Knoxville weekly chronicle. [volume] (Knoxville, Tenn.) 1870-1875, 1873-10-01
THE FINANCIAL SITUATION.
suspension OF the Exchange and De-
post, the Knoxville and the
Commercial Banks.
Confidence OF the Business Community
In the Banks mistaken.
The Alarm Confined chiefly TO small
DepOsIIora


The great financial wave which started t
in New York, has swept over the country
and whiIe'other cities have felt It's power,
until within the past few days Knoxville
has escaped the great maelstrom in which /
so :many stsunch financial houses have
been engulfed.
Saturday morning the announcement
Of the suspension OF the Exchange and
Deposit Bank, OF this city, caused ripple
in local financial circles, which gathered
force a few hours later when II became
known that the Knoxville Bank had ceas@
ed payn,ent, and eliminated early In the
AFTERNOON with the intelligence OF similar
action on the part OF the Commercial,
which made q gallant stand, paying out
Sl5, 900 in the forenoon.
The we'll known integrity Of the bank
ing officers, however, prevented panic as !
it is know that they are abundantly able
out of their personal means to make good |
all deposits ii their business should turn |
out disastrously, though Messrs. Baxter, |
| Van Glider and McClung all assert that
! they have not made reckless investment
and think they will not lose dollar.
! In the afternoon a CHRONICLE reporter
called on the different bank Presidents and
| obtained their views of the condition OF
affairs, which agree in essential points
and should have y tendency to restore pub
lie confidence.
COL. JNo. BAXTEb,
President of the Exchange and Deposit
Bank, expressed himself substantially in
his circular announcing his supervision. He
thought it would have been better for the
other banks which had suspended to
have done so when he did, as they would
have been enabled to resume payment
so much the sooner. His was not
total suspension and would not be, he
having paid out over fifteen hundred dol
, lars to depositors who needed the money
, for present use and were not Influenced by
, a panicky feeling, and he expected to be
/ able to make collections with sufficient
promptness to continue to do so. He mad
paid out during the day special deposit OF
800 in gold which had been in the bank
: eight years. The present stringency had
n commenced, really, before Jay Cookies
failure the tendency having been to avoid
making deposits. His bank was perfectly
good for every dollar Of its Indebtedness,
and he regarded every other bank in the
y city as equally solvent, all that they wanted
It being the indulgence OF depositors Tor q
= short time. ....... ....
IS R. NJ. M'cLUNG, ESQ,
II President of the Commercial Bank, sale
n that there was really no occasion for any
Al excitement. The trouble was owing alto
gether to want of confidence on the par
70 OF depositors, who drew out their none!
| to hold, when they lau no 1nlueulate us
IN for the samo. He had the most salts
IL factory assurance that their collections
l. would be promptly met. During October
DR. he had paper to the value OF $50, 1000, which
:, would mature, and he had no doubt, bu
II that every cent would be paid, The Com
~ mercial had to bear the brunt and made
OF good stand, paying out SIS, 900 during tn
81 morning, but owing to the suspension G
ps the two other banks they had to yield t
n, the pressure. He hoped to resume pay
IS, ment in ten days. Their suspension wa
es only partial, as they had been paying sma
r sums to relieve pressing wants and Toul
III continue to do so. r...
y MR. JNO. s. vAN.GILDER,
g President of the Knoxville Bank, was O
of the bank all day, and gave his reasons fc
,ir the course pursued by him. The sudden
ness of the storm was bewildering in II
~ power, and owing to the alarm of some {
n. its depositors, coupled with the gradus
"a withdrawal of funds from the legitimat
n. channels Of trade, the volume OF currenc
"a in circulation was not sufficient to NEE
the demands of business, as 1t was not
oe use, but kept locked up in the safes an
&c pockets Of the people, who had no use &c
No. IL, but were mOrtally afraid OF losing it
be left in the banks. Business had almost II
an covered from the effects of the cholera, bl
NV the needless panic would have tendenc
% to cause a lull for several weeks. Thel
tn was really more money in the couI
n try now than ever before. Knoxville d.
no. positors would lose nothing by the SUI
pension OF the banks, beyond Temporal
Inconvenience. He had individual prof.
erty sufficient to guarantee the payment ,
tie every depositor, and would satisi
any one of the fact. The following circuls
in was issued announcing the suspension
. the bank: 1E. E|
n; KNOXVILLE, TENN, Sept. p, 1873.
To the DcpositoTs of the Knoxville Bank :
in In order to preserve the assets OF III
Bank from sacrifice during the preseI
n panic, it has been determined this NOR
ing to suspend for short time until bus
in ness can be resumed. rr..f :,
The bank has not lost a dollar nor suite
act ed any sacrifice by reason of the panic
far as known. 1t is amply solvent and
of its liabilities will be met.
In addition to bank assets, the unde
ces signed will hold every individual resour
in the city or county to discharge any ban
IN, liability and desires to secure any such |
on. any private arrangement that may
agreed upon. r..
The small depositors will be paid by u
undersigned in short time, from indivi
ual resources, in currency, and the safe
es. of the public funds shall not be endange
ed. .-..... .. ...
1t is hoped that this temporary suspe
sion will not be of long duration.
Very respectfully,
- Dec L.,