Daily Richmond Whig. [volume] (Richmond, Va.) 1840-1842, 1841-04-17

Il
ing up its concerns, and among-the first measure
taken TO that end, to sell or dispose Of IS "a
and as speedily could be effected, the assets @
IT'S several branches. This was generally done q
State Banks, who gave for them the obligations
payable by instament at distant periods. At In
same time. The policy was adopted of convertin,
active debt into loans upon the security of stocks
oy which permanent investments might be .proyi
ded for the capital Of the Bank during the long ne
ROD OF us anticipate liquidation. On the 9Th o
Maich, 1885, THE President submitted to the Board
general view Of the situation Of the Bank, il
means and liabilities, its circulation and deposits
and the probable future demands upon il, showins
It's ample resources and power Of expans on: where
upon" the committee OF Exchange, which was com.
posed oil three Directors, appointed by the Presi.
dent, were authorized by the Board ito make loau,
on the security of the stock Of this Bank or othe,
approved security, and necessary, at lower rae
than SIX but not less than i've per cent. per annum
This delegation of power to the Exchange com.
mlttee, was never expressly and formally renewed
under the new charter, unless it be considered as
included, under general resolution of the new
Board adopting "the Bye-I.aws Rules and Regu.
latons" OF the former Bank. BY the statement O
inc condition OF the Bank upon the 2d of March
1885, the whole amount of loans upon Bank stock
and other than personal security, WAS 81 1877 93f
20 cents, while by that OF March 3, 1886 these
loans had increased to the sum of S20,iI6, 367 IS
cents Under such circumstances, the active means
o the Bank were comparatively small, TO pay the
"''h'NNi'Nc utulhnu OF the state Tor The Bonus 10
settle with the government of the United States for
It's stock, and TO meet its circulation OF $40 227
Do cts, which, contrary TO tn, anticipation expres.
SEQ nj IN period OF its re-charter soon began TO be
rapidly presented for redemption. The Bank was
OF necessity driven into the market as borrowers
anc very soon the hrst step was taken to obtain
loans abroad, by sending the Cashier TO Europe 70,
that purpose. Two loans were accordingly neso-
tiated by him; one in England, OF Ell 900 900 ster.
ing; and another in France, ,of l2, 500 600 francs
on favorable terms.
In order to provide for the payment of these Loans
and to negotiate Others and in general TO superin
tend the interests OF the Institution abroad il was
determined by the Board to have a General AGENT
residing in London, and on the 22d Of September
MIR Samue Jaudon, then Cashier, was elected TO
that post and his agency there commenced accord ..
ingly November s, 1887.
AT the same time, the Bank entered the Foreion
and Domestic Markets as borrowers, upon thier
Post Notes and Bonds payable in Europe. The
whole amount obtained in this way at different pe.
RODS up TO July, ls4O, being more than twenty
three millions.
From these causes, as well as from the general
arrangement OF affairs, the suspension of specie r.v
mentS, and the dscrejIt consequently thrown uno,
American securities, and more particularly from tho
course OF the Banks dealing in Foreign Exchange,
oy drawing Bills TO large amount without bav,ng
previously provided the funds for their p,v,nent
and thus suhjectng their agent in London To the
necessity oil obtaining money in haste in order 10
MAINTAIN the credit OF the Bank, il was no lone,r
found possible 10 command funds there upon line
same favorable terms as before. And accordingly,
upon Mr. Jaudon's subsequent negotiations for
Loans, 10 the amount altogether of 1922 697 dol
lars 46 cents, there is chargeabe to Losses the sum
Of ,l49,9O7 dollars, 4 cents, being Tor Discount
Commissions TO Foreign BInkers, and other ch,,,
gesi not including MIR Jaudon's own commission.
and the expenses ofthe Agency in London, amount.
ing up to January !, 1871, to the sum of SO 344
pouncs IL shIllngs pence sterling, which At nine
per cent exchange is equal to 1856 1897 dollars 80
cents. -
Ii may be proper to explain, in passing, how this
large sum for the expenses OF the agencies in Lon.
don arises When MIR Jaudon was elected 10 the
place OF foreign agent, he the principal cashier,
at a salary OF $1,000 per annum. The Bank nail
the loss on the sale of his furniture S5O74 and the
passage OF himself and family to London further
sum Of SlOl5. tie was to devote himself exclu-
sIVey To the business OF the Bank to negoli,t. m
uncovered credtin England to provide for the then
existing debt IN Europe TO receive its funds TO nav
ITS bills ard dividends, to effect sa es Of stocks and
generally TO protect the interests of the Bank and
"the eou0trY al large" For these services ne was
10 receive The commission heretofore charged and
allowed TO bArng, Brothers 4 COMPANY equal 10
about S2s OOU per annum. In addition to which
the expenses the agency were allowed him in
GLIDING a salary OF 1000 pounds sterling to his bro
Their, MIR Charles B. Jaudon as his prIncipaI clerk
FROM Tue increase OF money operations, ar SIN,
n
upon which commissions were charged was greatly
augmented, so that the sums paid him for his ord;
nary services up 10 January, ISII amounted NJ
nine per cent. exchange, to SI7S,O4 A. and tb.
expenses OF the agency TO s35, Ice 90. In addi-
ton 10 these sums he Hove ed hy the FYrbano.
COMMITTEE, an extra commission of one per cent
upon loan effected ia October 1899 of s0O OOo
pounds, say S3S,755 sc, and upon his claim for
similar commission upon subseq ent loans in Francs
and Holland, to the amosnt OF So ,337,I4l 80, the
board OF directors, under the sanction of LEGAL
opinion, from counsel Of high standing and The
views of the former President by whom IN. agree
meni with MIR Jaudon was made that the case of
extraordinary loans was not anticpa ted nor meant
TO be included in the original arrangement, allowed
the further charge Of SS3,97O 81. These several
sums amounted to 1886 1877 80, as Lel,re stated
Such were some Of the results Of the resolution
OF March, 1885, though cannot be Questioned thai
much may be attributed TO the unhappy situation of
the business and exchanges Of the country concpr
ring with the unonunae policy pursued by the ad.
mlnlstraton Of the Bank. Thus he Institution has
gone on, TO increase It's Indebtedness abroad mil
It has now more money borrowed IN Europe than
II has on loan on It's list OF Active Debt in Ameti
ca 10 This has been superaddsd, extensive dealing
IN stocks. and continuation of the policy of oan.
ing upon stock securties, though it was evidently
proper upon the rechArter, that such policy shou
be at once and entirely abandoned. Such indeed
was ITS nvowed purpose, yet one year afterwards
an March, 1887 its loans upon stocks and Other
Than personal eecunty had increased S7s2I5II
while the Bills discounted on personal security. and
Domestic Exchange, had suffered dimjnu ion Of
OF S9,5l6,463 -. IL seems TO have been sufficient
10 obtain money on loan, TO pledge the stock Of an
incorporated Company" however remote its one
rations or uncertain IT'S prospects. Many large loans
originally made on pledge Of stocks were p,id for
IN the same Kind OF property, and that too nj par
when IN many Instances they had become depre.
cated IN value. IL IS very evident TO the Commit.
Tor hat . an If r
themselves engaged in large operations in stocks
and specullilons, Of a similar character with funds
obtained OF the Bank, ard at the same time Loans
were m de 10 the Companies in which they were
interested and to others engaged in the same Kind
OF operations, IN amounts greatly dispropurtionate
10 the means Of the parties. or TO their proper and
legitimate wants and dealings. The effect of this
system, was 10 monopolise the active means of the
Institution, and disable !. from aiding and accom-.
modating men engaged ~ business really produc
tive aud useful 10 the community; and as MIGHT
nave been anticipated large part Of the ms thus
loaned were ultimately lost, or the Bank compell-
60 on disadvaniageous terms 10 price 10 take in
payment Stocks, Bank Lands and other fragments,
OF the estates Of great speculat0rs
Ire loose and irregular manner, in which the bu-
sness OF IoaBing money was CONDUCTED, tended
greatly oproduce this result, and deserves parcu.
lar nouce and explanation, From March, 1886, the
period OF the passage OF the Resolution above re-
ierred TO, the chief control and MANAGEMENT Of the
shalrs Of the Institution, appears 10 have pnssed
rom the hands Of the Directors. The mode in " birb
the COmmttee Of Exchange transacted their bu,i-
ness shows thot there really existed no check
Whatever upon the Officers, and that the funds Of
lhe Bank were almost entirely ut their d,sDosition
That Committee met daily, ond were att,Gdsd lao
he CashIer and AZ times by the President They
exercised ihe power Of making loans and settle.
ments TO lullns Rrrat on extent as the Board ,seC
tinIy. HeP' no mlou'es o. their proceedngs-n0