Newbernand Cape Fear
lording the only probabl
aud preventing the establ
Jhad before 'ineytioned. If tha Banks, of ewbern and Capi
Fear surrender their charters, the StatclJank' is iel;t alone to
decide, at the pleasure of the fewHiading directors, what'des
criptions of persons, in the state Khali be accommodated with
loaus aud what refused." If from ruprice in the Bank, or for
the promotion , of tlieir design.-, lartiuliir iuditiduals are
loomed to destruction, and indulgence is denied them -no other
Bisk being in existence to interpose it assistance licliyjpeu the
deyoted individual and his ruin the sacrifice of his credit and
estate becomes inevitable, or he preserves both' by a surrender
of Jus political independence to the views of the aristocracy.
" Another advantage to be derived' from, the continuance of
tljLeseJSanks will he the increased t-Vuvenience by lyltich the
state can obtain loans on an emergency,-;- a instance of this
convenience is tit this moment be i ore; you
We arc all d
the direettavby
to makethv payn
ins this desirable object is to borrow the money and advance it
to the United State,. As a member of lhe eommittee to whoii
this subject was referred, Mr. .Stanly said he had partaken in
the negotiationvith the Hanks for the loan. They had first
applied to the State Bank. To (he enquiry, will the Stale
Bank lend tlie sUte the monev to advance to fi United States
HOUIMS OF. COMMONS, ()n. C.) S T U H t A Yj'DE C U, 1S13 5
MB.. STAVES JFEKCHi - V ,
ON THB QUESTION OF EXTENDING THE C1IARTKRS AND KSLARGr
n H(i THE (JAPIT.VLS OF f HENEVBKR'n AtCITtJAPE FEAR BANKS, '
' M'i. STA.NLY said the hiusS had tieard the gentleman
from Orange (Mr, Cameron) w!h had jast sat down, with their
' arcustomed politeness: they had heard with attention, Jie
had heard him with pleasure He said with frfl.sr, because
the o'.vrvalioHS of the gentleman, although aided by all the
sophisiry and ingenuity f his ability,' fell so far short of -refuting
the argument in .behalf of the Bi:ks of Newbern and
Cano Fji'ar, us lo remove every doubt' ol the goodness; of their
cause. Mr. Stanly said if the house were not already satisfied,
lit- !, lieved h was 'in his power to convince them, that tojgant
the prayer of the Bank of Newbern and (.'ape Fear was pod
polity, and (hut (he Legislature wore not restrained from adopt
ins thai policy bv anv thing contained in the acts granting the
charier to the State Bank. Tlic liouie would p-don fciui if
h'-irit tiotked t-rur remarks oV the gentWman Uuh dfd not
re!t to the merits of thr ifUestibii; His observations vvlkeiij
the subject was before the house n a formfcr day, though then
umiotieed by., the gentleman from Oraiigiywere nowcailed by
bi n a vi d nt alteinpf to excite the passions, .and to i create a
tvH.i isiv of I be Legislature toward I hetate Bank,'. ami w ere
.considered not Miinciently respectful towards those,' who mana-Jfor the diree; tax or what part of it, and on what terms" as to
g d (bat institution. ' Mr. Stanly said his observations, which credit, and interest r jhe answer was, the Slate Bank will lend
were allti.-li.-d lo, the house would recollect, were made ttprm the i proportion to its capital, -if tlu Hanks oj JVewbern and Cape
introduel ioa of the "memorial f'roft the State1 Bank : this mc-Fear will also lend tlieir proportion, and uton the terms w hich
tins is
Bank'
injustice oi mis memorial in rrgaru 10 nu uan.v. wi -wc nave u in wining: nicy wuum jiui ov iuiulti uushui
Newbern and Cape Fear, whatever ground of complaint might to any enquiry, neither as to the sum they "fould lend, nor the
lave existed against the State Banky not one word of reproach rate of interest, nor the! length of credit iHow different was
t lie; ban ks ot ;N e w bern
ne qucalion, ana nttempt-
tbe odfim of defeating a
hey replied promptly and
us the most atHkiTiw " a
Hatures of the benefits derived from the American-bankiwX
system are,.lsT. Punctuality in all commercial trnnsactiou5y
" wliich aloiic.' is the saving of many millions aiinualry. -.to the. A.;'
ik. United Stales -v2d. It reduces muryt whereygr fhiere ls.Vsiifi.
"ficient number of rival Banks,, to prevent k mbnopvlu ofr its '
"benefits" . - , : fk' ' V A
" lu a town of 7 or 8000 inhiiljitants, a banking capijal'of a T' '
" million divided into iwy parts "or even niore jprtJ rattier A
" than all in one, vill be fonnd more beneficial for the aye-age .
" of the community, thu perhaps not 60, advantageous to the U-'x
" stockholders' Mr. blouget then demonstrates that poblitj ;v
safety as well as public convenience rs consulted by the increase .
of Banks, since the greater their nuyiher the less the amount of 1
utiles iuc issuni citwil, tiiiu uio aiuaftrr me klllll 01 U010 C'
esirqus, rf possible, to alleviate', the burthen qtimi.tted by each, the greater must be the ability of the bank. to ;7t
assuming it ami granpn-x me people iwp yarseei mem- r nen uaiiKs w.ere nrsi lnsm.utt!, tney cacueu ;
lent Instead of one. . 1 E only means of effect- l "jnsny unreascnable kaloiisiCis, autiMese have jjabsidtil in- ,
Y. im 4 '
.P." : .
moriul he had then srated l be u .tissue of error, bolli , J. t faetthe Newbern and Cape Fear shall consent jo ! Yes, s.ir, this
and in reasoning: .yet, but for what he considered the arro-' all the satisfaction theomm'ilitee oiil tined 'Kin tie Slate Ba
ruice and injustice of this memorial in regard to the Banks of wc have it in writing : they would not gWe a direct u-nsw
.' . . . . . r i i . 1. 4. . . t iii' a i. r.- .1 i i . a
should have escaped his lips. The meinorjals ot the IJanks ot the treatment I he state received irom
Neu bern and Oape Fear coiained nollung to justify the lan-j and Cape Fear : Jiisiead of evading (
gn i'je oi the State Bank nlemorial : they plainly and taiiht uliy jing to throw upon a rival institution
fi'nl l.of'nr' lio Tji'cisfntnrp tlie-didicuitieS under which thet la- t PiiVorite measure of the Lesisladii e. 1
bored from the oneratious of the Slate Bank, without any cri- franklv, we will each of us lend the
initiation of that institution, and in return 1 hey had been made
the subject of charges and insinuations, uiig"neroi:s and un
founded. This was the provotatiunun w hich he spoke if he
poke wiilr warmth,- he lud still spokcu with truth: lie "dis
claimed ajiy intentiou of creating unfounded jealousy against
the Hlate Bank. lie adtVesseti himself to the sober reason of
the lious.', when he placed before themihe dangerous influcircc
which (he Stale Bank would possess, if, Cor want of eneourage
menl fi oni the Legislature, "'the -Banks of Xewbern and Cape
iVar should surrender their cluarlers and leave the State Bank
wiili.)iit a rival, una wed and unchecked by any competitor.
A single mouied institution, under the colnplete control of
three, or four large stockholders, would "thus become afi ansto
craey of lite most dauerous, of the most adious kind an aris
tocracy of mmey. Yes, sir, with their branches jn every cor
ner of the state, without a rival, the sole arbiter of the credit
of the country, giving assistance or increasing distress at pl'ea"
lire; no ' mail will b free fro in their inlhieuce : every stock-
hwjdar wil'i be tbt ir friend, every debtor their slave ; they will
not onlvjr.it but they will pin out of this house whomsoever
they pl:Mtse.
This, sir, is a view which experience justifies me in taking
o? the dangerous influence of this institution, if left to ilst'lf. -3!Vith
Some of. the .,direcoi"S of the St at Baiik I am proud lo
knowledge an intimacy, a;:d for some of them not unwilling
to profess my respect; but sir, as the Unman stabbed to the
heart Jus friend, when that friend as pi rail to he a tyrant, not
. because he loved Ctesar less, but becailse he. loved liome more,"
so sir, I speak the plain .though it may he the offensive lui
gtiage of truth regnrding Ihe-diiectors of the State Bank, not
because I respect the in less, but because 1 more respect, the
rights and the interests of my -country.. .
ilr. Stanly said the. report ol the eommittee now.und'er -eon-.
sideratioiit proposed to eitend the duration and to enlarge thv,
capitals of the Banks of New'bern and Cape Fear. The advan
tages wfiich had resulted to the slate ind to the people from the
operations of these Banks, were Admitted by. every person of
ordinary information. Thfiy were the first, and for seven years
the ojily Banks in this state. With a capital of only four hun
dred thousand dollars, their beneficial inifuence has extended
to every partof the state. "-.The public, t re as M-y has repeatedly
tciu. assisted by loans from them, the citizens accommodated
upon terms of Uiiprccudenled ".ndulgun?f, and scarce a pubiie
inslituti-on of iinport"ancc which had not in some way heeu.be
.nefit'led by their operations. ' " 1
Upon the 'decision... of ; the present qutstion it'would greatly
depend whether these advantages should Tie continned- and en
larged, or whelher the Banks aud their beuehts shouk
"tw"? xt'strvT1 T - r
great degree, sinee it is1iroVn tfit MfiMUr'acfuiHria ?
practices add tend l o make ot every sixty3 dollars acireulalion
' of eighty, thereby incpeasingthe jadte. money of the eonimu
" nity one third beyoiid its real amount iu species tth no risk t
" and yet as it is Ihe'iiature of. mau to imbibe prejudices, it is I
incompatible with the general interest of a large community
" of freemen, that either a single set of Bank directors or a sin
" gle company of bankers should LaVe an extensive eoiitroui oier
" the necessaries mot essential to bur natural or political exis-
" fence ; hence, by equitable divisions, lho banking principle
" should be distributed over every qKiirter of a City,; with, a
" Capital- of not more than oumillipu of dollars to one Com-?
" pany." '. . .','
,Ilegardtng the extent io which the banking principle maybe'
carried without danger to the community, MrBIodget is of o
pinion that the thing may be-left to regulate itseltVsinee it is
"found that where banks are not Wanted the sub3cription will
" not till." ,. ,.,.:..-.:'. .. ; .
It i i as absurd to expect. an anxiety to oblige or a disposition to
state tlilrty thousand dol-, indulge, to exist in a single Bank having the'sole right to carry
lars for the assumption of the direct tax, anijas much more, if j on banking business, as it would be lo. hope for low prices and
desired, for the purpose of internal defence, :al six per cent, in-' long credits for merchandize, if a single store in the state had
tercst, and payable in twojannual iustalmentt. After these of-;lhe cxcliisiveprivilege of .selling ijoods.
fers, "and not before, the S.Late Ia:ik, not j et ind.epenueut of
puujic opiuiangave. its reluctant, its sullen eousent to lend its
proportion upon the same terms. 11 ad thf State Bank stood
alone, thin mouev would not have becifat your command, or
you might have obtained it, perhaps, at an interest ot eight per
cent. "
Another advantage to the state from the preservation of the
Banks of Newbern and Cape Fear, will be the revenucwhich
the-state derives from taxes and shares. On this'polnt let ex
perieneepeak. ' The state has stock in each of these Banks to
amount of 25,000, for which it paid its own paper money. In
live years the state has derived from these Banks, in dividends
at the rate of JO per cent, and tax of one per cent, per annum',
fifty thousand dollars! Enlarge the capital and increase the
shares of the state, and the profit of the state will be- increased
in the same propcrtiou.--On the other side your account w ith
the Stale Bunk exhibits a very 'different view.
The state subscribed for 230,000 stock in the Stale Bank,
of uhich sum there has been paid in the funded debt of the
United States held by this state, and in cash, SS,000 ; and for
tlje, balance, gl64-,o6o, still due the Bank, the state pays an
interest of per cent. -.
The State has paid the Bank two years and nine months in
terest on 464,000, at 4 per cent. , 81S,010
The State has relinquished to the Bank the interest
annually payable on the funded debt of the United
States assigned it, which, lo the atst of the pre
sent mouth, would have. amounted, by, the books of
tee vomnussioner oj Loans, to
14,593
cease
The State Bank, instead of consul ling the interest of the
eoiitmuuityj in cherishing harmony with the Banks 'id' iVew
. bern and Cape Fear,5 which it found in existence-iniMJLilbf
extending to'wAfd them that liberal spirit of 'inteieoiii He which
. ought to exUt betwet.a .sucli institutions created as well aV it
self for tfib public g'tod. had ussiimed an attitude of . hostility
tow ard-tliei oJ fecr ,B. t k. : Even befor.e its own stock, was. paid
- up it. began the vviirfaro, by receiving the noJes of the other
. B. ksal adiso'iut in payment of slock., although its charter
. required the stoik, the 4t,h jiayment" excepted, to be paid in
gold, and ''silver. ." Subsequently it has had agents im ployed at
ctaiiywagaiV-tuut laiig itte notes oLahe Mate Lijank uhont jLhe
siatu, in cxpiiiuig-f iw me lions oi me omer lSunKs.
Making an aggregate of
For which the State has received three dividends
of
32,633
two. and a half per cent, on its stock, amounting to ' i 8,760
Leaving a balance of actual loss hy the Slate, from
its concern with tlie Male Hank, ot
813,383
Whether, therefore, we found oT' opinions on the reason of the.
thing, dr seek information from the vritiugs.of practical men,
and from the experience of other stales, wo wc brought to the '
conclusion that liberal dealiug and beneficial effects are only ttf
oe expecieii ti oiu uhiiks, wiierc uiuereiii cmuiisiiimciii!
'and that the surest mode to protect the people from the political
tkience of a set of Bank directors, or to sTielter them froiriVth'e
usurious grip of the thrjte-per-cent.-aTnionth men, or fromlhe
shaving operation of a few favoured borrowers, is to have rival
banks. , ' ' ' ' .V .' .' ' '"......' , '
Having said thus much of the expediency of continuing the
existence of the bank? of Newbern andjCape Fear, Mr. Stanly .?
i lii i i . ' . . i ' . i
saiu ue w ouiii proceeu io examine ine oojeciions wnicn were u i g- -ediiropposition
to the prayer of the" memorials; of the Banks'.
The Committee of both houses t?- Y'homrthe memorials hive
been referred, have reported a Bill to permiUhe Bankiof Ne W '
bern nd Cape Fear to enlarge their Capitals to an aiuonnt e- 1
qual to the Stock of the State Bank and to extend their 1 dura
tion from the year 1820 when their present charters would ex
pire, to the year 4833, the term grantetl to the1 State Bank. , -
Against tins proposition it is alleged that an enereae of bank .
capital is not necessary That the State Bank call accomodate .
the wants of all the people, aud that the i$tate Bauk has bbt , ;
been able to fill up its capital. . ' V.
By what rule the gentlemen undertake to ascertain. the ltoo
much' or too-little circulating nredium'of the State, J am iinin- :
formed; I do know, however, that although tie ruined state of
commerce, rendering torpid cbmmerciaL liiyltandl tlie' ' '
peratioii oOhe suspension acl, postporiipgrthe collection. of
debts, have, for a while, lessened the';iieessitTof.borro'wiijig
and reduced t he u rgency of the appficat ions to the Banks, there -are
still applications for as much as the banks can lend- And
so far from money being obtained at 8 per centfgood paper sells
at adiscount of twenty live per cent.f If tJie'State ,fiJ.k,Pr',y. of
it branches believe, they coold lend more than they have a!
ready lent," let them manifest' a willingness to Joan and they
if'
During
the-short period, thai the( Slate Bak' had established a. credit
, for their-notes in certain Northern lia'.jks, ahd their notes' thus
ans wered 'bey obtained the notes "of Newbern
. aud Cape Ftrar at a discount in exchange Tor.their ' nqteslhey
held out. every inducement to the people to pay .theuj NeMijerii
and Cape Fear notes, n' w'iibtlieise.'' notes obtained by these
means, by-shaving and otheiwiie, tlieyrmade runs upon the
Baakji. Although the. charters of these Banks have j et some
V years to run, it 'behoves them as early as p'tfesilJe 'to ascertain
. under yhat eirciinistauceijyt hey- ace to exjst. .The past warfa-pc
1 having added nothing to the 'luvpaet er, to the 'credit or to I he
interest of the Stattf Bank may Le supposed to be disregarded
hy th'em ; hkt it i . ai'ittiqssibIe.-''ior.' a. Bank ' of. two-hundred'
ihMAajiAolVUai'spitai-lo-carryo
. against the'eontinued h'ostilily of a Bank of one niiliion capital,
as S is, for a chUd to conteyd against a giiuit. "The humblest
. t viiic hits its use as well as the loilicitbakThe Banks oNew
v hern and Cape Fear, he should shew, had in fact been more va
luahle UKthe state and more proftalde to the stockholders thai
j the State Bank, and were entitled to Legislative protectio'n :
bill if by rejecting their, present' application,' they were left
7 weak, to be trodden down by the ."itate Bank7the sooner they
laid their charters at the feel of the, Legislature the betterT..,.
Mr. St auly said it vr&'txjpcdhnt to preserve the Banks oi
To ubich niay be added the lax not paid by the Stale Bunk, will soon 'fiid customers. AVhilesir there artv applications to
whieJf paid at the same rale as that on the other Banks, one borrow, more than the existing banks can lend, it is-as-.absurd
percent, on its actual capital, g 1,200,000, would have yielded .to say there is already too much banking ca:)ital,as it would
to thft treasury iu the three years it has existed 38,000, : which! be to declare lhere was too much land cleared, or. too. many -?um
added to the actual loss shews, thttt while the Banks of houses built, although; every i field yas cultivated, and every-'
Ntnvb'erK aud Citfe Fear have protitted the state fifty thousand house had a tenant. The use otinoney or its substitute tTank
dollars', thcStatc B'aiikj, by the management of its wise men,,notess proportionBd to the commerce and wealthof the state.' ;
has lost the stale an equal amount. ' J . i Can it be believed that orth-Cargliha, the, fifth state of the
And herej- sir, I will nat i-c e A 1 1 e o ') s p rv a t i o n oftlie gentieman Union in point of poii'ttlation -auH: j territoryf'lilas not as'mnc'tVl
fromilJhugAir. JJameroti ) that the Banks of 'Newbern and 'wealth and trade, and cannot employ as much bank capital a'"4
Cape Fear were invited to subscribe to the Stale Bank, but that is kept ijn 'ottifUy in the ten-miles-square distrirof ColumWa,
like nndiitiful children- they had refused tlie good provided for for lu;ili6' liUleA'btate'".of Rhode-Island ?i; 'And yet, Sir, the ca'
them! it is true, sir, the stockholders in these Banks had notipitals of the banks if extended a proposed, and that v$thd
. f . .....1' ....11 .. . 2. aw Aw.nwl . 1 . .. 1 . I. a V. . 1 . - . ' '
oinic win uyi tugcuici cicccu iuc uj.ii vi 111c uuiin i.ilju;
tal in the district of Columbia or in thii' small staie of Klipda
Island. :'..Thaj ' the 5 siat bank stock is not sought after, jOjily v
proves that thp plaii aud management of that Institution have
notsee'lired rgeneral eonfidjence. .t-Jt cannot be quite consistent-,
to 'say Jthat there is already bank stock enough and no njre
will sell, and yet tell us there.will be too much .if'tfie biH"a;u- v
thorizes the banks of Newbern and Cape Fear tqAeIarge their.
stockSincejf the stock is not wanted, the' snfccrip.t ion will
not fill and the encreaae will be on paper only. But "jetjt be
supposed for the argument that there may be-more baiiklnVcai
contideuce in the promises of the Stale Bank proji;ctors : they
declined the invitation to convert, tlieir stock ,intd Stale Bank
stock IS mety-nine in an hundred, pt their fellow-citizens
thought as they did,- and did not subscribe, aud are therefore
alike undutiful. - The Banks tf 'Newbern and Cape Fear still
decline this transfer of their funds, Tjey, make, ten" per cent,
dividends while the State Bank can get but fivi- their ambition
does not prbmnt tjiem to become partners iu the aristocracy at
the expeuse of five percenliayearjon lhair capital.
Another beneficial effect of "enlartcing the Capitals of the
Banks of Newbef-n and Cape Fear was, that the Commercial
capi
be
at Lome
citheeus would be rendered fess tributary to other states, lind
by a less -expensive intercourse 'between the farmer aud the
merchant bptlivould be benetTtted., ; V , ;;: ;"'.,; . . "
A" farther beuetit pf eoiisjderable importance ought hot to he
overlooked--if their capitals are enlarged," theseanks may
establish jiraiicKes vvheii atpreseht there are none. - Why Shall
not lillsbof Warrentori, rlalif&x, Morganton, Wiodso) and
other? tiourisliitig towns atid rich countiesfhave lhe"henefifsof
access to batiks, as well as the few that now cniy them ? At
: I
veryEipLLlhfc-itate
jtannot he in ai)y ; wise-lnuriQiis to :the community. If thebaukt
eittijt; notes lor. wjnclr there is.no employment, they;wii return
upon them l they must pav them in specie ; this error cannot lnri$
be indulged for 'their interest's sake they will not ?ommifit
twiceilThe surplus capital thus useless in banks, will speedi
ly be directed to other purposes j the establishment of manul'ue
tures, the maklngturiipike roads and canals. This applicatTun
of the money may not be as profitable to the proprietors as bank
Stock, but it will be as beneficial to the uublic. On the othctf
banks, or a loan costs the citizen a commission to an atrent, or
a lotig jouriieaud 4 expense perhaps of 10 percent, bu the
money borrowed.!? .' . - V -
Among the use3 of. Banks, their tendency if uprightly con
ducted to keep down tisifry, ought not lo h overlooked but ; nei
ther thisltor any olhcc til' their jiises can be ralcuUted if
there be but Single Bank.-Among Banks (a among individu
als competition is necessary to secure diligence and integrity,
aud to create a 'disposiiion by, good conduct to obtain public 'fair
vour and conCdeuee. .. " v..-.l j ;
htseat laml.5iuath
u then in fact a earcity of circulating medium ; the conse
quences , are obvions, enterprise is checked, property and jirot
duee fall in value intlustry is discouraged, usurv ih.arisl.es,
i4ie poor are trodderiyowni and the bank slotkhold'er gets rich.
No man bat a stoekholdr in the State Bank ean fail to set that
an excess of bauk capilal, if such excess coiild be created, o tut
ffoia being injurious, would, be highly beneficial to the state .
t i further otjeettd tliut the state, by conipacti with the State
ha; k made in thery- ars IS 10 and 1811, is prccfudet! firm adopts
Mi g the measure. T tins opiuion, Mr. Stanly said, he eutered
' i' ' '' .'. .; ."'"V7 : '.':": " " ' "'
V
V.