Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1857-09-25
WHAT SHALL BE DONE WITH THE BANK OF
---TE TENNESSEE J---------.-
Among the numerous Questions that are likely to

WHAT SHALL BE DONE WITH THE BANK OF
.-T TENNESSEE y --
Among the numerous questions that are likely to
come before the next session of the Legislature
none are Of graver Importance or more difficult
Of solution than the one with which we haze
headed this article; it is WE'LL therefore, that we
should look to and begin to investigate The subject
in advance.
No evil with which the country has been inflicted,
has sprung up more in opposition to the wishes OF
the people than that Of Banks. There was never a
time when these institutions popular with the
people. We question very much whether any one /
Of the numerous charters that have been granted in
the history of our Legislation would have been ap
proved if submitted to their votes And vet. in |
view of this fact from their earliest history instead
of diminishing, they have continued to increase
upon the State, until we are now flooded with their
rags in the shape of promises to pay The very fact
of their tendency to increase and the difficulty Of
getting rid Of them should long since have aroused
the opposition of the people.
How far they can be restricted or curtailed are
important questions to be looked to in subsequent
legislation and the initiative should be taken at the
approaching session.
The Bank of Tennessee, of which it is our present
purpose to speak, in original design, has proved
fruiless experiment and failure as will be seen nv
the extract below, which we copy from the Report
Of its present able President to the last session NJ
our Legislature We are there told in explicit Ian
guage that " The operations of the Bank in few
years. Eeem to have convinced the General Assembly
of the iHpracticabiHty Of accomplishing the aren't
objects Of its creation " hence the act passed in 1910
directing the profits of .he Bank to be paid into the
Treasury and the payment of the interest on the
Bonds of the State and the School Fund to be made
by the Treasury In view o. this state of facts and
the hsEards of the system, we we're told bv the
President that the Directors had come to the con.
clusion with great unsnimity, and from settled
conviction that the best interests of the State 70
qiire it, that the Bank of Tennessee should be put
IA iqu lation, and its concerns closed at as early
period the convenience of the citizens will allow
This matured wisdom of the Board met the cordial
approval Of the people throughout the State.
The reasons by which the President and Directors
were led this conclusion are plain and convincing
in their character. The same arguments ASSIGNED
then may be assigned now, and, if any thing. with
increased power For the benefit of those whose
business 1t is to investigate the subject we amend
the following from their report and ask for it a
studied perusal:
The creation Of so many new banks at the last
session of the Legislature in addition to those thai
existed before produced much competition he
tween them as will, in all probability reduce the
business and profits of each to a point so low as
not to justify the continuance of ali of them; and
in the conflicts likely to arise from such competition
svgfs Yr4f1o hn1o ,r1v 3 Il,
the Bank Of the State is at present is likely TO be
made the victim Of the selfshness and cunning Of
others more interested and more skifuu in tbei,
management than inexperienced citizens can be
and as the Legislature cannot now recall the char
tiers granted TO Others the Directors have come to
the conclusion, with great unanmity, and from a
settled conviction, that the best interests of the
State require it. that the Bank of Tennessee sbouId
be put in liquidation and its concerns closed at A.
early a period as the convenience of the citizens
will allow
The Bank Of Tennessee was established for the
purpose Of creating /" fund for Internal Improve
ments," and to aid in the establishment of a system
of education.
The operations of the Bank in few years seem
TO have convinced the General Assembly of the i'm
practicability Of accomplishing the great objects
Its creation, under the organization which had been
given IL; and an act was passed in lS49 directing
the profits Of the bank TO be paid into the Treasury
and the payment Of the interest on the Bonds of
the State aud the School Fund 80 be made bv the
Treasury; by that time, near million of dollars
had been taken from the capital by appropriations
Of the Legislature, and the debts lost by the bank
By the act Of the Sd March, 1854 the annual profits
Of the bauE we're directed to be applied to supply
the deficiency of the capital occasioned bv bad
debts. So that the bank cannot be regarded al
this time, in any other light than financial roieci
TO aid the Treasury Of the State. Il can scarcely
be doubted, that an investment of the School funds
gaw,-a IL.
bonds Of the State, bearing interest of six per
cent, would have been a more wise and iudicioUs
disposition of them than in the stock of any corpo-
ration yielding nOminally two or three per cent
more; and especially in one which was subject from
ITS organization to all the casualties arising from
the change of its officers every few years as the
one or the other party prevailed in our elections
and to the carelessuess, negligence, or frauds OF
those controlling it. The other portion of its cant
tai belonging to the State, million of dollars was
obtained by issuing Bonds of the State bearing six
per cent interest and upon which the State now
pays interest, and will be compelled TO pavwbpf her
the bank yields profit or not
From the operations of the bank, heretofore
there Is strong reason to apprehend that losses of
similar character. may occur hereafter and thai
the profits by the time the charter expires NAV he
required TO reinstate the capital as now required by
the act Of 1854. Under such circumstances il
would seem TO be the true policy of the State 10
pay the million Of dollars for the bonds of the State
whilst 1t has the means under the control Of the
bank and 20 invest the school funds in other bond,
Of the State, bearing interest and thus avoid the
hazards incident TO borrowing money TO be reoaned
under the control Of any corporate body. The
public Is seldom benefited by such financial schemes
Ii the money has to be paid by the citizens, il
makes but little difference whether it be done
through the Treasury by the profits on discounts
and loans made 10 them through such a corporation
the more direct the mode adopted the better gener
ally for the citizens. 1t is, in the opinion OF the
Board Of Directors, no unimportant matter to avoid
The danger, seriously apprehendcd by many. of sub
Jecbng The citizens to taxation for the payment Of
the debts created for the establishment of the bank
which would be the case in the event of any serious
disaster happening TO it, before the expiration OF
lis charter. The fund now belonging to the State
aud now IN Bank, will 90 far toward extinguishnC
the present Indebtedness of the State The present
time seems to he more favorable for the accom-
plshment Of this object, than any other for years
past or there may be for years come. The circU-
lauon Of this bank, is less than it has been for
years, and il Withdrawn, its place will be at once
supplied by the numerous banks now in operation,