culiar facilities necessary for the handling of immigrant business; and (3) the ability and willingness of the immigrant proprietor to perform for his countrymen necessary services that otherwise it would be impossible for them to obtain.

Possibly the great hindrance in securing immigrant patronage for American banks lies in the alien's ignorance of the English language. Inability to read and write, necessitating the transacting of business through an interpreter, combined with a poor comprehension of the check system and other banking devices, is apt to cause him to prefer more informal banking relations. A natural hesitancy to place confidence in strangers of other races is augmented in many cases by a positive suspicion of American institutions. A case in point is that of the Greeks in a certain locality who stood somewhat in awe of the magnificent proportions and equipment of the local American bank. An Italian banker said of his countrymen that their suspicions were aroused by the very richness and, to them, extravagance in the equipment of the average American bank. The Austro-Hungarian races show a similar inclination to look with distrust upon American institutions.

A possible explanation lies in the fact that these races, largely agricultural in character prior to coming to America, are not accustomed to the extended use of banking facilities, or, if so accustomed, confine their relations to the financial institutions operated by the government in their respective countries. They have learned that banks of this country are not government institutions, and for that reason look with disfavor upon them. Their limited experience abroad has been largely confined to postal savings-banks, and

it may be that the recent establishment of similar agencies in the United States may attract some immigrant depositors. It is very doubtful, however, whether such relations can ever be established with the large class of floating alien labor in this country. Ignorant of American customs, unable to use the English language, and finding but little encouragement to overcome his hesitancy, the immigrant turns to the bankers of his own race as the only ones really able to perform the services he needs.

OWNERSHIP AND ORGANIZATION

Immigrant banks are almost without exception unincorporated. They are, as a rule, privately and individually owned. The term "& Co.," and others of a corporate nature, frequently appear in the names of the establishments, but are meaningless in a majority of cases as far as indicating any distribution of ownership. They are used in the belief that they add a certain dignity to the firm. In every center of alien population there is a very sharp competition among banks conducted by men of the different immigrant races. Far from being united in a community of interest, a spirit of acrimonious rivalry is prevalent. Altho the connection with New York in one way is very intimate, there is no close alliance through ownership. It is believed that not more than a dozen of the immigrant banks of New York City have branches in the interior.

With some notable exceptions, branch banks are not maintained. Even when established they are usually confined to the immediate vicinity of the parent bank. Mismanagement and dishonesty on the part of those placed in charge appear to have been the leading

cause of failures in the attempts to establish branch banks. The business is essentially a local development. Of the 110 establishments from which specific information was secured during a recent investigation by the national government, 97 reported that branches were not maintained.

Banking Functions-Deposits

Immigrant institutions have only four distinct banking functions-deposits, loans, money exchange, and foreign exchange. Collections, domestic exchange, insurance, and rentals are carried on by a considerable number of banks, but the first four mentioned are the distinctive banking functions.

The receipt of deposits is as a rule merely incidental to the main functions of an immigrant bank and directly contributory to the personal interests of the proprietors. Immigrant banks are rarely commercial or savings institutions. Deposits are usually left for temporary safe-keeping rather than as interest-bearing savings accounts. Such deposits are not subject to check, and there is, therefore, seldom need of clearing arrangements. Many so-called bankers do not openly solicit deposits and do not make a practise of receiving them, while others actively seek deposits as an important part of their business. But whatever the capacity in which the banker receives money, it is essentially a personal one in which he disposes of it. Beyond an understanding that deposits are subject to demand at any time, there is no consideration given nor limitation implied as to their use. So far as his depositors are concerned, the immigrant banker is at liberty to use their funds to suit himself a fact startlingly significant in view of the lack of security afforded.

The customary informality with which deposits are tendered and received, the passive attitude of depositors as regards the use to which they may be put, and the want of legal and financial responsibility for their safe-keeping, result in a failure to distinguish between the affairs of the bank and those of the banker. Where the latter is the sole owner of the establishment, as was found to be the case in four-fifths of those examined by the Immigration Commission, and the banker finds himself under no restrictions as to the use of funds left with him, he will ordinarily take advantage of that fact to invest them to his own ends without much regard for the solvency of the bank.

The most objectional use to which deposits are usually put is that of direct investment in the proprietor's own business. Grocers and saloon-keepers have admitted that deposits are used freely, to meet current bills, or are invested outright in their concerns.

Many immigrant bankers, especially in the smaller towns where the principal profits arise from the sale of steamship tickets, redeposit the funds intrusted to them in national or State banks. Many bankers thus derive from 3 to 4 per cent. interest on thousands of dollars which have been deposited with them, but upon which they are making no returns. If deposits are subject to such an active demand as to prevent their redeposit as a savings account in a federal or State bank, they are often deposited as part of the immigrant banker's checking account and thus made to yield a low rate of interest.

As a rule the immigrant bankers are not satisfied with the small profit secured by redepositing funds placed in their care. They seek opportunities yielding a larger return and in this way deposits come to be

used for loans or investments. The larger and best class of immigrant banks make loans, just as the ordinary American bank, in the regular course of banking operations.

The most usual evidence of deposit furnished by the immigrant banker is the ordinary pass-book used by American banks. In some cases only a personal receipt or a deposit slip of the usual form is given to the depositor. Some of the smaller institutions make use of a secret word, and a few of the more irresponsible banks furnish no evidence of deposit whatsoever. The value of pass deposit books and deposit slips in a great number of cases is also rendered worthless by the immigrant laborers who, on account of their credulity and ignorance, leave the pass-book with the bankers for safe-keeping after having made a deposit.

Deposits left for safe-keeping are seldom allowed to accumulate to an amount greater than $100. Individual sums in excess of that amount are sometimes left for short periods, and the average savings account in some banks reaches $200 and $300. But $100 appears to be the limit of an accumulation against a remittance home. In the table on page 106 are shown the aggregate amounts of deposits, the number of depositors, and the average amount of deposits of 31 immigrant bankers of different races, including some of all the classes of banks.

While the aggregate sum held by these 31 banks is comparatively insignificant, yet it represents the savings of over 3,000 laborers, the average of deposits being $65.45. It is obvious in this connection that the average deposit is too small to warrant bringing a suit in the event of the refusal of a banker to pay.