Bank of the United States of Pennsylvania

Bank Information

Episode Type: Suspension → Closure
Bank Type: state
Start Date: February 1, 1838*
Location: Philadelphia, Pennsylvania (39.952, -75.164)

Metadata

Model: gpt-5-mini
Short Digest: 870a3130

Response Measures

None

Description

Articles (1841–1842) describe the institution as long under suspension (under suspension four years in Feb 1842), effectively bankrupt and prostrate with calls for liquidation. No discrete depositor run is described; the bank is portrayed as insolvent/corrupt and remaining suspended/failed. I inferred the suspension began ~1838 from the four years remark in the 1842 article; no explicit receiver assignment is stated in the snippets.

Events (2)

1. February 1, 1838* Suspension

Cause: Bank Specific Adverse Info
Cause Details: Longstanding misconduct, large questionable loans and misaccounted items leading to insolvency and suspension of specie payments; investigators recommend liquidation or relief legislation would be required to carry on business; bank described as bankrupt and prostrate in 1842.
Newspaper Excerpt: The bank has now been under suspension four years
Source: newspapers

2. February 15, 1842 Other

Newspaper Excerpt: an ackowledged bank rupt, with her paper selling at less than twenty-five cents to the dollar...The marble palace...is tenantless and deserted...Crushed by the weight of her own corruption. the Bank of the U. S. of Pennsylvania exists hereafter but To point a moral and adorn a tale.acknowledged bankrupt quoted in article (Indiana State Sentinel, 1842-02-15).
Source: newspapers

Newspaper Articles (3)

1. April 24, 1841 The Columbia Democrat Bloomsburg, PA

Article from The Columbia Democrat, April 24, 1841

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Article Text

actions for years, on the part of the officers, without the sanction of the Directors. An ex-officer had taken a loan of 500,000 of the Reading Railroad, in his individual capacity and the bank had afterwards assumed the responsibility. In the profit and loss account, an item in relation to bank notes, amounting to $400,000 was deemed by the Committee to be unsatisfactory. Another item of $600,000 had not been properly accounted for, and letters had been addressed to those of the ex-officers who were presumed to be in a condition to explain the mode in which the $600,000 had been expended-but no replies had yet been received. Notwithstanding this picture, and it is but right to say, that the Report throughout seemed to us to aim almost too exclusively at the ex-officers, with but little allusion to the ex-Directors, whose business it was to check and prevent erroneous transactions-the Committee arrived at the conclusion that there is still more than $15,000,000 of the original capital left to the stockholders, and that the shares are worth about $46 each. Several documents were read, and among them a letter from Mr. Cabot, of this city, vindicating his firm from any supposed improper agency in the cotton speculation. On motion, 2000 copies of the Report were ordered to be printed for the stockholders. On motion, $500 were voted to Mr Geo. Sharswood, for his services as Secretary of the Committee. A resolution, offered by Mr. Richard Bayard, Esq., for the appointment of a committee to take into consideration the present condition of the Bank-to devise the best mode to be pursued to promote the interests of the stockholders-and to report at an adjourned meeting to be held on Tuesday next-was adopted. The committee of investigation was appointed to be such committe, with the addition of the following gentlemen: S. Breck, of Philadelphia, Col. W. Drayton, S. Carolina; John S. Nicholas, Baltimore; Mr. Swarries, New York; Mr. Richard Bayard, Delaware. A resolution of thanks was voted to the Committee of investigation, for the able and faithful manner in which they had discharged their duties. It was also resolved, that the list of shares transferred on the Books of the Bank, from Oc.ober 1, 1840, to April 1, 1841-should be prepared by the Cashier and published. After these proceedings, the Report of the Directors of the Bank was called for and read. This Report gave the history of the resumption of specie payments-the suspension of specie payments-the late loans, negociations with other Banks, and indeed all the recent events in the history of the institution-the most important which, by the way, are already known to the public.

2. May 29, 1841 The Mississippi Creole Canton, MS

Article from The Mississippi Creole, May 29, 1841

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Article Text

The Revenue and Relief Bill, vetoed by the Govenor of Pennsylvania, passed into a law by the approval of the constitutional majority of both Houses, on the eve of the adjournment of the Legislature. The bill is one of great importance, providing, as it does, for the payment of the public dues and a portion of the State debt maturing within the present year and also affording the necessary legal relief to the suspended banks of the city and county of philadelphia to enable them to carry on business without incurring the destructive ?penalties established by prior Legislation. The Bank of the United States of Pennsylvania is brought within the provisions of the bill, on certain terms and conditions, which may not be complied with by the Stockholders, as their interest may incline. In reference to this institution there appears to be a strong feeling in the business circles of Philadelphia in favor of liquidation. Nash. Whig.

3. February 15, 1842 Indiana State Sentinel Indianapolis, IN

Article from Indiana State Sentinel, February 15, 1842

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Article Text

ever an opportunity was allorded binking intitution to disprove the charges which had been alleged against it. certainly that opportunity existed in the case of the United States Bank of Pennsylrania. And what has been the result? At this lay W behold her prostrate. an ackowledged bank rupt, with her paper selling at less than twenty-five cents to the dollar. the curses of an outraged and ru. ned community have filled the air against her, and er officers and directors, those to whose management all is now attributed. are arraigned before the judicial tribunals of the country, charged with the commission of crimes in their official capacity, to which the most infamous punishment is attached. Nicholas Biddle, the president, but yesterday the demi-god of modern whiggery, IS to-day an arraigned felon. The marble palace over which he presided. with its fretted roofs, its polished columns. and its rolden inscriptions, 18 tenantless and deserted. Within its courts the smiling face and cringing form of the courtier is no longer 10 be seen the voice of the parasite is mute. Crushed by the weight of her own corruption. the Bank of the U. S. of Pennsylvania exists hereafter but "To point a moral and adorn a tale." In thus leaving the subject before the House to pursue the arguments of gentlemen who have preceded me. I trust I am justified in the timation of the House, as I could not otherwis have addressed hyself on the present occasion. In relation to the bill before us. when stripped of the false gloss with which it has been shrouded by the ingenuity of gentlemen, it seems to me to present but one or two very plain features. By the law of last winter, certain funds which the State holds in trust, to be applied exclusively for school purposes, were withdrawn from their legitimate destination, and converted into bank stock. upon the faith of w hich the bank was authorised to issue small bills to an amount not exceeding one million of dollars These funds constitute the entire education fund of the State. The Bank. in consideration of this act of the last session. agreed to issue. and as it is contended has actually issued the amount of small bills contemplated. The present bill proposes to withdraw these school funds from the bank. and reinstate them in the hands of the appropriate agents. Now t is contended by gentlemen that we have no power to pass this bill, because the whole matter was a tract between the last Legislature and the Bank and that to do h violates the Constitution, by HIIpairing the obligation of that contract. It seems to me otherwise. In the first place. let me enquire what is necessary to constitute a valid contract at law. or one that 18 binding in equity. The first great requisite is. that there shall be parties able to contract." The terms "able to contract" imply every th ng that is understood by the right of property in. and ownership over the particular subject of contract. or it implies the absolute right to dispose at W ill of the property contracted for. Had the last Legislature then the right to dispose of these funds at will and was that body authorised to exercise any such absolute act of ownership over them. as to dispose of them by contract for an indefinite period. or in perpetuity ! To answer this question. I think it IS entirely sufficient for me to refer to the erms upon which the funds have been placed in the handsof the State authorities. They are deposited for the exclusive purposes of Education, and the State of Indiana holds them merely as trustee, with no right to divert them in any manner from their indestination. How then can it be maintained that the law of last winter is a contract. irrevocable in all parts If she has done that which she had no right do: if she has asserted an arbitrary au thority to dispose of property. contrary to her powers over and duties to such property, then the act itself is void, and we have only to declare it so. But to make the case still stronger. The bank authorities well knew the condition of these funds, and the manner and purpose of their creation. These authorities were fully aware that the only ground assumed by the last Legislature--th only ground that could be assumed for placing the funds in the custody of the bank-was the security of the funds themselves. With what show of reason then, can gentlement come forward here and advocate the right of the bank as vested. and inviolable, under the acknowledged law of contracts! If the act referred to was a contract between the State of Indiana and the Bank, by which all right to these trust funds was ceded to that institution for an in definite period, then their disposition was to all intents and purposes final, and in no event would the State be authorised. in any manner, to interfere their future application. By this act the State, as gentlemen assert, has yielded all further right to control the funds for the time being: and if so. the surrender must be unqualified. for in the act itsel there is no contingency named in the occurrence of which the State can withdraw them from their present custody. , may be told that the act in question provides that the dividends arising from the stock created by these funds, shall be set part and appropriated as provided for by pre-existing laws. and therefore no diversion of the fundscar be occasioned. This is no answer to the objection. for it may very probably occur. in these times of disaster, that even for a series of years the bank might not be able to declare any dividend upon this or any other portion of her stock. Such things are daily occurring with other banks in neighboring States. and what condi- guarantee have we of exemption from a similar tion! Certainly we cannot draw the most favorable be omens from the conduct of those who claim to the exclusive friends of the Bank upon this floor. Gentlemen whom we have every reasor to believe are in possession alike of a knowledge of her condi- and tion and her wishes, and who appear to move net on this floor in obedience to her mandates, cerrinly evince a sensitiveness on all questions in " hieh the Bank or her interests are involved, which minds is calculated to aronse a feeling of suspicion in the most confiding and unwary. But to assume grounds still stronger. and which that are not impossible or extreme. let us suppose from all information in the power of this House to obtain. and upon which reliance could be placed, to it was ascertained that the bank was involved such an extent that her bankruptcy at no distant this day was inevitable,-is there a member upon No floor who would dare rise in his place and say to the proposition under consideration Is there the one here who at such a time would address hold House in support of the right of the bank to contract to these funds, by virtue of this anomalous Mv life upon it. no such voice would be heard. If weare authorised at all in drawing inferences arise from circumstances, such a state of things may nearly The bank has now been under suspension four years, and every effort to bring her fairly to re- of sumption is met with a resistance little short ac. ferocity. This resistance combined with the knowledged misconduct of several branches contin their doubtful condition ; and the news which we ally receive from adjacent States, is sufficient for to authorize the in saying that there is much cause to dread before us. The signs at least are sufficient justify us in preparing for a threatened storm-to this no be alert for impending danger. say