Deposit (finance)

“ But if a bank can employ all its capital, it is obvious that it cannot employ all deposits in making loans, because occasions are always occurring for removing deposits, as well as making them. Business men, for example, day by day, deposit with their bankers the checks or sums of money which they receive in the course of their business; and, on the other hand, day by day, draw out such sums as they require for the payment of purchases of goods, wages, rent, and other expenditure. A bank, therefore, while continually receiving deposits, is continually repaying deposits ”

“ Economy of Redemption Money.—It is thus evident that the employment of $200,000 cash as a banking reserve has made possible the existence of a more than sixfold volume of circulating medium—currency. Against each $1,000 of deposit liability there need be only $150 of actual cash. The bank customer, however, thinks of his deposit claim as money, and it really serves him all the purposes of money. The right to have the money when desired is as good as the actual money, is more convenient, and is as readily and as serviceably transferred. ”

“ When a person has £200 to the credit of his deposit account, he cannot make any further addition thereto, but the Post Office will invest this sum, or any part of it, for the depositor in Government Stock, and he can then continue paying in money to his account as before until the sum again reaches £200. ”

“ As a general rule, in the absence of an agreement to the contrary, a deposit, not made specifically applicable to some other purpose, may be applied by the bank in payment of the indebtedness of the depositor. ”

“ Where the deposit is general and there is no special agreement proved, it is doubtless true that the title of the money deposited in a bank passes to the bank, and the bank becomes liable to the depositor for the amount as a debt. ”

“ Deposit is also used in the sense of earnest or security for the performance of a contract. In the law of mortgage the deposit of title-deeds is usual as a security for the repayment of money advanced. Such a deposit operates as an equitable mortgage. In the law of contract, deposit or simple bailment is delivery or bailment of goods in trust to be kept without recompense, and redelivered on demand (see Bailment) . ”

“ All deposits made with bankers may be divided into two classes, namely, those in which the bank becomes bailee of the depositor, the title to the thing deposited remaining with the latter; and that other kind of deposit of money peculiar to banking business, in which the depositor, for his own convenience, parts with the title to his money, and loans it to the banker, and the latter, in consideration of the loan of the money, and the right to use it for his own profit, agrees to refund the same amount, or any part thereof, on demand. ”

“ If the person to whom the notes are thus paid by the borrower has himself no purchase to pay for, or no payment to make, he may, the moment he gets them, return them to the bank that issued them, to lie there on deposit. ”

“ The difference between a loan and a deposit is that a loan is in respect of goods transferred for the use of the person to whom they are transferred, whereas a deposit is for the benefit of the depositor. ”

“ If the sellers of the securities were customers, the banks would make payment by crediting the customers' transaction accounts, deposit liabilities would rise just as if loans had been made. More likely, these banks would purchase the securities through dealers, paying for them with checks on themselves or on their reserve accounts. ”

“ Banks of deposit, as has been mentioned, make loans from their capital and deposits. If from capital, the banker has no greater profit by the transaction than if he had lent out his money in any other way, equally safe, and involving the same amount of trouble. If from deposits, the interest he receives, so far as it exceeds the interest, if any, paid to the depositors, and a ratable proportion of the expense of carrying; on the business of the bank, is pure gain to him. ”

“ This fixing can be arranged in such a way, that in the event of the whole transactions exceeding an agreed maximum sum the guarantee deposit is to be increased.
§ 6.
The rate of interest for deposits in the Orders' (Cheque and Clearing) service cannot rise higher than two per cent per annum. ”

“ Provided that no interest earned on any such deposit shall be paid to the proprietor concerned except in accordance with the provisions of sub-section (3) .
[Sub-s. (2) amended by s. 2 (b) of Act No. 2 of 1972.] (3) Subject to the provisions of sub-section (4) , interest earned on any amount so deposited shall be paid to the proprietor concerned at the expiration of each full period of five years from the date of deposit and whenever such amount may be refunded to the depositor. ”

“ The modern deposit grew out of the older form of deposit in which the fund was held separate and intact, and the sole purpose of the deposit was safe-keeping. Safe-keeping is still a very important function of deposit banking; and from the point of view of most depositors the chief one. [15] Borrowing by a bank (as distinguished from a rediscount) is commonly regarded as evidence ofweakness. [16] Often the loan is made in the hope of averting insolvency. Loans made by one bank to another commonly involve a pledge of assets, since only upon such a condition is the transaction possible. ”

“ This charge the court gave, adding, 'If it was handed in as a deposit, it became a deposit at the time it was received. Taking the surrounding circumstances into consideration, if it was received by the teller as a deposit, it became a deposit. That I give you, for it has these words in it, 'or received as a deposit."
For most purposes the law regards the entire day as an indivisible unit. But when the priority of one legal right over another, depending upon the order of events occurring on the same day, is involved, this rule is necessarily departed from. ”

“ A certificate of deposit is a subsisting chose in action and represents the fund it describes, as in cases of notes, bonds, and other securities, so that a delivery of it, as a gift, constitutes an equitable assignment of the money for which it calls. ”

“ The only way, really, in which our system differs from yours is that every one starts the year with the same balance to his credit and that this credit is not transferable. As to requiring deposits before accounts are opened, we are necessarily quite as strict as your bankers were, only in our case the people, collectively, make the deposit for all at once. This collective deposit is made up of such provisions of different commodities and such installations for the various public services as are expected to be necessary. ”

“ We must not be misled by the fact that the cash assets may be less than the deposits. When the uninitiated first learn that the number of dollars which note holders and depositors have the right to draw out of a bank exceeds the number of dollars in the bank, they are apt to jump to the conclusion that there is nothing behind the notes or deposit liabilities. ”

“ A bank depositor, A, has not ordinarily "deposited money"; and whether he has or not, he certainly cannot properly say that he "has money in the bank." What he does have is the bank's promise to pay money on demand. The bank owes him money. When a private person owes money, the creditor never thinks of saying that he has it on deposit in the debtor's pocket.
§ 2 III.14 It cannot be too strongly emphasized that, in any balance sheet, the value of the liabilities rests on that of the assets. The deposits of a bank are no exception. ”

“ I therefore directed the treasurer of the United States: "Where deposits with national banks on account of subscriptions to the four per cent. loan have not been paid into the treasury within ninety days after the deposit was made, you will at once draw for the amount of such deposits, to be forthwith paid into the treasury, and as such deposits accrue under this rule, you will make such withdrawals until the whole is paid." ”

“ But the business of receiving money on deposit has always been, and is now, universally combined with that of lending it out. A banker does not hoard all the money deposited with him—he gives the greater portion out in loan. The lending of money is as much a part of his business as the receiving of deposits.”
You cannot go into a banker’s and say, “I{183} have come to open an account,” just as you would enter a grocer’s with, “Be so good as send me half a dozen tins of the best sardines.” ”

“ Presumably, therefore, moneys deposited by them were the proceeds of cattle consigned to them for sale. Their business being known to the bank, such presumption goes with their deposits; and, while not of itself notice, is a circumstance to compel inquiry on the part of the bank in respect to any particular deposit. We do not mean to be understood as implying that a bank receiving deposits from one whom it knows to be in the commission business receives every deposit in trust for any unknown principal. ”

“ Deposits payable only at an office of a bank located in a foreign country are not to be insured and are not to be counted in computing the total deposit liabilities of a bank as a basis for determining the amount of Class A stock to which it must subscribe. ”

“ If the amount realized from such emergency assessments shall be insufficient to pay off the depositors of all failed banks having valid claims against said depositors' guaranty fund, the state banking board shall issue and deliver to each depositor, having such unpaid deposit, a certificate of indebtedness for his unpaid deposit, bearing 6 per centum interest. ”

“ Persons depositing money only once, or very seldom, and intending to draw for the same at once, usually receive from the cashier a certificate of deposit, which states the name of the depositor, the sum deposited, and to whose order it is to be paid. ”

“ The seventeenth section gives power 'to receive money on deposit and pay away the same free of expense, discount bills of exchange and notes, with two or more good and sufficient names thereon, or secured by a deposit of bank or other public stock, and to make loans to citizens of the States in the nature of discount on real property, secured by mortgage,' &c. ”

“ It is not ordinarily bound to inquire whence the depositor received the moneys deposited, or what obligation such depositor is under to other parties. It is only when there gather around any deposit, or line of deposits, circumstances of a peculiar nature, which individualize that deposit or line of deposits, and inform the bank of peculiar facts of equitable cognizance, that it is debarred from treating the deposit as that of moneys belonging absolutely to the depositor. We notice, therefore, the peculiar circumstances which cast knowledge upon this bank, in respect to these deposits. ”

“ A depositor, as a rule, draws his interest twice a year. Some persons, however, leave their receipts from three to five years without disturbing them; and the bank-manager, always [54] anxious to swell the profits of his branch, is careful, when they are presented, to make his calculations at simple interest instead of at compound. Deposit customers, therefore, even when they do not require the interest due to them, should present their receipts six months after date in order to have the interest added to the principal, when both bear interest together. ”

“ The Comptroller's definition of 'deposits' should be honored here. For where the risk is on the customer that his cash and checks may never reach the bank, he cannot in good sense or in good law be deemed to have made a deposit while the funds are in transit. ”

“ Such corporations may receive on deposit, for the use and benefit of the depositors, all sums of money offered for that purpose, but recent legislation provides that they shall not hold of one depositor, other than a religious or charitable corporation, more than one thousand dollars at the same time. ”

“ The New York statute does not profess, however, to change the legal relation which results from a deposit made in a bank. The deposit of money by a customer with his banker is one of loan, with a superadded obligation that the money is to be paid when demanded by a check. ”

“ No Depositor is permitted to obtain, or cause to be obtained on his behalf, more than one deposit-book issued in his name; on the other hand every one is free, beyond their own deposit-books, to obtain for other, wholly distinct persons, deposit-books and to pay in deposits on their behalf. ”

“ The individual bank, of course, is not concerned as to the stages of expansion in which it may be participating. Inflows and outflows of deposits occur continuously. Any deposit received is new money, regardless of its ultimate source. But if bank policy is to make loans and investments equal to whatever reserves are in excess of legal requirements, the expansion process will be carried on. ”

“ The deposit is handed to the receiving teller of the bank, who, after verifying the ticket, makes an entry of the amount in the depositor’s pass-book. Duplicate deposit tickets are usually kept by the depositor. It is important to note that checks must be indorsed before they are deposited, so as to make them collectible by the bank. ”

“ The face of a cheque drawn to the amount of his deposit in favor of another depositor in the same bank is transferred in the banker's books from the credit of the drawer to that of the payee by the stroke of a pen, no money at all passes in the premises, while the banker is released from one debt by creating another of equal amount, the drawer is released from one debt by another to be transferred to the payee, and the payee is paid by the drawer by the former's receipt of another debt more acceptable to him. ”