New Orleans daily crescent. [volume] ([New Orleans, La.]) 1851-1866, 1861-12-20
II of specie IA nents, win no doubt be presented to
the General Aesemblyin the message Of his Excel


wishing and exaetng strict observance of the laws
Regulating and controlling the banks, with no dis
erationary powers, except the right TO adopt such
of the LAM, this Board could not hesitate in decide
1 ing to perform the duty which the law e1joined
/ upon them. To have been controlled or delayed
/ in our action by the plea Of = necessity and expe-
dency,9 when the organic law Of the State with
! holds, even from the Legislature, the power to
/ authorize suspension of specie payments, would
4 have been to ignore the obligations imposed upon
ns by our oaths Of office. NJ tribunal is designated
the law with the power or authority to grant US
All meeting of this Board, held on the 2sth of
september, twas unanimously determined to pro-
}seeed IS the law required. q
Nosiceswere accordingly served upon the banks
operating under the act of 1642 to wind up their
affairs, By the President Of the Board on the 2sth
day Of September, and on the expiration of the
twenty days allowed by the law within which those
banks were TO comply with tile order. The Attor-
ney- General Mas informed of the action of the
Boafd, by our President. 9 5sB
The delay in the action of the Board of, Currency
was caused by the absence of its President at the
time the banks suspended specie payment. The
provides another mode and deyolyes upon one Of
THE State officers the duty Of winding up their
Affairs when they violate the law. s - lsss M
In the report Of the Board last year to- The Legis
lature your attention was called to thesfact that
that the provisions Of the law requiring all ninety
days paper to be paid in full at maturity, was not
enforced by the banks, as follows: q u sSs' Z
The first fundamental rule Of the Bank Act Of
ls42 prescribes that the loans on deposits and
specie, representing the paper money issued by
the banks ahaH be restricted to paper payable in
full at maturity md within ninety days. So also
does the 26th section Of the general free banking
Law require that the cash liabilities other than cir
Eculation, and not covered by specie, shall be re.
| presented by bills Of exchange or discounted
paper, maturing within ninety days and not renew
able In times Of severe pressure, like the present.
this requirement. becomes in q great measure In.
operative, as the utter inability Of many parties to
full at maturity renders it necessary for the
protection OF all interests to grant partial re-
newals. 81 g.& M t3- ts!s 80 515.s3 81
E We are Of the opinion that a very small amount,
e ninety aays due the banks
months. IL was intended BY this provision Of the
law to secure the holders OF bank notes against the
Possibility of loss but the experience Of the last
Twelve months has demonstrated the utter ineffi-
cheney Of commercial paper, in times 8of severe
pressure like the present, as q security for the
prompt redemption of the circulation Of our banks
We also feel is TO be ourdnty to state thatthe laws
requiring the banks to exchange daily with each
other their respective notes. has not besn respected
by some of the banks since the suspension OF specie
payments. The policy of this provision is very
obvious, and its strict observance very important.
IAN erroneous opinion II entertained by many as
no power to enforce either the law or the obsery-
ance by the banks of the rules which we may
adopt to Insure faithful performance Of their o.
legations. a ssy 8;E 4, s l+s 4,
When we have called the attention of the AL,
torney General to the Illegal acts Of the banks We
have done all the law requires of US, and it rests
entirely with that officer to enforce the penalties
Inflicted by the violated laws. If the law was
amended so as to infhet d heavy peeuniary penalty
10 be given to some public charity for the viola
ton refusal to observe the rules adopted BY tie
Board of Currency to carry ont the laW regulating
the exchanges between the banks and the forms
required IN making their reports, with the power
CONFER ed upon the President to employ counsel at
the expense Of the bank prosecuted, If judgment
should be obtained and of bis own If not, it would
add greatly to The efficiency of the Board of Cor
fercy in protecting the banks Of small capital and
preventing the !. paper money issued under the
authority of the State Y from being deprecated.
Il The Board of Currency. with the limited powers
conferred upon them by the law, are useless in
eumbrance-an expense without any correspond
ing benefit to THE public. They have the power to
make rules but none to enforce them; they are
commanded to take care that the banks comply
strictly with the lars governing them, but we have
no power TO- enforce the penalties which the law
infet. In time Of general prosperity, with bounti
full crops and full prices for our agricultural pro-
Fductions there is little or no danger to be appre-
hended from an over-issue by the banks, because
the demands for loans and discounts are mnch less
than the banks are willing, able and anxious to
grant. This was the case during the years 1858
and 1859. But, when our crops fail, and panic
occurs in the money market, those patrons Of the
banks who deal and speculate upon borrowed
capital unable to take up their notes. the banks
refuse all applications for loans, and finally add to
the genera! distress BY snspending specie pay
ments. This was the course of some Of our banks
in 1857. ntimes like those, if the enforcement Of
the law was within the control Of the Board of
Currency, much might be done to protect the pub
Lie interest; but the Board is now constituted
Eit is powerless for good, and might as well be
abolished. ~ 49, m n 80
e. We beg leave, in conclusion, to refer the General
Assembly to the annexed quarterly abstracts of
the condition Of the banks and also to the detailed
statement Of their condition as exhibited BY the
returns of the l6thinst. g51
n. A. HUNTER,
Fl. y Z 85.. President Board Of Currency
Iconcur in the above report except that portion
asking for further powers to be conferred upon the
Board. Being Of the opinion that the responsible
y of proceeding against the banks for violation of
law should rest where it is, that Is to say with the
Attorney General. .9S {
.s p. D. HARDY, Secretary of State
The State Treasurer, not concurring Ii, this re-
port, refused to attach his signature thereto.
sR.SA. HUNTER, P. B. G.
"a "a +.