10528. Bank of Newbern (Newbern, NC)

Bank Information

Episode Type
Suspension → Reopening
Bank Type
state
Start Date
June 4, 1819
Location
Newbern, North Carolina (35.108, -77.044)

Metadata

Model
gpt-5-mini
Short Digest
8cee21f8cf89fbf2

Response Measures

None

Description

Multiple articles (1819) report that the State Bank, Bank of Cape Fear and the Bank of Newbern resolved to refuse specie payments (effectively suspending specie payment) in early June 1819 due to repeated heavy specie demands by brokers/speculators and depressed local agricultural prices. Later material (1903 retrospective) notes specie payments were resumed by 1828, and the charter expired in 1820, consistent with a suspension followed by eventual resumption. OCR of Newbern appears as Newberu/Newbern in sources; corrected to Newbern (NC).

Events (2)
1. June 4, 1819 Suspension
Cause Details
Banks resolved to refuse specie payments to brokers/speculators who purchased notes at a discount and presented them for specie amid heavy withdrawals and depressed agricultural prices.
Newspaper Excerpt
RALEIGH June 4.-A meeting ... the State Bank of North Carolina, the Bank of Cape Fear and the Bank of Newbern ... refuse to pay specie to Brokers, or to others who they believe have obtained their notes by purchase at a discount for the purpose of obtaining specie from the Banks.
Source
newspapers
2. January 1, 1828* Other
Newspaper Excerpt
Specie payment was resumed in ... 1828 the banks did ... meet the demands placed upon them. ... they succeeded only fairly well ... until 1828 the banks did their meet the demands placed upon them; they succeeded only fairly well ... Specie payment was resumed in 1828 (retrospective account).
Source
newspapers

Newspaper Articles (5)
1. June 8, 1819 Richmond Enquirer Richmond, VA
Article from Richmond Enquirer, June 8, 1819

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Article Text

which we had paid two out of three instalments, will in many cases not be sufficient to pay the very last instalment. ECONOMICUS. myleext. I shallanswer the sense of the Aurora. Its editor is a metepic tender to Political Economy, whoches not 1783derstand the most simple principles of the sei, ence.-1 shall seize the sanie opportunity of remarking on an authority that deserves respect-the last Edinbare Review ou the priu cipies of the value of money." Epitaph on the tomb of the Spanish Curalier. I was well-1 wished to be better-1 took physic-and here am Such is the inscription that snits this country in these times-The Bank paper is the kilded A. pill that has brought us where we are. The gentleman, who broughtthe information from North Carolina, which was given in some of the first impressions of our last paper, is now in thiscity. It appear- that the North Caro. lina state Bank at Raleigh refused to give the broker from this city specie for about $ 15,000 fits paper; but tendered him a draft on the North-that the brauchat Fayetfeville declared it would be protested secner than pay him specie for about $ 5000, but tendered him a draft on New York, which he accepted. The North Carolina newspapers have since coure to hand, from which learn that the Cashiers of the different banks have come to the follow. ing resolution: RALEIGH June 4.-Ameeting at Favettsville on the 31st ult of delegates from the State Bank of North Carolina, the Bank of Cape Fear and the Bank of Newbern. charged by the respective institutions, to take into cousideration the present state of the country as it effects the business of the Banks, and to report whether any measures are proper on the part of the Banks. The committee having considered that the repeated heavy runs for specie made by Brokers and others, who by disingenuous means depreciate the notes of the Banks of the State, then purchase them and present them for payment in specie which was held by the Bankskeeing NO reason to hope that such runs will be discontinued while the calls are met by specie payments, and the advance price of specie added to the discount of the purchase , enders the operations profitable: Believing that the reduced value of the agricultural produce of the country, and the losses of thener. chants of this state, consequent on the mexpected and great fall in value of produce and the failures of merchants in other states, retider it impossible for the citizens of this state to pay their debts to the Banks at the present period: And convinced that attempts to enforce the collection of the debts due the banks by suit and execution, would result only in the sacrifice of festates and in the min of thensands: The committee are compelled to conclude that the Banks of this statemust choose between the alternatives of enforcing the collection of the debtsdire their, regardless of the rnin and distressti course occasion; of continuing to pay specie to special tors 1111 til their eimptied vaultsshall compel them to dishonour the notes: or to refuse to reteem with specie, their notes presented by speculators. The choice between these alternatives is painful: The one course may effect the credit of the Banks-the other will certainly overwhelm a community with misery and ruin. The committee anxiously weighing the dufficuities of either course, believing that a suspension of payment of specie to those who have obtained their notes for speculation, will be productive of much less general injury than the other alternative. agree to the following resolution. That the State Bank of North Carolina, the Bank of Cape Fear and the Bank of Newbern, (while the present state of things continues) refuse to pay specie to Bro. kers, or 10 others who they believe have ob. tained their notes by purchase at a discount for the purpose of obtaining specie from the Banks 7 We learn that the delegates have agreed to recommend to their respective Banks to permit debtors to renew notes on the payment of only the interest, which we presuine will be adopted IMAGINARY LAW CASE. We were amnsed some weeks ago, by reading in the Wilmington paper the statement of a law case between a Bank and one of its debt. 013 Contrary to our expectation, however, find that by many the decision there mile. gined is actually supposed to have been had. It is. therefore. our duty to say, that the case published was merely hypothetical. That Bank notes. payable to bearer. on demand, but never presented at the Bank for payment, should be considered as an offset, in a spit, and thereby throw the cost on the Bank would never enter into the mind of any man ID the least versed in law. common mercantile information or common sense. Nor is it to be supposed that any one would be willing to let his note remain upon interest and hold the money that would pay it off, losing the interest thereon. Nothi g but merriment could have been intended by the writer or publisher. if Star.

2. June 11, 1819 Richmond Enquirer Richmond, VA
Article from Richmond Enquirer, June 11, 1819

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be the Brokers of that city. it will be come to this pass in Petersburg, [Int. time to " shout up shop." N. C. Banks suspended Specie Payments The Fayetteville, N. Observer office 3. linst. contains following: We learn that a meeting of Delegates from the State Bank, the Bank of Cape on Fear, the Bank of Newbern, held here the 31st ull. to take into consideration coul- the present distressed situation of the deteras it affects the Banks, have Brotry, mined to refuse specie payments to notes kers and other speculating in their And for the purpose of drawing specie. will enaalsolearn that this measure debtors we ble the Banks to exact from their of notes." only the interest on the renewal The State Bank of North Carolina, and two other Banks in that State, have, the determined to make an experi- by it appears, recommended some time ago writers ment, in this District, but thought too hazardous to be attempted here : that pre- is, refuse specie for their Notes under when such sented to tosuchan amount, and to have circumstances, as indicate them disbought up out of the state, at a of been and collected for the purpose step, count, drawing out specie. This is a held least this untried ground. It has at on should it have a good effect, it em- it merit be ; persisted in but, should banks, it barrass may the operations of the their be easy for them to retrace measure will We believe that the considecourse. been adopted on abstract the has and not forced on the banks, rations, Bank particularly. by necessity.- of State though it be true that the paper cirFor, State Bank has a more extensive Bank in the than that of any other it culation Union in proportion to its capital, than the true, that it has more specie notwithis also other ; and thai, we almost any the runs on the Bank, recently as standing informed by a gentleman formed are that state, the specie, which Bank, yet from subscription to the in the original for the most part undisturbed remains in which it was first deposited predict, the boxes vaults of the bank. We or in the any hesitation, that the right North without in what they have done, to imitate [Nat. their example. Carolina wrong Banks will find many Int. Extract of a letter, dated Denbury, Albany. (Ohio.) May addressed to a gentleman in 6, thought it would be prudent to inform which I of some nohappy circumstances, our neighborhood, you recently occurred in any groundless have to save you from might create alarm, in order which common report a week, (April 26,) our about we received us. Last the Sunday, intelligence and that John TWO of Wood, neighbors, George little Bishop above the forks the III- of had been River, found cruelly a butchered herselves by and the river's was diaus. Portage We immediately armed mouth, where the inquest proceeded had 10 been brought An and on examining immediately bodies held over murdered willfally by them. found they were I dare say, in your but time, nepersons unknown. men sufficiently cut Bisliep up. alone, you have them. seen On the head tomabawk, of each of ver like six strokes of eyes run oui, &c. A page would net body. there which were let out the brain be sufficient his to give you a description of one the neighbourhood appear- alf day. " The Indians in and kept coming in services ed much alarmed, of them volunteered the their marderer A number us in pursuit of After we had buto go o with of them we accepted. a conneil among our- all some ried the bodies, agreed we held that we would them parade what our selves the Indians. and and express The duty to of addressing interdetermination performed was. by me, through them our an delerthem which I set forth to at all hazards -our mination preter, ample in to have the abilities murderers o take their duty them, to wherever have At- bad they to prevent future bold and terprising Indians ter I were--and had cut finished, off it Sasa, was with a young, the other crimes. Indians, great en- his chief, with (who extreme attention That he, and with never solemnity,) had listened said, in answer: the bad Indians, the or white would find thankful that would again: he was guilty and they men did not conduct. that our We party, show return by their think misplaced." them confidence two organized, other in them was not Tapper and early them muder a Mr. on Monday morning to whom white men, and They left theirsquaws returned home, they started. rations. We then require. 10 we act issued Wednesday. as circamstand an express would came with 10 many us, with of On report that the murderers. had assembled hideous the tribe, Pottowattamies.) murder. with gottogetheir the place of the We immediately Away we shrieks, I was chosen to encampedat orrather in the morning near ther marched and yells, &c. command. Brairies,and westarted Portage, after sumset. Early marshesand (30 miles.) forded rivers.creeks.n Toupoint before noon this river, we three met crossed About two Topper miles and beyond his These party, had with inken the them be murderers met prisoners. their chiefs two river-so nights by the consent forks of of the Miami midnight TII fore. near them the in their settlement camp about of that power. their We prized the midst of a large travelled back with and all overwere strength, ful tribe, for and fear of being still among pursued them and in to powered. danger of a reseue ordered our refreshments marched I accordingly and in 15 minutes reached we Portage be given Before them, next dark, day we at 1 o'clock, we city, deli- to again. again vered them and at the The same Portland, night or Sandusky a legal who examina- made the sheriff. tion rull contession of the prisoners of secreted the took marder. the place, plunder. have They returned also A party told with it. where they had to find it, who the 18th of this will was dispatched Our circuit undoubtedly sits condemn the month, to be and hang. they ⑉ the annals of the and U States capture an lated. instance of Indian of Our marderers, friendly as Indians receiv ed handThere is not such a rapid pursuit. the one I have now

3. June 11, 1819 Richmond Enquirer Richmond, VA
Article from Richmond Enquirer, June 11, 1819

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# NORTH CAROLINA BANKS. PETERSBURG, June 8.-Upon the information of a gentleman from Raleigh, in our last paper, we contradicted the report in circulation, that the Banks of N. Carolina had suspended the payment of Specie for their Notes. It seems our informant was mistaken. The following articles which appear in the Carolina papers received by the last mails, shew that the State Bank, the Banks of Cape Fear and Newberu, have actually resolved upon this measure. We shall not undertake to arraign the Carolina Banks for this proceeding-if in it they have done any thing unlawful-any thing contrary to their charters-why, it is a question between those Banks and the legislature of North Carolina. But it is a measure, whose operation will undoubtedly be more sensibly felt in this part of Virginia, than in any portion of that State. The Carolina notes constitute, almost entirely our circulating medium. The merchants of Petersburg receive them at par for their goods; and having their payments, to make through our town Banks, are compelled to pass them off at a discount for such money as will be received. The difference in six months has augmented

4. July 19, 1837 Cheraw Gazette Cheraw, SC
Article from Cheraw Gazette, July 19, 1837

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CHERAW GAZETTE WHENESDAY. JULY, 10. 1837. Triumaph of Order.-We have copied, at length, from the Charleston Courier, the article under this head. giving an account cf an attempt by a man professing to be a Minister of the Gospet of peace, to get up an excitement, and perhaps a riot against the Banks in that city. The result must make every intelligent and virtuous Carolinian still more proud of the Southern character. We fully agree with the Courier in the opinion that the institution of slavery, (we are not squeamish about the use of the term,) exempts our Southere cities from the dangers of agrarian mobs, to which cities, and owns at the North, and in some parts of Europe, are SO much exposed. From the very nature of the case, it must be that the number of vicious and degraded vagabonds will be less in a slaveholding community than in any other, so long as human nature and the institutions of society continue what they are. Persons holding notes on the old State Bank of N. Carolina. and the Bank of Newbern, are cautioned against retaining them. They will now be received, we undersand, in payment of taxes in that state. But after the first Monday in November. the Banks will be extinct, and the funds divided among the stockholders, so that bills not redeemed before that time can never be redeemed, and will of course be an entire loss to the holders. The extra session of the Legislature of Alabama has adjourned, after passing what is called a relief law. It sanctions the suspension of specie payments by the Banks till the 15th June, 1840; provided they will grant indulgence to their debtors as follows, viz: for 25 per cent on the amount due for one year, 371 per cent. two years, and 373 per cent. three years; and provided also that if the Bank of Alabama shall resume specie payments earlier, the other banks shall also do so, or forfeit their charters. The Legislature has also authorised the emission of $5,000,000 of State bonds, to bear an interest of 6 per cent. per annum, redeemable at the pleasure of the State, after two, four and six years; to be sold, not under par, for specie or its equivalent; to be divided among the branches of the State Bank; one half of the share of each bank to be deposited in N. York as a specie fund, subject to the drafts of the bank. The Bunksarealseauthorisedto issue small bills. A number of other bills were passed, among which is one to divorce a discontented pair, and to authorize the citizens of Cahawba to elect a Constable.

5. June 28, 1903 The News & Observer Raleigh, NC
Article from The News & Observer, June 28, 1903

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volume of paper currency from larger. The banks continued to November. 1818, the proportio the notes in circulation and in the State Bank of North was over eleven and a half to every dollar in the vaults o there was in circulation be and $12 of paper. For the pu stemming the tide which was overwhelm the institution, the dir the books to be opened for riptions to the amount of $424,000. remained unsubscribed. In ord crease their circulating debt. the allowed these subscriptions in the notes of the bank. th alling in $424,000 of their outsta currency. Before all the in had been paid in, however, i that the scheme would not of saving the bank. that it npossible to keep sufficient spec the constant demand for redem in June, 1819, delegates from all the banks, the Cape Fear. New State Bank, met at Fayetteville tered into a formal resolution to specie payment. Their notes fell to 15 per cent below par The sentiment of the people and feet in business circles occasione action of the banks are evidenc following report of a legislative "The depreciation of the no the banks caused by the refusal o to make good their notes has been productive of inca mischief to the community: and insiderable aggravation of the mi know that in the case of the large quantities of their notes casionally been thrown into circul themselves in the purchase of e nother remarkable fact is that to themselves from demands for 8 at one time administered an each individual presenting their specie compelling him to state th not a broker." The general condition of the fin the country, the lack of confiden people, and the scarcity of gole made the existence of the ba nstant struggle. In 1820 the chart Bank of New Bern expired and w artered. as was that of the Bar Fear in 1822. These two bank ther with the State Bank of North and their separáte branches cont the only financial institutions it until 1835. Specie payment was resumed in until 1828 the banks did their meet the demands placed upon they succeeded only fairly wel readily imagined from the system Private individuals were al become neavily indebted to them. in payment, or did not pay a 1828 the financial system seemed proaching a crisis, The affairs o were in a deplorable condition remedy was wanting. An attem part to force collection of their to: the general distréss, and in General Assembly appointed mmissioners, the Governor, Compt Secretary of State, to attend eetings of the bank and prevent, i a too rapid reduction of the any movement to wind up the a the bank too suddenly. These mimissioners were also authorized 1 a consolidation of the three h was unsuccessful. The commi succeeded in making matters easi omising to recommend to the Ge