The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1867-11-07
Two Notable Bank Failures.

IRON he ". Y. Times.
The simultaneous failure of two British
banking institutons-the "Royal" of Liver
pool and the Commercial" of Canada-illus-
trate anew the perfect recklessness of the
management which characterizes banks which
have had an established repute for many
years.
The persons intrusted with the entire
management of the "Commerciar' of recent
years, owned among the whole of them less
than two per cent. of the whole stock, amount
ing to four millions. They were mainly what
might be called financial "shysters," " aud held
their position either as creatures and members
of the local Government, as public or private
trustees, or as the tools of railway spectators
and contractors, who desired to use the bank
funds for purposes alien to legitimate bank
business.
The spectators include the most notoriously
corrupt men in the province-originally the
agents and pensioners of Messrs. Peto & jack
son, of London-the latter in turn having
become their dupes and victims. The vast
majority of the stockholders of the Conner
cial, " it turns out from the published list, are
either widows and minors, or trustees for the
Communication clergy funds of the English and
Scotch Colonial Churches. The latter are not
likely to realize five per cent. on the invest
ment. The nominal sums held as stock by
the railway operators were all invested with
the view of getting control of the bank manage
ment; the proxies of fve-sixths of the sub
scribers having got into their hands through
the double influence of politicians and 'con-
tracing capitalists"
So far as appears now, there is no worse
bank kfailure-cOnsidering the amount of its
capital-on record. The "Western," " of Scot
land, had a much larger capital when it went
IyrA AI,oh hnar d9iNr nr aTn RtIt
| stockholders were of class that could better
| afford TO lose their investment than the hun
| dreds of poor people who have trusted to the
rogues that controlled this provincial concern.
| The failure in this case was doubtless caused,
| in great measure, by the rapaoity of the new
| Government banking concern-which, like the
| old Bank of Upper Canada and the CONNER
cial Bank, is fast being turned into mere
Government machine, to be used, just as the
| others weTe in the interest of o clique of rail-
| way men and politicians
The Royal Bank of Liverpool was sound
and healthy institution until it took up the
business of making special advances after the
manner of Overend, Guney x Co.'s Bank,
The "Royal" had, until within year ago, as
good repute for doing a safe and legtimat
business as any bank in the United Kingdom.
II began first to dabble in the shipping busi-
ness; taking mortgages instead of commercial
paper, and getting deeper and deeper into this
line until, as the London Ddiig Net0s informs
us, 1t came to own 10000 tons in ships. 1t
then went by natural and easy grade from
shipping to make advances upon peculative
purchases of cotton. The descent was, per-
haps, even more rapid than the failures we
have noted.
We might look nearer home, doubtless, for
other serious examples in speculative bank
ing. But most of our banks are worked on 30
much smaller a scale, that they do not invite
the same notice ~ these gigantic failures