Merchants Bank - Boston, MA

Bank Information

Episode Type: Run Only
Bank Type: state
Start Date: October 6, 1857
Location: Boston, Massachusetts (42.358, -71.060)

Metadata

Model: gpt-5-mini
Short Digest: 379ada07

Response Measures

None

Description

Article (NY Tribune correspondence dated Oct 6, 1857) describes a small/brief run on the Merchants' Bank of Boston triggered by alarm over its loans to C. H. Mills & Co. and Lawrence & Stone, but explicitly states the run was minor and the bank remained strong and did not suspend.

Events (1)

1. October 6, 1857 Run

Cause: Bank Specific Adverse Info
Cause Details: Alleged large losses on loans to C. H. Mills & Co. and some exposure to Lawrence & Stone prompted depositors to withdraw specie.
Measures: None mentioned; run was small and business continued as usual.
Newspaper Excerpt: some ignorant persons holding its notes became alarmed, and went to its counter for the specie.
Source: newspapers

Newspaper Articles (1)

1. October 8, 1857 New-York Daily Tribune New York, NY

Article from New-York Daily Tribune, October 8, 1857

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Article Text

STATE OF FINANCES AT BOSTON. Correspondence of The N. Y. Tribune. BOSTON, Tuesday, Oct. 6, 1857. At this 3 p. m. we have no intelligence of any failures to-day. The reported suspension of Rice K. & Co., a large was untrue; it was Richardson K. & Co. The Merchants' Bank of this city, 80 wisely menaged for many years past by Franklin Haven, its President, was said to be so large a loser by C. H. Mills & Co. and Lawrence & Stone, that some ignorant persons holding its notes became alarmed, and went to its counter for the specie. To business men, this little run was simply ridioalous. There is not a moneyed institution in the country stronger than the Merchants' Bank of Boston. It has a capital of four millions of dollars, but its circulation is comparatively small. Originally it was a much smaller institution, but under the remarkably successful administration of Mr. Haven (who has been its President for about twenty years past) its capital has been increased from time to time, until it has become by far the largest and strongest Bank in the State. The loans made by the Merchants' Bank to the great house of C. H. Mills & Co. were all amply secured by collateral; 80 that it will not lose a dollar by their hard fortune Nor did it have more than a small amount of Lawrence, Stone & Co.'s paper, and its loss from their failure will not probably exceed a thousand dollars. This Bank has just completed the erection of noble edifice, occupying the entire front on Stat street from Wilson's lane to Exchange street, and ex. terding to the depth of about two hundred feet. In addition to the most spacious and convenient bank. ing room that I have ever seen, it has five rooms for other barks, insurance offices, &c., the rent of which will yield a large annual income for the investment. The Suffolk Bank also has just moved into the new and costly building which has been built upon its former site. Its bouse.warming," I an told, was an accession of $300,000 in specie, in addition to what it had in its vaults last Saturday. Since the merchants' meeting, on Friday last, more confidence and cheerfulness has been perceptible. Today it has appeared (to an outsider, at least) a little easier. It seems certain that the Boston banks will not suspend. I have heard of a broker who is drawing specie from them at the rate of about $4,000 a day, in order to sell it for their notes at 8 premium of one per cent. He boasted yesterday, to an acquaintance of mine, that "he was making his $40 & day" in this reputable manner! It never seemed to occur to his little mind that it would be better for the public to give him $40 a day than to suffer him to set 80 mischievous an example. My impression, from all that I can see and hear, is, that the panic has had its day-the fever is over, the crisis is past, and the community is convalescent, though it may have some 'pull-backs," and its recovery will be slow. If any considerable proportion of Western produce should come forward, in liquidation of debts owed here by the West, before the canals shall be closed, our business will be restored to something like prosperity as early as January next; otherwise it must continue in a bad way until the opening of the Spring.