Stillwater Canal Bank

Bank Information

Episode Type: Suspension → Closure
Bank Type: state
Start Date: March 27, 1840
Location: Orono, Maine (44.883, -68.672)

Metadata

Model: gpt-5-mini
Short Digest: cbce18bddb0d1723

Response Measures

None

Description

Article (dated 1840-04-29) reports new bills of the Stillwater Canal Bank (dated 27 Mar 1840) trading at ~25% discount in Boston and states the bank's returns were omitted in January reports; the tone implies insolvency and impending failure. The piece does not explicitly describe a run, but strongly implies suspension/insolvency and likely permanent failure. Classification as suspension_closure is based on that implication rather than an explicit statement of a formal suspension or receivership in the snippet.

Events (1)

1. March 27, 1840 Suspension

Cause: Bank Specific Adverse Info
Cause Details: Bank's notes heavily discounted (25% in Boston) and omission of returns in January report, implying insolvency or fraudulent depletion of assets.
Newspaper Excerpt: We have observed in the market some new bills of the Stillwater Canal Bank, Orono, Maine, dated 27th March, 1840. ... the bills are at 25 per cent discount in Boston. The appearance of these bills here has very much the air of a swindling operation by being forced off preparatory to an entire explosion of the concern. They are probably not worth one cent on the dollar.
Source: newspapers

Newspaper Articles (1)

1. April 29, 1840 Morning Herald New York, NY

Article from Morning Herald, April 29, 1840

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Article Text

# MONEY MARKET. Tuesday, April 28-6 Р. М. The Great Western is now almost daily expected and there is but little disposition to operate until the receipt of her news. The transactions in the stock market continue to decrease, and the stock list now presents a very shabby return. The amount of sales of fancies and the nature of the transactions are such as scarcely to excite interest beyond the small circle immediately interested in the daily fluctuations. The amount of capital now employed in stock operations is exceedingly small. To-day at the board there was some little variation in the closing prices. Delaware and Hudson improved per cent; North Am. Trust and Banking Co. I percent; Stonington per cent. There was some litt e demand for Long Island Railroad in consequence of the bill passed by the legislature for the assistance of that work. The same cause produces the firmness in Stonington. There were sales of Ohio six per cent stocks at 99. Old Corporation bonds brought par. We have observed in the market some new bills of the Stillwater Canal Bank, Orono, Maine, dated 27th March, 1840. This bank has a capital of $50,000. In January last its returns were not given in the report of the commissioners, and the bills are at 25 per cent discount in Boston. The appearance of these bills here has very much the air of a swindling operation by being forced off preparatory to an entire explosion of the concern. They are probably not worth one cent on the dollar. Uncurrent money is generally scarce and the rate of discount still has a tendency to decrease. Produce begins to appear in the market, and unless the purchasers from the country increase, there is every probability that exchange will be against the city before long. This will then require, according to our newfangled mode of legislation, that our city banks be required to redeem their notes in every town in the state. The quantity of produce with which the shores of the lakes are lined must find a market before purchases are renewed. The indebtedness of the western states to New York city will consequently be greatly reduced, if not squared off, and many sections of the state will have balances in their favour. The operations of trade will, in all probability, equalize the currency of all the specie paying states; but the impossibility of getting any thing from the suspended districts must necessarily prevent the banks from extending themselves. The banks of Philadelphia do absolutely nothing except in irredeemable paper. When checks are presented from their depositors, embracing sums less than five dollars, the banks require that the balance of five dollars shall be paid to them in specie, otherwise they refuse to pay the check, but mark it "good." This is the result of leg lizing roguery. That act has the effect of shaking the credit of those very banks it was meant to sustain. There is due the State of Michigan of the $5,000,000 $3,145,687 50 loan from the U. S. Bank, Morris Canal Bank, 1,048,568 50 Total due, $4,194,250 00 The amount due by the Morris Canal is guaranteed by the United States Bank. The affairs of that concern have fallen into such discredit in consequence of their non-specie paying policy, that the Legislature of Michigan became justly alarmed for the safety of the balance and have passed the following law:- [No. 93.] # AN ACT to authorize the Treasurer of the State to take further security for the five million joan. Section 1. Be it enacted by the Senate and House of Representatives of the State of Michigan. That the Treasurer of this State be, and he is hereby authorized and required to ascertain whether any portion of the balance becor ing one upon the five million loan, is not well secured, and to take such measures as he may derm for the interest of the State, in relation to the security of the same, and to employ such counsel as may be necessary; and the Auditor General is hereby authorised to draw his warrant upon the Treasurer for the amount of the necessary expenses in carrying out the provisions of this act. Sec. 2. This act shall take effect and be in force from and after its passage. APPROVED, March 3, 1540. (A true copy.) THOMAS ROWLAND, Secretary of State These stocks are part of those now held by the Rothschikis as security for the U. S. Bank debentures, now on sale in the London market. The suspended Banke throughout the South are, notwith