Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1866-01-10
National HANKS.

dishonest knaves.
NATIONAL BANKS.
A communication was received, some
days ago, from a correspondent in Car
rollton. Miss, asking some questions
about the soundness Of the National
Banks. The interrogatories were an
swered at the time, and, 1t IS hoped, in q
satisfactory manner. The question,
however. is one Of such magnitude, and
involves, so generally, the entire cycle
Of industrial interests, that a fuller treat
ment. il is thought, would be acceptable
II is proposed, therefore, in the present
article, to canvass thesystem upon which
the Banks are founded, reveal their con-
stitutional features, and furnish all the
facts essential to the reader in the forma.
ten Of his opinion.
The creation of National Banks is de
rived from a law Of Congress, approved
in June, eighteen hundred and sixty.
four, and entitled the National Currency
Act. The first section Of the act estab,
fishes a separate bureau in the Treasury
Department, at the head Of which AZ
officer presides, who is denominated the
Comptroller of the Currency. The sole
Office Of that functionsry is 10 supervise
the conduct Of the Ranks, i~naugurated
under this law, to see that they do not
trausgress the regulations imposed upon
them, and 10 visit upon them, if they
do, the penalties prescribed.
Section five ordains that all associa-
tons under the act shall be composed OF
not less than five persons. Those thus
acting, shall make an organization eertif-
cate, which shall speciy-First: The
name assumed by such association,
which shall be subject to the approval #
the Comptroller. Second: The place
where its operations shall be conducted.
Third: The amount Of its capital stock,
and the number of shares in which the
same shall be divided. Fourth: The
names and places Of residence Of the
shareholders, and the number of shares
held by each. The certificate shall be
acknowledged before a Judge, OF Notary
Public, and sent, duly authenticated, to
the Comptroller, who shall place the
same OF record.
In a town whose population is not over
six thousand, an association may be or
gsnized under this act with a capital Of
not less than fifty thousand dollars. 9th
erwise, the minimum is not under one
hundred thousand dollars, and in q city
with a population exceeding fifty thou
sand persons, the capital cannot be less
than two hundred thousand dollars.
The natural duration Of such associa-
tons shall be twenty years. They may
be sooner dissolved, either by a forfeit Of
franchise or the voluntary action Of
shareholders.
The affairs Of every association must
be managed by at least five Directors,
one Of whom shall be the President.
Each Director shall possess, in his own
right, at least ten shares Of the capital
stock, and declare, on oath, that said
shares are not pledged, or in anywise by
pothecated for any debt or loan. Should
he cease at any time to own the requisite
amount Of stock, he shall thereby vacate
his Office as Director.
Capital stock shall be divided into
shares Of ole hundred dollars, and be
deemed As personal property. Every
shareholder shall be held individually
responsible, equally and ratably, and not
u for another, in all contracts, debts,
and engagements of his association, TO
the amount Of his stock at its par Udlle.
Banks may increase their capital from
time 10 time. The maximum Of such
increase shall he determined by the
ComptroIlerm the articles Of association,
and no increase shall be valid until the
whole amount OF such increase shall be
paid in. and notice thereof transmitted
to the Comptroller, and his approval re-
ceived. Theymay also reduce their capt.
tai. but never below the amount required
by the Currency Act for their outstand-
ing circulation, nor until the proposed
reduction shall have been submitted 10
The Comptroller, and obtained his Use.
At least fifteen per cent of the capital
stock shaIl be paid in before business can
commence, and the remainder Of such
capital must be paid in instalments Of
ten per cent. each, on the whole amount
of the capital, as frequently as n install
ment each month, from the time the
Comptroller shall authorize the COM
OF business.
Before its inauguration, every associa-
ton shall transfer and deliver TO the
Treasurer of the United States registered
bonds Of the United States, bearing inter
est. to an amount not less than One-third
of the capital stock paid in. This pro-
portion is 20 be vigorously enforced, 50
that in whatever act, either OF expansion
or reduction, the banks viii be required
10 have always on hand bonds 10 the ex-
tent Of one-third Of the stock actually
paid in.
The bonds thus deposited shall be held
the Treasurer Of the United States
for the associations delivering them, and
no transfer Of such bonds by the Treasu-
-er shall be valid until the transfer is
countersigned by the Comptroller Of the
Currency. The latter must keep a strict
Of all such transfers, and give
prompt advice Of the ssme 70 the associ-
from whom the bonds transferred,
originated.
Upon delivery 70 the Treasurer Of the
required amount, and character Of bonds, I
the bank 50 delivering, shall receive from
the Comptroller, circulating notes ZEN
graved under his directiOn) Of different
denominations, in blank, registered and
countersigned by himself and the Treas
urer. The amount in notes thus issued
shall not e1ceed ninety per cent. Of the
amount Of the bonds deposited, at the
Dar value thereof, if bearing interest az
he rate Of five per cent per annum; and
no case shall the sum Of such notes
ssued 10 u association exceed the
amount Of its capital stock actually paid
n.
EUcl uDLte AklEA nahAnA ttA PADENAs
by the President, and Cashier Of
he Bank to whom they are given, shall
received at par everywhere inthe Uni
ted States, in payment Of taxes, excuses,
lands, and all other dues 10 Government
except duties on imports; and also for all
andother debts owingbythe Uni-
ted StatestO creditors within its territory,
interest on the public debt and in
redemption Of the national currency.
These notes, If worn, OF mutilated, shall
be received by the Comptroller, and if
destroyed, he shall upon proof OF destruc-
lion. replace 10 the Bank tOghom they he
biank notes Of an equal amount +;
Whenever the market value Of any Z
Bonds. deposited under this act with the
of the United STATS, shall be
-adhseed in value below the amoun Of
.ireulstion issued for the same, the Comp
is empowered to demand from the
. s.~oeiation which deposited them, the
,,,ount Of sncn depreciation, in other
Tnited states bonds, at cash value.
THE loans Of Banks under this act
of no time exceed one-tenthO of the
Of the capital stock paid This