Ellsworth American. [volume] (Ellsworth, Me.) 1855-current, 1878-10-10


Relative to the failure OF bank City ~
Glasgow the London 7YBses of Oct. 81.
says: 9
The CITY OF Glasgow Bank hal 1888
branches. IL has paid progressively in-
creasinx dividend for several years past. until
II reached u per CEN. II would D. incorrect
10 say that the disaster was uneXI-, II. On the
contrary, 10 banking circles, II creaa 4 no sur
prise for the bank had been losing ere grsdu-
ally for ten years past. Yet the Scotch banks
10 London were not In possession OF iniurms-
tton " hich showed tina, the end vas actually
near until Tuesday morning. Rumors Of the
bank being Ia difficulties hxd been so often cir
culated before, within striekiy banking circles.
that the repttition Of them did not excite par
ticglsr interest on this occasion. The business
Of the bank had been conducted for years up
on very unsound principles. aud, from the
fact Of the other Scotch banks having decided
10 let the bank stop, 1t Is inferred that it {.
a very bad case. Operations upon an onor-
nous scale had been indirectly entered into
In Indian produoe aud Australian wool, some
e. so 0Oo Of bills having been accepted for the
had been made TO firms In the iron trade in the
North. and utterly reckless support appears to
have beeu given to builders.
The immediate cause OF the failure was the
impossibiliiy OF any longer 1ctti ng bills drawn
frOia India on the bank In glasgow discounted
In the London market. . circumstance which
explains, to some extent, the .cyeri-h oscllla-
tons for soma months past In the rates de-
msnded for loans. These bills had been sold
In India to Indian banks. o.iensibly against the
shipme Mt OF produce, and ultimately came up
on the discount market The terms dcma ndeS!
for negotiating them having stead advanced
instructions were at length, tnlegr Aphed 10 In
dian brAnche. TO take no moe bills, and a
soon 80 II was no longer possible to keep the
| open credit system going and the paper sfoat
the bank closed its doors.
- The liabilities Of the bank are estimated .,
ESQ .0so ,nO; the acccntsnee. slightly below
1900 .0oo the deposits 100000. The IN.
| limited liability OF The shareholder. may, per.
haps s.surc the depositors. The authorized
note circulation was only E1e ono. but accord
ing TO last accounts the issue 10 between $500
| 90 aud 40 .pn. against nearly all 81 which
| the Law comp-ls the bank to have gold. We
| believe We are correct In saying that this de-
| plorable catastrophe is, with reference Ia
I Scotch banks whole entirely an exccp-
/ ton. and that no other banking institution In
! Scotland 10 in any way mixed up with the
| cty.of GlasgUw Hank, ~ has been engaged In
| business Of the Kind which lc, TO th. failure
Attempts have been made In the city 70
/ oomplicste matters BY saying that there wa.
panic; bat there has been no panic The
/ Bank Of Eng and il In an exceptionally strong
| position relatively to the extent OF the bust
/ cess going on. and the STATE Of affairs Is very
different to what 1t would have been hal Ii,
| ds. AsteT happened to a bank whose souudne.s
/ had been above suspicion"
The FIAdRcisT anticipates no additional
I bank failures, but u says that some IncTCan,
1 tile failure, can hardly De avoided. which may
extend into the iron districts OF the North Of
/ England.