Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1858-07-06
From the Memphis Appeal.
RnnI, of Tennessee.

BANK OF IeHHesSees
We are permitted to place before our readers the
annexed letter from the President Of this Bank (
giving the reasons which induced the late COnven-
lion Of Bank Presidents to decline resumption of
specie payments for the present
BANK OF TENNESSEE, June &c, 1858.
DEAR SIRs: received yours of the 22d, inquir
ing of me the reasons why the Convention of the
officers Of the Bank Of Tennessee, lately assembled
in Nashville, did not resume specie payments, and
when it was probable this would be done In re-
ply, have the honor to state that on the 2sth Of
January last the General Assembly passed an act,
imposing important rules and restrictions for
the future management of the Banks in this State,
which were believed to be necessary to protect the
citizens against the eontracous and expansions of
the Stock Banks, which we're then heavily pressing
on the people To enforce these restrictions, very
heavy penalties were imposed. First, violation
of either of them was made forfeiture of the char
ter of the Bank. Second, no contract made by such
Bank could be enforced st law or in equity Thir',
the officers OF the Bank were made liable to indict
ment and heavy fines imposed for the transaction OF
any business after violation of any Of the restrc
tons Fourth, it was made the duty of the Cover
nor to proceed Immediately against any Bank vo
latiBg the restrictions and their assets TO be placed
in the hands of trustees for their liquidation The
Bank Of Tennessee, being under the absolute control
the Legislature, was bound by these restrictions and
liable 10 the PENALTIES for violation OF the law, thus
placing all the Banks Of the State upon footing of
equality in the transaction of business and cub
iected TO The same penalties for violation of The
duties imposed upon them The Legislature,
learning that many Of the Stock Banks, well
as Free Banks, would not probably accept the
provisions of the law as part Of their charters,
and that they set up claim of "Vesed rights,
and that the question would have to be settled in
the Courts, determined not to give them such
advantages over the Bank of Tennessee, they
| would have should their claim of rested rights
/ be sustained by the Courts, and passed another
! law on the 18th day of March, giving them
] three months to accept its provisions, aud at
| the same time, for the protection of the Bank
/ of Tennessee, directed that it should not be com
! PEELED to resume specie payments ''uHta the Union
and Planters Banks shall file their acceptance Of the
provisi0as Of This act" and the of January, sand
If they do not accept hePrOrisions Of sand acts The day
of resumption shall be left to the discretion Of the Presi
dent and Directors" Early in June, thestockholders
/ in both those Banks had meetingin Nashville and
resolved not accept the provisions Of the two acts
as part of their charters claiming the right to do
business under their old charters as formerly, and
mainly as il is understood, because Of the severity
! of the penalties imposed by those laws.
Under such circumstances, the Convention of the
officers of the Bank and Branches met on the l4th
of June. They were fully advised of the proceed
ings of the stockholders of the Union and Planters
Banks and could not fail to the great advantages
the other Banks, acting under their old charters,
would have over the Bank of Tennessee acting under
the new laws
The danger, which the Legislature apprehended,
| and which was we'll understood by the Convention,
consisted in the fact that the Bank and Branches
had felt it their duty to keep circulation of
two to one for its gold, to protect the people
against the contractons and expansions of the other
| Banks and in the event Of resumption, combinR-
ton of the other Banks, or a small portion of
them might force some Of the Branches to stop specie
payments second time, which, under the new laws,
would be forfeiture of its charter and the right te
collect its bebts and its assets placed in the hands of
Trustees for its liquidation. Such a combination,
the Convention saw, could only beTesised by cur
tailment of the circulation of the Bank and Branches
so as TO have gold dollar in their vaults for every
paper dollars in circulation which must necessarily
add to the stringency of the money market and i'm
pose such new burthens upon the people, and pre-
vent the possibility of its making the usual dividends
for the State much needed at this time, for the
payment of interest on the State debt.
If the stockholders of the Union and Planters
Banks declined accepting the provisions of the new
laws, Oh account Of the heavy penalties imposed
for violation of them, why saOuld not the officers
of the Bank of Tennessee avail themselves of the
UsTy provided by the Legislature for lis pro
lection against any combinations that could be form
ed against it If they had resumed in the face o.
, this Law, and any misfortune, by whatever means
between any one Of the Branches, and the Bank pu
in liquidation by the Governor the responsibility
of the officers of the Bank and Branches to the lie
gislature and to the citizens Of the State woulC
have been much greater than they would Willingly
assume.
The Convention could not but feel the responsible
: ity imposed on them by law upon a question 81
intimately connected with the trade and business
= the country and the best interests of tie people
and more sensibly when they reflected on the hos
. tilty exhibited toward the Bank by a large nuute
: of our prominent and efficient politicians dur
ing the last session os the Legislature, whose infu
eDce combined with that of the stockholders in OF he
= Banks prevented the adoption of the most impor
r tart measure before the last Legislature for it
benefit and might and would probably have been use
for it's es ru,t on, under the strinl regulation
Of thelatelsws. While, therefore, they felt unlimite
) confidence in the ability of the Bank to meet its liza
9 bilties which viii be shown to the satisfaction
everybody in our July statement which will be pub
lishsd in few weeks, they felt it an Imperative du