9915. Bank of the State (St Paul, MN)

Bank Information

Episode Type
Run → Suspension → Closure
Bank Type
state
Start Date
March 16, 1859
Location
St Paul, Minnesota (44.944, -93.093)

Metadata

Model
gpt-5-mini
Short Digest
44c2db77

Response Measures

Accommodated withdrawals, Full suspension

Other: Assignment of assets to A. G. Langford as assignee/receiver.

Description

A targeted run by local firms (Borup & Oakes) occurred in March 1859 (article 1). Later, in October 1859 the bank closed its doors, suspended because eastern correspondents failed (Sewell, Ferris & Co.) and returned protested drafts; an assignment of assets to A. G. Langford for benefit of creditors indicates permanent closure/receivership.

Events (3)
1. March 16, 1859 Run
Cause Details
Targeted redemption activity by local banking houses (Messrs. Borup & Oakes) demanding gold for notes and repeatedly presenting notes for specie.
Measures
Paid legal coin/gold for presented notes; cashier offered legal tender when appropriate; bank defended right to pay in lawful money and to limit extraordinary redemptions.
Newspaper Excerpt
This Bank has been subject to a run from Messrs. Borup & Oakes, which commenced on the first day it opened its doors for business.
Source
newspapers
2. October 13, 1859 Receivership
Newspaper Excerpt
an assignment of the money and effects of the Bank, for the benefit of creditors, made to A. G. Langford, Esq.
Source
newspapers
3. October 13, 1859 Suspension
Cause
Correspondent
Cause Details
Failure/suspension of eastern correspondents (Sewell, Ferris & Co.) leading to returned/protested drafts and immediate demand by holders requiring the bank to close and make assignment.
Newspaper Excerpt
To protect your interests... its doors were closed this morning, and an assignment of the money and effects of the Bank, for the benefit of creditors, made to A. G. Langford, Esq. The immediate occasion of this is the return of drafts under protest, resulting from the failure of Messrs. Sewell, Ferris & Co. of New York...
Source
newspapers

Newspaper Articles (7)
1. March 19, 1859 Saint Paul Weekly Minnesotian Saint Paul, MN
Article from Saint Paul Weekly Minnesotian, March 19, 1859

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# The Controversy Between the Banks. [The following article was called forth by an editorial item in the Times of Wednesday stating that bills of the Bank of the State of Minnesota, presented by Messrs. BORUP & OAKES for redemption, had been redeemed in small coin, terming it a "trick" &c. Wegive the reply of the President of the Bank and also appended a statement from Messrs. BORUP & OAKES.-Ed.] ST. PAUL, March 16, 1859. To the Editors of the Times. SIB: Judging by the article in your paper of this morning, headed "Something of a Run," you have been misinformed in relation to the matter of redemptions by the Bank of Messrs. Borup & Oakes. The following is a true history of the matter which I think you should give to the public in your columns, in answer to the article above alluded to. This Bank has been subject to a run from Messrs. Borup & Oakes, which commenced on the first day it opened its doors for business. Mr. Oakes presented for redemption on the second day after opening $100 dollars of the notes of this Bank, demanding gold for them, which he was paid. They continued to present and demand gold from time to time, until they had received some $2,500 gold for the said notes. This Bank has always been ready to draw on New York at a quarter less than current rates for its notes, thus making them worth to the holder per cent. more than Illinois and Wisconsin currency, and always convertible. Messrs. B. & O., agreed with the officers of this Bank to become the footmen and Runners of Messrs. B. & O., in a matter relating to endorsed currency, the said B. & O., forgot the agreement they had previousiy made. Messrs. B. &.O., by means of such representations as they made to a respectable notary, persuaded him to present for them, notes of this Bank for redemption. Said notary on presenting said notes, and learning the truth of the matter, refused to have anything further to do with the business. Messrs. B. & O., then procured the services of one S. S. Eaton, a notary who presented notes for redemption, on the 12th inst., and was paid legal coin of the United States, which he left on the counter. He soon returned, and pocketing his previous payment, presented more notes, for which he was tendered legal coin. The fourth time he called, he presented eight dollars and demanded gold for them. The cashier made him a legal tender for them, which he refused, and asked the cashier if he refused to pay gold. The cashier replied he did not. Said notary left, and on Monday evening this Bank received notice from the Auditor of the State, that he had received a formal notice of protest of the notes of this Bank, to the amount of eight dollars. The said notary certified in his protest of said notes, that he demanded lawful money of the United States, which was refused. The Bank of the State of Minnesota is ready, at all times, to redeem its issues in specie, and will do so, in gold, to the entire satisfaction of the public, when bills are presented in the usual course of business; but when extraordinary means to withdraw our bills from the channels of business, for the purpose of wantonly annoying and injuring us, we feel justified in paying such coin as the laws clearly uphold us in paying, without consulting the convenience of the harpies who seek not alone to injure us, but who, by discouraging Banks of issue, prevent the increase of many facilities, and strike a blow at the commercial interest of the community. Not a dollar would be invested in banks anywhere, if their issues were to be systematically run home for gold; more especially would this be true in this State, where the circulating medium is currency, at not less than one per cent. discount for gold. A moment's regard to the operations of business will render this obvious: A bank loans its bills at a moderate discount to business men, and is repaid in the ordinary mixed currency, worth one per cent. less than gold; if the bills so loaned out, are immediately gathered up, and returned to the bank for gold, the bank sustains a loss that would compel it to retire its notes, and close business; and to the extent of its capital, the business community would lose many facilities. We apprehend the public will not be slow in appreciating its interests in this question. P. WHITNEY, President, # TO THE PUBLIC. The issue between the Bank of the State of Minnesota and ourselves, is simply this: 1. We claim the privilege to demand the redemption of their own bills at their own counter, in regular business hours, just as it suits us, without giving any reason to the bank for so doing, and without paying any premium for such redemption. At the same time, we disclaim all intention of "running" this or any other bank, but we have daily to make remittances to New York and elsewhere, and can only do it by converting currency into something available for that purpose. The bank has always offered to give us exchange at 1¼, but for reasons of our own we have preferred to take no risks, and paying in addition for doing so, 2. The Bank has repeatedly insisted upon its right to redeem one bill at the time. 3. The Cashier has taken upon himself to take the bills away from our messenger, offer such redemption as he saw fit, and when this was declined, he refused even to return the bills. 4. The Bank claims the privilege of redeeming a certain amount in one cent pieces. To all of this we object. In our opinion there

2. October 14, 1859 The Weekly Pioneer and Democrat Saint Paul, MN
Article from The Weekly Pioneer and Democrat, October 14, 1859

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BANK OF THE STATE OF MINNESOTA.Some excitement was occasioned yesterday by the closing of the doors of this bank. The reason assigned for this action is, the suspension of eastern correspondents, and the consequent return on them of protested drafts. It is understood that the owners of this bank are responsible for the issues of the Nicollet County Bank, located at St. Peter. By the last report, the circulation of the Bank of the State was only about $14,000, to secure which there are deposited in the office of the Auditor $26,000 of Minnesota eight per cent. bonds, which are above par at this this time in New York. Of the Nicollet County Bank there are also $14,000 of notes in circulation, for the redemption of which there are $30,000 in University bonds deposited with the Auditor. No fears are entertained by the holders of notes on either of these banks of sustaining any loss. We are advised by the owners of the Garden City Bank that there is no connection between that and the Bank of the State nor the Nicollet County Bank, and that their issues are secured by Minnesota eight per cent. bonds. The excitable state of the public mind in relation to financial affairs renders the sus-

3. October 14, 1859 The Weekly Pioneer and Democrat Saint Paul, MN
Article from The Weekly Pioneer and Democrat, October 14, 1859

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THE WEEKLY PIONEER AND DEMOCRAT I Ill. In the first, Preston advises Merrick pension of one bank a most serious misforn to make him a visit in February, "to make tune to all, no matter how solvent they may e be. When a panic is created, reason and a good draw on deposits"-Preste being h common sense will not be listened to, until to at the time County Treasurer. The second it has exhausted itself and distressed the n letter is the one which Merrick tore up at whole community. tthe time of his arrest we have inserted We are assured that bill holders in both in the State and Nicollet Banks are amply asterisks to mark the strip torn out of the in secured, and no senseless panic should induce as letter and destroyed. them to sacrifice them. d [Number 1.] JUNE 16, 1859. es PREPARING FOR A LARGE TRADE.--The Dry Mr. J. MURRICK, Esq.-Sir: Yours of the 2d d Goods House of Messrs. Cathcart is now being inst. is at hand. I was glad to hear from you. to I want to know if you was at Peoria; sent a filled up with a very large stock of Winter e letter to you there, with quite a large amount Goods, which the senior partner has been of drafts, which 1 think you would do well to k selecting in New York. The long experience get. I got them in part pay for the mill prope, of Messrs. Cathcart as purchasers, gives them erty you sold. The balance have got in landed warrants, and will send them to you if they peculiar advantages in making selections, and d will do you any good. You had better be very the large stocks furnished four times yearly, he cautious, and keep away from telegrahps and give them oppertunicies to buy mostly from railroads. You need not be afraid to tell me, ed as a friend, and besides I may be of great first hands, and their customers reap the beneassistauce to you from time to time. In Februfit of these advantages, in reduced prices for rary I would like to have you make me a visit, the goods. This house is better prepared than secredy, as there will be a chance to make a logood draw on deposits. However, I will advise ever before, to compete with Eastern prices, you in time on that matter. I wish you to rand the inducements offered to Country Merwrite often, and tell me the whole secret of chants will be great enough to save them the your plans. Business is good here-the people time and expense of going East for Dry Goods. are all well at present. Very little inquiry rs about you, but some think that it is time that County dealers will do well to examine their e there was a letter from South America. Now. stock and prices. I my advice to you is to be very careful, for if Id you don't it will expose me and play the devil A Black Republican Criticism of Daniel generally. Keep shady. en think, this winter there will be a chance to Webster m make a raise in this county. Nothing more at t. present. I will write you a long letter the next A Boston correspondent of the New time hear from you. d J. H. STANTON. Yours truly, York Tribune furnished the following critihe P.S. Continue to direct your letters to the cism upon DANIEL WEBSTER. Old line r. same place. All is safe. Try to disguise your tWhigs who now swear by the Tribune, will handwriting on the envelope addressed to me. re make note on't. send you a draft properly endorsed. er Don't fail to write immediately. Daniel Webster was born in New Hampe '59. BIG SPRINGS, shire, from which place, having been starved * n Sir 3 days ago wrote to you out by his creditors in early life, he came to ed at Peor* you the balance of what Boston, where he was owned for thirty years was which is $1500 (hundred) by a few corporations, who, then finding drafts. I hope get them. er Your him damaged and expensive to keep, sold dSTANTON. [Signed] him for $50,000 to a New York Company, Keep shady, old ***** who soon put him off to the slave power for Sa promise of the Presidency. The last [Number 3.] r purchaser, having got the article, did not AUSTIN, MINN., May 1859. MR. J. MERRICK, Esq.-Sir Enclosed please pay the consideration, and there being no in find the balance of your account that I have means of enforcing the contract, either in e collected for you. Try and do the best you Federal or State Courts, Mr. Webster re can in your peculations. Mr. Johnson sends ve you one hundred dollars in a draft. He lives in tired to Marshfield, where, having "sot" on en Lake City. Minnesota. I send you two one Mr. Winthrop, he died, and was buried thousand dollar drafts from Mr. T. Judd. of with great pomp. He was then duly cant. Faribault, which is all he can pay. and which nonized by Mr. Everett, and his statue by pays nearly all that he is owing you. I'Powers, an execrable caricature, was set The balance of the drafts are those that were collected for you on that mill property. up in the State House yard, causing much I hope you will have good luck in your specu speculation among the members of the lations, but my advice to you is not to venture General Court, whether it was meant for too far. y. Pericles, Pompey's Pillar, or the Razor e Be cautious in all your undertakings. Better at lose all than fail. You must use your own Strop Man in a mood of wrapt contemplaut judgment in this matter, but do not get into tion, or if it is Webster, whether it is Danu. trouble. Save yourself and then you can save iel, Noah, or the Professor. Opinions differ. others. go A respectable tailor attracts good custom pIf you cannot do well, you had better give it I by advertising that he did not make the up. but as you think best about that you can ill pantaloons, on his statue. do. I would advise you to get a partner. as a e good partner would be of great service to you. Mr. Webster was a good lawyer, a modWrite soon. to J. H. STANTON. erate statesman, a poor diplomatist, and at n, rs one period of his life an orator. From this PATRICK T. BROWN. Sworn--Reside in hr latter complaint, however, owing to full feedDabuque, Iowa, and acted in the capacity g of Assistant Postmaster in the winter of ing, he recovered. His private life was adorned with some virtues. He was a er 1859. Our office is a distributing office. ts first rate judge of chowder, the English Registered letters are noted in a book kept to classics, and old otard. He was an expert especially for that purpose. Letters from x the East for distribution are directed to the fisherman, though timid in a boat a poor th shot, and had the best hog in Plymouth to Postmaster of the distributing office. On sh county. He attended church with considthe 12th of January, we received a bill of i erable regularity, and his respect for the registered letters from Chicago, among Methodist clergy was great. He hated a which was a letter numbered 302, directed lean ox. an unfilled can, and Abott Lawto H. W. Lamberton, of Faribault, Minn., rence. He loved brook trout, Peter Har-there were two letters in that package addressed to Faribault--one of them was vey, and his country. He left to his family rs a splendid legacy of unpaid debts, and a at directed to O. Brown, and numbered he sincere love of good liquor. He was a good the entire package was received too late to y looking man, Powers to the contrary, notgo out to Faribault on the 12th--they were of withstanding. The great army and innumermade up on the night of the 12th of Januu able company of American insolvents will ary, and sent out on the morning of the ot continue throughout all time to hail him as er 13th, overland to Faribault, via Dacorah. i their august apostle, and will treasure his On the 13th of January, there was a mail Is memory and copy his example with affecsent to Preston. In the winter of 1859, our y tionate fidelity and respect. To all good custom was to make up two bags, one to n. rlittle boys, and Presidential aspirants, the contain St. Paul matter and all beyond, and lethe other all the mail matter between the chief lesson of his life is, Own Thyself. Iowa line and St. Paul on the route. At Arrival of the Indian. that time the Preston and Faribault mail went in the same bag. The bag for St. at NEW YORK, Oct. 11.-The steamship InPaul was sent under a brass lock--the ht dian has arrived, with Liverpool dates to the n, way mail under an iron lock, which could 28th, three days later. at have been opened by Postmasters on the It was announced that a definite treaty he way. is of peace between France and Austria would er MR. PELETIER, recalled-Mail for Faribe signed in a few days at Zurich. re The impression prevails that the Great bault comes from Dubuque through PresIt ton. All Postmasters on the route have Eastern would be still further delayed, and g same key. that her departure for the United States 'll would not take place on the 20th inst. More testimony was offered by the proseis The telegraph cable between Sicily and cution of an unimportant character, when Malta had been successfully laid. they rested their case, and the Court adIt is rumored that Sir Hope Grant is to m u journed until ten o'clock this morning. have command of the expeditionary force to y China, and that 10,000 men will be sent The virtue of punctuality don't seem to it from India, but none from England. no be observed in our Courts sufficiently. The ot The amended Zurich programme states Judge frequently waits for the counsel, I that a definitive treaty of peace will be jurors, or the prisoner a long time. We ty signed by the three powers, and that a should like to see the Court punish in some treaty would be drawn ceding Lombardy to all Sardinia. Other arrangements would be manner this prevalent vice among those who at come to between France and Austria with is have business before the Courts. I reference to the Duchies, Sardinia utterly en rejecting the restoration. n. BANK OF THE STATE OF MINNESOTA.CHINA.-Dates from Hong Kong to Auor Some excitement was occasioned yesterday gust 10 had been received, but nothing of by the closing of the doors of this bank. any moment had transpired. The reason assigned for this action is, the Mr. Ward, the American plenipotentiary, suspension of eastern correspondents, and in had not obtained the ratification of his the consequent return on them of protested ed treaty, nor was there any likelihood of his drafts. 's doing so. It is understood that the owners of this it A Russian authority estimates the loss of bank are responsible for the issues of the in the Chinese at the Peiho forts at about Nicollet County Bank, located at St. Peter. er 1,000 killed. By the last report, the circulation of the ct The state of Admiral Hope's health con-

4. October 15, 1859 Saint Paul Weekly Minnesotian Saint Paul, MN
Article from Saint Paul Weekly Minnesotian, October 15, 1859

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MONETARY.-The doors of the Bank of the State of Minnesota" were closed this morning, giving rise to sundry rumors concerning it. But the facts of the case, (as well as we can learn them-in lieu of any official statement emanating from the officers) show it to have been owing to causes that are not local, but such as are liable to occur to banking institutions anywhere under the same circum stances. This, we understand, was the failure or suspension of their eastern partners, and the return on them of protested drafts. These houses were the owners of the "State Bank of Minnesota,"-founded on Minnesota 8's-and the "Bank of Nicollette County," founded on State University Bonds. The circulation of the Bank of the State, as reported by the officers. in accordance with the banking law, last week, was a little over $14,000, to secure which there are over $26,000 worth of Stocks on deposit. They also report on Oct. 9th, $14,000 of notes of the Nicollette County Bank in circulation, to secure which $30,000 of the State University Bonds is deposited with the Auditor. The suspension will not affect the value of their circulating notes in the least. The Minnesota 8 per cents were sold in New York a a few months ago at 108-which still leaves the bills "as good as gold." The State University bonds have no market value that we could at present quote, but holders of the bills should not get panic-struck and sacrifice them as usually the case. As is usual in such cases, absurd rumors concerning other banks were invented, and re-issued again more ridiculous than at first, -until some little panic had been created.But those who know how such things are generally fabricated, will not be deceived by them.

5. October 15, 1859 Saint Paul Weekly Minnesotian Saint Paul, MN
Article from Saint Paul Weekly Minnesotian, October 15, 1859

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THE BANK OF THE STATE OF MINNESOTA.-We have received the following communication from N.P. Langford, Cashier of the above Bank, which we noted yesterday as having closed its doors. To Depositors, Bill-holders and other crediitors of the Bank of the State of Minnesota: -To protect your interests, in common with the interests of Stockholders of this Bank, its doors were closed this morning, and an assignment of the money and effects of the Bank, for the benefit of creditors, made to A. G. Langford, Esq. The immediate occasion of this is the return of drafts under protest, resulting from the failure of Messrs. Sewell, Ferris & Co. of New York, and the demand by the holders of these drafts, that they should be provided for at once. Duty to other' creditors, and especially to depositors, required that we should decline to sacrifice their interests to meet this demand We were thereby exposed to attachment, and deemed the course we have taken the only alternative. It is due to the public that we should state the primary and real cause of our disaster, involving as it does, a principle that precludes the possibility of any Bank of issue sustaining itself in this city, while doing a legitimate business, viz: the fact that a systematic run has been made with the bills of the Bank for gold and exchange from the day it opened. This run has been carried on chiefly by two Banking houses of this city. With an outstanding circulation of the bills of the Bank of the State and Nicollet County Bank, of but about Fifty Thousand dollars, these two firms have run in from ten to fifteen thousand dollars monthly. In view of the great scarcity of gold and eastern exchange that has existed, intelligent business men will not be surprised that the Bank has had to yield to this wanton run. It is only to be regretted that the Bank did not at the outset abandon the enterprise of adding capital and money facilities to the business of the city. It'is expected that the Stock securities of the Bank will protect bill-holders. Depositors have been preferred :-sums less than one hundred dollars to be paid first. The amount of deposits is but about nine thousand dollars. Depositors who hold drafts of the Bank are next protected, and lastly, all other creditors. There can be no loss to depositors, and their speedy payment may be confidently expected. N. P. LANGFORD, Cashier. St. Paul, Oct. 13th, 1859.

6. November 2, 1859 The River Falls Journal River Falls, WI
Article from The River Falls Journal, November 2, 1859

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The Bank of the State of Minnesota, at St. Paul, has suspeended, and its owners are responsible for the issues of the Niccollet County bank at St Peter.There are sufficient bonds deposited with the State Auditor to redeem the circulation at 201A

7. November 3, 1859 The Jeffersonian Stroudsburg, PA
Article from The Jeffersonian, November 3, 1859

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Minnesota Bank Fairure. Within a few days the "Bank of the State," st St. Paul, and the "Nicollet County Bank" have suspended, which has caused a panic in the State, affecting, as we learn from the Minnesotian, all Min. nesota currency by this suspension. The only bills seriously deteriorated are the Nicollet bills. The Bank of the State is based upon the security of Minnesota eight per cent. State bonds, and the bonds are convertible cash at par, in the city of New York, to redeem every dollar But the Nicollet bills are of the bills based on University Bonds, which are inconvertible.