If the banker resorts to the plan of refusing to accommodate his customers merely because his reserves have fallen below a desired limit, he has cut these customers off from credit which may be absolutely essential to their continuance in business. He has thus taken a step of very serious character and one which can hardly be warranted save under the absolute necessity of preserving the integrity of his own institution or of meeting the demand obligations which he has already outstanding. The banker's first duty, not merely to himself and his stockholders, but to the community, is that of keeping open his doors and meeting all demands upon him as presented. Everything else must be subordinated to this. It is a more or less secondary matter that the bank is thoroughly solvent and that the depositors will eventually be paid in full.

If the bank once closes, general confidence has been correspondingly impaired, and if the bank remains closed all of its depositors are deprived of the immediate use of funds upon which they have been relying to protect themselves. This may cause absolute disaster to them, especially if they are not able easily to open new banking connections, as they probably will not be. Therefore it is clear that there may be times when the absolute refusal of further credit by the banker in order to protect what is left of his reserve and enable him to meet the claims of depositors and others is essential. This, however, will be the unusual case, and indeed it is often true that the refusal of loans by a banker gives a perhaps unwarranted impression of weakness on his part, with the result of destroying confidence and starting "runs" which may wreck even a very strong and well-protected institution.