All coupons sent to the bank by foreign clients for collection are received by the foreign securities department, and are checked to see that their number is correct and that the proper United States income tax certificate is attached. Their receipt is then entered in a coupon book, after which they are turned over to the domestic coupon collection department for collection. When advice of payment is received, the entry in the book is stamped out and the proper account is credited and advised. The domes tic customers' securities department detaches and tenders to the coupon collection department for collection all coupons on bonds belonging to foreign clients. When the coupons are collected, an advice of payment is sent to the foreign customers' securities department, which makes entries and advises the clients. The coupon book has columns to record the date of the letter remitting the coupons for collection, the name of the account, the name of the coupon, the dollar amount of the coupon, the signature of the coupon collection department, and the stamp-out or remarks.
The foreign securities department is also responsible for the proper handling of all income tax matters in connection with the bank's foreign clients. When collections of foreign dividends are made abroad, the department sees that the proper income tax certificate is received and later sent to the Collector of Internal Revenue. By government regulation the nominee or the cus todian of stocks and bonds is responsible for the filing of all income tax returns for income received from sources in the United States by non-resident aliens.
New Foreign Accounts Department Some banks organize a special department to procure new accounts and to keep the old customers of the bank favorably disposed toward the institution. The general duties of such a department are to solicit and accept new accounts of persons or firms living abroad, to open the new accounts, to inform and to keep the client informed as to the terms and conditions upon which the account is opened and continued, to keep the client supplied with check books and other necessary supplies, to re ceive and interview customers or their representatives visiting the bank, to handle the correspondence connected with the foreign accounts such as complaints, inquiries, etc., to ascertain the cause of the closing of an account, and to seek to maintain and extend the good-will of the bank among its foreign customers.
Such a department is in a position to create and maintain good-will for the bank, as well as to perform useful services for present and prospective customers. The handling of disgruntled customers with tact and diplomacy, each in the language and according to the customs of his country, requires no small de gree of ability. Correspondence with new and old customers must be couched in diplomatic language, and the personal visit of the foreign client or his representative to the bank must be made agreeable and attractive. To anticipate the client's needs for
supplies is the surest way to provide against complaint.
The department is very intimately related to the officers of the bank who are responsible for the conduct of the bank's affairs abroad. The procurement of new accounts in the Caribbean region, for instance, and their care after they have been procured are of direct concern to the officer who handles the Caribbean affairs. In fact, the department relieves the officers of much detail and correspondence relative to the opening of new ac counts, and the members of the department keep in constant touch with the officers for their information, advice, and direc tion. In the organization and development of any bank's foreign division such a department can unify effort, work out the best and most feasible plans, give an undivided attention to getting and nursing new accounts, and in the light of comparative re sults improve the bank's methods and campaign to develop its foreign business.
Soliciting and Opening New Accounts Practices differ in the soliciting of foreign accounts. Some banks are aggressive, sending traveling representatives into the field, or mailing circulars to solicit trial accounts of desirable parties, or establishing foreign branches from which their pub licity and services radiate. Other banks are passive and do not seek new accounts. Others, again, may take an intermediate course and merely follow up any foreigner for whom they may have performed a service or with whom they may have had busi ness dealings. In the near future the tendency of banks will un doubtedly be to push more aggressively their commercial and financial penetration of foreign countries, and active campaigns for accounts will become as common abroad as in the domestic field. As yet, American banks are just formulating their policies in these matters.
Whether or not an account is acceptable to the bank depends upon circumstances. When, for instance, an application is made • by letter or personal visit, or by another party (possibly by an other customer, at home or abroad) the question at once arises as to whether the bank has ever done any business for or with the applicant, whether it has credit information in its credit files about the prospective client, etc. For illustration, suppose a foreign client asks the bank by letter or cable to place certain funds to the credit of another foreigner who has no account with the bank. A clerk at once begins an investigation to learn whether the bank has ever had any business with the prospective client. He canvasses the files of the credit department and the dossier of his own department and possibly of other departments, such as the letter of credit department, and he has the signatures on the letter verified in the signature department, or the tele gram authenticated by the cable department or approved by the officer in general charge of this area.