﻿ESAREY: STATE BANKING IN INDIANA 



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branches should become worthless. The value of the notes was in 

 direct proportion to the soundness of the bank. In answer to the 

 Sun's letter, the Centinel printed the last report of the cashier of the 

 Vincennes Bank. This showed: debts owed by the bank, $243,898; 

 resources: individual loans, $228,000; specie, $33,000; currency 

 of other banks, $26,000; deposited with other banks, $17,000; 

 total, $304,000.49 This statement indicated a balance of $61,000 

 in the Bank's favor. The Sun's article, therefore, was to be ''passed 

 up" as political gossip not worthy of notice, unless its truth should 

 be challenged in court, and the editor arraigned for libel. 



Everybody now waited with anxiety to see the forthcoming 

 report to the legislature. In a few days this appeared, but brought 

 little assurance. It showed: notes discounted, $128,000; loans to 

 individuals, $29,000; specie, $33,000; besides a few other small 

 items. On the other side of the account were: notes in circulation, 

 $13,000; branch bank notes in circulation, $167,000; United States 

 deposits (specie), $215,357. Elias Boudinot was cashier, Nathaniel 

 Ewing, president, and Judge Benjamin Parke, agent of the "Steam 

 Mill". The report indicated that the Bank was on the edge of 

 bankruptcy, and before the people could realize it the crash came. 

 On Tuesday, Jan. 2, 1821, the Bank suspended specie payment. 

 Following close on this announcement, came a similar one that the 

 Bank of Kentucky had failed, with $923,000 on deposit and 

 $1,833,000 notes in circulation. To meet these liabilities it had 

 less than $700,000 in resources. 



Meanwhile Governor Jennings was asked b}^ the legislature to 

 make personal investigation of the Indiana Bank, but found con- 

 venient excuses in the rush of business connected with his office, 

 and also on account of the difficulty of travel. An investigating 

 committee of the legislature reported that Governor Jennings had 

 placed $5,000 of the three per cent fund, intended for the Jeffersonville 

 Canal, in the bank at Corydon, and it was probably lost. Other- 

 wise the report was very favorable, so far as the Corydon branch 

 was concerned. Only one fact was suspicious, that Benjamin 

 Parke, United States Circuit Judge for the Indiana district, and 

 also agent for the "Steam Mill", had arranged to borrow $10,000 

 from the Vincennes Bank, and credit the loan to the Corydon 

 branch. It seems that when State Treasurer Lane visited Vin- 

 cennes in March, 1820, to pay interest on the state's loan, he had 



" Centinel, December 23. 1820. 



»» Western Sun, December 23, 1820; January 27, 1821; January 6, 1821. 



" Western Sun, January 20, 1821. The Bank of Huntsville, Ala., and the Bank of Edwardsville, 

 ril., had already failed, and on August 17 the Bank of Missouri, at St. Louis, the largest bank in 

 the West, closed its doors. Am. Sta. Pa., Fin,, III, 757. 



