Nashville patriot. [volume] (Nashville, Tenn.) 1858-1860, 1858-07-06

cnHe resumption Vi specie pay HeHls ioI lnt
present:
BANK OF TENNESSEE, June &c. 1858.
DEAR SRs:-I received yours of the 22d. in
quiring of me the reasons why the Conven.
| ton 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 reply. | have the
honor to state that on the 2Sth of January
last the General Assembly passed an act. i'm
posing important rules and severe restrictions
for the future management of the Banks in
this State which were believed to be necessary
TO protect the citizens against the contractiOns
and expansions of the Stock Banks, which
were 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 charter OF
the Bank. Second. no contract made by such
Bank could be enforced at law or in equity.
Third, the officers of the Bank were made IL
able to indictment, and heavy fines imposed
for the transaction of any business after a
violation of any of the restrictions Fourth,
it was made the duty of the Governor to pro-
| coed Immediately against any Bank violating
the restrictions, and their assets to be placed
in the hands Of trustees for their liquidation.
! The Bank of Tennessee, being under the alb
solute control of the Legislature, was bound
| by these restrictions and liable to the penal
| ties for violation of the law, thus placing
| all the Banks of the State upon footing of
! equality in the transaction of business and
| subjected to the same penalties for violation
of the duties imposed upon them. The Lee
lature, arning that many OF the Stock Banks
as well as Free Banks. would not probably ac-
| cept the provisions of the law az to a part of
| their charters. and that they set up a claim of
vested rights" and that the questicl would
| have to be settled in the Courts, determined
| not to give them such advantages over the
| BOnk of Tennessee las they would have should
their claim of rested rights be sustained by the
| Courts, and passed another law on the 18th
! of March, giving them three months to
accept the provisions, and at the same
time, for the protection of the Bank
| of Tennessee, directed that it should not
be compelled to resume specie payments ''tGntI
:" The Union and Planters Banks shall file Their
" acceptance Of tie provisions of This act and the
one of January, ''and if they do not accept tie
d" the provisions Of sad acts me day Of RESUMPTION
:" shall be left TO The discretion Of the President and
g Directors" Early in June, the stockholders
in both those Banks had meeting in Nash
vile and resolred not to accept the provisions
of the two acts as part of their charters, claim
ing the right to do business under their old
charters as formerly, and mainly, as it is I'M
derstood, because of the severity of the penal
ties imposed by those laws
Under such circumstances. the Convention
on the 18th of June. They were fully advis-
ed of the proceedings of the stockholders of
the Union and Planters Banks, and could not
fail to see the great advantages the other
Banks, acting under their old charters, would
have over the Bank of Tennessee, acting un-
der the new laws.
The uanger, which the Legislature appre-
hended. and which was well understood by the
Convention, consisted in the fact that the
70 felt tn
keep up a circulation of near two to one for
its gold, so as to protect the people against
the contraction and expansions of the other
tanks and in the event of resumption, a
combination of the other Banks. or even a
small portion of them, might force some of
the branches to stop specie payments second
time, which, under the new laws, would be Il
forfeiture of its charter and the right to col
lect its debts and its assets, and placed il in the
hands of Trustees for its liquida ion. Such a
combination, the Convention saw, could only
be resisted by curtailment of the circulation
of the Bank and Branches so as to have
gold dollar in their vaults for every paper
dollar in circulation, which must necessarily
add To the stringt ncy of the money market,
and impose such new burthens upon the
people. and prev mt the pc sibility of its max
ing the usual dividends for the State, so much
needed at this time, for the payment of inter-
est on the State debt.
If the stockholders Of the Union aud Plant
ers' Banks declined accepting the provisions
of the new laws, on account of the heavy pc
nalties imposed for IA violation of Them why
should not the officers of the Bank of Ten
nessee avail themselves of the rery mems pro-
yided by the Legislature for IFS protection against
any combinations that could be formed against
it? II they had resumed in the face of this
law, and any misfortune, by whatever means.
between any one of the Branches, and the
Bank put in liquidation by the Governor, the
responsibility of the officers of the Bank and
Branches, to the Legislature and to the citi-
zens of the State, would have been much
greater than they would willingly assume.
The Convention could not but feel the re-
sponsibilty imposed on them by the law upon
u question so intimately connected with the
trade and business of the country and the best
interests of the people, and more sensibly
when they reflected on the hostility exhibited
toward the Bank by large number OF our
prominent and most efficient politicians during
the last session of the Legislature, whose in
duence combined with that of the stockholders
in other Banks, prevented the adoption of the
most important measure before the last Legis-
ature for its benefit, and might and would
probably have been used for its destruction,
under the stringent regulations of the laws.
While therefore, they felt unlimited confidence
in the ability Of the Bank TO meet its liabili-
everybody in our July statement, which will
he published in few weeks, they felt il an inn
perative duty TO the State and the people, to
do no act which might in any way endanger
the existence of the Bank, or limit its means
to serve the people, and therefore resorted 10
The mans provided by the Legislature for its
protection.
You further inquire of me. at what time
may the people expect resumption In re-
t,lv have Ia state that more thuu two months
ago the Branches were instructed 10 pay coin
upon all legitimate demands of the citizens
for business purposes guarding against money
dealers aud brokers who wished the use OK
coin for the purpose of speculation. whilst the
principal Bank at Nashville has furnished the
people large sums in exchange at only half
per cent. premium. which i utrtsai resumption
In the estimation of every business man.
The same course will be hereafter pursued.
only adding To the list of those not authorized
to take their gold-the noa-doc31tng Banks.
The Bank will pursue the same course as here
tofore not enlar ging its circulation for the pur
pos,s OF speculation, but keep it in he althy.
sound condition. and give every possible aid
To the trade and business of the country
The period of resumption WILL in a great de-
gree, depend upon the operation OF the late
laws upon the business OF the other Banks. and
the influence which the efforts to repeal IN,
charters may have upon it. / can assure YOU
that no one is more anxious than the present
Board of Directors "a have the business of the
Bank placed upon legitimate and proper
footing, soon il can be done without
danger TO the institution 10y the combination If
other interests against IT,
lam, respectfully, your friend,
c JOHNSON.
Hons W C DrSIAr and Z ". NJ Eps, Memphis.