The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1859-11-01

UauAauB CVt"PosA1o IL ONO OF TWO m0nnorS-Dy
individual BANKERS solitary millionaire or copart
nership under banking title, Or by articles Of az.
ISOLATION. sgned by subscribers and limited to the
purposes of banking as interpreted by the statute.
This last basis Is almost universally preferred in
establishing city bank. rs much from difficulty in
hunting up persons willing to contribute in copart
nership capital requisite for profitable invest
ment in this metropolis, where banking. like every
other channel Of trade, is oyeriiowed through COM
petition. as from the facility with which certificates
OF shares can be hypothetical or sold at tho Board
OF Brokers; for stock Of reputable banking insti-
tuition u . mercantile commodity, and therein mo-
neys thus invested essentially differ from copart-
nership interests in individual banks.
A knot Of aspiring gentlemen having determined,
from motives of either ambition, self interest or
speculation, to create Q new banking institution.
first secure collection of names Sufficiently
.'strong" in a commercial point of view to engender
confidence as to security for investment among the
general mass Of small capitalists. such as well to do
artisans, widows with tolerable means, and peo-
pie with limited resources, gene rally unengaged in
trading pursuits and then opens books for sabscrp
ton to the capital stock OF a proposed bank, with
an ipgeniousy euphonious appellation As nest
egg, or rather bait Of toasted cheese, they choose
for their president some meritorious or otherwise
recognizable merchant, trader or man ufactgrer,
whose reputation forms the keystone to the pro-
posed edfce, who, in appreciation of the conferred
dignity, pledges himself as responsible for large
amount of the capital, probably about one-sixth.
In the selection of this important parsonage, the
bank builders are governed in no respect by con-
sderations to bis banking capabilities for bank
president, like him Of our Union, is ever to be en-
circled within a cabinet of sagacious worthless,
while his ignorance to finance is rectifed by the
transcendent wisdom Of a cashier, an exteler from
some popular institution, who, from having grown
gray amid money bags, is presumed to have mas
tered all imaginable monetary intrcaces The chief
requirements as to presidential eligibility are ge
morally determined to be the possession ofwealth,
OF commercial credit and of a sound, orthodox
semiclerical notoriety and should he prove to be
mission trustee, tract society treasurer or, other
wise to flourish in public and cody capacity, he
will find greater favor in the sight of the children
of Mammon as comforting sanity halo around dis
count and deposit.
To the master spirit should be copjoined vice
president, man of influence among brokers' whose
name is household word in "the street." shrewd,
practical fellow knowing thing or two, whose re-
ligion is of no account provided he eschews drink
ing in public and owns oily tongue, as his Office
compels him to drum up accounts, to negotiate
sharp loans, and do "ohoresn generally outside,
while the omnipotent, omniscient cashier "talks
turkey" within doors. To attain this position the
vice president contributes his proportion towards
the captal and subscribes for one-half the sum al
lotted to the presiding functionary.
1.la SpfA fytrIuN
body, with equally cautious considerations as to
their individual availability; for upon their personal
reputation public notoriety, depends the saliva
ton Of the ark about to be committed to turbid
waters. As matter Of precaution they choose
each from different business paths, for ancient
adages rightly inform US that two Of trade
never agree, and that variety constitutes the
spice of life. Moreover, the merits OF direc-
| tor depend amazingly upon the locality
surrounding the proposed concern, and the quality
| of the patronage to be solicited; for man con-
| ceved to be trump IN one quarter, among par
tcu!ar trading class, would prove wet blanket IN
vertheless there are sundry individuals, exponents
of specalites among dealers, who are in constant
| demand for bank directing purposes, such, for In
| stance as q leather dresser, sound on Swamp pa
per- wholesale hardware man with extensive
Western correspondence, liquor dealer with re.
| hgious turn Of mind, or shipping merchant not
wanting TO borrow more than half the capital, and
divers others of similar and especial mercantile
repute But in these latter times, when banks with
their insurance appendices emulate patent medi-
cine vendors in business competition. almost any
aspiring genius can become director with ready
money to iquidate his quota towards bank crea-
ton.
To illustrate in familiar manner the method
employed to fill up the subscription books, let us
suppose the projected bank to require capital Of
| 5000 600 in 5000 shares of 500 each. The en-
bryo concern boasts twenty directors, qualifying
their position by subscription of fifty shares each,
| TO which estimate TO be added the shares for
which the president vice president and cashier are
held responsible, personally or through friends. to
secure tenure of office, and there remains an APP
paling balance to be subscribed for to cover which
the directors tax their ingenuity aud resort to de-
vices which would appear ludicrous did they not
smack Of Peter Funk charlatanry.
In the first place, well knowing bank clerks to be
ever expectant OF promotion, difficult to be OBJ
tanned in institutions to which they are for the
moment attached rs changes therein rarely occur
unless through death or resignation, the directors
coyertly advertise the chances of a superior desk
to young men, inducing friends to subscribe on
their behalf to given amount As there are some
six to eight openings in new bank IL Is sagaciousy
estimated that the successful competitors for teller
and clerk ahips can be regarded as reliable for al
least $50 shares. appOrtioned among them according
TO respective salaries and to such an ncredulous
trayagance has been this banking smony exacted
that few years since the position of notary, ever
point of competition, but which in new estab.
ishment fails to realize above 5000 annually, was
secured solely through stock subscription OF
10000 While the influence of subordinate off
Gals is thus severely taxed, the directors are sim
pl, expected to furnish additional subscriptions to
amount equal to that required for their ndividu
al qualification. Now, let as see how the capital
stands after exhaustng the endeavors of those per
sonally interested in the enterprise:-
20 directors go shares each) ........ 800 600
Friends of eighteen directors. ......... 10000
| President and friends Observation-Disclosures. $4,000
! Vice president and friends. .............. $4,000
Cashier and friends Observation-Disclosures. % ,000
Clerks, notary and friends. ............. $4,000
Attorney and counsel. .................. 10000
Total Observation-Disclosures. $500 900
And here we have deficit of 5000 900 to be
raised among the community in the best manner
possible, and to be paid in before the association
can claim membership in the Clearing House. Now
comes the low comedy Of the transaction. Tou
ters" or brokers professionally trained for the bu-
siness, are paid liberal commissions to entice new
subscribers and vaunt the praises of the proposed
establishment with energies rivalling the energetic
declaration of Balaam and the re-echoes Of bis