BANK ADMINISTRATION—SHAREHOLDERS AND DIRECTORS The Management of a Bank With the exception of certain private banks, banks in general are corporate institutions and as such have a representative form of government. The source of authority and control is the owners —the shareholders; they elect a board of directors to conduct the operations of the bank, and the board of directors delegates authority to certain officers, appointed and controlled by them, to execute their will and policy. Certain powers are inherent and inalienable with the shareholders, certain ones with the directors, and certain others with the individual officers.
The officers common to all commercial banks are the presi dent, one or more vice-presidents, the cashier, and one or more assistant cashiers. But with the expansion of business a number of the larger banks have found it necessary to have additional officers. Ordinarily the president is the chairman of the board of directors, but in certain large banks these offices have been dis tinguished from one another. A bank finding the number of its vice-presidents unduly expanding may designate several of its senior vice-presidents "executive managers," over whom one may be appointed "general executive manager." The duties devolv ing upon the president may be so great as to require an assistant to the president, and the duties devolving upon the vice-presi dents may require assistant vice-presidents. The cashier has an increasing number of assistant cashiers, some of whom may di rectly assist certain vice-presidents, and others may specialize in certain lines of activities and may also continue to manage the department from which they were elevated to assistant cashier ships. Another officer appearing in bank administration is the comptroller. Although his position is not yet standardized, he generally divides the executive work of the bank with the cashier, handling the personnel, auditing, planning, etc.
The above officers constitute the management of the bank. Except the inherent and inalienable powers and liabilities of certain officers, the powers and liabilities of the officers in general are determined by delegation by the hoard of directors. The
great object in view is to concentrate authority and responsibility and at the same time empower the subordinates with enough authority to execute business expeditiously. The larger the bank, the more persons have to be given authority to sign for and bind the bank, and the more difficult become the delegation and supervision of this authority. In the pages following are given the legal and other qualifications of the shareholders, directors, president, and cashier, together with their legal authorities and liabilities, as recognized in courts of law. The powers and liabilities of the other employees are comprised within those of these officers, and it is not necessary or possible to state them in detail.
The Shareholders of National Banks The shares of national banks, with a few exceptions, are of Stoo par value, and the minimum capitalization is based upon the population of the domiciling city or town. There is no limit to the number of shares owned except as results indirectly from limitations on the number of incorporators. On March 5, 1917, there were 7,581 national banks, with a combined capital of $1,073,875,000, and a total number of shareholders of 459,619, of whom 138,204 were women. This is an average capitalization of $141,654, and an average ownership of about 24 shares to a stockholder. Bank shares are widely held, particularly those of country banks, which are owned by local capitalists. The growth of capitalization of national banks in its relation to certain prin cipal items is indicated on the following chart for quinquennial periods: The fall in capitalization per bank after 1900 was due to the Act of 1900, which permitted national banks to organize with smaller capital; but this act also tended to cause a wider owner ship of bank stocks. The average capitalization of state banks is smaller than of national banks. Their shares, however, are also widely held.