansas. .Kentucky . . .Louis iana . . . .Maine

MarylandMassachusettsMichigan.Minnesota. . . .Mississippi.Missouri . . . . .MontanaNebraskaNevadaNew Hampshire

New JerseyNew Mex ico . . . . . .New York . .North CarolinaNorth DakotaOhioOklahoma.OregonPennsylvaniaRhode Island

South CarolinaSouth DakotaTennesseeXexasUtahVermontVirginiaWashingtonWest VirginiaWisconsin.Wyoming . .Virgin Islands

District of Columbia—all ||. .

Numberof banks

4,638

8954

6864

12126

511

213

6218

41412399

171804920

448599

199389849

1264

50

13133

1722242

217208

10304

5

203377

5271026

1022784

12240

1

14

Totalassets

$312,621

3,351449

2,6311,574

42,6503,2832,622

352,0678,932

4,43179

99725,6986,9582,2352,6732,2043,789

684

2,7988,674

12,3106,3411,6225,144

8812,430

821699

10,5601,020

49,2264,801

76913,3444,3493,485

19,2661,643

1,492912

5,18119,251

918475

5,0475,2421,5344,330

574141

3,057

Cashassets*

$51,953

51967

340265

6,387597392

4383

1,618

86311

1373,3871,287

46042835965398

4711,6321,869

977259930116467

98111

1,352158

10,80481491

1,854781561

2,536156

260105983

3,69816153

6697252067058012

554

Securities, gross]

U.S. Gov-ernment

obligations%

$33,003

42073

156199

3,621322145

9355

1,263

2901790

3,53896133243933662256

300679

1,4797562216001283229980

1,200126

3,528381118

1,740598290

2,101165

168135550

1,9708447

543449312481

9021

502

State andlocal

$37,064

45075

264216

4,865321357

1174

1,312

4209

1483,180

677237344253453115

321950

1,3687111875431162559770

1,785124

4,747670

921,907

547435

2,541225

162109570

2,5429057

642573204470

6419

292

Other

$1,460

8155

1869

11

930

30

216028

515892

113373254

252812

722

24511

16380

7111

4

42

1972

33

14135

152

14

Loans,gross

$169,915

1,753208

1,736792

24,4731,8301,556

171,0574,059

2,50038

58813,7693,5681,1291,2791,1261,827

377

1,4814,8286,9283,623

8552,767

4841,260

450399

5,709539

26,5362,734

4417,1952,0092,022

10,9131,047

785531

2,7139,701

534297

2,9502,977

7002,445

30774

1,576

Federalfundssold§

$6,544

957

3241

83662723

35342

11404

525262209469

10715

137129252

5640

1295

484320

17941

487164

258223

8487

3

651

189501

147

74234

58801110

48

Directlease

financing

$759

1

29641026

1100

68131112

34913190

21

_

0

31

16060

1486

20

0

263

1328

0

2

*Cash, balances with other banks, and cash items in process of collection.tIncludes investment securities and securities held in trading accounts.{Includes U.S. Treasury securities and obligations of other U.S. Government agencies.§Also includes securities purchased under agreements to resell.||Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the


TABLE B-25

Total and principal liabilities of National banks, by States, June 30, 1970


Totalliabilities

Deposits

Totaldeposits

Demanddeposits,

total

Time andsavings

deposits,total

DemanddepositsIPC*

Timedeposits

IPC

Federalfunds pur-

chasedf

Reserveson loans

andsecurities

United States






District of Columbia—allj

$284,710 $254,382 $133,342 $121,040 $98,207 $105,859 $11,346

3,023416

2,4281,422

39,4582,9992,389

321,8758,173

3,99773920

23,2516,3812,0432,4011,9983,415619

2,5597,86311,3345,8101,4754,608812

2,204753622

9,640934

44,6344,367705

12,1023,9113,21817,2911,491

1,361836

4,71117,466

842435

4,6064,8051,3803,971518133

2,899408

2,3261,369

34,8172,7612,255

311,8177,726

3,39671873

20,1765,9281,9782,3091,9253,236586

2,3836,39810,4575,0811,3724,140758

2,043732578

9,205890

36,0383,904675

11,2083,6773,03015,9151,277

1,288805

4,37815,871

760422

4,3214,2771,3113,679500121

1,568201

1,025762

14,7871,5171,253

141,1214,175

2,09326403

10,5983,0771,0761,2901,0621,837294

1,3924,5694,0762,613796

2,648315

1,142330354

4,185482

23,2802,184265

5,1532,1701,3017,370571

916329

2,2999,449345154

1,9162,003634

1,65123632

1,331207

1,302607

20,0301,2441,002

17696

3,551

1,30344470

9,5772,852902

1,019863

1,399292

9911,8296,3822,468576

1,492443901402223

5,020408

12,7581,720410

6,0551,5071,7288,544706

371476

2,0796,421414268

2,4052,275676

2,02926488

1,197161815583

11,9761,1551,040

13981

3,093

1,52922315

7,7232,040700846867

1,348246

1,0453,1373,1671,739533

1,833244807263287

3,396359

15,0391,653217

3,9651,5601,0835,916443

738261

1,5256,819264130

1,5541,662483

1,25316815

1,237109

1,184565

16,6371,07294117

6743,180

1,16426446

8,3652,695851870823

1,126281

9671,5365,4942,370501

1,401410874330218

4,860338

10,0191,473390

5,6311,2901,5297,749700

351433

1,7105,210367262

2,2712,125663

1,82723957

2,774 2,657 1,601 1,056 1,412 1,005

2502528

1,85011725015

213

356012

981226242728748

92456266389623421812307

8515

2,3462078

41315553

480150

63

148904521

111289309360

57

*IPC deposits are those of individuals, partnerships, and corporations.fAlso includes securities sold under agreements to repurchase.{Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the

Currency.NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000.


TABLE B-26

Capital accounts of National banks, by States, June 30, 1970


Totalcapital

accountsDebentures

Preferredstock

Commonstock Surplus

Undividedprofits

Capitalreserves

United States






District of Columbia—all*

$24,112 $1,136 $63 $6,357 $10,438 $5,437

28827177138

2,6752512023

171684

384567

2,06750917025018133558

211700829465129481581996169

79876

3,82437554

1,097399230

1,746135

11463418

1,5686636388377139307517

——266

1935120130

542026427080

32212223627130—

391

2805022821061—

01194101202420

041

000

070

000101000000

849

3736

7017450

139

223

762

196161224168377620

5215520213032

11622482214

21524

9957416

29510680

36029

2518

1085002110

11611330876

120107252

1,163103104

181

274

1361

33903227669894

17320

9634031816383

17722672137

35424

1,71916420

50213783

85873

5424

173620

3413

16914168

125244

256 13 50 113

728

4340

5756736

147

138

841

153741485774467516

52155169143

715112771817

17415

6408315

26613267

40533

3219

109361

1111

1011123580182

76

•Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of theCurrency.NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000.

227


TABLE B-27

Total and principal assets of National banks, by States, Dec. 31, 1970


Numberof banks

Totalassets

Cashassets*

Securities, grossf

U.S. Gov-ernment

obligations'^

Stateand local Other

Loans,gross

Federalfundssold§

Directlease

financing

United States





South Carolina ,South DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyoming ,Virgin Islands


4,621 $340,906 $56,040 $40,905 $41,542 $1,800 $177,202 $10,436

8953696012226511

215

6217

41412299171804919

4286101199389849125448

12933169224221720310

2995

19337753010261012585125411

3,792484

2,8971,759

45,9383,6762,913

392,21910,196

4,63982

1,06627,8217,7582,4632,9282,4954,161730

2,9359,36913,4836,9381,7335,953978

2,643884768

11,5311,135

51,5655,376836

14,3494,9143,86521,1351,696

1,6521,0035,77022,0881,021521

5,5235,9051,6964,799646141

65571341338

6,6006914444

3912,078

84110131

3,8961,534519493432784108

5441,7142,2071,204276

1,250123519103116

1,518189

9,063903100

2,101913606

3,154170

314125

1,1284,291

1815873789522283810412

51275209243

5,23339716310

3741,503

33514110

4,2401,10737854140071571

325958

1,6831,016254770175383127103

1,489137

4,623526155

2,148649362

2,372116

218161636

2,455975062759034458911721

55998356228

5,0023605151

2091,509

4368

1803,36275726535327247596

3931,1041,59774719361812927411466

1,947165

5,644807104

2,052639574

2,942236

184132658

2,762104597236962195297019

8274

2471013

1128

34

3170258327102

911175156253612

813

309171

73968

1274

72201105317146202

1,810216

1,875818

25,3491,9601,668

191,0724,297

2,54044606

14,2683,6681,1701,3211,1751,902401

1,4884,8597,4443,643

8962,830

4981,318

485409

5,927572

28,3152,843

4437,1752,1042,104

11,0281,101

814545

2,90910,591

572318

3,1502,998

7442,508

31774

13821

671,221

111103

102441

21337

67848667

10715116032

9521110910951

30824731952

28038

7967312

44839541

93723

629

2401,123

3021

1064461101701410

14 3,233 571 531 326 17 1,576 134

*Cash, balances with other banks, and cash items in process of collection.•("Includes investment securities and securities held in trading accounts,jlncludes U.S. Treasury securities and obligations of other U.S. Government agencies.§Also includes securities purchased under agreement to resell.||Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the

Currency.


TABLE B-28

Total and principal liabilities of National banks, by States, Dec. 31, 1970


United States

AlabamaAlaskaArizonaArkansasCaliforniaColorado . . . .Connect icut . . .DelawareDistrict of ColumbiaFlorida

Georgia . .HawaiiIdahoIllinoisIndianaIowaKansas . .Kentucky .LouisianaMaine

Maryland .Massachusetts.Michigan . . .MinnesotaMississippiMissouriM̂ on tan aNebraskaNevada.New Hampshire. . . . .

New Jersey.New MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvania.Rhode Island

South CarolinaSouth DakotaTennessee. .TexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

District of Columbia—allj

Totalliabilities

$312,194

3,457449

2,6911,601

42,6713,3792,674

362,0229,398

4,19676

98525,344

7,1612,2642,6432,2813,779

663

2,6918,524

12,4776,3901,5815,406

9062,418

813688

10,5721,045

46,8844,913

77013,0704,4693,594

19,0951,541

1,517922

5,28020,232

943480

5,0685,4531,5374,424

588133

2,942

Deposits

Totaldeposits

$283,784

3,302437

2,5331,558

38,8293,1412,504

351,9518,957

3,70574

94122,3626,5022,1872,5292,1983,614

630

2,5397,178

11,3635,8581,4934,853

8622,323

788636

10,1341,003

39,6104,516

74212,2684,1873,367

17,8041,434

1,415892

4,90618,385

872467

4,7494,8511,4464,168

569121

2,851

Demanddeposits,

total

$145,122

1,829197

1,053890

15,7371,6711,374

151,1814,871

2,28531

43911,4453,4671,1811,4331,2582,071

315

1,4704,8114,4623,001

8663,201

3691,340

348397

4,692514

23,0512,479

3065,6022,3991,3588,467

581

1,020369

2,63010,714

402173

2,1022,284

7051,956

27832

1,717

Time andsavings

deposits,total

$138,662

1,473241

1,480667

23,0921,4701,131

20770

4,086

1,42043

50210,9173,0341,0051,096

9391,543

314

1,0682,3676,9012,857

6271,652

493983440239

5,442489

16,5582,038

4366,6661,7882,0099,337

853

395524

2,2767,671

470294

2,6472,567

7412,212

29188

1,134

DemanddepositsIPC*

$107,768

1,319159883669

13,1141,2851,157

141,0153,457

1,65124

3408,4942,200

781938992

1,501266

1,1303,4313,3631,970

6072,054

277925287304

3,752395

15,4771,935

2444,3901,7341,1406,740

484

827295

1,7457,659

315143

1,7501,910

5391,471

20015

1,488

Timedeposits

IPC

$119,843

1,349121

1,308614

18,6911,2781,019

20743

3,474

1,25529

4719,7072,901

942948881

1,286296

1,0172,0095,8572,653

5521,575

447950364230

5,165380

13,3121,655

4156,0641,5161,6518,467

805

372469

1,9426,176

392281

2,4562,339

7211,963

25957

1,099

Federalfunds

purchased f

$11,830

470

7216

1,675100510

26181

27402

1,453399364537568

6574736030343

4339

520

10

6113

1,741992

35917373

63843

191

1851,238

280

125418

4467

40

30

Reserveson loans

andsecurities

$3,836

406

2715

5133431

2077

51

10376

6824222643

8

281131496621531127

78

12411

773589

1444038

23417

181351

22695

55611552

51

27

*IPC deposits are those of individuals, partnerships, and corporations.fAlso includes securities sold under agreements to repurchase.{Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the

Currency.NOTE: Data mav not add to totals because of rounding. Dashes indicate amounts less than $500,000.


TABLE B-29

Capital accounts of National banks, by States, Dec. 31, 1970


United States

AlabamaAlaskaArizonaArkansasCaliforniaColorado .ConnecticutDelawareDistrict of ColumbiaFlorida

Georgia. . .HawaiiIdahoIllinoisIndianaIowa. . . . . .Kansas. .KentuckyLouisianaMaine

MarylandMassachusettsMichigan . . . .Minnesota. .Mississippi. .MissouriMontanaNebraskaNevadaNew Hamsphire . .

New JerseyNew Mex ico . . .New YorkNorth CarolinaNorth Dakota. .OhioOklahoma .OregonPennsylvaniaRhode Island . .

South CarolinaSouth DakotaTennesseeTexasUtahVermont.VirginiaWashingtonWest VirginiaWisconsinWyomingVirgin Islands

District of Columbia—all *

Totalcapital

accounts

$24,875

29629

179143

2,754263208

3176721

3926

712,101

53017526218733959

216732857483132494

611986372

83579

3,908404

561,135

405232

1,806138

11767

4391,631

6937

401391144322536

264

Debentures

$1,161

1

257

1879

1201

31

5320

28427080

323

121246

27130

391

27265

22822

061

01

195601202420

13

Preferredstock

$63

OO

OO

0

0020

000

001030

0040030

00

041

000

070

000

oo

oo

oo

— o

—

2

Commonstock

$6,457

859

3537

7027450

139

227

772

196161234269387621

5116220713133

11622512214

22224

1,001102

1629710680

37229

2420

1145062210

1171143093

6

51

Surplus

$10,659

123108055

1,220110112

192

298

1381

3797023768

10295

17121

9734834817689

17923742138

36424

1,49216520

54513893

91573

5326

181626

3613

17214870

142244

124

Undividedprofits

$5,864

779

3940

5946834

142

146

861

153401576080508117

57172164146

2161

15662018

19114

9916916

26113660

39936

361999

3951212

1081183778182

73

Capitalreserves

$671

10104

511

119

3700

147843411

82814617

3

1

1816

1104243

53

41

2647

012

10551

2

"Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of theCurrency.NOTE: Data may not add to totals because of rounding. Dashes indicate amounts less than $500,000.

230


TABLE B-30

Loans of National banks, by States, Dec. 31, 1970


LoansLoanssecuredby realestate

Loans tofinancial

institutions

Loans topurchaseor carry

securities

Loans tofarmers

Commercialand

industrialloans

Personalloans to

individualsOtherloans

United States






District of Columbia—all*

$177,202 $41,561 $11,447 $5,032 $5,438 $70,080 $38,740

1,810216

1,875818

25,3491,9601,668

191,0724,297

2,54044606

14,2683,6681,1701,3211,1751,902401

1,4884,8597,4443,643896

2,830498

1,318485409

5,927572

28,3152,843443

7,1752,1042,10411,0281,101

814545

2,90910,591

572318

3,1502,998744

2,50831774

30591497207

7,52139054911

327993

44117160

2,5771,150290195304341133

431726

2,888959186514130154174110

2,33986

4,362327142

2,076366517

3,019472

105129418

1,186205150938

' 7352428616646

76

16524

1,4431331491

121183

170

81,3122033543611345

10950156822433238438176

19213

2,480973

31212710854954

314

182858221

981742011550

1,576 477 200

23

1818

327214301375

25

654674232810411

3638219112191021

5771

534

1,944431

8953171044

81

51629134343055630=25

360

193577272322

55

23

1013508723530770218

184521883611810343494

11569J327988231101136

131774650126866161965700

64569485245

10,1225904522

3251,494

90320138

6,8061,019301397305792131

4512,6052,1091,296277

1,203120323128129

1,654199

15,0001,324119

2,064709956

4,199347

291120

1,2084,694

17066796

1,1991598179217

0 432

65655

498258

4,5245464274

2541,405

9197

1852,3071,053273338391522116

397872

1,349814316622137297147151

1,492187

3,70194796

2,296525387

2,590208

319107943

2,30912784

1,0456533004947910

394

*Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of theCurrency.NOTE: Data may not add to totals because of rounding. Dashes indicate amounts of less than $500,000.

231


N3TABLE B-31

Income and expenses of National banks, * by States, year ended Dec. 31, 1970

[Dollar amounts in thousands]

United States Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware

Number of banks

Operating income:Interest and fees on loansIncome on Federal funds sold and securities pur-

chased under agreements to resellInterest and dividends on investments:

U.S. Treasury securitiesSecurities of other U.S. Government agencies and

corporationsObligations of States and political subdivisions.Other securities

Trust department incomeService charges on deposit accountsOther service charges, collection and exchange


Total operating income

Operating expense:Salaries and wages of officers and employeesPensions and other employee benefitsInterest on depositsExpense of Federal funds purchased and securities

sold under agreements to repurchaseInterest on borrowed moneyInterest on capital notes and debenturesOccupancy expense of bank premises, netFurniture and equipment, depreciation, rental costs,

servicing, etcProvision for loan losses (or actual net loan losses). .Other operating expenses


Income before income taxes and securities gains or losses.Applicable income taxesIncome before securities gains or lossesNet securities gains or losses (after tax effect)Net income before extraordinary itemsExtraordinary charges or creditsMinority interest in consolidated subsidiaries

Net income

4,621 89 69 60 122 26

$13,698,354

602,927

1,654,123

326,9901,535,309

90,675626,202686,411

534,791677,949

20,433,731

3,838,556625,174

6,215,245

937,495169,78055,165723,788

546,553405,564

2,784,676

16,301,996

4,131,7351,239,9312,891,804-64,512

2,827,292+2,081

-39

2,829,334

$145,157

8,161

22,595

3,56719,139

5325,23811,757

5,9442,847

$19,375

1,001

2,428

2,1783,875

60232

2,442

2,373505

$148,376

881

8,337

1,88612,165

2234,3888,579

3,7414,402

$63,185

4,448

10,009

2,3858,722225

1,2794,709

1,3531,199

$2,038,079

75,901

179,161

39,720182,35513,22076,872127,822

106,260117,035

$162,192

6,354

17,608

3,10813,968

63611,27012,709

10,2484,203

$125,582

3,427

5,465

2,15017,953

67610,7687,468

4,3373,446

224,937 34,469

46,6257,656

64,141

2,54145427

6,928

7,4867,00126,971

8,6001,04511,188

1709

1,371

1,2851,3013,867

192,978

44,0707,736

67,647

5,1020

1,0436,907

6,2693,19920,140

97,514 2,956,425 242,296 181,272

20,2772,71029,589

2,067258311

4,241

3,6223,70212,283

594,28090,819

1,081,466

130,07829,7188,884

119,882

58,37253,542351,795

51,0317,04564,501

7,4533,333506

8,680

8,8526,44837,533

46,0607,871

46,397

2,7081,225551

9,397

5,9442,81122,340

169,830 28,683 162,113 79,060 2,518,836 195,382 145,304

55,10718,03637,071

+29937,370+ 103

0

5,786862

4,924+98

5,022- 4

0

30,8659,677

21,188+83

21,27100

18,4544,874

13,580-584

12,996+484

0

437,589128,921308,668-3,447305,221

-2830

46,91415,94030,974

-23630,738

+ 3030

35,96810,73925,229

+5025,279

-1170

37,473 5,018 21,271 13,480 304,938 31,041 25,162

$1,274

204

409

1063660

84

3834

2,191

51163

712

000

85

743

265

1,713

478146332+4336

00

336


Changes in capital accounts:Increases:

Net income transferred to undivided profits . . . .

Capital stock, notes and debentures sold orissued, including premium received

Addition to surplus, undivided profits and re-serves incident to mergers and consolidations.

Transfers from reserves on loans and securities. .All other increases

Total increases

Decreases:Cash dividends declared:

On common stockOn preferred stock

Capital stock, notes and debentures retired,including premium paid

Reduction in surplus, undivided profits and re-serves incident to mergers and consolidations.

Transfers to reserves on loans and securities. . . .All other decreases

Total decreases

Net change in capital accounts

Capital accounts!

Ratios:Net income before dividends to capital accounts

(percent)

Total operating expense to total operating rev-enue (percent)

See footnotes at end of table.

2,829,334

327,335

135,79728,217148,007

639,356

1,273,0394,677

82,861

27,779153,010158,364

1,699,730

1,768,960

24,080,719

11.75

79.77

37,473

3,708

254228

2,940

7,130

14,6040

0

49702

3,321

18,676

25,927

284,542

13.17

75.50

5,018

0

0127181

308

8380

20

13093195

1,276

4,050

27,212

18.44

83.21

21,271

16,439

000

16,439

8,2150

367

0563539

9,674

28,036

170,226

12.50

84.00

13,480

2,707

175111

2,492

5,485

3,8030

78

01,0511,591

6,523

12,442

136,797

9.85

81.07

304,938

11,835

3,1561,3222,764

19,077

153,7010

7,271

4,4135,6016,978

177,964

146,051

2,692,094

11.33

85.19

31,041

7,072

0141

2,370

9,583

12,24765

62

02,3701,637

16,381

24,243

250,004

12.42

80.63

25,162

3,997

4,0745331

8,155

14,2950

0

350775329

15,749

17,568

200,560

12.55

80.15

336

176

0048

224

870

01919

125

435

2,975

11.30

78.18





District ofColumbia

Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas

Number of banks













Net income

11 215 62 1 414 122 99

$86,804

5,755

20,217

2,8047,091654

5,3485,891

1,8781,832

138,274

30,5383,49935,930

1,2831,171

555,280

3,8862,19920,025

103,866

34,40814,00620,402+ 751

21,153-378

0

20,775

$343,755

29,721

52,743

23,49257,9101,72317,06324,692

22,87912,444

$238,951

11,539

15,272

2,96419,0761,29610,06616,857

5,43016,290

$3,849

156

1,074

13975013

22833

$49,343

935

5,515

1917,147101500

3,647

1,888290

1,050,538

39,346

162,193

39,999132,5469,25662,79129,774

26,43584,523

$278,060

20,082

46,290

11,12028,6661,28612,29414,652

11,1137,999

$87,263

3,843

16,364

3,9549,616357

3,3464,788

5,1431,579

586,422 337,741 5,756 69,557 1,637,401 431,562 136,253

112,62315,141177,412

16,0241,5581,70815,799

20,20314,43084,979

75,11413,04765,280

18,78521,2741,93413,520

11,44712,20742,744

1,369158

2,470

9075336

155175693

14,7292,23722,300

3135150

1,509

1,8441,1827,810

253,88945,420487,140

109,51129,2431,605

52,753

33,96839,270238,571

81,47812,875133,172

18,5902,820

7215,682

13,63710,07947,206

26,5313,58243,735

2,72535797

4,364

6,8241,77916,219

459,877 275,352 5,440 52,439 1,291.,370 335,611 106,213

171

$102,673

6,615

23,211

4,95913,942

3292,7916,913

5,6442,650

126,54532,66993,876-2,23391,643+564

0

62,38920,48041,909

-90641,003

-6340

31642

274+92366

00

17,1185,536

11,582- 6 2

11,52000

346,031100,671245,360

-13,827231,533-2,185

- 1 8

95,95130,43365,518

-56264,956

- 8 90

30,04010,30019,740+251

19,991+47-18

92,207 40,369 366 11,520 229,330 64,867 20,020

169,727

32,1234,304

51,223

2,996991468

5,179

5,3984,241

19,573

126,496

43,23113,76229,469

- 6 529,404

- 2 60

29,378Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis


Net income transferred to undivided p ro f i t s . . . .




Total increases





Transfers to reserves on loans and securit ies. . . .All other decreases

Total decreases


Capital accounts f


(percent)



20,775

502

077

272

851

8,626638

31

0- 4 0478

9,733

11,893

170,544

12.18

75.12

92,207

20,857

1,150696

4,257

26,960

28,1920

3,806

5003,8833,240

39,621

79,546

681,605

13.53

78.42

40,369

29,576

79979

2,245

32,699

19,5290

2,711

04,1702,913

29,323

43,745

374,406

10.78

81.53

366

800

80

286

5,210

7.02

94.51

11,520

713

2,0870

37

2,837

3,5880

0

0208

15

3,811

10,546

66,877

17.22

75.39

229,330

7,184

4503,799

25,047

36,480

110,0005

307

24613,82724,668

149,053

116,757

2,052,706

11.17

78.87

64,867

2,341

1,7731,6774,188

9,979

20,1580

3,466

12,1523,021

28,798

46,048

507,184

12.79

77.77

20,020

646

22368

2,321

3,258

6,7480

0

3001,2692,434

10,751

12,627

169,485

11.81

77.95

29,378

976

80479

4,907

6,766

9,21618

55

25981

5,752

16,047

20,097

251,694

11.67

74.53

ISO





Kentucky Louisiana Maine Maryland Massa-chusetts

Michigan Minnesota Mississippi Missouri

Number of banks













Net income

80 49 19 42

$87,756

5,955

18,629

2,30610,933

3722,1535,023

2,2201,490

136,837

27,6963,955

40,697

1,981173

04,513

4,4343,313

17,102

103,864

32,97310,32222,651

+27122,922

4-1890

23,111

$147,394

9,068

32,507

4,78118,122

6132,578

10,1047,0253,258

$31,896

1,569

3,250

1674,152

1001,6791,734

1,238640

$118,621

8,947

16,695

2,505'13,659

5733,6638,198

2,6462,158

86

$405,348

19,223

44,342

4,06236,1851,794

39,24017,217

23,02320,459

101 199 38 98

$535,165

16,880

75,666

10,27357,7454,59820,60021,478

13,54113,275

$276,653

6,763

31,702

8,68128,229

72614,32512,475

15,37618,569

$71,523

2,844

10,692

1,2527,565264

1,3656,119

3,4764,404

235,450 46,425

42,9146,38569,695

6,4252,113305

9,112

7,9045,60029,510

10,7811,63612,950

6151230

1,899

2,036708

6,692

177,665

37,8195,65241,222

5,529948163

7,823

6,1923,09224,272

610,893

128,82321,477101,859

47,55510,1651,102

24,227

16,22312,680111,451

769,221 413,499 109,504

134,15422,457318,019

25,9745,4246,03227,826

20,5369,06965,729

67,85411,306128,098

27,6518,8641,27110,071

15,6464,66845,947

20,4643,21726,608

5,066105298

3,312

3,8674,14516,463

179,963 37,440 132,712 475,562 635,220 321,376 83,545

55,48719,52335,964+938

36,902+92

0

8,9851,7327,253-1687,085

g0

44,95315,87629,077+771

29,848-17

0

135,33152,89682,435-354

82,081-646

0

134,00138,01795,984-3,25892,726+ 189

0

92,12334,43157,692-859

56,833-57-1

25,9598,27917,680+ 12917,809-149

0

36,994 7,076 29,831 81,435 92,915 56,775 17,660

$217,186

11,015

33,612

4,37521,688

94413,2566,384

7,96016,213

332,633

57,3158,73778,679

32,1391,5031,2729,293

8,9775,56637,209

240,690

91,94334,90757,036

+39357,429+282

0



Net income transferred to undivided prof i ts . . . .




Total increases





Transfers to reserves on loans and securities....All other decreases

Total decreases


Capital accounts t


(percent)



23,111

1,006

98149

1,826

3,079

7,2230

0

01,7631,853

10,839

15,351

180,031

12.84

75.90

36,994

978

34752

1,524

3,288

12,518140

150

06,137

874

19,819

20,463

331,178

11.17

76.43

7,076

3,505

47024

273

4,272

3,2050

0

1,421331115

5,072

6,276

57,584

12.29

80.65

29,831

1,801

1,326153935

4,215

10,0700

133

01,1371,253

12,593

21,453

209,764

14.22

74.70

81,435

3,115

1,512113909

5,649

37,5090

40

504,1921,935

43,726

43,358

705,344

11.54

77.85

92,915

10,151

979153

2,967

14,250

30,782220

1,326

03,0454,149

39,522

67,643

825,290

11.26

82.58

56,775

3,965

524298

3,784

8,571

22,4820

372

4251,9541,876

27,109

38,237

463,786

17,660

1,330

6588

1,459

3,383

7,0800

50

02,0571,818

11,005

10,038

127,434

13.86

76.29

57,711

1,029

833,3761,698

6,186

23,371204

0

06,7622,852

33,189

30,708

479,068

12.05

72.36


ISOGO00 TABLE B-31—Continued

Income and expenses of National banks, * by States, year ended Dec, 31, 1970


Montana Nebraska Nevada NewHampshire

NewJersey

NewMexico

NewYork

NorthCarolina

NorthDakota

Number of banks













Net income

49 125 48 129 33 169

$38,417

1,225

6,698

1,1474,898137346

2,995

1,707492

58,062

10,5061,820

21,996

1,49615853

1,712

1,798517

7,940

47,996

10,0662,5057,561-66

7,495-205

0

7,290

$102,858

6,143

14,471

4,99910,624

3484,2715,113

5,9195,143

$39,116

2,983

5,634

1,0654,141

791,5292,936

9461,617

$33,222

2,288

4,894

2533,097160806

3,115

5231,031

$429,028

19,571

57,072

14,77374,4574,47815,88528,139

9,2239,027

$45,526

2,825

6,554

9405,619259

1,2503,766

2,567706

$2,116,299

60,954

182,731

21,528203,53618,929106,73564,833

72,041184,965

22=====

$234,235

3,510

17,130

7,86329,193

53311,27712,214

9,86813,730

159,889

31,8754,67444,125

6,239317167

5,550

7,3432,41221,310

60,046

12,1151,52019,314

21600

2,304

1,4872,1497,071

49,389

11,3291,73310,453

5796728

2,095

1,502912

8,041

661,653

133,25923,274225,058

4,9621,7051,960

27,727

18,5297,54376,651

70,012 3,032,551 339,553

14,0601,796

20,875

1,18521570

2,209

2,1542,3638,814

519,907102,277746,531

190,3639,06613,461117,439

59,37564,560623,198

80,33914,18491,002

11,1761,3902,769

13,102

12,3645,364

39,822

124,012 46,041 36,739 520,668 53,741 2,446,177 271,512

35,87711,58524,292

- 2 824,264

-1780

14,0054,8379,168+98

9,266- 7 7

0

12,6504,2768,374+2808,654+327

0

140,98528,874

112,111-1,894110,217

-3520

16,2715,548

10,723+80

10,803+ 17

0

586,374170,801415,573

-25,639389,934+3,395

0

68,04120,60447,437

-38447,053

- 1 20

24,086 9,189 8,981 109,865 10,820 393,329 47,041

49,380

8,1561,376

20,668

19278

1231,312

1,539645

5,010

39,099



Net income transferred to undivided profits....




Total increases






Total decreases


Capital accounts t


(percent)



7,290

0386468

860

3,5960

0638149

4,388

82.66

24,086

350

062

3,018

3,430

15,3436

0

821,3692,315

19,115

3,

58,

12

762

847

.39

8,

195,

12

401

360

.33

77.56

9,189

00

77

77

2,9660

0

040847

3,421

5,845

60,560

15.17

76.68

8,981

190

65961

564

1,474

2,8490

0

0348581

3,778

6,677

68,989

13.02

74.39

109,865

23,560

28,985578

4,298

57,421

49,6113

0

6173,2065,746

59,183

108,103

794,456

13.83

78.69

10,820

39

014

634

687

4,1400

55

0100

1,012

5,307

6,200

75,845

14.27

76.76

393,329

20,262

21,3892,008

13,567

57,226

260,0572,936

16,053

1,79927,3648,379

316,588

133,967

3,836,879

10.25

80.66

47,041

29,964

4,374188

1,363

35,889

18,2630

10,000

2,8922,039

733

33,927

49,003

378,532

12.43

79.96

7,072

617

3143

261

952

2,5240

0

0266519

3,309

4,715

53,754

13.16

79.18





Ohio Oklahoma Oregon Pennsylvania RhodeIsland

SouthCarolina

SouthDakota

Tennessee Texas

Number of banks





Trust department income ;Service charges on deposit accountsOther service charges, collection and exchange





servicing, etcProvision for loan losses (or actual net loan losses)..Other operating expenses



Net income

217 203 10 299 19 33 77 530

$552,955

26,806

97,140

13,82981,0533,995

21,34427,550

18,75213,097

856,521

152,77020,382

287,928

33,3104,9371,396

26,973

22,49714,528

105,347

670,068

186,45347,685

138,768-3,445135,323

+5120

135,835

$162,202

15,072

33,035

2,41021,2664,0575,45210,682

6,6154,530

$172,624

2,609

13,680

2,16319,397

3085,65114,167

5,9162,642

$842,748

36,719

108,055

16,708102,8066,57447,80423,528

26,12025,708

$84,105

803

5,246

7788,991266

7,4131,473

2,8742,507

$68,174

2,327

7,462

3,5186,567

1672,2766,519

1,8793,834

$40,867

676

7,218

1,3304,931

136775

3,052

1,939861

$223,700

15,684

27,201

4,26923,017

9407,35811,628

8,8449,201

$802,327

55,185

91,607

25,312104,6654,60533,13639,991

26,75225,929

265,321 239,157 1,236,770

50,2446,76275,917

12,682955

1,0026,313

7,6486,92531,971

54,9158,57289,577

5,1751,139

09,630

6,0803,45622,344

207,80738,016

410,154

42,6655,1263,603

40,266

31,72114,008151,979

114,456

19,2674,50534,943

5,7132,425

223,773

2,9522,41114,353

102,723 61,785 331,842 1,209,509

27,6054,92715,761

939360

3,484

4,2161,29015,737

10,6661,853

24,566

1757636

1,931

2,0921,0155,863

63,23210,045104,739

15,0201,157916

10,362

11,7138,02139,995

205,69628,972354,497

83,28812,5081,170

31,769

36,35634,856143,893

200,419 200,888 945,345 90,364

64,90218,97145,931

+47646,407

+231- 4

38,26910,72427,545

+21427,759

00

291,42581,401

210,024-9,769200,255

+4090

24,0927,654

16,438-578

15,86000

73,995

28,72810,83517,893

-5417,839

+380

48,363

13,4224,2619,161

-539,108+ 10

0

265,200 933,005

66,64220,07946,563

-65345,910

+49+3

276,50482,775

193,729-413

193,316-495

0

46,634 27,759 200,664 15,860 17,877 9,118 45,962 192,821Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis


Net income transferred to undivided profi ts . . . .




Total increases






Total decreases


Capital accounts f


(percent)



135,835

7,748

2,1534,0634,473

18,437

53,5890

0

1,0417,5963,298

65,524

88,748

1,092,730

12.43

78.23

46,634

1,943

1,874113

4,531

8,461

19,16221

46

02,0166,843

28,088

27,007

398,808

11.69

75.54

27,759

3012

18

12,4230

0

01,1634,891

18,477

9,300

228,587

12.14

84.00

200,664

33,351

17,953621

11,268

63,193

88,786361

183

3,4876,69019,591

119,098

144,759

1,748,710

11.47

76.44

15,860

200

50018

268

8,7090

13

01,023202

9,947

6,181

134,562

11.79

78.95

17,877

0

046231

277

7,0340

0

01,273583

8,890

9,264

113,447

15.76

72.03

9,118

901

1,355142962

3,360

3,6850

25

0464692

4,866

7,612

63,147

14.44

78.28

45,962

2,269

1362,4927,232

12,129

14,9050

25

02,7343,541

21,205

36,886

419,639

10.95

79.91

192,821

50,629

3,6102,51117,245

73,995

71,03132

35,111

3,35720,13516,482

146,148

120,668

1,564,560

12.32

77.14


TABLE B-31— Continued

Income and expenses of National banks, * by States, year ended Dec, 31, 1970


Utah Vermont Virginia Washington WestVirginia

Wisconsin Wyoming VirginIslands

District ofColumbia—all%

Number of banks













Net income

10

$45,454

1,219

4,758

8484,626

1671,1593,617

2,696474

65,018

11,4111,512

21,286

2,5591,390

01,677

1,625980

7,805

50,245

14,7735,4099,364

+429,406

00

9,406

26 101 25 85 125 41 1

$22,989

947

2,483

3072,250

168363

1,417

384514

$246,904

6,420

28,279

6,61626,270

7579,182

12,51511,4594,986

$256,588

21,871

23,761

2,56425,0581,41710,25322,842

13,77812,118

$52,996

5,258

15,219

2,9628,071311

1,7111,871

1,1471,408

$184,459

9,192

24,919

6,15520,4501,1366,1396,594

8,39410,597

$25,778

872

5,435

4822,757102314

1,923

1,189455

$6,493

359

1,046

0826100

155

269278

31,822 353,388 390,250 90,954 278,035 39,307 9,436

6,646975

12,656

973743

1,254

1,106342

3,556

72,47610,656117,207

5,8862,058

822,308

12,2306,28446,790

91,18213,194113,610

30,7645650

15,966

11,6935,87643,738

15,7461,901

30,398

2,18657105

2,841

2,4811,23011,186

50,1569,081

101,971

7,3741,313254

9,582

9,6413,80529,067

7,724939

12,837

312243117

1,510

1,2431,4804,937

1,799198

4,046

03670

297

8792869

26,712 286,390 326,588 68,131 222,244 31,342 8,755

5,1101,2553,855

-473,808

+940

66,99817,95849,040

-1,52147,519

+ 1300

63,66218,76344,899

+ 75345,652

- 4 2- 1

22,8236,774

16,049-152

15,897-437

0

55,79118,06537,726

+50038,226

+ 1,0050

7,9652,1195,846+2126,058

+ 70

681+65746+4750

00

3,902 47,649 45,609 15,460 39,231 6,065 750

14

$126,080

6,626

28,417

3,16111,472

7258,9638,758

2,6312,094

198,927

41,6414,901

53,459

2,2391,248

6498,851

5,3502,910

25,593

146,841

52,08621,11030,976+909

31,885-378

0



Net income transferred to undivided profits


Addition to surplus, undivided profits and re-serves incident to mergers and consolidations. .

Transfers from reserves on loans and securities. . .All other increases

Total increases




Reduction in surplus, undivided profits and re-serves incident to mergers and consolidations. .

Transfers to reserves on loans and securitiesAll other decreases

Total decreases


Capital accounts f


(percent)


9,406

26

00

195

221

4,1070

0

1,771390244

6,512

3,115

66,918

14.06

77.28

3,902

17

2564

403

509

1,50728

42

32397415

2,421

1,990

35,669

10.94

83.94

47,649

3,900

6,299107

1,545

11,851

21,7880

75

531,7201,583

25,219

34,281

387,235

12.30

81.04

45,609

7,737

24,1673

1,341

33,248

16,1060

0

4,7382,3322,422

25,598

53,259

376,882

12.10

83.69

15,460

2,195

027

1,839

4,061

4,5880

30

0743

1,920

7,281

12,240

137,516

11.24

74.90

39,231

5,468

2,757625

2,325

11,175

15,8600

963

03,2281,692

21,743

28,663

307,487

12.76

79.93

6,065

351

00

662

1,013

2,2430

0

0291622

3,156

3,922

51,017

11.89

79.74

750

0

000

0

00

0

0757

82

668

6,983

10.74

92.78

31,507

502

077

272

851

12,949638

31

0311478

14,407

17,951

226,512

13.91

73.82

*Includes all banks operating as National banks at year end, and full year data for those State banks converting to National banks during the year,flncludes the aggregate book value of debentures, preferred stock, common stock, surplus, undivided profits, and reserves. These are averages from the June and

December call dates in the year indicated and the previous December call date.^Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of the Currency.


TABLE B-32

Income and expenses of National banks, * by deposit size, year ended Dec. 31, 1970


Banks operating full year with deposits in December 1970, of-

Total $2,000.0and under

$2,000.1to $5,000.0

$5,000.1to $10,000.0

$10,000.1to $25,000.0

$25,000.1to $50,000.0

$50,000.1to $100,000.0

$100,000.1to $500,000.0

Over$500,000.0

Number of banks

Operating income:Interest and fees on loansIncome on Federal funds sold and securities

purchased under agreements to resellInterest and dividends on investments:

U.S. Treasury securitiesSecurities of other U.S. Government

agencies and corporationsObligations of States and political sub-

divisionsOther securities

Trust department incomeService charges on deposit accountsOther service charges, collection and ex-

change charges, commissions, and f ee s . . . .Other operating income


4,621 121 636 1,132 1,456 624

$13,698,354

602,927

1,654,123

326,990

1,535,30990,675626,202686,411

534,791677,949

$5,992

700

3,239

665

289101

16,791491

240258

$86,610

7,821

29,254

8,769

6,987685100

6,639

2,9141,741

$335,866

26,948

83,558

27,050

39,8812,331694

28,852

10,5565,741

$931,542

68,251

198,937

58,250

132,7055,9186,44875,964

27,70316,195

$917,722

54,506

159,849

54,695

134,3746,39217,62069,970

29,89717,901

305

$914,771

47,032

150,010

37,823

128,4175,29531,53857,506

31,52120,468

265

$2,603,967

127,548

332,526

56,465

325,87516,037126,574142,041

121,33682,225

82=

$7,901,884

270,121

696,750

83,273

766,78153,916426,437304,948

310,624533,420

20,433,731 28,766 151,520 561,477 1,521,913 1,462,926 1,424,381 3,934,594 11,348,154Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Operating expense:Salaries and wages of officers and employees. .Pensions and other employee benefitsInterest on depositsExpense of Federal funds purchased and secu-

rities sold under agreements to repurchase. .Interest on borrowed moneyInterest on capital notes and debenturesOccupancy expense of bank premises, netFurniture and equipment, depreciation, rental

costs, servicing, etcProvision for loan losses (or actual net loan

Other operating expenses.

Total operating expense. . .

Income before income taxes and securities gains or

Applicable income taxesIncome before securities gains or lossesNet securities gains or losses (after tax effect). . . .Net income before extraordinary itemsExtraordinary charges or creditsMinority interest in consolidated subsidiaries. . . .

Net income

Gash dividends declared:On common stock. .On preferred stock. .

Total cash dividends declared.

3,838,556625,174

6,215,245

937,495169,78055,165

723,788

546,553

405,5642,784,676

16,301,996

4,131,7351,239,9312,891,804

-64,5122,827,292

+2,081- 3 9

2,829,334

1,273,0394,677

1,277,716

10,5831,2532,372

072

981

476

3534,391

20,418

8,3483,9654,383-46

4,337-89

0

4,248

3,4340

3,434

35,9543,40547,845

5321816

4,960

3,762

4,21520,207

120,635

30,8858,52022,365-126

22,239-6-1

22,232

6,4420

6,442

118,16713,643190,406

640681173

18,372

14,743

16,61373,154

446,592

114,88531,68683,199+484

83,683+286-1

83,968

23,69870

23,768

292,03938,817544,903

3,6562,0611,227

53,115

41,029

36,743192,669

1,206,259

315,65486,701228,953

-380228,573+ 193-39

228,727

66,94662

67,008

281,07441,168515,890

7,0552,6822,13953,300

43,346

29,475186,015

1,162,144

300,78281,539219,243

-297218,946+ 1,177

0

220,123

68,93126

68,957

274,87841,023501,002

15,2122,6962,77353,689

44,720

26,821172,565

1,135,379

289,00277,735

211,267+2,167213,434+ 1,253

0

214,687

71,697232

71,929

787,224122,696

1,191,637

134,23221,5758,603

145,058

138,351

78,778477,068

3,105,222

829,372246,165583,207-4,759578,448

-695- 1

577,752

238,011508

238,519

2,038,637363,169

3,221,190

776,647139,86040,232

394,313

260,126

212,5661,658,607

9,105,347

2,242,807703,620

1,539,187-61,555

1,477,632- 3 8+ 3

1,477,597

793,8803,779

797,659

"Includes all banks operating as National banks at year end, and full year data for those State banks converting to National banks during the year.


TABLE B-33

Capital accounts, net income, and dividends of National banks, 1944-70


Tear (last call)

1944194519461947194819491950195119521953 .19541955195619571958..19591960196119621963.1964.. . .196519661967196819691970.

Numberof banks

5,0315,0234,0135,0114,9974,9814,9654,9464,9164,8644,7964,7004,6594,6274,5854,5424,5304,5134,5034,6154,7734,8154,7994,7584,7164,6694,621

Capital stock (par value)*

Preferred

$110,59780,67253,20232,52925,12820,97916,07912,0326,8625,5124,7974,1673,9443,7863,3323,2252,0502,0409,852

24,30427,28128,69729,12038,08157,70462,45362,572

Common

$1,440,5191,536,2121,646,6311,736,6761,779,3621,863,3731,949,8982,046,0182,171,0262,258,2342,381,4292,456,4542,558,1112,713,1452,871,7853,063,4073,257,2083,464,1263,662,6033,861,7384,135,7894,600,3905,035,6855,224,2145,503,8206,165,7576,326,508

Total

$1,551,1161,616,8841,699,8331,769,2051,804,4901,884,3521,965,9772,058,0502,177,8882,263,7462,386,2262,460,6212,562,0552,716,9312,875,1173,066,6323,259,2583,466,1663,672,4553,886,0424,163,0704,629,0875,064,8055,262,2955,561,5246,228,2106,389,080

Totalcapital

accounts*

$4,114,9724,467,6184,893,0385,293,2675,545,9935,811,0446,152,7996,506,3786,875,1347,235,8207,739,5537,924,7198,220,6208,769,8399,412,557

10,003,85210,695,53911,470,89912,289,30513,102,08514,297,83416,111,70417,971,37219,095,32420,585,40222,158,06624,080,719

Net incomebefore

dividends

$411,844490,133494,898452,983423,757474,881537,610506,695561,481573,287741,065643,149647,141729,857889,120800.311

1,046,4191,042,2011,068,8431,205,9171,213,2841,387,2281,582,5351,757,491L931.5562,534,0292,829,334

Cash dividends

Onpreferred

stock

$5,9264,1312,4271,3721,3041,100

71261540033226420317717116916599

119202

1,1261,3191,4531,3482,1244,3444,4284,677

Oncommon

stock

$139,012151,525167,702182,147192,603203,644228,792247,230258,663274,884299,841309,532329,777363,699392,822422,703450,830485,960517,546547,060591,491681,802736,591794,056892,934

1,063,6471,273,039

Ratios (percent)

Net incomebefore

dividendsto capitalaccounts

10.0110.9710.118.567.648.178.747.798.177.929.588.127.878.329.458.009.789.098.709.208.498.618.819.209.38

11.4411.75

Cash divi-dends to

net incomebefore

dividends

35.0431.7634.3840.5145.7643.1142.6949.0446.1448 0140.5048.1650.9949.8544.2052.8443.0946.6448.4445.4648.8649.2546.6345.3046.4542.1545.16

Cash divi-dends onpreferredstock to

preferredcapital

4.795.124 564.225.195 244.435.115.836 025.504.874.494.525.075.124.835.832.054.634.835.064.635.587.537.097.46

Total cashdividendsto capitalaccounts

3.533.483 483.473.503 523 733.813.773 803 883.914.014.154 184.234.224.244.214.184.154.244.114.174.364.825.31

*These are averages of data from the Reports of Condition of the previous December, and June and December of the respective years.NOTE: For earlier data, see Annual Reports of the Comptroller of the Currency, 1938, p. 115, and 1963, p. 306.


TABLE B-34

Loan losses and recoveries of National banks, 1945-70


Tear

19451946.. .1947194819491950195119521953195419551956195719581959

Total loans endof year, net

$13,948,04217,309,76721,480,45723,818,51323,928,29329,277,48032,423,77736,119,67337,944,14639,827,67843,559,72648,248,33250,502,27752,796,22459,961,989

Net losses orrecoveries ( + )

+ $7,7403,207

29,91319,34933,19914,44522,10819,32632,20125,67429,47841,00635,42838,17325,767

Ratio of netlosses or net

recoveries ( + )to loans

Percent+0.06

.02

.14

.08

.14

.05

.07

.05

.08

.06

.07

.08

.07

.07

.04

Year

19601961196219631964196519661967196819691970

Average for1945-70...

Total loans endof year, net

$63,693,66867,308,73475,548,31683,388,44695,577,392

116,833,479126,881,261136,752,887154,862,018168,004,686173,456,091

68,978,975

Net losses orrecoveries ( + )

$130,177112,41297,617

121,724125,684189,826240,880279,257257,280303,357601,734

108,518

Ratio of netlosses or net

recoveries ( + )to loans

Percent.20.17.13.15.13.16.19.20.17.18.35

.16

NOTE: For earlier data, including figures on gross losses and chargeoffs and gross recoveries, see Annual Report of the Comptrollerof the Currency, 1947, p. 100 and 1968, p. 233.

TABLE B-35

Securities losses and recoveries of National banks, 1945-70


Year

194519461947194819491950195119521953195419551956195719581959

Total securitiesend of year,

net

$55,611,60946,642,81644,009,96640,228,35344,207,75043,022,62343,043,61744,292,28544,210,23348,932,25842,857,33040,503,39240,981,70946,788,22442,652,855

Losses andchargeoffs*

$74,62774,62069,78555,36923,59526,82557,54676,524

119,12449,469

152,858238,997151,15267,455

483,526

Ratio of netlosses tosecurities

Percent0.04

.09

.10

.07

.04

.04

.12

.15

.25

.08

.32

.56

.35

.121.09

Year

19601961196219631964196519661967196819691970

Average for1945-70...

Total securitiesend of year,

net

$43,852,19449,093,53951,705,50352,601,94954,366,78157,309,89257,667,42969,656,37176,871,52870,216,98384,157,505

51,364,796

Losses andchargeoffs*

$154,37251,23647,94945,92386,50067,898

302,656149,545344,068286,215137,704

130,597

Ratio of netlosses tosecurities

Percent.30.08.08.07.15.11.52.21.44.41.16

.25

NOTE : For earlier data, including figures on gross losses and chargeoffs and gross recoveries, see Annual Report of the Comptrollerof the Currency, 1947, p. 100 and 1968, p. 234.

247


00

TABLE B-36

Assets and liabilities of National banks, date of last report of condition, 1950-70


Tear

1 9 5 0 . . . .1 9 5 1 . . . .1 9 5 2 . . . .195319541 9 5 5 . . . .19561 9 5 7 . . . .1 9 5 8 . . . .1 9 5 9 . . . .19601 9 6 1 . . . .1 9 6 2 . . . .1 9 6 3 . . . .196419651 9 6 6 . . . .1 9 6 7 . . . .1 9 6 8 . . . .19691 9 7 0 . . . .

Numberof banks

4,9654,9464,9164,8644,7964,7004,6594,6274,5854,5424,5304,5134,5054,6154,7734,8154,7994,7584,7164,6694,621

Total assets*

$97,240,093102,738,560108,132,743110,116,699116,150,569113,750,287117,701,982120,522,640128,796,966132,636,113139,260,867150,809,052160,657,006170,233,363190,112,705219,102,608235,996,034263,374,709296,593,618310,263,170337,070,049

Cash anddue from

banks

$23,813,43526,012,15826,399,40326,545,51825,721,89725,763,44027,082,49726,865,13426,864,82027,464,24528,674,50631,078,44529,683,58028,634,50034,065,85436,880,24841,689,58046,633,65850,952,69154,727,95356,040,460

Totalsecurities,

net

$43,022,62343,043,61744,292,28544,210,23348,932,25842,857,33040,503,39240,981,70946,788,22442,652,85543,852,19449,093,53951,705,50352,601,94954,366,78157,309,89257,667,42969,656,37176,871,52870,030,34284,157,465

Loans, net

$29,277,48032,423,77736,119,67337,944,14639,827,67843,559,72648,248,33250,502,27752,796,22459,961,98963,693,66867,308,73475,548,31683,388,44695,577,392

116,833,479127,453,846136,752,887154,862,018168,004,686173,455,791

Other assets

$1,126,5551,259,0081,321,3821,416,8021,668,7361,569,7911,867,7612,173,5202,347,6982,557,0243,040,4993,328,3343,719,6075,608,4686,102,6788,078,9899,185,179

10,331,79313,907,38117,500,18923,416,333

Totaldeposits

$89,529,63294,431,56199,257,776

100,947,233106,145,813104,217,989107,494,823109,436,311117,086,128119,637,677124,910,851135,510,617142,824,891150,823,412169,616,780193,859,973206,456,287231,374,420257,883,926256,426,791283,784,496

Liabilitiesfor

borrowedmoney

$76,64415,48475,92114,85111,098

107,79618,65438,32443,035

340,362110,590224,615

1,635,593395,201299,308172,087

1,015,147296,821689,087

2,283,7171,280,365

Otherliabilities

$1,304,8281,621,3971,739,8251,754,0991,889,4161,488,5731,716,3731,954,7881,999,0022,355,9573,141,0883,198,5143,446,7725,466,5725,148,4227,636,5249,975,692

11,973,85216,496,70728,284,63827,130,131

Capital

$2,001,6502,105,3452,224,8522,301,7572,485,8442,472,6242,638,1082,806,2132,951,2793,169,7423,342,8503,577,2443,757,6464,029,2434,789,9436,089,7926,299,1336,602,5197,008,4827,347,9487,680,597

Surplusundivided

profits andreserves

$4,327,3394,564,7734,884,3695,107,7595,618,3985,463,3055,834,0246,278,0046,717,5227,132,3757,755,4888,298,0628,992,1049,518,935

10,258,25211,334,23212,159,77513,127,09714,515,41615,906,24917,194,460

NOTE: For earlier data, revised for certain years and made comparable to those in this table, references should be made as follows: years 1863 to 1913, inclusive,Annual Report of the Comptroller of the Currency, 1913; figures 1914 to 1919, inclusive, report for 1936; figures 1920 to 1939, inclusive, report for 1939; and figures 1936 to1949, inclusive, report for 1966.

*After deduction of securities and loan reserves.


TABLE B-37

Foreign branches of National banks, by region and country, Dec. 31, 1970

Region and country Number Region and country Number

Central America

El SalvadorGuatemalaHondurasMexicoNicaraguaPanama

South America

ArgentinaBoliviaBrazilChileColombiaEcuadorGuyanaParaguayPeruUruguayVenezuela

West Indies (Caribbean)

AntiguaBahamasBarbadosCubaDominican RepublicFrench West IndiesGrenadaJamaicaNetherlands AntillesTrinidad and TobagoBritish Virgin IslandsWest Indies Federation of States

Europe

AustriaBelgiumEnglandFranceGermanyGreeceIrelandItalyLuxembourgNetherlandsNorthern IrelandSwitzerland

44

13353

29

139

385

18172612

16844

89

249

30

121262633

90

18

239

189341716

Africa

Liberia

Middle East

BahrainIsraelLebanonQatarSaudi ArabiaTrucial States

Asia and Pacific

Fiji IslandsHong KongIndiaIndonesiaJapanKoreaMalaysiaOkinawaPakistanPhilippinesRepublic of ChinaSingaporeThailandVietnam

U.S. overseas areas and trust territories

Panama (Canal Zone)Caroline IslandsGuamMarianas IslandsMarshall IslandsPuerto RicoVirgin Islands

Total

Military banking facilities

2

2

12

78

113116123524421122

43

213111916

497

31

249


TABLE B-38

Total assets of foreign branches * of National banks, year-end 1953—70

[Dollar amounts in thousands]1953 $1,682,919

1,556,3261,116,0031,301,8831,342,6161,405,0201,543,9851,628,510

1961 1,780,926

1954.1955.1956.1957.1958.1959.1960.

1962 $2,008,4781963 2,678,7171964 3,319,8791965 7,241,0681966 9,364,2781967 11,856,3161968 16,021,6171969 28,217,1391970 38,877,627

*Includes military facilities operated abroad by National banks in 1966 and thereafter.

TABLE B-39

Foreign branches of National banks, 1960-70

End of year

19601961196219631964

Number of branchesoperated by

National banks

93102111124138

National bankbranches as a per-

centage of totalforeign branches of

U.S. banks

75.075.676.677.576.7

End of year

1965 . .1966 . . .1967196819691970

Number of branchesoperated by

National banks

196230278355428497

National bankbranches as a per-

centage of totalforeign branches of

U.S. banks

93.594.395.595.093.092.7

TABLE

Assets and liabilities of foreign branches* of National banks, Dec. 31, 1970: consolidated statement

[Dollar amounts in thousands]Gash and cash items 266,931Due from banks (time and demand) 8,852,471Securities 565,116Loans, discounts and overdrafts 15,057,401Customers' liability on acceptances 1,217,900Fixed assets 126,228Other assets 531,526Due from head office and branches (gross) 12,260,054

Total 38,877,627

Total demand depositsTotal time depositsU.S. Government depositsCertified checks, officers' checks, official checks.

3,448,28024,765,018

236,16699,813

Total deposits 28,549,277

Other liabilities and borrowed funds 890,927Liabilities on acceptances 1,221,091Due to head office and branches (gross, including

capital) 8,216,332

Total 38,877,627

"Includes military facilities.

250


TABLE B-41

Trust assets * and income of National banks, by States, calendar 1970[Dollar amounts in millions]

Numberof banks

Employeebenefit

accounts^

Othertrust

accounts%

Totaltrust

accountsAgency

accounts §

Total,trust and

agencyaccounts

Trustdepartment

income{Dollar amounts

in thousands)

United States

AlabamaAlaskaArizonaArkansasCaliforniaColoradoConnecticutDelawareDistrict of Columbia ||

FloridaGeorgiaHawaiiIdahoIllinoisIndianaIowaKansasKentuckyLouisianaMaine



South CarolinaSouth DakotaTennesseeTexasUtahVermontVirginiaWashingtonWest VirginiaWisconsinWyoming

1,696 45,254 74,441 119,695 30,609 150,305 629,817

3042

3116291116

862702

162964648532016

1155382119351219319

761878161160402

1313

810321392104710333814

240275429

4,5922963160

312

307382026

6,36540082534315329

1231,5883,938895466795

1476

28618

13,22685716

1,570198229

4,609224

12823170

1,710753

197314202364

79515

530212

7,7781,1181,490

01,137

2,9711,120

057

6,0112,196432418311237230

5822,3272,5051,685185

2,29645493268131

1,625213

8,1881,676

833,890770658

8,6151,116

37985

1,1803,84716243

1,2011,321304

1,45851

1,03542584241

12,3701,4141,806

01,449

3,2781,502

083

12,3762,596514471354390259

7053,9156,4432,580231

2,97550640274139

1,911231

21,4142,533

995,460968887

13,2241,340

507108

1,3505,55723746

1,3981,635324

1,69455

144313817

1,5723057910

989

4581,217

040

3,8577872461171508385

213992

1,2627448

1,005131722469

67634

6,10253315

98831398

2,820373

9235553

1,1511612

6982513036824

1,17974622258

13,9421,7192,596

02,438

3,7372,719

0123

16,2333,384760588503474344

9194,9067,7053,324239

3,98163812298208

2,587265

27,5163,066115

6,4481,281984

16,0451,713

599143

1,9036,70825358

2,0951,886355

2,06279

5,238232

4,3881,279

76,87211,27010,768

08,963

17,06310,066

0500

62,79112,2943,3462,7912,1532,5781,679

3,66339,24020,60014,3251,36513,256

3464,2711,529806

15,8851,250

106,73511,277

66821,3345,4525,651

47,8047,413

2,276775

7,35833,136

1,159363

9,18210,2521,7116,139

314

*As of December 31, 1970.fEmployee benefit accounts include all accounts for which the bank acts as trustee, regardless of whether investments are

partially, or wholly, directed by others. Insured plans or portions of plans funded by insurance are omitted, as are employee bene-fit accounts held as agent.

{Includes all accounts, except employee benefit accounts and corporate accounts, for which the bank acts in the following, orsimilar capacities: Trustee (regardless of whether investments are directed by others), executor, administrator, guardian; omits allagency accounts and accounts for which the bank acts as registrar of stock and bonds, assignee, receiver, safekeeping agent, cus-todian, escrow agent, or similar capacities.

§Includes both managing agency and advisory agency accounts.| [Includes National and non-National banks in the District of Columbia, all of which are supervised by the Comptroller of

the Currency.NOTE: Data may not add to totals because of rounding.

251


APPENDIX G

Addresses and Selected Congressional Testimony ofthe Comptroller of the Currency


Addresses and Selected Congressional Testimony

Date and Topic Page

May 15, 1970, Statement of William B. Camp, Comptroller of the Currency, before the Senate Banking and Cur-rency Committee, on One-bank Holding Company Legislation 255

Oct. 12 1970, Remarks of William B. Camp, Comptroller of the Currency, before the National Bank Division of theAmerican Bankers Association, Miami Beach, Fla 257

Mar. 18, 1970, Remarks of David C. Motter, Deputy Comptroller of the Currency (Economics), before the Mont-gomery County Bankers Association, Montgomery County, Md 261

July 22, 1970, Remarks of Dean E. Miller, Deputy Comptroller for Trusts, before the American Bankers AssociationFiduciary Responsibility Seminar, Washington, D.C 264

Nov. 19, 1970, Remarks of Dean E. Miller, Deputy Comptroller for Trusts, before the Mid Continent Trust Confer-ence of the American Bankers Association, Chicago, 111 267

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STATEMENT BY WILLIAM B. CAMP, COMPTROLLER OF THE CURRENCY,BEFORE THE SENATE BANKING AND CURRENCY COMMITTEE,

ON ONE-BANK HOLDING COMPANY LEGISLATION, MAY 15, 1970

I would like to discuss with you this morningtwo topics relating to the bills under study bythis Committee: first, the so-called "laundry list"approach, which is of crucial importance to thebanking industry and, I believe, to the wholeeconomy; second, the allocation of agency respon-sibility under the legislation passed, a matter ofconsiderable importance for our Office.

H.R. 6778 includes a "laundry list" of activitieswhich would be prohibited for subsidiaries ofholding companies controlling one or more banks.We must note, however, that although this bill,and the other bills before this Committee on thesame topic, purport to relate only to bank hold-ing companies, their supporters are really attempt-ing to define and delineate the business of bank-ing. It was stated on the floor of the House thata broadly-based organizational form with a varietyof subsidiaries, including a bank, would not bebarred from a particular line of endeavor if abank itself could carry out this same activity.

The fact that we are dealing with the delinea-tion of the allowable activities for the bankingindustry is, in my view, very crucial as we searchfor that governmental policy which will be mostconsistent with the public interest. It is unfor-tunate, I believe, that the public discussion ofH.R. 6778, and the other bills before this Com-mittee, has been almost entirely in terms of hold-ing companies and their activities, rather thanin terms of banks and their activities. In the publicmind, holding companies tend to be thought ofas something far removed from day-to-day experi-ence and, often perhaps, as a phenomenon asso-ciated with financial manipulation and financiallegerdemain. On the other hand, virtually everyonehas had considerable day-to-day contact withbanks.

It may be useful for us to examine briefly therecent history of banking leading up to the forma-tion of a number of bank-centered one-bank hold-ing companies. Our Office, during the decade of the

1960's, was in the forefront in the examination andre-examination of existing banking regulations in apainstaking effort to determine whether each regu-lation was still serving a useful purpose. Manyregulations were carryovers from the financially-troubled era of the early 1930's. Many financialmarkets today are so different from their counter-parts of that time, that the connection betweenthem is little more than historical. The degree ofsophistication required to meet many of the finan-cial needs of our complex and dynamic economy isso great that the institutions and markets as con-stituted in the thirties could simply not performadequately today. Yet, the framework of regulationcreated at that time was, in general, still beingapplied at the beginning of this decade.

Our process of examining the current validity ofbanking regulations, therefore, exposed a numberof cases in which regulations not required by cur-rent statute could be eliminated, and others couldbe modified, within the statutory framework. As aresult, over time, National banks were able tooperate in a regulatory climate which provided agreater, and healthier, degree of discretion to bankmanagement.

In part due to the elimination of regulatory re-strictions just described, and in part due to theadvent of a more innovative spirit within bankmanagement itself, banks began to expand theiroffering of certain financial services, and began tooffer some new ones. The public was the immediatebeneficiary because the expansion of bank activityprovided the benefits of additional competition.However, when competition increases there can beno guarantee that individual competitors will notbe subjected to greater pressures. In fact, in com-petitive markets it is generally understood that thepublic benefits of competition do not come pain-lessly, from the standpoint of the competitors.

One result, and a quite proper one under oursystem, was the filing of lawsuits by firms in a num-ber of functional areas. Each felt itself damaged by

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the added competition generated by commercialbanks. It is interesting to note the arguments ad-vanced by the plaintiffs in these suits. Rarely, if atall, was it claimed that the public interest was beingharmed by the provision of the particular servicesby commercial banks. Rather, the suits rested onthe quite narrow issue of whether National banks,under their charters, had the right to provide theservices in question.

It is important to emphasize that there have beenno complaints about those bank activities by thegeneral public, or by the consumers, at any level,of the services in question. On the other hand, itis difficult to conceive of a more anticompetitivethrust than that contained in, as an example, thesuit brought by the association of data processingcompanies. Very simply, that association chargedthat banks simply had no right to provide dataprocessing services to their customers, despite thefact that banking is essentially a data processingactivity, whether that processing is done by a gentle-man with a green eye shade, sitting on a high stool,or by the latest computer system. It was natural forbanking, given its need for a variety of voluminousrecord-keeping operations, to become heavily in-volved in data processing as we know it today, aidedby the most sophisticated computer systems whichman has been able to devise.

What has all this to do with the immediate issuebefore the Committee? Commercial banks, tiring ofcontinual harrassment from litigation brought by avariety of non-bank competitors, attempted to de-vise an organizational form which might have im-munity from such suits. The device of creating aparent holding company, under whose corporateumbrella a number of the bank operations could bespun-off as holding company subsidiaries, seemed toprovide a possible answer. In the period from mid-1968 through April 30, 1970, 75 National bankstook the steps necessary to reorganize their corpor-ate structure in the form of a so-called one-bankholding company.

When we examine the subsidiaries of these hold-ing companies, we find that the vast majority ofthem were capitalized by the parent as new enter-prises, or as corporations to absorb operations spun-off from the bank. Acquisitions of existing enter-prises are much fewer in number, and have typic-ally involved relatively small firms. As you know,this Office, in approving the steps necessary tocreate a parent holding company, applies a provisowhich requires approval by this Office for any addi-

tional subsidiaries of the holding company, whetheracquired, or newly established. We have restrictedsuch subsidiary operations to the financial sector,and to activities that we considered properly relatedto the functioning of a bank-centered financialorganization.

I offer this brief history of some of the relevantevents leading up to the one-bank holding com-pany controversy in the hope that it may allow asomewhat better understanding of the essential is-sues. I repeat that we should not forget that thelegislation under discussion involves an attempt todefine and delineate the activities which bankingorganizations will be allowed to perform. It is con-ceivable that a more constructive public discussionwould have occurred had the issue been put in thatfashion, rather than being related constantly to aholding company superstructure.

If this Committee, and later, the Senate, decidesto place one-bank holding companies under thesame regulation as multi-bank holding companies,it is my earnest hope that the legislation will not in-clude a so-called "laundry list" of prohibited activi-ties, like that contained in H.R. 6778. For thatmatter, a positive "laundry list" would be almost asunhealthy. Imagine the listing of "proper" bank-ing activities which might have been drawn up in1950, or even in 1960. The list that any knowledge-able observer would draw today would differ con-siderably from a comparable list of a decade ago.That is simply to say that in a dynamic, growing,complex economy such as ours, financial institu-tions, including commercial banks, must be free torespond to financial needs as they occur. Thoseneeds can not be predicted very far in advance, andthey change materially over periods of time. Toplace commercial banking in a statutory straightjacket would be, in my view, an action decidedlyagainst the public interest.

Insofar as existing statutes have allowed it, ourOffice has permitted banks to engage in any finan-cial activity which will not endanger the liquidityor solvency of the bank in question, or the bankingsystem, and which appears to be consistent with thepublic interest, taking proper account of the com-petitive impact. Our preference would be for astatutory test along those lines, to determine theactivities in which banks and bank holding com-panies may engage.

Before leaving the topic of the definition of thebanking business, I would like to read from myletter in the 1969 record of the House hearings. I


believe the letter is consistent with the views whichI have just stated, and it further provides some rele-vant quotations from various court decisions.

This quotation deals with an interpretation ofthe meaning of the "incidental powers" provisionfound in the New York Free Banking Act of 1837.This provision was very similar to the incidentalpowers clause of the National Bank Act, 12 U.S.C.24 (7). In construing this section of the New YorkAct in 1857, the New York Court of Appeals held,in Curtis v. Leavitt, 15 N. Y. 9, that the impliedpowers of a bank

are not enumerated and defined; because nohuman sagacity can foresee what implied powersmay, in the progress of time, the discovery andperfection of better methods of business, and theever varying attitude of human relations, be re-quired to give effect to the expressed powers.They are therefore left to implication.

Now, may I briefly turn to a topic which fallsunder the general category of administrative house-keeping. Under any one of the bills before theCommittee, responsibility for administering theterms of the legislation will be given to one or moreagencies. As Administrator of National Banks, myOffice has more than a passing interest in this de-cision. As long as the tripartite division of Federalregulatory powers over banking continues, my pref-erence would be that the respective Federal agenciesbe made responsible for regulating those holdingcompanies controlling their respective banks. Thatis, our Office would be responsible for regulatingthose one-bank holding companies having Nationalbanks as subsidiaries, the Federal Reserve wouldregulate those having State member banks as sub-sidiaries, and the Federal Deposit Insurance Corpo-ration would be responsible for those companieshaving State non-member banks as subsidiaries.This would not require any change from the exist-ing allocation of responsibility for regulation ofmulti-bank holding companies to the FederalReserve.

Let me point out that there is a very meaningfuldistinction between the appropriate regulation of amulti-bank holding company and a one-bank hold-ing company. We have had no problems in con-tinuing to supervise the National banks in a multi-bank holding company system although the FederalReserve has had regulatory powers over the parentcompany. For example, a particular system might

include 10 National banks, 5 State member banks,and 5 State non-member banks. Each of the threeFederal agencies would exert its appropriate regula-tory and supervisory authority over the subsidiarybanks. However, in the case of bank-centered one-bank holding companies, the bank subsidiaries areby far the most important subsidiary of the parentcompany. In one case, for example, the subsidiarybank has $22.8 billion in assets, while the parentholding company has $23.1 billion, only about 1percent more. It is abundantly clear that to placethe parent holding company in this situation underthe Federal Reserve, and to keep the subsidiarybank under our supervision, would effect a sub-stantial shift in regulatory powers. Further, weshould not ignore the substantial degree of regula-tory duplication and overlap that would be created.

The President's Commission on Financial In-stitutions should, and undoubtedly will, explorefully the structure of bank regulation, and un-doubtedly will make appropriate recommendations.It would appear that, with the Commission nowbeing constituted, major restructuring of bankregulation should await the findings of the Com-mission. As I have indicated, the placement of theregulatory powers in question in the hands of anyone agency would result in a substantial shift inbank regulatory structure. Therefore, I am hope-ful that the Congressional verdict will be to retainthe tripartite responsibility for the time being.

REMARKS OF WILLIAM B. CAMP,

COMPTROLLER OF THE CURRENCY,BEFORE THE NATIONAL BANK DIVISION OF THE

AMERICAN BANKERS ASSOCIATIONMIAMI BEACH FLA., OCT. 12, 1970

It is a real pleasure, indeed, a signal honor, toagain be invited to address the National BankDivision of the American Bankers Association atthis convention.

As some of you may know, I was a NationalBank Examiner for more than 20 years, and whileI have been received by different people in differentways in different sets of circumstances, I canhonestly say that some of the happiest days of mylife have been spent while directly engaged in thebank examination process. Some people, however,do not hold examiners in the highest esteem. Forexample, Elbert Hubbard wrote:

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The typical bank examiner is a man past mid-dle age, spare, wrinkled, intelligent, cold, passive,non-committal, with eyes like a codfish, polite incontact, but at the same time unresponsive, cold,calm and damnably composed as a concrete postor a plaster of paris cast; a human petrificationwith a heart of feldspar and without charm ofa friendly germ, minus bowels, passion or a senseof humor.Happily, they never reproduce and all of themfinally go to Hell.

I should also point out that the Comptroller isoften subject to criticism. Many years ago MarkTwain wrote:

Nothing in this world is palled in such impene-trable obscurity as a U.S. Treasury Comptroller'sunderstanding. The very fires of the hereaftercould get up nothing more than a fitful glimmerin it.

As I have indicated, bank examiners are not al-ways the most popular visitors wherever they go.Bank regulatory authorities, themselves, are beingexamined disapprovingly in some quarters. Banksand bankers are being criticized from all sides,often for things they don't do as much as for thingsthey do.

Not long ago, a senior Congressman, whom Ishall not name, although I am sure you all knowwho he is because he is the one who picks on youthe most, must have had a slow day. The onlycriticism of the banking industry he could find thatday was that bank-controlled small business invest-ment corporations had received too many SmallBusiness Administration loans last year. Theamount that he considered disproportionate wasabout two-sevenths of the $70,000,000 loaned by theagency last year. Mr. Hilary Sandoval, the Admin-istrator of the Small Business Administration, wheninformed of the Congressman's criticism, made aremark with which I don't think anyone could dis-agree. Mr. Sandoval said: "Banks, whether anyonelikes them or not, I imagine are here to stay, forthey are part of America." The Journal of Com-merce, in an editorial, said that Mr. Sandoval'sreply indicated that Mr. Sandoval "knows on whatburner one should cook the goulash/'

I am here today to underscore Mr. Sandoval'sbelief that banks are here to stay, and I, for one,am glad of it. The fact remains that this industry,notwithstanding all the competitive, political, legal,and, lately, even physical attacks to which it has

been subjected, has performed and is continuing toperform outstanding service to our great Nation,and, indeed to the world at large. Bank participa-tion in the Small Business Administration program,far from calling for criticism, is one of the moreobvious aspects of that contribution.

It is extremely difficult for me to understandhow those who proclaim themselves as staunchdefenders of the people against vested interests canso vigorously oppose any effort by banks to competewith other financial institutions in order to im-prove public services, reduce costs to customers, andachieve greater efficiencies in their operations.

Other critics, with different points of view, con-tend that the banks are not doing enough, particu-larly in the broad field of social reform. Thesecritics want to see banks compelled to make prefer-ential loans to particular classes of borrowers, re-gardless of the collateral pledged or the businessjudgment of the debtor. Some of them want to seebanks loans channeled to one industry in prefer-ence to others. Some want bank credit concentratedbehind activities they deem most important, with-out attaching much significance to a balance ofpriorities among contending applicants. Still otherscontend that banks should be restrained from lend-ing to certain industries because of objections tothe products they manufacture.

The most radical and revolutionary critics ofbanking are not content with merely making de-mands; they seem to be unwilling or unable topress their demands with reasoned arguments, orto justify them with persuasive facts. They prefer,instead, to register their discontent with bombs orbombing threats, with arson of bank buildings, orwith destruction of bank records and facilities byangry mobs.

A speech was made on the floor of the Senatesome time ago by a member who was dismayed atthe turn of events he had seen. He declared:

. . . There are persons who constantly clamor.They complain of oppression, speculation, andpernicious influence of wealth. They cry outloudly against all banks and corporations, anda means by which small capitalists become unitedin order to produce important and beneficial re-sults. They carry on mad hostility against allestablished institutions. They would choke thefountain of industry and dry all streams . . . .

The speech went on at some length, but whatI have quoted is enough to show the general nature

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of the remarks of Senator Daniel Webster to hiscolleagues on March 12, 1838.

Even today's less violent bank critics, I suspect,seldom stop to think that whatever the banks aredoing, they're doing with other people's money;the loans that banks make and the risks that theyassume are accomplished with the savings entrustedto their care, accepted with the promise that in-terest and dividends will be earned and paid totheir depositors and shareholders. I often wonderif some of the more liberal critics of banking wouldbe willing to invest their own savings in all theways they urge the banks to invest the savings ofothers.

Fortunately, good bankers are level-headedenough not to panic under attack. They knowfrom long experience, in times less troublesomethan these, that a lender is usually regarded as abenefactor when a needed loan is made and alltoo often is considered an ogre when the loancomes due.

Good bankers have a sense of self-discipline thatis strong enough to help them make firm distinc-tions between the desirable and the possible. Atthe same time, they have a deep concern for thewell-being of their customers and their communi-ties which leads them to make sound loans for anygood purpose. Good bankers are alert to opportuni-ties to expand and improve their financial servicesin order to meet any of their customers' valid de-mands that do not threaten the solvency and liquid-ity of the bank, itself.

There is certainly a strong element of self-inter-est in this approach to banking, for the wise bankerknows that his institution can prosper only throughthe sound growth of the community he serves. Inturn, as is true in any service industry, he knowsthat his bank can attract customers and depositorsonly when it earns their confidence and suppliestheir worthwhile needs.

Banking has been alert to find new ways to meetthose needs. Under the encouragement of morefar-sighted regulatory policies, the banking industryhas, in recent years, responded enthusiastically tothe abundant prospects for broadened service.Banks have sought to enlarge their resources byintroducing or expanding the use of certificates ofdeposit, capital debentures, preferred stock, andpromissory notes—and thus, they have completedmore actively and more effectively for savings intheir communities. They have begun to apply thenew technology to their own operations, although,

as always in such periods of transition, there havebeen problems of adaptation and questions of thesuitability of techniques. To carry out these grow-ing endeavors, banks have been strengthening theirstaffs through the recruitment of greater numbersof highly trained and able young men and women.

This new vitality has found expression in themore active pursuit of new markets and functions.Consumer loan and mortgage markets, long ne-glected, have become the focus of increased atten-tion. Credit cards, check guarantees, and overdraftfacilities have made banking facilities more con-venient for a broader range of consumers. Growingexpenditures for travel have elicited expandedtraveler's check and related services; and the expertinvestment-management capabilities of banks havebeen brought within the reach of many of the grow-ing number of small investors.

Industrial and commercial enterprises have alsofound banks more responsive to their needs. Leas-ing and factoring activities have grown more com-mon. Foreign trade financing has attracted theefforts of larger numbers of banks. The computeri-zation of operations has enabled banks to offerexcess capacity to others, and to expand their per-formance of payroll and accounting functions forcustomers. Larger staffs of expert personnel havepermitted banks to broaden their advisory services,both to business and individuals. And, through theunderwriting of revenue bonds and communitydevelopment loans, their aid to local governmentshas been enlarged.

There are many additional illustrations of thenew functions that banks have been undertaking,and the list will grow larger still. Some competinggroups have complained to Congress and to thecourts that the list is already too large, and thatbanks should be stopped, by law, from expandingtheir functions. As a result of research for a Con-gressional inquiry, I was quite fascinated to findthat, in 1870, there was a law suit in which onebank challenged another on the legality of bankcertification of checks. The suit was before theUnited States Supreme Court. In the case the Courtwas asked to define what the proper powers of abank should be. The Court said, in part:

The practice of certifying checks has grown outof the business needs of the country. Customshave sprung from the necessities and the con-venience of business and prevailed in durationand extent until they acquired the force of law.This mass of our jurisprudence has thus grown,

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and will continue to grow, by successive accre-tions.

In a decision of the New York Court of Appeals,in 1857, the court was asked to define the impliedpowers clause of the New York Free Banking Act.The New York Court of Appeals, in languagewhich I consider more classical than the SupremeCourt language of one hundred years ago, stated:

The implied powers of a bank are not enu-merated and defined; because no human sagacitycan foresee what implied powers may, in theprogress of time, the discovery and perfection ofbetter methods of business, and the ever varyingattitude of human relations, be required to giveeffect to the expressed powers. They are there-fore left to implication.

I think these two court decisions are the bestanswers that I have ever seen to the suggestionsthat the list of activties in which banks are pres-ently engaged is already too large.

Today, in our cities, in our universities, in oureconomic affairs—both domestic and international—we face mounting challenges to our cherishedprinciples of personal freedom and individual ini-tiative. The viability of these principles rests uponour capacity to demonstrate that they can be madeto work in serving today's needs as well as those ofthe future.

I am not one to despair at the • rospect of solvingthe huge problems which seem to be closing in onus today. One would have to be foolish indeed tominimize the problems of ecology, race, inflation,violence, crime, the generation gap, and the restof the seemingly endless list of horrors presented tous every day in our morning newspaper. I donot despair of our being able to successfully meetand resolve those problems for the simple reasonthat we have already overcome many problemswhich at the time seemed just as formidable.

When we look back over the last five decades,1919 to 1969, we find that our life expectancy hasbeen increased by approximately 50 percent. Wefind the working day decreased by a third at thesame time that per capita output more than dou-bled.

We find a people who no longer have to fear theepidemics of flu, typhus, diphtheria, smallpox,scarlet fever, measles, or mumps that they knew intheir childhood. Once dreaded TB is almost un-heard of and, just in the last 10 years, the greatmaimer, polio, has been conquered.

We find a generation that, having lived throughhistory's greatest depression, determined that itwould not happen to its children and that, accord-ing to virtually all of our most learned economists,has succeeded in that determination.

We find a new generation of children who, de-spite the apparent efforts of some of them to hideit, are the tallest, healthiest, brightest, and probablybest-looking generation to inhabit the land. Thesechildren will work fewer hours, learn more, havemore leisure time, travel to more distant places,and have more of a chance to follow their life'sambition than any generation ever has.

I do not doubt that a nation that has done allthose things, in such a short period of time, canaccomplish the great tasks remaining undone, find-ing alternatives for war, for racial hatred, for pollu-tion of the environment, and for inflation.

The banking industry stands at the center ofthese crucial struggles. It is in a unique position toexercise leadership for its spirit and its attitudescolor the outlook, the sentiment, and the posture ofmen and women of enterprise throughout thecountry. An energetic, far-seeing, and responsivebanking system can do much to assure that ourgreat wealth of resources and the unbounded capa-bilities of our people are put to work fully andeffectively in the realization of our national aims.

I believe, therefore, that we must continue towork for the full realization of the great potentialof the banking industry. Our aim should be tofashion and sustain a banking system that respondsswiftly to new demands and opportunities, thatalertly applies new techniques to enhance pro-ficiency of operations, and that persistently searchesfor new functions that can be performed safely andprudently. In the process, I believe that growth insize of units, through effective combination of com-plementary functions, is a necessary corollary togrowth in service capacity.

These goals are fully consonant with the besttraditions of our private free enterprise system.Nothing less will allow our banking system to ful-fill its essential role in the Nation's future. Re-markable as our past has been, I am confident thatwe are entering a new era of achievement in bank-ing service that will far outdistance any other ac-complishment we have known.

The ferment we find today in the field of bank-ing is the outcome of a re-birth of enterprise in anindustry long accustomed to protection against

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this vital force in our economy. Some portray thesedevelopments as a growth of governmental power,but, in truth, they reflect a relaxation of govern-mental power over the exercise of initiative byprivately-owned enterprises.

Our commercial banks lie at the heart of ourfinancial system, and the capability of our financialsystem critically affects the progress of our entireeconomy. A banking system alert to its positive re-sponsibilities, and equipped to carry out those re-sponsibilities, is thus indispensable to the success ofour private enterprise system. This objective canbe achieved only by allowing the forces of individ-ual initiative to be expressed more fully and moreactively in this industry.

The present advanced level of our economic de-velopment was not achieved by preserving the statusquo. Those of you who have lived and worked inthe world of industry and commerce are intimatelyaware of the vitality that private initiative impartsto our economy. Our past achievements, underthe influence of that initiative, are well known tous all. Ahead lie vistas which none of us today canfully realize. The strength of our productive power,the skills of our new generation of young men andwomen, the rate of our technological progress areall at levels unmatched in our past experience. Westand poised for new achievements beyond ourimagination. It will not take another 75 years toattain the advances we have achieved in the past 75.

To meet the needs of our great Nation, indeed,the needs of the world at large, we will require abanking system free to employ its innovative capa-bilities, its ingenuity, and its vast skills most effi-ciently in furthering the progress of the world.Working together, I am certain that we can reachthis compelling objective so acutely important toour Nation's future.

In closing, I wish to assure you that our Officewill continue to be responsive to the efforts of ourbanks to serve the ever-growing needs of their cus-tomers, their communities, and our Nation as awhole.

REMARKS OF DAVID C. MOTTER,

DEPUTY COMPTROLLER OF THE CURRENCY

(ECONOMICS) , BEFORE THE

MONTGOMERY COUNTY BANKERS ASSOCIATION

MONTGOMERY COUNTY, MD., MAR. 18, 1970

I would like to bring you some thoughts tonightconcerning two not unrelated topics: first, the

proper role of banking in our complex, dynamiceconomy and, second, the shorter-run problemsposed for banking by its involuntary, but inescap-able, role in the transmission of monetary policy'simpact to the economy.

The "proper" role for banking, the delineation ofbanking's product and service mix, remains, after adecade of discussion and controversy, the mostcrucial question for the future of the industry. Con-flicting forces have been contending for their pointsof view before courts, Congress, and various govern-mental agencies, including the banking agencies.Among the banking agencies themselves, consider-able differences in points of view have existed atvarious times.

In our Office we are proud that the policies andrulings of the Comptroller of the Currency have,we believe, fostered and encouraged an innovativespirit and attitude in the banking industry. It isclear that banking in 1970 is significantly differentfrom banking in 1960. In fact, the differences aresufficiently great that one may make a case for theview that they do not represent differences in de-gree but rather differences in kind.

I will not take time to indicate the long line ofactions by the Comptroller of the Currency whichprovided significant support to bank innovationduring the 1960's. Let it suffice to note only a fewof those actions. The image of a closed structurefor the National Banking System was dispelled. Sig-nificant increases in the number of banking officesavailable to provide for the banking needs of thepublic occurred. We think that the combinationof branching, charter, and merger policies of theComptroller during the past 10 years, has had aprofoundly favorable effect upon the ability of Na-tional banks to meet the diverse and complex finan-cial needs of our economy.

One area of great expansion for U.S. banking hasbeen that of international banking. From a total of85 offices operated abroad by National banks in1960, the figure reached 428 at the end of 1969, anincrease of 369 percent. Of all offices operatedabroad by U.S. commercial banks at the end of1968, 95 percent were operated by National banks,and the percentage was similar a year later. Totalassets of foreign branches of National banks spurtedtenfold, from $1.6 billion, in 1960, to $16.0 billion,by the end of 1968. Our Office holds the view thatexpansion into foreign markets by those Nationalbanks with sufficient resources and expertise to al-low them to perform properly is in the best interest


of the banks themselves, of the United States, andof the foreign countries concerned.

The offering of certain services by commercialbanks has been initiated, and the offering of othershas grown considerably in importance. Those serv-ices include direct lease financing, the sale of dataprocesssing services to bank customers, travel serv-ices, the offering of credit-related insurance serv-ices, the underwriting of securities issued by variousgovernmental entities, and the provision of addi-tional trust-related activities.

You will note that National banks and the Comp-troller of the Currency have been involved in liti-gation in connection with most of the above-namedservices. It is, of course, of prime relevance to askwho has instigated those suits. In no instance haveconsumers, or groups of consumers, of the servicesbrought court action. Quite the contrary. By andlarge the consumers of those and other expandedbanking services have benefited from the additionalcompetition which resulted from the enlarged roleof commercial banks in those various markets.

The suits in question have, without exception,been brought by competitors of commercial banks,competitors who opposed the additional competi-tive pressures imposed upon them by bank activity.It is interesting to read the briefs filed by litigantsin such cases. It is rare to find, even in a plaintiff'sbrief, a charge that the broad public interest hasbeen harmed by the banks' provision of the servicesin question. Commonly, the litigants have restedtheir cases primarily on the view that Nationalbanks do not have the power to offer such services.We should note that the ruling on March 2 bythe Supreme Court virtually confers "standing" toany group of bank competitors desiring to block, bycourt action, the performance of specific activitiesby commercial banks. This means that, in the casesin question, courts will hold at the outset that theplaintiffs have the right to sue commercial banks forengaging in particular activities. Then, of course,the court inquiry will be directed to the merits ofthe issue. We have to hope that, in this explorationof the merits, the prime question will be the ul-timate effect on the public interest.

The question of the appropriate regulation ofone-bank holding companies is tied very closely tothe question of the proper activities of banks andbank affiliates. The litigation mentioned abovewas certainly a major factor in leading many bankofficials to consider favorably the establishment ofparent one-bank holding companies. It was thought

by some observers that the creation of a parentholding company would allow certain activities tobe carried on by a banking organization withoutthe threat of harassment in the form of litigationbrought by bank competitors. I am sure that youare all aware of the House of Representatives' con-sideration of the one-bank holding company issuein 1969, and the provisions of the bill finally passedby that body.

It should be noted that in the discussions in theHouse and the forthcoming deliberations in theSenate on the one-bank holding company billvitally affect all commercial banks, not just thosethat have formed, or are contemplating the forma-tion of, a parent holding company. That is becauseit is quite clear that if legislation prohibits a broadholding company organization from engaging in aparticular activity, that activity will almost cer-tainly be barred for an individual bank. Therefore,any prohibitions that find their way into the finalact passed by Congress in that area will effectivelyapply to all commercial banks.

The Administration has taken a well-reasonedposition on the one-bank holding company issue.There is proper concern that the boundary linesbetween banking and industry remain unblurred.In point of fact, of course, the efforts to blur thisline have not come from the banking side, but havecome from takeovers, or attempts to takeover, banksby non-financial corporations. The Administrationproposals and the bill that was passed by the HouseBanking Committee avoided the creation of specific"laundry lists", that is, lists of activities that wouldbe prohibited for commercial banks and theiraffiliates.

The wisdom of that stance is obvious if we thinkof the recent history of our financial institutionsand markets. Imagine a "laundry list" of pro-hibited activities that might have been drawn up in1960. Or even more dramatic, imagine the list ofacceptable activities for banking that might havebeen drafted at the same time. A number of im-portant current banking activities would almost cer-tainly not have appeared on the latter list.

The lesson is obvious. The financial needs of oureconomy are so complex, and the demands uponour banking system are so dynamic in their nature,that one cannot possibly foresee the evolution ofbanking services and products over time. Yet, underthe "laundry list" approach, if specific activities arebarred for commercial banks and their affiliates atthis time, one can well imagine the difficulty of

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securing a statutory change, reversing such a pro-hibition, in the face of strong opposition by affectedcompetitors of banks.

The bill that the House Banking Committee ap-proved was altered so drastically on the floor of theHouse that it bears little resemblance to the Com-mittee product. The "laundry list" approach wasincorporated in the House-passed bill. The SenateBanking Committee has not yet set a date for hear-ings on this legislation.

One possible benefit for the banking industry inthe widespread discussion of one-bank holding com-panies is that the attention of a number of veryable people has been, and will be, directed to thequestion of the proper role of the banking system.You, perhaps, have read the article, by ProfessorHenry Wallich, entitled "Banks Need More Free-dom to Compete", that appeared in the March 1970issue of Fortune Magazine. If you have not read it,I believe you will find it to be a stimulating article.I say this without meaning to imply that I neces-sarily endorse the positions taken in the article.

Professor Wallich's major point is that if statutesand regulations consistently impede the perform-ance of new functions by banks the outcome maywell be to place the banking system "in danger ofgoing the way of the railroads". He recommends avery considerable increase in the flexibility of thescope of banking operations. In fact, the path heenvisions could well lead to a financial system quitedifferent from that which we currently have. Un-doubtedly the most controversial of Wallich'sviews, from the standpoint of the banking industry,is his position that banks can defend the right offlexibility in their own product and service mixonly if the barriers to provision of unique bankingfunctions by other institutions are lowered.

Now, we come to my second topic: banking'sproblems posed by being a transmission belt formonetary policy. Commercial banks are in aunique, and unenviable, position, in that the initialbrunt of monetary policies must be carried outthrough the banking system. However, one mayproperly distinguish between the two principalweapons used by the monetary authority in recentyears. By far the most basic is the control over thetotal money supply and the total monetary base,exerted by the monetary authority primarilythrough its open-market operations. Within someranges, the monetary authority, over any period ofa few months, is able to control rather directly thegrowth in the money supply. That control is ad-

mittedly a very powerful weapon in influencing theoverall level of economic activity, although con-troversy continues between so-called "monetarists"and "fiscalists" as to the force and timing of thatinfluence.

The banking system is in the front line, so tospeak, in the transmission of the effects of overallmonetary policy to the economy. That transmissionmechanism functions through the general avail-ability, or non-availability, of loanable funds in thebanking system, and through the pricing device ofrates of interest. The recent past shows again thatthe banking industry tends to be blamed for highinterest rates, even when those rates are a directresult of the monetary policy prescribed by themonetary authorities.

The banking industry cannot duck its responsi-bility for transmitting the effects of monetarypolicy. However, a second weapon of monetarypolicy in recent years has been Regulation Q, im-posing ceiling rates on time and savings deposits ofcommercial banks. Those ceiling rates were wellbelow market rates for comparable savings instru-ments for many months. Even the January 1970increases in ceilings are still somewhat below pre-vailing rates. The runoff of large CD's from over$24 billion to less than $11 billion in a little over ayear, provides an excellent illustration of the factthat a money market instrument which is subjectto below market ceilings cannot long compete withother money market instruments not subject toceilings.

There is a responsible school of thought whichholds that the use of regulations that divert fundsfrom one deposit institution to another or, for thatmatter, from the credit instruments of deposit-typeinstitutions to other financial instruments, is notnecessary to the attainment of desired monetarypolicy. Let me quote two paragraphs from the NewYork Times of March 3:

In its report, the . . . bank leveled some polite,but nonetheless sharp, criticism at the FederalReserve Board in Washington for using its powerto prevent banks from paying competitive in-terest rates on their time deposits.This policy, the bank said, did not take fullyinto account the ability of borrowers to bypassthe banking system and obtain funds directly inthe open market. The distortions and supervis-ory problems this policy produced, the bank said,"suggest that more sparing use of this type of

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restriction on market competition is probablydesirable."That statement could be interpreted as a substan-

tial challenge to existing policies of the Federal Re-serve. It could have emanated from any numberof commercial banks. Be that as it may, the sourceis the Federal Reserve Bank of New York. I couldgive you additional quotations which illustrate that,even within the Federal Reserve System, there isno monolithic view as to the proper use of rateceilings.

In defense of the Federal Reserve Board, weshould note that the most recent upward change inceilings are a move in the direction of eventuallyconverting ceiling rates to standby ceilings. In fact,there is some indication that a majority of theBoard now favors placing ceilings on a standbybasis just as soon as practicable. Secondly, we can-not ignore the problems of the housing industry inconnection with any discussion of Regulation Q.The most common interpretation of the handlingof Regulation Q controls from 1966 to the presentis that the ceilings have been structured to allowthrift institutions, the prime suppliers of housingcredit, to hold more funds than they would other-wise have been able to do.

Whatever justificatons for Regulation Q are ad-vanced, bankers have seen their deposit totals drop-ping in recent months, and have been unable tosweeten the pot to hold those deposits. In turn,the banker was forced to turn down loan requestsfrom long-standing customers. The customer, then,if sufficiently large and well-known, often resortedto a direct sale of commercial paper, which in turncould be purchased by the erstwhile depositor ofthe commercial bank. The banker who observessuch a series of transactions may be at a loss tounderstand how it advances monetary policy goals.

REMARKS OF DEAN E. MILLER, DEPUTY

COMPTROLLER FOR TRUSTS, BEFORE THE

AMERICAN BANKERS ASSOCIATION FIDUCIARY

RESPONSIBILITY SEMINAR, WASHINGTON,

D.C., JULY 22, 1970

Shortly after being asked to give this talk, abooklet, entitled The Economic Power of Com-mercial Banks, by Carter Golembe Associates cameinto my possession, and there, in Chapter 4, wasmy talk, already written for me. A cursory read-ing showed me that it obviously was comprehensive,for it cited me twice, and anyone who pores

through my old talks must be a scholar of themost extreme devotion.

Seriously, I have read Chapter 4 of the Golembereport, concerning the regulation of bank trustdepartments, and would like to begin by makinga couple of general observations with reference toit. First, it is in many respects, photographic. Ayear from now it may be out of date by reasonof being incomplete, if the banking agencies con-tinue to keep pace with the legitimate demandsfor supervision as this business becomes more andmore complex. The attitude at the agencies issomewhat different from that which has occasionallyexisted. At times, trust department supervisionhas been in the position of the poor relation, withthe priorities for assigning personnel, schedulingexaminations, and determining corrective actionsin trust departments extremely low, and with theincidence of original and innovative thought vir-tually absent. We have enjoyed a significant periodof innovation in trust supervision in more recentyears; it is continuing and, I warn you, may, intime, make the specifics mentioned in Golembe'sChapter 4 obsolete.

While I'm on this point, let me make clear thatby innovation I do not mean simply an increaseof permissiveness. We have, in recent years, re-moved controls which served no useful purpose,and, I do not refer solely to collective investmentof agency accounts. The Comptroller made numer-ous changes in Regulation 9, for example, to re-move its unwarranted rigidity in trust departmentorganization and operations, and to remove in-vestment limitations when they were more restric-tive than the local law of trusts. The other agencieshave generally followed these precedents. But theComptroller has also imposed controls in areaswhich have not always been recognized by personsoutside the industry. The placing of all forms ofcollective investment, including pooled pension andprofit sharing trusts, not just traditional commontrust funds, under regulatory limitation and super-vision is probably the most significant example,but there are others.

In another vein, the Comptroller's Office tooka significant step toward more responsive trustsupervision several years ago when it establisheda separate trust division reporting directly to theComptroller. This permitted prompt staff work ontrust problems and speedy resolution of manage-ment decisions and initiation of corrective action.It also fostered the acquisition of greater expertise

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by transferring, to a few specialists, work that manyhad shared on a part-time, low-priority basis. Ibelieve that this must eventually be the patternfollowed by all the banking agencies, whether theycontinue under their present divided structure orare consolidated into one.

To return again to the Golembe study, thesecond observation I would like to make is that itdoes not explicitly express the philosophy of reg-ulation followed by the banking agencies. It hasbeen the policy, over the years, to keep the ab-solute prohibitions to a minimum. This policyhas two aspects. First, the mere possibility thata particular practice could result in abuse if abank were to depart from recognized fiduciaryprinciples has not been deemed sufficient causefor forbidding the practice outright, if it providesa desirable service when performed responsibly.Only when existing regulations prove insufficient tocontrol abuses has it been felt that specific bansshould be imposed. Secondly, there is the belief thatit is an unrewarding practice to compile a list ofrestrictions and limitations, in regulatory form,purporting to be all-inclusive. The position takenby our Office is, almost always, analysis, premisedupon conformity to sound fiduciary principles.Therefore, short shrift is given to those who seekto justify a breach of fiduciary duty because of theabsence of specific statutory or regulatory languageforbidding the precise act. It is misleading, in seek-ing to apprise oneself of the activity of the bank-ing agencies in this area, to look, somewhere infederal law or regulations, for a vast catalogue ofdo's and don'ts.

Also, with reference to Mr. Golembe's report,I recommend that you not conclude from it thatthe banking agencies are infallible. I am the firstto admit that they stumble and fall occasionally.When we do, we try to pull ourselves up and learnfrom the experience.

As Carter Golembe points out, the various federalbank supervisors regularly examine the trust de-partments of banks for which they are respon-sible. Thus, the Comptroller examines trust de-partments of National banks, the Federal Reserveexamines State member banks, and the FDIC ex-amines State non-member insured banks. In addi-tion, trust companies, and the trust departments ofState banks are examined by the State bank super-visors. Corrective actions required by those super-visors as a result of such examinations are carriedout without public disclosure, to minimize the pos-

sibility of jeopardizing the soundness of the bank,or breaking the confidentiality implicit in fiduciaryaccounts administered by banks. This modus ope-randi, which is characteristic of the banking agen-cies and is, I believe, most appropriate for this in-dustry, naturally has had the side effect that theseactivities are not always known to the casual ob-server, and even the not so casual one. Thus it isthat I welcome the opportunity to come to thislectern today and review for you the story of thebank supervisor.

When the federal bank examiners first beganto look at trust departments, they brought withthem procedures evolved from examining the com-mercial side of the bank. They physically verifiedthe assets and checked the accuracy of the book-keeping systems, using forms adapted from thecommercial examining function. Line cards werefashioned, onto which were transcribed cash andinvestment balances, in a fashion similar to thetaking of loan balances on the commercial side.The question of compliance with sound fiduciarypractices did not get much play in those days, butan excellent system for checking the adequacy ofthe books and records, and the integrity of theassets of the department was established at anearly date.

The course of supervision since then has beenprimarily characterized by the addition of pro-cedures and techniques aimed at the question ofcompliance with applicable laws, regulations, andsound fiduciary principles in the administrationof trust department accounts. In the early 1930's,specialized procedures for checking investmentswere adopted by the agencies. Our examiners be-gan to brief the appropriate governing instrumentson the line cards, and they do so to this day forall accounts where the bank has some measure ofinvestment responsibility. They look at the assetsof the account to see if the investments conformto the "law" for that account, the "law" being anadmixture of the governing instrument provisionsand the law of the State on investments by fidu-ciaries. They pay special attention to substandardassets and those involving a conflict of interest withthe bank, or any person with whom there existsan interest such that it might affect the exerciseof the best judgment of the bank, in making orretaining the investment. They also look for con-centrations, both within individual accounts, andin the totals of particular issues held by trust de-partments. Any of the latter that are large enough

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to raise the question of possible control or affilia-tion are reported by our examiners. They canalso, and well might, criticize, as an investmentmatter, a holding of a particular issue which, intheir judgment, is too large. The banking agencieshave not attempted to formulate and impose anybroad scale policy for larger holdings where theredoes not appear to be any question of lack ofauthority, of affiliation, of ulterior motive, or ofpoor investment practices. Neither have they at-tempted to make any policy judgments on eco-nomic or social desirability or the effect of thelarge holdings of stocks that do generally exist intrust departments. Such judgments require theresolution of questions of national policy, and thusmust be made by Congress. Once made, it wouldappear that the decision can most appropriatelyand effectively be implemented by the bankingagencies.

To return to my chronicle of the developmentof trust department examination, the next stage,if you can call it that, began when the examinersstarted to pursue a number of diverse possibilitiesfor bank misuse of its fiduciary franchise, or neglectof its attendant duties. That "stage" didn't reallyhave a formal beginning. It developed that, as theWashington or Regional Office, or the examinersthemselves, became aware of a particular matterwhich warranted scrutiny, that matter was addedto the examination. Such things as checking thefilings of accountings, tax returns, or forms underthe Welfare and Pension Plans Disclosure Act arebut a few examples. Holdings of restricted or con-trol stock, and the incidence of security fails aremore recent additions, and inquiry is now beingmade into the banks' policy in allocating broker-age business. Many such checks pertain to localrequirements, such as filings of accountings, andmay vary from region to region, reflecting the widedivergence in probate practices and requirements.To date, this has rendered it impossible for us toestablish a complete and uniform standard operat-ing procedure for nationwide use, even though thereport of examination questions, and relevant in-structions are universal for our examiners. Thus,while the questions to be answered are the same,as are the underlying regulations and policies, therehas existed a certain discretion in the examiner indetermining in what order, and in some cases, how,he obtains the answers to these questions. In everycase, our examiners must obtain them throughtheir own scrutiny of the records, or the use of

written questionnaires which must be signed by aresponsible bank officer. As you know, giving afalse reply to a bank examiner is a crime. We donot accept verbal replies. Currently, we are work-ing on a standard procedure, adaptable to all re-gions and all sizes of departments; the draft ispresently some 90 pages long.

Today the trust examiner is concerned withproper record keeping and the probate, trust, tax,securities, and pension and welfare laws, as well aswith the myriad administrative regulations andrulings that accompany them. In addition, it ap-pears that future additions to that list might in-clude antitrust laws and some of the various pro-posals presently being made regarding the advance-ment of particular social purposes. For, howeverfar these laws may go in conferring enforcementauthority upon other agencies, the bank super-visors cannot, as a result, ignore the possibilityof undetected potential losses because of a breachof their provisions. I can't imagine anyone exonera-ting the banking supervisors if a violation of oneof these "other laws" was uncovered in a bank thathad been examined regularly for years, simply be-cause the law was someone else's primary respon-sibility.

Let me close with a bit of philosophy. What Ihave just said is not a complaint; rather, I thinkthat this is, as it should be, a matter of publicadministration, and should serve as a guide as toother regulated businesses. The growth of govern-mental supervision, regulation, control, whateveryou may wish to call it, over business has nowproceeded to the point that there are many federaland State agencies with which any businessmanmust cope. Each particular set of governmentalpolicies has its own agency, its own laws and regula-tions, and, all too often, its own army of enforcers.Rather than taking cognizance of this waste andinefficiency on the part of government, and theresulting confusion and obstacles faced by busi-ness, the present proposals for new controls onlypromise to worsen the picture. It would make moresense in terms of economy and efficiency, coordina-tion of governmental policies, and the removal ofimpediments to business activity, to follow thepattern suggested by the bank supervisory setup;one agency can serve as the point of initial ap-plication of all governmental policies to a par-ticular industry. While I have not grown old inthe federal service, I have assembled enough ex-perience to have some authority when I say that

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there is precious little merit in the oft-expressedbureaucratic assertion that "only we have the ex-pertise to see that our responsibilities are carriedout—we couldn't possibly rely on someone else."None of us are either omniscient or indispensable.In all candor, I would have to admit that in somecases my proposal would require the acquisition ofnew skills and the performance of additional func-tions by the banking agencies, but, I also thinkthat their recent history demonstrates their capa-bility, when motivation is present at the top.

Thank you.

REMARKS OFDEAN E. MILLER,

DEPUTY COMPTROLLER FOR TRUSTS,

BEFORE THE MID CONTINENT TRUST CONFERENCE

OF THE AMERICAN BANKERS ASSOCIATION,

CHICAGO, I I I . ,

Nov. 19, 1970

The professional fiduciary business today is in anera which might be characterized as one of trans-formation; some might say that "transfiguration"is a better word, while to others, "transmogrifica-tion" would appear more apt. Whether this process,however you label it, will affect only the outwardappearance of the industry or will result in an alter-ation of its basic structure remains a matter ofuncertainty. You can obtain opinions on bothsides and in the middle. Going beyond opinions,you can find those conclusions, reflected, bothconsciously and unconsciously, by the actions ofvarious banks and their trust departments.

The relatively recent widespread interest in theactivities of bank trust departments certainly hasimplications of possible structural change. Alreadythere are legislative and administrative proposalsbeing advanced in the Congress, in the courts, andin the Federal Register which will accomplish suchalterations. Some have already come to fruition.They are seen in the tax, antitrust, labor, pension,and communication fields, to name a few. Thefact that one has to apply so many labels to thoseproposals, all affecting this one business, tells ussomething rather basic about the administrativeprocess, but that's another speech.

There are also more far-reaching portents ofchange: Banks and their trust departments havebecome the subject of scholarly study. Speaking interms of eras, this has become one in which studies

themselves have become suspect, increasingly sub-ject to the accusation that they do no more thanprovide a platform of respectability for conclusionsalready held by those causing the study to be made.I have heard such accusations about some studiesbeing made of bank trust departments, but thatalso is another speech, one that someone else mayhave to make.

A different factor in the transformation of banktrust business gives rise to my topic today. It is thechange largely being brought about by the banksthemselves. Competition for trust business has in-creased to a marked degree. One of competition'snatural by-products is stimulation of the develop-ment of features that appear to make one com-petitor's product superior to that of another. Wesee that in the drive for performance in the trustarea, which has raised new theories as to what the"Prudent Man Rule" is. We see it also in the pro-motion of new trust department services, and inunique variations of the old ones, which raises thequestion of what legitimate banking services are,and what bona fide fiduciary activities are. (Thatdog just won't die.) We also see it in the broaden-ing of bank activities in general, which sometimeshas implications for the trust department.

Those phenomena have given birth to a numberof questions which form the frontier of the law oftrusts today. That frontier exists, whether we likeit or not, and we might as well face it and talkabout it. That some may already have crossed thatfrontier in some of their activities may mean onlythat they are living among savages, not that theyhave succeeded in pushing the border further. Itrests with the courts, faced with a bank and thatlegendary fundless widow, to settle the boundarydisputes; rhetoric will not be sufficient toward thatend.

Now let me make the transition from the beauti-ful broad generality to the ugly narrow specifics.The first specific frontier I would like to deal withis the present location of the "Prudent Man Rule,"and how far it extends. That rule, when it was firststated, in the case of Harvard College v. Amory,was an investment rule. It supplanted the legallists, the general prohibitions on categories of in-vestments, and all that had gone before. It was notconceived as a general qualifier of the entire rangeof a trustee's duties as recognized in common lawover the years. It did not proclaim that the trusteecould do as he wished as long as he was prudent.It did not furnish a qualification to the conflict of

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interest rules. It did not provide that a trusteecould deal with himself as long as he was prudent.It did not provide that he could speculate pru-dently.

That last probably presents the question a bitunfairly. More objectively, and in contemporaryterms, in an account where growth is the primaryor most significant objective—although it is per-haps not expressly stated—how consistent with the"Prudent Man Rule" is an investment in a newand untried enterprise, a restricted stock, invest-ment partnerships, or some of the other forms oflong-term joint ventures?

No court, to my knowledge, has upheld a trusteeunder the "Prudent Man" theory, or any othertheory, in a situation involving losses by widowsand orphans because of that type of investment.Thus, we have no concrete indication that the prin-ciples of fiduciary administration which haveevolved over the years, and which are a part of thelaw of trusts, have changed that much. Can we relyon such factors as an allegedly more sophisticated,or more enlightened, climate existing today? Dothese theories of selectivity rest on anything else?If one reads some of the journals of the twenties,one finds similar assertions as to the growth of thecommon law. In the thirties, it was found that ithadn't grown nearly as much as was thought in theprevious decade. Are things different now?

One of the less precisely illuminated areas of thelaw of trusts today is the extent to which a trusteeis improperly delegating his investment responsi-bility, if at all, when he participates in a joint un-dertaking in which the selection of the underlyingassets rests with someone else. Perhaps the conven-tional examples of this would be investment com-panies, and, more recently, real estate investmenttrusts. There is disagreement, in the decisions andcommentaries, as to whether an investment inmutual fund shares is an improper delegation, withmore recent views denying it. Even if such an in-vestment were an improper delegation under thecommon law, the question is now academic becauseof the enactment, in many States, of laws givingtrustees specific authority to invest in investmentcompanies. Query whether such statutes also coverreal estate investment trusts, however.

I have had mixed emotions about the delegationquestion. On the one hand, I think there is some-thing inconsistent about a professional fiduciaryclaiming that it does not have enough expertise ininvestment management, and therefore must en-

trust another with the funds. It would seem thatthe trustee who, in effect, does that, through invest-ment in a real estate investment trust, for example,should take a lesser fee than if it invests the trustfunds itself. But, it is said, on the other hand, thatthe expertise of the trustee is called for in choosingthe management of the particular fund, and thatthat process is little different from evaluating themanagement of any conventional company. In thisday, as "conventional" companies become more andmore diversified, this consideration carries muchforce. In addition, in the case of the real estateinvestments, there exist unique difficulties whichmight well be beyond the usual capability of thetrust department. Real estate is unique, and realestate located in other parts of the country oftenpresents the trust officer with insuperable difficultiesin evaluation. You might, therefore, make a strongcase for the proposition that the most prudent wayfor a trustee to invest in real estate is through a realestate investment trust.

From the foregoing we might conclude that atrustee may well delegate his investment responsi-bility, if prudent, although determining whereprudence ends and speculation or unwarranted re-liance upon others begins would present more prob-lems than usual. It may be that the boundary iscrossed in some investment partnerships availabletoday. Of course, none of this assumes the presenceof a conflict of interest on the part of the trustee.That is another frontier, to which it might be ap-propriate to turn our attention at this time.

Here I would like to challenge the product ofone of your local courts, the Glos case. More cor-rectly, it is the case of Elmhurst National Bank v.Glos, 99 111. App. 74, 241 N.E. 2d 12 1 (1968). Inthat case, the Appellate Court of the Second Dis-trict of Illinois ruled, to summarize very briefly,that a bank trustee could retain shares of its ownstock in a trust account with specific authority, ifprudent. To put it bluntly, we believe that thecase is wrong, that the court erroneously extendedthe "Prudent Man Rule" beyond its proper appli-cation, and that it is highly doubtful that a courtof final jurisdiction would rely on it. For thatreason, you might say that we do not acquiesce.

There are related questions on this subject thatare raised by the rationale of the Glos decision.What if the shares of the trustee bank's stock havebeen exchanged for that of a holding company?In many States there are retention statutes broadenough to cover this situation; in others, there are

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not, and the governing instrument provisions maybe of doubtful help. Can the holding companyshares be retained under the "Prudent Man Rule"?If so, then the holding company shares will be re-tained in every case, for what banker is going tobelieve that his decision to move into a holdingcompany is an imprudent one? The problem thatI am suggesting is one of the separation of the func-tions of a banker in such a situation. If prudenceis the sole guide, then it would seem that there islittle limitation upon the use of trust funds toacquiesce, if not assist, in the expansionary movesof the bank. Indeed, you can make a compellingcase in logic for the outright use of trust funds inthe bank's commercial lending business. I don'tsuggest that anyone here believes that the "PrudentMan Rule" can be taken that far, and I don't meanto imply that this is taking place. Rather, I thinkI have shown the absurdity of trying to stretch thatrule to cover all of the duties of the trustee, thetrend shown in some of the recent, hasty, and ill-considered legal and judicial opinions, exemplifiedby the Glos decision.

The law of trusts has not "progressed" so far. Itstill requires that decisions pertaining to trust ac-counts be made with sole reference to the purposesof the account and the best interests of the bene-ficiaries. It requires, also, that before a bank trusteecan perform an act, consistent with that standard,but involving self-dealing or a conflict of interest,he must have specific authority to do so in thegoverning instrument or local law. In seeking todetermine whether any investment is proper, orprudent, the inquiry must be twofold: first, is itwithin the authority given; and, second, is it con-sistent with the purposes of the trust and in thebest interests of the beneficiaries?

The necessity of that second inquiry has eludedsome of the outside detractors, whose tactics, thusfar, have been to study the business only so far asnecessary to uncover a supposed flaw, howeversuperficial, and then to proclaim it with their newfound authority as experts. The same oversight hasalso been the failing of some of the casual legal and

judicial opinion writers, who, even when exposedto this rule, fail to comprehend it. For example,recently, a learned attorney, upon being informedthat we believed that properly authorized invest-ments must also be consistent with the purposes ofthe trust, opined that the purpose of a directionpension trust was for the trustee to make invest-ments as directed. Obviously, it is to provide apension for employees upon their retirement, andthat must control.

I have occasionally complained of detractors ofbank trust departments, and trust supervision, whoseek to make their cases after either superficial, orextremely unobjective, investigations. Equally irri-tating, however, is the defender of trust depart-ment practices who employs similar methods. Thebank lawyer, or the trust officer, who fails to sub-ject his proposed transactions to thorough, intro-spective, and objective analysis does the bank fi-duciary business, and the public interest, as muchof a disservice as do the critical outsiders. And, Iwould especially include in that indictment thosecommercial banking chief executives who give theirtrust activities so little considered attention. In thisera of increased awareness of bank trust depart-ment activities, the substanceless platitudes thatseem to be all that some commercially-orientedbank chief executives can come up with, simplywon't do.

The corporate fiduciary business, and its applic-able laws and regulations, are exceedingly complex.Dealing properly with these matters requires agreat deal of thought and study, bottomed on athorough knowledge of the principles of the law oftrusts. It is very tempting, when facing a problemin this area, to rely instead upon simplistic charac-terizations of the effect of applicable laws andregulations on bank activities, both present andproposed. No one, neither the banks, the banksupervisors, nor the critics of banking, should makethis mistake if they are sincerely interested in pro-viding the public with the most competent andconvenient professional fiduciary services.

Thank you.

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INDEX

Addresses of the Comptroller of the Currency, 255-61Administration of the Comptroller's Office, 21-23Administrative Assistants to the Comptrollers, listed, 184Administrative Services Division, 22Armored car service, 16Assets of the Comptroller's Office, 26Assets of National banks:

of acquiring and acquired banks, 1960-1970, 208by deposit size, 222of foreign branches, 1953-1970, 250of foreign branches, Dec. 31, 1970, 250at last condition report, 1950-1970, 248in 1969 and 1970, 2by States, June 30, 1970, 225by States, Dec. 31, 1970, 228of trust accounts, 251

Balances per credit card, 221Bank chartering. (See Charters and chartering.)Bank examination:

administration of, 22new procedures in, 13summary of 1970 activities in, 13of trust departments, 265-66

Bank holding companies, 255-57, 262-63Bank mergers. (See Mergers.)Bank regulation, 255-57Banking:

criticism of, 258-59expansion of, 255-57litigation on, 14-15, 262monetary policy transmitted by, 263-64new functions of, 259-61potential of, 260proper role of, 261-63supervision of, 264-67

Banking offices, by States, Dec. 31, 1970, 6Branches of National banks:

in calendar 1970, 10closed in 1970, 219-20de novo, 5, 10-12foreign, 20, 249, 250, 261litigation on, 16-17opened in 1970, 209-18by States, Dec. 31, 1970, 6

Camp, William B.:addresses of, 257-61Congressional testimony of, 255—57

Capital accounts of National banks:by deposit size, 222from 1944 to 1970, 246in 1969 and 1970, 2by States, June 30, 1970, 227by States, Dec. 31, 1970, 230

Capital stock of National banks, 187Cases in litigation, 14-18, 177-79Changes in structure of National Banking System, 186Charters and chartering:

applications by States, 1970, 7, 188-89applications pursuant to corporate reorganization, 8, 189and conversion by State banks, 9, 195issued in 1970, by States, 7, 190-91issued pursuant to corporate reorganization, 8, 196litigation on, 15

Clayton Act, 18Closing of branches in 1970, by States, 219-20Collective investment funds, 14Commingled managing agency accounts, 14Comptroller of the Currency, Office of:

administration of, 21-23Administrative Assistants to the Comptrollers, listed, 184Comptroller's addresses and Congressional testimony, 255-61Comptrollers, listed, 183Deputy Comptrollers, listed, 184

Deputy Comptrollers' addresses, 261-69financial operation of, 25-28litigation, 14-18organization chart of, 24regulation of holding companies, 257trust supervision, 264-66

Comptroller's equity, 25-27Condition of National Banking System, 1-2Condition report dates, 1914-1970, 223-24Congressional testimony of William B. Camp, 255-57Consolidations:

of National banks, 199-200of National with State banks, 197, 199-200(see also Mergers.)

Conversions:of National into State banks, 198of State into National banks, 9, 195

Corporate reorganization:charter applications pursuant to, 8, 189charters issued pursuant to, 8, 192-94, 196

Credit card balances, 221Credit card transactions, 15Criticism of banking, 258-59

Data processing services, 256Dates of reports of condition, 223-24De novo branches, 5, 10-12Deposits of National banks. (See Assets of National banks.)Deputy Comptrollers of the Currency, listed, 184Dividends of National banks, 246

Electronic data processing (EDP), 13Equity, Comptroller's, 25-27Examination of banks. (See Bank examination.)Expansion of bank activities, 255-57Expenses of Comptroller's Office, 27-28Expenses of National banks:

by deposit size, 244-45in 1969 and 1970, 3-4by States. 232-43

Fiduciary activities. (See Trust departments.)Financial operation of the Comptroller's Office, 25-28Fiscal Management Division, 21Foreign branches:

assets of, 1952-1970, 250assets and liabilities of, Dec. 31, 1970, 250expansion of, 261and international finance, 20number of, 1960-1970, 250by region and country, 249

Golembe report, 264-65

Holding companies, 255-57, 262-63

Incidental powers, litigation on, 14, 257Income of National banks:

by deposit size, 244-45from 1944 to 1970, 246in 1969 and 1970, 3-4by States, 232-43of trust accounts, 251

Interest on credit card transactions, 15Internal Audit Division, 23International banking, 20, 261Investment funds, 14

"Laundry list" of banking activities, 255-56, 262-63Law of trusts, 267-69Liabilities of Comptroller's Office, 26Liabilities of National banks:

by deposit size, 222of foreign branches, 250at last condition report, 1950-1970, 248

271


in 1969 and 1970, 2by States, June 30, 1970, 226by States, Dec. 31, 1970,229

Liquidation of National banks, 197Listing of National banks, by States, 6Litigation on:

banking activities, 262branches, 16-17collective investment funds, 14incidental powers, 14, 257interest on credit card transactions, 15main office relocations, 15-16mergers, 17-18, 177-179new banks, 15

Loans of National banks:from 1945 to 1970, 247by States, 231

Losses of National banks, 1945 to 1970, 247

Main office relocations, 15-16Management Services Division, 23Managing agency accounts, 14Mergers, 30-179:

approval opinions, 34-179approvals, listed, 30-33in 1970, 12, 30-33involving 2 or more operating banks, 30-32, 34-158litigation on, 17-18, 177-79of National with State banks, 197pursuant to corporate reorganization, 32-33, 159-76, 192-94resulting in National banks, by assets, 1960-1970, 208by States, 1970, 201-8

Miller, Dean E., remarks of, 264-69Monetary policy, 263-64Motter, David C, remarks of, 261-64

Newly organized National banks:litigation on, 15by States, 190-91

Number of National banks in each State, 6

Office of the Comptroller of the Currency. (See Comptrollerof the Currency.)

One-bank holding companies, 256-57, 262-63Opinion of independent accountant, 28Organization chart of the Comptroller's Office, 24Outstanding balances on credit plans, 221

Personnel Division, 21, 22Potential of banking industry, 260-61"Prudent Man Rule", 267-69Purchases of State banks by National banks, 199

Recoveries of National banks, 1945 to 1970, 247Regional Administrators of National banks, listed, 185Regulation of banking, 255-57Regulation Q, 263-64Rejected applicants, litigation by, 15Relocation of main offices, 15-16Reports of condition, 223-24Revenue of Comptroller's Office, 27

Securities of National banks:losses and recoveries on, 1945 to 1970, 247in 1969 and 1970, 2

Services of banks, 255-57, 262State banks:

consolidations of National banks with, 197, 199-200conversion of National banks into, 198conversion to National banks, 9, 195mergers with National banks, 197, 201-8purchased by National banks, 199

Structural changes in National Banking System, 5-12, 186

Trust departments:activities summarized, 19assets and income of, by States, 251litigation on, 14and "Prudent Man Rule", 267-69supervision of, 264-67transformation in, 267-69

272
