Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1858-11-07

The Bank OF Tennessee
Under this caption the Columbia Herald gives
the following history Of the origin Of the Bank
Of Tennsssees
In the discussions that have taken place in regard
to the Bank Of Tennessee, We have observed
good deal Of error 70 the origin Of the institu-
ton Il was established by the Legislature in 1887
which was composed Of large majority Of Wings,
but it is not true that It advocated or opposed
as 8 Wing OF Democratic measure. The first pro-
position for the establishment Of State Bank was
made bv distinguished member Of the Wing par
tv Gov Neil s Brown but on its final passage it was
supported and opposed Unfortunately By Wings
and Democrats. The measure vas hrst brought
forward purely as 8 bank proposition, but in this
shape its passage was impossible 1t was next
brought forward by another distinguished Wing,
Maj Andrew L. Martin, in convention, with
system Of Internal Improvement aud Common
Schools, and IL this shape it finally became law
In 1887 the Union and Planters Banks were IN
state Of suspension They had come into or upon
the rising tide Of expansion in the currency pro-
dueed by the ex iIing struggle Of the United States
Bank The spirit Of speculation thus generated
demanded bank capital end bank secOmmoda-
lions The Union and Planters Bsnks spread
their calls te the breeze, discounted literally, ex>
tended abundant relief to debtors Of the United
States Bank, and contributed to the Specializing
mauia until the usual catastrophe Of such eXpan-
sions involved them IN suspension and the people IN
heavy embarrassment.
This was the state of things when the Legislature
of 1887 met, and il was as q relief measure to the
suffering people that the proposition for State
Rank was first made and urged The Union aud
Planters Banks were broken down, were in disre-
pute and their capacity ever to recover from their
crippled condition seriously doubted. As a
mere relief measure, however, the proposition had
but few friends. There was another party in the
Legislature, much stronger than the State Bank
party. which. adopted the State Bank proposition
and finally carried it through: this the Inter
nal Improvement party. headed by Andrew L. Mar
tin ESQ. one Of the ablest that ever sat In our
Legislature he was not in favor Of State Bank
as a mere relief measure, but he was willing to con-
neet the bank proposition with his favorite system
Of internal improvements, and 60 for the two as
parts Of one great State policy.
The state Of things then prevailing was highly
favorable to Mr. Martins project There was a
strong Internal Improvement feeling pervading the
State. Congress had recently passed the Deposit
Act, which placed in the Treasury Of Tennessee
nearly million and a half Of dollars. This deposit
our Constitution dedicated 70 the Internal In
proFements and Common Schools. The Common
School fund Of the State, amounting to nearly one
million Of dollars had been distributed through
the counties aud loaned until it evident that
the fund would soon be sQhaDdered that the poll
cy Of gathering it in and saving the wreck, was
rea lily adopted as wise suggestion. In this way
between two and three millions Of dollars Of the
School and Internal Improvements, were under the
control of the Legislature, aud it became import
ant question Rs TO the investment and management
Of the fund. The idea Of applying the fur d in he
establishment of State Bank, was strengthened by
the fact that the Union and Planters Banks had
then failed to meet the public favor, and had be
come involved in one common embarrassment with
the people
Aided BY this condition of affairs Mr. Mar
tin brought forward the Il TO establish a
State Bank, to raise fund for internal improve
ments and to aid in the establishment Of a system
education +" By some it was supported on ac-
count of its Internal Improvement provisions, and
by others on account of its bank provisions. But
its passage was in no proper indicative Of a
party measure, although majority Of the LegislaN
ture was decidedly in favor Of Wing doctrines.
The capital of the Bank to be five millions
Of dollars, made up Of the surplus revenue on de-
post with the State the school fund and the resi-
Que to be raised upon the bonds of the State. The
capital was fixed at Eve millions for several rea-
sons. FIRST, because by banking at that time it
was estimated that the amount of profits Weuld
enable the State to distribute annually one hundred
and eighteen thousand dollars 10 schools and pay
the interest on Internal Improvement funds to the
amount Of four million dollars that being the max
imum amount for which the State to issue In
ternal Improvement bonds. Second, because it was
intended that if the Union and Planters Banks
should continue to bank, the State Bank should
have capital enough tie control their operations and
policy. Third, because this amount Of capital was
deemed sufficient, if the TWO stock banks were
wound up, for all Commercial purp ses.
The charter Of the State Bank vas to expire on
the list Of January 1863 at which time it ex-
pected hat its affairs would be wound up and the
STATE be a condition, either 10 adopt another bank
charter or resort TO a specie currency, as circum-
stances might indicate as the best policy.
Such is brief statement Of the causes which
gave rise 10, add the means by which the State
Bank Of Tennessee was instituted.