The true northerner. [volume] (Paw Paw, Mich.) 1855-1920, 1878-01-18
THE GREAT HEMICAL BANK.
A Remarkable New York Institution
Annual Dividends of 100 Per Cent.

n hemhrkaDie New NOrk lnstftution--
Annual Dividends of 100 Per Cent.
The New York World, in chronicling
the death of John Quentin Jones, Pres
ident of the Chemical Bank, of that city,
gives the following history of the sound
est financial institution in the United
States:
In 1888 "The Chemical Manufacture
ing Company" was Incorporated by an
act of the Legislature "with banking
privileges" The manufacture OF the
chemicals was carried on in building
on Thirst-tirst street, near the North
river-subsequently bought by the Hud-
son River Railroad Company and turned
into depot. The banking business
was done In building where the Park
Bank now stands-2l6 Broadway. Mr..
John Q. Jones was superintendent OF
the chemical works, and John Mason
Mr.. Mason died in 1889, and Isaac
Jones, his son-in-law, and cousin OF
John q. Jones, succeeded him as Presi-
dent, he having been the cashier of the
bank for several years. On the election
of Isaac Jones to the Presidency, John
q. Jones succeeded him as cashier, and
by them the affairs of the bank were
managed until 1874, when a complete
reorganization took place under the
General Banking law passed that year.
John q. Jones was elected President
of the bank. The capital stock was
$500, 900, divided into 1900 shares of
500 each. Mr.. Jones, on his succession
TO the Presidency, was surrounded by
coterie of rich and influential men. and
g. V. S. Roosevelt, John David Wolfe,
Robert McCokry, Peter Goelet, Robert
Goelet, and Joseph Sampson became his
associates IN the management OF the
bank. These men held shares IN the
bank, and deposited their money in it.
Among the depositors were the Lori
lards, the Stuarts, and many OF the lead
ing New York merchants of that day,
including the late Alexander L. Stewart,
who, however, could not be classed
among the leading merchants at that
time. Mr.. Jores had settled plan
from the first, and stuck to it.
1t was to do business with a small capt.
tai stock, maintain a large surplus and
command the confidence OF the public.
Most of the shareholders were already
rich, and it was agreed that the profits of
the concern, instead of being paid out
in dividends, should be used to extend
its business. Thus for five years-from
1874 till 1849-no dividends were paid
out At last the surplus became SO large
that Mr.. Jones became embarrassed and
asked the advice of some of his friends
who were interested MS TO what ought to
be done. BY one of them he was told
that the safest place for him to put these
large accumulated profits was in the
pockets of the shareholders. A dividend
was declared accordingly, and since
1S49 dividends have been declared
regularly. For many years past these
dividends have amounted to 100 per
cent. per annum. The system has been
to pay dividend of 10 per cent. every
two months, which, in the year, would
amount to 80 per cent; but, just before
Christmas, an extra dividend of 10 per
cent. would be paid out, making up the
full amount of 100 per cent. per annum.
The present market value of the shares
cannot be told for the reason that they
are not on the market. The last that
were sold brought $1,000 per share of
500. Although paying out these enor-
nous dividends OF 100 per cent. every
year, the bank has a surplus Of $3,000,-
900.
For many years the Chemical Bank
has been regarded as one of the sound.
est financial corporations in the world.
During the great panic of 1857 and the
crisis of 1861 it was the only bank in this
city that maintained a gold basis. In
1873 it could have done the same, but
was forced to succumb owing to the great
pressure made by the other banks. The
business of the bank increased SO rapid
ly that three years ago it became neces-
sary to have an enlarged space for carry.
ing it on. A building on Chambers
street was leased and connection made
with the old building so as to form an L.
The banks list of depositors, although,
of course, greatly increased, has not
changed in character. 1t includes a
large proportion of the wealthy real-es-
tate owners, retired merchants, etc.