The daily crescent. [volume] ([New Orleans, La.]) 1848-1851, 1849-02-20
The Louisiana State Bank.

The Louisiana State Bank.
The new Directors of the State Bank have pub
! lished a circular to the Stockholders, informing
| them that an examination of its affairs has been
| made, and that it is matter of profound regret
to the Board that its condition is found to be so
unsatisfactory This unsatisfactory condition is
| stated thus:
The unquesonabe losses which have been sustained by
'p By the
sna IN e bS
Orleans Navigation Company si6 693 Is estimated as being
s42 sA a. Deducting from he amount of the unauestioa
able the s%a e to inc G ne sfes
Per cent"
i This is certainly not very consolatory to those
who have recently purchased the stock Of the bank
at the highest market rates, and under the belief
that they were making great speculation by the
transaction. But the Board is far from thinking
the case desperate, and administers to the wonder
ing stockholders, the following cup of comfort:
The stockholders however, need be discouraged by
great value and which will expire until $780, pru
dent an nd impartial MANAGEMENT of il affairs vii! soon
place this ancient institution In the elevated position
cuped under the dIreokion OF It's early administration
The prudent and impartial management neces-
sary to retrieve its affairs, will of be sup
piled by the Board ITSELF the great financial ability
OF the gentlemen composing it, having long been
the subject of praise and admiration in this com.
munity; but it may well be questioned whether
the charter is very valuable as is represented
and many will be found to doubt whether it
would bring in the market the sum of 1921 1927 "A,
at which estimate the losses, even the less
amount of S304,6 "a, at which they are placed
by others, particularly, the circular among other
things makes this announcement:
90 On the Sd inst, the late Board of Directors declared
although tune they evidence before them that
due by the Orleans Navigation Company as good but if
ae eeD
tai TO the amount Of that diuidead"
We have an impression that this statement, be-
ing tue in every respect, and we will not permit
ourselves for moment to doubt its TRUTH that the
charter is worth just nothing at all. When the
charters of the banks revived in 1912, it was
upon the express condition that they should not
violate such charters thereafter, and it was made
the duty of the Attorney General to prosecute for
forfeiture in case of any violation of them. Now,
by the confession of the Directors, the charter of
the State Bank has been violated, and the viola
ton has been palpable and direct" and it would
seem that Judgment of forfeiture must necessarily
follow.
We regret this state of things on many accounts.
The losses to the stockholders alone will press
heavily upon the community; but the sudden
winding up of the affairs of the bank by judicial
process, withou: any arrangement of its business,
in view of such catastrophy cannot fail to work
great deriment to all classes of commercial men,
and others connected with them. Probably the |
Directors did not anticipate that their indiscreet
admissions would involve them in the mesles of |
the law, and render their tenure of office brief and
precarious. They may possibly only have intended
to inform the stockholders how much better and |
wiser they were than the Directors who had pre-
coded them. This might have been as well &C /
compsied without publishing the fact to the world
and making it impossible for the Attorney General
10 be ignorant of, or to disregard it. The business
was not managed with the usual skill of the dis |
linguished gentleman at the head of the direction.
But the confession that the Bank had been guilty
IF "a palpabe and direct violation of its charter"
Vas remarkably illtimed, when, as it would ap-
year from another paragraph the Directors, expect
o make good their losses, in part, by the improve
nent of the Bayou St. John, the Canal and the Old
Basin, and that, if required, they anticipate the
i'd of the State and the municipal authorities - to
ompete the work. The Bank would cut but
orry figure before the Legislature asking for new
avors with an open confession that it had forfeited
IL its rights.
But the case may not be so bad after all as the
ew Directors have stated it. The losses, though
urge, are perhaps not out of proportion to those
ustained by even the best managed banks during
he great crash of 1887 and the following years
nd it may probably turn out that the "palpable |
nd direct violation - of the charter is rather !
trong figure of speech introduced for the purpose
putting climax upon the supposed enormities of
ne old Directors and proportionalely elevate the
ew, who will doubtless conceive themselves bound
} pursue course directly opposite to that which
hey so positively condemn, and pay no dividends |
hateUer until The accumulated profits of The Bank
hall hare replaced the sixteen per cent deficit in its
lp'taL This course may in the end be the best |
n the stockholders, but it will have at present no
cry advantageous effect upon the market price of
leir shares.