Portland gazette and Maine advertiser. (Portland, Me.) 1805-1818, 1811-04-08
GcnlnIontnea.tD Of a9aaatbtlctts.
REPORT OF I'VE COMMITTEE Rel.
zTTVE iTO PENOBSCCT BANK.


REPORT OF T'YE COMMITTEE REL
ATTVE no PENOBSC0T BANK
THE committee of the Senate, apgoin-
ted to make statement OF facts respecting
he affairs of the PenobScot Bank, have at
tended that service, and beg leave respect
fully, TO make the following Report.
The charter Ct the P@nobscot Dank was
Gran,ed March IL, 1906 On the 10Th Of
June following, one haiti The capital, $4,000
dollars was psid in, an specie, 80 required
By the act Four days after TINS, seven
eights Of the amount was loaned to the
stockholders on psedging their stock, and
giving their notes rcs-wabie once in six
9rtorths ) and within short lime all but
1900 dollars Of the capital was loaned in
the same way. On the 10Th Of December,
sgreeSblyto law, the ether halt ofthe cap
itai stock was paid in by the stockholders.
But il was a mere nominal thing. for on the
same day the greater part was borrowed
by the stockholders as bef1re and within
six months, from that time, IKE zb,ie CAPT.
fG!, excepting 600 dollars 5-GS l0,Hel 10 he cSsa-
ers Of tie stock, AID 50 Continued III. .4sgaSt,
1909. At might therefore be. uuT called
Bank soithout capital erected, not bp ihose
yocV. in the mean time an amount equal 10
the capita! StCcS, or nearly SO, WAS loaned
TO others, and very wide cncaialion Civ
ell TO the bills: So that in June, 1902, while
there were but $4,000 dollars If specie in
the Bank, there were about 100 600 dollars
0f bills IN circulation. TIL tins period The
Bank, Notwithstanding the very inIudicious
not TO say highly imy roper manner, in
- 49,
ported is credit toerably well. Conduct
lake this, however, SO contrary TO ali cor
rect principles Of banking, could hardly fail,
sooner or lster, 10 briaE with it disgrace
and ruin. In August, 1909, large sums re-
turned upon the Bank. and there being no
money 10 redeem them, 1t stopped payment
The inevitable consequence was, depre-
citation ofthe ILLS, and great injury and in
convenience TO the holders Of them. At
TINS time the bills in circulation amounted
probably to 100000 dollars. Resort was
now bad to several expedients 20 restore
the credit of the institution. One was tor
the Cashier to draw orders on the Presi-
dent, who was then AT Boston, at 30 days
sight, which was done 10 the amount OK
$4,000 or 10000 a liars bat as he was a.
Die 20 pay but small part OF them, the on
I ~ effect was little delay, and much irriis-
ton. Another expedient was, for the stock
holders, as they could moi pay what they
owed the bank, to sell one half their stock,
and rs inducements 10 purchasers, 70 take
The payment Ia bills Of The bank, which were
then passing al a considerable discount.
a sale was accordingly made 10 nearly half
the amount OF the stock, 10 certain gentle
men ID Boston A third measure was, TO
call in the debts Of the bank; but this, ex-
cepting 10 . trihing amount, was found im-
practicable. All these attempts, IS might
have been fcreseen served only 10 cali in
s 1me ct the bits. II could NOT repienish
the vaults. The new stockholders felt
themselves under no particular obligation TO
support the credit of the bank. Their in
terest, indeed, until they had collected bills
enough 10 pay for their stock, led another
way And Tie truth IS that, from August,
1902, 20 lie present lime, 50 far your
COMMITTEE have been inf) N d, no regu-
Tar > yment las been made Tor the bills
shcn offered At The Bank, aud in January
1910, they were sold il Boston, al 80 per
cent discount, and small Sums even 10 40
and 50 The sum Of bills unredeemed. at
tie las return made 20 tue government.
wss ID N 64 coo doLa.s. OF lhIs 2uount
A., 900 Collars deposIleI AZ the bank, by
ta- Boston STOCKHOLDERS, "a be redeemed
VIII = money can be col coed. and the Is.
iIle, 10, least Abont Iz.Uv0 dollars Of The
tsidue, has been sued and brought 10 exc
lution.
Within month past, an officer went to
The ID alk with an execution Oi more than
5000 dollars. and though lac had access to
tlas x.tfiEu nnI If Al IN. It..I
not dollar could be found, and Tie Cashier
declared lie had not the money 10 pay it
That and other executions, arc sal uusa
tlslied and The bills now sell u four Or five
per cent. discount To give an idea how
difficult it has been found to collect Tie
sums due TO tie Bank, with al the exer-
III rs OF Tie Directors to uhat end, il is found
Nv your committee, that although no new
loans have been made since The failure OF
the Bank in August, 1909, The san, now
due IS nearly as grea. as At was at that time.
Not twenty thousand dollars have been col
i=ctGd AT present th- Bank has no Presi-
dent as required By law. His Honour
William Gray, Esq. has been lately elected.
but has tNer accepted nos declined the
Office. What success viii in future attend
'he exeriions of the directors, TO collect
he cebls, IS uncertain. A large sum, I'm
fortunately Is due from The Directors them
se1ca. he rOU4bhty Is not ia favour oi
collecting much under the present tliscour-
aging state Of our commercial affairs Cal
culAIing from what Las already taken PLACE,
your Committee believe that sufficient can.
not tie cal;ed in dtoiaS The existence ef The
Ch1tsr, 20 redeem The bits n0z9 unpaid
ibe Chatter VIII expire in October,
1912
These are sJIne Of The most important
fsCts and circumstances which have come \