The Eaton Democrat. (Eaton, Ohio) 1875-1903, 1879-09-11
sHERMAN,s PET BANK.
And the Peculiar Financial Operations in
Connection Herewith.

SHERMAN,S PET BANK.
And the Peculiar Financial Operations in
Connection Herewith.
New York Cor. Cincinnati Enquirer.l
That the First National Bank of New
York is John Sherman's pet bank, was
shown by his recent extension of time
on check drawn on the bank for 81
100000 by Acting Secretary Gilfllan.
while Sherman was off junketing and
speech-making recently. Mr.. Gil6llan,
who is business man, wanted $4,000
600 for the use of the Government, and,
very naturally, he drew check on the
bank that owed the Government the
most money. If Sherman had not gone
out of his way to grant the extension,
the First National Bank would have had
tc pay up promptly, just as the other
members of the Syndicate did.
The reason assigned by Sherman for
granting this favor to his pet bank is
that, being the last to subscribe, that
bank should be the last to pay. AS a
matter of fact, all the banks subscribed
on the same day, within few hours of
one another. In other words, Mr.. Sher-
man permits the First National Bank to
profit three-quarters of one per cent. on
$40, 100000 because it was about three
hours behind other banks in subscrib-
ing to the loan. There is no reason forhis
extending the time for the First Ma
tional Bank to pay up that would not
justly apply to other members of the
Syndicate; and the opinion is freely
expressed in Wall street that the First
National Bank has been made to share
its profits with Mr.. Sherman's friends.
A big slice of the profits went to defray
Republican expenses of the pending
canvass in Ohio. 1t is freely asserted
that member OF the Ohio State Re-
publican Committee went to all the
Syndicate banks and substantially de-
manded share of their profits to help
bolster up Hayes. At least one-half of
the banks, however, refused to pay
cent. The officials applied to said
promptly: "Pve got no interest in the
Ohio election. I would just as soon
see Ewing elected as Foster. I don't
care fig about either one, and I won't
subscribe cent"
There is much dissatisfaction among
national-bank officers and other holders
of call bonds at Sherman's preference
of the First National Bank as pur-
chaser of 4per-cent. bonds. After his
circular, promising an opportunity to
holders of 1O-40s to exchange them ad-
vantageously for 4 per cents, his sud-
den dicker with the Syndicate, and his
preference of the First National Bank
to the detriment of more than 1000
other banks is considexed as influenced
by motives somewhat peculiar. An
officer of one of our banks said this
evening:
"Sherman gave all of us cause for
complaint when he gave an extra COM
mission to banks that made speculative
subscriptions. That was poor encour-,
agement to banks that were acting
prudently. When the First National
Bank wanted to realize on these bonds,
they got the price down to ! per cent.
premium, with per cent. of earned in
terest. Since they got the extension
from Sherman they put the bonds up
to and per cent, showing the value
to them of being relieved from the pay
ment of their debt to the Government.
Instead of permitting the First National
Bank to play fast and loose with the
Government, Sherman ought to have
kept faith with the other banks, and al
lowed them to come in and get some of
the 4 per cents. There would then
have been no need of granting an extern
sion TO any bank; and when the Gov
ernment wanted its money it would
have got it. As for Mr.. Gilfllan, he
would not take any part in Sherman's
scheme to favor the First National
Bank. I guess he would rather be
kicked out of there than not. He is
not afraid of Sherman, and evidently
did not understand ShermanIs plan to
favor the First National Bank, or he
would not have drawn that 100000
check.
"There is no doubt that if Sherman
had not stepped in the First National
Bank would have been in tight place.
They would have been obliged to offe1
their bonds, and must have broken down
the market. This would have been dis.
astrous. One peculiar feature of it is
that if the First National Bank had
come to grief by its speculation in 4
per cents. its depositors would have lost
everything, because the Government is
preferred creditor. That sort oi
gambling in banking should be prohib
tied by law. 1t is singular that the
Government, having charge of oul
national banks, should permit sucl
enormous operations by small bank!
like the First National Bank, knowing
that if the speculation failed the result
would be so disastrous. Sherman ha'
been 80 partial to the First Nationa
Bank in the matter that it is common
talk in the street. The attempt tt
make capital for the Ohio campaign
fund out of the Syndicate banks is alst
well known. MIR. Sherman's explana
ton of his reason for giving an exten
sion to the First National Bank viii
not bear investigation by those WHIT
have watched the course of events
He has, at least, narrated the facts il
such a way as to deceive the public"
"Have you any positive reason t.
know that politics have been brough
to bear in the placing of this 4-per-cent
loan by Secretary Shernan?"
"Onlyt this: Justbefore the announce
ment was made that an extension O
time had been granted by Secretar.
Sherman to subscribing banks to tn
4-per-cent. loan, member of the Obi
Republican State Central Committe
called on me, in connection with m
bank, for subscription to the Foste
campaign fund in Ohio. I asked VIII
he came to me. He said that Secretar
Sherman had directed him to call O
Gen. Hillhouse, and that he would Civ
him list of banks to call on in this cit.
Gen. Hillhouse had given him the lii
of those banks which had subscribe
to the 4-per-cent. loan, suggesting at th
same time that out of their profit the
could certainly afford to contribute"
GWoa ba sucoaseful in solicitin0 m,