1284 New York State Agricultural Society 



rural credit banks. These systems are three in number, namely: 

 The Kaitleison, Schultze-Delitzch and Landschaften. 



The llaitt'eisou system of banks in Germany are small banks, 

 organized by small farmers in local communities, and the business 

 done is on loans granted upon the plan of unlimited liability, that 

 is to say, each loan to each individual member is guaranteed by 

 endorsement of all the members constituting the shareholders of 

 the bank. This system of banks in Germany last year did a busi- 

 ness exceeding one billion five hundred million dollars, without 

 losses, and an interest charge not exceeding 4 per cent. 



These small banks are not operated primarily for the purpose 

 of making big dividends or paying large salaries, but for the 

 purpose of maintaining a medium for financing the membership 

 of the institutions with ready capital when needed in the conduct 

 of their farming operations. 



The Schultze-Delitzsch system of banks is known as the popular 

 urban banks, and is operated somewhat after the fashion of our 

 present country banks, only the stockholders are much more 

 numerous, and the rate of interest does not exceed 4 per cent, 

 per annum. 



The Landschaften system of banks is under the direct control 

 and operation of the landowners of the various provinces where 

 they do business. 



These are the strongest and most poAverful rural banks iii the 

 whole of Europe, and under this plan the system of doing busi- 

 ness is substanrially the same as that of the American Merger or 

 Trust Corporation. 



A group of landowners in a county will organize into a league 

 or corporation. Tlioy merge their lands into a negotiable bond, 

 each unit in the bond representing the amount of land owned by 

 each individual member of the league. This bond is rendered by 

 law li(]uid and negotiable, 1)v reason of its b(>ing ample security 

 and perfectly safe for a loan of from 50 to 75 per cent, of the 

 fairly assessed value of the lands incorporated in the bond. These 

 bonds run for 20. ,30 and 40 years, and find ready sale in the 

 great money nuii'kots of Europe at from 3 to 4 per cent, per 

 annum. They are considered as safe as government bonds and 

 are as eagerly sought by investors. 



