Express Bank

Long has there been theoretical speculation on what would be the liability of American Express Co. stockholders should their company fail, for unlike almost all U. S. corporations, American Express was never incorporated, being a voluntary association (joint-stock company) formed in 1850. Chances of American Express failing have, however, become increasingly slim. In March its domestic express business was transferred to an agency controlled by the railways. In July, Chase National Bank and Chase Securities Co. secured practically all American Express stock.

Chief reason for Chase wishing to own American Express was that its business (done through 35 domestic, 65 foreign offices) amounted to international and interstate banking through the sale of money orders, drafts, travelers' checks, letters of credit, telegraphic and cable transfer of funds, collection of foreign bonds, coupons, legacies, the purchase and sale of foreign moneys.

Last week American Express announced it will form American Express Bank & Trust Co. with $10,000,000 capital. Although the new bank will be incorporated in New York, each American Express office will amount to a correspondent, and, should branch banking laws be repealed, could quickly become a branch. In this way Chase may some day have a nation-wide banking system without buying out-of-town banks or forming new ones.

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