The New Orleans daily Democrat. [volume] (New Orleans, La.) 1877-1880, 1877-02-07

which will be related hereafter, there
was but one ticket in the field, the fol-
lowing, which was elected by the un-
precedented vote Of sixteen thousand
Of stock. viz: r.. Brugier, E. L. Carriere,
y. A. Chaffraix, John G.. Gaines, RObt.
Hare, Thos. D. Miller and Henry Rem
shaw.
Last year, and this year again,
AN OPPOSITION
was gotten up against the directory,
who were plainly charged with bad
management Of tho institution. or, at
least, the burden Of the charge was laid
upon the shoulders of the President,
Mr.. John G. Gaines. The opposition
this year, after selecting ticket of
their own for directors OF the bank,
withdrew it on the eve OF the election,
which gave the result mentioned.
Although following and observing
with no little degree OF interest the
progress Of this great institution, tho
DEMOCRAT has studiously avoided tax
ing part in those phases Of itss develop,
| ment which partook OF family"
character, and it is only after @
PEACEABLE SETTLEMENT
of the dissentions that it is ventured to
treat the subject Of the condition of the
affairs of the bank from a point OF view
which must be of interest to the people
at large. meanwhile carefully avoiding,
as far as possible, all invidious illusions.
The opponents Of the present direc-
| tory Of the Citizens Bank had, it
seems, several abstract objections to
| It's management. The main PROPOSE
! ton. however, and which all others
| lead to, was the fact that for three or
| four years the bank has paid no divi-
dends to its stockholders, and it was
contemplated in the event OF the sue
cess of the opposition to liquidate the
affairs OF the mortgage department and
reorganize, so to say, the institution on
an entirely leash banking basis. ssan
Z X sSls@1f5SS AN EXAMINATION zs94 - ss...s
into the affairs of the bank shows that
to effect this obliteration OF the mort
gage department Of the bank not only
would involve the safety Of the cash
department, but would be most disas-
trous in its effects, particularly to the
| land owners in this State affected by
the mortgages held by the bank Tor
rather its bondholders,) and is that
operation might throw the entire pro-
ductive land interests in the State into
chaos.
Without going into the history OF the
bank. which is too complex, it may be
said briefly, for the information Of the
uninitiated, that there are now out
standing against the bank some four
millions of dollars Of bonds, indOrsed
by the State and held abroad. This
amount is all
SECURED ET MORTGAGE
notes on the plantations Of the sub
scribers to the capital stock, who,
owing to the war and other ex-
traneOus circumstances. have been
unable to meet their obligations. 1t
has, therefore, been the policy Of the
bank, under the cirCumstaw wgGs, to af-
ford the easiest terms to its debtors in
the settlement Of their mortgage notes,
and the correctness OF this policy can
find no better argument than in the fact
that recently tho European bOndhOid-
ers, acting with similar wisdom, have
consented to an extension OF the expired
term for the payment OF these bonds,
Of twenty-five years, conditioned that
the directors should call IN assessment
Of fifty cents annually per share on the
mortgage stock. A very large proper
ton Of the land thus affected is in full
and profitable cultivation, some as heir
looms, while another portion has
passed into the hands OF new proprie-
tors, who have only recently begun to
seo their way out Of their financial
troubles. It may, therefore, be imag-
iu8d
HOW DISASTHoUSLT
an opposite policy would result. Should
the bank at this period endeayor to
realize It's credits, the land would in all
pro liability not yield over ten per cent.
OF it's real value, and to throw such q
vast amount Of property on the market
4 SnfI 50 pF oo% ~
value Of all the lands in the State. But
this would be even secondary to the
utter ruin OF the mortgages and the
social dem oraliZation that would ensue.
It would, also, be ruinous to tho bank,
which would find itself in the i'm
possibility Of paying its debts, with
the amount to be realized by a
foreclosure Of the mortgages. This ap-
plies to what is called the Mortgage
Department Of the bank. This depart
ment is, however, SO closely allied to
the
"CAsH" DEPARTMENT,
that It is easy to understand how much
the credit Of the latter department
would be Immediately affected by such
an unwise course. First Of all, the
capital stock Of the institution is
| 81, SOC, 900, one third Of which belongs
to the mortgage department; it Is clear,
therefore, that that portion Of the CAPT
tai must be absorbed should tho sui
cidal policy alluded TO be followed.
Further on, the facts will show where
on depends the credit OF the cash
department, and how much it must
become affected by an unWise policy.
In 1874 tho Citizens Bank found itself
compelled to suspend payments, like
many other similar institutions in this
State and throughout the country. Qhe
men at the head Of the concern
| DID NOT FALTER,
however, hut on the contrary, owing to
the high character which they bore, the
wealth they represented, and the rich