22007. Essex Bank (Guildhall, VT)

Bank Information

Episode Type
Suspension → Closure
Bank Type
state
Start Date
July 9, 1839
Location
Guildhall, Vermont (44.565, -71.560)

Metadata

Model
gpt-5-mini
Short Digest
dc1dd202

Response Measures

None

Description

Contemporary reports (July 1839) state the Essex Bank of Guildhall ceased redeeming its notes, its paper sold at heavy discount, and it is listed among recently suspended institutions (Oct 1839 item). Articles cite mismanagement/speculation and the Vermont safety fund connection, implying a state-chartered safety-fund bank. No explicit description of a depositor run or later reopening is given; evidence points to suspension and permanent closure/insolvency.

Events (1)
1. July 9, 1839 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Reports of mismanagement, unwarrantable speculations, and inability or refusal to redeem notes led to loss of confidence and suspension of redemption; notes became unsaleable and heavily discounted.
Newspaper Excerpt
after having redeemed its issues for several months in this city, from some unknown cause it ceased to do so, when its notes fell to 25 a 50 per cent discount.
Source
newspapers

Newspaper Articles (3)
1. July 9, 1839 Rutland Herald Rutland, VT
Article from Rutland Herald, July 9, 1839

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Article Text

The Essex Bank Though we have been heretofore somewhat silent about this bank, we have not been ignorant of the ru. mors of mismanagement. And the reason that we have not called the attention of the public to the subject was because, though repeated inquiries were made, we could not obtain any facts to enlighten the community about its affairs, or the validity of the bills. We are rather in the dark yet in relation to the precise condition of it; yet we are aware that some unwarrantable speculations have transpired that render the bills a little suspicious, and hence they are uncurrent. We however have heretofore entertained an opinion that the bills must ultimately be redeemed at par. Our reasons for this opin. ion were that the safety fund banks (and this is one) are subject to pay ten per cent on all their net profits to make up any defalcation which may arise from misfortune ormismanagement of any i of the associated banks, and hence it will depend much upon the amount of the defalcation and the amount of the fund to meet it. If there has been a wanton abuse of the grant and an intention to practice an extensive fraud, beyond the ability of the fund to make good, there may be a loss. As might have been expected, there is no inconsiderable degree of murmuring about the affair, (and not without reason) that some light has not been given to the pub. lie long ago on the subject by those whose duty it was to do so. We copy what a foreign correct statistical paper says about this institution with only the additional remark, that the bills ought to be received with great caution either about home or abroad, on any terms, until the affairs of the bank are satisfactorily developed. " The movements of the Essex bank of Guildhall, Vt. are viewed with distrust, and justly so; for, after having redeemed its issues for several months in this city, from some unknown cause it ceased to do so, when its notes fell to 25 a 50 per cent discount. The bank then bought up as much of its own paper as it could get hold of, and again commenced their redemption in this city, in order to establish a confidence in the western part of the State, where it has been offering its notes without interest for notes payable by farmers, having 60 a 90 days, and even 4 months to run. This conduct has caused much suspicion and its notes are at present unsaleable in this city, and consequently of little real value to the holders -Sylvester's Reporter.

2. July 12, 1839 Vermont Phœnix Brattleboro, Bellows Falls, Ludlow, VT
Article from Vermont Phœnix, July 12, 1839

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Article Text

Essex Bank. We caution the public against receiving the Bills of this Bank. We learn that it has recently been purchased by western speculators, and no doubt is bought entirely for speculating purposes. Here will soon be a second edition of the "Windsor," "Lafayette," *Commonwealth," blow up, as like them it is under Loco Foco management-the Cashier is one of the "Faithful," and we presume the western speculators are Leg-Treasurers from the East. We commend this to the notice of our neighbor the Democrat, as he with his usual veracity, will call it a Whig speculation, the following article IS taken from Sylvester's (N. Y.) Reporter: The movements of the Essex Bank of Guildhall, (Vt.) are viewed with distrust, and justly so; for after having redeemed its issues for several months in this city, from some unknown cause it ceased to do so, when its notes fell to 25 a 50 per cent discount. The Bank then bought up as much of its own paper as it could get hold of, and again commenced their redemption in this city, in order to establish a confidence in the Western part of the State, where it has been offering its notes without interest for notes payable by farmers, having 60 a 90 days, and even 4 months to run. This conduct has caused much suspicion and its notes are at present unsaleable in this city, and consequently of little real value to the holders."

3. October 5, 1839 Morning Herald New York, NY
Article from Morning Herald, October 5, 1839

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Article Text

houses, and the merchants are sacrificing their property in vaia struggles to meet their payments. There is growing impression in Wall street, that the Philadelphia banks must soon suspend. It is also reported that a great anxiety exists in Philadelphia for the New York banks to take the lead in such a movement. That cannot be, however; the New York banks are in a situation which is impregnable, until the depositors withdraw their deposites-an event which is probable only in case a high premium for specie is created in Philadelphia by a previous suspension of the institutions there. There are many of the speculative class of dealers who are anxious to bring about a suspension to ease their own affairs.We are not, however, apprehensive that such will be the case The many suspensions which have recently taken place are principally of badly conducted institutions, among which were the following:-Middling Interest Bank, Boston, Jewett City Bank, Conn; Essex Bank, Guildhall, Vt.; City Bank of Detroit, Bank el River Raisin; Bank of Darien, Geo.; Chelsea Bank; Willoughby Bank. There is every probability that many of the Southern Banks will suspend in consequence of the delay caused to the crop by the prevailing sickness. The indebtedness of that region to New York is of such a nature, being old debts, that it is not depended upon as present means. In Philadelphia and Baltimore, however, large Jebts were accumulated last spring which will trouble the banks of those cities unless they can be realised. Should the delay of southern payment carry them to the point of suspension, New York may be obliged to follow in her wake, more especially should the news by the Liverpool be as gloomy as is anticipated. Sales at the Stock Exchange. $2000 Corporation Bonds, payable in October 1840, 97-5 shares U S Bk 100g. 5 do 100A-50 do Com 943, 50 do 95, 50 do 30 ds 95.75 do 95, :00 do 84 mes941-15 do Manhattan Com 118-6 do4State Bk New York 93)-155 do Del & Hud 574, 50 do 57th 50 do s 60 ds 574, 50 dos 60 ds 573. 150 do s 10 ds 58, 50 do S 30 ds 58, 190 do 5St, 100 do a 30 ds 58, 130 do 581, 50 do S 60 ds 58, 215 do 58, 200 do 58 100 do 8 30 ds 58. 100 do S 60 ds 58 82 do 581, 25 do nw 581, 50 do 5th, 50 do S 30 ds 58, 50 do n w 581 900 do b n W 581, 50 do S 30 ds 58-20 do Am Ex Bank 79}. 35 do 791-10 do N A Trust 531, 110 do 534. 25 dos 30 ds 53 25 do 8 30 ds 537, 50 do 54, 125 de S 30 ds 53g. 25 do s10 ds 53g. 13i do 54, 50 do s 30 ds 534. 190 do 54, 00 do b next wk 54, 25 do b 30 ds 55, 25 de 54. 25 do b 30 ds 544-150 do Vicks burg Bk. tomorrow 33-50 do Kentucky Bk Monday 72 50 do nw 724. 50 do Menday 721, 50 do nw 72.100 do 72-10do Morris Canal 29-10 do Manhattan Ins Co 1051-25 do New York Gas Co 124-50 do Mohawk 524, 25 do 521-50 do Boston and Providence 60 ds 100-25 do New Jersey RR SS-110 do Stonington 211-28 do Utica 1153-60 do Harlem Rail Road a 15 ds 124, 150 do 421, 100 do 424, 150 do b 10 ds 424, 100 de 421. State of Trade. The sale of dry goods advertised for today by John Haggerty & Sons, consisting of 194 pkgs, was but a sorry affair. Tle attendance was very thin, and the goods went off very heavily at prices mach lower than at former sales. The dry goods trade generally is very quiet at this moment. The latter part of the present month is looked forward to by the tr de with much confidence that a good business will be done. This impression is warranted by the prosperous state of the inland navigation, and the large movements of produce, the arrivals of which at Buffalo, during the month of September, were as follows 25,027 bbls. 168 239 bushs. Flour, Wheat, " 14 646 1,197 kgs. Lard, Corn, 453 bbls. 181 000 Staves, Pork and Fish, In this market, cotton is quiet. In flour there is more firmness, in consequence of the decreased arrivals. Holders are stiff at $5 75 a $5 87}.