First Banks in Wisconsin. 
165 
was to consist of a central bank and five branches. The approval 
of congress, however, was necessary to ratify this act, and as 
this approval was never given, the State Bank of Wisconsin died 
before it was born. 10 It may be said that had congress given 
approval to this act, a monopoly of banking might have been 
established during the period from 1840-50 in the hands of the 
territorial government of Wisconsin, instead of in the hands of 
a private corporation, namely, the Wisconsin Marine and Fire 
Insurance Company, which took advantage of a much disputed 
clause in its charter in order to assume banking privileges. 
The exigencies of the time called for a strong and secured bank 
of issue and, as so often happened with industrial enterprises in 
the west in the early stages of development, the state of Wis¬ 
consin relinquished control over banking herself only to trans¬ 
fer unwittingly this fruitful charge upon a single corporation 
during the years of her greatest development. 
Although business throughout the country revived slightly in 
1838-9, the weak and crippled condition of the state banks in 
general made them easy victims to the after panic of 1839, 
which was occasioned immediately by the failure of the United 
States Bank of Pennsylvania. This was closed on October 10th 
and it dragged with it nearly all the banks in the South and 
West. Of 850 banks, 343 were closed entirely and 62 in part. * 11 
The only legally authorized bank existing in Wisconsin in 
1839 was the Bank of Mineral Point, and this was again re¬ 
ported by a committee in a sound and solvent condition, 12 al¬ 
though Governor Dodge, in his annual message of that year, 
called attention to its issue of so-called “post notes”—notes pay¬ 
able at an unspecified future date—which issues he characterized 
as “a violation of all judicious banking.” Suspicion was soon 
aroused, however, and it was found that the affairs of the bank 
were being badly managed. 
Meanwhile a bill was introduced into the legislature to adopt 
in toto the NewYork free banking law, which had been in operation 
10 Strong, History of the Territory of Wisconsin, p. 285. 
11 Yon Holst, History of the United States , p. 216, cites note to W. G. 
Sumner, History American Currency , p. 152. 
12 Strong, History Wisconsin Territory, p. 314. 
