SUBCOMMITTEE OF THE COMMITTEE ON BANKING AND CURRENCY. HOUSE OF REPRESENTATIVES. ARSÈNE P. PUJO, Louisiana, Chairman. WILLIAM G. BROWN, West Virginia. R. W. FONTENOT, Clerk. GEORGE A. NEELEY, Kansas. A. M. MCDERMOTT, Assistant Clerk. II D. OF D. MONEY TRUST INVESTIGATION. SUBCOMMITTEE OF THE COMMITTEE ON BANKING AND CURRENCY, HOUSE OF REPRESENTATIVES, Washington, D. C., Thursday, December 19, 1912. The subcommittee met at 10.30 o'clock a. m. Present: Messrs. Pujo (chairman), Stephens, Daugherty, Byrnes, Neely, McMorran, Hayes, and Heald. Present also: Samuel Untermyer, Esq., of New York City, counsel for the committee. TESTIMONY OF MR. J. PIERPONT MORGAN—Continued. The CHAIRMAN. There being a quorum of the committee present, the committee will be considered in session and the examination of Mr. Morgan will be resumed. Mr. UNTERMYER. Mr. Morgan, can you give the committee a statement of the total amount of deposits of your banking firm in New York as of the 1st of November, 1912, including all deposits? Mr. MORGAN. I have not got it here, sir. Mr. UNTERMYER. Can you approximate it? Mr. MORGAN. I should think one hundred millions. Mr. UNTERMYER. You have given us a statement of upward of eighty-one millions held by your banking house in New York on behalf of interstate corporations? Mr. MORGAN. Yes. Mr. UNTERMYER. Seventy-three interstate corporations, I believe? Mr. MORGAN. Yes. Mr. UNTERMYER. Would you say, then, that there are only about twenty millions of average deposits outside of those? Mr. MORGAN. I should think, there were more than that. Mr. UNTERMYER. So I supposed. Mr. MORGAN. Say one hundred to one hundred and ten. not give the exact figures. I can Mr. UNTERMYER. Will you furnish those figures to be put in the record? Mr. MORGAN. I will. Mr. UNTERMYER. Does your banking house pay interest on these interstate deposits? Mr. MORGAN. We do, sir. Mr. UNTERMYER. Are you, or is any member of your firm, a director in the corporations that deposit their funds, or a part of their funds, with your banking house in New York? Mr. MORGAN. With some of them. Mr. UNTERMYER. Will you furnish the committee with a statement of those interstate corporations that are represented on the board by some member of your firm? Mr. LINDABURY. We have done that. Mr. MORGAN. I think you have them already on file. Mr. UNTERMYER. No; we have no such information. I am referring to interstate corporations that have accounts with J. P. Morgan & Co. Mr. LINDABURY. I did not get the latter part of your question. Mr. UNTERMYER. We have no such statement; but you will furnish it? Mr. MORGAN. Yes. Any statement of that kind you shall have, sir, with great pleasure. Mr. UNTERMYER. That is, we want the names of those of the interstate corporations in which some member of your firm is a director and those that are depositors with J. P. Morgan & Co. Mr. MORGAN. Yes. Mr. UNTERMYER. Has the firm of Morgan, Drexel & Co., of Philadelphia, the same method of doing business; that is, so far as concerns the receipt of deposits from interstate corporations? no, Mr. MORGAN. They have, sir. Mr. UNTERMYER. And do you know the extent of its deposits? Mr. MORGAN. I do not think I have them here. I do not, myself; sir. Mr. UNTERMYER. And you can not approximate them from memory? Mr. MORGAN. No; I could not from memory. Mr. UNTERMYER. Will you be good enough to furnish the committee with that data as of January 1, 1912, and November 1, 1912 ? r. MORGAN. We will, sir. Mr. UNTERMYER. There is no objection to that? Mr. MORGAN. Not at all. Mr. UNTERMYER. As to the London and Paris houses, have you the same system of doing business there? Do you receive deposits there? Mr. MORGAN. Not to any great extent, sir. I can not say that we do not take any. Mr. UNTERMYER. They would be infinitesimal, would they? Mr. MORGAN. Comparatively; yes, sir. In the case of the Paris house, of course, the business is largely that of travelers who happen to be in Europe; but there is no commercial business. Mr. UNTERMYER. I am not speaking of letters of credit or that class of deposits. I am speaking of deposits against check by interstate corporations. Mr. MORGAN. We do not keep those accounts to any extent. Mr. UNTERMYER. At the adjournment last evening, Mr. Morgan, we were discussing this subject of fiscal agents. Mr. MORGAN. Yes, sir. Mr. UNTERMYER. I think you have here, have you not, one or two of those fiscal agency agreements? Mr. MORGAN. I think so. Mr. LINDABURY. We telegraphed for them overnight and have gotten them. Mr. MORGAN. Shall I hand them to you? Mr. UNTERMYER. If you please. [The papers referred to were handed to Mr. Untermyer.] Mr. MORGAN. You will find that these are divided into two sections, the New York Central and allied lines and the New Haven and allied lines. Mr. UNTERMYER. Are these copies that we may use, or are they the originals? Mr. LINDABURY. They are copies that you may use. Mr. UNTERMYER. How many such agreements have you in all, do you know? Mr. MORGAN. In writing? I think that is all we have. Mr. UNTERMYER. How many such fiscal agency arrangements are there outstanding? Mr. MORGAN. None, except what you have there-except by tacit agreement. Mr. UNTERMYER. That is what I meant. You are acting as fiscal agents for a number of these corporations, are you not? Mr. MORGAN. We are; yes, sir. Mr. UNTERMYER. Among others, for the United States Steel Corporation, are you not? Mr. MORGAN. Yes, sir. Mr. UNTERMYER. And that is under a resolution of the Steel Corporation? Mr. MORGAN. That is under a resolution of the Steel Corporation. I know of no other. There is no written agreement. Mr. UNTERMYER. But all the others are merely by word of mouth? Resolution at a meeting of the board of directors of the New York Central & Hudson River Railroad Co., 16th of December, 1908: Resolved, That J. P. Morgan & Co. be, and they hereby are, appointed sole agents of this company to act for it whenever it requires the services of bankers to dispose of its securities. Such securities offered by them to the public shall be at such price and their commission on the sale thereof shall be such as may be agreed upon by them and the finance committee of this company. Said J. P. Morgan & Co. shall, on request, advance to this company upon the securities thus offered to the public, as collateral, up to 75 per cent of said offered price, such loans to be repayable within one year. This agency may be terminated at any time on 30 days' notice by either party. The secretary is directed to advise Messrs. J. P. Morgan & Co. of this appointment and to receive their acceptance thereof. Then follows the acceptance. Was this resolution followed by a written agreement? Mr. MORGAN. Nothing more than that, sir. Mr. UNTERMYER. Nothing more than the resolution and its acceptance in writing? Mr. MORGAN. It is all in the correspondence there. Mr. UNTERMYER. Who was the chairman of the finance committee of the New York Central & Hudson River Railroad Co. at that time? Mr. MORGAN. The president. Mr. UNTERMYER. Were you a member of the committee? Mr. MORGAN. I do not think so. I do not believe I was here. What is the date of that? Mr. UNTERMYER. The date of this is the 16th of December, 1908. Mr. MORGAN. I do not think I was here, but I do not remember. I am a member of the finance committee. Mr. UNTERMYER. You are a member of the finance committee? Mr. MORGAN. Yes, sir. |