CTt»-T>wBBr;n(i8iiir«'MKMW»wiii»Mi r2 "^K ^/ Cornell University Library The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://archive.org/details/cu31924032535753 > f^ w^~m^ ^^ ^ v iiC^ -^^-^m^j ^j^kssf iwMmf^^, Date Due V "' WL l-^-48S?-f f V ""tytjf 1 : A ' t II !*■%- tJW-^ ^^^gr'rW^ - <^^?> Cornell University Library S HG2613.P54 B15 ^ A history of the Bank of North America . >1 ■ ? 3r,"^<;aKaBs^j?£; \i- r n Or ft- A H 5^/ \t> ^t)t ^^m^^ p. 1 '. , .;4 /rv^^^^'^'l^ ^ i.U '(^5^^/A Q^^^-^i^c^c FOUNDER OF BANK NORTH AMERICA 1781 A HISTORY OF THE BANK OF NORTH AMERICA, THE ITPvST BANK CIIAETERED IN THE UNITED STATES. PRF.l'ARKD AT THE KEQFEST OF THE PRESIDENT AND DIRECTORS, 1!Y LAWRENCE LEWIS, Ji:. nil LADE LP III A : J. B. LIPTINCOTT & C (3. 18 8 2. r AJUi' ^ CORNELL UNIVERSITY LIBRARY^ PREFACE. The occurrence of the centennial anniversary of tlie in- corporation of the Bank of North America affords a fitting- opportunity to present to the puhlic an historical sketch of the origin and career of that venerable institution. Unlike most of the banks in this country, its early ainials abound in interesting features. It was the first bank char- tered in the United States. Organized at a very critical period of the Revolution, almost wholly from a j^ati'iotic desire to sustain the feeble credit of Congress, its first trans- actions are most intimately connected with the financial ojierations of tlie National Government. By its aid troops were levied, arms and ammiuiition obtained, supjjlies fur- nished to the patriot army, and the expenses of the various dejjartments of Government defrayed. Some of the most lirominent financiers of Revolutionary times were numbered among its directors or supporters. Nor were these the only distinguishing features which marked its early career. The granting of its charter by Congress first raised the question as to the existence of implied powers in that body. The annulling of its State li-anchises by the vote of the Assembly 4 PREFA CE. induced the first discussion as to the cajxicity of a legislative Ijody to take such action. While the jn^opriety of encour- aging or prohihiting the system of banking in this country was first mooted in connection with its operations. All these subjects will be found treated of at some length in the following pages. The later history of the l_)ank presents fewer points of interest to tlie general reader. To give an adequate idea of the scope and character of its operations the financial history of the nation would have to be passed in review, a gigantic task wldch yet remains to be performed, and which is, of course, quite beyond the limits of the present under- taking. No more has, therefore, been attempted than to sketch in rough outline those events in the history of the institution which seem l:)est calculated to illustrate the prin- cijdes and policy Ijy which it has been constantly guided. In some of, the important financial crises through which this nation has passed, the Bank of Xorth America has adopted a course diametrically opposed to that pursued by most of the l)ankino; institutions of the C(nuitrv. iVs a rule, the wisdom of the counsels b}^ whi(4i it was guided has l)ecn fully justified by tlie event. Of this no Ijetter proof can Ije required than its great and constant 2»ros2ierity. During the century of its existence it has never passed its semi-annual divianic unexampled in its magnitude and in tlie disastrous eft'ects it produced upon the communitv. Other features in the later liistory of the bank have seemed wortliv titution seems, however, to have been only the ordinary colonial loan-office under another name. 2 Holmes, Am. Ann., 82. THE BANK OF NORTH AMERICA. 15 now presented to the American mind. ComnTeree, 1775 it is true, liad almost jierished. Storeliouses were emptor, and sliips were rotting at tlie quays. But a national system of finance liad become a neces- sity. A national government was to be suj)ported, and a national army to be raised, paid, fed, and clothed. The various schemes of Congress to this end were badly planned and worse executed. It had resort to pajser money, to lotteries, and to loans both foreign and domestic, but by the close of 1779 1779 had almost come to the end of its resources. Its pajier money had already depreciated to below one-eighth of its par value, and was still rapidly on the decline, its lotteries proved so many gigan- tic bubbles, disa^^j^ointing alike to the government and the adventurers, and its credit seemed far too much exhausted to hope for further cash loans to any large extent. From these trying difficulties the genius of Alex- ander Hamilton conceived that the country might be rescued by a plan similar to that already j^ro- posed by Morris for its commercial aggrandizement. With characteristic energy he advised the imme- diate establishment of a vast banking institution, to be known as " The Company of the Bank of the United States," Avith a capital of two hundred mil- lions of dollars. He proposed that it should be incorporated by Congress for a term of ten years, 16 A HISTORY OF 1779 and that its capital sliould be devoted largely to relieving tlie government from its mortifying 1 Hamilton's Works, iiG. financial embarrassments. Tlie sclieme, however, was of far too vast a character to be jnit into practical shape. As far as can be ascertained it elicited but meagre atten- tion, and meantime the jiecuniary condition of the country went from l)ad to worse. 1780 The spring of the year 1780 was perhaps the most disastrous j^eriod of the American Revolu- tion. The credit of Congress, already stretched Dissertations to tlic vciy iittcrmost, had almost vanished. The on Govern- . ,. -r ^ c f ^ ^ ^ nient, tlie army was m great distress. Laclc ot tood, clothes, Aflairs of the ' ^ ^ c n i Bank, and and pay engendered irequent and dangerous mu- Money, Ly tiiiics. " The iiieasures of government, from the Thos. Paine. „ ' i t t i ti Phiiadei- want ol iiioncy, means, and credit, dragged on like a phia, 1786, . . iinm 17. heavy-ioadetL carriage witiKjut wheels. lo crown all, the reliance that had been placed in the de- fences of Charleston now failed. The effect of its anticipated loss on the spirits of the people was greatly dreaded. Already bitter complaints were being made to Congress of over-taxati(jn. " How the public measures were to be carried on, the country defended, and the army recruited, clothed, fed, and paid . . . was a matter too glooni}^ to Ibid., 18. look at." Many who had l>efore l_)een most con- lident now declared that they des})aired of a suc- cessful issue. Indeed, a genertil apathy and gloom seemed to settle on the national cause. THE BANK OF NORTH AMERICA. 17 It was under these distressino; circumstances that 1780 the first Ijanlcing institution of the country sprang into heing. A numl)er of patriotic gentlemen in Phihulelphia, who appreciated and deplored the national distress, resolved that from their private fortunes they would do something for the relief of the government. Prominent among these were Rohert ^Morris, Blair ]\IcClenachan, Thomas Wil- ling, John Nixon, James Wilson, George C'lymer, William Bingham, and a numljer of others whose names are associated alike with the hist(.)ry of the State and of the nation. ■ A meeting of citizens was accordingly called in the C'oflfee-House on June S, 1780, which was largely attended, and it was then and there re- solved that a suhscription should instantly he set on foot "to he given in bounties to promote the recruiting service of the United States." The suhscriptions rolled up rapidly. Within nine days there was raised no less a sum than four hundred pounds in hard money and one hundred and one thousand three hundred and sixty pounds in C ontinental money. While this subscription was going f >r'\vard in- formation of the loss of Charleston arrived. A few members of CJongress, who had obsei'ved the movement with interest, at once communicated to the gentlemen who were at the head of it the in- creased distress and danger to which the countrv 18 A HISTORY OF 1780 was now subjected, and urged that their benevo- lent scheme for the national good should be pressed beyond the limits originally intended. Accord- ingly, on June 17 another meeting was called of the original subscribers and of such other gentle- men as chose to attend, in the City Tavern, and it was resolved to abandon the original plan. In its place, it was proposed to open a security sub- scription to the amount of three hundred thousand Dissertations pounds Pennsylvania currency in real money, the on Govern- ment, the subscribers to execute bonds to the amount of their Aii'iurs of the Bank, various subscriptious, and the whole amount to and Paper Money, by form the Capital of a bank, by the aid of which Thos. Paine. . ^ ■' Phiiadei- it was 2>i'oposed to supply and transj)ort food to phia, 1786, 19 and 20. the army. The plan found ready acceptance. " Whereas, in the present situation of j^ublic affairs," ran the heading of the subscrijrtion-list, " tlie greatest and most vigorous exertions are necessary for the successful management of the just and necessary war in which we are engaged with Great Britain, we, the subscribers, deeply impi'essed with the sentiments that on such an occasion should govern us, in the j^i'osecution of a war on the event of which our, own freedom and that of our posterity, and the freedom and in- dependence of the United States, are all involved, — hereby severally jdedge our property and credit for the several sums specified and mentioned after our names, in order to sujiport the credit of a bank THE BANK OF NORTH AMERICA. 19 to Ix' cstablihihed for furnishing a supply of pro- visions for the armies of the United States." ^\^itliin a feAV days the suhscription-list was completed. It endjraced the names of all those who had subscriljed to the former undertaking and of many others, ninety-two in all, who pledged themselves for amounts which varied from one to ten thousand pounds.^ 1780 '1 Hazard's Historical Ken-ister,2G0. 1 Tlic fulluwing is the li trigctlier with the various Joseph Eeed Robert Morris Blair McCleuachaii .James "Wilson Georye Clynier William Bingham .J. 31. Nesljitt & Co Richard Peters Samuel 3Iereditb James Jlease Thomas Barcla)- Samuel IMorris, .Jr Join. Cox Roliert L. Hooper, Jr Hugh Shicll Benjamin Cr. Eyre William Coats Emanuel Eyre John Dunlap .Jam es Bu dden Cadwalader ilorris Bohert Bass Owen Biddle John Gibson t of subscribers to the Pennsylvania Bank, amounts eontriliuted liy them : £2,000 Michael Hillegas £4,000 10,000 Charles Pettit 2,000 10,000 John Mitchell 2,000 •:>,000 Matthew Irwin 5,000 5,000 Thomas Irwin 5,000 5,000 Jolm Philip de Haas 5,000 5,000 Philip Moore 5,000 5,000 Robert Knox 2,000 5,000 Joseph Bullock 2,000 5,000 John Nixon 5,000 5,000 Francis Gurney 2,000 5,000 George Campbell 2,000 5,000 5,000 5,000 1,000 4,000 William Lewis 2,000 Jolm Mease 4,000 John Wharton 2,000 Benjamin Rush 2,000 T. Lawrence 2,000 5,000 I Joseph Blower.. 4,000 4,000 2,500 2,000 2,000 2,000 2,000 John Pringle 3,000 Bunner, Murray & Co 0,000 Joseph Carson 4,000 Matthew Clarkson 2,000 William Hall 2,000 John Patton 2,000 20 A HISTORY OF 1780 2 Hazard's Historical Register, 257. An organization was at once effected under the name of the " Pennsylvania Bank." The sub- scribers agreed to pay in ten per cent, of their sub- scriptions at once, and the residue from time to time as it sliould be needed. Robert Morris, John M. Nesbitt, Blair McClenachan, Samuel Miles, and C'adwalader Morris were elected Insjiectors ; John Nixon and George Clynier, Directors ; and Tench Francis, Factor. The director's were authorized to borrow money on the credit of the bank for six months or for Thomas Lei per £4,000 Eobert Bridges 5,000 B. Fuller 2,000 B. Eandolph 2,000 Abraham Bickley 2,000 George Meade & Co 2,000 John Bcnezet 5,000 John Dunaklsoii 2,000 Henry Hill 5,000 John Morgan 5,000 Jolin Steinmetz 2,000 Samuel Miles 3,000 Samuel Mifflin 5,000 Thomas Mifflin 5,000 Andrew Hodge 2,000 Thomas Willing 5,000 Samuel Powel 5,000 Charles Thomson 3,000 Henry Kcppele 2,000 Francis C. Hassenclever... 2,000 Isaac Meleher 2,000 Isaac iloses 3,000 I John Schaffer £2,000 Alexander Tod 2,000 John Purviance 2,000 Kean & Nichols 4,000 John Wilcocks 2,000 Samuel Ingles 2,000 Jonathan Penrose 2,000 Nathaniel Falconer 2,000 James Caldwell 2,000 Samuel Caldwell 1,000 Samuel Penrose 1,000 William Turnbull 1,000 John Shee 1,000 Benjamin Davis 1,000 Sharp Delany 1,000 Samuel Morris 3,000 Andrew Dt>z 1,000 Gcrardus Clarkson 2,000 Peter Whiteside 1,000 Andrew Robeson 1,000 Abraham Shoemaker 2,000 ; Tench Francis 5,000 THE BANK OF NORTH AMERICA. 21 less time, and to emit notes Ijearing interest at 1780 the rate of six per cent. Tliey ^vere to ajitjily all money borrowed or received from Congress for tlie sole purpose of purchasing provisions and rum for the use of the Continental army, to transjiorta- tion, and to discharging the notes and expenses of the bank. Congress ^vas expected from time to time to reimburse the bank for the amounts ex- })ended, and Avhen the 'whole amount laid out sh(juld have been tluis returned, the notes were to be paid off and cancelled, the accounts settled, and the l)ank wound up. (_)n June 21 Congress was officialh' advised of the organization of the institution, and that it now , , , , , . . , . [. .Journal of lacked only the recognition and co-operation ol Congress, , , , . . . T .June 21, that body. A committee was at once appomtecL 1780. to confer with the subscril)crs, and so satisfactory was its report that the fidlowing resolutions were at once unanimously agreed to : Resolved, That Congress entertain a high sense of the lil;)eral oft'er of the association to raise and transport sujiplies, and that it accejits the same as a distinguished proof of the patriotism of the sub- scribers ; and Hesolred, That tlie laith of the United States be pledged t(j the suljscribers for their eft'ectual reim- bursement in the premises, that Ijills of exchange to the amount of £15,000 be deposited with the bank, and that, if it should occasionally need 22 A HISTORY OF 1780 assistance, Congress will advance as miicli of 8 Smith's the current funds as can be spared from other Laws, 38e, note. services. On July 17 the bank began its operati(jns. It was established on Front Street, two doors above Walnut, and, if we may judge from the advertise- ments of the time, did a fair share of l)usiness. "All persons who have already lent money," runs the notice in the jtaj^ers of the day, " are de- sired to apply for bank-notes, and the Directors request the favor of those who may hereafter lodge their cash in the bank that they would tie it up in bundles (.)f bills of one denomination, with labels, their names indorsed, as the business will thereby be done with less trouble and greater des2)atcli." The bank hours were from nine in the morning until noon, and again from three until five in the afternoon. For nearly a. year and a half the Pennsylva- nia Bank remained open. The factor drew from tinie to time on the directors for specie, for Penn- sylvania State monejr, or for Continental money, as he had need. These sums he invested in flour, beef, pork, sugar, coffee, salt, and other goods, which he stored in large (piantities, and from time to time forwarded t<_» the army. Three millions of rations were provided in this way, besides three hundred barrels of rum. It was thought that these su2)plies could not have been obtained but THE BANK OF NORTH AMERICA. 23 for the assistance of the Lank, so that it was uni- 1780 versally esteemed as haviu"; been of most essential ^ Hazard's •^ *= Historical service to the country. Kcgister, . . 257. The tenth and last instalment of the subscrij:)- tions was called in on Novemljer lo, 1780, and the Peiinsj'lva- bank's affairs finally wound up t(jwards the close nia Gazette, December 29, of the year 1784. i784. 24 A HISTORY OF CHAPTEE 11. 1V81. Financial Condition of the Country in 1781 — Ratification of tlie Articles of Confederation in March, 1781 — Appointment of Robert Morris as Superintendent of Finance in February, 1781 — Morris's Plan for a National Bank — Action of Con- gress in Reference thereto — Reasons for establishing a Na- tional Bank — The Subscriptions to the Undertaking — The Organization of the Bank of North America in November, 1781 — Thomas Willing elected President — The Ordinance of Incorporation passed by Congress December 31, 1781. The year 1781 opened witli prospects wliicli were gloomy indeed to coutemplate. In January a large \YAxi of the American arni}^ quartered at Morristown mutinied for lack of pay, declared their intention of departing to their homes, and Debates and were Only restrained from carrying their threat Proceedings ■ "- of the Gen- into cxecutioii by the iiersoual intluence and solici- eral Assem- bly of Pen]i- tation of the commander-in-chief. Congress de- sylvania on ^ tile Memo- spaircd (jf raising sufficient suinilies. One delegate rials praj'ing " a Repeal or from Virginia seriously pro].)<:)sed that General Suspension _ of th(! Law Washington should l»e authorized to lay violent annulling the Charter of the Bank. Matthew Carey, Edi- tor. Phiia- B(jard of War declared thev had not the means of delphia, _ -.''.. 178G, 47. sending an express from Philadelphia to the army. hands u])Oii all the provisions that could he found within twenty miles of his camp. Memhei's of the THE BANK OF NORTH AMERICA. 25 Continental money liad fallen to al)ont one per 1781 cent, of it8 ym value, and witliin four months of the beginning of tlie year had begun altogether to lose its purchasing power. " The Congress is finally bankru2)t," said a Tory paper of May, 1781. " Last night a large body of the inhabitants, with paper dollars in their hats by way of cockades, l^araded the streets of Philadelphia, carrying colors flying, with a dog tarred, and, instead of the usual a2:)pendage and oi'nament of featliei's, his l)ack was covered with the Congress paper dollars. . . . This example was directly fdlowed by the jailer, who refused accepting the bills in purchase of a glass of I'um, and afterwards by the traders of the city, who shut up their shops, declining to sell any more Rivington's goods but for gold and silver. i:)_ i7gi. But as the year went on there was a decided improvement in the complexion of public af- fairs. On the 1st of March the Articles of Confedera- tion were finally ratified, and, however imperfect in their structure, certainly established more defi- nite relations than had formerly existed among the States. By them all charges of war, and other ex- jienses incurred for the common defence and safety, were made payable out of a common treasury, and Congress was given express power to Ijorrow money and emit bills of credit, all debts so contracted being deemed a charge against the United States 26 A HISTORY OF 1781 for the payment of wliieli thej and tlie public faitli Avere pledged. Hardly less important was the election by Con- Journal of ' . ^^ . , « -,-,. Cono:ress, o-ress of Robert Morris as Superintendent of li- Pebruary 20, 1781. nance on the 20th of February, 1781. Wearied at last by the endless mistakes and delays of the boards and committees who had had the control of the finances, Congress at last resolved to com- mit them to the management of a single responsi- ble head. It was universally conceded that they had acted most wisely in preferring Morris to the post. Full of energy and self-reliance, he was, perhaps, Ijy his business talents and mercantile experience, better c|ualified than any man in Amer- ica to control and direct its financial affairs. He thought no sacrifice too great to be made for the service of his country. Possessed of a splendid jiersonal credit, he often racked it to the utter- most to carry on some favorite national 2)roject. He spared neither labor, time, nor thought, and, whatever strictures may be made on his manage- ment of the national treasury, it must be confessed that it was characterized hy a consistency and vigor which the country had not before witnessed. Letter, Alex- tt -i i i • ander Ham- Hamilton toolc au early occasion to congratulate ilton to Hob- t. r ■ i • crt Monis, Moms Oil iiis ap2)ointnient, and at once urged on April 30, ,.,.,. „ . 1 T 1 1781, 1 iiani- limi the advisability of j^roposmg the establisliment Works, 22.3. of a national bank. This, according to his views, should have a capital of at least three millions of THE BANK OF NORTH AMERICA. 27 dollars, and be carried on in close relations witli 1781 the national government. Morris was the more ready to comply with this suggestion because it coincided to a great degree with his own convictions. He felt persuaded that the establishment of a national bank could not but be of great service both to the government and to conmierce, but he was unwilling to enabark in an undertaking of such magnitude as had been con- ceived by the daring mind of Hamilton. He drew uj), therefore, a scheme on a scale which he felt to be adequate to the national Avants and certain to secure pojiular apjirobation, and on the 17th of ]\Iay, 1781, presented to Congress his plan for the establishment of the Bank of North America. The details of this \A.'A\\ were sufficiently simple. A subscription of four hundred thousand dollars was to be raised, in shares of four hundred dollars each, payable in gold or silver. Every sul^scriber ^ of five shares or upwards was to undertake to j^^iy one-half the sum on the day of his subscrijrtion and the other half within three months of that date. When the whole sum was made uj:), a sys- tematic organization was to be efiected. Twelve directors were to be chosen annually to regulate the affairs of the bank, none of whom were to re- ceive any comjiensation for their services except by consent of the stockholders. These were in turn annually to elect one of their number as presi- 28 -4 HISTORY OF 1781 dent, and quarterly to elect two of their number as insjiectors, to control the affairs of the bank. The shares were to be freely transferaljle, and the di- rectors were to Ije at liljerty to open new subscrip- tions to the capital stock as often and upon such terms as they should see proper. The bank was to be distinctively a national institution. On every evening, Sundaj^ exce2)ted, the inspectors were to deliver to the Superintendent of Finance an accu- rate account of the day's business, and it was un- derstood that at all times he should have full right to examine into its afiairs. Its liank-notes, i^a}'- able on demand, were l)y law to be made receivable for duties and taxes in every State in the Union, and were to be deemed in the settlement of accounts Ijetween the States and the United States as specie. Other regulations were to l:)e made relating to the conduct of its affairs, which, being of minor im- portance, need not here be recapitulated. The matter was deemed by Congress of great importance, and was at once referred to a special Journal of . . > • i • Congress, committce ot lour, With instructions to rejiort on May 17, , ,. -i •!• i^ ^ i ri-n • iTS'i. the leasihility ot the scheme, lliis committee con- sisted r)f Witherspoon of New Jersey, Sullivan of New Hampshire, M. Smith of Virginia, and Clymer of Uennsylvania. On ]\Iay 2(.') it reported in favor of the ado])tion of the plan. Resolutions were at once introduced in consonance with its recom- mendations, and a lively deljate ensued. The THE BANK OF NORTH AMERICA. 29 ])roiuoters of the bank used every argument which 1781 a thorijugh Ijelief in its usefubiess eoukl inspire. Madison, on the contrary, was bitterly opposecL He contenik'd that Congress was quite overstep- ,. „ C i J- G Bancroft s ping its powers in idedoina; itself to establish a ?'*tt'-^-"'i -'-"-'- J- JD o the United banking institution, and there were others who ?''^":\(^*^".' ~ ' tennial Edi- coincided with him in opinion. \,\m\), 463. When at length the vote was taken the resolu- tions were found to have been passed by a Ijare majority only. New Hampshire, New Jersey, Maryland, Virginia, North Carolina, South Caro- lina, and Cieorgia voted aye. Rhode Island and C(ninecticut were insufficiently rej^resented. Penn- sylvania Avas divided, Mr. T. Smith voting no and Mr. C'lymer voting aye. JMassachusetts alone was registered in the negative. The f(.)llowing are the resolutions in question : Ilcmlvvd, That Congress do apjjrove of the plan for establishing a national bank in these United States, submitted l)y Mr. Robert Morris the 17th Mtiy, 1781, and that they will promote and sup- port the same by such ways and means from time to time as may ajjpear necessary for the institution and consistent with the public good. Resolved, That the subscribers to the said bank shall be incorporated agreeably to the princijdes and terms of the plan, under the name of the President, Directors, and Company of the Bank of North America, so soon as the subscription 30 A HISTORY OF 1781 shall be filled, the directors and president chosen, and ai^iilication made to Congress for that purj^ose by the president and directors elected. Resolved, That it be recommended to the several States, by prij^ier laws for that pur2)ose, to j^rovide that no other Bank or Bankers shall be established or })eriuitted within the said States resj^ectively during the war. Bemlred, That the notes hereafter to be issued by the said bank, payable on demand, shall be re- ceivable in payment of all taxes, duties, and debts due, or that may become due and payable to the United States. Resolved, That Congress will recommend to the several Legislatures to pass laws }naking it felony without benefit of clergy, for any person to counter- feit bank-notes, or to j^uss such notes, knowing them to be counterfeited; also making it felony with- out benefit of clergy, for any president, insjicctor, director, officer, or servant of the bank to convert any of the property, money, or credit of the said Ija.nk to his own use, or in any other way to be .Journal of . ,. ,. i i i r.- Conirress, guiity ot traud Or embezzlement, as oincers or ser- ^'''y< / p.i 1 1 1781. vants or the bank. The plan being apjiroved by Congress, the Su- perintendent of Finance, on May 28, published it to the world, acc(Mnpanied by an address, in which he set forth the necessity and prudence of the measure. "To ask," said he, "the end which it THE BANK OF NORTH AMERICA. 31 is jn'oposcd to answer by this institution of a bank, 1781 is merel}' to call the puljlic attention to tlie situation of our affaii's. A depreciating paper currency has unhap^oily been the source of infinite private mis- chief, nunil)erless frauds, and the greatest distress. The national calamities have UKjved witli an efj[ual pace, and the puljlic credit has received the deej^est injury. This is a circumstance so unusual in a re- publican gijvernment that we inay boldly affirm it cannot continue a moment after the several Legis- latures have determined to take tliose vigorous and effectual measures to whicli the pul)Hc voice now loudly commands their attention. Jn the mean time the exigencies of the United States require an antici2)ation of our revenue ; while, at the same time, there is not such confidence established as will call out, for that purpose, the funds of indi- vidual citizens. The use, then, of a bank is to aid the government by their moneys and credit, for which they will have every projier reward and security, to gain from individuals tliat credit which 25roperty, abilities, and integrity never tailed to connnand, to supply the loss of that paper money which, becoming more and more useless, calls every day more loudly for its final redemption, and to give a new S2)ring to commerce, in the moment when, on the removal of all its restrictions, the Facts Re- specting the citizens of America shall enjoy and possess that Bank <.f North Anier- freedom for which thev contend." ica, i. 32 A HISTORY OF 1781 The subscriptions meanwliile mounted ujt slowly. Morris sought, but for the most part in vain, to in- Greene to terest the citizens of other States m the enter2:»rise. Morris, Au- . gust 18, 1781. In the South particularly he made strenuous efforts, Greene's Life f n -it i i • i of Greene, but few wcrc fouud Willing to embark m the under- vol. iii. p. 370. taking. " The jirospect of j^rofit was very remote, the danger of a total loss of capital evident. The Facts Ee- couutrv was engaged in an arduous and doubtful specting the . , Bank o? couflict. If unsucccssful, the whole capital was Nortli Aiiier- ica, 7, lost." Another serious disaji^iointment about this time occurred to the Superintendent of Finance. He had, in establishing the bank, relied largely for a supply of coin upon the Governor-General of Havana, who was to have been repaid liy annual shi^iments of flour, guaranteed by the French Boiies' Fi- Crown. Tliis negotiation, unfortunately, at the naneial His- tory of the critical moment broke down, and Morris found United states, 273. himsclf uiiable to render the bank the expected aid. In spite of all difficulties, however, the subscrip- tion-list began, by the fall of 1781, to jiresent a very respectable apjiearance. The gentlemen Avho had been most prominent in the organization of the Dissertations Pennsylvania Bank became identified at once with on Govern- ment, the the fortunes of the new institution. Thev readilv Affairs of the . . ^ . J J Bank and perccivcd that, if successful, it would render useless Paper MoTiev, bv the continuance of the old undertakino-. Thev re- Thos. Paine. . ° •' Phihidei- solvcd, therefore, at once to wind uii the latter's pliia, 1780, '.20. affairs, and in many instances transferred their THE BANK OF NORTH AMERICA. 33 subscriptions from its Ijooks into those of the Bank of North America. Other citizens of Philadelphia and its neighbor- hood, and a few of other parts of the conntry, came forward, and l)y October or Xovemljer it was found that there had been paid in cash about |70,000. About this time a French frigate arrived in Bos- ton, bringing to the national treasury a most op- portune remittance of about !|47(J,()00 in specie. This sum was immediately brought to Philadel- phia and lodged in the vaults of the bank ; and so assured did the stockh(jlders now feel of ultimate success in their undertaking that they resolved at once to take stejis for organization. On November 1, 1781, a meeting was convened at the Oity Tavern.^ A nund^er of the same ^ At this iiiueting' tlje folUiwinij; persons were present : 1781 Considera- tion? on the Bank of North Anier- iea. Phila- delphia, ivsn, 5. Debates and Proceedings of the Gen- eral Asseni- hly of Penn- sylvania on the Menin- rials praying a Kcpeal or Suspension of the Law annulling the Charter of the Bank. Matthew Carey, Edi- tor. Phila- del]ihia, 178U, 48. G>au:'r MurrU. James Cravforil. Chas. Pettit. Jlichael Hillegas. S(nnu(d Osgood. B. Fuller. Samuel Meredith, for George Clymer. Wm. Turnbull. John Wileocks. Jno. Mitchell. Samuel Meredith. Mease & Caldwell. JijIiH Dunnaldson. Of these, all but nine, indicated by italics, were subscribers to the Pennsylvania Bank. James "Wilson. John Nixon. Tlmuihy I\Iatlack. And". & James Caldwel Eobt. 3Iorris. Francis Gurney. Geo. Meade & Co. Thos. Fitzsimons. Tlius. FHzslmo)is, for Geo. Meade. George Haynes. David H. Coriyngliam. J. Ross. Directors' Minutes, November 2, 1781. 34 A HISTORY OF 1781 Directors' Minutes, November 2, 1781. Directors' Minutes, November 26, 1781. Lives of Eminent Philadel- phians now Deceased. Tit. "Thom- as WillinE;." gentlemen who liad controlled the affairs of the Pennsylvania Bank were called upon to assume the management of the new national enterprise. The following was the board of directors chosen: Thomas Willing, Thomas Fitzsimons, John Max- well ISTesbitt, James Wilson, Henry Hill, Samuel Osgood, Cadwalader Morris, Andrew Caldwell, Samuel Ingles, Samuel Meredith, William Bing- ham, and Timothy Matlack. At a meeting of the board held the following day Thomas Willing was elected as president, and, a few days after, Tench Francis as cashier. Mr. Willing was, from his social position, busi- ness talents, and political experience, well rpialified to fill the resj)onsible position to which he was now called. He was to be reckoned, undoubtedly, as a leading man in the State, if not in the country at large. Born on the 19th of December, 1731, he was now, at the age of fifty, in the very prime of his powers. He was a partner of Kobert Morris in a large and jn-osjierous business, and had served successively as Secretary to the Congress of Dele- gates at Albany, Judge of the Supreme Court of Pennsylvania, Mayor of Philadelphia, Member of the Colonial Assembly, and President of the Pro- vincial Congress. Pie was afterwards chosen as a delegate to Congress under the Confederation and as first j)i'esident of the Bank of the United States. " His character," says Mr. Binney, " was not — = = ^„ffi '1 „ ,, £ m 1 , wJf ~ ^^M ^ ^Jr' , * ^,^^^^^:^^^^^^^S; •■^jIm! jUj 5 H -Jy . ^^^^1 ^ ^^^ MfeiMM I^K' 'SA'itipjA. <^ -■-^ -s^^Hiiil^^fl BRx **^^S^^^Sm. *^ ^'^^^I^HhI Hnr''-^ Mfc^y . ^i^^^^S^B^K '^''^'c^MMiiil^ sSHH^I^^^^H r^^^^^^HBL '^^^SIhH^^^I ■MB^^^^^^ " "'^' '^^^^mB^IBNhhmhI^^^hI^^^I H^^^^^ ^"^^^^^^Si^^^^^^HSaBHHH B^^' ''^^^a^^^^^^^^^^K ^^^^^^H^^^^l ^H^^^^ '^•-^^Pis^s^S^^^^^^ ^>«^^hI^^^^^I ^^^^^^^^. '^^SH^I^^H I^B -^i@^^^^^^^^^^^^^i^^^i H^^^^^ ■'iSxn^Ss^tl^^^K^^K^t^^^^^^^M^^^^ H^l^^^^^^ ^^^^ ^BH8BSBSr''V . '-sj^ ^^^M, '^^^^^^sS^^^^EI^^B^^^S^^^^^^^^tB^^^^^^^^mL Haag^iP' ^t*-'? ^^^fk ^ iS^^-j-**' ' -^ '' ^ 1 '^^s!^^^^^i^^9^^^^iH^S^^^@^3^^S <- ] \i ' ' -" vl^^^^^^^^^^^^^.w^^'^y 1 '/• <^ :^ ^1 ch ^ PRESIDENT OF THE BANK OF NORTH AMERICA I782--I79I. THE BANK OF NORTH AMERICA. 35 unlike that of "Washiiigton, and, in the diseretion 1781 of liis eonduet, the fidelity of his 2>rofe88ions, and the great influence, hoth puhlic and private, which belonged to him, the destined leader (Washington) was certain to find the elements of an affinity l>y which they would he united in the closest man- The Eepub- ner. iJiis excellent man, he says agaui, " ni loi. all the relations of iirivatc life, and in various sta- Inscripfion tions of high ])ublic trust, deserved and acquired "P"" i"s '^ -"■ tombstone, the devoted afi^ection of his family and friends, and written by Horace Bin- the universal resj^ect of his fellow-citizens." "«>'. Ksq. After this ha2:)py choice the affairs of the bank rapidly jorogressed. By December $85,000 in t2ish had Ijeen raised, exclusive of the amount of the government deposit, and, although the sub- scrijition was far from complete, it was resolved to apply to Congress for a charter of incorporation. The measure was introduced, but was not passed ^ 6 Bancroft's without some opposition. The opinion luid come Historj' of ^^ _ ^ ^ ^ the United to be laro'cly entertained that the Confederation states (Cen- ^ •' _ tennial Edi- contained no power to incorporate a bank. Con- lion), 4i_i.3. gress, however, had already pledged its word. (Some concessions were made ti.i the scru[)lcs of the opjiosition, and on December ol, 17S1, an ordinance \v;is finally passed perpetutilly incor- 2)orating the subscribers by the ntime and style of " The President, Directors, and Comjtany (jf the Bank of Xorth America." This ordinance dis- tinctlv recoiiuized the fact that the exii^encies of 36 A HISTORY OF 1781 the United States rendered it indispensably neces- sary tliat sueli an institution sliould be called into being ; it conferred tlie ordinary corporate powers, among them the riglit to hold property to the value of ten millions of dollars ; it recognized the officers already chosen as duly and j^i'Oj^erly elected, and declared that everything therein contained should " be construed and taken most favorably and bene- ficially for the said corporation." A clause was introduced forbidding the bank to exercise any powers in any of the States repugnant to the laws thereof, a provision with which the opi^onents of the measure declared themselves well satisfied. As a further concession to their preju- dices, it was agreed that a sujjplementary resolu- tion should l^e passed recommending to the several States t(j give full force and effect to the incor- porating ordinance. This was peculiarly agree- al^le to ]Madison, who regarded the retpusition as Congress" a tacit admissiou by Congress of their defect of December 31, 1781. power. THE BANK OF NORTH AMERICA. 37 CHAPTER III. 1782-1784. The Bank of North America begins its Operations on Januarj' 7, 1782 — Circular Letter of tlie Superintendent of Finance an- nouncing tliis Fact to the Governors of the various States — Early Difficulties experienced by tlie Banl;: — Stories relating to it circulated by its Enemies — Rapid Success of tlie Insti- tution — Recognition of its Existence by Connecticut, Rhode Island, and Massachusetts in January and jMarch, 1782 — A Charter granted to it by the Assembly of Pennsylvania on March 2C, 1782 — Opposition to Mr. Willing on Account of alleged Disloyalty — Assistance afforded by the Bank to the Kational Government — Assistance afforded by it to the State of Pennsylvania — Assistance afforded by it to the City of Philadelphia — Proposed Establishment of the Bank of Penn- sylvania in 1784 — Abandonment of the Sclieme in Conse- quence of the Increase in the Capital Stock of the Bank of North America — Subscriptions to the New Stock. On" the 7tll of January, 1782, tlie Bank of Considera- tions on the Nortli America began active operations. Its busi- Bank of North Anier- ness was conducted in a commodious store belong- ica. Phila- delphia, ino- to its cashier, Tench Francis, situate on the 1785, 29. north side of Ghestnut Street, a short distance Directors' west of Third, which had previously been leased Minutes, . "^ November and fitted up for its accommodation. In these 20, i78i. ' The bank subsequently purchased the lot and buildings thereon. The following is an abstract of the title : 5 A HISTORY OF 1782 quarters the bank continued its ojDerations for up- wards of sixty-five years. ^ Tench Francis et u:c to John Wilson, May 24, 1792. (See Deed Bool;, No. 30, page 105, etc.) John Wilson et ux to Mordecai Lewis, Mievs Fisher, and Eohert Wain, as Trnstees for the Bank, December 20, 1793. (See Deed Book, No. 40, page 522, etc.) Bobert Wain, surviving Trnstee, ei ux to The President, Directors, and Company of the Bank of North America, February 3, 1821. (See Deed Book F. W., No. 9, page 198, etc.) ' The following is a description of the Banking House as it appeared on December 3, 1839, taken from a survey made that day bj' the sur- veyor of the " Philadelphia Contributionship" : "The Bank of North America, situate on the north side of Chesnut Street, west of and near Third Street, being 38 feet front by 45 feet deep, three stories high, exclusive of an octagon back, one story high, 18 and 9 inch walls. The lower story is one main room, with three small apartments, divided off by a boarding about four feet high, with turned ballusters on the top, for the use of the President, Cashier, and a discount-room, and a counter in the middle nearly the length of the main room ; a girder under the second floor supported by three turn'd columns; a large vault on the west side of the room three stories high, with iron doors opening into it in each story, and a small fire-proof in two of the small rooms above mentioned ; . . . single architraves and mouldings to the windows; a vestibule inside the front door, with folding sash-doors hung in it; glass, 13 by 19 inches; outside shutters front and back; two pilain marble mantels in the lower story. "The second story is divided into four rooms and passage; . . . base and surbase round ; double ajid single architraves to the doors and windows; two marble mantels, with open pilasters; recess closets; glass, 13 b}' 19 inches, panncl'd inside; shutters front and back and outside do. to the back windows. " The third story in four rooms and passage, . . . plain base and surbase round ; single architraves and mouldings; glass, in front, 13 by 27 inches ; back, 9 by 11 ; i)lain stairs, with windows in the lower THE BANK OF NORTH AMERICA. 39 The bank hours were from ten in tlie morning 1782 until one in the afternoon, and a^ain from tliree Directors' in tlie afternoon until live. November 5, 1782. The regular employes of the hank were only .six in number, — the cashier, the teller, the sub-teller, the accomptant, the clerk, and the })orter. They received very inconsiderable salaries, — tlie cashier but $1000 a year, the porter but |160. The ac- counts "svere all kept in Mexican dollars and nine- tieth parts thereof. Directors' meetings \Yere held every Thursday, and two members of the board were chosen monthly to inspect and contr(jl the aft'airs of the bank. The institution being now fairly under way, the Superintendent of Finance issued the following circular letter announcing the fact to the gov- ernors of the various States : Offipg of Finamck, .January 8th, 1782. Sui, — I have tlie honor to transmit herewith an ordinance passed hy tlic United States, in Congress assembled, the thirty-first day of December, 1781, incorporating the subscribers to the Bank of North America, together with sundry resolutions, recommending to the several States to pass such Laws as they may judge neces- sary for giving the said ordinance its full operation. The reso- corner leading from the lower to the third story; garret plastered, and plain sk3'-liglit in the roof. "Old-fashioned wooden caves; tlie front dentil, back jibiin ; roof covered with copper, and copper pipes down ; the cellar floored with brick, and two furnaces therein, which appear to he safely con- structed." 40 A HISTORY OF 1782 lutions of the 26th May last speak so clearly to the points neces- sary to be established by these Laws, that I need not enlarge on them. Should anything more be found necessary upon expe- rience, the President and Directors will, no doubt, make suitable application to Congress, or to the States respectively, as the case may require. It affords me great satisfaction to inform your Excellency that this Bank commenced its operations yesterday, and I am confident that, with piroper management, it will answer the most sanguine expectations of those who befriend the Insti- tution. It will facilitate the management of the Finances of the United States. The several States may, when their respective necessities require, and the abilities of the Bank will permit, derive occasional advantage and accommodation from it. It will afford to the individuals of all the States a medium for their intercourse with each other and for the payment of Taxes, more convenient than the precious metals, and equally safe. It will have a tendency to increase both the internal and external Commerce of North America, and, undoubtedly, will be infinitely useful to all the Traders of every State in the Union, provided, as I have already said, it is conducted on the principles of ecjuity, justice, prudence, and economy. The present Directors bear characters that cannot fail to inspire confidence, and, as the corporation is amenable to the Laws, power can neither sanctify any improper conduct nor protect the guilty. Under a full conviction of these things, I flatter myself that I shall stand excused for recom- mending in the strongest manner this well-meant plan to all the encouragement and protection which your State can give consistently with Wisdom and Justice. I have the honor to be, with great respect, • Your Excellency's most obedient & 9 Pennsylva- Most h'ble serv't, nia Archives, 477. Hob't Morris. THE BANK OF NORTH AMERICA. 41 The first oj)erations of the hank were attended 1782 with considerahle difficuhy. Morris, in order to Detates and Proceedings streno;then its position as far as possible, snb- "f the Gen- scrihed, on account of the United States, what re- biy of Penn- sylvania on mained of tlie specie lately arrived from France, the Memo- rials praying With the utmost care and caution he had only a Kepeai'or Suspension of been able to retain about $254,000 of this sum, the Law an- nulling the and this amount enabled him to buy in for the Charte^r of •^ the Bank. national treasury 633 shares of bank stock. But Jiatthew Carey, Edi- what he thus paid in with one hand he may be tor. "Phila- delphia, said to have drawn out with the other. Within i786, 48. a very short j^eriod the great necessities of the C(juntry ol:)liged him to borrow from the bank amounts far exceeding the sum subscribed, so ofiBciai Ac- counts of the that the institution had little benefit from it as United states from 1781 to a means of establishing its credit. Nor was the 1784. whole amount of the individual subscriptions yet paid in, owing to the great scarcity of money. As a consequence, the amount of specie in the vaults at times dwindled to an alarming extent, and so great were the fears of an early exhaustion of this sum, that at critical j)eriods men were regu- larly employed to follow those who demanded BoUes' Pi- ■> ^ -i ^ ^ naneial His- specie and urge them to return it in order to tory of the ^ ^ _ _ United j^reserve the j^recious foundation. states, 273. In addition to all this, it was found that the notes of the bank would not readily circulate. Army contractors, when j^aid in this way, almost invariably carried the bills to collectors, and got 42 A HISTORY OF 1782 Letter, Alex- ander Hiun- iltou to Kub- ert Morris, September 21, 1782. Hamilton's Works, vol. i. p. 308. Bolles' Fi- nancial His- tory of the United States, 273. Gouge's His- tory of Paper Money and Bankincf, 35. tlie amount in sj^^^ie. In New England, the people, fresli from tlie recollection of Continen- tal money, were very Ljatli to receive the bank issues at all, so that they circulated at from ten to fifteen per cent, below par. Stories were cur- rent, and actually believed, that the bank made a show of far greater wealth than it actually pos- sessed. " Gentlemen interested in the institution," it was said, " were in the habit of requesting j)eo- ple from the country and laboring men about town to go to the bank and get silver in exchange for notes. When they went on this errand of neighborly kindness, as they thought it, they found a display of silver on the counter, and men employed in raising boxes containing silver, or supposed to contain silver, from the cellar to the banking-room, or lowering them from the banking- room into the cellar," by which contrivances they were induced to believe that the bank was pos- sessed of immense ^vealth. But all difticulties were soon overcome. A con- siderable sum in specie arrived from Euroj^e and the West Indies, and little by little the amounts Hul)scribed l)y individuals to the capital stock were paid into the treasury. The deposits gradually rolled up. ftlorris, by skilful management, pre- vented further issues from floating into that j^art of the country where they were badly received. The dei^reciation was quickly checked. Bank- Stockhold- ers' Minutes, NoYoiiiber 4, THE BANK OF NORTH AMERICA. 43 liills rose to their par value, and were there sus- 1782 tained without f'urtlier troul)le. Tlie directors felt BoUes' Fi- „ , 1 p iianeial His- every reason tor encouragement, a g'eneral conti- tory of the , 1 1 1 r' • IT United dence succeeded to the tormer mistrust, and by states, 274. Novemher the stockholders were able to congratu- late the officers upon " the skill and attention they had manifested in arranging an institution alto- gether new in America, the good effects of which,' they declared, "the puldic had already experi enced. ''■- ]\Ieantime, in spite of the early difHculties of the bank, some of the States had not been liackward in acknowledging its existence. On January 10 the Assembly of Connecticut passed an act declaring that the bank's notes should Ijc receivable in payment of all taxes due the State. About the same time the Assembly of Ilhode Island passed a law for the punishment of those who might counterfeit its notes or em- bezzle its funds, and on ]\Iarch ly that the president of the bank, Mr. Willing, had not at one period mani- ibid., „ . , . . 1-1 • 1 ^liircli 20, tested sutncient zeal ni tlie national cause. i782. While the British were in possession of Phila- delphia in 1777, 8ir William Howe despatched . from time to time messengers charged with secret offers to the various members of Congress, with the liojie of inducing them to conclude a peaoe on s(jme other basis than that of independence. Among those who were thus sent out was one John Brown, who had the misfortune to be ar- rested Ijy the American tr(jops, and was by reso- lution of Congress brought before the Pennsylvania ,-. -1 p rt /-• TT 1 • ■ ■ 1 (• ilinutcs of („ ouncil ot batety. L pon Jns examination belore the Couiuii 1 111 11 11 1111 '1 1*-'^' S^^f^tv, that Ijody he declareil that he had been mducecl ^'ovember 21 1 1 • 1 1 1 • 1 ■ (1 1 11 ^""^ 22, 1777. to embark 111 the undertaking clnetiy through the 11 Coiuniai solicitations (tf ]Mr. M^illing. This story now af- 347. forded ground to some of the bitter Whigs in the House to refuse their assent to the confirmation of jMr. Willing in his office. They wished to have G 46 A HISTORY OF 1782 the whole chiuse nominating the officers stricken out, and accordingly made a motion to that effect. " We consider it," said they, " highly imj)olitic and unjust to recognize and establish hy an act of the Legislature in so eminent and honorable a station the man who not only abandoned the cause of our country in the hour of our deej^est distress and calamity, but whilst the British army was in Philadelphia actually suffered himself to be em- ployed by them as the instrument and agent of their insidious attempts to deljauch the minds of the people, and even to reduce our public councils into submission. We think that loading with honors a ]nan who so lately did what he could to enslave this country is a discouragement to the Whigs, is a Avound to the cause of patriotism, and is trampling on the blood of those heroes and Assembly, martyrs who have fallen in defence of our March 2(;, ,., ,, 1782. lilx'rty. Kotwithstanding all opposition, the bill at length jiassed in its original shape. A desperate effort was subsetpiently made to reserve to the Assembly, in 178U, a. right to withdraw the pi'ivileges they Ibid., April . . c i i i [■ •^ ^ mi 1 1 1, 1781'. iiad conteri-ed, but tiie attempt failed, ilie baniv accepted the new charter, and continued its oj^era- tions as an institution duly incorporated under the laws of Pennsylvania. The advantages derived from the establishment of the bank soon answered the most sanguine ex- THE BANK OF NORTH AMERICA. 47 pectations of its projector. In a wonderfully short 1T82 time it restored confidence and credit, at least in some degree, to the commercial world. jSTor was the assistance which it was enabled to afford the Government less valuable. In the beo'innino- of O o the year 1782 the United States owed consider- able sums of money. The requisitions made by Congress for the exjjcnses of the coming yeai- amounted to eight millions of dollars. But the Detates una States were not called on to pay this sum until of the Geir- the 1st of April, and, as a matter of fact, the re- biv of Pemi- cpiisitions produced so little effect that l)y tlie end tiie Memu- of June not more than $30,000 had l)een i-aised. u'liepeaNj"'" At that period, says the Supermtendent ot li- the Law an- nance, "the pul)lic credit had gone to wreck, and chaitw of the enemy liuilt their most sanguine hojjes of Matthew overcoming us upon this circumstance, Ijut at f,,'r,'^" phUa- this crisis our credit was restored by the bank." i786,"49. The aid afforded to the Government by actual cash advances was alone verv considerable. Durino- January, February, and March of 1782 the l^auk loaned for this purpose, in all, the sum of $300,000. By July 1 1100,000 more had Ijccu advanced, making a total of $400,000 during the year. Nor ihid. was this the only advantage reaj^ed by the United statement of TriT^ .,., ,. ., the Aeeounts States Treasury. Holdnig as it did at this iieriod of the United \ ■, States, 1782- $253,0005-1 ill bank stock, or rather more than nsr. five-eighths of the whole capital of the institution, it received, in common with the other stockholders, 48 A HISTORY OF 1782 tlie very large dividends which were declared by Montefioro's tlic haiik, mucli more than compensating for the Dictionary "f . Commene, intcrcst wliicli it paid npon its loans. American Edition, In December the president and directors grew 1803. Tit. " Baniv of uneasy at the extent of the Government loan, and North Amer- ica " asked for some rednction. The Superintendent of Finance accordingly sold out $200,000 of the Gov- Debate.s and emuient stock, and paid to the bank $300,000 of Proceedini;'.s of the Gen- the amouut borrowed. During the first half of the eral Assem- ^ r\ \Aj of Penn- year 1783 the bank advanced to the Government sylvania o" , ^ t t i i c ^ r\ the Memo- about $30,000. In July the rest of the Govern- rials prayinc; i i • • n • t ■ a Repeal or meut stoclc Avas sold, prnicipally to capitalists m the Law an- Holland. By October 1 $25,000 more had been TiiiUing the i i i • i n • i Charter of advauccd to tlie national treasury, making tfie the Bank. . ctr -i - - - r Matthew aggregate atlvaiice at that time about $16o,000. tor. Phiia- Tliis amouiit was not finally paid off until Jan- delphia, 1786, 49. uary 1, l/o4. Statement of In addition to the actual cash advances made to the Accounts of the United the Govemiiient, the bank was enabled in several State.?, 1782- 1^84. other ways to afford it invaluable assistance. The large amount of specie deposited in the bank vaults enabled it from time to time to discount in consider- al_)le amounts l)ills drawn on the Superintendent of Finance, S(j that the 2iul)lic agents were enabled to 23urchase for cash, and the Treasury was afforded time to provide the means of payment. It was in this way that the army was supplied with clothes and provisions, and the various public dejiartments largely assisted until the close of the war. Before THE BANK OF NORTH AMERICA. 49 July 1, 1783, discounts of tliis kind had been made 1782 to tlie extent of $820,000. " Without the establish- Debates and . , , Proceedings nient ot the national bank," said ]Morris, " the busi- of the Gen- eral Assem- ness 01 tlie Department of Finance could not have tiy of Penn- 1 f n T-v sylvania on been pert(jrmed. From the aids given l^y this in- the Memo- 1 TT ■ T - ' rials praying stitution the United States were able to keep up an a Eerieai or Suspension of army consisting ot a larger nunil)er of men than the Law an- 1 1 11 !• 1 r>iii nulling the they had had m the held before, or than they could Charter of -. . . , . , the Bank. iiave maintained "without these aids. The army Matthew Carey, Edi- was 111 ever}^ point on a much more respectable tor. " Phiia c • ^ !■ Ill delphia, looting than lormerly, anci they kept the enemy i786, 4'j. at bay." ibid., 50. " But the United States were not the only per- sons benefited Ijy this institution. The Legislature of the State of Pennsylvania, being unable to j^ay the officers of their army, granted them certificates of indebtedness, and mortgaged the revenue of the excise for payment of interest. When the interest became due the revenue was not collected, and the distress of the officers was great. On that occa- sion, without any particular aj^plication, the bank advanced the money, and took the reimbursement when the revenue was collected." ibid., 105. Again, in February, 1782, wdieii the State of Pennsylvania found itself so embarrassed that it was unable to pay its quota to the United States Government, the bank, without hesitation, agreed to advance |80,000 on hs behalf. During the first few months of the same j^ear. 50 A HISTORY OF 1782 when, owing to tlic unprotected state of Delaware Bay and River, the enemy's row-boats sometimes took vessels within the very Port of Philadelphia, which, within a few days, not only cleared the Bay and Biver, but captured a cruiser of twenty Debates and Proceedings of the Gen- eral Assem- bly of Penn- uud the State had not the means of granting ])ro- sylvania on _ _ _ _ the Memo- tcction agaiust so inconsiderable though insulting rials praying a Eepeai or au enemy, the l)ank, by an advance of about Suspension of the Law an- $22,500, enabled tlie merchants to fit out a ship, nulling the Charter ,,f the Panic. llatthew Carey, Edi- tor. ■ Phiia- guns belonging to the British fleet. delpliia, 1786, 106. On September 17, 1782, the bank advanced to the State Treasurer, for the defence of the western frontiers, no less than £5000, and even agreed to lend a further sum if necessity should arise. In Januarj'-, 1785, it loaned the City Wardens $2400, and the Managers of the House of Employment $1:000. In short, it proved of most material assist- ance both in State and municipal affairs. " The instances of its services," said a distinguished mer- cantile gentleman of the time, " are innumerable. Ask the managers of the House of Empbjyment. They will tell you the j'Oor could not have been fed without the existence of the l)ank. Ask the wardens of the city, and tliey will tell you that the city could not have l:)een lighted Ijut by means of the loans oljtained there. But it is needless to re- peat the instances, fu' I ]uay say there is no ser- vice, puljlic or charitable, to which its assistance Ibid. has been denied." THE BANK OF NORTH AMERICA. 51 By tlie beginning of tlie year 1784 the success 1784 of the bank Avas assured. The business and the profits ahke rapidly increased, so that, notwith- standing tlie heavy loans with which they obliged tlie public, the directors were enabled to declare annual dividends for that and the following year at an average rate of fourteen per cent., thus making bank stock the most desiraljle of investments. Bo great, indeed, was the demand made upon the bank for loans to aid both public and private enter- neimtcs and Pr<_iceeding.s prises, that the stockholders now felt emboldened of the Gen- eral Assem- to increase the amount of their cajntal. (J]i Jan- ijiy of Pcnn- svh'unia on nary 12, 17cS4, they accordingly authorized the ijie Memo- ^^ ^ rials praying directors to open the books of the Ijank on tlie a Repeafor Suspension of 1st of the following February for a new subscrij:)- the Law an- nulling the tion of one tliousand shares, at the rate of f oOO a Charter of the Bank. share, the new stockholders to stand on a par with :\rutthew C'arev, Edi- tlie old, and to jiay the amount of their various t.ir. 'Phila- delphia, suliscriptions at once. The shares were rapidly ivyo, i06. taken up, l-)ut meantime a difficulty arose which had not been anticipated. A number (.)f infiuential citizens, wlio saw and envied the success of the Bank of Xortli America, were anxious to participate in the profits of so lucrative a business, Ijut did n(.)t feel disposed to pay the difference between the original and the advanced value of its shares. They resolved, tlieixdbre, to set on foot a rival institution, to be kn(.)wn bv the name of the Bank of Pennsvlvania. 52 A HISTORY OF 178-]- The directors of the ohl bank, they assured the public, had been guihy of a haughtiness and par- tiality in their method of conducting business of which no one would ever find cause to accuse the Political officers of the new institution. It was better, at Essays, by Peiatiah any rate, they argued, to have " two shops to go VV tr UoLCl i 4^8. to" in banking as in otlier business. Large suljscriptions were rapidly got together, and an organization effiacted. On the 10th of Journal of t • i i a it Assembly, i^ebruary aj^j^iication was made to tfie Assembly February 10, 1784. ' for a ciiarter. ihe matter was referred to a com- mittee, who reported in favor of granting the 2^1^'^'y^i' 'jf tlie memorial. On the 2(5th the Bank of North America presented an application asking Ibid., Feb- that it mio'lit be heard by counsel as to the impro- ruary 20, ... 1784. priety of granting the new charter. But no atten- tion was paid to the request, and, on the 28th, the Tbid., Feb- matter was referred to a committee to bring in the ruary 28, 1784. draft of a bill. On March 10 the committee re- ported, and for a while the measure was allowed to Ibid., March ^ 10, 1784. lie on the table. Meantime, the directors and stockli(jlders of the old bank had Ijceii looking with great anxiety at the progress of the new enterj^rise. They strongly urged what t(j them seemed the fatal consequences of two capital l)anks operating in one city. They might, they feared, act in opposition to each other, and would be sure eventually to be of mutual dis- advantage. THE BANK OF NORTH AMERICA. 53 A meeting of tlie stoekliolders of tlie Bank of l'^84 North America was therefore convened on the 1st of March, and, as an eff'ectnal clieclc to the new undertaking, it was resolved to extend tire new suljscriptions, opened on Fehruary 1, to fnir thou- sand shares, at the rate of l)ut !|4()0 a share. All those who had already paid in their money at the rate of foOO a share were to have the surplus re- turned to them, together with interest at the cur- rent rate. The device acted admirably. The suh- •1 1 -r> 1 (• T-. 1 • Ti Stockhold- scriljers to tlie Jjank ot i ennsyivania were readily pis' iMimite,-. .11 1 . • 1 1 • T 1 March 1, prevaileil upon t(.> reluupush their scheme, and to i784. sidjstitute for the uncertain fortunes of a new un- Political 1 .1 p p ... Essays, by dertaking a snare in the prohts ot an institution peiatiah ' "Wobstcr wdiose success was already assured. On March 16, 448. when the matter came up before the Assembly, the directors of the new Ijaiik asked leave to withdraw their application for a charter. Permission to that effect was granted. Tlie suljscriptions to the old bank rapidly flowed in, and l_)v June 13, on which ^ ■' . 4 Hazard's date the books were closed, the capital was found Historical Kegister, 13li. to amount to $830,000. 54 , A HISTORY OF CHAPTER IV. 1785-17S8. Pennsylvania Paper Currencj' — Popular Demand for the issuing thereof in 1785 — Attitude of the Bank of North America adverse to the Scheme — Growing Unpopularity of the Bank — Petitions presented to the Assembly praying for a Repeal of its Charter — Arguments for and against the Bank — The State Charter annulled on September 13, 1785 — Views of the Directors as to this Action — Continuance of the Bank's Opera- tions — A Charter granted to the Bank by the State of Dela- ware on February 2, 178G — Attempts to obtain a Repeal of the Annulling Act^ — A New Charter granted by the State of Pennsylvania on March 17, 1787 — Provisions of the Charter — Prosperity of the Institution — Establishment of other Banks. 1785 No sooner was the difficulty about tlie proposed Bank of Pennsylvania settled than another and still fiercer contest was forced uj^on the Bank of North America. Pennsjdvania had before the Revolution Ijeen more successful tlian any other colony i]i circtdating and sustaining the ci'cdit of its 2)aper money. The bills had been issued in the sha2)e of loans to iutlividuals, secured by mortgage on their lands, and were payable at the expiration of ten years from tlie date of emission, a tenth paxt being usiuilly annually discharged with interest. THE BANK OF NORTH AMERICA. 55 By tliese prudent measures they were, as a rule, 1785 kept at par witli speeie, and never suffered any Boiies' Fi- nancial His- but slight fluctuations. torj^ of the United A numerous partj' now arose in the 8tate, who states, 27. demanded and obtained a renewal of this line of policy. But they readily saw that unless the bank would give the new l:»ills currency the State could never hope to get them into circulation. This the directors were at first both unwilling and unable, to any great extent, to accomplish. Hence the l)ank came to lie regarded b}^ many as the op- ponent of the 2)aper money scheme. It was in Hjid-, 345. vain that ]\Iorris argued that the bank had with- DeLates ami Proceedings drawn its opposition to the scheme, and showed of tiu- Gen- eral Assem- by the ledgers and accounts the large amounts of biy of Penn- sylvania on the new currency which the bank did actually tiie Memo- rials praying accept. By March of 178G it had received on a iiepeai or Suspension of deposit £107,280 14.s'., or nearly the whole of the the Law an- nulling the emission, exceijt that which had been reserved for Charter of ^ ^ . the Bank. the operations of the loan-office. But its early Matthew Carey, Edi- inimical attitude had 2)roved fatal to its popu- tor. Phila- delphia, larity. nso, 119. One source of troidjle led to another. The financial distresses of the mercantile world were still undoubtedly great. The total prostration of business during the period of the Bevolutionary War had been succeeded, on the conclusion of peace, by an excess of British importations, drain- ing specie from the American market. As a re- Journal of Assembly, March 21 , 1785. .56 A HISTORY OF 1785 suit, money was scarce and usury common. The suffering to wliicli all classes were subjected was great. Tlie public sought some adecj^uate cause for their miseries, and thought they found it in the establishment of the bank. The Democratic 2:iarty, then just coming into existence and power, embraced the popular ojjinion. It was not long before the opposition took a tangible shape. On March 21, 1785, a petition was presented to the Assembly, from a number of the inhabitants of Chester County, praying that steps might be taken to repeal the charter of the bank. There was no evil from which the country was suiFering but Avas, in the opinion of the j^etitioners, to be ascribed to the baleful influences of that institution. Usury, extortion, favoritism, harshness to its creditors, op- position to the favorite schemes of the Assembly, the possession of undue and dangerous political and commercial influence, all these were laid at its doors. The abolition of so harmful an organ- ization they thought was alone necessary for a restoration of public and private prosperity.^ ^ " Petitions from a confideraMe number of the inhabitants of Ches- ter County were read, representing that the bank established at Phil- adelphia has fatal eti'ects upon the community; tliat whilst men are enabled hy means of the bank to receive near three times the rate of common interest, and at the same time to receive their money at very short warning whenever they have occasion for it, it will be impos- sible for the husbandnu^n or mechanic to borrow on the former terms of legal interest and distant payments of the principal ; that the best THE BANK OF NORTH AMERICA. A great numljcr of similar petitions was about the same time presented, and on IMarcli 23 a eommittee was accordingly appointed " to inquire wlietlier tlie bank established at Philadelphia was compatible with the public safety and tliat equality Avhich ought ever to prevail l)etween the individuals of a republic." The controversy once aroused, a war of pam- phlets and arguments ensued. The opponents of the bank aliounded with olyections t(j its method of transacting business, and urged with vehemence what they deemed its disastr(jus effects on the com- munity. It enabled men to trade to their own security will not enable the person to borrow; that ex|ierience clearly demonstrates the mischievous consequences (if the institution to the fair trader ; that impostors have been enabled to support themselves in a fictitious credit by means of a temporary punctuality at the bank, until they have drawn in their honest neighbors to trust them with their projjerty, or to jiledge their credit as sureties, and have been finally involved in ruin and distress; that they have repeatedlj^ seen , the stopping of discounts at the bank operate on the trading part fjf the community with a degree of violence scarcely inferior to that of a stagnation of the blood in the human body, hurrying the wretched merchant who hath debts to pay into the hands of griping usurers ; that the directors of the bank maj' give such preference in trade, by advances in monev t'l their jiarticular favorites, as to destroy that equalit)- which ought to pirevail in a commercial country; that paper money has often proved beneticial to the State, but the bank forbids it, and the people must acquiesce; therefore, and in order to restore public confidence and private security, they ]iray tliat a bill may bo brought in, and passed into a law, fir rejicaling the' law fir incor- porating the bank." Journal of the Assembly of Pennsylvania, vol, ix. p. 233, etc. 58 A HISTORY OF 1785 ruin and that of their creditors, by giving them Considei-u- \\^q temporary use of credit and monev. Its slen- tions on the -l ./ ^ liank of Jei- caiiital, as comi)ared with the vastness of its North Amer- ^ '- ica. Phiirt- transactions, rendered it merciless in the strict clelphia,1785. ' Address to punctuality which it required of its debtors, thus of'^:i^nn's'.'il"^ frequently thr(_)wing honest men into the hands of vanm on the ^.^m-^^.^.g q^i^e o-reat dividends on bank stock in- Abohtion ot o the Bank of jm-,g^"[ naoneyed men to invest in this way rather JSIorth Amur- •' J lea I'liij^'i- than lend to the public at a reas(jnal_»le rate of in- delphia,! (85. -1- Debates and tercst. Ilich foreigners would fjr the same reason o/'the'^Geif-^ ^^^ iuduccd to buy up bank stock, until, finally, biy of ^^p "nn- th'^ wliole Capital of the institution would be owned the^Jiemo" abroad, and the country constantly drained of a Repeai'^'r"^ spccic by the exportation of the dividends in coin. theiJaw'-ui'-' Tlic bank injured the circulati(jn (jf the State bills Charu^r of" *-'f Credit. Tlic directors were Ijy their jjosition Matthew cualjlcd to obtain unfair advantages in trade for to'r!^'*'*'phiia- themselves and their friends. The wealth and epiia, /, J. ^jf|^gm3g ,jf ^l^^^. corporation, and particularly its D 1 ss G r t fi t i n s on Govern- attribute of pcrpetual existence, were dangerous t(j ment, tlie i /-< n i • c i Affairs of tiie tlic (jovemmcfit, and destructive ol that equality Bank, and i - i i • • r* Paper wliicli ougut to cxist 111 a trcc couiitry. Money, by mi ^ ^ ■ c i i i Thomas oucli Were the chiet arguments used l:iy the Paine. Pliila- , . • o c i i ,• i deipiiia,i78i;. JJeniocratic party in tavor (jt the repeal ot the The True In- charter. terest of the United 111 answer to these, the supporters of the l)aiik States, and partieniariy urgcd a Variety of considerations. They admitted of Pennsyl- vania, Con- it to be true that some persons had been ruined liy sidered, etc., with some tlic liclp of a fictltious Credit, but this they averred THE BAiXK OF NORTH AMERICA. ' 59 proceeded from tlie folly of the borrower, and not 1785 from the feiilt of the bank. His minfijrtune Avas a Observations on the yub- consequence not ot the nse, but of the abuse, of the jectof a -Bank, etc. privueo-es which the bank afforded. " It would be Phiiadei- a marvellous tlimg to proluljit the use ot water Political 1 i'~ 1 11111 Essays, by because some people choose to drown themselves. Peiatiah rm Till T -11 Webster. ihey conceded that the punctuality refpiired by the bank was sometimes injurious in its result, yet they pointed out that the l»orrower should be more careful in calculating when he could repay, and that the bank should not be blamed for en- forcing an agreement into which their customer had voluntarily entered. They denied that the bank stock in the market prevented investment in other directions. They showed how inconsider- able a proportion the capital of the bank bore to the floating cash of the country, and attributed the stringency of the money market rather to the drain of specie abroad, and to the fear of a paper issue, folloAved by a legal tender enactment, than to any causes over whicli the bank held control. They averred that the purchase of bank stock l^y for- eigners was rather to Ije encouraged than dreaded. It was sure to bring specie into the country and to secure numerous friends abroad, who would dread nothing so much as the occurrence of a war with any European power. As to the exportation of dividends, they urged that this sliould consti- tute no cause for ajiprehension as long as the prin- (iO A HISTORY OF 1785 cipal on wliicli they were based remained among us. Tliey admitted tliat the management of the bank had at first l)een oj^posed to the new emission of paper money, but insisted that the institution could now present no efficient obstacle to its cir- cuhition. They showed, indeed, that the directors liad abandoned their former policy of opposi- tion, and had lent what aid they could to the circulation of the new bills by freely receiving them on deposit. They challenged their oppo- nents to adduce one single instance of undue favor- itism on the part of the directors, and jjointed out the absurdity of assigning the jiossibility of injus- tice as sufficient ground for divesting chartered rights. Finally, they contended that the institu- tion, so far from being dangerous to the Govern- ment, had already proved itself of most material assistance to it. Nor could they understand how the existence of a corporation so lieneficent in its operations could be deemed inconsistent with the 2")rinci2Dles of the Reimblic. Othei' C(jnsiderations were 2:)resented by the friends of the bank of ecpial, if not greater, weight. They claimed that Congress had not exceeded its powers in calling the corporation into existence ; that a national l)ank had become a national neces- sity, and, as such, was properly created by the cen- tral national power. Implied authority to this end they claimed was conferred liy the Articles of C^on- THE BANK OF NORTH AMERICA. 61 federation upon Congress 1jy the clause enabling 1785 it to Ijorrow money on tlie credit of the yarious States. Assuming, therefore, the validity of the Congressional Ordinance of Incorjioration, they urged with great force that the repeal of the charter granted hy the State would lie nugatory, and that the bank would be enabled to continue business without interruption. Waiving this point, they insisted that the stock- holders of the Bank of Xorth America could not be constitutionally deprived of their property in their chartered rights without due comjiensation being made them by the State, or the institution of a judicial j^i'oceeding in the nature of a quo vxtrranto. And even if it was comjietent for the Legislature thus to override j^i'ivate rights, they j^ointed out the foil}' of such an arbitrary exercise of power as sure to shake the confidence alike of our own people and f )reign nations in the credit and honesty of the Commonwealth. In addition, they recalled to the minds of the peojjle the great and solid benefits which the bank had already confei'red, its loans to the Govern- ment, its assistance to the State, its support to trade and commerce, its invaluable services in aidino- to restore the countrv to a sound financial basis ; and they expressed a hojie that, if per- mitted to carry on its prosperous and increasing business, it would continue to perform for the 62 A HISTORY OF 1785 community the same 1:)eneficent offices of which experience had shown that it was capal^Ie. If thwarted in its prosjjects by legislative inter- ference, a diminution in its sphere of usefulness Letter, Mor- ris to j^aniei was of course to be anticipated, but even then they Clarke, May . . . . . 30,17813. "' ventured to predict that it would "exist in spite Diplomatic Correspond- of calumuy, Operate in s^^jite of ojiposition, and do ence, vol. xii. p. 108. good in spite of malevolence." Meantime, a host of petitions for and against the proposed repeal were presented to the Assem- Jnurnal of A.s.semijiv, bly. Al)out twclvc hundred signatures urged the March 21 ' and 23, 1785. measurc : about half as many opposed it. The weight of popular opinion was too strong to Ijc Avithstood. On March 28 the committee to whom the matter had Ix'cii referred rejiorted that ill its opinion the l)ank as then managed was in every way inconsistent with the public safety, and it therefore recommended that a bill should be at once l)roui>'ht in to reitcal the act of incorpora- Ibid., Slarcli _ ... ! . 28, 1785. ti(jn. It was in vain that the friends of the insti- tution moved to sul)stitute the phrase "alter or I amend" fjr the word "repeal." The amendment was rejected by a two-tliirds majority, the report accepted, and the committee at once rcapp(nnted to Ijriiig in a bill in acc(jrdaiice with its own rec- ommendation. On the f )llowiiig day, March 29, the committee reported the l)ill to the House, and at the same time a most respectful memorial was Ibid., March -n i 2!), 1785. read from the President and Directors of the Bank THE BANK OF NORTH AMERICA. 63 of North America, praj-ing that they might be 1785 heard by eonnsel against the proposed measure. On April 4 the liill came uj) for second reading, Journal of Assembly, and the House determined to push it with vigor. A),rii 4, 1785. The bank was refused permission to be heard by counsel, a motion to j)ostpone the consideration of the bill was lost, and by an overwhelming ma- jority it was ordered to be transcribed and printed for public circulation and comment. The House soon after adjourned, but the direc- tors of the bank could now have little doubt what the fate of their charter would be. They resolved, therefore, to make application to Congress for some relief from their embarrassing position. James Wilson, one of their number, took upon himself the task. The following passage from a letter written to him on May 12, 1785, by the presi- dent, Mr. Willing, will best serve to indicate the tone of feeling then prevalent among the friends of the bank: "As to the business of the bank, the wdiole must be left to your prudence to take such ste23S in Congress as the magnitude of the question and the complexion of that body may render neces- sary and proj^er. 'Fiat justitia et contentus sum.' With the Assembly the word is ' Carthago est delenda,' let the Congress judge for what end or purpose, and let them consider too that when this political child of theirs has once breathed its last, they have no Promethean power to call another 64 A HISTORY OF 1785 into existence : confidence once lost is not often, if ever, to be regained. This is, perliaj)s, the only instance where a politic body has been annihi- lated, and private interest and j)roj3erty violated, "without the least charge of abuse of power or mal- 2:)ractice suggested, much less proved before a jury of twelve men. In the ju'esent case not only the Constitution of the State is violated, l>ut the Con- federation of all the States is also violated, and a stali — a mortal stal) — is given to the honor of Con- gress and the credit of all America. We have served our country, and served her in the worst of times, when our present opposers gave no assist- ance to the means of doing it. Let them consider this, and blush at the return they are now making. Let the Congress, too, consider this, and then de- termine whether they ought not to exert their in- fluence wdth every State to support an institution to which they have given an existence, and from which they have received a dutiful return. I have devoted a large portion of my time, and, considering the period of my life, a very j^recious part of it, too, to the service of my country in the establishment of the Ijank, but it is my 2;)ride, it is my greatest glory, that it has thus far succeeded. To preserve it from destruction, and to further our public measures, I would still go further, I would devote the few remaining years I have in its service rather than it should fall a THE BANK OF NORTH AMERICA. 65 sacrifice to tlie delusion of party, or to tlie in- 1785 sidious designs of Tories and British emissaries. God grant that tliis may not l;)e tlie case. To j^re- vent it, I conjure you, by every tie you have to the institution of which you were an early \)Y0- tector, by every tie you have to the country you 5^''°™ "^ •="?? •'•'•' ■' ■' in the posses- live in, to exert every nerve in its defence." sionof the ■' bank. But no effectual steps were after all taken, and in August the Assemljly of Pennsylvania again convened. A disposition was at once evinced to 2:)ush through the bill repealing the bank's charter. On August 2(3, the first day of the session, an early Journal of day was named f(jr the final disposition of the AssemUy, August 26, matter. i"85. On the 30th a second memorial was presented from the President and Directors of the Bank, setting forth tha.t, although their application to be heard at the last session of the House had failed, they were, nevertheless, not discouraged from re- newing an a2)plication upon that subject, inasmuch as they apprehended that a hearing C(juld not be denied them without violating both the essentials and forms of justice. The memorial further called to mind the great utility of the institution, both to the State and to individuals, and expressed a firm conviction that the petitioners would Ije able, if heard, to invalidate every objection that had been urged against it. They, therefore, prayed that they might be allowed, before any other proceed- 66 A HISTORY OF 1785 iiig*^ were taken, to a2:)2iear and j^i'esent tlieir case Journal of before the bar of tlie House. Aut^ust 30, On the 31st the Assembly resolved to grant the 1785. „ , . . , . 1 ... jjrajrer ot the petition, but not without insisting that the hearing was of grace, not of right. At the same time they resolved that a like permission sh(.)uld be accorded to the advocates of the pro- Ibid., Au- gust 31, 1785. posetl repeal. On September 5, accordingly, Mr. Willing ap- j)eared at the bar of the House, accompanied by James Wilson, Esq., whom he presented as author- ized by the bank to speak in its defence. Mr. Wilson C(jnsumed the time of the House fijr the residue of that and a pijrtion of the ensuing day. Ibid., Sep- and was followed by Jonathan Dickinson Sergeant, teniber 5 tind -^ , - n i i p <• i e, 1785. Jcj>'^<1-, wno appeared on beluui ot tlie petitioners. But the conclusion had long since Ijeen foregone. In the then state of popular prejudice ^Ir. Wilson's argument probably failed to convert the mind of a single meml)er of the Assembly. On Sejitember Ibid., Sep- 13 th3 l)ill was 2>assed, and the bank as a State tcmber 13, . , . 1785. corporation ceased to exist. Letter, Notwithstanding the deju'ivation of its corporate Thomas • 'i ^ ^ ^ • i t • Willing to privileges, the hank c(jntinued to transact l:)usiness. His Excel- , ni* t i r*i p lency P. J. but naturally lost in some degree tlic conndence ot Van Berckel , ^ ^ ^ inix i and others, moneyed men b(.itli at liome and abroad, its stock 1786, of' fell to six per cent, below par. Its cash account for bank retains 1784 had amouuted ill all to o9,o70,000 IMexican '"''"''^'' dollars. For 1785 it dropped to 37,000,000 Mexi- THE BANK OF NORTH AMERICA. 67 can dollars. But, in spite of all difficulties, by the 1785 close of the latter year its wealth "was estimated at Political Es- '' _ says, by Pela- nine hundred thousand silver dollars. tiah Web- ster, 447 and In the month of March, 178G, a careful account 44!i. was taken as to the ownersliip of its stock. It 1786 was found that this now aggregated in par value Debates ami 1870,400, or 2170 shares. Of these luit 285 of the Got- shares were owned by foreigners, nine-tenths of biy of Penn- 1 TA 1 r.r\n i 1 1 svlvania on Avhom were Dutchmen, OtOO shares were owned by the Memo- I' -\T TT 1 • T\ r 1 T>i 1 rials pravinn' Citizens ot jNew Hampshire, Jiassaciiusetts, Ivnode a Pvepear..r _ , . ^^ 1 -NT T -r\ 1 Snspenfeion of Island, Connecticut, JNew l ork, JNew Jersey, JJela- tiie Law an- , ,^. . . - - , 1 1 Ti nulling tbe ware, and \ irginia, -jO snares were owned by i enn- charter of , . . -, . , /• 1 c< 1 *'"^ Bank. sylvaniaiis resident in other parts ot tne btate, and Matthew „ , • • • -, o.>- 1 1 Carey, Edi- all those remaining, viz., 12oo sliares, were owned tor. Phiia- b}' citizens of Philadelphia. i786, 95. Tlie continuance of the l)ank's operations was deemed on the part of the directors to be fully warranted by the powers derived from the Con- gressional charter. But, however confident they might be as to the validity of that instrument, they could not l)ut be sensible tliat grave doul)ts on that point were entertained in the community. Early, therefore, in January, 178G, they re- solved to ttdce ste2)s to re-estaldish, if j^'^'^^ible, their corporate existence under State sanction. Their counsel advised thorn that " the modification of the bank's charter, as to limitation of time or capital, would not at all affect the Congress char- ter, and that it would not lie improper for them to 178G 68 A HISTORY OF 178G receive such a charter." Overtures were, tlierefore, Minutes of at oucc made to the State of Delaware for a o;rant Stockhold- , _ '^ ers' Meeting, of cori3orate rights, which were so successful that Januarj' 9, 1786. on February 2, 1786, the Assembly of that Com- Bootii'sLaws moii wealth passed a bill conferring upon the bank vol. il 'sTs"'' the usual franchises of a corporation. On Fel)- Minutes cf fuary 7 the directors received notice of this fact, FebTuaryG ^^^^ readily accepted the charter;^ and, if neces- sary to the transaction of their business, they 1 The following letter to Eiehard Bassett, Esq., of Delaware, whose efl'orts had been most active in the bank's behalf, was written hj Mr. "Willing immediately on receipt of the new charter: Bank, Feb. the G"", 1786. KiciiABD Bassett, Esq''. Sir, — I have this moment the Honor of yours of the 3'^ inst., cov- ering the Charter granted to the Bank of North America by the Patriotick Legislature of the Delaware State. It is too late this Evening to lay it before the Directors, and your Express is anxious to go oft' earl}' in the morning. Therefore I can onlj' say for myself that I feel in the highest Degree the Obligation the Institution is under to the State of Delaware for thus kindly taking us by the Hand and giving us their protection, at a Time when our misguided Assembly here have Attempted most unreasonably to crush and destroy us. I thank you for the Service you have done us on this Occasion, and j'ou njay depend on the Warmest Zeal on my part to render every Service to j-our State, and the manj' Worthy Individuals of it, whenever it falls within my Line of Duty, citlicr in the station I have now the Honor to till, or as an Inhabitant of Pennsylvania. I am. Sir, with the highest respect, Y' much Obliged liumb. S', Thomas Willixo, Pres<". A copy of the above letter is to be found among the archives of the bank. THE BANK OF NORTH AMERICA. 69 actually contemplated the removal of the bank to 17SG Wilmington, New Castle, or some other j^i'ope'i' point within the State of Delaware. It was deemed wisest, however, before taking so desperate a step, and one which in all proljability would interfere so materially with the jjrosperity and usefulness of the bank, to make every effort to induce the Assembly of Pennsylvania to recon- sider its late action. Accordingly, shortly after the reassenil)ling of that l)ody on jNIarch 3, 178G, a petition, signed by no less than (J24 citizens of Pliiladel})hia County, was presented and read, 2)raying for an imme- diate repeal of the act rescinding the charter of the bank. Tlie petitioners recited again at great length the former services of the institution to the Government and to the public, and insisted that the late proceedings of the Assembly were unjust and arl_)itrary in the extreme. They pointed out the liaste witli which the measure had Ijeen carried through the House, showed that the public had had no fair op2)ortunity of canvassing its merits, urged that the bank should at least have been 2>ermitted to adduce evidence with respect t(.) the charges that Assembly, had been preferred against it, and finally, denied n'se. that those charges were actually true. The commit- Petitions of like purport eoming in daily, the March 23" ^ -, . , " ^ 1781-;. See matter was referred to a commUtee, wliose report journal of was taken \x\\ for discussion on March 2'J. It 'eo die. ' ' 9 70 A HISTORY OF 1786 revealed witli great distinctness the motives by wliieli the House had been actuated at the former session. It showed that neither the committee of investigation nor any of the prominent sujoportei'S of the Ijill had any practical acquaintance with the method of conducting the bank's oj^erations. Al- though offered Ijy the directors every facility, they had declined to make anj^ inquiry into its affairs, or even to come within its walls, but had Ijeen guided wholly, as the committee thought, by gen- eral preconceived notions, and according to the curi'cnt of poj^ular opinion rather than by the dic- tates of sober reason. It was further the opinion of the committee that the former House had too much disregarded the ordinary legislative forms and delays, that it should have proceeded with far greater caution in so important a matter as the divesting of chartered rights, and that the result of its conduct was a measure which the committee conceived to have " its foundations deej^ly laid in injustice, and to remain a reproach both to the Government and the peo2)le." It then called at- tention to the eminent respectability and intelli- gence of the present petitioners, and concluded by recommending that a committee should be at Journal of . , , . . ^• ^ Assembly, oucc ai)|)onited to brnii'' ni an act rei)ealintr the March 2!l, /^ * 1 & 1780. obiioxious measure. A very warm debate ensued, and lasted for three days. The petitioners for a reconsidera- THE BANK OF NORTH AMERICA. 71 tion of the repealing act now amounted to nearly 1786 three thousand, and the supporters of the bank felt a corresponding encouragement. ]\ressrs. Mor- ris, Robinson, Clymer, and Fitzsimons were the chief advocates of the institution. Messrs. A^^hite- hill, Findlay, Lollar, and Smiley its principal opponents. On the second day of the debate Robert Morris rose, and, in a speech of consider- able length and consummate aliility, defended the management from the charges of favoritism which Debates and ,,, . , Proceedings liad been made aganist them and demonstrated of the Gen- -,-,,->-,. . ^ r\ 1 ^^'^'^^ Assem- the value ot their services to tlie (jrovernment and biy of Pemi- , , svlvania on the community. tiie :Memo- "I have," said he, "a perfect and thorough tiieRepVai or , ...... . Siispensionof conviction that the institutKjii in its operation, the Law an- pp ,.... TO ' L' ' nr.lling' tlie lar trom being injurious to tlie otate, is ot service charter of -,..,-,.. T 1 the Bank. to every intlividual m it. it promotes tlie gran- Matthew 1 ^ir< • ■ 11 iiii Carey, Edi- deur 01 the State, increases its wealth, and adds to tor. "Phiia its dignity." But the drift of j)opular j^rejudice was still too strong. On Ajiril 1 the House divided upon the question whetlier it should accejrt the report, and the decision was in the negative l^y a vote of 41 to 27. The minority unanimouslv entered their dis- Assembly, sent upon the minutes, and a few days after brought itso. forward a resolution looking to the suspension of ^,.^ ^ ., ° ^ Ibid., April the repealing act. But this also met with no 7, 1786. favor, and for the remainder of the session the matter was allowed to drop. delphia, 1786, " .Jonrnal of Journal of Assembly, November 16, 1780. 72 A HISTORY OF 1786 In November the Assembly again came to- gether, and the subscribers to the l)ank again presented a memorial praying the House to re- consider its hasty and ill-advised action, setting forth anew with tedious minuteness the same ar- guments which had been before so often urijed. Their efforts were at length to be crowned with Ibid., N.)- success. The memorial was referred to a com- 178G. "' mittee, who, on November 20, presented their report, as follows : " That it is consistent with the policy of the Government immediately to revive the charter of the bank, but as this charter, altogether unlimited in duration, and almost so in the capital stock allowed to be employed, may from these circum- stances become an object of jealousy and appre- hension, your committee are of opinion that it might be expedient to qualify it, in its revival, in these respects, but in such manner as that, while all reasonable ground of objection to an institution so eminently useful to the commerce and agricul- ture of the State is removed, the bank shall remain uninjured in its essential rights, and be left freely to its own operations." Ibid., Dp- Qw December 13 a committee was appointed to cember 13, 1786. draw up a bill such as was recommended. On the Ibid., i)e- l;3th the bill was introduced, and, in spite of some cember 15, 1786. opposition and numerous memorials against its passage, reached by the middle of March, 1787, THE BANK OF NORTH AMERICA. 73 its final stages. On tlie ITtli of tliat montli it was 1787 finally ao-reed to by a vote of tliirty-five to twenty- Journal of Assembly, eio'llt. March 17, '^ _ 1787. The terms of tlie new charter differed mate- rially from those which had preceded it. The corporate existence of the bank was limited to a term of fourteen years, and its wealth restricted to two million of dollars. It was forbidden to hold real estate, except in so fir as was necessary for the transaction of its liiisiuess and the prevention of loss on its inyestments. It was expressly pro- hibited from trading in any merchandise, save bullion and bills of exchange. Finally, it was to cause copies of all its by-laws, as passed from -■- _ . . , Act of March time to time, to be deposited with the State i", i787. ^ 2 Dallas' authorities. Laws, 499. Although far from satisfied with the provisions of the bill, the directors of the bank conceived it l)est to act under its provisions, a step which, as will be seen hereafter, certainly sacrificed whatever rights they may have previously olitained from Congress. The bank may now be fairly said to have passed 1T8S through the most critical period of its existence. Peace had for some time been re-established, and the disastrous efifects of the war were at least in some measure beginning to disappear. A danger- ous and turbulent opposition had been successfully overcome, and the utility of the institution thor- 74 A HISTORY OF 1788 ouglily demonstrated. Its notes continued to cir- culate at their full valvie, the difficulties that had environed it vanished, and all fears resj)ecting its ability to redeem its promises subsided. Encourag'ed by its success, two other banks — one in New York,^ the other in Boston^ — had already S|)rung into existence. In 1791' a fourth was established at Providence, and in 1795'' a fifth at Baltimore. The banking system had obtained a foothold in the country. ^ The Bank of New York begim business in 1784, but was not char- tered till March 21, 1791. ^ The Bank of Massachusetts was chartered Februarj' 7, 1784. ^ The Providence Bank went into operation in October, 1791. 5 Collections of Historical Society of Rhode Island, 3o7. ■* Scharf's Chronicles of Baltimore, 260. ^ ^"^The Presicicnc, Directors 4^ and Company of the Bank *^ ^C ^'^^''^'^^-^'^^i'^caproinisc *^d^ V%3 to pay to the Bearer, on 5 "^ ■4S DenTjaiLcl, THREE NINETIETHSofaDOLLAR. Juguji 6, 1789. ^ Tench Francis, Cojhier. *l'*H*/*L^A*D*E*L*F*f:*I*A5«» THE BANK OF NORTH AMERICA. 75 CHAPTEE V. 1789-1809. The Constitution of the United States goes into effect in March, 1789 — Hamilton's Treasury Report of 1790 — Reasons for tlie Estalilishment of the Ban!: of the United States — Tlie Bank of North America unahle and unwilling to discharge the Functions of such an Institution — Resignation of Thomas Willing' as President in 1792 — Election of John Xixon as President — Business of the Bank in 1792 — Establishment of the Bank of Pennsylvania in 1793 — The Whiskey Insurrec- tion of 1794 — Business of the Bank in 1794 and 1795 — The Yellow Fever of 1798 — Temporary Removal of the Bank to Germantown — Renewal of the Charter in 1799 — Increase in the Number of Banking Institutions — Reform in the Bank's Method of transacting Business effected in 1806 — Establish- ment of the Surjilus Fund in 1809 — Death of John Nixon and Election of John Morton as President in 1809. Ix Marcli, 1780, a great and fortunate cliange 1T89 took jilace in the management of puLlie affairs. The Constitution of the United States went into operation. A vigorous, res|)(_insil)le exeeutive was conferred upon the countr}', and an incredilde im- pulse given to till schemes of natioiud importance. Among those now caUed upon to take Y-^xi in the administration of pulilic affairs was Alexander Hamilton. Placed in cluirge of the Department 76 -A HISTORY OF 1789 of tlie Treasury, he found before liim the ^xo- digious task of settling the financial affairs of the United States upon a sure and satisfactory basis. Towards the attainment of this end no measure seemed more imjiortant to him than his old and favorite one for the establishment of a great na- 1790 tional bank. Without loss of time he devised a Treasury Ee- plan for sucli an institution, Avhich seemed to him Hamilton's joracticable, and in 1790 spread before Congress iii, 12').' ' the result of his labors. The proposed measure met generally Avith pop- ular applause, but there were some who doubted its wisdom. Among other difficulties that were thrown in its path was a suggestion that a new bank was quite unnecessary, since an institution was in existence which owed its origin to national bounty, and wdiich had already, ujion more than one occasion, manifested both its readiness and ability to extend a helping hand to the Govern- ment. With this objection Hamilton dealt most courteously. " The aid afforded to the United States," said he, " Ijy the Bank of North America during the remaining j^eriod of the war was of essential eon- sequence, and its conduct towards them since the peace has not weakened its title to their patronage and favor. So far its 2:)retensions to the character of a national bank are respectable, but there are circumstances which militate against them, and THE BANK OF NORTH AMERICA. considerations wliicli indicate tlie propriety of an 1790 estaljlishment on different principles. " Tlie directors of tliis Ijank, on l)elialf of their constituents, have since acted under a new charter from the State of Pennsylvania, materially variant from their original one ; and which so narrows the foundation of the institution as to render it an incompetent basis for the extensive jiurposes of a national l:)ank. . . . "There is nothing in the acts of Congress which imply an exclusive right in the institution to which they relate, except during the time of the War. There is, therefore, nothing, if the ])ublic good re- (piire it, which prevents the establishment of an- other. It may, however, be incidentally remarked, that in the general opinion of the citizens of the United States, the Bank of North America has taken the station of a bank of Pennsylvania only. This is a strong argument for a new institution, or for a renovation of the old, to restore it to the situ- ation in wliicli it originally stood in the view of the United States. But . . . there may Ije ro(jm to allege that the Government (if the United States ought not, in point of candor ox ecpiity, to establish any rival or interfering institution in prejudice of the one already established, especially as this has, from services rendered, well-founded claims to protection and regard. " The justice of this observati(_)n ought, within 10 78 A HISTORY OF '1790 proper boiind8, to be admitted. A new establish- ment of the sort ought not to be made withoiit cogent and sincere reasons of public good. And, in the manner of doing it, every facility should be given to a consolidation of the old with the new, upon terms n(jt injurious to the parties concerned. But there is n(j ground to maintain that in a case in which the Government has made no condition restricting its authority, it ought voluntaril}' to re- strict it, through regard to the interests of a par- ticular institution, when those of the State dictate a different course ; especially too after such circum- stances have intervened, as characterize the actual situation of the Bank of North America. . . . "If the ol ejections, which have been stated, to the constitution of the Bank of North America, are admitted to be well founded, they will, never- theless, not derogate from the ]uerit of the main design, or of the services which that bank has rendered, or of the benefits which it has produced. The creation (if such an institution, at the time it took jilace, was a measui'C dictated by wisdom. Its utility has been amply evinced l)y its fruits. Amer- ican independence owes much to it. . . . " The Secretary begs leave to conclude with this general oljservation, that if the Bank of North America shall come forwai'd with any jiroposi- tions, which have for their oljject the ingrafting upon that institution the characteristics wliicli THE BANK OF NORTH AMERICA. 79 sliall appear to tlie Legislature necessary to tlie 1790 due extent and safety of a national l)ank, there arc, in liis judgment, weighty inducements to giving every reasonaljle facility to the measure. Not only the pretensions of that instituti(jn, from its original relation to the Government of the United States, and from the services it has rendered, are such as to claim a disposition favorahle to it, if those who are interested in it ai'e willing, on their part, t(j place it ow a footing satisfactory to the Government, and e(pial to the purposes of a bank of the United States ; but its co-operation would naturally accelerate the accomplishment of the great object, and the collision, which might other- wise arise, might, in a variety of ways, prove e(pudl3" disagreeable and injurious. The iucor- 2)oration and union here contemplated may Ije effected in different modes, under the auspices of an act of the United States, if it shall be desired Trefisury Eo- l)y the Bank (jf Xnrth ^V.merica, ujjon terms which namiituns 1* 11 T ^ rA Works, vol. shall appear expedient to the Government. iii. 120. As far as can be ascertained, hcnvever, the man- 1T91 agement of the bank took no steps in accordance with the suggestions of the report. The (piiet and prosperous business in which tliey were engaged, under State auspices, was to them preferable to the anxieties and hazards which would probably attend the new Jiational undertaking. The scheme of a sejiarate instituti(_i]i was, therefore, rapidly 80 A HISTORY OF 1791 pushed forward, and on February 19, 1791, the first Bank of the United States began its corjjorate existence. 1792 The Bank of Nortli America now sustained a serious loss in tlie resignation of its president, Mr. Willing, on January 9, 1792, after a term of ser- vice extending over a little more than ten years. He had been chosen to j^reside over the affairs of the Bank of the United States, a station for which it was justly supposed that his talents and experi- ence eminently qualified him. He Avas succeeded in office by John Nixon, an almost equally well- known and respected citizen. Born in 1733 of Irish parentage, Mr. Nixon for a number of years did a 2^rosperous business in the city of Philadel- phia. He was one of the many signers of the Non-Imj)ortation Kesolutions, and ujwn the break- ing out of the Revolution made himself j^rominent by his strenuous efforts and wai'm interest in the national cause. He was a member of the CVjm- mittee of Safety, and had the honor of first pro- claiming to the citizens of Philadelphia the Dec- An interest- laratiou of Indeiiendcuce. Durino- some portion ing sketch of ^ o j. the career of of the War lie did active service, with the rank of .John Nixon will be found coloucl, iu the Continental army. He was one of in the " Cen- •' tenniia Col- the Original subscribers to the bank, and had been lection." 1 ° Pennsyiva- a dircctor sincc 1784. He retained the office of niaMagazine of History and Biog- raphy, 188. occurred on December 24, 1808 of History president for seventeen years until his death, which and Biog- ^ ■' PRESIDENT OF THE BANK OF NORTH AMERICA 1792- 1808 THE BANK OF NORTH AMERICA. 81 ^Meantime, the business of tlie l)ank was rai)i(llY 1792 inereasing as tlie C(:)mmerce of the country greAv. The profits -were so great that annual (hvick-nds of twelve per cent, were paid to the various stock- holders. jSTor did the institution cease to accom- modate the puhlic from time to time with loans of eonsideralde extent. During the year 17'Jl the hank advanced to the Commonwealth, at dift'erent times, in all $1()0,()00, and in the following year something over $53,000. In 17'.)o the State made some overtures to the l)ank, with a view of becoming a particijiant in its business and pi'ofits, l)ut a. satisfactory arrange- ment, it was found, could not be concluded. The result of these negotiations was the establishment 1793 of the first rival institution with which the Bank of Xorth America had to contend on its own ground. The State authorities, having been un- successful in their application to the old Itank for an interest in its dealings, now obtained from the Legislature a charter f_>r an entirely new insti- tution, known as the Bank of Pennsylvania, in which the C-ommonwealth was interested to the extent of a million of dollars. By a clause in the act of incor|)oration the stockholders of the I'ank A.t jrarch . ... . -50. i'93- 3 of Xorth America, upon relin(pushing their char- Smith's Laws, 97. ter, were at libertv to embark their whole eaiiital Storkh.il.l- in the new undertakinir. But of this i)ermission eis' Minutes, ^r-i.v 28, thev declined to avail themselves. no';;. Directors' Jliiuites, August 10, 17ri2, also Stoclvhol.l- ers' jMinutos. .January and February, 1793. 82 A HISTORY OF 1794 In 1794, tlie Whiskey Insurrection, which for three years had heen going on in tlie western part of the State, reached its climax. In tlie fall an army of 19,500 men was sent against the insur- gents, to whose equipment there is reason to think the bank materially contributed. The notes of all persons actually on military service were by the Directors' , ,..,., -, Minutes, bank on apjjJication laid over or renewed, nor was 15, 1794, and aiiy demand made for their payment until the Deceniljer 8, -, . ,, 1791. conclusion ot peace. During tlie year 1794 the business of the bank increased to an unprecedented extent. The whole amount of the year's debits and credits exceeded 24(_) millions, and the timount of cash received and paid, as entered in the cash-book, 120 millions, ex- clusive of several millions jiassing in exchange with other banks, and also of large sums of g(jld ;ind Ibid., .Tan- silvcr exchanged lor notes, and of notes exchanged 1795. "' for specie, imt a2)pearing on the books. During 1795 the following year the transactions were even ibid., i)e- larger, the books showing that the amount of cash 1796. received ami paid was more than 121 millions. 1798 In the summer of 1798 the pi-evalence of the yellow fever caused the btink to alter the site of its opertitions. 8o disastrous were the ravages of the disease in the iieitihborhood of the bankino;- house, tliat by September it was thought unsafe for the clerks to attend to their daily duties. On September o a meeting of the directors was accord- THE BANK OF NORTH AMERICA. §3 ingly eonvened at tlie casliicr's house in tlie Xortli- 1798 ern Lil)erties, in such liaste that the minute-book Avas forgotten, being left Ix'hind in the bank, and it Avas resolved immediately to transfer the busi- ness to Germantown. For this purpose the Union Behool-House "was leased in eommon by the ]')anks of Xortli Amer- ica and Pennsylvania, and on the (ith instant the iiinutc's ,. 1 • i V i TT ii September o tormer m(jved into its new quarters. Here the audi;, 1708. transactions of the l)ank were carried on fjr nearly two months. ^Meantime, the distress in the city was incredibk\ Multitudes died, business was to a large degree suspended, and the p(jor were reduced to the greatest straits l)y the lack ibid., Sep- of employment. The bank advanced .'J^lOjOOt) in lyos. aid of the sufferers, which proved of material ibid., Xc- veniber 2, assistance. By November 2 the malady had so i798. far sidisided that the bank was enabled to resume its business in town. In ISOI tlie charter of the bank expired. By isoi this time, however, the Legislature had come to appreciate somewhat more fully the value of the institution, and there was, therefore, but little troulile ill procuring a renewal of its c(jrpoi'ate franchises fjr a further term of fourteen years. This was eft'ccted by an act of Assemljly a^iprovcd AFarcli ''() 1 7')') ^ Smith's Jiaun ^U, li.U). Laws, 359. The l)ank n(.>\v continued its business for several years under auspices less favoral.)le than Ijefore. Itj, 84 A HISTORY OF 180-1 Tlie number of banks in the country had greatly Observations increased. By 1804 it was estimated that there on the Prin- ciples and were forty-five in active oi:)eration. Trade and Operations of Baniiing, commercc had received an immense impetus, and with Stric- tnres on the the mctJiods of cloiuo' busincss wexe rapidly and Opposition to the Bank of matcriallv altered. The Bank of iVortli America Philadel- ■ '' phia, 1804, was Under a management too conservative t(j keep pace with these innovations, and, as a consequence, 1806 by 180G its j)rofits were sensibly decreased. A committee appointed to make investigation into the causes of this decline reported that it was to be attril^uted to a variety of cii'cumstances. In the first place, the policy of the l^ank had fijr the past few years been such as to jirevent it from partaking in ajiy great degree of that patronage from the Gen- eral and 8tate Governments which other banks enjoyed. In addition to this, it apj^eared that for many years the directors had been in the \vA\Ai of discounting large amounts of accommodation- paper, which they renewed from time to time, as a matter of course, thus making a great part of the Ijank's ca2)ittd c(jmparatively inoperative. Nor was the benefit of these loans shared at all etpudly by the mercantile community. On the contrary, the accommodation was aftbrded almost exclusively to a few favored individiuds, who were familiar with the character of the Ixink's operations. A -s'igorous attempt was made to do away with these evils by the speedy adojjtion of measures of 7 2^^^ PRESIDENT OF THE BANK OF NORTH AMERICA 1809--I822. THE BANK OF NORTH AMERICA. 85 reform. Credits were shortened, tlie punctual col- 180G lection of debts more rigorously enforced, discounts upon accommodation-pa])er at long dates rejected in fiivor of investments wliicli promised more profit and less delay, and tlie advanta"-es to Le derived Di rectors ■' from the use of the capital thus more generally Minutes, , , -111 November tlirown open to the mercantile world. n, isue. 80 successful were these efforts that within a 1809 few years the hank regained all its former pros- VtAA., De- ° ^ cember 18, perity. By the close of 18()U it was enabled to I809. begin a surplus fund by the laying aside of i|15,()()(J (.)f the pr(.)fit and loss account. To this was added i|27,4(.)0, a sum realized from the sale of some of the bank shares which had not before been subscril^ed for. Others of these shares were now soltl, enough to make the sum in all of f80,(J(J(), and it was agreed that the annual in- terest on this amount should be accumulated until the fund reached $100,000. The year 18()*J was also marked in the history of the bank by the election of a new 2)resident. John Xixon died on December '1\, 1808, and, at the first meeting held l)y the incoming board of directors for the year 18(JU, John ^Morton was ibid., Jan- uary 10, unanimously elected in his place. lyo'o. 11 86 A HISTORY OF CHAPTEE VI. 1810-184S. Expiration of tlie Cliarter of tlie First Bank of tlie United States — The Bank of Nortli America Petitions Congress for tlie Re- newal in 1810 — Failure to obtain a Renewal from Congress — The War of 1812— Assistance afforded by the Bank to the Government during the War — The Panic of 1814 — Policy of the Bank during tlie Panic — Renewal of the Bank's Charter in 1814 — Establishment of the Second Bank of the United States — End of the Panic in 1817 — Resignation of John Morton from the Presidency in 1822 and Election of Henry Nixon in his place — Renewal of the Charter in 1825 — Terms of the Kew Charter — Sale of the Bank Shares in 1825 — Efforts to obtain a Renewal of the Charter of the Second Bank of the United States in 1832 — Attitude of the Bank of North Amer- ica — Failure of the Efforts — Change in the Method of Trans- acting the Bank's Business between 1830 and 1835 — The Congressional Charter Null and Void — Failure of Efforts to obtain an Increase of the Capital Stock in 1835 — The Panic of 1837 — Suspension of Specie Payments — Policy of the Bank of North America — Death of Henry Nixon in 1840, and Elec- tion of John Richardson as President — Resumption of Specie Payments in January, 1841 — Failure of the Bank of the United States in February, 1841 — Renewed Suspension of Specie Payments— The " Relief Act" of May 4, 1841- Re- fusal of the Bank of North America to accept its Terms — Views of the Bank as to Resumption — Resuinption effected in March, 1842 — Dangerous Position of the Bank in 1842 — THE BANK OF NORTH AMERICA. 87 Reduction of its Capitiil in 1843 — Ecstoration of tlie Capital to its old Volume in 1845 — Renewal of the Charter in 1846 — Provisions of the New Charter. In 1810, the cliarter of tlie first Bank of tlie 1810 United States being about to expire, a bill was in- troduced into Congress providing for its renewal. The measure had many advocates, but more deter- mined opponents. In December, the fate of the bill being very doubtful, a host of memorials and 2'>etitions flowed in from all sides both lor and against its passage. The directors of the Bank of North America strongly urged the necessity of the renewal. They transmitted t(j Congress a memo- rial, averring that in their opinion the termination of the national bank's operations would be attended Avith great suffering on the part of the commercial and agricultural interest, both on account of the rapid collection of debts necessary to wind up its affairs, and the loss of so valuable an institution. The citizens of Pennsylvania, in particular, they represented, would suffer great distress. They were borrowers from the baidv to a large amount, and owned fully a million of its cajiital stock ; their sacrifices must therefore be enormous if the charter were allowed to expire. Finally, the peti- tioners jiointed out the past services of the insti- tution, and expressed serious apprehensions as to Directors' how the commerce of the coiuitry was t(j be car- iMinutes, December 31, ried on Avithout its co-operation and assistance. i8io. 88 A HISTORY OF 1811 But, notwithstanding all argument, the 1)111 was thrown out by the House. A similar one failed in the Senate, and on March 4, 1811, the first Bank of the United States ceased to exist. 1812 111 1812 war was declared with Great Britain. GoddarcTs The Government at once had recourse to loans to Bankii'in'in- support the army and navy, depending princij^ally Europe'aii'd upou the banks to su2~»ply these, as well as to assist et^eq^.^'^' " ill promoting the circulation of the Treasury notes. The Bank of North America was prompt to afford Directors' . .,,,.. -, ., -,. Minutes, assistaucc ui Dotli directious. it received and cir- Julv 20, 11- 1815. culated the G(jvernment notes, opened suhscrip- 1813 tion-books in its banking-room to the United Ibid., March States loaii of 1813, and advanced to the Govern- 21, 1813. T, . 1 . ., ment in all about |5(joO,000 before the close of Ibid., April ^ ' ?J' ^^.l"' , 181o, besides affordino; material aid to the defence May 1.5 and ' o •^""« 1''- of the citv. In common with the other banks, it suffered severely from the disastrous system of over-issues and excessive trading into which the country then 1814 jolunged, and in August, 1814, it was finally forced with them to suspend the payment of specie. In the conferences which were now held be- tween tlie various Phi]adel])liia liauks, the Bank of North Amei'ica to(_)k a leading 2)art. It advo- cated from tlie first a more decisive and consistent line of policy than any other bank, advising the iuimediate contraction of issues and cutting down THE BANK OF NORTH AMERICA. gg of disconiits, so as to insure resumption at an early 18H and definite day. But it was not until February Directors' Minutes, 20, 1817, and then largely tlirougli tlie assistance September 4 and October of the second Bank of the United States, which lo, I8i5. had in the mean time been chartered, that tlie l:)anks found themselyes strong enough to accom- plish this resuh. ^ '" '^:til%,. In the year liSlo, the period stipuhited l:)y the bank's cliarter haying nearly expired, application had been made to tlie Legislature for a further ex- ibid., No- tension. But this was not to l)e had on yery favor- 1812. ' aide terms. On JNIarch 28, 1814, an act was finally approved which renewed the bank's chartered ex- istence for a term of ten years. In addition to the limitations of the former chai'ter several new ones were now inserted. The capital was restricted to one million of dollars, and ikj stock was to be transferred to or held by aliens, except citizens of Holland. Its affairs were at all times to be open to Legislative scrutiny. In addition to this, the l)ank, as a consideration f u' its franchise, was to pass 1120,000 to the credit of the State upon its books, and the Legislature wtis to be at libert}' at Act, Jinreii 28 1814 any time to annul the charter on refunding a jiro- pampbiet liortional part of this l)0iiiis. At a meeting of the stockholdei'S held May 11, ISld, the charter was ,'.,8' iii'mues, formally accepted, and the stipulated sum was isii. ' shortly after paid to the State. A periotl now ensued of tolerable commercial 90 A HISTORY OF 1822 Directors' Minutes, Januai'v 15, 1822. 1825 Directors' Minutes, January 24, 1825. l^rosperity, during wliicli the bank did a fair aver- age business. In 1822, Jolm Morton resigned tlie office of j)resident, and was succeeded by Henry Nixon, son of John Nixon, the second president of the institution. In 1825, the charter being again about to expire, application was again made to the Legislature for its renewal. The directors desired, if possible, to secure to the corporation the right to hold real estate, which Avas withheld by the former char- ter, and to have the clause authorizing inves- tigation into the bank's affairs by the Legislature omitted, but in neither of these respects were they successful. The new charter, indeed, which was ajjproved March 21, 1825, imposed a variety of new limita- tions and qualifications u|)on the corporate powers. The title of the corporation was now for the first time changed to "The Bank of North America."^ The debts incurred were never to exceed twice the amount of the capital, and, in case they did, the directors consenting to such excess were to be per- sonally liable. The discounts were never to exceed the rate of one-half per cent, a month. Dividends were invariably to be declared at least once in the year. In case of the non-payment of specie, a ^ Its title had tlieretofore been " Tire President, Directors, and Com- pany of tlie Banlc of Nortli America." See aaie, page 35. Ml J'i:. Adr, .1:1 in 1 K2 ■ •li'i- '.; tiif . • ■ , ;• hicli W'. ;r>.i to i.:iV '•a iiito til*.: TiMl:, but -i)'i I' '■;-.-■■■ -'.- .,;. /roved .1 ■ ■■ .*^'' ■ ■A .iit".\ limil.-i- 'S'jMirate jxiwi'is. ■ ,-. ■.,.1.- uow ibc ; in- iu -•< ikiiik oi" Norili AiiM ;■! -i *: !i-p,lVIH-'M( Jl-iik . : !;.■. }:'■.■-. ._|r„t l),n,- PRESIDENT OF THE BANK OF NORTH AMERICA 1827-I840 THE BANK OF NORTH AMERICA. 91 speedy method was jirovided for tlie forfeiture of 1825 the charter. In such event, at any rate, no new notes were to be issued, except to depositors of a corresponding amount of specie. Not only was the Legislature to he at full liberty to investigate into the bank's affairs, but at stipulated intervals a carefully prepared statement of its accounts was to be submitted to the State authorities. Uj^on these terms the bank was incorporated anew until April 1, 1847, with the usual corporate franchises. It was to pay as compensation eight j)er cent, per annum of its dividend to the Commonwealth, and , ,, , ' Act, March was also to loan, on sixty days' notice, at any time, ^i..i825. 8 ' J J ' J ' Smith's a twentieth part of its j)aid in capital to the State, ^^^^s, ssc. at the rate of five per cent. The bank accepted Directors' the new charter, and continued business under its Minutes, June 16, provisions. 1825. In September, 1825, the directors resolved to dispose of the shares in the bank which the insti- tution itself still held, so as to increase the caiMtal iiji^., Sep- '- ternber 19, to the chartered limit of one million of dollars, i^^s. In this way 414 shares were sold, which were Avorth id., June 182 at par $1(5.3,600, .and which, being disposed of at I'j their market value, brought the bank in a iirofit of J""e so, ' » -■■ 1825; Octo- over $33,000. >jer g, 1825. About the year 1830 began the contest relative 1830 to the renewal of the charter of the second Bank of the United States. In 1832 the stockholders of ^^''^ that institution declared their intention to apjdy to 92 A HISTORY OF 1832 CoiigT&ss foi' an extension of tlieir corporate exist- ence. In this step they were warmly seconded by the management of the Bank of North America. " We are ready," said they, " to acknowledge, and we do so with great pleasure, that the Bank of the United States has hitherto accomj^lished the objects for which it was instituted, — in the resum2:)tion of sjoecie payments under the most embarrassing cir- cumstances, in the restoration of a sound currency to the country, in the equalization, as far as prac- ticable, of our domestic exchanges, and in afford- ing that kind and salutary protection to the State institutions of a similar character, which has acted like a balance to the great commercial machine, affording assistance to the associations acting uj30n sound banking principles, and checking the erratic course of those who, in too great a desii-e to extend their profits, might Ije induced to exceed the b(junds of prudence. . . . We cannot with proj^riety for- bear to express our fears that, unless the Bank of the United States should be rechartered, we may witness scenes of unparalleled commercial distress and embarrassment, which will be felt not only in the palaces of the rich l.)ut in the cottages of the poor, the enterprising, and the industrious." They tendered, therefijre, their best wishes for the suc- cess of the bank in its application, and declared Director.'^' Minutes, their willingness to co-operate with it in any jiroper .Jiimuirv 5, 1832. ' way whicli would seem likely to effect a result so THE BANK OF NORTH AMERICA. 93 important to the wc4fare and j^i'osperity of the 1832 nation. The measure, though it met with vast opposi- tion, passed both Houses of C(jngress, and was only defeated by the interpositi(jn of tlie Presi- dential veto. The administration, flushed with this success, now prepared a sec(»nd and almost equally crushing blow to the bank's prijspects. 1833 In September, 1833, it suddenly withdrew the public deposits from the bank's vaults, and placed them in the cust(jdy of other Ijanks the manage- ment of wdiich was more in consonance with Presi- dent Jackson's views. A storm of 0|>positi(.)n was at once awakened. Among others, the Bank of North America transmitted an indignant naemorial to the members of C(jngress, praying that they would order a return of the deposits to the Bank D irGC tors' of the United States " as a sure mode of restoring Minutes, Dc- p 1 , ,. , • )) 7^ cemLer 19 coniideuce and credit to the conmuuity. Keso- i833. lutions of this purj^ort were actually passed both in the Senate and the House, Ijut with Jio eftect on the persistent ojiposition of the administration. During the period intervening Ijctweeu 1830 and 1835 183-5 a great change took j)lace in the method of conducting the bank's affairs. Business was very active, a thousand new industries were developing themselves in all parts of the count rv, and the need of banking capital was pressing in the ex- treme. But the oj^erations of the bank had for 12 94 A HISTORY OF 1835 Directors' ilinutes, February 1 ] , 1833. The couii?c] to whom tlic Congres- sional cluir- ter was sub- mitted were James S. Smith, l^sq., Horaee Bin- ney, Esq., and John Sergeant, Esq. many years j^fi^^t l)een carried on njion a limited scale and liy antiquated methods, so tliat tlie directors now found tliemselves unal)le to compete successfully witli many of the new banking insti- tutions which were growing uj) around them. Fortunately, just at this ciisis a material change took jdace in the board of directors. A number of gentlemen, who were well advanced in years, either resigned or died, and their places were sujv plied by others who were more j^erfectly acquainted with the requirements of modern business. Under their auspices im])ortant reforms were sj^eedily in- augurated, and the liank soon restored to a ^^romi- nent position in the mercantile transactions of the time. So extensive was the business now done by the bank that the directors in 1833 seri(jusly began to consider the advisability of widening the sj)hcre of its usefulness Ijy an increase of the capital stock. The first thought was that perhaps this might be effected in pui'suance of the original Congres- sional charter. But the design was S(joii aban- doned. The charter in question was sul)mitted to eminent counsel for their opinion as to the con- tinued existence of the powers conferred thereby. That ojunion was most distinctly adverse. " AVe think," said the gentlemen C(jnsulted, " that neither the bank nor the stockholders have any corporate faculties or capacities but such as are derived from THE BANK OF NORTH AMERICA. 95 the laws of Penns^'lvania, and that no act they can 1835 do can confer or revive any other corporate facul- Directors' . . Minutes, ties or CapaCltlCH. November , , 11. 1»3°- Another c<:»ur8e was theret(.)re adopted. In De- cemher, ISoo, it was resolved to petition tlie Legislature to iuitliorize tin increase of tlie capital stock to three millions of dolhii's. It was pointed out that the charter of the Bank of the United States would expire in the folLnving March, and that the demand for l)anking capital would then have to he sup}>lied from (ither sources. Hence it was argued that the LegisLiture could enterttiiu no reasonalde d(_)uht ;is to the utility and |>ropriety ibia., De- . ^^ cember \yy 01 the proposed extension, ^^o etirnest was the and 31, i835. wish of the Ijank t(_> succeed in this measure that the president was despatched to Harrislmrg, and 1830 there renuuned for some time in order to " nurse Ibid., Fob. 1 the hill." It fuled, however, fortunately for the and 8, i836. bank, to secure the tavor of the Legishiture. In the spring of the year 1837 the un})aralleled 1837 business prosperit}' of tlie past few years ended in a panic of alarming magnitude. On M;iy 10 tlie banks in New York generally susjieiided sjiecie payments. On the 11th the Ijanks in Philadel- phia were forced to follow their example. The 11, 1,8.37. " Bank of Xortli America at once resolved to put itself in a tit posture f(.)r resumption. Eesohi- tioiis were immediately introduced into the board of directors calculated to lirimr tibout a coii ,1- \.\\f da!-- - : ■ "- '• ■-■;U. 'i V- )■<, i'' h/fj)i<,trar\ • ; ui' iiit- .lci.i:ai.'- "i ihc !>aukp hv/M (.Jcti.ilti'i ,s, lS;j'..*, 1 pfopi^si' the ili'lcpitcs oT l!i( Si'liaylkii; ;• 'lanks geiiei':i!l 1' --i".i!'d a-^'fir- iiljligatioii- u; -;,■••■ ,^ . Tlji 'ly a vote < 'i i)!':e iiHTiivr-. t -^ Aiufrica '■:,>rii'iL;- i;-< bal!.-' , :. '?■ •* '■hf Jiext (lav iioikx- was i'^eiw =zVtLu. PRESIDENT OF THE BANK OF NORTH AMERICA 1840-1857 7 THE BANK OF NORTH AMERICA. 97 that tlie Bank of tlie United States liad agreed to 1839 suspend, and that the Philadelpliia Bank and the Faruiei's and Mechanics' Bank liad followed its example. The Bank of Xorth America "was, of course, forced to take similar action, though, un- like many of the other banking institutions, it , , . . . „ Directors' contniued to redeem m com its (jwn n(jtes oi a Minutes, 1 ■ ,• /"111.- 1 October 9, denomniation oi |)0 or under. 1839. On August 18, 1840, Henry Nixon, the presi- 1840 dent of the l)ank, died. He had served the insti- tution for nearly eighteen years. On September ibid., Sep- 3, 1840, John Richardson was elected to the office, i840. the duties of which he continued to discharo;e for nearly seventeen years. ^Meantime, although the banks were generally preparing to resume, much distress and actual suf- fering were entailed on the community liy reason of their susj^ension. The banking laws of the State imposed severe penalties, and prescribed various disaliilities, \\\)()\\ all banks who should fell to meet their obliga- tions in specie. By the terms of the charter of the Bank of North America that institution was during the period of its suspension subject at any time to be deprived of its franchises by proclamati(jn of the Executive of the Commonwealth, and, in addition to this, was strictly forbidden to make any new loans, to declare any dividends, or to issue any of its own PampWet , • 1 • 1 J 1 11 Laws, 1825, notes, exce2)t to dej^ositors wIkj miglit demand them ss. 98 A HISTORY OF 1840 in lieu of tlieir deposits. Somewliat similar pro- visions had been inserted '\\\ the charters of most of the other Pennsylvania Ijanks. It may, therefore, be readily conceived how great and how well founded was the prevailing apprehension. Not only were all the banks lialjle at one IjIow to l»e swept out of existence, but they were unable to distribute dividends to their stockholders, advance loans to their customers, or afford a medium of exchange for the community, without directly contravening the j^rovisions of the charters to which they owed their existence. The Legislature was, therefore, forced to inter- Laws, 714. vene. Jjy an act approved Ajirii b, lb40, the banks were given until January lo, 1S41, to re- sume the 2^fiynient of sjjecie, and until that tin\e they were exempted from the penalties imposed upon suspending banks, and enabled to issue their own notes, to grant loans, and to declare dividends, provided, lujwever, that the latter did not exceed six per cent, per annum upon the capital stock. Towards the close of the year the l)anks again began to make pre}>arations to resume. The Bank of the United States alone seemed uneipial to the task. The other banks of the city therefore ad- vanced t(j it a temj^orary bjan of live millions of dollars, which it was hoped would rescue it from its Minutes, embarrassmeuts. The proportion of this amount i84u/ "" " ' I'urnished by the Bank of North America was THE BANK OF NORTH AMERICA. 99 $400,000, and for this sum it was given post-notes, 1840 payable at tlie expiration of eighteen months. On January 15, 1841, the city banks generally 1841 complied with the requirements of the act of As- sembly, and announced their intention to redeem all their liabilities in specie. But the favorable expectations of the community were doomed again to be disa2:)pointed. At the ex2:»iration of just three weeks from the general resum])tion, the Bank of the United States a third time suspended, declared ^ . ^ Directors' itself unalde to meet the demands of its creditors, Minutes, T ebruary 4, and so ended its long and chequered career. Its ^s-^i- assets were found to consist of a great mass of securities, some worthless, and some, in the dis- turbed financial condition of the country, abso- lutely inconvertible. Certain of these assets were ^ilaced in the hands of trustees to discharge the ^ -[ -, . -, lieport of loan of five millions ot dollars already mentioned. Comptroller . 1 /I 1 • " 1 1 °*' Currency l)ut ]t was many years Ijetore their cash value was of United ,. -, n 1 ' i"^ -1 -1 States, 187C, realized and the loan entirely repaid. 15. A meetino- of the deleo-ates from the Philadel- jiliia banks was summoned on February 4, to take into consideration the l:)est course for the liaiiks to pursue. They recommended the continuance of specie payments, but the scheme was found im- practicable. On the following day every bank in Philadelphia announced its intention to susj^end, at least to some extent. The Bank of jSTorth America declared itself willing to redeem its five. 100 A HISTORY OF 1841 ten, twenty, and fifty-dollar notes in coin, but as Directors' to the rest of its liabilities declined to meet tlieni Minutes, February 5, in tlic Same manner. 1841. All the distresses and anxieties occasioned by the stringency of the laws against suspension were now felt anew. The banks were again rendered liable to the prescribed j^enalties, and Avere in con- stant fear of forfeiture of their charters. But few new bank-notes were put in circulation. Scarcely any assistance was afforded hy the banks to the mercantile community. Nor could the stockholders see anjr reasonable pros2)ect of realizing dividends from their investments in the capital stock. To crown all, the credit of the Btate had begun to fail. The taxes levied in 1840 had very far fallen short of the amount necessary to pay the interest on the State loans. In addition to this there was a large sum owing for public ini|)rovemeiits, which had been commenced in the 2:)rosperous times before 1837, and which were now left, many of them half JUonthiy Completed, a burden in the hands of the Common- G9r wealth. In order to meet these vast expenses the Legis- lature enacted a Ijill, which has generally been termed the " Relief Act," the j'urpose of which was to extort from the Ijanks of the Common- wealth a large advance to the State Treasury. By the provisions of this act a State loan of three mil- lion one hundred thousand dollars was authorized. THE BANK OF NORTH AMERICA. 101 payaLle at tlie expiration of ^\\(i years, and l)earing 1841 interest at the rate of five jier cent, per annum. Any Ijanl: in the Commonweahh was to lie at lib- erty to snbscril.ie to this loan t(j the extent of sev- enteen and a half 2)er cent, of its paid in capital. Payment was to he made to the 8tate in notes of the bank to the amount subscribed. ^Vs long as these notes remained outstanding the l»ank was to receive from the State interest at the rate of one per cent, ujion the loan. But on presentation of . these notes at the Ijank a corresponding amount of the State loan was to be issued to the holder, upon which the liank was to renuiin liable fir five per cent, interest until paid. The notes thus issued were to be receivable for delits due the Common- wealth, and could be reissued either from the State Treasurj' or from the liank issuing them. In addition t(_) this, any bank in the Cdmnion- wealth was enabled, on the deposit of State loan with the Treasurer of the Commonwealth, to an amount of not less than five and not m(_ire than seven per cent, of its paid in capital, to issue a like amount of its own notes, Imt interest was t(_i Ije en- tirel^y suspended on the stock so deposited. Any fiank com2:ilying with both the foregoing provisions was relieved and exempted from all penalties and forfeitures theretofore imposed for suspension of the payment of specie. If, on the contrary, any bank should decline within forty days to accept 102 A HISTORY OF 1841 Ijoth of tliese jirovision.s, it was declared to remain subject to all the penalties and forfeitures in ease of suspension j)rovided l)y existing laws. Gov- ernor Porter vetoed tliis Lill, but on its return to tlie Legislature more than two-thirds of each House pronounced in its favor, and on May 4, Pamphlet -< o n • i • ^ Laws, 307. lo41, it was euactcd into a law. Most of the Pennsylvania Ijaiiks were only too glad to purchase immunity on the stipulated terms. But in this course they were iKjt followed by the Bank of North America. A careful consideration of the provisions of the act satisfied the manage- ment that the bank w(juld have everything to lose and nothing to gain l:)y their acceptance. One hundred and seventy-five thousand dollars would in that event have to Ije invested in the five per cent, loan, and at least fifty thousand d(jllars of State loan de^^osited with the Government. In return, the l^ank would be at liberty to issue 1225,000 of notes, |17o,000 of which w(.)uld have to be paid into the Treasury of the State, while the remaining !|oO,()()t) could l_)e paid (jver the counter. But little, if any, profit could be ex- pected from either of these issues. As to the 1^50,000, the l)ank would have to pay five per cent, interest to the State for the privilege (jf issu- ing it, f)y reas(ni of the cessation in the payment of interest on the corresi^onding amount of State loan deposited with the Treasurer ; and even if THE BANK OF NORTH AMERICA. ]0£ the bank sliould succeed in loaning the whole 1841 amount to customers at tlie rate of six per cent., thus yielding a, profit of one per cent., the trifling sum of $3000 per annum alone would he real- i/.ed, from which was to l>e deducted the expense of preparing the notes and sustaining them in circulation. As to the 1170,000, there seemed little chance of anything l)ut ahsolute loss. Upon the redemp- tion of the notes issued fcir that sum, the burden upon the bardc must inevitably assume one of two forms, — either the holdijig of the five per cent, loan until repaid, thus abstracting almost one- fifth of the caj)ital, or else an assumption of an obligation for the payment of the interest thereon, thus creatin"' a mortiiaoe of indefinite duration on the assets of the l)ank. "The banks of this city cannot be justified," said the directors, " in pai'ting with more of their availal:>le means. Causes well known to all have forced the most prudent of the institutions into a 2iosition which, although we trust not n(j\v danger- ous, will certainly become so, except under the guidance of sound discretion in their future coun- sels, and will postpone indefinitely a. return to specie payments, to the restoration of which our aim should be steadily directed, since whatever inducements anv other institutions may have to render more proljaljle the recovery of heavy loan.s 104 A HISTORY OF 1841 by a general depreciation of tlie currency, the in- terests of this bank will be Ijest promoted by maintaining the highest standard com2:)atible with existing circumstances." There were in addition other features of the act which rendered it peculiarly ol^noxious to the • bank. Its constitutionality was not beyond dis- pute, nor were the jjroffered immunities extended beyond exemption from penalties titer etof ore en- acted. Much of all that could be gained by compliance with its terms it was thought the bank would be allowed, at any rate, from necessity, to enjoy in common with the loaning banks. Besides, the directors were of opinion " that attempts to pro- pitiate legislative power by pecuniary sacrifices are essentially unwise and dangerous, inasmuch as they invite new aggressions, which will l)e limited only by the final inability of the exhausted institutions to pa}^ the 2^rice of further exemption." A report embodying the views above set forth Directors' was j^rescuted to a meeting of the stockholders .June 8, 1841. couveiied ou Juuc 10, 1841, and it was finally agreed b}^ them that the bank should decline to accept the provisions of the act. A few of the other city l)anks adoj)ted the same course, the wis- dom of which was speedily justified. So strong did the Bank of North America now Ibid., June 28, 1841. feel that on June 28 it announced its readiness to Ibid., .Tune 10, 1841. CI THE BANK OF NORTH AMERICA. 105 pay all of its own notes in specie, on deniaml. In 1841 order, however, to avoid coinplicati(jns, it soon after resolved to receive no new acconnts, either from l)anks or individnals, nor wonld it accept more tlian one thonsand d(dlars in any one day on Icposit from an}^ (jf its former cnstomers. By the beginning of the year 1842 the Legisla- \^\i tare again became uneasy at the continued state of suspension, and requested tlie l^anks generally *" _ Directors' throughout the State to fui'uish information as Minutes, ■^ _ _ January 20, t(_) when they deemed resumption practicaljlc. ^^^^-■ To this re(piest the directtjrs of the Bank of iS'orth America promptly replied that they had redeemed all their notes, except about |24,000, which they would jiay (_)n demand in specie ; that they had few deposits which were not by express contract payable in current funds ; that their out- standing loans were strictly on business paper, in small amounts ; and that they were pre2>ared to resume as soon as the currency was raised to the standard of gold and silver. In order to accom- 2)lish this result the}' ventured to suggest that the Legislature should take speedy steps to raise the credit of the Commonwealth, so that those banks which had portions of their cajntal locked \v^ in State loan, might convert it at a. reasonaljle rate, and thus meet their outstanding oldigatious. They recommended too, that some method should l)e ii,id.,jan- adopted for withdrawing the notes issued under isiL'." ' 106 A HISTORY OF 1842 the iirovisions of tlie " Kelief Act." Until these measures were accomplished any attemjit to return to a specie basis they feared would prove abortive. To these wise counsels the Legislature paid no Pamphlet i i -r> n t\ r i -i n -i o in • Laws, 08. heed. By an act aji2:)roved March 11, iy4z, im- mediate resumption was commanded on the part of every bank in the Commonwealth, without any provision being made for the jiayment of interest on the State loans or the retirement of the " relief" notes. As a consequence, great difficulty was ex- perienced by many of the banks in comjilying with the legislative mandate. On March 18 the Bank Minute.^ of Nortli America and eight other city banks re- March 21 1842. ' turned to a S2)ecie basis. But almost every bank which had accepted the provisions of the " Relief Act" was obliged to postpone the period of its re- sumption, and it was not until more than a year after, when provision had been made to replenish the exhausted Treasury of the State, and to cancel the notes issued under the " Belief Act," that coii- 17 Scribiiers' fideuce and credit were in any de2:ree restored to Monthly ■' ^ Magazine, the mercantile and financial world. 691. The Bank of North America had suffered most severely during the period which has just been described. At the opening of the year 1842 the president communicated to the directors the fact that in his o]3inion the bank stood in a most dan- gerous state. It had, in fact, about four-fifths of its capital locked up in unavailable securities, and THE BANK OF NORTH AMERICA. 107 consequently only al)out one-fifth in an actually 1842 available sliape. A persistent reduction of accom- modation loans, and of the discount line for some time again ensued as the surest means of i-est(jring Mhiuter strength to the institution. mL'!"'^' '^'' As the 3'ear went on, however, the disastrous effects of the late crisis Ijecame more and more apparent. The actual assets of the l>ank had so far depreciated in value, the prospects of realizing any considerable part of the delrt due from the Bank of the United States were so d(.)uljtful and remote, and the profits derived from the current Imsiness were so scanty, that the directors did not feel warranted in declarino' anv dividends to the stoekholders. The result was that manj^ persons were deprived of means aljsolutely essential to their sup2>ort. Application was, therefore, made to the Legislature to pass an act authorizing the reduc- tion (if the capital, a measure whicli it was justly supposed would enhance the market value of the -^^"^•^ stock, jiromote confidence in the community at large in the institution, and enable the directors to declare reasonable dividends. The ajiplication was successful. On March 24, 1843, an act to the de- sired effect became a law, cutting down the capital stock of the bank to 17-30,000, and reducing the par value of the shares to foOO. The effect was all that could lie desii'ed. In Januarv, 184l2, the half-vearly dividend had beeji 11, id. , .June 1^0 iir d 30, r841 tjiin- iiarv 1^, LS4:; Pam -.lilet L:i\v , 10',). 108 A HISTORY OF 1843 jiassed, to tlie great distress of many of tlie stock- holders. In July, 1842, a nominal dividend only of one cent per share had l^een declared in order to prevent a forfeiture of the charter. In Januai'y, 1843, the dividend was again passed. In July, 1843, but three months after the passage of the above-mentioned act, a half-yearly dividend of 1844 three per cent, was declared. In January, 1844, like action was taken, and by July of that year the directors felt warranted in distributing four per cent, on the capital to the stockholders. Business meantime was rapidly reviving. Two years of pros2)erity availed to jilace the bank upon a f(joting so firm that it felt warranted in asking for a return of the caj^ital to its old volume. Tliis was effected l)y an act of the Legislature ajiproved April l('), 1845. 1846 In 184(3 application was again made for the re- newal of the charter. But this was not effected upon very favorable terms. The Legislature in- sisted upon inserting into the new act of incor- poration a clause making tlie stockholders indi- vidually lialJe for the debts of the institution to an amount e(iual to the par value of tlieir stock. Nor was this the only ol)jectionable provision. If the bank shoidd at any time apjiear to be in failing circumstances, a summary method was pro- vided for winding up its affairs; and in the event of its assets falling below the amount of its 184.5 Pamplilet Laws, 480 THE BANK OF NORTH AMERICA. ]09 capital, tlie governor ^vas authorized and required IS-tG to renew the charter, "with a ca2>ital correspond- ingly reduced. Another feature of this act Avas the reduction of the par value of the shares to i|100 each, although their number was so enlarged as to represent the Act, April Q 1Q4(1 full capital of a million of dollars. p'lnniihiet rrn • 1 T A •! r, -.111. n Laws, 1847, inis act bore date April 8, 1840, ami was ac- so. cepted 1)y the stockholders on January 11, 1847. 1547 By its terms the corjiorate existence of the bank ptockii.iia- was continued for ten years from the expiration of jiuumry'ii^i^' tlie former charter. 14 110 A HISTORY OF CHAPTEE VII. 1847-1S82. Erection of the present Banking-House in 1847 — Renewal of tlie Charter in 1855 — The Panic of 1857 — Resignation of John Richardson from tlie Presidency in 1857 — Election of James N. Dickson, and his Resignation in 18G0 — Election of Thomas Smith as President — The War of the Rebellion — Assistance afforded to the Government by the Bank from ISCl to 1864 — Loyalty of the Bank — Its Reorganization as a National Bank in 1864 — Retention of its Old Title without the usual Prefix " National" — Conclusion. In" tlie year 1847 tlie old building, in wliicli the Bank of Noi'tli Ameriea liad now transacted its business for u]>wards of sixty-five years, was at lengtli deemed too inconvenient and too ruinous for further oecui)ancy. It had, in fact, never been very well adapted to the pmrposes of the bank. As early as 17- n Minutes, sioii began on beptemljer 20, 18oy, and resumption September 25 rv> , n n ,i f ^^ and 2G, 1857. was eflected by the loliowmg sin'ing. On April 27 of the same year John Richardson presented to the directors his resignation from the position of president, assigning as his reason the very close confinement necessitated Ijy the duties of the office. The resignation did not, however, go into eftect until the July tbllowing, when the directors took the opportunity to express their appreciation of his "soundness of judgment and promptness of acti(jn, his strict adherence to right princij)les, and his zealous, untiring devotion to the interests of the institution." " The whole of Ibid., April 27, 1857. A /^'/STOffi' ■'■/■ 'i\(\ tht.ro ir:i!.."iif'' 'i , !(.- it iiiivv ^i.rtiu' -..' -; !• ,;• '.r ''^'■•i.i'i v, ;:•■: < ,•'■ ■ .. h,--'':.j'::^ '. •'Iiei.l Mil ,!lliiv i 'v. 'i'M .'•-'. ..f-'i-;:! Wits i.''iri!}n'!l(-M| aoiii!! : • '?■ -.-■:.'■ <■<■ --'-'u. the itliur *i:niks of lii* ■ ! - ■ i ■• vniCHt iii ■jM■^•i(^ !^u! ■■' .?i"i'ti>rs hi- ,1 -'■inii '.ifi -'uiij! thi; •■ i!.ii1, ;is-!, ii(iu.:\ ■! *5i.'rt iiiiUi th !';iy tci!.!.; ' ■■■ vhi'!) 'h • : -)k t!n' 1 •:;■'. ^iJiUiy '!■ :>■ '.I'l i.| ill, ■ -'■■]■. ' I''.- ■ i' ■ ,' ,i. J PRESIDENT OF THE BANK OF NORTH AMERICA 1857- T860 THE BANK OF NORTH AMERICA. 113 tlie long period during wliich lie was in office," 1857 tliey declared, " liad l^een marked by the most un- interrupted harmony and mutual respect, and, on the part of the hoard, by the highest regard for j-l n T • (' i\ r -r> • 1 i Directors' tne excellent qualities oi Mr. lucliardson as an Minutes, m-, ,, July 16, cer and a man. 1807. On July 10, 18-37, James N. Dickson was elected to fill the vacancy, hut his term of office extended ibid, over little more than three years. On August 9, 1 ^Pfl 18G0, he presented his resignation, and on the 20th of the same month Thomas Smith was chosen as "^^^'f;,^!!;^ gust 9, 18G0. his successor. Mr. Smith has now Ijeen in office ,,, Ibid., Au- for upwards of twenty-one years, a longer period S"st 20, i8no. than any previ(jus president of the institution. AVhen the War of the Kebellion broke out, the 1861 Bank of North America, was among the first of the banking institutions of the country to declare its unabated confidence in and regard for the National Government. Loyal alike from inclination and from a profound sentiment of gratitude to the power that had first brought it into existence, it hastened to take measures to aid in the preserva- tion of the integrity of that National Union which it had done so much to pr(.)mote. On April 22, ISOl, the directors, by a unani- mous vote, appropriated the sum of if-lOOO t(j the Oommittee of Public Safety, in order to provide for the defence of the city and the preservation ^^ .^ ^ .^ of the puljlic peace. ^^' ^^^'^- 23, 1801. Ibid., Au- !>-ustl7, 18G1. Hi A HISTORY OF 1861 In tlie following May it agreed, in common with Directors' the Other baiiks of the city, to suh.scribe for its Minutes, p tt • i ri m May 23, pvo rata share ot Llnitecl otates ireasnry notes. In Jnly it loaned to the United States directly the sum of $100,000 in coin for sixty days, at six per ,-, . 1 T , cent, interest, ap'reeinf;- that the advance mig-ht be Ibid., .July 'SO O returned either in kind or in 7.30 notes. In Au- gust it subscribed $400,000 for these same 7.30 Ibid., Sep- notes, and in September took \iii pro rata share of t (? iTi b 6 r '^ -J 18G1. " ' $50,000,000 on the same security. In November Ibid., No- it subscribed for its 'pro rata share of $5,000,000 vember Hi, 1861. in United States six per cent, bonds. Ibid., Dc- On December 31, 1801, the bank was forced, in ceraber 31, 1861. common with the other banking institutions of the country, to sus[)end the payment of specie. But this occurrence by no means diminished either its ability or its disj^osition to aid the national cause. 1802 On February 28, 1802, it made au advance to the Treasury of $300,000 at five per cent, interest, on Ibid., Feb- coiiditioii that the amount should be returned on ruiirv 28, , -i i . • • i • i 1862'. ten days notice, in kiml. On July 3 $300,000 more were invested in Ibid.,. July 3, -TT • n r. • • /-^ t i ^ 1862. United htates securities. On July 28, at a meet- ing of the directors, the following resolutions were unanimously adopted : WIiercai<, This bank was instituted in 1781 to aid the coLniies in their struggle for independence ; And wlicrcas, It has ever since prospered under the Government it assisted in creating ; ||i|('.5 l\ ^ Bi S/« -1 ^'\\ S^.^^.i^^./^^ ^ THE BAAK OF NORTH AMERICA. 115 And v:heyeas, In carrying out the policy of 1862 making contriljntions to sucli objects only as are within its legitimate sj)here, tlie stability of the Government is most essential to the interests of the stockholders ; it is, therefore, Brnoh'cd, That the sum of five thousand dollars be Cfjntributed liy the Ijank, and disposed of in such ]nanner as the president may deem most ex- 1 • i i • J. A_i r\ • ... Directors' pcoieiit to assist the (jrovernment m manitammg Minutes, • , • , •, July 28, its mtegnty. ign^ During the year 1803 the same policy was pur- 1863 sued. During the month of May the sum of $000,000 was invested in United Sttites twelve ibjd., jmy months' certificates. In July the sum of .|;40,000 ^^^ -^' was loaned to the State to aid in the payment of its troops. In the same month half a million more ^T^lAGi"'"' of United States twelve UKinths' certificates were i^jj taken, and in Xovemlier the sum of |100,0(J0 was ibid., n.i- T • 1 T^ • 1 ri — » - veniber 2, invested in the L inted States /.oO notes. i863. On Januai'y 14, 1S04, the president was author- 1864 ized to advance at proper times still further sums on the United States twelve months' certificates, but the amount of these securities held never exceeded ibid., Jan- •11- n 1 IP p 1 11 ^^ uarv li, at any one time a miJlion and a halt ot dollars. A or isul, was tlie mere advancing of money t(j the Ciovern- ment the only method which the liank took (if tes- tifying its jiatriotism. It advanced at vaiaous times to individuids no less than two millions of dol- kirs on the deposit of United States securities as 116 A HISTORY OF 18Gi Directors' Minutes, May 26, 1864. See Appen- dix. Letter, Thomas Smith, Esq., President of the Bank, to Hon. Hun-h MoCuUocli, Oompti'oller, etc., Novem- ber 1, 1864. See Appen- dix. collateral. And in order to stimulate tlie em- ployes to volunteer for the nationad defence, it was resolved by tlie directors that the salaries of all clerks who might be absent on the service of the State, or of the United States, should be continued as though no interruption to their daily laliors had taken jilace. In Octoljer, 1864, a correspondence was ojiened with the Comptroller of the Currency in Wash- ington, looking to the reorganization of the insti- tution as a national Ijank, under the " National Currency Act," passed by Congress June 3, 1864. A step more in keeping with the traditions and history of the bank it would be hard to conceive. Created by Congress, tmd fostered under national auspices, it was only by the force of circumstances, and the unfortunate prevalence of the State Eights' feeling, that it had been forced into the position of a State institution. It had already given am2:»le evidence of its loyalty to the national cause. It had advanced four and a lialf millions of dollars, or four and a half times the amount of its capital stock, on United States securities, and it now em- Ijraced the opportunity of resuming its former in- timate relations with the National Government. Much feeling, however, prevailed, both among the directors and the stockholders, against any change in the old cor2)(.)rate title of " The Bank of North America." It was felt by them that the addition THE BANK OF NORTH AMERICA. 117 of the word " National," as was customary on be- ISG-t eoniing a national Lank, was, in tlie case of the Bank of Xorth America, Luth unnecessary and ill-advised. Its original national name conferred U2)on it l)Y Congress, as well as its original national character, had always been, and still continue to be, matters of great pride to those interested in the institution. These views were presented at great length to the Comptroller of the Currency in a letter from the jn'csident of the bank, but failed at . . See Appen- nrst to meet with Ins approl)ation. dix. On N(jvember 14, 18(U, the stockholders met to consider the propriety of becoming a national bank. The requisite two-thirds vote approving the change was readily obtained. It was resolved that the State charter should be surrendered, that new articles of association should be executed, that the bank should reorganize under the provisions of the act of Congress, and that the assets of the old Stockhnld- corporation should be transterred to the 2)ossession eis' Minutes, November of the new. i4, 1804. These changes were at once effected. In Xo- vcmlx'r a committee of the directors was despatched to Washington to deposit the necessary securities, and immediately after the Ijank began business in its new national character. The result of the corresjiondence with the Comp- troller of the Treasury, already described, was to induce him at length to consent to the retention l:)y 15 118 . A HISTORY OF 18G4 the bank of its old corj^iorate title, without tlie prefix " ISrational." In this action he was largely influenced by a memorial signed by the j^residents of most of the other Philadelphia banks, exiu-ess- Di rectors' Minutes, inc.- their entire approval of the scheme for leaving; November ^ _ ^^ _ _ ° 23, 1864. the title unchanged. It is believed that this is the only instance in the country where a similar j^ermission was extended. 1882 A century has now passed away since the Bank of Xorth America first 02)ened its doors. It has lived to see a weak confederation of States grow into a great and prosperous nation. It has wit- nessed periods of unbounded commercial prosper- ity and others of most deplorable distress. But throughout all it has never failed, hj the mainte- nance of a sound financial 2)olicy, to command the resjiect and esteem of the mercantile and financial world. As long as it retains these it may look forward with well-grounded confidence to a future of undiminished prosperity and usefulness. ■'arik of iis ^ doorx. it ita,-i ■■ ' i'i7jK|H r- i-iiiljivtr- : ■ : . '■■n:\ liu:Uli'i-:' «.-• '- . ii may ['<<\' ■\>':diii'.-':i'.-(: til H hit:': '' ^'^^f^T^.s^V *^r^<*^^^ PRESIDENT OF THE BANK OF NORTH AMERICA ELECTED IN I860. THE BANK OF NORTH AMERICA 119 APPENDIX. LIST OF THE PRESIDENTS, CASHIERS, AND DIRECTORS OE THE BANK OF NORTH AMERICA FROM ITS FOUNDATION TO THE PRESENT TIME. PRESIDENTS. Name. Elected. Term of Office exded. Thomas Willing John Nixon . . John Morton Henry Nixon John Hichardson James N. L>ickson Thomas Smith . November 2, 1781 January 10, 1792 January 10, 1809 .January 15, 1822 September 3, 1840 July 10, 1857 August 20, 1800 Kesigned Jan. 9, 1792. Died December 31, 1808. Resigned Jan. 15, 1822. Died August 18, 1840. Resigned July 10, 1857. Resigned Aus;. 9, 1800. Name. Tench Francis . . . Richard Wells . . . Henry Drinker, Jr. . Henry Hollingsworth James Correy . . . John Hockley . . . John II. Watt . . . CASHIERS. Elected. November 20, 1781 January 12, 1792 January 30, 1800 October 30, 1822 September 17, 1840 Marcb G, 1843 May 1, 1809 TEJtM OF Office endei^. January 12, 1792. Resigned Jan. 30, 1800. Died October 19, 1822. Resigned Aug. 31,1840. Resigned Feb. 20, 1843. Resigned May 1, 1809. 120 A HISTORY OF DIRECTORS. Name. Thomas Willing . Thomas Fitzsimons John Maxwell Nesbitt James Wilson . . Henry Hill . . . Samuel Osgood . . Cadwalader Morris Samuel Inglis . . Samuel JIeredith . William Bingham . Timothy Matlack . Andrew Caldwell George Haynes . . Mordecai Lewis John Koss . . John Nixon . Samuel Powel EicHARD Bache JOSIAH HeWES Andrew Tybout Joseph Swift . . George Latimer Benjamin Fuller . MiERS Fisher . . John Swanwick John Morton . . Robert Waln . . William T. Smith . Richard Rundle Thomas Murgatroyd Gideon Hill Wells Daniel Smith . . Anthony Morris . Jacob Downing . . James Smith, Jr. . Elected. November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 1 1781 November 4 1782 January 12 1784 January 12 1784 January 12 1784 January 12 1784 January 12 1784 January 12 1784 May 29 178G January 10 1791 January 9 1792 January 9 1792 January 9 1792 January 9 1792 January 9 1792 January 9 1792 January 9 1792 January 14 1793 January 13 1800 January 13 1800 January 13 1800 January 13 1800 January 13 1801 January 10 1803 Term op Oefice exded. January 9, 1792. January 10, 1803. January 9, 1792. January 12, 1784. January 9, 1792. January 12, 1784. April 25, 1786. January 12, 1784. January 12, 1784. January 12, 1784. November 4, 1782. January 10, 1791. January 12, 1784. January 13, 1800. January 9, 1792. Resigned Dec. 24, 1808. January 9, 1792. January 9, 1792. Resigned Jan. 10, 1805. January 9, 1792. January 9, 1804. Died Juno 13, 1825. January 13, 1800. January 13, 1800. January 14, 1793. Died April 23, 1828. January 10, 1820. Died February, 1812. January 13, 1800. January 13, 1801. January 10, 1803. January 7, 1833. .January 11, 1808. January 12, 1818. January 14, 1811. THE BANK OF NORTH AMERICA. Vl\ DIRECTOR S.-CoxTiNUED. Name. Elected. TERir or Office exded. Joseph S. Lewis . . . January 0, 180-t January 12, 1818. James Read . . January U, 1805 January 13, 1823. William Wal.m . January 14, 1805 1 January 10, 1820. Timothy Paxson January 11, 1808 , Died April 21, 1839. Henry Nixon January 9, 1809 Died August 18, 1840. Benjamin R. Morgan January 14, 1811 Resigned August, 1821. Abraham Kintzing April 1, 1812 January 11, 1819. George Fox . . . January 12, 1818 Died September 9, 1828. George McCallmont January 12, 1818 January 7, 1833. Charles McAlester • ! January 11, 1819 Died August 29, 1832. Joseph Peace . . • ] January 10, 1820 Died April, 1826. Jacob S. Waln . . January 10, 1820 Resigned June 23,1828. George Roberts . September 7, 1821 January 10, 1825. Edward Penington January 13, 1823 January 10, 1825. Alexander Elmslie January 10, 1825 January 12, 1829. Richard Randolph . j January 10, 1825 Resigned April 7, 1828. Newman Cope . . . 1 January 9, 1826 Resigned March 6, 1826. Coleman Fisher June 5, 182G Resigned Oct. 9, 1843. Charles II. Ixvker June 5, 1826 Resigned Dee. 21, 1829. Furman Leaming . ; July 24, 1828 Died March, 1832. Samuel Hollingsworth July 24, 1828 Resigned Jan. 14, 1833. John Clement Stocker July 24, 1828 Diecfjuly 29, 1833. John M. Attwood . . January 5, 1829 Resigned Oct. 9, 1843. Benjamin W. Richards April 2, 1829 Resigned Jan. 18, 1830. John Miller, Jr. . . January 5, 1830 Died May 12, 1836. David Lewis, Jr. April 26, 1830 Resigned , 1840. George Handy . April 30, 1832 Resigned Oct. 27, 1834. u a May 26, 1836 Resigned Nov. 26, 1838. William W. Keen November 29, 1832 Resigned Oct. 16, 1843. " '' Marcb 17, 1845 Resigned Mar. 20,1848. u u January 6, 1851 January 2, 1854. u u January 2, 1855 January 31, 1859. John Richardson . Janiuiry 7, 1833 January 31, 1859. Richard S. Smith . January 7, 1833 ResignedAprill7,1834. Joseph P. Homer . October 31, 1833 Resi-ned Au-. 8. 1842. 122 A HISTORY OF DIEECTOE S.— Continued. Name. Charles Bird Jacob Lex . . Edward Yarnall Thomas Robins II li Thomas Allibone John B. Budd A. J. Lewis James N. Dickson Thomas M. Smith James C. Hand Elected. October 31 October 6 November 24 January 8 January 2 November 27 July 15 September 4 December 3 Marcli December January January January September 21 October 26 November 17 January 7 January 7 Januaiy 10 January 12 January 14 January 9 September 21 January October January January January October January October January January , January 3 18 5 5 6 15 2 31 1 1833 1834 1834 18.50 1854 18.34 1844 1848 1838 184G 1838 1845 1849 1853 1840 184G 1851 1850 1801 1805 1809 1873 1877 1840 1848 1852 18.57 1841 1845 1849 1854 1842 1849 1855 1801 Terji op Office ended. Resigned Oct. 27, 1834. Resigned Nov. 22, 1838. Resigned Oct. 19,1843. January 3, 1853. January 5, 1857. Resigned Jan. 30, 1843. Resigned July 12, 1847. Resigned Sept. 4, 1851. January 1, 1844. Resigned Mar. 19, 1849. January 1, 1844. January 3, 1848. January G, 1852. January 7, 1850. January 1, 1844. Resigned Oct. 25, 1849. Resigned Nov. 22, 1854. January 2, 1800. January 4, 1804. January 14, 1808. January 10, 1872. January 11, 1876. Died May, 1877. January 1, 1844. January 0, 1851. January 7, 1850. January 5, 1803. January 1, 1S44. January 3, 1848. January 3, 1853. January 5, 1857. Resigned Oct. 30, 1845. January 6, 1852. January 2, 1860. January 4, 1804. THE BANK OF NORTH AMERICA. 123 DIRECTOR S.-CONTINUED. Name. James C. Hand Elected. Stephen Baldwin MOREIS L. Hallowell John Gregg . Henry Sloan William S. Boyd Thomas T. Lea . John Dickson Benjamin T. Curtis a a Hugh Elliott John H. Brown . January 10 1805 January 12 18G9 January 14 , 1873 January 9 , 1877 January 11 , 1881 Juno 15 , 1843 January 3 1848 • October 12 1843 October 15 1849 January '> 1854 January 2 1860 October 19 1843 January 8 1850 . ' October 19 1843 . ' January 1848 January 6 1852 . ' January 7 1856 January 10 1871 October 27 1843 January 1 1844 . 1 Novcmbei 5 1849 January 2 1854 January 1 1844 Novcmbei 10 1845 Janunry G 1852 . October 12 1846 January 3 1853 October 12 1846 January 6 1851 January ■7 1855 January '7 1861 January 10 1865 . '■ January 12 1869 . , January 14 1873 January 9, 1877 Term of Office ended. January 14, 1868. January 10, 1872. January 11, 1876. January 13, 1880. Resigned Oct. 1, 1846. January 6, 1851. Resigned Oct. 8, 1846. Resigned Oct. 11, 1852. January 5, 1857. January 7, 1862. Resigned Oct. 1, 1846. Resigned Sept. 1, 1851. Resigned Oct. 12, 1840. January 6, 1851. January 1, 1855, Resigned Deo. 10, 1858. January 14, 1873. Resigned Feb. 12, 1840. January 5, 1847. January 3, 1853. January 5, 1857. Resigned Jan. 2, 1845, Resigned Nov. 20, 1848. January 1, 1855. Re.signed Oct. 11, 1849, Resigned May 10, 1853. Resigned Oct. 18, 1849. January 2, 1854. January 2, 1800. January 4, 1804. January 14, 1808. January 10, 1872. January 11, 1870, January 13, 1880. 124 A HISTORY OF DIRECTOR S.-CoxTiNUKD. Name. John H. Brown Jacob P. Jones Paul W. Newhall Thomas Smith Lewis Audenried Wm. G. Audenried William L. Rehn John H. Irwin . John M. Wiiitall Charles S. Lewis Ele CTED 1 Term of Ofeice ended. . 1 January 11 1881 October 12 184G 1 Resigned Oct. 15, 1849. Novcmbei 17 1851 1 Resigned Nov. 20, 1854. January 7 1850 \ January 2, 1860. January 5 18G3 January 9, 1S66. January 8 1807 i January 12, 1870. January 10 1871 : January 13, 1874. January 12 1875 1 January 10, 1878. January 14 1879 January 5 1847 1 Resigned Feb. 17, 1848. January C 1851 January 2, 1854. January 2 1855 1 Re.signed Feb. 10, 1859. January 2 18G0 January 1853 January 7, 185G. January 5 1857 January 7, 18G1. January G 18G2 January 10, 1865. January 9 ISGG January 12, 1869. January 12 1870 ' January 14, 1873. January 13 1874 , January 9, 1877. January 8 1878 January 11, 1881. January 5 1857 January 7, 1861. January 6 18G2 January 10, 1865. January 9 18GG January 12, 1869. January 12 1870 January 14, 1873. January 13 1874 Resigned Jan. 15, 1874. January 5 1857 January 7, 1861. January G 1862 January 10, 1865. January 9 18GG January 12, 1869. January 12 1870 1 Died Marcli, 1870. January 31 1859 January 6, 1862. January 5 1863 January 9, 18G6. January 14 1868 January 10, 1871. January 31 1859 ; January G, 1862. January 5 1863 January 9, 1866. January 8 1867 1 January 12, 1870. THE BANK OF NORTH AMERICA. 125 DIRECTOR S.-CoxTixuED. Name. Elected, TjjrtM OF Office exded. Charles S. Lewis Henry Lewis David Scull Israel Morris James 0. Pease Charles Vezin John P. Levy Lemuel Coi'Fin William B. Kempton John H. Michener Henry Winsor January January Jan aary January January January January January January January January Januar)' January- January January- January Januarys January- January January January January January January- January January January- January January January- January January January January January 10 10, 1871 12, 1875 14, 1879 31, 1859 5, 1863 8, 1867 10, 1871 12, 1875 14, 1879 2, 1860 4, 1804 14, 1868 10, 1872 2, 1800 10, 1805 12, 1869 13, 1874 8, 1878 2, 1800 4, 1804 0, 1802 9, 1800 4, 1804 14, 1808 10, 1872 11, 1876 13, 1880 14, 1868 10, 1872 11, 1876 13, 1880 10, 1871 12, 1875 14, 1879 10, 1872 January 13, 1874. January 10, 1878. January 0, 1802. January 9, 1866. January 12, 1870. January 13, 1874. January 10, 1878. January January Jamiary January- Jan uary January- January January January January- January January- January January January January- January 5, 1863. 8, 1807. 10, 1871. 13, 1875. 5, 1803. 14, 1808. 10, 1872. 9, 1877. 11, 1881. 5, 1803. 8, 1867. 10, 1805. 12, 1869. 8, 1867. 10, 1871. 13, 1875. 14, 1879. January 10, 1871. January 13, 1875. January 14, 1879. January 13, 1874. January 10, 1878. January 13, 1875. 126 A HISTORY OF DIRECTOR S— Continued. Name. Elected. Term of Office ExVded. Henry Winsor . . January 11, 187G January 14, 1879. u a January 13, 1880 Clement A. Griscoji January 3, 1874 January 9, 1877. ti a January 8, 1878 January 11, 1881. George W. Fiss . . February 12, 1874 January 9, 1877. U iC January 8, 1878 January 11, 1881. Theodore C. Search January 9, 1877 January 10, 1878. U ^i January 11, 1881 William Simpson, Jr. May January 11, 1877 11, 1881 January 13, 1880. Pi. H. Downing . . . January 8, 1878 January 14, 1879. THE BANK OF NORTH AMERICA. 127 II. On tlie 17tli day of May, 1781, tlie folloAYing Plan was submitted to tlie consideration of the United States in Con- gress assembled : PLAN FOR ESTABLISHING A NATIONAL BANK FOR THE UiNITED STATES OF NORTH AMERICA. 1st. That a Subscription be (Opened fjr fjur hundred thou- sand dollars, in Shares of Four hundred dollars each, to be paid in Gold or Silver. 2d. That the suljscription be paid into the Hands of Geoi'ge Clymer and John Nixon, Esqrs., or their agents. ;xl. That every subscriber of less than five shares pay the whole sum on the day of his suljscription. 4th. That every subscril^er of Five Sliares, or u}>wards, pay one-half the Sum on the day of liis suljscription, and the (jther half "within three months of that day. .3th. That every holder of a share shall l)e entitled to a vote Ijy himself, his agent, or jJi'Oxy, pr(.)perly a2)2)ointed, at all lldections of Directors, and that he have as many v(jtes as he hold shares, aiid that every Subscriljcr may Sell or Trans- fer his Share or Shares at his pleasure, the Transfer being- made in the Bank Books, in presence and with the apjn-oba- tion of the jiroprietor or his Lawful Attorney, the purchaser then to become entitled to the I'ight of Voting, &c. Gtli. That there be Twelve Directors chosen from amono; 128 ^ HISTORY OF those entitled to vote, who, at their first meeting, shall choose one as President. 7th. That there be a meeting of the Directors Quarterly, for the purpose of Regulating the affairs of the Bank, and seven of the Directors to make a Board, and that the Board have power to adjourn from time to time. 8th. That the Board of Directors determine the manner of doing Business, and the Bules and Forms to be pursued, ajipoint the various Officers which they may find necessary, and dispose of the IMoney and Credit of the Bank for the Interest and Benefit of the proprietors, and make from time to time such Dividends, out of the Profits, as they may tliink jjroj^er. Dth. That the Board be empowered from time to time to open new subscri[)tious, for tlie purpose of increasing the Caj)ital of the Bank, on such terms and conditions as they shall think j^roper. 10th. That the Board shall at every quarterly meeting Choose two Directors, to inspect and control the Business of the Bank, for the ensuing three months. 11th. That the Insjjectors so chosen shall, on the evening of every day, Sundays excepted, deliver to the Superintendent of the Finances of America a state of the Cash account, and of the Notes issued and Received. 12th. Tliat the Bank Notes, jiayable (_)n demand, shall by Law Ije made receivable for the Duties and Taxes of every State in the Union, and from the Respective States, l)y the Treasury of the United States, as specie. loth. That the Superintendent of the Finances of America shall have a right, at all times, to examine into the affairs of tlie Baid<, and for that purpose shall have access to all the Books and l*apers. 14th. Tliat any Director or Officer of the Bank, who shall THE BANK OF NORTH AMERICA. 129 convert any of the property, monies, or credits tliereof, to liis own use, or shall in any other way Ije guilty of Fraud or Em- bezzlement, shall forfeit all his share or stock to the Company. loth. That Laws shall be passed making it felony without Benefit of Clergy to commit such Fraud or Embezzlement. 10th. That the Subscribers shall be Incorporated under the Name of " The President, Direct(jrs, and Company of the Bank of Xorth America." 17th. That none of the Directors shall l)e entitled to any ]3ecuniary advantage for his attendance on the duties of his office as Director, or President, or Inspectoi-, unless an altera- tion, in this respect, shall hereafter be made by the consent of a majority of the Stockholders, at a general election. 18th. That as soon as the Subscri^jtion shall be filled, George Clymer and John Kixon, Esqrs., shall publish a list of the names and sums respectively subscribed, with the place of abode of the Subscriljers, and appoint a day for the choice of Directors, to whom, wdien chosen, they shall deliver over the Money by them received. 130 A HISTORY OF III. By the United States in Congress assembled, December 31, 1781. AN ORDINANCE TO INCORPORATE THE SUBSCRIBERS TO THE BANK OF NORTH AMERICA. Wliereas, Congress, on tbe twenty-sixth day of May hist, did, from a conviction of the snpport which the finances of the United States would receive from the establisliment of a national bank, approve a jilan for such an institution, sub- mitted to their consideration by Robert Morris, Esq., and now lodged among the archives of Congress, and did engage to promote the same by the most effectual means ; and whereas, the subscrij^tion thereto is now filled from an ex- pectation of a charter of incorporation from Congress, the directors and president are chosen, and application hath been made to Congress by the said j)resident and directors for an act of incorporation ; and whereas, the exigencies of the United States render it indisjiensably necessary that such an act be immediately passed. Be it therefore ordained, and it is hereby ordained, by the United States in Congress assembled, that those who are, and those who shall become, subscribers to the said bank, be, and forever after shall be, a corporation and body j)olitic to all intents and purposes, by the name and style of The Peesi- DEXT, DiEECTORS, AND CoMPAXY OE THE BaXK OF NoETH Ameeica. THE BANK OF NORTH AMERICA. 131 And l)e it further ordained, that the said corporation are hereby dechired and made able and cajiable in hxw, to iiaye, purchase, receive, possess, enjoy, and retain hinds, rents, tenements, hereditaments, goods, eliattels, and effects, of wliat kind, nature, or quality soever, to the amount of ten millions of (Spanish silver milled dollars, and no more ; and also to sell, grant, demise, alien, or dispose of the same lands, rents, tenements, heredhaments, goods, chattels, and effects. And be it further ordained, that the said corporation be, and shall be, forever hereafter, aide and capable, in law, to sue and be sued, plead and be impleaded, answer and be answered unto, defend and be defended, in courts of record, or any other place whatsoever, and to do and execute all and singular other matters and things that to them shall or may appertain to do. And be it further ordained, that for the well governing of the said corporation, and the ordering of their affairs, they shall have such officers as they shall hereafter direct or appoint, provided, nevertheless, tliat twelve directors, one of whom shall be the president of the corporation, be of the number of their officers. And Ije it further ordained, that Thomas Willing be the present president, and the said Thomas Willing and Thomas Fitzsimons, John Maxwell Nesljitt, James Wilson, Henry Hill, Samuel Osgood, C*adwaladcr Morris, Andrew C\ild- well, Saanuel Inglis, Samuel Meredith, William Bingham, and Timothy Matlack be the present directors of the said corporation, and shall so continue until another 2>rt'sident and other directors shall be chosen according to the laws and regulations of the said corj^oration. And be it further ordained, that the president and direc- tors of the said corj^oration shall be capable of exercising such power for the well governing and ordering of the affairs 132 A HISTORY OF of the said corporation, and of holding such occasional meet- ings for that purpose, as shall be described, fixed, and deter- mined by the laws, regulations, and ordinances of the said cor230ration. And be it further ordained, that said corporation may make, ordain, establish, and put in execution such laws, ordinances, and regulations as shall seem necessary and con- venient to the government of the said corporation. Provided always, that nothing hereinbefjre contained shall be con- strued to authorize the said corporation to exercise any powers in any of the United States repugnant to the laws or constitution of such State. And be it further ordained, that the said corj^oration shall have full power and authority to make, have, and use a common seal, with such device and inscription as they think jiroper, and the same to break, alter, and renew at their pleasure. And be it further ordained, that this ordinance shall be construed and taken most favorably and beneficially for the said corporation. THE BANK OF NORTH AMERICA. 1 'lO IV. ALPHABETICAL LIST OF THE FIRST SUBSCRIBERS TO THE BANK OF NORTH AMERICA, TRANSCRIBED FROM THE ORIGINAL SUBSCRIPTION-PAPER, 17!] 1, J 702, 1783. Tliis ,sul)Scription was for 1000 shares at 400 dollars eacli. ArpLETON, Nathaniel ... 1 Baroe, Jacob 1 Barclay, JoiiiNf 2 Bingham, W" 95 Bingham, Ann 5 Bingham, Mary .... Bridges, Bob't .... Brown, Mary Bell, Daniel Bradford, John .... Breck, Sam'l 2 Baker, John 3 Benezet, Philip 1 Bache, Richard 10 Beavan, W» 2 Brown, John Bartram, Ann .... Bell, W" Conyngham, D. Hayfield Clymer, George .... Carson, Joseph .... Caldwell, And''. & James Crawford, James . . . Craig, James, Jun'. . . . 18 2 5 1 7 1 4 1 1 98 4 8 1 9 Codman & Smith 1 Carter, John CoxE, Tench Cox, James Caldwell, Jane .... DuNLAP, John DONNALDSON, JoHN .... 3 Davidson, John 1 Denning, W" 5 Davis, Caleb 1 Decatur, Stephen .... 3 Dickinson, Philemon ... 13 Dyer, Sarah 1 Delaplaine, Sam* 1 Eddy, George 1 Emlen, George 2 FiTZSiMONs, Thos 2 Fuller, Ben.t 10 Fromberger, John .... 1 Franklin, John 12 Francis, Tench 4 Fox, Jos. M 1 Gurney, Francis 1 Haynes, Geo 2 Hill, Henry 5 HoLKER, John 5 17 134 A HISTORY OF HiLLEGAs, Michael Hatch, Crowell . Hockley, W". B. . Hazlehurst, Isaac Hewes, Josiah Hare, IIob't . . Hopkinson, Francis Inglis, Samuel, & Co Irvin, Thos. . . Jones, John Paul Jarvis & Russell KiDD, John . . . Low, Nicholas Lardner, John Langdon, John Luzerne, Chevalier De La LiEPER, Thomas . Lowell, John . . Lewis, Mordecai . Mease, John . . Morris, Robert . Meade, George . Mitchell, John . BIitchell, Henry McClenachan, Blair Morris, Cadwalader Meredith, Sam'l . Mease & Caldwell Morris, Gouverneur Moses, Isaac . . Moore, Philip . . Morris, Hannah . Milligan, Ja'. . . Marbois, Barbe de McMurtrie, W". . Morris, W". . . Matlaok, Timothy Nesbitt, John M. Nixon, John . . 1 5 4 1 25 5 4 1 1 5 1 2 1 5 1 98 3 2 2 11 1 7 2 1 1 1 1 3 1 12 1 1 1 Nichols, Francis 1 Nathan, Simon 1 Osgood, Sam'l 1 OzEAS, Peter 1 Otis, Samuel 2 Pettit, Charles 1 Penrose, Thos 4 Paca, W™ 2 Peters, Rich'' 2 Parker, Daniel 1 Parsons, Theophilus ... 1 Powel, Sam'l 23 Poelnitz, Baron 12 Price, Edw* 1 Pringle, John 3 Ross, John 5 Russell, Thos 5 Robertson, Alex'' 10 Rush, Benj 1 Read, Jas 7 Shiel, Hugh 1 Semple, W" 1 Swan wick, John 71 Smith, Charles 3 Salomon, Haym 2 Shoemaker, Thomas ... 2 Shippen, Edw''' 10 Stuart, Jas 1 Smith, W™ 50 Simpson, George 1 Strettell, Frances .... 1 Stamper, John 4 Stewart and Totten ... 1 SwYLER, Jacob L 1 TiLGiiMAN, Tench 1 Tilghman, Jas 13 TURNBULL, W" 2 TiMMONs, Dean 2 Tracy, Nath' 5 THE BANK OF NORTH AMERICA. 135 TOTTEN, Rob't 1 Vanbibber, Ab. & Jn°. ... 2 Vaughan, John 4 Wii.cocKS, John 2 Wilson, James 5 Wilcox, BIark 1 Willing, Thomas 11 Willing, Chahles .... G Willing, Abby 2 White, W" 1 Wendal, Oliver 1 Wetmore, W" 1 Wadsworth, Jeremiah WiNEY, Jacob . . . . Whiteside, Peter . . Wilson, John . . . . WiCKERSHAM, AmOS . . 104 1000 Of tlie aljove shares, the United States at first paid for 633, and the Bank, by special bargain, lent them tlie whole Money immediatel}^, l)ut, it not being convenient for the Financier to repay the money wlien wanted by the Bank, He reconveyed the said Sliares, and they were bought up by some of the foregoing Suljscribers. N.B. — The first Subscription was thus completed on the 25th of July, 1783. Thos. Willixg, President. 136 A HISTORY OF V. SECOND SUBSCRIPTION TO THE NATIONAL BANK, 1784. At a general election, held at the bank January 12, 1784, a proposal was laid before the stockholders for ojiening a new subscription to enlarge the capital stock of the bank, upon which it was unanimously resolved That a subscription shall be opened at the bank on the first day of February next, and continue until one thousand additional shares shall be subscribed. That the price of each new share shall be five hundred dollars, and tlie amount of such shares shall be added to the 2:)resent capital of the bank, so a.s to form one common stock, which shall be the proj^erty of the several stockholders, in proportion to the innuber of their respective shares, and witliout regard to the sum paid for such shares at the time of the subscription, and that in every case the money sliall be paid at the time of subscribing. Wherefore, we, the subscribers, having read the above resolution for increasing the capital stock of the bank, ap- proving, confirming, and herel^y agreeing to the same, we sign our names, and opposite thereto affix the number of shares for which we subscriljc, having made and further agreeing to make payment according to the conditions above specified. At the above general election the stockholders assigned to THE BANK OF NORTH AMERICA. ]37 Thomas Willing, President Four shares. Jacob Barge One share. J. Swan WICK, on behalf of His Excellency P. J. Van Berckel Fifty shares. J. Swanwick Thirty shares. Willing, Morris, & Swan wick Seventy shares. De Heyder, Veydt & Co., by Haym Salomon . . Ten shares. Tench Francis, on behalf of John Kidd .... Three shares. Willing, Morris, & Swanwick Nineteen shares. Clement Biddle & Co Three shares. Thomas Lowrey' One share. Eleazer Oswald One share. Abeam Markoe Four shares. William Vaughan, by John Vatjghan One share. John Darby, by D Four shares. BEN.JAMIN Fuller Ten shares. Tench Francis, on behalf of William Bull, Esq. . One share. Richard Mason Two shares. Miller k Abercrombie One share. Spencer & Marache Two shares. Henry Pratt One share. John Ross, for Barb^ de Marbois, Esq Six shares. John Ross Ninety-four shares. James Hood Two shares. Nixon & Clarkson One share. Samuel Coates One sliare. Nathan Sellers One share. David Sellers One share. W. Barton & Co One .^^hare. Cadwalader Morris, for Hannah Morris . . . One share. Cadwalader Morris, for Hannah Morris . . . One share. Samuel Jackson One share. Nathan Falconer Two shares. Cornelius Barnes Two shares. William Nichols Two shares. Samuel Powel Twelve shares. Peter Lohra One share. George Meade l^i^e shares. Samuel Powel Two shares. 138 A HISTORY OF George Meade, for Frances and Anna Maria Clif- ton One share. George Meade, for Charlotte Prettejohn . . . One share. George Meade, for Henrietta Constantia Meade . Three shares. Joseph Harrison Two shares. Egbert Morris, by James Rees Six shares. Doctor John Baker One share. Isaac Vanbibber, by Thomas Willing .... One share. Eeed & FoRDE One share. William Constable, fur Samuel Fleming . . . Fifty shares. John Field Two shares. Thomas Penrose Two shares. William Ruibel Two shares. Lamb & Checkley Two shares. John Wilcocks Two shares. Andrew Doz, fur Abraham Wayne One share. John Brown & Sons One share. Conyngham, Nesbitt & Co., fjr D. H. Conyngham One share. Conyngham, Nesbitt & Co., fur J. M. Nesbitt . . One share. KuHN & Risberg Two shares. William Tilton Two shares. Mordecai Lewis & Co Two shares. Evan Evans, for Mary Evans One share. John Brown Twenty-two shares. Haym Salomon Two shares. William B. Hockley, fur the six niinur children of my deceased sister Tliree sliares. George Eddy Two shares. William Constable Four shares. John and Egbert Morton Two shares. George Bickham One share. Ben.iamin Mason One share. John Hood Four shares. John Donnaldson, fur I^dward Milnor .... Two shares. John Donnaldson, fur Mary Donnaldson . . . One share. John and William Montgomery Two shares. William B. Hockley Two shares. Israel Whelen One share. Ezra Jones One share. THE BANK OF NORTH AMERICA. 139 Thomas Saltab, Four shares. Leonard Jacoby One share. Charles Syng One share. John Barclay One share. Isaac and Samuel Lewis Wharton Six shares. John Sparhawk Four shares. George Latimer One share. Pelatiaii Webster Two shares. Elliston and John Perot Six shares. Abram Markoe Three shares. Abraji Wilt, Jr One share. Henry Hill Three shares. Thomas Willing, for the Chevalier De La Luzerne One share. Willing, iMorris, & Swanwick, for Miss Abby Willing Tliree shares. Jacob L. Swyler, for Jacob Winey Five sliares. Thomas Stritcii Two shares. James B. Nickolls Two shares. William Wister Two shares. Thomas Willing, for INL-s. Mary Bingham . . . Three shares. Andrew Ty'bout One share. Charles Cooper One share. 140 A HISTORY OF VI. SECOND SUBSCRIPTION TO THE NATIONAL BANK CONTINUED AND EXTENDED, 1784. Secjond subscription to tlie caj^jital stock of tlie national bank continued and extended this 1st day of March, 1784, at a general meeting of the stockholders, by whom it was unanimously agreed That the new subscription shall be extended to the number of four thousand shares, wliich shall be added to the capital stock of the bank, at four hundred dollars for each share, making in the whole five thousand shares, including both the old and new stock. That the ohl, or first stockholders, shall divide the profits of the bank to this day. That those who have purchased old stock since the last dividend at an advanced price, n])on assurance given that the 2)rice of the new stock would be held at five hundred dollars, shall have the sum given in advance repaid to them, together with interest at the rate of six per cent, per annum on tlie whole 25urchase-money from the day of the transfer, instead of the dividend. That those who have already subscribed for new stock at five hiuidred dollars each share shall be repaid an hundred dollars each share, together with interest at the rate of six per cent, per annum on tlieir whole sul^scription from the time of payment to this day, after which they shall receive dividends in common with all the subscribers, old and new. THE BANK OF NORTH AMERICA. 141 That all stock suLscriLed fVjr after this date shall draw a dividend from the day of sucli subscription respectively. Wherefore, we, the suhscrihers, having read the above resolutions, approving, confirming, and hereby agreeing to the same, we sign our names, and opposite thereto affix the number of shares fjr Avhich we sul)scrilje, having made pay- ment according to the above conditions. Thomas Willing (additional) One sliarc. Sampson Fleming (additional) Thirteen sliLircs. MoRDECAi Lewis, for Luke jNIorris Ten shares. JosiAH HE^YES Two shares. Samuel Powel (additional) Four shares. Samuel Powel (additional) One .share. Andrew Doz, for Abraham Wayne (additional) . One share. Charles White One share. JosiAil Coates One share. EOBERT Morris (additional) Two shares. KoBERT Morris, for Tench Tilghman & Co. . . Ten shares. Elliston & John Perot (additional) Two shares. John Sparhawk (additional) One share. Thomas Willing, for Abby Willing (additional; . One share. Thojias LoWREY (additional) One share. Moses Cohen Two shares. Jacob Large (additional) Three shares. Mordecai Lewis & Co. (additional) One share. Wager & Habacher (additional) Two shares. Philemon Dickinson Twelve .shares. Levi Hollingsworth T^to shares. W. Alexander & Comp'y Ten shares. Thomas Saltar (additional) Four shares. Jacob Downing 0»e share. Spencer & Marache (additional) One share. [saac and Samuel Lewis Wharton (additional) . Four shares. Cornelius Barnes (additional) One share. Joseph Pennell Three shares. William Constable Four share.s. 18 142 A HISTORY OF John Jones Twelve shares. James Sloan One share. Cornelius Barnes One sliare. John Hood (additional) One share. Peter Lohra (additional) One sliare. EiCHARD Mason (additional; One share. Eleazer Oswald One share. Thomas Franklin Two shares. Barbe de Marbois Two shares. William Nichols (additional) One share. Benjamin Gibbs Two shares. Caspar Guyer One share. Josijpn Bullock One share. Jehu Eldredge One share. Conrad Wister One share. BEN.IAMIN Davis, Jr One share. Benjamin Davis, Jr One share. Benjamin Fuller Three shares. John Brown Sis shares. Thomas Beaming, Jr., for Thomas Leajiing, of Cape May One share. Jacob Keehmle One share. Ben.jamin Fqller Seven shares. Matthias Keeley One share. KoBERT CoRREY One share. David Sellers One share. Nathan Sellers One share. John Vaughan (additional), J. Darby One share. Benjamin Davis, Jr., for Thomas West . . . Two shares. Casper Singer & Son One sliare. William B. Hockley, fur tlie six minor children of my deceased sister One share. TowNSEND and John White One share. William B. Hockley One share. Fred'k Heisz & Co Two shares. Luke Keating ■ Two shares. Cornelius Barnes Two shares. James Cox Two shares. William Sykes Ten shares. THE BANK OF NORTH AMERICA. 143 Haym Salomon, for Joshua IMaddox Wallace, by order of William Bradford, Esq. . . Four shares. John and James Oldden Two shares. Josiaii W. and William Gibbs, five of these re- turned cancelled June 4 Five shares. Samuel Jackson Two shares. Jacob Downing One share. John Ming & Co One share. Peter Bedford One share. William and John Sitgreaves Six shares. Samuel Gerrisii, for J. Langdon, E.sq Five shares. Samuel Gerrisii, for Joshua Bracket, Esq. . . One share. James Stuart One share. IsUMAEL Owens One share. George Logan Three shares. Peter Knight Four shares. John Swanwick, on behalf of His Excellency P. J. Van Berckel Thirteen shares. John Swanwick Eight shares. Spencer & Marache Three shares. Joseph Swift Five shares. William and John Sproat One share. Peter Thomson One share. Conrad Gerhard Two shares. Peter W. Gallaudet Two shares. Caspar W. Haines Two shares. Ben,jamin W. Morris, for Sarah Wistar . . . Three shares. Edward Burd T'lree shares. COXE & Frazier 'J^^^o shares. George Fox Fourteen shares. Leonard Dorsey T"'o sliares. John Steinmetz Twenty shares. Solomon Lyons One share. Reed & Forde Three shares. William McMurtrie Twenty shares. Joseph Harrison, for the Kev. Dr. White . . . One share. George Latimer, for James Booth, Esq. . . ■ One share. John Hood I'j^'e .shares. Adam Zantzinger ^^"''^ shares. 144 A HISTORY OF Robert Bridges Two shares. Richard Adams One share. Ben.jamin G. Eyre One share. James Craig Five shares. John ami James Oldden Two sliares. James C. Fisher Two shares. Samuel Howell Twenty-seven shares. William Jones One share. William Ball Two shares. George Fox One share. John Steinmetz Ten .shares. Joseph Cauffman Two shares. William Rdibel Three shares. William Constable, for William Edgar . . . Fifty-five shares. Vardon, Giese & Co Five shares. Jacob Barge, for Elizabeth Gross One share. Tench Francis, for Robert Erwin Two shares. Henry Voorhees One share. John Kidd One share. J. SwANWiCK, on behalf of Tench Tilghman & Co. Ten shares. Edward Duffield One share. Thomas Fitzsimons, for Anna Maria Clifton . One sliare. Nathaniel Falconer, for General Mifflin . . Eleven shares. Nathaniel Falconer, for Rebecca Morris . . One share. Pragers, Lieeaert & Co Ten .shares. Thomas Penrose, for Thomas Penrose, Jr. . . One share. Archibald Gamble, for Jane Cannon .... One share. Henry Hill, for James Jacks, Esq., of Lancaster . One share. Benjamin Fuller Five shares. DoNNALDSON & CoxE Twenty shares. Ann Powell, by John Wilson One share. Tench Francis, for the Honorable Arthur Lee . Fourteen shares. John Jones, for Thomas Jones Seven shares. Nathaniel Falconer, for Mary Bickley . . . Three shares. Collins & Truxtun Two shares. AbRAM Markoe Four shares. Israel Morris, Jr., for Luke Morris Four shares. John Angus Four shares. Benjamin Fuller Four shares. THE BANK OF NORTH AMERICA. 145 James Hunter One share. David Kennedy One share. John F. Mifflin One share. John Nixon, •) Executors to estate of M. Rogers, J. M. Nesbitt, j" late of this city, deceased . . . Three shares. Magnus Miller Throe shares. Frederick Greiner One share. Tench Francis, for Honorable Arthur Lee . . . One share. Michael Hillegas, for Captain Edward North . Two shares. Jacob Laverswyler, for Catharine Laverswyler One share. Tho.mas Parke, for Hannah Lloyd Two shares. Tench Francis, for the Honorable Arthur Lee . Two .shares. Peter Whiteside, for Wallace, Johnson & Muir. Two .shares. William Bell Fifteen shares. John Brown & Sons, fur Alexander Porter . Twelve .shares. John Brown & Sons, for Alexander Porter . One share. John Wharton, as one of the executors of the Hon- orable Thomas AVharton, Esq., deceased, on behalf of the four minor children of his de- ceased brother by his first wife, Susannah, viz. : Lloyd, Kearney, Moore, and Sarah Whar- ton Five .shares. George Schaffner Five shares. Nathaniel Falconer, for General Thomas JIifflin Two shares. Edward Burd Two shares. Tench Francis, for the Honorable Arthur Lee . One share. Benjamin Chew Three shares. Michael Siiubart, for the German Society . . Three shares. Jacob Laverwsyler, for Jacob Winey .... Four shares. Benjamin Fuller, as one of the executors of William West, deceased, on behalf of the five minor chil- dren of said William West, viz. : William Hodge, James, Benjamin Fuller, Annie, and Helen West, three shares each, making . Fifteen shares. Eichard Footman, for the estate of Peter Car- MICK, deceased One share. Benjamin Fuller, for David Hayfield Conyng- liAM One share. Catharine Lardner, by William Lardner . . One share. 146 A HISTORY OF John Oldden, for Samuel Oldden One share. T. F., for Samson Fleming, by order of Thomas FiTZSiMONS Two shares. Arthur Lee One share. Matthias Harrison, fur Thomas Mifflin, Esq. . One share. Isaac Warner Six shares. Thomas Harrison Two shares. Thomas Harrison One share. Constable, Rucker & Co., by Garrett Cottringer Twenty shares. G. Fowler Five shares. Caspar Guyer Two shares. Mary Tucker, by William Smith Four shares. William Foot, by William Smith, for the use of two minor daughters of the deceased Mr. Thomas A. BuRCH Four shares. Thomas, Samuel, and Miers Fisher Ten sliares. Thomas Harrison One share. Alexander Stuart Eight shares. William B. Hockley Two shares. William Ruibel One share. John Kidd Two shares. Benjamin Fuller, for BIargaret Stocker . . Eight shares. BEN.TAMIN Fuller, for Margaret Stocker, Jr. . Eight shares. William B. Hockley One share. Nathan Sellers One share. David Sellers One share. Richard Bache, for William Temple Franklin, Esq Eleven shares- J. SwANWiCK, on behalf of Mr. Arnoud David Van Lennep Ten shares. Samuel Smith Twelve shares. John Gray, for Sarah Fitzsimons (widow) . . One share. John Kidd, for Mary Foulke Two shares. John Lukens Four shares. John Jay One share. OusRAY Painniere Two shares. Jeremiah Warder, Parker & Co Four shares. Garrett Cottringer, on behalf of George C. Anthon Six shares. THE BANK OF NORTH AMERICA. 147 John Ross, for IMrs. Dorcas Montgomery James Eead, for George Head .... Thomas Fitzsimons, for Matthias Ooster TiiOMA.s FiTzsiMONS, for Hendrick Hovy Curtis Clay, for Mrs. Ann Clay . . . J. SwANWicK, for G. K. Van Hogdenderp Mordecai Lewis, for Jan Deknatel . . MoRDECAi Lewis, for Herman Angelkot One share. Two shares. Twenty-five shares Twenty shares. One share. Ten shares. Three shares. Two shares. 14S A HISTORY OF VII. CORRESPONDENCE WITH THE COMPTROLLER OF THE CURRENCY AS TO THE RETENTION BY THE BANK OF THE NAME OF THE " BANK OF NORTH AMERICA" ON BECOMING A NATIONAL BANK. Thomas Smith, Esq., President, to Hon. Hugh ]\IcCul- loch, Comptroller : PniLAnELPniA, October 28, lS6i. Proposing that the Bank of North America should become a national bank, and suggesting that it should retain the title of the " Bank of North America," without the usual prefix of " National." Hon. Hugh McCulloch, Comptroller, to Thomas Smith, Es(p, President : Washingto.n', October 29, 1864. Dear Sir, — Your favor of the 28th inst. is received. Such has been the history and such the relations of the Bank of North America to the General Government, that it seems to be eminently proper that in its reorganization and rejuvenation under the National Currency Act, it should assume as its title " The National Bank of North America." Every State bank hitherto changed into a nationid association has taken, in connection with its former name, the word " National," and I should regret it if the oldest and most loyal of all of them should be unwilling to indicate hy ils title its relations to the national banking system of the National Government. In order to make the change, you must obtain the consent of the owners of two-thirds of the capital stock of your bank, and, if you advise it, I do not believe that a single one of them will hesitate to assent to the introduction of the word " National" into the title. Please let me hear from j'ou on this point. I do not now say that I shall decline sanctioning the reorganization of your bank under its present title alone. If I do it, it will be against my own judg- ment and with extreme reluctance. THE BANK OF NORTH AMERICA. 149 There was, I think, well-founded objection to the "numeral system" of Mr. Chase, but of the 5G1 banks organized under the national system not one has objected to the word " National" as a part of its title, and I do not believe that, upon reflection, you will. Some parts of your letter please me so much that I would publish them if I felt at liberty to do so. I forward you a half dozen sets of Forms, etc. Very truly yours, H. McCuLLOCH, Comptroller. Thomas Smith, Esq., President Bank of North America, Philadelphia. Thomas Smith, Esq., President, to Hugh McCulloch, Esq., Comptroller : Philadelphia, November 1, 1864. Hon. Hugh McCulloch, Comptroller of the Currency. Dear Sik, — Your valued favor of the 29th is at hand. Wishing to avoid the use of your valuable time in a matter of so little moment as the addition of the word '• National" in the name of this bank, I am compelled to do so because there is so much feeling about any change of name with the stock- holders and directors, arising principally from the fact that its present is its old national name given to it by Congress in 1781, retained by it, after much violent opposition, in confirmatory charters had from Delaware, Massachusetts, and Pennsylvania, the same political heresy of State rights being then, as now, rampant. There is no similarity between this and any other bank, cither State or National. First. We hold the national charter, December 31, 1781, which has never been abandoned or relinquished, but, in consequence of the partisan opposition to the bank, this charter was confirmed by the three States in which its busi- ness was chiefly done. No new charter was given or made. It was simply confirmatory of the charter made by the United States, which confirmatory charters by this State have been renewed (being limited in duration) as they expired. The original charter is perpetual. The great merit of the corporation and pride has alwa3rs been its national character. We have it in brass in the building and printed on the notes. In July, 18G2, we passed, and published in the papers, a resolution, a copy of which I inclose. We loaned all we had to the Government when they wanted it, and the timid said it was imprudent to do so, and we have and hold two and 19 150 A HISTORY OF a half times the amount of the capital in United States securities noTV, and in- tend to do so. The national banks are generally organized to benefit the stock- holders, and for that purpose only. This bank was created avowedly to aid the United States. It fulfilled its mission, and then went on prosperously, filled with the pride of that mission. These arc some of the reasons for asking permission to retain our national name of " The Bank of North America." The matter has been thoroughly canvassed by the directors, and I will frankly state that I heartily agree with them in pressing the request. With a personal interview, and the documents in our possession, I feel you would say we were right. At the same time we shall do nothing, however small, to detract from the strength of the nation in this her struggle for existence. And we believe the national bank system to be one very great element of success and strength. Should you determine that we cannot change without an alteration of name, please inform me in rela- tion to it, our arrangements all being made for the old name. In the mean time, I inclose you specimens of the issue of the notes of the bank, if you are at all curious in such matters, the issues of the Pievolution, the war with Great Britain, and the Rebellion. They are genuine, and good for redemption at any time. Awaiting your leisure to hear from you, I am, Respectfully, your obedient servant, Thomas Smith, President. Tlie same to the same : Philadelphia, November 11, 1864. H. McCuLLOCii, Esq., Comptroller of the Currency. Dear Sir, — Your favor of the 4th was duly received. I should have felt much relieved by something to warrant the belief that you would sanction the old name. The meeting of stockholders is on Monday next, and it is by no means certain that the requisite number of two-thirds can be obtained at all. The election has demonstrated that Uncle Sam can take care of himself now, and there is, therefore, no necessity for any little moral support, besides there are several Banks of North America, and after a time there may be the same number of N(xtwiial Banks of North America. I can, if you desire, send you a commendation from the other banks for our old name. The notes I sent you arc to be retained ; we have other specimens of the same kind. Respectfully, your obedient servant, Thomas Smith, President. THE BANK OF NORTH AMERICA. 151 The same to the same : Philadelphia, November Ifi, lS6i. Hon. H. McCuLLOCH, Comptroller, etc. Dear Sir, — The stockholders of this bank have voted authority to its directors to change from State to National. Our desire is to retain its present name in the organization certificate, — " The Bank of North America." Will you be pleased to inform me if this will meet your approval in order to avoid the trouble and vexation attending a failure ? Referring to my previous letters on this matter, and awaiting your reply, I am j'our obedient servant, Thomas Smith, President. We are progressing slowly with obtaining the consent of two-thirds of the stockholders. Ill cousequeiiee of the foregoing eorrespondeiice, and at the request of the presidents of most of the Phihidelphia hanks, the Comptroller of the Curreney at length eonseiited to allow " The Bank of North America" to retain its original title, without the jjrefix " National," on hecoming a national hank. — Bee ante, page 118. 152 A HISTORY OF viir. DIVIDENDS PAID BY THE BANK OF NORTH AMERICA FROM 1782 TO THE PRESENT TIME, 1782 SJ per cent. 1783 1-4} " 1784 13J " 1785 G 1786 G 1787 G 1788 GJ '• 1789 7 1790 7 1791 13} " 1792 12} " 1793 12 1794 12 1795 12 179G 12 1797 12 1798 12 1799 11 1800 10 1801 10 1802 10 1803 9 1804 9 1805 9 180G 9 1807 9 1808 9 1809 9 per cent. 1810 9} " 1811 9 1812 9 " 1813 10 1814 10 1815 10 " 1816 10 1817 10 1818 10 1819 9 1820 6} " 1821 6 1822 G 1823 G 1824 6 1825 6 " 1S2G 6 1827 4 1828 5 1829 5 1830 5 1831 5 1832 5 1833 6 1834 6 1835 7 THE BANK OF NORTH AMERICA. 153 1836 1837 1838 1839 1840 1841 1842 1843 1844 1845 1846 1847 1848 1849 1850 1851 1852 1853 1854 1855 1856 1857 1858 per cent. One cent. 6 per cent. 8 8 10 15 12 15 15 15 15 15 15 15 11 10 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873 1874 1875 1876 1877 1878 1879 1880 12 9 6 10 12 12 31 per cent. 30 22 J 20 20 20 20 20 20 20 20 16 16 16 16 The amount to credit of surplus and profit and loss, Januar}' 1, 1860, was 8288,361.81 There was to credit of the same accounts on January 1, 1881 1,100,000.00 Showing a gain of §811,638.19 During the same period there have been paid to the stock- holders dividends amounting to 3,700,000.00 Showing total profits, being over 451 per cent. 84,511,638.19