﻿ESARET: STATE BANKING IX INDIANA 



297 



VIII 



CONCLUSION 



The new Bank of the State of Indiana gathered itseh' together 

 after the storm and began to do a careful, conservative banking 

 business. The people soon came to look upon the whole winter 

 campaign as a war among highwaymen, in which, for the moment, 

 the lobbyists had got the upper hand of the Old Bank men. 



Hugh ]McCulloch of Fort Wayne was elected president, and 

 James M. Ray, cashier. Branches were estabhshed at Lima, 

 Laporte, Plymouth, South Bend, Fort Wa3'ne, Lafayette, Logans- 

 port, Indianapolis, Richmond, Connersville, Rushville, Aladison, 

 Jeffersonville, New Albany, Bedford, Vincennes, Terre Haute, 

 Muncie, and Lawrenceburg. The Bank opened with $197,903 

 paid-in capital, and $35,497 in specie, an average for each branch 

 of $10,000 capital and less than $2,000 in specie. It was on a level 

 with the worst ''wildcat" banks in all its essential features save two. 

 Its branches were mutually responsible, and it was in the hands of 

 the most capable business men in Indiana. Its presielent was one 

 of the three or four greatest American financiers. The Bank pros- 

 pered until overwhelmeel by the National Bank system. Under 

 an act of the state legislature of 1865, it closed up its business. 

 Nearly all the branches became National banks. Its last report 

 for the year 1864 shows how the National currency was affecting 

 its circulation. At the close of 1862, it had $5,000,000 in circula- 

 tion, and at the close of 1864 only $1,500,000. 



One of the arguments used by the advocates of the Bank Charter 

 of 1834 was that the eUvidends of the Bank would pay the ordinary 

 expenses of the state. A comparison of the statistics in the appendix 

 will show that the dividends ran low during the decade from 1838 

 to 1848. During a part of this time it had to suspend specie pay- 

 ments and curtail discounts, especially on eastern bills, on which 

 the Bank made most money. The dividends from 1843-5 inclusive 

 ran low, because over $700,000 of the Bank's money was tied up 

 in suspended debts. Again in 1852 the state's expenses ran high, 

 on account of the State Constitutional Convention of 1850. It 

 must also be kept in mind that during this latter period the Bank 

 was piling up in its vaults a surplus of over $1,000,000, besides 

 carrying $300,000 of suspended debt. The cUvielends — after paying 

 interest on the borrowed capital at five per cent — amounted to 

 about $2,000,000 for the twenty-one years. Add to this amount 



