The Sun.
London, England, 1839-02-02 00:00:00

THE fAJN, LONDON, SATURDAY, FEBRUARY 2, 1839.

MONEY AND CITY NEWS.

(FROM TEE MORNING PAPERS OP Till DST.)
A meeting of the shareholders of the Manchester and Liverpool Dis-
trict Bank took place on Wednesday at Magchester, which was attended
by about 400 shareholders from different parts of the country. The
business of the day was the election of Directors, and the reception of a
report from a Committee appointed to investigate the circumstances
connected with the late immense losses of the Bank by the two Insolvent
firms of Brown and Powell, and Taylor, Gibson, and Co. The meeting
Excited the greatest interest among those concerned as proprietors, as
might naturally be expected on an occasion where such a mass
of property was at stake, and such an enormous sum sacrificed in
bad debts with two houses only. In the course of some sensible
preliminary remarks, the Chairman acknowledged that they had
"sustained A ►oss of 375,0001. That was a tremendous loss, such a loss
as was never experienced by any bank before, and he was only war.
prised that the confidence of the public and the shareholders had been
manifested under such circumstances." The bank, however, was safe
with an investment of 1,100,0001. "of its money." Mr. Gisborne, late
M.P., in the course of some animadversions on the management, in
respect of the losses incurred, went se far as to assert that " there was
more property pledged to the security of every man to whom that bank
owed a pound than there was in any other bank in the world." It ap.
peared from the Report of the Committee, which was read, that the ac-
count of Taylor, Son, and Gibson, with the bank, was opened in
1830, and not reported upon to the Directors until April,
1832. The present general Manager of the Bank was not then
attached to the head office, but immediately upon his appoint.
meat he reported to the Board the "then state of this account, among
others which appeared irregular." He afterwards again called attention
to the "serious liability" incurred with regard to bills passed in to the
account, which appeared of a very questionable character, and on inquiry
turned out to be "accommodation paper of little or no value." It is
stated, as an act of justice to the Board, that up to that time they were
" utterly ignorant of any risk is this account," but it is difficult to con-
ceive how this can seriously be set up as a justification, excepting so far
as to exonerate the Board from any suspicion of direct connivance at the
overdrawing or discounting the trashy paper described on account utthe
firm, which, collectively or individually, they could have no motive
for, unless some one or more among them had in their indi-
♦idual capacities trading and credit accounts with, and therefore
an interest in, the support of the insolvent firm, with which they might
be involved, at least until their own credits were cleared off. The blame
feisty imputable to the Directors arises out of the very ignorance adduced
is their behalf, for of course it is expected that nothing shall pass in the
Bank which does not come under their own immediate notice and con-
troul, and more especially in cases of heavy risk, It would appear from
certain statements made to the meeting, that various of the Directors
were so little in the habit of attention to their duties, that when appealed
to out of doors for information respecting the progress or proceedings of

the Bank, they were obliged to confess their ignorance. On the examine.
tion into Taylor, Gibson, and Co's affairs, which followed, it appeared to
the Committee appointed to that duty that the risk of loss might be dimi-
nished, if not entirely prevented, by extending further support to the
concern ; but in thus seeking to avoid a first loss by further advances,
the bank got still more deeply involved by vrrious unfortunate casualties
not calculated upon, as they should have been, in the course of trading
operations; for a destructive fire rendered greater accommodation still
necessary, the insurance of the premises, through the negligence of a
servant of the house, not having been renewed by the due payment of the
premium. The house, moreover, was saddled with all the debts
of a bankrupt concern in which incautiously the liabilities of a
partnership had been incurred ; and, to crown all, came the American
panic, "affecting to a dreadful extent the solvency of the connection of this
firm, and at the same time depreciating the value of a large stock" of
goods on hand suited for those markets. In the course of these
transactions, and since their conclusion, the conduct of Messrs.
Taylor and Co. is spoken of in terms of commendation, as having
shown " every disposition" to further the objects of the bank in the
liquidation of the concern. Messrs. Brown and Powell are not
so favourably mentioned, as it is stated in the report, that in pur-
suance of their objects the Committee of the bank had met from them
" with every opposition," and that they " had uniformly represented
themselves as possessing property beyond all their engagements." This,
however, it must be borne in mind, is the representation of the par-
ties on one side only.
But for the losses thus sustained, It appears there was a profit on the
banking operations of upwards of 86,0001., of which above 45,0001.
had been paid out in a dividend at the rate of 31 per cent. for the half.
year ending with June last, leaving undivided something more than
40,0001. It was explained in vindication of the further dividend
now declared, when fully known, that more than the whole of the
reserved fund had been absorbed by the losses referred to, that
many of the shareholders in straitened circumstances had no
other means of support to look forward to than the expected
dividends on their shares, and the case of one poor widow
with 25 shares, was mentioned who had no other means to
have recourse to. It may be doubted whether the declaration of a
dividend, even under such circumstances of individual hardship or
suffering, was justifiable in the state of the bank's affairs.
Some severe strictures, and not more so than deserved, were made
upon the conduct of the Bank Directors in embarking in trading ope.
rations, as was the case when they took upon them to carry on the in-
solvent concerns alluded to at their own risk, and for the profit of the
bank. The Shareholders, of course, understood nothing of all this,
but conceived the bank-was carrying on the legitimate business of bank-
ing, for which alone it was constituted. To their surprise, as one of
them observed, they " now discovered that they were not only
bankers, but calico printers and woolataplers. They were not
only calico printers without their own knowledge, and losing their mo-
ney in the business, but a great deal averse—they were doing the busi-
ness so cheap as to injure every fair trader." This is a clear view of the
matter, and such a state of things as must often occur when bankers step
out of their own business. The first loss is generally found to be the
least burdensome in the end, and had the accounts and the concerns of
the two hooks been wound up when the serious nature of the amounts
and the risk was first only brought to the knowledge of the Directors,
the bank would have been saved more than two-thirds of the actual loss
now incurred. It is notorious that two or three years ago the credit of
one of the houses was at so low an ebb in the Market, that credit could
hardly be obtained for a bale of cotton, and this must has e
been about the time when the bank ha] determined to
make no further advances, and to call in those already
made, and for which purpose proceedings at law were said to have been
commenced, which were abandoned, when by an unfortunate arrange.
ment the Directors were induced to take all the responsibility of the
ins6lvent estate on themselves, and carry on a losing business. For the
other creditors of the house, and for the trading public, it was fortunate
that such an arrangement was carried into effect, as the bank cleared off
all debts, and fresh credits could not be opened. In this instance the
ready publicity of the stoppage of credit and the difficulties of embar-
rassed parties, rumours of which must always more or less quickly
transpire where banking business is managed by a Board of many Direc-
tors, had the effect of rescuing the trade creditors and general dealers
from loss, and transferring it, sole and undivided, to the account of
the bank.

CHRONICLE.--There still continues to be ♦ery little doing in the
English Stock Market. Consols have declined 6 per cent. upon yester.
day's quotations ; but the premium on Exchequer Bills has again ad-
vanced Is. Consols for Money and Account were 02i to it; Exche-
quer Bills, 65 to 68 prem.; Bank Stock, 2021 to 203 ; and India
Stock, 2541 to 255 i.

The appearance of the Peninsular Securities was on the whole much
firmer to-day, and Spanish Bonds rose about per cent. In the other
foreign funds nothing particular occurred. Spanish Active was last
marked at 201 to f ; Deferred, 8 J to 93-; Passive, sto 1 ; Portu-
guese Five per Cents., 351 to 36; ditto Three per Cents., 22} to % ;
Dutch Five per Cents., 102} to 3; ditto Two-and.a.llalf per Cents.,
543 to ; Belgian, 963 to 99 ; Brazilian, 791 to ; Danish, 76 to 1 ;
Mexican, 24 to 3; Colombian, 28 4to ; Chilian, 26 to 28; Russian,
114 to 3 ; and Peruvian, 17 to 18.
London and Birmingham Shares were 76 to 78 prem. ; ditto (new),
233 to 243 prera. ; Southampton, 431 to 443 per share ; Great Wes-
tern, 11 N, to l 2 % prem.; Leeds and Manchester, 19 to 21 prem.;
Manchester and Birmingham, par to 3 premium ; ditto Extension, 1
dis. to 1 premium ; Birmingham and Derby, 11 to 10 dis. ; North
Midland, par to 1 premium ; •lasgow and Greenock, % dis. to 1 pre-
mium; Portsmouth and Gosport Junction. par to 1 premium; and
Greenwich, 161 to 17 per share.
There is not much alteration in the rates of exchange this afternoon,
as compared with those of last Tuesday. The rate on Amsterdam,
short, was 12 0 % to 12 I ; ditto, three months, 12 3; Paris, short,
25 22 4 to 25 25 ; ditto, three month., 25 473 to 25 521 ; Rotter.
dam, 12 31 ; Antwerp, 12 1 to 12 11 ; Hamburg, 13 81 to 13 83 ;
Vienna, 10 I to 10 2; Trieste, 10 2 to 10 3; Leghorn, 30a; Frank-
fort, 150; Marseilles, 25 521 to 25 571 ; Genoa, 25 621 to 25 671 ;
Naples, 4014 ; Madrid, 37 % to 37 ; Cadiz, 371 to 371 ; and
Oporto, 54

11E1; A L D.--The conuneri ial Money Market scarcely requires into
observation, but there is no alteration in the rate of interest upon coal-
mercial discounts.

There has not been any particular alteration in the rate of the conti-
nental exchange,, and Money still continues more plentiful than bills.
On Paris the rates arc 251 41c. to 50c. ; on Amsterdam 13 3 ; on Rot-
t.rdain 13 3 a ;on Hamburg 13 a 9, and on Frankfort 149! a 150.

LAW INTELLIGENCE.

SECONDARIES' COURT, FMB. 1.