14652. Bank of Rochester (Rochester, NY)

Article Text

of the Safety Fund banks might simply oured by the Ryment annually into the Trea. sun equal to hair of one per cent on the capi be the invest this to life sum of charter the during ions added to the fund. and held State trustee for the bill holder tion to this, security might be exacte d for the punc. the the the payment of on per centage delivery circulating notes to the officers of the bank. and such would eff atually protect the bill holder as sociated banks. Assembly Dec No. 25. of 1846 pages securi y now is only given for the redemption of the circulating notes. and not for the debts of the bank generally, as was required by the Bank Fund law of 1829 the halt per cent might be exacted only on the amount of notes issued by the Comptroller to each bank The cent charter for should per allowing beten exaction twenty years and this on $150,000 the amount issued by a bank of $100,000. would be $15,000 The necessity its of paying this sum into the Treasury. or securing payment and placing it beyond the reach of the banker would some extent counteract the prevalent tendency to establish banks at points where there no business requiring banking facilities. The Constitution only quires security for the redemption of circulating notes and seems to be entirely equitable that each bank sould contribute to the fund in proportion to the notes issued and used for its benefi Each free bank is he to the came rule, by being required to give security in exact proportion to the amount of notes which it puts circulation. With paid up capital and ten per cent on the notes secured to the Safety Fund. to be held and husbanded as before suggested, it 18 believed that the currency would be amply secured, as contemp lated by the Constitution This mode of contributing to common fund to provide the means for redeeming the notes issued by any one of the contributia banks which might become solvent would require the assent of each of the associate banks. as is not fairly inferrable that the constitution intended to force one bank to furnish means for securing notes issued by anoth her. unless by the assent of the corassociates All each of banks. or porators bank existing therefore. ought to have the option of continuing under the proposed Safety Fund system of securing the which notes money issue State they depositing by stocks and bonds and mortgages,as provided in the general banking law PAR in of this State banks unblished class the system free banking, not for the purpose of furnishing banking facilities to he business of the places where they are located but with view of putting the notes In circulation in New York par. and redeeming them discount half of one per cent. as provided by statate In the annual report of the Comptroller in 1844. 61 to 63) the attention of the Legislature called this subject, as an evil which was then mencing, and it was suggested that an effectual remedy would be found in requiring all the banks to redeem their notes at par in the city of New York This whole some reform in the currency has been defeated from year to year. by interests antegonist to sound currency attempt was made to reme the evil by requiring posite of fifty thousand dollars condition for the of this in sue of notes iciency nin individual en banks rent from the within the last year, with capitals $50 000 or more, and many of them points far of channe the business is from new have them, roads ening to almost every case the notes of these banks secured slocks of State of New York that the notes would half cent better the death of the bank than during its life The opponents of par redemptions complain of the in justice of compelli the banks to redeem at two places The practical effect would be redem tion at only one place. And then as to hardship the banks crowd dollars hands the int of the millions currency of of ty people. on which the stockholders are drawing more than million of dollars annually in interest. and instead of making the return which just ice demands, by redeemi their notes at point which would render them equivalent to gold and eilver. they are content to reap the ditional gains. on the discredit of their own promises, redeeming them at half of one per cent fair of that only is cent half one per to the banks for tting funds to to notes to York their that redeem be supposed the furni facilities banks have which pending for ducts to tide water of the value of seventy millions of dollars, will be subjected to incon sience expense in getting funds in New York to redeem their notes? 18:6, the annual report statements were presen which proved that those banks that kept their notes had circulation good Yo as New those as paria that redeemed at discount of half of one per cent When ample security, as quired by the constitu tion, shall have been provided for all the circulating notes. with conviction in the public mind that all bills registered and are amply secured. and at par with gold and silver in New ork, what is prevent the currency or this State from becoming. If national currency, at least favorite medium in that vast region of country at the west. which contributes so large portion to our ornal revenues, and looks to New York for market its products? BANK The 6th Fection of the act abolish the office of Bank Commissioner and for other purposes, passed April 18th. 1843 provides that shall be competent whenever shall and he have for the Comptroller, good sufficient reasons to suspect the condition of any bank a the correctness of its quarterly report to appoint affairs the special examine bank. and of agent such to who for that purpose shall have the same powers now missioner Bank vested law in a by The authority given to the Comptrol in this reference the exercised tion. follow. to has been in five banks. The Bank Trust ing and Company 1845 Bank Rochester of January the in September 1845; the Lewis County Bank in May, 1846 and in Os tober Canal the of Bank 1847: Lockport, in august, 1846 and the Bank of in June. In the case of the Lockport Bank and Trust Compa Thomas Burt. E.g. was appointed special the and commenced examination the bank on of of January. 1845 his By report that appeared affairs of the bank were in very condition. and that immediately after refusal of its notes the agency in Albany and before his arrival bank nearly the whole of assets which were consid were ered of value. secure certain to any assigned ditors other than the bill holders There had. howeve been previously assigned to the agency in this city, $116.701. the recure to of of to sets amount the payment its a the due of large circulating sum for redemption of bilities notes was the Amongst lia bank the 87. amount to the $36,944 to the of canal Fund, for canal tolls deposited by the collector that place. The special agent reported that this debt ot the bank was less adequately secured than any other, to secure the payment of which the assignments had been made was the opinion of the then Attorney General, that the bank preseesed the legal authority a execute these no tion and cons made quently was applies for an injunction. Soon after the report of the pecial agent was received the officers of the bank made rangements for the rede mption of its notes, and the its sociation The still continues operations banking debt due to the Canal Fund has been reduced to the sum $31.072 of the case of the Bank of Rochester application made for an vestigation in behalf of the officers of the bank and some of the principal stockholder Stebbins was special and Charles agent entered on the tamination on the 11th of Sept 1845 with first 1824. This in of bank capital $250.000 In May 1845. the charter was extended olders assented stockho provided the to two years personally liable for the debts of the bank and that to contributor Fund should also the become Safety a A portion of the stockholders protested against incur ring the liability; and it was determined to wind up the bank The special agent reports a loss of about $100 000 of the capital, but also reports that it possesses the to discharge all its liabilities to the public, and that he has not discovered that the said banking on it. binding of law The has provision violated any agent therefore did not deem it necessary to proceedings in chancery and the directors have allowed to proceed in winding up he affairs of the bank reports an that The of item further, special agent $40,821 50 charged in the statement to suspense count, represents nothing of value. but consists of an amount of notes of the bank which have been redeemed from time time, and which appear to have been some time fraudent) issued by or abstracted from the 200 time that since discovered, some bank im WAS pressions of $25 plate $5 000) had been put into the books enteres which culati. of on not were bank the debit of the cash account The amount is entered to the debit of suspense account and forms part of that item in the statement How these into circulation isas unascertained mere would hardly seem possible have been neglect to enter their issue upon the books. as in that case the cash must have exceeded the cash account by that amount, and of this there is no evidence. al. most equally difficult to account for the fact in any other way, the integrity of all the officers employed in the being The balance of the bank