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INDIANA UNIYEESITY STUDIES 



to include the Farmers and Mechanics' Bank in the hst of those 

 whose notes were received at the western land office/ « and by 

 drawing on it at sight for large sums, the Bank of the United States 

 through its branches at Louisville and Cincinnati, hampered the 

 operations of the Madison bank so much that its directors found 

 the business unprofitable and its doors were closed. The bank was 

 closed in the course of 1824—25, by J. F. D. Lanier and Milton 

 Stapp, after meeting in an honorable way all its obligations, and 

 fulfilling all the conditions of its charter. 



By the time Indiana became a state, there were several banks 

 in it. It w^as thought undemocratic to limit banks by law in any 

 way, yet in a law of 1815 some restrictions were made.-" This 

 measure is entitled ''An Act to Prevent Swindling," and required 

 banks to publish the names of stockholders instead of the firm 

 name alone. The law Avas intended to apply to a banking firm 

 operating at Lexington, and thought to be composed of ''swindlers." 

 Another private bank, in which Noah Noble and some members 

 of the legislature were interested, was located at Brookville. Th- 

 Steam Mill Company at Vincennes, of which Judge Benjamm 

 Parke was president, w^as also a bank of issue. 



The vState Constitution of 1816 recognized both the Vincennes, 

 and the Madison Bank. A later law, passed January 1, 1817,"- at 

 the first session of the state legislature, elaborated the charter of 

 the Vincennes l^ank and made it a state institution hke that of 

 Kentucky. It was to have fourteen branches, to accommodate 

 the fourteen districts into which' the state was divided. 



Neither the article in the state constitution nor the law of January 

 1, 1817, gave the Bank any new powers.-^ They did no more than 

 to recognize its charter, increase its capital stock, and make the 

 state a heavy stockholder. Though there was placed in its charter 

 no direct limitation on its power to issue paper money, and though 

 one of the main objects of the institution was to make profit by 

 issuing its bank notes, yet the plain design of the whole charter, 

 and of several provisions in particular, was that the Bank should 

 not issue more paper than it could redeem. Its total debt was 



" Am. Sta. Pa., Fin., Ill, 746. 

 Elvin's srrap book, Indiana State Library, p. 68, copied from Madison Free Press. 



*" Samuel .ludah, Report cn Private Banks, Jourval of the House of Represeiitaiives, 1839; hereafter 

 riferred to as Ho. Jour. 



2' Mr. Parke was born in New Jers?-y, September 29, 1777. He came to Vincennes in 1801 and 

 .rom then till his death, August 12, 1835, he held ofiiee almost continuous'j-. He was attorney for 

 the territory, delegate to congress, and federal judge. He removed to Salem about l^lti 



■'■'-Laws of Indiana, 1816-17, p. 185. 



23 Blackford's Reports, I, 268. 



