The Express.
London, England, 1864-12-20 00:00:00

PRINCNS9 3.

TH74 EVENING. BORN 76noorLroc. Mr. T. Murray.
111a.1 THE sit:HI:TS JM DINDON. Messrs. Vining. J. W. Ray,
D. l';,tur, 6. Wirmy, .1. H. I,..rrester. mud H. llellou ;
Mrs. H. HArst...a. Ulm* Earuett and Gwyn e.

LYCEUM.

Cale EVENTN,I, MY wiPiitiFf. Yr. Widdiconiti.—BUY
AL Meiirs. Ye, hter. Ryder. Fltrpstrick. Charks. Mclntyre.
Collett, Clifford c 31iss c. Leelerot. Mrs.
Wmaitaidey.—And :CURSEY CHICW.WEED. Mr. WiStLicvtub.

MGR WATER AT LONDON-RRTDOE.

Tsui Ifinning, 61t. M0...../Jtennon, fn. 4522.
74 4m. Aittriv.en,

.I.").ffboN, TUESDAY, DEr.EMCER 2J.

Tee examination of TERRY and Brat n, the
Manager and Secretary of the defunct Unity Bank,
is casting valuable light on the possibilities of
joint-stock enterprise in this, the commercial capital
of the world. It is seldom that a police report con-
veys so much useful instruction. The delinquen-
cies ascribed to the defendants hare ceased to bo
the centre of the interest of the case, the evidence
of tho Directors being so exceedingly remarkable
in i•.s disclosures. Every shareholder iu a ;oint-
StOiii company should read it teice—once for the
excitement of surprise, in which it exceeds many
a novel, und again for the purposes of reflection.
The history of the Unity Bank is, as it should
be, unique. Other banks may hare led a short
life and a merry one, failing at length through
the peculation of officers or the wilful dis-
hon.:sty of directors. But the history of the
Unity was widely different from theirs. Except
in its institution, there was nothing flighty or
specalative about it; on the contrary, it may be
said to have been well ballasted with that solid
mediocrity which is so much trusted by many in.
vesturs. The Direcbra were highly respectable—
too respectable, alas ! since it was the confidence
which their character, apart from their business
qualifications, inspired which betrayed so many
shareholders to ruin. The extraordinary feature
of the case is that, whereas the bank was a failure
from the first, was continually denounced as a
failure at its own meetings, and was avoided as a
failure by the general public, a certain class of
persons clung to it to the last, refusing to be
warned by the plainest facts. The inborn vices
of the bank began to disclose themselves from the
very commencement of its existence. Shortly
after it opened a number of shareholders ar-
proaclied the Directors with an urgent reluest that
the" Superintendent-Director,- by which title the
promoter of the bank had obtained an appointment
for life, might be got rid of, and it became neces-
sary to give him 3,0001. in cash, besides 6,0001.
which had been paid him for his precious inven-
tion, to induce him to g 3 away. This was in
15:,.;. In September of the same year Mr.
CH.CIE ft.., the Manager, informed the Directors
that sa great was the panic out of doors that the
money would ad run out, and that the bank must
be closed unless the Directors would step in to
maintain the shares at their " proper value." This
was done by Alderman Nlseur buying, in the
most public-spirited manner, a large number of
shares with his own money. In February, 1857,
by which time Mr. CHAIIDERS bad left the bank,
a committee of shareholders repert,d that of
the 150,000'. corotituting its capital, 90,000...
had been eitl.er I>st iu bad debts or sunk in
preliminary expenses or in bank premises, and
that only o,ooo'. remained, with which to carry
on the concern. One of the Directors, Mr. E% RE,
nir.de the sensible teeeestion that the bank should
be ,VOlllll up ; however, strongly op-
posed by .tiderman the G.,venior of the
iastitution, for the singui..r reason that "the bank
" wzs at that time sald:t (1 with large premises
"for 30 pars, and w.!41 all the expenses of
f t

the wcsterti branch.' Even at this distar.ce
of time he can believe that " it would have
heen rm act of great lolly to wind rp the bank
" at titat time.- At the laeetin4 hell roll the nth
of January, i r 7,5, the Alderman, who to,k the chair,
thought it expedient to advert to the leases that had
I: c-n sustained, which he did in these words--" Let
" me hero remark that there is, in my opinion,
" much to be s MI on behalf of Mr. CuPOtims, and
"the &her evn•lcmon who have left us. They
"were plaid in a position of considorablv difficulty.
"As hankers, we came into the City without
"the prestige of groat names, and we had to get
"accounts. You all know how dithcult it is to
"induce persons to leave th.ir old bankers, and
"you alio know that many persona who go to a
"now bank do so in order to get something there
" which they cannot obtain elsewhere." The Alder-
man explained in the witness-hex last Saturday
that by this language he meant that in order to
do busineis the bank was obliod to give credit to
those who did not deserve it. And it was for
being inducted into facilities for lending money to
petp:e whom nobody else would trust that the

Unity Directors had paid their promoter 9,0001. !I
At this same meeting the shareholders were
warned of their danger by a Mr. HIND,
whom Alderman MECHI puts aside with
the remark that "he was one who never
" had confidence." By the June meeting of the
same year the affairs of the bank had become so
much worse under Mr. TERRY'S management that
proposals were again made by various shareholders
for a winding up. "There were always," says
Alderman MECHI, "two or three shareholders
" anxious to wind up." The wonder is dui& there
were so many, the general practice of worldly-wise
investors being to speak up for the concern at the
meeting, and then quietly go away and "get out."
Mr. DAVIS, one of the shareholders, observed at
the June meeting that he could not see of what use
it was to go on month after mouth flinging good
money after bad, and was told by the Governor
that "a leading joint-stock bank had first lost its
" capital, and then raised new capital and gone
" on." The Unity successfully emulated the
earlier half of this example.

All this while the Chairman and Directors were
sedulously impressing two considerations upon the
perplexed shareholders one, that the Bank,
although beset, like all young concerns, with
temporary difficulties, was well managed ; the
other, that it was well directed. At,
the meeting in January, 1859, Alderman
Meese said—" Through the excellent management
" of Mr. TERRY, combined with the careful super-
" vision of the Directors, the bad debts of the past
" year, instead of 40,0001., are 1,0001. 1 really
" think great credit is due to our management in
" this matter. We have got an excellent manager ;
" we take care that all who are employed are not
" merely testimonial men, but persons who have
" been tried before." So at the meeting in July,
1800, Deputy BOWER said—" We believe that Mr.
" TERRY and our other officers are clever, good,
" and honest." And to show the shareholders
how complete was their security for a vigilant and
sound direction of their affairs they spared no
assurances. At the meeting in June, 1858,
Alderman Mecitt said—" Allow me to say that the
" Directors do not trust entirely either to the clerks
" or manager. Every Tuesday we examine every bill
" that is discounted, and the particulars of every
" loan that is proposed." So at the January meet-
ing of the former year, already mentioned, Alder-
man 111 E( 111 said—" We are now in smooth waters ;
" past experience has made us wise ; we have
" learned not to place too much confidence in any
" man. We have got an excellent manager, but
" we shall watch even our manager closely, and 1
" contend that in a concern of this kind no man
" should be entrusted with unlimited responsi-
" And thus they went on meeting after
meeting enouncing, like Lord M aI:E.-num-, the
wisest general principles, but getting further into the
slough, deceiving the shareholders only the more
fatally because they at first succeeded in deceiving
themselves. Let their strong tram juillizing 1194urances,
given while the mischief was doing, be compared with
the following extract from Alderman 31Eciri's evi-
dence on Saturday last :—" On the 9th of Fe-
" bruary, on my way to the meeting, I said to
" Mr. BCR. II 1 could not understand what had
"become of our money. I told him to make a
" list of the bad debts. He said, ' Here is the
6" book,' producing one. The first three names
" of STERNE, LoWENTH.U., and BUNIARD appeared
" by it to owe us a large sum, which we thought
" had been paid twelve months before. I expressed
" my indignation and surprise at those amounts
"of several thousands of pounds in all [Mr.
" LEu 1.; : 16,0001.] having been concealed from
" us. Mr. BERCH said he did not like to mention
" the matter to us, and I mentioned the matter to
" my brother directors at the meeting of the day."
Now that the money is gone,the Directors hold a
much more modest language. They say, " We had
"no means of ascertaining the value of past
" due bills except through the Manager and
" Secretary. Wo inquired of them as to
" which were good and which bad. When
" wo complimented Mr. TERRY we believed that
"he was making a profit." We need not pur-
sue the subject. Alderman DlEcui has given the
best proof of his sincerity and good faith by
sharing the fortunes of the bank from its com-
mencement to its close. But it is not irrelevant
to remark that his blind confidence in a concern
which was rotten almost before it was formed, in
managers who never made a profit, and in him-
self, destitute, as experience might have taught
him, of every qualification of a bank director,
has been most disastrous. Honesty is an invalu-
able quality in the director of a public company,
but in this case, divorced from practical ability,
even honesty has proved positively a snare to the
investing public.