The Sun.
London, England, 1861-03-19 00:00:00

THE SU*, LONDbN, TUESDAY EVENING, MARCH 19, 1861.

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COMMERCIAL BANK OF LOYDON.

SPECIAL GENERAL MEETING (TITS DAY.)
A special general meeting was held this dsy at the Com-
mercial Bank of London, Lothbury, for thepurpoae of re-
ceiving'a report from the board of directors d an agreement
entered into by the board with the London 51d Westminster
Bank for an advance by the London and Westminster to
this bank, and for the transfer of the businem of the Com-
mercial to the,Westminster.
MARE HUNTER, Esq., occupied the &air.

After reading the advertisement,
The CHAIRMAN said they were aware of be disaster that
had called them together, and without detailing them with
any preliminary statement he would proceed to read the re-
port of the directors. The document stabd that late one
Friday night information was given to the directors that
the bank had been robbed to the extent o' £87,000 by a
ledger keeper named Durdin, and a meetinvf the directors
was summoned the following morning, and at the
meeting it was decided to obtain assistance at the
earliest moment. The London and Westmnster being the
largest establishment, the directors were tpplied to, and
they agreed to advance a sum of money not exceeding
£1,000,000, provided the directors transferred the whole of
their business to that establishment. The directors, before
adopting this course, fully considered ther position, and
found there were three courses open to them either to close
the doors of the bank, which would create a 'Artie in the com-
mercial world, to stand a run which was ineviable, or to make
some such arrangement as the directors Ind adopted. If,
as he said before, the doors had been chsed, the share-
holders would have been involved in great expense. The
bank was in a position to stand a run, but with money at
8 per cent. the cost would have been enormous, and the
result would have been, after fighting tint battle, that
little worth possessing would be left at the
conclusion of the contest. The assistance of the
London and Westminster was preferred, aid an arrange-
ment was made with that bank for a transfer of the
business, and the reason the arrangement was so speedily
concluded was, that the London and Westuinsterpositively
refused to enter into any arrangement afttr a rnn on the
Commercial Bank had once commenced. The directors
thought that tho course they had adopted was the wisest,
and they confidently anticipated that the whole of the
shareholders' capital would be returned to them in full.
(Hear, hear.)
The agreement between the Westminster and Commer-
cial Banks was then read, and it was to the effect that the
assistance asked should be rendered in the event of the
transfer of the business of the bank to the Westminster.

The report of Mr. Jay of the firm of Quilter and Ball, of
the accounts of the bank, in which it was stated that the
actual sum of which the bank had been defrauded by Dur-
din was £66,992 7s. 2'd., was read.

Mr. CUTBILL, the manager, then read a statement of the
affairs of the bank on the evening preceding the discovery
of the robbery. After noticing the paid-up capital of the
bank and other items, it went on to show that in four
weeks the bank had paid off £600,000 of its liability from

its own resources. They held securities to the extent of
£777,690 to meet outstanding liabilities of £170,000. (Hear,
hear.) He said he had felt eertain that i n two months from
the present time the Commercial Bank, as a bank, would
be entirely out of debt to the whole of the shareholders.

The CHAIRMAN then moved a resolution confirming the
agreement entered into by the directors with the directors
of the London and Westminster, which having been
seconded,
Mr. FISHER said he thought the directors had taken a
course which he thought the proprietors would think was
wise and judicious, because thereby they had all been saved
great anxiety and trouble, and he should not wonder the
least at the London and Westminster coming forward to pay
their usual half .yearly dividend (laughter.) He did not see
there was anything so out of the way in such a proceeding.
The Westminster had made a very profitable bargain, and
if they paid the £12,000 which the dividend amounted to,
they would make a profit then by their business of over
£40,000. (Hear, hear.) So the meeting would see that it
was not such an unwise act for the London and West-
minster after all. If the directors had had time to arrange
the transfer of their business, ho felt sure the 'Westminster
would have been only too happy to give considerably more
than £12,000 for such a good and ready-made business.
But the directors had to decide in a few hours, and he could
not resume his seat without again saying, that the directors
had done the best thing they could for the shareholders
under the circumstances of the case.

The resolution was then put to the meeting and carried
unanimously.
After a short discussion, another resolution, appointing
several of the shareholders to act with the directors in
finally arranging the affairs of the bank was negatived,
and the meeting adjourned.

The following is the report of the directors :
" Information having been received at a late hour on the
evening of Friday, 15th February, that the bank had been
robbed by a ledger-keeper at Henrietta-street (named
Durdin), to the amount of £67,000, steps were at owe
taken to summon all the directors in or Rear London for
the following morning.
"At this meeting, after consultation with the solicitor
and manager of the bank, it was determined that, as the
first duty of the directors was to protect their customers
against the run which was inevitable, it was desirable to
seek assistance in some shape from one of the joint stock
banks. The London and Westminster being the largest
bank, negotiations were at once opened with that estAbli.h
ment, and they engaged to advance any sum, not exceed-
ing a million, which might be required to meet your
lia-
bilities ; you directors undertaking, as far as lay in their
power, to influence their customers to transfer their
accounts to the London and Westminster Bank. The
details of this arrangement, which you are now asked to
confirm, will be read at the conclusion of this report.
"The arrangement was confirmed by a board especially
summoned for the purpose at eight o'clock in the morning,
on Monday the 18th ult.
" In adopting the course they did, the directors were in-
fluenced by the following considerations :
"Three courses were open to them :—To close the doors
of the bank—to stand a run which was certain—or to make
some such arrangement as is now submitted to you.
"To close the bank's doors would have been an unneces-
sary and unjustifiable cruelty to its customers, and would
have exposed the commercial world to a panic, the
extent of which, at the present moment, it is impossible
to measure. To the shareholders, the result would have
been a winding-up under bankruptcy, with its attendant
vexation and expense. This course, therefore, was dis-
carded at once.

" The bank was in a position to risk the second course,
and stand any run, which could be reasonably anticipated ;
but with money at 8 per cent. as the minimum rate, and an
inevitable sacrifice on securities not instantly convertible,
the price of fighting the battle must have most seriously
affected the property of the shareholders.
" The directors believed, looking to the result of the run
on them in 1866, when the deposits were reduced from
£1,500,000 to £BOO,OOO, a reduction from which they had
not, up to the present time, recovered to any appreciable
extent, that a second run would leave them at its termina-
tion no business worth preserving. The winding-up of the
bank must have followed, and that would, practically, have
placed you in the same position in which you now stand;
but with this material difference, that you would then have
paid a heavy price for that which now costs you nothing.
" It may be said that the bank, forced, for these reasons,
into an arrangement of some kind, might have made a better
one. Your directors think otherwise. With a week—with
forty-eight hours before them—they might possibly have
done it; but Monday would have found the bank with a
run upon it ; and the London and Westminister positively
refused to deal with us in any shape after a run had once
commenced.

" There can be little doubt that other banks, influenced
by the same considerations, would have followed this course.
Be that as it may, the want of time, the necessity for secresy,
so long as secresy was possible, prevented negotiations with
other establishments.

"The present arrangement, by which the great majority
of your customers have transferred their accounts to the
London and Westminster Bank, may be looked on as the
price paid to that company for having saved you from the
anxiety and loss of a run.

" Doubtless it is a most painful price to pay ; it was not
agreed to until other proposals had been made and rejected;
but if your directors are right in their belief that remune-
rative business was at an end, this price becomes nothing,
as your accounts would have left you of themselves, as
they did in 1856. The profits, if any, of the small business
which might have been left to you (looking at the necessity
of re-creating a reserve fund), would have afforded little or
no dividend for a series of years, during which your shares
must have remained at a nominal price.
"As it intended to ask you to appoint some of your own
body to advise and co-operate with the directors, in the pre-
sent position of the bank's affairs, it has not been thought
necessary, nor was it possible within the time, to give you
more than an approximate statement of the liabilities and
assets on the evening of last Saturday, the 16th inst. The
figures, however, are given, which show the state of the
accounts on the day of the transfer of the business and at
the present time.
" Whilst, on the one hand, the directors would regret to
state anything calculated to create an unfavourable impres-
sion of the value of the shareholders' property, they must
(having regard to the notorious uncertainty attending the
realisation of assets under the circumstances the bank is
now placed), guard themselves against making any state-
ment that may create expectations which the result may not
realise :—they confine themselves to the expression of their
hope that the shareholders' capital will be returned to them
in full."

THE STRIDES OF TRADE.—Capital appears to be
the social ogre of the present age, and devours the smaller
strugglers in the arena of commerce as remorselessly as the
giants of old swallowed up the little boys. The leviathan
London firms, ever ceaseless in their growth, absorb their
lesser brethren, who seem to have little choice beyond
closing their shutters and betaking themselves to other
pursuits. To illustrate this fact, we have but to instance
such general houses as Marshall and Snellgrove's, dealers
in everything from furniture to finery, who are gradually
swallowing up an enormous block of tenements, and pos-
sess some 80 men in the rifles; Shoolbred's, which firm
likewise boasts a corps of volunteers and its armoury;
Howell and James', their new jewellery saloon being equal
to anything of the kind in Europe. Tarn's, Harvey's, of
Knightsbridge, and some others.
is
yet more extraordi-
nary is the example of Jay's, as it s exclusively devoted to
mourning. This latter firm, which one would have thought
large enough for its requirements, claiming, as it did, the
entire space of the houses Nos. 247 and 249, Regent-street,
is again throwing out its aggiossive acquisitiveness, and
adding the whole of the upper portions of the adjoining
boot and shoemaker's, and the hatter's, alone ceasing after
extending itself over Merchant's, the wax chandlers, in
the very centre of the Oxford-circus. Besides this horizon-
tal amplitude, a crystal structure towers skyward over the
original buildings, and is used for the lighter description
of weak. While, moreover, a large manufactory in the
rear of Verey's Restaurant, in Princes-street, is an append-
age to this black establishment. Nor does the monopoly
of space end here; an extensive range of buildings in Mar-
garet•street is necessary for the making of the cloaks. The
only way to account for such successes is that these houses
must by fair and honest dealing, after a series of years,
have gained for themselves an accumulative custom which
time serves but to enhance; and this necessitates the ab-
solute requirement of a greater number of employes, in-
creased accommodation for their customers, and conse-
quently more room.