THE FARMERS' REGISTER. 



181 



Capital ol the Peiersburg Branch of 



Exchange Bank - - - #475,000 

 Loans to and liabilities of i(s directors $219,606 

 Or nearly one half of the capital. 

 But the crack operators are ceriaiiily the direc- 

 tors of ihe little Branch (Exchange) Bmik at 

 Clarksville. 

 Capital stock, nominally $200,000, 



but paid in only - - - $175,000 

 Loans to and liabilities of its 7 di- 

 rectors, ... - $233,914 



Or more than its whole capital by $58,914 



This we take to be the ne plus ultra of what 

 are considered honest banking operations, for the 

 accommodation and profit of bank directors. 



Let it be observed that a director mitrht be in- 

 debted to half a dozen banks, and no doubt 

 many are indebted to several, and yet no more 

 of his indebtedness appears in this report, than 

 his debt to the particular cfiice in which lie is a 

 director. We have known one single family and 

 business connexion to have members as directors 

 in almost every bank and branch in eastern 

 Virginia. As most directors serve, and value 

 their places, merely to borrow as much money ae 

 possible, it follows of course that they will ex- 

 change such friendly favors liberally; and each 

 one who is greedy of large loans will seek them 

 from as many different banks as possible. Thus, 

 independent of all other particular influence, 

 growing out of family and business connexion, 

 a bank director has a general claim and influence, 

 superior to other borrowers, in every bank and 

 branch besides his own. 



It further appears from the staii^iical facte of 

 these reports, as drawn from the banks, (and 

 which is precisely such as reason and general 

 truths would have caused to be inferred,) that very 

 lew directors have any interest in the banks as 

 stockholders, beyond the exact amount that the 

 law requires them to own, to make them eligible 

 to the appointment. This amount is 5 shares — 

 and it is amusing to see in the report how general- 

 ly each director's stock is of that precise amount. 

 If a single share were enough for that purpose, 

 there would have been as generally no more held. 

 Bank directors are generally well enough inform- 

 ed to know that banking, (as they conduct it) is a 

 very bad business for the stockholders— and is 

 valuable only to the borrowers. They therefore, 

 for much their greater number, take care to have 

 as little as possible of the stockholding interest, 

 and as much as possible of the borrowing inter- 

 est in the business. In this town of Petersburg, 



these truths, (as well as other things important to 

 directors' interest,) would seem lo be especially 

 well understood. For of the 21 directors of the 

 3 branch banks, 



1 director, who owns the largest 

 amount, has only - - - 25 shares 



2 . _ . own, each, 15 



1 10 



1 7 



1 6 



and the other 14 - - - osharesonly. 



The officers (from presidents down to runners 

 included) of the Virginia Bank and its branches, 

 are indebted to them, $36,367, and the officers of 

 the Farmers' Bank and branches, $42,787. This 

 is another powerful influence operating against 

 resumption. The charter of the Exchange Bank 

 prohibited this class of debts, and therefore there 

 are none such there to report. 



At pages 63 and 64 of this volume, we presented 

 abstracts from the latest official reports of the 

 three principal banks of Virginia, showing some 

 remarkable evidei.ces of the treachery of all these 

 institutions, and the falsehood of the prefeneion 

 that they were using the indulgence of suspe^ision 

 of payments to prepare for meeting payment. In 

 the previous year of suspension, and of asserted and 

 pretended preparation to pay specie at its close, (as 

 required by the then law, and believed in by the 

 duped people,) it appeared from those reports that 

 the proportion of notes in circulation, to coin ia 

 the banks, had been increased as follows : 



January 1, 18-Jl. January 1, 1842. 



Bank of Va. $3.10 to $1 coin 3.38 to $1. 

 Farmers' Bank 3.34 lo 1 3.50 to 1. 



Exchange Bank 3.53 to 1 2.90 to 1. 



And taking a general average, these three in- 

 stitutions had, during that year (1841,) 

 Increased their outstanding debts, $667,462,56 

 Increased their circulation, 380.983,33 



Decreased their specie, 27,581,23 



Making total increase of liabilities, 



or of greater inability to pay specie, $1,076,027,12 



When we first prepared that abstract, the re- 

 ports of the small western banks had not been 

 published. Their statements are embraced in 

 the later report of the senate, and they vary 

 the above average a little, but not materially. 

 That report also differs from the above, in com- 

 paring the time of April, 1841, (date of com- 

 mencement of the last avowed suspension,) with 

 January 1, 1842, or less than the nine last months 

 of "preparation to resume payments;" and 

 the general results are, that all the banks of (he 

 state, in that time, had 



