The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1879-03-22

Compared with the report of the 9th of December
il appears that the loans and discounts have de-
creased since that date by $7230O0. The legal ten
der notes have increased by S5lS 900. The amount
due from approved reserve agents from New York
banks, that is to say-has increased by $3.50. OO0
while on the other side of the account the ind-
viduai deposits have increased sl544,00o The other
stocks, bonds &C.. must include all the State and
city bonds held by these banks. and tho
amount, it will be seem is trfing.
The statement is considered o good one. though
there is large increase in the amount OF funds in
New York banks. which was but $4,000 in Decem.
ber against 81. 24l 900.
The total deposits in all the New Orleans banks
arc reported to be about s1OOoo.OoO. In 1859 they
were s2l 100000; in 1860. $19,O0OO0O. This shows
the considerable since then OF the business
of the city.
LoUIsnNrAS's EXPLANATION
senator Jonas. OF Louisiana. who left New Orleans
week ago. said to-day that at that time the national
and State banks generally complaining Of hav-
ing too much money hand for profitable business.
The demand very light and at this season OF the
year money was flowing into Now Orleans rather
than leaving it. Tho Southern Bank which had
pended was only State bank and. though conducted
on safe business principles. had large investments
in what arc known as city consolidated bonds
par value These bonds protected by
legislation which provided that the interest should
be paid out of special taxes. and which also provided
for a sinking fund to meet their redemption. The
consitutionaliy of this special legislation tested
before the State Supreme Court and decided ad
versely, which deprecated the city consols fully
twenty per cent, and tho Southern Bank held
about S600.000 In these bonds the loss necessarily
embarrassed tho bank. and hence the failure. II
was however, only o. bank of exchange. he says and
did no discount business whatever So sound
its management that in 1873. when the New Orleans
banLs were compelled to do Just what they arc
now announced to have done, the Southern Bank
was able to keep out of tho mutual protective
operation and paid its dePositors on demand dollar
for dollar The suspension OF the bank has. he says
no Importance whatever None of the old banks. no
adds have loaned money state securities except at
q very large Margin and this class OF securities are
not accepted by the New Orleans banks save upon
the safest margin. There is just a scarcity OF
currency in New orleans by OF tho large de-
posts IN the banks private deposits and. said
senator Jonas:-
'rhc demand for money Is 40 small that tho banks
have opportunity of paying out that which they
would be glad TO loan good security. sec by the
New York papers that nearly fl.Vo000o has gone
forward 10 protect the credit Of the banks which
have the confidence Of our business men, which
means that this win put them to tine cost OF
paying for the transportation of funds between New
York ami New Orleans only to return the same in a
few days. tho action of the banks is purely
OF prudential character, and the strong have united
with the weak in order 20 do precisely what they
have done before to restore public confidence mo-
mentarily disturbed"
GENERAL GIBSON on THE SITUATION.
General Randall Gibson, who represents New Or
leans in the House, and who is familiar with both
the financial and the industrial condition of the city
and state. said in answer to the question why the
banks had suspended
IL have no private adviccs. The suspensions and
panic reported in the newspapers are undoubtedly
caused by the want of confidence excited in the com
munty by the discussions in anticipation of the
Constitutional Convention. They unreasonable.
for the convention is called in the interest of econ.
omy and good government; but vague apprehcnsions
have been aroused, aud private as well as public
credit has been impaired In my judgment both
will be benefited by the convention. There had been
a gradual decline in real estate since 1853 until the
Nichols government installed when exaggerated
hnnss antartainal Raal asiata and thu STATE