7654. Louisiana Bank (New Orleans, LA)

Bank Information

Episode Type
Suspension → Reopening
Bank Type
state
Start Date
February 22, 1842
Location
New Orleans, Louisiana (29.955, -90.075)

Metadata

Model
gpt-5-mini
Short Digest
9fbd5a21

Response Measures

None

Description

Articles (Feb–Mar 1842) report New Orleans banks closed by the Attorney General under a new bank law; Louisiana Bank is mentioned as having been closed/targeted but noted as 'lately resumed' in early March 1842. No explicit run on the Louisiana Bank is described in these clippings; closure appears driven by government action/legal proceedings.

Events (2)
1. February 22, 1842 Suspension
Cause
Government Action
Cause Details
Closed or targeted by the Attorney General under the new Bank Law; sued for forfeiture of charter along with other New Orleans banks.
Newspaper Excerpt
At New Orleans, on the 22d, the Exchange, the Orleans, Improvement, and the Atchafalaya Banks were discredited by the other twelve in operation... Louisiana Bank, par. The Louisiana Bank lately resumed.
Source
newspapers
2. March 5, 1842 Reopening
Newspaper Excerpt
The Louisiana Bank lately resumed.
Source
newspapers

Newspaper Articles (3)
1. March 5, 1842 The New York Herald New York, NY
Article from The New York Herald, March 5, 1842

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Article Text

ST. Louis, Feb. 22 1842. DEAR BENNETT:Yesterday, the bills of the State Bank of Illinois were refused by the Bank of Missouri and the brokers' offices. They fell at once to thirty per cent discount. That bank has probably three millions and a half of dollars in circu. lation. This enormous issue of her suspended paper, was procured through the agency of the Missouri Bank, and the brokers' offices of this City. They took these bills upon general deposit as currency, banked upon them, and received them in payment of debts. Confidence first failed in Cincinnati and Pittsburg. Brokers from those cities sentus the paper for investment. It was'reperted here by the friends of the bank, that drafts on the East would be furnished at a fair premium, to redeem her circulation. The Illinois Bank of Shawneetown, furnished drafts at sight on New York at 15 per cent, but the State Bank brought into market drafts at sixty days, waiving acceptance. Our citizens and the banks have about one and & half millions of this paper in their hands. There is perhaps $800,000 due from the same sources to the bank. The excitement is tremendous, and if the State Bank had an office here, I fear we should see the second part of the same play which lately opened in Cincinnati. This I believe is but the beginning of the financial revolution. The currency now consists of the Miners' Bank of Dubuque, Iowa, the Shawn3stown Bank, and the City and County Scrip. The City and County scrip is good, but the balance is worse than the repudiated paper of the State Bank. We have only felt the first shock of the earthquake The next explosion will prostrate the Miners' Bank, and that will be follow. ed by the ruin of the Shawneetown Bank. Confidence is gone, and no efforts can restore it. Specie is 22 per cent premium, and is still rising. A friend of mine, who wished to make a tender of $2800, was compelled to employ three agents to obtain the sum, and that they procured with difficulty, at the average premium above stated. This is the natural end of the bolstering and suspension system of the State of Illinois, in common with the other insolvent districts. The system of non-resumption is breaking down of its own weight in all pa ts of the Union. At New Orleans, on the 22d, the Exchange, the Orleans, Improvement, and the Atchafalaya Banks were discredited by the other twelve in operation. The COD. sequence was a great excitement, and a rush of crowds to have the paper redeemed for the notes of other banks; but were all disappointed. The following are quotations for the currency on that day:Specie-par. Bankable Funds, 4} to 61 per cent discount. " Municipal Notes, 6 to 8 " Orleans Bank, 15 to 17 " Improvement, 15 to 17 " Atchafalaya 15 " Exchange, 15 to 20 66 Louisiana Bank, par. The bankable funds means the bills of those suspended banks that yet preserve a conventional credit. The Louisiana Bank lately resumed. All the banks now refuse to receive paper on deposite, and the Gas Bank has ceased doing business. Thus it appears the people are lost triumphing over bank corruption, which crushed beneath the weight of its own iniquities. The people have in vain appealed to the laws, to their legislators, and to Congress, but in all' cases the bank power was paramount, and redress was refused. Even the bankrupt law, which was passed to benefit speculators, excluded the only feature that would benefit the masses of the people, that is, to include the banks, aud compel them to pay their debts; (consequently the public have been driven to use the only remedy within their reach, which is to discredit the banks. This will spread from one end of the Union to the other, until nothing remains but the currency of the constitution.

2. March 22, 1842 The New York Herald New York, NY
Article from The New York Herald, March 22, 1842

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Article Text

Financial Explosions in New Orleans. This is truly the age of revolution in every branch of human life-but in none more so thani in banking and currency. We have just received accountsfrom New Orleans, of the great bank explosion which has taken place in that city. This upheaving of the financial revolution has already closed five banks, and the prospect that ten more will give up the ghost. The following is from our correspondent NEW ORLEANS, March 1812 Grand Bank Revulsion in New Orleans-More Bank Frauds-Tellers running away-Italian OperaIrish Repeal. JAMES GORDON BENNETT, Esq.:DEAR SIR:It is a great pity that there is no one to read your articles on the currency, (which are the best written of any paper in the United States,) and so understand them as to put them in practice. If some one here would undertake to do it, he would reap more honor in the end than half a dozen financiers. As this is the second commercial point in the United States, it should have a solid specie currency, and its exports should always exceed the imports. Yesterday the city was all excitement again, caused by the closing of the Atachafalaya Exchange and Orleans Banks, by the Attorney General, under the new Bank Law, which will be liquidated by the Board of Currency, who are all in favor of specie payment, and three better men could not have been chosen is our whole community. The Improvement Bank has petitioned the Legislature to go into liquidation, which I think will be granted. The Attorney General has commenced suits against all of the other banks that have not accepted the law-viz: City, Union, Louisiana, Canal and Commercial, all of which will probably be closed upin a few days. The Merchants' Bank has closed her doors, after being perfectly used up She was trying to get a snapat the public pap, but her wind broke before that stream could be brough to her aid. Uncle Sam cannot de better than to leave his money where it is, in the Union Bank. Failures are plenty here, but rouges are more so. Yesterday morning the Paying Teller of the Atachafalaya Bank was discovered to be among the missing; and as usual in suca cases, the cashier, clerks and all, began to overhaul the accounts, when it was ascertained that several individuals, with himself, had overdrawn their accounts to the amount of 150 to $2000,000, for which amount he left his due bill. His securities are not worth one cent, and some of them may have had a finger in the pie. So wego-we will soon arrive to such a state that when a man accepts any office whatever in a bank, he will be immediately set down as a rouge. We are a very quiet people here; the banks can pay or not, just as they please; it matters not to us. If they had acted in some places as they have done here, they would all have been laid to the dust ere this; while here you will only discover few persons collected together in some shanty, talking the subjectover very calmly. Business-as far that there is none here, and the less said about it the better. Cotion dull, very; flour $5, and dull; will be lower with you; pig lead, one of our great articles, has of late taken a new channel, and some 10 to 12,000 pigs have been purchased for the French market, at $3,75 to $4; whiskey 16c; corn 42s. Theatricals are in full tide just now. At the San Carlos they have the Italian Opera, which is doing wonders. Madame Ober Rassi has taken our creoles by storm, and it is with the utmost difficu ty that you can get a seat on the nights of the Opera. Mr. Bulter is playing the off-nights, in conjunction Brown and Miss Rock. Last night Fanny tz commenced an engagement at the American to a brilliant house. The Or.eans is doing nothing of note while the Italians are at the Saint Charles. This is a great city, and we do things up on the most approved plan. Of late we have had several Irish repeal meetings; and to-morrow night we are to have an anti-repeal one, so you see we shall have the benefit of both sides of the argument. We have had a very serious los in the burning of Jefferson College, which was one of the greatest ornaments to the State. Loss about $160,000; insured for $62.000, $40,000 of which is in the Ocean Insurance Company We have here now the most delightful weather, like July with you. River on the stand: More anon.

3. March 22, 1842 New-York Tribune New York, NY
Article from New-York Tribune, March 22, 1842

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Article Text

and Banking Company, claims the correction of the report that be was about to declare a dividend from the assets of that concern. The notes of the Bank of Ithaca are redeemed at the American Exchange Bank. The Receivers of the Union Insurance Company will make a second dividend on the 13th April. We have a letter from our correspondent in Cincinnati which states that business was very dull and money matters anything in a worse condition than before the resumption. The currency is composed principally of Indiana Bank Notes, which are 2 to 3 per ct. below Ohio country money, and notes of an unchartered institution, the Traders' and Mechanics' Bank, which are 2 per cent below Indiana.Merchants in Indiana pay their debts to Cincinnati in Indiana money which is 6 to 7 per cent. cheaper than Cincinnati exchange. New York 10 a 11, Indiana State scrip 45 a 50 dis. Illinois State Bank 60 per cent. Bank of Illinois 25 discount, all for bankable money, not specie. Letters from New Orleans speak in the most discouraging terms of the appearance of business matters in that city.Every one is much embarrassed, and in fact apparently "chaos is conse again." The Merchants' Bank has broken and refuses to pay the checks dra vn upon it by the Commercial Bank of Natchez. They were selling at 10 to 20 per cent. discount. Itis reported that the Merchants' Bank has misappropriated about 150,000 deposited for the redemption of these checks. The Exchange, Atchafaya and OrLeans Banks have been closed by the Attorney General and their assets are now in the hands of the Board of Currency. The Louisiana and Union Banks have been sued for a forfeiture of their charters. It was reported that the Board of Directors of the Louisiana Bank would all resign, but this was disputed. The Improvement Bank will be immediately put into liquidation. Proceedings had been commenced against ten of the sixteen banks by the Attorney General. It was supposed that only eight or nine of the New-Orleans Banks would weather the storm. The Cashier of the Atchafalaya had absconded, owing butn small sum, $500 to $2,000, unless a larger deficiency should be discovered. Matters in Philadelphia were wearing a better aspect than for some time past. There was HO excitement in relation to the Banks, and the difficulties which appear to surround and render resumption impracticable, had vanished before the attempt. In fact, it appears that both banks and people are easier than before the resumption took place. At a Convention of many of the Country Banks it was resolved not to resume, but to abide by the Relief Law. A majority of the Committee appointed to investigate the Towanda Bank have reported that the assets are more than sufficient to redeem all its liabilities. The Mechanics' Bank of Burlington, N. J., has made arrangements with the Bank of North Amersca for the redemption of its notes. The following Delaware Banksresumed specie payments, says the Philadelphia North American, to-day: Bank of Delaware, at Wilmington; Farmers' Bk. of Del. do.: Union Bank, do. do.; Wilmington and Brandywine Bk. do. The 20.08 of the Farmers' Bk. at Dover, and the Bank at Smyrna are received in deposit at the Smithtown M Bank. New-York Market. ASHES-The sales are only in retail lots at $6 75 a $6 621 for Pots, and $5.50 a $5.62 for Pearls. COTTON-The transactions to-day reach about 1,000 hales, at previous rates FLOUR-The market is firm to-day at SG 25 for Genesee. and some large holders refuse this rate No important sales. Ohio Canal $6 12} a $6 25. About 600 bbls. New. Orleans, afloat, sold at $6.061. In Southern there if not much doing. but the market is Arm. Georgetown and Brandywine, 5 871 a $6. Small sales Brandywine Corn Meal, to arrive, $15,4*mos. GRAIN-Corn is rather more plenty, and heavy sales on Saturday and to-day of about 8,000 bushels white Vir ginia and North Carolina, at 56 cents, weight, for distillery 800 bushels Jersey at 62k About 2,000 bushels Rye, for the East, sold at 61 cents. Oats are plenty and declining Nearly 8,000 bushels Southern are in the market. Wequate Northern 45 a 50; Southern 40 a 45. The last sale South ern 2,000 bushels at 45 cents.