Lynchburg daily Virginian. [volume] (Lynchburg [Va.]) 1852-1861, 1856-02-20

| arations for a return 10 specie payments, ant
we're required to make none On the tifst ct Jan
uary. Isl2. the Bank of Virginia, the Farmer
| Bank and the Exchange Bank. owned less spe
Gle by the sum Of S27 ISL % than they possess
| ed the Let of january 1sII; but while their spe-
Gle was decreasing. they had increased their err
| culation by the sum of 1884, $50 81 aud ,heii
| loans and discounts by the sum of s661 .362 Do
| 1t is a curious fact, appearing IN report maze
iu the Bank Committee of the House of Dtleg-
ntes. that If this increased outstanding debt,
81 ] 675 were loaned to fifty eve members OF the
General Assembly Sir, our banks would never,
in my opinion. have voluntarily resumed the pay
ment of specie. 1t was only enforced. at last IN
Virginia, after all the other Banks in the Union
had resumed. by the sovereign voice ct
people aroused and indgnani--lung suffering.
hut unable longer 10 sutherland speaking IN
tones at length. which aowed aud subdned both
the Legislature and the Bsnks-whioh sienced
even the protesting cries of monopoly, aud en-
forced obedience upon hitherto unhrded corpor-
atinns.
Many who hear me, older that myself, may
have personal experience and recollection OF the
oalamiiies of this hong period of suspension. and
| will not pause Ia attempt their inadequate de-
scripton. Ia our commercial history. they
stand out in gloomy relief Yet are require
I'd To believe that the banks, whose notes IN SIX
iy days after the first act of suspension depre
oiated more than 81 1000 600 in III" hands OF
their holders whose actual repudltlon largo.
ly exceeded s2,0O0,oO0. if you calculate five
years interest on their suspended debit payable
on demand To the holders Of their notes; whose
expansions and contracions of credit involved
in hopeless ruin thousands of oar citizens
were innocent Of all mischief We ARE To bellse
that this system Of banking has worked well Tor
the State. when Sre these banks lending Out
nearly three times their capital upon the eve OF
repudiaing their contract: aud making their lar
gest dividends during the period OF their rcpudia.
ton II these institution have been always SO
admirably managed why, let il be asked, did they
not pay specie in 1916, like the Banks of New
England Why not from ~ to T. like the
Banks of Charleston Why continue their re-
pudiation much longer than the Banks of the
neighboring Statasl Why continue it for more
that four years after the Banks of New York aud
and New England had permanently resumed
specie paymentsl
Sir, this old system Of banking has mol worked
well IN The past il does not work well now.
deprecated currency annually expanding and
contracting and always distant from its points
Of redemption attests thai it is n failure mud
more, that 1t is II curse To our people. Nor ,cs
il even meet the business wants of merchants
in our cities. For our trade is made tributary
TO the North by the usurious dealings OF our
banks in exchange; and commercial enterprise
amongst langui-hrs for the wnnt oi many
millions of Virginia capital which they have
loaned 10 Northern spectators i'll our products
FIVE of these old banks, sir. Mt the very time
whom they apple, for re-charters, at our last
session, had loaned their credit 10 amount TX.
oeeding by 81 5000 - the limit prescribed
by the Code There was n violation ofthe law,
repeated since, from time to time, tho most dis
nstrons III its tendencies that il was possible for
these banks To comL.it, n violation esteemed So
dangerous by the bank rctormers of 81, that, III
the general law of that venr, they declared that
the directors of n bank should be liable, out of
their private fortunes. for any excess Of their
loans above the limits, which are now so often
exceeded. Bv the report of the Secretary Of the
Treasury for 1883, II appears that, with a bank
ing capital of about four millions loss than that
OF South Carona,we had about the same amount
of loans aud discounts, and with a banking capt
tai about rqunI TO that of Georgin, nenriy double
the loans aud discounts. BY the seine report!
1t appears that in every one of fifteen Statcs,cm.
bracIng all the New England, Middle and south
rrn States of the Union. The aggregate circula
ton of the banks was less than their aggregate
capital except in the States of Nirgna. North
Carolina, Alabama, and Vermont. While the
circulation in Virginia hears to the capital the
proportion Of about | ! 10 t., II is less than hall
the capital in New York, Massachusetts and
Rhode Island; in the proportion Of about 10 II
IN Louisiana, TO II in Georgia, 9to 10 IN South
Carolina, aud to in Maryland. If we have
been without revusion tor fourteen or fifteen
years. we owe H. Mr.. speaker, not 10 our bunk
ing system in Virginia, but to tho bnnk reforms
in London aud New York, the great centres of
commerce IN the two hemispheres to the much
abased Independent Treasury, and Ia the large
and unprecedented approximations in the supply
of gold which have been furnished by Australia
ana California.
But, sir we are told. not only that the old
banks of Virginia are the best III the Union, bur
that their excellence is due to the existing syS-
tenn of mother banks and branches! What was
the original purpose of these branches! To
give us currency of uniform, yalae, rcdeenahlo
hot only by the parent banks, but by their
branches in all parts of the State. They have
not only failed Ia accomplish this object but
have been used as n means 10 dcpreciate our
currency and destroy its coutr"yerilbillty. The
operations Of these branches are neither con
trolled by the mother banks nor subject To the
restrictions of the oohe. Examine III" detailed
statement of the branch banks, contained in the
documents of the lat session, giving sixteen
quarterly returns of their condition for the iuui
years which preceded the lst January, l65l.-
You will find numerous instances in which Their
circulation is more than double their capital, ant
in which both their circulation aud their discounts
greatly exceed the highest limits allowed by the
law. The circulation If the branch bank of Nir
GINA. at Buchanan on the LIST July, 1851, wa
then three times its capital For almost every
return throughout the period of four years. th'
circulation of the branches ct the same bank n
Danvlle, Buchanan and Charleston, NOR,
than d. uhle the oapitnl;ana the circulation of til,
branch of the bnnk of the Valley at Stuuuton wa
often nearly three times its capital. SOFT Is, il
numerous cases, with the branches of the otho
banks BY each of the four quarterly return
for 1850. the discounts of the branch Of the Bunl
| of Virginia at Dauyllc exceeded three time
the capital; and throughout the whole period, III,
discounts of the branches of this bank at Dnnviile
Buchanan and Charleston. largely exceeded dou