Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1856-01-18
INDEPENDENT BANKS.

conference.-the opponent; of the State Stock or
independent: system of Banking. do lOt appear n
understand the restriction. which are contained N
the acts authorizing their incorporation. The object
of the founders OF the State stock sy,;en Of banking
IN this State, evidently WAS "a establish institutions,
which. under all circumstances, would prevent loss
To the note holders. This class OF the community Is
much larger than tlIose who are connected with bank-
my institutions III o;Icr capacities. Almost every III.
dividuul in the State has, q; tunes, i'll bis possession,
d bank note Of some denomination. Those who are
interested Us Stockholders, and those who rectivu nc
curlmodHtions from the Banks, are few compared
with those who become posserscd of bank notes. II
is the duty Of The General Assembly TO leg!slate tuI
the benefit Of tie larger class, and hot for the smaller.
With the enunriu,ion uf this nconrovertible doc.
trine. il is only necessary 10 refer 10 the charters nt
the independent Banks, to demonstrate how much
safer that system IS 10 the nu'c.iolder than tue old
branch Bank system is.
BY reference TO the session acts OF 1851, il will
be seen that only one independent Bank was incor-
oora,ed-''rhe Bank OF Guyaudotte." The 81 Fec.
lion Of that act reads tSas:
.tSIc. 3. Whenever the said Bank shall legally
transfer TO aud Gcpo.i, with the Treasurer OF the State,
ia trust for and for tho purposes of said Bank, certifi-
CAKES of the public debt OF the State, or the bonds Of
any Improvement company or companies guaranteed
~ ,i: State, bearing six per ccntuin interest, TO the
amount Of one hundred thousand d"liur-, the said
Bank ": GnyurGottc shall be authorized 10 deliver
notes of any denomination il mn" selcc;, no: under
i've dollars, TO the Treasurer, in tie usual form q!
b1,k notes lDtLnIcU Iuf C.TcuIuliDn, 10 Tue lNI! AMOUNT
Of the stock 81 deposited. upon the face al which shall
BE- written or printed he words, Secured by pledge I'll
State securities and ouch bank note sIai! he counter
signedhy the Treasurer, ant numbered and r. s'sterc'l
in proper book, h. ne provided npd Kept for that pur'
nose in tl,. oiicv uf sn;d Treasurer. And slch notvs.
so counlyrSi med, shall bc re-dclIvercd 10 the officers
Of sail Bank; and the euid Bank. go receiving The
same, may thcrGufeu issue its noies Aforesaid 10 the
iui. amount Of the stock or guaranteed bonds 80 de-
npsitcd, aud none others whatever; and from time to
ti,,. mon FurInIr i.npsIfg pf surh certificates oil
debt or guarantees Of the State by said Bank, ~ rum.
Of not less than five thousand dollars, the sad Bank
may therrupor, in Ike manner, issue NOES, counter
signed as aforesaid, Ia the full amount go deposited;
but such Issues shall not. III the aggregate, exceed Tie
capital herein provided
There ran be- no loss to the note holder under that
section, unless the State of ' virginia rrp"9tdies lei
just debts, aud the opponentso Of The State stock system
will not pretend that such is probable, Or even possl'
BILE.
But, not satisfied with the security which is "bliga-
tory on the Commonwealth, The stockhohd,rs III these
institutions are made to undcrwriie the State. Their
property is made iiable for the redemption ei all the
debts Of tho Bank. TIiis requirement has the happy
effect TO secure the closest attention 20 The manage.
ncnt of the institution by those VIII" invest their cap
ial therein. Tie Sth section of lie sct 10 incorpo.
rate "iLe Bank Of Guyunlutt-," rs;is n t"i!"w,: :,
'SEc. s. Each aud every stakeholder III SAID Bank
shall be liable rut.pbiy uut Ui lis private estate iof
the c, culn;io;. aud the express contract debts OF said
Dunk, 10 IT,. amount Of stu:'N held by him, upon the
failure 0i said Bank Ia redeem lis nutcs or pay hall
,i.bl-. The total amount Of Inc paper circulation OF
the BANK hereby Incorporated sL8H never exceed
Eve times the amount of coin III possession ana ne
tually tho property OF the Bank. If the coin bs re.
duccd to lcas than c.fllh Of its paper circulation,
the Bank shall theuccturti make NJ new lnnn or
discount until lis coin shall be 10 lis paper circula'
ton at ieast the proportion of onu To I've provided,
however, that this net shall not lake effect ~ rs IL
authorize the snid Bank 10 make lonus or discounts
or transact any Other Banking business, until ihc
minimum amount Il. .He capital hereby authorized
shall be deposited III State Stocks Or guaranteed
bonds as aforesaid with the Treasurer of this Com
moawral,h, rs is provided by the fourth this means
the ;a'ri sec;ion.) section of THIS act. The rosts I,
the SAFE arising rom The provisions Of this nc! sliai
be paid by The said Bsuk."
IL has Gecn urged against the State Stock system
that the capital of bank can be- duplicated. Such
is not the tact. Whatever may have been the errors
in the first Of tie acts Incorporating Independent
Banks, past Legislatures have manifested an urgen
desire 10 perfect the system. However aver'e gen
tlemcn Legislators may he 10 impose restrictions ui
the old Banks, which the public voice outside o
banking institutions, md among that lucky few witt
are he peculiar fdvoritcs Ct the old Banks, Geniand'
as necessary and proper, none of tina: dcllcn'e scnsi
h:iitv hus been manifested towards the State S."cH
Banks. Ii n suspicion was whispered that there WI:
an abuse existing in the operations OF the ~lndrpen
dent Banks, forthwith, amendments were suggested
, 10 correct the evil. so whrii !! was intimriru Il
probubic that Il Bank could take It's notes which la;
been ':uunterstS nc't ny Tue Iic"rhfcf, ana puI'H"S'
other bonds. on which they c"n;d :ssue other notcs,
sec,io!. was prepared aud adopted which eh%ectGnIi.
prevents any such operation. Sre section , Of In
act Incorporating The Bank Of Liuyandui;"':
SEC. y. That before The Treasurer of the Com
rnonwua!iil shall coua:crsicn any of the notes OF cir
rulsiiuu for said Bank. The President or Cashie
thereof shall furnish IN the said Treasurer n state
mrm,, verified by affidavit "t said President o
Cashier, showing tho a;nnun. o! capital stock sub
scri5ed 10 said Bnuk; and the Treasurer shall up
cuu;.t.rsisn ur:us o.! circulation for said Bank 10
larger amount thun the capital actually su6scribe'
aud paid in
Can more be Necessary than is contained in ,hes
provisions 10 secure the note h"ld-r What evldenc
has q holder Of the notes OF either Uf The old Bank
that he is secure from loss To be sure, the publ
accords them q credit, but who knows If they dcserv
III The credit OF neither of these institutions is be;
ter than Was that of the old Bank If the Unite
States. and the iale of tEoso who were stuckiIoIder
IN, and nnre.lIuiGcrs 81 that institution, Is well reTem
bercd. Everybody lost by tia; Bank, the s:rongcs
and best Of tbs Banks with hrarcl's. II Dtnocrd
.,c pr;uc,uics cannot ir1uenc" the mrjori;y Of the 1t
-%,i,in,urr 10 90 right, il IL at least expected that III
experience Of tie past will at least teach some 'nc'
.Ir. nf wisdom in the future. 7. p.
49,