WASHINGTON -- Banks began to reopen for normal business today with a pledge to the nation from President Roosevelt that "we will not have another epidemic of bank failures."
Banks licensed by the treasury were permitted to open today in the 12 key financiels centers -- the cities in which federal reserve banks are located. Tomorrow and Wednesday the reopenings will be extended throughout the country.
President Roosevelt in a public statement calling upon the nation to "unite in banishing fear," promised that the reopened banks "will meet all needs."
The lid remains clamped tight on release of funds for hoarding. By order of Secretary of Treasury Wood in, withdrawals of deposits are limited to the funds needed for normal business and necessary personal expenditures.
Cites Banks' Duties
"The first duty of banks reopening under the license of the secretary of the treasury for the performance of their usual functions is to see that the primary needs of the people for the necessaries of life and normal undertakings are, Woodin announced.
"Accordingly withdrawals for hoarding have been prohibited and the secretary of the treasury rules that until more normal conditions have been established, transfers of funds by banks or, their customers will be limited to necessary purposes."
New York, Boston, Philadelphia, Atlanta, Richmond, St. Louis, Kansas City, Dallas, Cleveland, Chicago, Minneapolis and San Francisco are the 12cities in which licensed banks were; permitted to resume business today. Treasury and federal reserve officials passed on the fitness of federal reserve member banks in these cities to reopen. State authorities were certifying state banks.
Private banks such as J. P. Morgan & Co., which are not members of the reserve system or under the immediate supervision of any state authority, also were permitted to reopen today, unless prohibited by state restrictions.
Secretary Woodin further authorized the following institutions to reopen this morning: All federal reserve banks and their branches, federal land banks, federal intermediate credit banks, joint stock land banks, federal home loan banks, region agricultural credit corporations, and the Reconstruction Finance Corporation.
Tuesday certified banks in about 250 cities in which there are or ganized clearing houses may re sume business. On Wednesday banks in all other cities and towns will reopen as fast as federal and state officials certify their sound ness and relax present state restrictions.
The reopening was placed on this gradual basis to afford ample time tor distribution of the new federal reserve bank notes which the bureau of engraving here is turning cut at the rate of $30,000,000 a day. It also gives the 10,000 state banks which are not members of the federal reserve system more time to join the system or obtain ample funds from member banks and other agencies.
"I know that many people are worrying about state banks not . members of the federal reserve system," President Roosevelt said. "These banks can and will receive assistance from member banks and from the Reconstruction Fiance Corporation.
"These state banks are follow ing the same course as the national banks except that they get their licenses to resume business from the state authorities, and these au-tohrities have been asked by the secretary of the treasury to permit their good banks to open up on the same schedule as the national banks. I am confident that the state banking departments will be as careful as the national government in the policy relating to the opening of banks and will follow the same broad policy.
Mr. Roosevelt again emphasized that "if your bank does not open pontiff obtain even the was president first the first day, you are by no means justified in believing that it will not open. A bank that opens on one of the subsequent days is in exactly the same status as the bank that opens tomorrow."
"I do not promise you that every bank will be reopened or that individual losses will not be suffered," the president continued. 'But there will be no losses that possibly could be avoided; and there would have been more and greater losses had we continued to drift.
"I can promise you salvation for some at least of the sorely-pressed banks. We shall be engaged not merely in reopening sound banks, but in the creation of sound banks through reorganization."
Mr. Roosevelt thanked the people for the courage they displayed during the financial crisis, but warned they "must not be stampeded by rumors or guesses."
"Let us unite in banishing fear," he pleaded. "We have provided the machinery to restore our financial system; it is up to you to support and make it work.
Explaining the situation which made it necessary for him to declare the banking holiday. Mr Roosevelt said:
"We had a bad banking situation.Some of our bankers had shown themselves either incompetent or dishonest in their handling of the people's funds. They had used money entrusted to them speculation and unwise loans.