The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1852-11-30
Our Wass inetOn Correspondence.
WASHINGTON, Nov. q, 1852

The Banking System in Washington.
Banks and banking in this city have lately oreatsd
such an interest," if We may judge fro the frequent
illusions made to them, in all directions, that
plain statement Of the facts will not be out Of place
Within the last six months there have been s'es-
tahlished' here something like thirty "banks,"
The greater number of these concerns are owned
either in New York city or Virginia They issue
small notes of from one dollar up, and are redeem
able, not in gold silver, but in Virginia notes,
when presented in sums Of Eve delars. Virginia
money ia. at discount here of about one-half
per cent. The system Of issuing these indivi-
dual promises to pay, redeemable in deprecated
currency, was 6rst commenced by Latham, now
Selden, Withers & Co, some years ago.
The issue Of one dollar notes is in direct
violation Of law; but, nevertheless, 50 profitable
il it found to be that the 6ne for such illegal issue
is ehecriully paid whenever it is imposed Selden,
WiheIs Co. offer security to the public for the
payment of their notes than what may be found in
their personal promise to pay. They never make an
erpose Of their business, and the only limit to their
i-sues is their own inclination, the facility with
which they oan pass their notes off. As their notes
are only redeemable when presented in sums Of 80,
it can readily be conceived that among the laboring
casses large sums must al ways remain floating.
The example thus set by Mr.. Lsth am and Selden,
WtbeIs s Co has led to the influx Of similar spscu
lations and hen the number OF small note bauks'
recently started by individuals They may ali be good
but they none o! them any thing than indiv
dusl promises to pay, issued in violation Of law, and
not secured in any way.
The "Bank Of the Republic" one Of the indvi-
dual note concerns, redt ems its issues In gold and
silver, and in this respect differs from the others,
and so far 10 deserving of praise.
What renders the whole matter more singular is
tho fact that the government or its officers, deposit
the pubic funds with some of these banks" thus
encouraging their violation of law. This should DO
looked into by Congress, II ia manifestly wrong
that any public funds should be placed in the keep
ing ST "banss," no matter how solvent, which
mantsIed in opposition TO law.
The only banks here which are "secured," aud
which not doing business in open violation Of
law, are the Bank Of Washington, Bank of Metro
polls. and Patriotic Bank, all Of Washington, and
the Bank of Commerce, Georgetown These banks
originally established by acts Of Incorporation
from Congress. Some years ago they were Grec. led
to wind Up their concerns, and trustees we're appoint
ed BY the wording Of the act this is construed
into perpetual act OF Incorporation aud the insti
tutons have continued to do regular business
their stock commanding high price They publish
regular sworn statements of their issues and asets
and regarded as IN excellent sanding. They
issue notes below the deromn of ave dollars
Ali the otherso called bsnks'' are mere individual
concerns with security for the redemption Of their
Issues, other than is to be found in the honesty
of the parties signing them Many of them have
not even shingles stuck up to show where they
redeemed
It is TO be hoped Congress will either pass .
free banking Law, as iu New York. or effectualiy
suppress the issue of notes by individuals.