116 
POSTAL SAVINGS 
vetoed and in the veto message. This amend 
ment, which is the present law, provides that 
“if one or more member banks of the Federal 
reserve system . . . exists in the city, town, vil 
lage, or locality where the postal savings deposits 
are made, such deposits shall be placed in such 
qualified member banks substantially in propor 
tion to the capital and surplus of each such bank, 
but if such member banks fail to qualify to re 
ceive such deposits, then any other bank located 
therein may . . . qualify and receive the same.” 17 
In this connection it is interesting to note that 
the proportion of the depositories which were 
national banks was not very much greater on 
June 30, 1916, than on June 30, 1914, before the 
Federal Reserve act went into effect, the respec 
tive percentages being 63 and 54. 
The first two years experience with depository 
banks taught some lessons which in the reorgani 
zation of 1913 led to certain administrative 
changes. The most important of these were the 
abolishment of the cumbersome system of 
“emergency credits” and the creation of a more 
efficient method of handling “out of town ac 
counts.” 
17 The law as thus amended (sec. 2) has been interpreted 
by the counsel of the Federal Reserve Board. See Federal 
Reserve Bulletin, July 1, 1916, pp. 331-332.