The Russellville Democrat., 1876-04-13

the issuing of post notes was en
 tirely unauthorized by, if not 1T
 direct contraventioA of law. E,
 another act passed December 15th
 the legislature attempted te ex
 tend still further the supposed
 advantages of the system by au
 thor:zing the establishment of $
 branch at the Post of Arkansas.
 On the 12th of January, 1S3S, the
 branch at Fayetteville commenced
 discounting. And on the same
 day Mir. Brodie, one of the direct. ors, submitted the following reso-
 lution which was unanimously adopted;
 As the directors of this bank do not receive any compensation for their attentions, and as they necessarily cxpend much time, labor and money in the manage mcnt of said bank, it is therefore resolved, that the cashier be au. thorized, and he is hereby in- structed to loan to the said directors, or any one of them, at the usual rate of interest, on the presentation of a note with two securities, either of which is supposed to possess ample means to meet the demand, payable twelve months after date, for any sum not exceeding the amount contemplated in the charter, to- wit: The sum of ten thousand dollars. The loan to be made in the usual issue, that is to say, in post notes payable twelve months after date, with a due proportion of such money as may be made payable on demand. And be it further resolved, That said direct ors, or either of them, after having drawn money as aforesaid, shall have the privilege of renewing their notes as they become due, until it shall become necessary for the bank to call in all it's debts, and no one shall be permitted to borrow an additional sum after having drawn as aforesaid, until all the former demands shall have been satisfied; but nothing in the preceding resolution shall be so as to authorize the cash fer to loan to any director an amount exceeding two thousand dollars, without the consent of the directory at q regular discount day"
 Commenting on this libcrality to themselves, Messrs. Gougc and Rutherford, in their report to Gov srnor Conway, said:
 "When it is considered that up to January, 1889, Ga year after the date of this resolution) this branch was operoting on a bare capital of $ll0,000, the directors must be regarded as acting toward themselves with great liberality,
 as they resolved to lend ,o themselves permanently the sum of $90,000. They also acted
 literally towards others, as it is shown by their books, that they discounted nearly all the notes that were offered"
 The writer here extracts largely from the report of the same gen.
 leman, which will give a clearer dea of the manner in which the bank was managed, than any hing he could say:
 "On the 9th of February, the branch at Batesville commenced liscounting. Thus, iE the early sart of 1888. the mother bank and ,wo of its branches were in opera ion, and all on a capital of little nore than $400,00O, a great part ,f which capital consisted origin lily of the inconvcrtiblc paper of he banks of the neighboring States. In June and July the oans and discounts of the bank md it's two branches amounted to S6S9, 264, the circulation, payable ,n demand to $7,7S5, and the post ,otes payable twelve months after late, to $241, ,943. The specie on land amounted to $24l 1923. The most of the notes discounted had tight months to run. Specie bore ! premium as high, at times, as en to fifteen per cent, when esti- mated in the post notes of the bank which constituted the chief part of the currency. Not long liter this, August 27, IS3S,) ponds to the amount of one mil ion dollars were sold to tho North Trust and Banking at New York, on such erms as placed $30f,000 imme- liatcly at the. command of the ,ank and its branches. The resi-. lue, with an allowance for inter- st, was payable in monthly in
 tallmcnts, commencing with the irst day of January, 1889, and 'nding with the first day of Feb
 uary, lS46. According to
 of November 5th, 1858, he capital stock of the principal ,ank at Little Rock and the at Fayetteville ana 3atesville, then paid up, amount d to $l, ,363, l05-29; the leans and discounts to $963,737 ,22; the real state to $l0,743.53, and the spo- lie on hand to $3l5,045.76.