Lynchburg daily Virginian. [volume] (Lynchburg [Va.]) 1852-1861, 1852-09-03

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mount of notes outstanding, and all the other
asets held by the bank. To show II more
iainly in figures;
oppose the bank issuing notes for ..S3oo'oo
II has security to pay.
l. State Stock or guaranteed bonds SSoo'ooo
2. Coin on hand 1-5.............S6o,ooo
3. Bills AMI notes discounted say .Ss30o'oOo
$500, coo
a security of more than two dollars to one
or the solyency OF the bank and the redemp-
ION Of tho notes in specie. In the current
transactions of life this would DE deemed am
ple by the most cautious dealer, and were It
not so in his case, we could easily show that
this security is here even more than three 10
one, afrording TO the note holder the most am
pie protection even in time the most pressing
and disastrous to the institution itself.
As in matters Of business gsnerally J, good
credit is an important part of the capital en-
ployed, SO especially is this true in the opera
ton Of banking, and as the strength and per-
manency of thas credit must depend not only
upon int gritty in the management of Its affairs
but upon the public faith in its ability, at all
times and under all circumstances TO meet the
demand made upon it, we can perceive no
good reason wherefore the notes of this bank
should not pass as current as gold and silver,
and be IN fact as safe to the holder. No rea-
son why they should ever be at a discount Ell
thcr at home or broad, and Of consequence no
cause TO apprehend a run upon the bank for
specie.
5. Will an investment in the Stocks be judi
cious and safe TO the Stockholders
AS soon as $10O, 900 in State or guaranteed
bonds are subscribed and the bank has l Is
of that amount in specie, it can commence
operating, by issuing bills to the amount Of
800, 900, and so from time to time as it in.
crcases its Stock, it increases its issue dollar
for dollar.
Let us now suppose, Stock taken TO the
amount of $l20, 900, and the bank doing bust
ness solely upon a sum equal to her own notes
what would be the result to the Stockholders
6 per cent paid by State on $4,000 State
6 per cent made by the bank on her
own notes for 100000 actively
employed. ..$6,O o0, 90
Annual gain ofinterest .....$12, 100000
OF 10 per cent on 1920, 900 capital invested.
In tits view nothing if said ofcontingent ex.
penses nor of the profits arising from other
sources 10 the bank, (such as purchasing bills
of exchange &c, as these would probably be
a fair offsett.
So far from thinking this an exaggerated
statement Of what the profits would be. We
are satisfied that it is below it, and that the in
~stitution as its capital increased could as well
and as easily pay a dividend to the Stockhol-
ders of12 per cent as 10. The Savings Bank
here, afierpaying ar interest to depositers of
between 4 and 5 per cent, have for years past
paid a dividend of from 8 to 10 per cent, and
the profits Of the branch bank in this place for
the last 10 or Is years has been equal to at
least 10 per cent on tleir capital.
We have every reason TO believe that the
new Bank, located in our midst, and the Stock
held by our own citizens, would be equally
prosperous. We are fully satisfied that the
Stock would be not only a safe but profitable
investment, and that the speedy establish ment
OF the Merchants Bank would exercise q heal.
thy influence upon all the industrial pursuits of
town and country.