Year: 1859

STATE OF New YoRK, BANK DEpARrxrr1


ALBANY, Dec. 81, 1858. !
The Superintendent of the Banking Department in ac-
cordance with the provisions Of section IL Of the act
organize Bank Department. has the honor TO submit for
the consideration of the Legislature the following


REPORT:


The speedy return specie payments by the banks Of
this State, after their suspension in October, 1857 time
has shown a substantial and permanent resumption
Of their corporate obligations.


1t exhibits solidy Of capital the part Of the
mercial as well as the producing community which cam
not but be gratifying TO every observant citizen Of
State II also furnishes evidence of the financial ability
with which these institutions managed that will add
strength to the confidence Of the people Of the State in
our present banking system.


The suspension and resumption Of specie payments by
the banks Of this State in 1857 with the surrounding cir
cumsances have simply brought bold relief the
perfection oil our free bank system in its connection with
our currency.


The retirement Of $500 600 Of the circulation Of
the interior banks accumulated in the city OF
New York within the time specified by the
resolution of the Clearing House Of tho 7th OF
November 1857 (wh an occasional exception for an m
significant amount since paid clearly shows that they
were not only strong in capital but that their ability to
qudate that debt only equaed by their desire to
enter upon course Of policy that must produce speedy
resumption Of specie payments clearly foreshadowed by
the passage Of the resolution referred 10.


The passage Of that resolution the ncpent step
wards resumption, and the willingness with which the
interior banks the obligations reflects
great credit upon the city and country institutions.
The entire 81 100000 was, by the terms of the
solution, to be paid in monthly nstalments Of
twenty per cent with interest at six per cent commencing
the lst of January 1858 This would retire the entire
amount by the 1st Of May They also to redeem their
outstanding currency on e usual terms after the 10th Of
November.


The pressure preceding the suspension returned to
the banks during the quarter ending Oct l. 1857, million
and quarter of dollars Of their best securities held in
this Office, Of which at least million withdrawn by
those located in the interior Of the State.


Hnuy tho ointo hunGc tha
ment Of the Clearing House Of the 7th Of November
is shown by the fact that between the 1st of Octo.
Der and the 1st Of April 81 900 Of securities
retired from the Bank Department and the
superintendent believes that nearly 100000 Of that
amount was used by the interior banks 70 restore the
themselves the loss Of which occasoned by the hold
ing Of country money in that city, AS an evidence Of the
correctness Of the belief expressed above he would say
that the discounted debt Of the banks located of that
city reduced only $50 1926 from December 26 1851 TO
March 13, 1858.


This equazng accounts between the city and country
banks was the work of only five months, in addition TO
meeting their ordinary and daily abities and the entire
debt Of 81 800 900 paid netting SO per per
annum interest upon the investment Of the city banks in
country currency.


those OF the city Of New York. in relation 10 the currency
accumulated in that city after the disasters Of the fall Of
greatly TO their confidence in each others capacity and
soundness hereafter.


The present condition and of securities held in
this department for the redemption Of circulating notes,
and the sum total issued upon the same, shown in
table No. l, attached to this report also presents the
fact that but five associations have been formed during
the past fiscal year for the purpose Of pursuing
Of banking and Of these is the continuation Of
1858.


The actual increase Of capital during the year,
by the formation Of new institutions, is $500 600;
the Bank of Poughkeepsie raising its iDcorpo-
rated capital from 100000 TO $500, 900, when
it became free bank Still more marked is the fact that
individual banker has commenced business during tho
past In connection with the unusual dearh of new
banks and the small amount Of capital employed by them,
comes the astonishing fact that while the actual increase
of capital by the formation of banks has been only
$500 00 there has been added the banking capital Of
the State the sum Of s9, shown by their
spectve quarterly reports of September &c. 1857 and Sep
tember 25 1858. This addition to the aggregate capital
Of the banks has been made during q period in which
fourteen banks have actually ceased doing BUSINESS
and whose affairs either being closed up BY their Of
fcers, or by receivers appointed by the courts.


One OF the which tended TO produce the sspc.
sion Of 1857 the Superintendent believes and 80 stated in
his report Of that year, the multiplicity of banks of
small capitals Still he believes the bank capital of the
State smaller than Is required by the usual business Of
citizens Their relief cannot be looked for the null
plicaon of small banks but in raising the capitals Of
those already in existence when located places where
increasing business additional bank facilities
The Superintendent looks upon the direction the
increased bank capital Of the State this year. adding
more to the stability and prosperity of the business men
and to the banks themselves than when he starting
twenty five thirty nstitons year with three
times the amount OF additional capital The fact that four
teeen banks have ceased to do business is regarded
by him as general loss to citizens nasmuch the
aggregate increase Of bank capital beyond all that has
been withdrawn during the past fiscal year is S9l
while the number Of banks actually engaged in bus-
ness has been reduced from three hundred and eleven
TO two hundred and ninety seven during the same
period.


The present condition and amount Of the securities held
by this department. exhibited in table No. for the
redemption Of the currency of the free banks this State
give renewed and strong Indications of the stability it's
currency.


The total amount of securities held by this department
the 30th Of September, 1867, $50 203 632 OT
Amount held on the 30th Of Septem-


ber, 1885, 26, 1893 O9s s3