REPORT
ON

THE CONDITION
OF THE

BANK OF THE UNITED STATES,
BY THE COMMITTEE OF

INSPECTION AND INVESTIGATION,

Appointed at a Triennial Meeting of the Stockholders, held according to the thirteenth
Article of the eleventh Section of the Charter, at Philadelphia, on the second
of September, 1822, and continued by several adjournments
to the first of October, 1822;

ADOPTED BY THE STOCKHOLDERS.

PHILADELPHIA :
PRINTED BY WILLIAM FRY,

1822.

332.11
B225r

REPORT.

A T a triennial meeting of the Stockholders of the Bank of
the United States, held by adjournment at their Hall in the
City of Philadelphia, on Tuesday the 1st of October, 1822—
THOMAS E L L I C O T T , Esq., in the Chair, and
W I L L I A M MEREDITH, Secretary.
The following Report of the Committee of inspection and investigation, appointed agreeably to the resolution of the Stockholders, at the meeting held on the 2d of September, 1822, having been adopted, it was "Resolved that the Report with its
Appendix be published in the public papers; and that the President and Directors of the Bank of the United States do also
cause the same to be published in pamphlet form, and that a
copy thereof be held at the disposal of each Stockholder."

Your Committee, to whom was referred an examination of the condition of the Bank,
Report,
THAT they have carefully considered and diligently investigated the subject confided to them.
But, before submitting any opinion or statement
in detail, as to its actual situation, they beg leave
to refer to the luminous exposition of the President, hereto appended, containing a fund of information in relation to the Institution in con-

4

nexion with various topics of sound speculation
and practical utility, which cannot fail to prove
highly interesting to the Stockholders and to
the public: while, at the same time, they illustrate the consoling truth that the most appalling
difficulties may be surmounted by the steady application of industry, integrity and talent.
In compliance with the provisions of the 13th
article of the 11th section of the Charter, your
Committee have ascertained that the suspended
debts at the Bank and its various Branches are
Upon personal and other than stock
Dolls.
Cts.
securities,
6,401,255 90
And upon loans secured by pledges of stock 4,017,050 76
Together amounting to

10,418,306 66

Your Committee are decidedly of opinion
that the loss to the Bank upon this debt, together with overdrafts, counterfeit checks, and from
all other sources, cannot exceed 3,743,899 dollars, a loss arising partly from the peculiar situation of the monied relations of the country, but
principally from a misplaced confidence in unworthy agents. But your Committee feel gratified in saying that a fund more than sufficient
has been derived from the previous profits of
the Bank, and specifically pledged, and set apart
to meet this loss; besides which it possesses a
surplus of 971,425 dollars 41 cents, arising from

5

a balance which stood to the credit of the profit
and loss account on the 1st of July last, from
interest which has actually accrued, but which
has not yet been paid, upon that portion of the
suspended debts which it is confidently believed
will be ultimately obtained, and from the advance above par upon 37,954 shares United
States Bank stock, held by the Bank, estimated
as worth four dollars per share above the par
value.
The preceding facts, with the following analysis, your Committee feel assured will render
the conviction irresistible, that the Bank of the
United States has now arrived at that point
when its capital may be declared to be sound
and entire, while it possesses contingent interests
of nearly one million of dollars, to be applied
to such objects as the future administrators of
its affairs may deem adviseable.
DR. Bank of the United States, to Stockholders for Capital paid in
The sum paid but not yet extinguished for
Bonus, premium on four millions of 5 per cent.
Government Stock, and for Banking Houses,
provided for and to be extinguished by the semiannual appropriation of 60,000 dollars,
Estimate of all the losses of the Bank, up to
the present period,
Balance,
. . . . . -

Dolls. Cls.
34,992,139 63

2,015,802 15
3,743,899 00
971,425 41
41,723,266 19

6
CR. Bank of the United States, by Capital
paid in,
The sum which has been paid on Bonus, premium on four millions 5 per cent. Government
Stock and Banking Houses, and which will be
extinguished by a semi-annual appropriation of
60,000-dollars,
1,620,000
Value of Banking Houses which have cost
834,922 dollars 15 cents, but which at the expiration of the charter, will not then stand on the
books of the Bank at a value more than
Contingent Fund of 3,550,000 dollars, which
will be increased by the transfer of 193,899 dollars from the balance of the profit and loss account as it stood on the 1st July last, to cover
the losses sustained,
The balance that will remain of what appeared to the credit of the profit and loss account
on the 1st of July, after having transferred to
Contingent Fund, 193,899 dollars,
The interest which has accrued
on suspended debts amounting to 1,279,520 54
After deducting interest on that
portion which is deemed bad of
511,808 20

Dolls. Cts.
34,992,139 63

00

395,802 15

3,743,899 00

51,897 07

767,712 34
Advance above par on 37,954 shares Stock of
the Bank ot the United States, which it holds—
say four dollars per share,
-

151,816 00
41,723,266 19

In addition to the above, the Committee deem
it proper to exhibit the following brief view of
the present actual situation of the funds of the
Bank, and of their distribution:—

7
Dolls. Cts.
The Capital of the Bank paid in is
34,992,139
63
The circulation of Bank Notes, amounts to
5,456,891 90
The deposits are
6,776,492 74
Unclaimed Dividends,
129,741 28
Amount due to sundry Banks, in current account,
and to individuals in Europe,
1,964,898 36
Fund reserved to cover the losses sustained by
the Bank,
3,743,899 00
Profit and loss account, after having transferred
to Contingent Fund 193,899 dollars,
51,897 07
Interest, Discounts, &c. received from 1st July
to
September,
388,237 01
The total amount of Funds, are

-

-

--53,504,196 99

Which are distributed as follows:
In United States 5 per cent Stock,
United States 6 per cent. Stock, Loans on personal security,
Loans secured by Bank Stock, Loans secured by Mortgage, Due by State Banks, bearing interest,
Real Estate taken for debt, part of which is
productive,
Amount due by sundry State Banks, &c. in
current account,
Paid on account of Bonus, and premium on 5
per cent. Stock,
Banking House in Philadelphia and Branches
cost
Notes of State Banks on hand,
Specie in United States Bank and Branches,

11,000,000
2,020,469
26,236,150
5,974,725
8,000
739,918

00
27
88
80
00
76

587,102 38
910,950 97
1,180,880 00
834,922 15
664,642 56
3,346,434 22
53,504,196 99

It might be deemed prudent to abstain from
expressing an opinion upon the future prospects

8

of the Bank, leaving each individual to draw his
own inferences from the facts exhibited; yet
your Committee are unwilling to omit the expression of what they believe to be a well grounded hope that the profits of the Bank and its
public utility will continue to increase with the
gradual development of its resources. If the
Bank has, under the embarrassment and perplexity in: which it has been placed, not only
sustained its own credit, but that of the circulating medium of the country, with which its interest and prosperity are indissolubly connected,
it can scarcely be doubted that these difficulties
being surmounted, and a more ample field
opened for the exercise of its energies, an increase of profit will result from a corresponding
extension of its business. And whilst your Committee have found it impracticable to view this
Institution, in any other light, than as an establishment to effect great national objects, they have
been compelled to remark that, though those
objects have been most fully attained, the Institution itself has not received the support, which
it is clearly the interest of the nation to afford.
The past history of the Bank has proved that,
where a sense of moral obligation is wanting,
the existing laws are inadequate to deter the
agents of the Bank from the commission of

9

frauds upon its vaults, Your Committee therefore advise that the President and Directors present to Congress a respectful memorial, praying—1st, The enactment of efficacious laws,
that adequate punishments may be inflicted upon
such agents of the Bank as may be guilty of
malversation in office. 2dly, That they ask an
alteration in that part of the charter which requires that all the notes of the Bank which are
payable on demand shall be received in payment
of debts due to the Government, inasmuch as
this requisition, as heretofore construed, has not
only the tendency to prevent the Bank from re*
storing to some sections of the country a sound
circulating medium, but it may occur that the
Bank cannot safely place to the credit of the
Government, in cash, notes at one office, which,
according to the contract on the face of them5
are payable at a different and distant office
alone, and where only funds have been placed
for their redemption.
Though your Committee are aware, that not
only the convenience of the public but the interest of the Institution require an additional emission of its notes, and although they believe, that
with a reasonable degree of exertion on the part
of the cashier, these may be executed and put
in circulation, while the business of the Bank is
B

10

confined to its present limit; yet they are satisfied that a considerable extension of the ordinary business of the Institution, would render
it wholly impossible for its officers to perform
.this service: it is therefore respectfully suggested, that Congress be prayed also to pass a law,
authorizing other agents of the Bank to sign its
notes, and in the mean time the Committee recommend that the best means in the power of
the President and Directors be taken, to put in
circulation a large additional amount of notes,
not exceeding the denomination of twenty dollars.
Your Committee have not discovered that
any serious consequences have resulted to the
interests of the Bank (except those which have
been followed by a public exposure,) from a
want of obedience in distant agents; they nevertheless deem it proper to advise, that the President and Directors of the Parent Bank keep
steadily in view the absolute necessity of enforcing its own orders through all the various
departments of the Institution; without which*
neither harmony can be expected in its administration, nor security to the interests of its stockholders.
Your Committee feel much gratification in

11

being able to state, that the current expenses of
the Bank have been essentially reduced since
the year 1819, and while it might be supposed
that the present embarrassed state of the commerce of the country, and the limited amount
of interest heretofore divided upon the capital
of the Bank, are strong admonitions to your
agents to observe the most rigid economy; yet,
inasmuch as the splendid edifice in which you
are assembled is now so nearly completed, they
cannot but recommend that it be finished, provided the expense shall not exceed 25,000 dollars.
In taking into view the business of the Bank
as connected with its different offices, the Committee think it right to recommend to the continued attention of the President and Directors
the necessity of withdrawing those Branches
which are found to be unprofitable, and transferring their funds to those offices which shall
seem to require additional capital.
Your Committee take great pleasure in
unanimously declaring that the circumstances
of the Bank fully realize the anticipations of the
Stockholders as expressed at their last meeting^
in regard to the President, who, by his talents,
disinterestedness, and assiduity, has placed its

12
affairs in an attitude so safe and prosperous, as
that the burthen of duty devolving upon his
successor will be comparatively light,
THOS. ELLICOTT,
Chairman of the Committee of Inspection
and Investigation.
Bank of the United States,
October 1st, 1822,

EXPOSITION.

T H E Stockholders generally have never had any view of the
progress of the Bank submitted to them. At the triennial meeting in 1819, it was my intention to have given them such a view.
I was, however, advised that it would be more expedient to reserve the communication for a committee, and my opinion was
cheerfully surrendered. But as it is my determination in a few
months to quit the station with which you have honoured me, and
as my silence on a former occasion has kept you, as well as the
public, in a great measure ignorant of the difficulties in which
I found the Bank, and has subjected the administration, of which
I have been a member, to censures which were unfounded, and
which have fallen in many instances, from the lips of the very
persons who were the authors of the errors and mismanagements,
to use no harsher language, by which this Institution was
brought to the verge of bankruptcy and ruin, I will now present to you a short view of the progress ajid present state of
the Bank. You will probably raise a committee of inspection and
investigation, and as far as any facts or circumstances which I
shall present, may b« deemed material, their accuracy or error
may be ascertained.
The Institution commenced active Banking operations about
the 1st of January 1817, and in the course of that year established eighteen Branches, being all that have been established.
One was projected at Augusta, but on reconsideration was abandoned. The Report of the Committee of Congress made in
December 1818, has made you fully acquainted with so many
of the leading details of the previous management, and the lapse
©f time has made them so much less interesting than they would
have been at an earlier day, that I mean to do little more, in
relation to the period which preceded 1819, than present the

14
rjesults as they will be exhibited in the state of the Bank, when
I came into it.
The Bank, immediately on its commencement, did a very
extensive business, imported vast sums of specie, paid its notes
and those of the Offices, withoutjreference to the places where they
were payable, at the Bank, and all the principal Offices north of
the Potomac, while they were, under the charter, necessarily
received every where in the payment of debts to the Government of the United States; and drafts were given without
limit, on the Parent Bank and northern Offices by the western
Offices, at par or at a premium merely nominal.—As soon as
the notes of the southern and western Offices were paid or received by the Bank and northern Offices, they were returned to them
and re-issued in perpetual succession. An accompanying exhibit
(1) will show the enormous amount of the notes of southern and
western Offices which became chargeable on the Bank, directly,
and, indirectly, through the northern Offices. The result was
that the Bank and the great northern Offices were drained of
their capital, and on the twentieth of July 1818, only eighteen
months after the Institution began its operations, it was obliged
to commence a rapid and heavy curtailment of the business of
the Bank and its Offices. During all this time it had the advantage of immense government deposits. At the moment these
curtailments were ordered, the government deposits in the Bank
and it£ Branches, including the deposits of public officers,
amounted to eight millions of dollars, (a) and they had been
larger at preceding periods. Curtailments were ordered,
from time to time, at the southern and western Offices, to the
amount of seven millions of dollars, and at the Parent Bank to
the amount of two millions, though at the latter they were
made to the amount of 3,600,000 dollars, and upwards, between
the 30th July, 1818, and the 1st April, 1819. No curtailments
were ordered at the Offices of New York and Boston, because
there was no room for them, yet necessity obliged them to reduce their business very much. The curtailments at all points
within the above-mentioned .dates, (b) being eight months, were
6,530,159 dollars 49 cents. Yet after these immense and rapid
(a) See the Monthly Statements, of the 6th andoOth July, 1818.
(b) I refer to the Monthly Statements of the 30th July, 1818, and Is?
April, 1819.

15
curtailments, the most sensible and vital points (Philadelphia,
New York and Boston) were infinitely in worse condition than
when the remedy was devised.
An accompanying exhibit (2) will show the distribution of
capital at the close of this period. At that moment the discount line of the important Office at Boston was only 94,584
dollars 37 cents. And when in this wretched state, the southern and western circulation was1 pouring in upon these weak
points, and the Government at liberty, according to the practice of the time, to draw on either Office or the Bank for the
gross amount of its deposits, throughout the whole establishment, whether south, north, east or west. The southern and
western Offices were not restrained from issuing their notes.,
which they did most profusely* The curtailments in many instances resulted merely in a change of debts, bearing interest
for debts due by local banks, or the notes of local banks, on
neither of which was interest received. The western Offices
curtailed their discounted paper, but they purchased what were
called Race Horse Bills, to a greater amount than their curtail*
ments. The Bank itself continued during the whole period, to
purchase and collect drafts on the southern and even western
Offices, though almost the whole active capital already lay in
these quarters of the Union, and though the great object of the
curtailments was to draw funds from these points. The debt
due in Kentucky and Ohio, instead of being reduced, was within this period actually increased upwards of half a million of
dollars. An accompanying exhibit (3) will show, that instead
of getting relief from the southern and western Offices generally, where curtailments had been ordered, the Bank was stii!
further exhausted by the intervening operations.
At the commencement of this period, (a period commencing
with the order for curtailments, and ending March, 1819) the
Bank was indebted to Baring, Brothers & Co., Reed, Irving &
Co., Adams, Robertson & Co., and Thomas Wilson & Co. the
sum of 1,586,345 dollars 47 cents, growing principally, if not
entirelyx out of its specie operations. Of this sum the greater
part was paid during this period. It had, however, contracted
new debts with Baring, Brothers Sc Co. and Thomas Wilson
& Co., of which there remained due, including any balance
which mav have been due on the former account*, the stim of

16
876,648 dollars; and within the same period it had disposed of
3,270,926 dollars 65 cents of its funded debt, furnishing, by
these compound operations, ways and means, in addition to its
curtailments, to the amount of 1,561,229 dollars 13 cents, and
making with these curtailments, a reduction in the productive
capital of the Bank, within the period of eight months, of eight
millions of dollars and upwards.
At the close of this period the discounts on personal security
at Philadelphia, had been so long the subject of curtailment,
that but a small portion of them admitted of further reduction,
and, after great efforts, a rule had been established to reduce
the discounts which had been granted on the stock of the Bank
at the the rate of five per cent every 60 days. These latter
constituted the bulk of the discounted paper, and so small a reduction afforded no material relief against a great and immediate demand. Even this small reduction was the subject of
loud, angry, and constant remonstrances among the borrowers,
who claimed the privileges and the favour which they contended were due to stockholders, and sometimes succeeded in communicating their sympathies to the Board. All the funded
debt which was saleable had been disposed of, and the proceeds
exhausted. The specie in the vaults at the close of the day on
the 1st of April 1819, was only 126,745 dollars 28 cents, and
the Bank owed to the city banks, deducting balances due to it,
an aggregate balance of 79,125 dollars 99 cents.
It is true there were in the Mint 267,978 dollars 9 cents,
and in transitu from Kentucky and Ohio overland, 250,000
dollars; but the Treasury dividends were payable on that day
to the amount of near 500,000 dollars, and there remained, at
the close of the day more than one half of the sum subject to
draft, and the greater part evqn of the sum which had beeu
drawn during the day, remained a charge upon the Bank in
the shape of temporary deposits, which were almost immediately withdrawn. Accordingly, on the 12th of the same month,
the Bank had in its vaults but 71,522 dollars 47 cents, and
owed to the City Banks a balance of 196,418 dollars 66 cents;
exceeding the specie in its vaults 124,895 dollars 19 cents. It
must again be remarked, that it had yet the sum before mentioned in the Mint, as well as the sum in transitu from Ohio and
Kentucky—this last sum (250,000 dollars) arrived very sea-

17
sonably on the next day or a day or two thereafter. The bank
in this situation, the office at New York was little better, and
the office at Boston a great deal worse. At the same time the
Bank owed to Baring, Brothers & Co. and Thomas Wilson &
Co. nearly 900,000 dollars, which it was bound to pay immediately, and which was equivalent to a charge upon its vaults
to that amount. It had, including the notes of the offices, a circulation of six millions of dollars to meet, to which were to be
added the demands of depositors, public and private, at a time
too when the scarcity of money called forth every disposable
dollar, and therefore created demands upon the Bank for an
unusual portion of the ordinary deposits and circulation.
The sums which were collected daily on account of the revenue, in branch paper, were demandable the next day in Philadelphia, and, at the same time, at every office of the establishment, at the discretion of the officers of the government. The
revenue was principally paid in Branch paper, as well at Boston and New York as at Philadelphia, and while the duties
were thus paid at one compter, in Branch paper, the debentures,
which amounted to one million of dollars every three months,
were demanded and paid at the other, in specie or its equiva1 ent,—money of the place. Many additional details, increasing
the difficulties of the moment, might be added. The Southern
Offices were remitting tardily, and the Western not at all. All
the resources of the Bank would not have sustained it in this
course and mode of business another month ! ! Such was the
prostrate state of the Bank of the nation, which had only twenty-seven months before commenced business with an untrammelled active capital of twenty-eight millions of dollars.
But it would have been fortunate for the Institution if its
danger had ceased here. There still remained in some of the
trusts of the Bank some of the men who had contributed most
to involve it in this state of things. As I must be brief, and
the subject is very extensive, I will advert only to the principal
instance of the misfortune and profligacy to which I allude.
In the Office at Baltimore of which James A. Buchanan was
President, and J. W . M*Culloh was Cashier, there were near
three millions of dollars discounted or appropriated, without
any authority, and without the knowledge of the board of the
Office, or that of the Parent Bank J S. Smith and Buchanan? of
C

18
which firm J. A. Buchanan was a member, James W . M'Culloh and George Williams, (the latter a member of the Parent
Board by the appointment of the government,) had obtained, of
the Parent Bank, discounts, in the regular and accustomed manner, to the amount of 1,957,700 dollars, on a pledge of 18,290
shares stock of the Bank. These men, without the knowledge
of either board, and contrary to the resolves and orders of the
Parent Bank, took out of the Office at Baltimore, under the
pretence of securing it by pledging the surplus value of the
stock, already pledged at the Parent Bank for its par value and
more, and other like surplusses over which the Bank had no
controul, the sum of 1,540,000 dollars: this formed a part of the
sum before stated to have been discounted by the President
and Cashier of the office without authority. When this stupendous fraud was discovered, attempts were immediately
made to obtain security, and it was obtained nominally to the
amount of 900,000 dollars. It was probably really worth
500,000. For this the Bank is principally indebted to the good
management of Messrs. Oliver, Hoffman and M'Kim, of Baltimore, who were at the time members of the Parent Board.
The losses sustained at the office at Baltimore alone, the
great mass of which grew out of this fraud and others closely
connected with it, have been estimated at the immense sum of
1,671,221 dollars, 87 cents. The aggregate of the losses of the
Institution, growing out of the operations which preceded the
6th March, 1819, exceed considerably 3,500,000 dollars. The
dividends, during the same time, amount to 4,410,000. Of this
sum, 1,348,558 dollars 98 cents were received as the interest
on the public debt held by the Bank, which leaves, as the entire profits on all the operations of banking, the sum of 3,061,441
dollars 2 cents, which is less, by at least half a million of dollars, than the losses sustained on the same business!!
When I was invited, and consented to fill the station I now
hold, (4) I was alike ignorant and unapprehensive of the situation in which I have just described the Bank (truly, I believe,)
to have been. I was at the moment remotely situated from the
scenes of its active business, and its important transactions. I
had held, it is true, shortly before, to oblige my friends, a place
in the board of the office at Charleston, at which I occasionally
attended, and from what I saw there, as well as from the pub

19
lie facts concerning the transactions of the Bank, I was satisfied that there was a great want of financial talent in the management of it. But I had not the faintest idea that its power had
been so completely prostrated, or that it had been thus unfortunately managed or grossly defrauded * I never imagined that
when it had, at so much expense and loss, imported so many
millions of specie, they had been entirely exhausted and were
not yet paid for ; nor that the Bank was on the point of stopping payment. It was not until the moment I was about to
commence my journey to Philadelphia, that I was apprized by
a letter (5) from a friend, who had been a member of the preceding board, that he feared, in a few months, the Bank would
be obliged to stop payment.
This was, indeed, appalling news. When I reached Washington, I received hourly proofs of the probability of this event,
fn Philadelphia it was generally expected. My memory deceives me much if I found any one in or out of the Bank, who entertained a sanguine belief of its being able to sustain its payments much longer. On the contrary there was (I think it cannot be forgotten) a public and general expectation that the nation was about to suffer the calamity of a currency composed
entirely of irredeemable paper. The evil which thus threatened the country, is not at all to be compared with a suspension
of a sound currency in times of war and great national emergencies. The former can only be conceived by a people who
have suffered under a paper currency in profound peace. What
a train of evils does it produce ? The destruction of public and
private credit, the national torpor, the individual ruin, the disgraceful legislation and the prostration of the morals of the
people, of which you may discover within your own territories,
some examples, will give you some but yet a faint idea of the
calamity which was about to fall on the country.
On the Bank it must have brought inevitable ruin, for if it
had failed, from its own mismanagement, to serve the great
purpose for which it was just before established—that of restoring and preserving the soundness of the currency—there is no
doubt that the hostility which its great and habitual public usefulness cannot now appease, would have overwhelmed it. Indeed i t would have had no claim on the sympathy or the justice
of the government, and would have suffered a merited fate, No

20
exertions and no sacrifices were therefore too great to avert
this calamity. It was not to be accomplished without sacrifices :
But they have been small, and infinitely less than was expected.
Thus stood the Bank at the organization of the present administration. I was elected and took my seat as President of
the Board on the 6th March 1819. But some time of course
was necessary to look into the state of the Bank before measures of relief could be projected. Its danger, however, was
too manifest, and too pressing to allow much time for this purpose. The principal errors which produced the danger were
fortunately of easy discovery, and to them the proper remedy was immediately applied. The southern and western
Offices were immediately directed not to issue their notes, and
the Bank ceased to purchase and collect exchange on the south
and west. A special meeting of the Board was called, which
the non-resident Directors were summoned to attend for the 9th
April (the next month) and a correspondence with the Secretary of the Treasury was commenced, entreating his forbearance
and his aid, to which I beg leave to refer. (6) To thia officer I
should be ungrateful and unjust, if I were not publicly to a c knowledge my obligations and those of the Bank, for the
countenance and support which he afforded to both in this
struggle.
At the meeting of the Directors on the 9th April, which was
very full, the state of the Bank was submitted to them, a select committee appointed, to whom the subject of its difficulties
was referred, and after very mature deliberation that committee made a Report which was unanimously agreed to. The
principal means of relief proposed and agreed to were:
1. To continue the curtailments previously ordered. 2. To
forbid the Offices to the south and west to issue their notes
when the exchanges were against them. 3. To collect the balances due by local Banks to the Offices. 4. To claim of the
Government the time necessary to transfer funds from the Offices where money was collected to those where it was to be disbursed, as well as like time (until the difficulties of the Bank
were removed) to transfer funds to meet the notes of Offices
paid in the Bank or other Offices than those where they were
payable according to their tenor. 5. To pay debentures in

21
the same money in which the duties, on which the debentures
were secured, had been paid. 6. To obtain a loan in Europe
for a sum not exceeding 2,500,000 dollars, for a period not exceeding three years.
These measures, simple and obvious as they are, and some of
them so strangely overlooked so long, lifted the Bank in the
short space of seventy days (from 6 March to 17 May) from the
extreme prostration which has been described, to a state of safety and even in some degree of power, enabled it to cease its
curtailments, except at points where it had an excess of capital, to defy all attacks upon it, and to sustain other institutions
which wanted aid and were ascertained to be solvent; above
all, to establish the soundness of the currency which had just
before been deemed hopeless; and in a single season of business
(the first) to give to every Office as much capital as it could advantageously employ. There are two of the measures thus adopted, on which I will enter into some detail, because they have
been misconceived and misrepresented.
1. The curtailments. The immense curtailments which had
been made before the present administration of the Bank was
organized, have been stated. The public has been led to
believe that these curtailments were made by this administration, and were the fruit of a policy which originated with it.
Men who sat at the Board and knew the contrary, or, which
is little better, without taking the trouble to ascertain a fact
which was so easily within their reach, have consented to propagate this slander.
I now state, and defy contradiction, and am ready to prove
that no curtailment has been ordered from the time I took my seat,
until this day.
That any curtailments which have been made by the adminis
tration of which I have been a member, were made under orders
which I found in force;—that the Bank at Philadelphia contitinued to curtail only seventy days after I took my seat, that the
Offices of New York and Boston were only required to sustain
themselves, according to circumstances, until the scattered funds
of the Institution could be collected to give them capital;
and further that the greatest reduction of the discounts of the
Bank itself, and all the Offices north of Philadelphia, together,
at no one time exceeded 400,000 dollars', until they were re

22
duced by a want of demand for money which was general
through the nation. When this want of demand for money
prevented the profitable employment of the funds of the Bank,
the only expedient to relieve it from the losses of unemployed
capital which existed, was promptly and successfully employed,
by purchasing of the Government of the United States, first two
millions of six per cent, stock, redeemable at the pleasure of the
Government, and afterwards four millions of five per cent, stock,
redeemable in 1835, on terms which were then deemed highly
advantageous to the Bank, and which are so still, as shall be
hereafter proved.
It is believed that a candid and dispassionate investigation of
the facts will show that, with the same means and under the
same circumstances, no change of proceeding or policy could
have increased the profits of the Bank, (7) and that if the interest which has accrued on the heavy amount of suspended debt
and not been received (and that it has not been received, is not
the fault of the present administration, which did not grant the
loans on which the interest accrued) be added to the dividends
made and the accumulations reserved, the gains will be within
less than a half per cent, per annum of the nominal profits of the
preceding period, in which every thing was hazarded, and more
actually lost than all that was thus nominally gained. I should
have had no disposition to make these comparisons had they
not been made necessary by false statements and representations
of the same facts. In looking at these results, let it also be recollected what different circumstances characterized the different periods.
£. The other measure which I mean particularly to notice is
the loan which was obtained in Europe. There was at the
time this loan was projected great embarrassment in all the concerns of commerce, but the pressing difficulty was a real unsoundness in the Bank circulation which constituted the whole
currency of the country. The weakness of the Bank of the
United States, has been exposed. That of the State Banks was
probably greater, though they were not subject to so many and
such complicated dangers. The revenue was accumulating to
the credit of the government, at various points, in paper that if
immediately pressed upon the banks which issued it would not
have been honoured; and yet to have discredited it suddenly

23
would have forced the crisis of the unsoundness of all the Bank
circulation at a moment when it had no recuperative faculty,
and must have ended in consequences alike disastrous to the
Bank and the country. On the other hand to have imposed no
pressure upon these banks would have been to cherish and perpetuate and increase the evil of an unsound currency. The
course to be pursued by this Bank was a subject of great delicacy and difficulty. The situation of the country was exceedingly alarming.
It was not the present evil that was dreaded—the country
was in its money concerns in an extreme state of exhaustion.
It was drained of its specie in the preceding year before the
first instalment of the Louisiana stock became payable. The
sum necessary to make the payment stood to the credit of the
Treasury in the Bank and was transferred to the credit of the
holders of this stock. The agent of Baring, Brothers & Co. had
for foreign account, at one moment, 2,410,000 dollars at his credit at the Bank in Philadelphia, and on the same day all the
specie in the Bank and all its Offices did not amount to as
much. It was impossible to have paid it, and the Bank was
obliged to enter into a contract to pay it in England by a given
time, with interest. In executing this contract it employed the
whole operations of the next season of business in foreign exchanges, and paid a very large amount of interest; and at the
time this loan was projected there remained a large balance due
to Baring, Brothers & Co. on account of this contract. The
country had been still further divested of its metallic basis in
the interim, and a pretence was only wanting by too many individuals and banking institutions to stop payment. To them it
might have afforded immediate relief and profit. But to the Bank
of the United States it must, as already shown, have caused
inevitable ruin. At every hazard it was obliged to continue its
payments. Its ability to do so, depended on sustaining the credit
of the country, and restoring the soundness of the currency.
If its own vaults had been better replenished than they were, it
could not have relied upon them alone. The ability of this Bank
to sustain its credit at no time depends solely or principally on
the specie in its own vaults: but on the general credit of the
country sustained by the usual legal and moral obligationsdestroy these practically, and all its power becomes feebleness*

24
Thus it has, at any given moment, from twenty to thirty millions of dollars becoming due to it within ninety days, besides
very large sums standing in balances against other banks, and
further sums in the notes of other banks. Now, suppose at any
moment, that a state of things should arise which should destroy
the general credit of the country, and disable debtors, who in
their turn depend on the same means for their ability to pay,
to comply with the first, and tempt them to disregard the last
of these obligations, what would be then the situation of the
Bank of the United States? Yet that state of things was on the
point of taking place, when the loan in question was projected.
The country could bear no further exhaustion, however small,
imtil it had a season to recover. But the second instalment of
the Louisiana Stock, was to be paid in a few months; and the
sum to be withdrawn by foreigners, exceeded probably all the
specie in the two great cities of Philadelphia and New York,
The Bank would have been bound to pay it, had it received the
local paper in payment of the revenue; and if it had refused it,
we have seen the disastrous consequences to which it would
have led. I t was a payment which the country could not, at the
time, bear, and the ability of the Bank was necessarily limited
by the ability of the country. Hence, in a general view, the necessity and expediency of the loan.
It has, I understand, been said, that events have proved that
the loan was unnecessary, regarding merely the direct obligations of the Bank. This is an objection which no mind capable of comprehending the just policy of a national bank could
make, if the foregoing views be correct. But it is not true. Events
on the contrary proved it was indispensable. What would the
situation of the Bank have been, if in October, 1819, upwards
of two millions of dollars had been, in this section of the Union,
where it was payable, drawn from its vaults ? Although they
had been by that day considerably strengthened, yet all the
specie in the Bank, and all the offices on this side the Potomac,
could not have met the draft! Will it be said, that the Government had not, at the time this instalment was payable, a sufficient deposit to make the payment? It is true, because the
Government, as soon as it was discovered that the public credit
would not be made to suffer, disbursed the monies which must
have been and would have been reserved for this purpose; and

25
thus the Bank and the community generally were relieved from
the foreign drain upon them, in the manner in which the relief
was originally projected.
Again—the burthen of this loan has been greatly misrepresented. It has been supposed that in consequence of the subsequent want of demand for money, which prevented the Bank
from fully employing its capital, the interest paid on this
loan was a loss to the Bank. This might be admitted, and
still the loan was not the less necessary. A sacrifice of gain
was expected and intended. But the fact is not so. Although
undoubtedly there was a long period during which the capital
of the Bank was not fully employed, yet it so happened, that
the specific money derived from this loan was employed, and
has not ceased to bring in six per cent per annum from that
day to this. Without it the Bank could not have taken the
Government loan of two millions of dollars in 1820, which remains yet unpaid, nor could it have done the profitable business in foreign exchanges which it did in that year, nor have
distributed capitals as early as it did to the northern offices,
which infused into them a new life, nor, could it have sustained ihe character or the usefulness of a National Bank, until it
should have collected by slow and painful means its scattered
capital. I have said so much of the loan, not only because it
is an important circumstance in the management of the Bank,
but also because it is a measure closely connected with the financial history of the country, and on which turned, in a great
measure, the preservation of a sound currency, an event, however unusual it is so to consider it, probably of more importance than any other in the history of the country since the late
peace. In sustaining the Bank a great public purpose was
served, but it cost not an additional cent. Censured though it
may be, I proudly say I suggested and advised this measure,
and am well content to bear the responsibility of it. The loan
was for only two millions of dollars, and was payable on the
5th of July last. One million thereof has been continued at
5 per cent, interest, and the other has been paid off at a profit
which would defray the charge of remitting the remaining million, even at the present adverse rate of exchange.
During the present administration of the Bank, considerable
sums have been drawn from the capital in erecting necessary
D

26
buildings for the use of the institution, considerable burthens,
which were previously created, have been discharged, one million of dollars have been paid on account of the bonus to the
Government for the charter, six millions of funded debt have
been purchased, and are now held by the Bank, three millions
five hundred and fifty thousand dollars have been accumulated
for the purpose of repairing the losses which had been previously sustained, and there now stands to the credit of profit and
loss the sum of 245,796 dollars 7 cents; and there is due to
the Bank 1,279,520 dollars 54 cents, for interest which accrued
before the first of July last, on suspended debts, and which has
not been received.
The losses of the Institution were estimated, at the last meeting of the Stockholders, at three millions of dollars. They
have been found to exceed that sum. The estimates of the
Dividend Committee, in July last, made the aggregate of the
losses 83,743,899. This includes all losses to that time from
whatever cause. A very small portion of these losses, you will
discover, has resulted from the business or management posterior to March, 1819. It is hoped, from the lapse of time, and
the trying circumstances which have intervened, that the losses
have reached their utmost amount. The greatest pains have
been taken to probe the state of all the offices to the bottom, as
the accompanying documents will show. (8)
The western debts, by which are meant those due in the
states of Ohio and Kentucky, have been a subject of peculiar
anxiety and attention. To ascertain the exact state of them,
the Board were not satisfied to rely on the ordinary means, but
dispatched the Cashier of the Bank, who was understood to be
particularly well acquainted with these states, to look into the
situation of the offices in Kentucky and Ohio, and to furnish an
estimate of the probable loss which would be sustained upon
them. His reports which accompany this communication, will
exhibit these results. His estimates very far exceed those of
the committees of the offices; and the Parent Board and the
committees of that Board have been governed by his estimates,
in forming their opinions of the amount of these losses. A number of investigations of particular cases have, in the course of
the current transactions of the Bank, taken place, and, on all
such occasions, his estimates of loss have appeared to be be

27
yond the probable loss, with the exception of the cases of some
local banks at Cincinnati. Doubts, however, of the sufficiency
of these estimates, founded on the fear of the fraudulent disposition of some of the debtors, and the unjust laws of those states
in relation to creditors, were excited—the Board, therefore, in
July 1821, set apart, as an auxiliary fund, in addition to the
contingent fund of 3,550,000 dollars, all excess over the par
value of certain stock pledged and transferred to the Bank, and
all interest due and to grow due on the suspended debts at the
offices in Kentucky, and Ohio, to be with the said " contingent fund" inviolably appropriated to the extinguishment of the
losses of the Bank, unless otherwise ordered or advised by the
stockholders at a triennial meeting or at a regular meeting
which should be called for the purpose.
The course of policy pursued by the Board in relation to
suspended debts, and particularly the debts due in the western
states, was not to press the debtors rigorously where they were
willing to give the best security in their power, and indeed
never to press them except with a view to security.—The most
liberal indulgence therefore has invariably been granted where
satisfactory security or the best in the power of the debtor has
been given. On the 1st April 1819, the sum due to the Bank
in Ohio and Kentucky, including balances due by local banks,
was 6,351,120 dollars, 80 cents; on the 30th August 1822, the
sum due, including also real estate taken in payment, was
5,389,477 dollars 18 cents, being a reduction of 961,653 dollars
62 cents, (a) but in the debt now due, is a considerable sum of
contingent interest which has been liquidated and notes taken
for it, so that the reduction will exceed one million of dollars of
the principal.—Mortgages, and other collateral security deemed
ample have in many cases been obtained, in others valuable
additional security, in others judgments, and suits are pending in all, or nearly all cases in which security has not been
obtained.
The office at Cincinnati was discontinued in September 1820,
and a confidential agent is now employed in winding up its
affairs.—The reasons for discontinuing this office it would be
tedious and perhaps invidious to narrate, they shall be stated
(a) Vide Monthly Statements for 1st April 1819, and 30th August, 1822.

28
to any committee you may appoint. I t has been deemed inexpedient to discontinue any other office.
The several funds which may be relied upon to extinguish
the estimated losses are the following: 1. A contingent fund
of actual profits which have been reserved of three millions five
hundred and fifty thousand dollars. 2. Any excess beyond the
par value of 37,954 shares of the capital stock of the Bank
pledged to it and standing in its corporate name on the books.
Though the debts secured by these shares are only estimated
at par, they give a claim to the Bank which will cover any value
beyond par which the shares may hereafter bear. 3. The sum
of 245,796 dollars 7 cents, now standing to the credit of profit
and loss. 4. The sum of 1,279,520 dollars 54 cents, arrears of
interest due the Bank. It must be remarked that this last sum
includes interest as well on debts estimated as bad and doubtful
as on those deemed good. There is now no charge on the Bank
besides ordinary current charges, except 60,000 dollars semiannually, which will, if applied for the duration of the charter,
extinguish the bonus, the premium on the five per cent, loan,
and about forty per cent, of the cost of banking houses
which have been erected, and of any that in all likelihood will
be hereafter erected, as well as the completion of the building in
which you are assembled; and although I have been opposed
and have even entered my dissent upon the journals, to some of
the acts of the Board in relation to this building, I nevertheless
do advise, as it is so near completion and is so beautiful a specimen of architecture, that it be finished. It never again can be
done at so small an expense, and never under the superintendence of an agent more skilful, faithful, economical and accurate,
than the gentleman who planned and has so far executed it. The
additional expense will be small. (9)
It was expected by the stockholders at their last meeting,
that the Bank would have been enabled to have repaired the
losses which had been sustained, and to have made a dividend in
January, 1820. This the increased estimates of the losses and
the stagnation of trade concurred to prevent, while the same
causes have diminished the amount of the dividends which have
since been made. It will be seen, however, on reference to the
accompanying statement (10) that the Bank would have been
able to have made dividends which would, no doubt, have been

29
satisfactory to the stockholders during the whole period of this
administration, had it not been incumbered as well with the
losses as the various embarrassments which belonged, in their
origin, to a previous period.
The expenses of the Institution very soon attracted the attention of the present administration, but it was not practicable to
reduce them immediately. An accompanying statement (11)
however will show that much has been done towards the accomplishment of this object. The amount is still enormous compared
with the profits growing out of the proper operations of banking ; that is to say the profits of the Bank, exclusive of the
dividends received on the funded debt which it holds and which
require no management or expense in the receipt of them.
The monthly statements of the Bank exhibit an analysis of
the state and current business of the Bank and the several
Offices as perfect as the nature of the subjects will permit: but
if taken without explanations they are often likely to mislead.
No attempt at this time and in this form to give such explanations
in a general way would be admissible or practicable, but all
such will be cheerfully and promptly given in reply to every
inquiry on particular points which may be presented.
You will probably desire to have some notices of the condition of the principal funds in which the capital is invested.
This I will briefly attempt:
I. The Discounted Paper. The current paper of this Bank
and its offices is probably as good, or better, than the current
paper of other banks, in the places respectively where it is due.
There is, however, unfortunately a heavy mass of suspended
paper on which interest is continually accruing, a great part of
which will, no doubt, in time be recovered, but which adds little or nothing at the present time, to the fund from which the
Bank is to divide. There is one portion of this which, independently of the losses already sustained by it, and which are included
in the estimates, I consider as very good and productive. I mean
the forfeited stock consisting of 37,954 shares which may be
considered as a reduction of a capital quite too large, to the
extent of their par value.
II. The Funded Debt held by the Bank. This now consists,
with the exception of a very inconsiderable sum, (1) of seven
millions of five per cent, stock subscribed by the Government;

80
(£) of two millions of six per cent, stock purchased in 1820*
redeemable at the pleasure of the Government; (3) of four millions of five per cent, stock purchased in 1821, and redeemable
.on the 31st of December 1835. The two millions of six per
cent, stock, of the loan of 1820, will, in all likelihood, be speedily redeemed. The four millions of five per cents, are longer
irredeemable than any other stock of the Government of the
United States, and hence probably this stock is more valuable
than any other stock of the Government of the United States.
I t is quoted higher in the London market than the average of
the six per cent, stocks. When the Bank obtained this stock it
was deemed a great bargain. It is now unusually depressed,
from causes which probably cannot be permanent, and some
stockholders who urged the Bank to endeavour to take it at
any price, begin now to doubt whether the Institution were not
better without it. If it were now sold at a profitable rate, as it
may be, the same persons, if it rise, would condemn the sale of
it. Leaving these persons then to the indulgence of their opinions, it may be remarked that the more the Bank can retain
of this stock the better for the Institution. It wants active funds
but for two purposes: Firstly, to pay the loan of 1,000,000 dollars, due in London. And, secondly, to give additional capital
to its Offices. All the Offices south of Philadelphia, I venture to
say, have as much capital as they can use advantageously.
I cannot stop to give my reasons for this opinion. It is doubtful whether more than half a million in addition to its present
funds could be profitably employed at the Parent Bank : more
than an additional million I am satisfied cannot under any circumstances be profitably employed at New York, (a great many
crude suggestions to the contrary notwithstanding): and I doubt
^ whether at this moment a dollar more ought to be added ; though
%l am of opinion that a million ought to be added to the capital
of that Office at a proper time, making the capital 2,500,000
dollars. Half a million added to the capital of the Office at
Boston, making the capital 1,500,000 dollars* will be enough for
that office, All this will be supplied by the redemption of the
two millions 6 per cent, loan, and if a little more be necessary,
it will soon be supplied from the suspended debt. I think, therefore, if the Bank find it necessary topart with a million and a half
of this loan, it ought to do it with regret; but it should on no

81
account part with more. The unextinguished part of the premium of this loan is about 4J per cent., and the last London
quotations are 95 a 96, and the ex change in favour of London 10
to 10^ per cent. It is obvious, therefore, that at the lowest quotations now or at any other time of this stock, it would realize
the cost, in connexion with the rate of exchange, the rise of which
against this country, is supposed to be the principal cause of
the depression of this stock. There is one error in relation to*
this subject which it may be worth explaining.
It is supposed by some, that, because the government of the
United States have not been enabled to convert their six per
cent, stocks into fives, that a five per cent, stock is deemed undesirable abroad: but the government has never offered a stock
like that which the Bank holds in exchange for the sixes. It
has offered a stock redeemable in eight or ten years. The stock
held by the Bank is not redeemable in less than thirteen years and
three months. No stronger proof can be given that the sixes would
be exchanged for such a stock, than the fact that it is quoted
higher than the average of the six per cents, in the London
market.
The Bank, by a resolution of the 28th day of November, 1816,
agreed to remit to the holders of the capital stock of the Bank,
residing in Europe, the dividends which should be declared
thereon, free of expense. This was deemed a very disadvantageous and burthensome engagement on the part of the Bank—•
advice of eminent counsel has been taken, to know whether the
Bank was bound to continue these remittances, and it has been
advised that it was not bound longer than it should desire to
do so from its own views of expediency or advantage. It was
determined therefore to discontinue this agency except as to
those who had made regular requisitions or who should do so by
a given day. As to these it was thought better that the Bank
should make the sacrifice which these remittances required,
than incur the suspicion of having misled the holders of stock
who had made the requisition, perhaps, under the impression,
that the regulation was not disadvantageous to the Bank, and
that it would be permanent; as to all others there was no pre*
tence of claim. There is one case of 3540 shares which is un~
der consideration, which the Bank has heretofore determined
not to be entitled to this privilege, but the parties have urged a

32
reconsideration of it. If this be embraced the number of shares
on which the Bank has determined to continue remittances,
will be 15,330 shares. If they be excluded the number will be
11,790 shares.
With these facts, and an inspection of the documents which
are referred to .and ready to be exhibited, the Stockholders will
be able to form an opinion for themselves, with all the lights
and information which I have or of which the subject is susceptible, of the state of the Bank, and may offer their advice and
express their opinions accordingly.
L A N G D O N CHEVES,
Pres. Bank U. S.

"Bank United States, Sept. 25, 1822.
The Committee of Inspection and Investigation appointed
in pursuance of a resolution adopted at the meeting of the stockholders, met agreeably to adjournment. Mr. Cheves continued
the proof of his statements, and closed at 12—when, on motion
of Mr. Hamilton, the following resolution was unanimously
adopted:
" Resolved, That, in the opinion of this committee, Mr. Cheves
has fully and satisfactorily proved the facts detailed in his
statement of the past and present condition of the Bank, submitted by him to the stockholders, on the 2d September, and
now in the possession of this Committee."
a

I do hereby certify that the above is a correct extract from
the minutes of the Committee of Stockholders of the Bank of
the United States, signed by the Chairman and Secretary, and
deposited in this Bank for safe keeping.
J. ANDREWS, Assistant Cashier.
Bank United States, October 17, 1822.

DOCUMENTS.

No. 1.
THE following sums in branch notes, received at the Bank of
the United States, have been disposed of as follows:
Offices.

Portsmouth,
Boston,
Providence,
Middletown,
New York,
Baltimore,
Washington,
Norfolk,
Richmond,
Fayetteviile,
Charleston,
Savannah,
New Orleans,
Louisville,
Lexington,
Cincinnati,
Chillicothe,
Pittsburgh.
8l0,421,556

Returned to
Offices.

25,310
32,575
21,640 !
42,920
373,490
2,111,405
3,467,370
451,550
922,439
301,308
611,799
969,055
420,115
27,550
170,280
198,000
26,000
248,750

Notes of Offi- Notes of Offi- Total reces destroyces on nana deemed at
ed.
parent Bank

100
142,655
570
920
812,330
214,540 !
28,375
13,520
9,610
259,980
128,580
479,440
195,010
222,210
379,500
492,540
227,360
290,790
3,398,030

2,775
3,215
1,780
10,385
29,240
1,730 !
54,885
18,725
16,120
7,190
12,850
11,730
30,040
94,340
84,800
119,010
33,850

41,410
574,075

28,185
178,445
23,990
54,225
1,215,060
2,327,675
3,550,630
483,795
948,169
568,478
753,229
1,460,225
645,165
344,100
634,580
809,550
287,210
580,950
14,893,661

To the foregoing amount of
.
.
.814,893,661 00
There ought to be added this amount of post
notes, issued by the parent Bank and destroyed; because they were used in the
southern and western states, in lieu of
branch notes, .
.
.
.
.
.
5,528,981 96
Amount redeemed, $20,422,642 95

34
The Sum thus redeemed is exclusive of considerable sums in
branch notes received at Offices other than those which issued
them, and which were not returned through the parent Bank,
but directly from the Offices which redeemed them to the Offices
which had issued them.
Bank of the United States, Lee. 7, 1820.
(Signed) JAMES HOUSTON, Ass't Cashier.
No. 2.
Distribution of the capital of the Bank
May 28th, 1819.
Portsmouth,
Providence, .
Middletown,
New York, .
Baltimore,
Washington,
Richmond,
Norfolk,
Fayetteville,
Charleston,
Savannah,
New Orleans,
Lexington,
Cincinnati, .
Louisville,
Chillicothe, .
Pittsburgh,
Philadelphia,
13,418,742 96
Deduct this sum due to Office at Boston,
372,825 79

of the United Stated
g l 17,678
335,208
255,985
245,287
5,646,325
555,737
1,760,502
861,764
677,963
1,935,042
1,420,543
1,664,596
1,502,388
2,400,987
1,129,009
649,858
769,031

70
54
11
81
28
97
88
16
81
35
45
47
44
30
00
83
36

13,045,917 17
834,973,828 63
This statement of the capital at Philadelphia, is merely nominal, if considered as a capital for the proper operations
of banking, as in the above sum are embraced all the property
and debts due the Institution, including therein the 5 per cent,
stock which the government subscribed, debts due by State
Banks, &c* &c.

No. 3.
A statement showing the amount of funds received from and restored to the several Offices (Washington excepted)
which are therein mentioned, between the 30th of July, 1818, and the 1st of April, 1819.
Sterling
Branch
Bills. j notes paid.

Offices.

Curtailments ordered

New Orleans, 500,000
Savannah,
500,000
Charleston,
100,000
Fayetteville,
500,000
Norfolk,
1,200,000
Richmond,
3,000,000
Baltimore,
100,000
Pittsburgh,
300,000
Cincinnati,
100,000
Chillicothe,
200,000
Lexington,
100,000
Louisville,

i
Washington,

Cr.

Dr.

93,000 275,000 1
85,000 1,085,000
249,000 276,000
379,000
145,000 308,000
310,000 587,000
702,000 726,000
240,000 !
132,000 !
42,000 1
334,000
169,000 :

Revenu e paid.

Dr.
112,000
81,000
553,000
70,000

Cr.

Domestic Bills, &c.

Dr.

121,000
95,000 j
258,000
18,000 j
188,000 69,000
324,000 134,000
400,000 731,000
9,000
55,000
335,000
49,000
198,000
7,000
7,000
789,000
10,000

Cr.
576,000
549,000
350,000
153,000
150,000
408,000
775,000
146,000
136,000
135,000
295,000
116,000

Spe cie.

Dr.

Cr.

.

Balance

Tot als.

Dr.

Cr.

j

Dr.

Cr.

150,000 508,000 819,000
50,000 1,261,000 684,000
300,000 1,087,000 899,000
100,000 467,000 253,000
50,000 377,000 533,000
50,000 721,000 1,092,000
100,000 136,000 1,557,000 2,013,000
50,000 304,000 196,000
50,000 516,000 186,000
190,000 247,000 325,000
100,000 341,000 395,000
100,000 966,000 216,000

35

6,600,000 1,584,000 4,553,000 2,147,000 912,000 1,554,000 3,789,000 100,000 1,326,000 8,352,000 7,611,000 741,000
400,000
7,000,000

i

36

No. 4.
COPIES.
Philadelphia, February 4th, 1819.
LANGDON CHEVES, ESQ.
SIR,

The sudden resignation of William Jones, Esq. as President
of the Bank of the United States, made it necessary to go into
an immediate election of a successor, in order to prevent embarrassment to the Bank, and to the Loan Office connected
with it.
Under these circumstances James C. Fisher, Esq. consented
to serve, and was accordingly elected to the office, with a declaration on his part, that he would resign it as soon as a full
meeting of the Board could take place, when the Directors
would be enabled to select another President.
As it is important on various accounts, that the Presidency
should be filled by a gentleman whose continuance in it might
be generally expected, the undersigned, Directors of the Bank
of the United States, do, in this unofficial manner, respectfully
solicit your acceptance of that office.
Unless you were in Philadelphia, your election could not
properly take place; we therefore request, if you accede to our
wishes, that you will please to come on without delay; and do
assure you, that on your arrival it will be promptly effected.
Should it be necessary for you to return to your present place
of residence for a time, you could do so without much inconvenience to the Bank, upon your designating one of the members
of the Board as President pro tern.
We are, respectfully, &c.
(Signed)
JOHN
CONNELLY,
JOSHUA LIPPINCOTT,
GUSTAVUS COLHOUN, JOHN COULTER,
JOSEPH DUGAN,
JOHN LISLE,
DANIEL LAMMOT,
JAMES SCHOTT,
JOHN OLIVER,
HENRY TOLAND,
GEORGE HOFFMAN,
JOHN CONNELL.
JAMES C. FISHER,

37
Office of Discount and Deposit, Baltimore,
February 7th, 1819.
SIR,

I have the honour to enclose an unsealed letter transmitted
to me from the Bank of the United States, with a request that
I would present the same to Mr. Oliver and Mr. Hoffman for
their signatures, and then forward it by mail to you. I have
taken the liberty to annex to the letter a statement, intended
to shew that every director who had the opportunity, has given
his signature, and I have sincere pleasure in transmitting this
strong presumptive proof, that your election will be by an unanimous vote. I also take the liberty to add, that there appears to
be but one sentiment among the stockholders here, which is, to
see you placed at the head of this important but now greatly
suffering institution, with as little delay as may be reconcileable
with your personal concerns.
The difficulties under which the Bank of the United States
has laboured, and the hostility with which it has been assailed,
will have attracted your attention. This spirit of hostility may,
without breach of charity, I presume, be in many instances ascribed to interested motives, and must therefore have its sway;
but the Bank owes it to itself to provide, if it can, for a removal
of those difficulties which arise from defects in some of the provisions of the charter, and from an erroneous construction of
others. It is now contended that all bank notes must be signed
by the President and countersigned by the Cashier. The circulation of the Bank ought to be thirty millions, or rather, this
amount ought to be signed, and I think the denomination should
be about as follows :
40,000
of 100
4,000,000
80,000
of 50
4,000,000
200,000
of 20
4,000,000
800,000
of 10
8,000,000
2,000,000
of 5
10,000,000
3,120,000
30,000,000
I know, by experience, that if a person do nothing else, he
will be sufficiently employed in signing 2,000 notes daily, which
would require five years to furnish the above amount and des-

38
cription of notes. But, occupied as the two principal officers of the
Bank must be, with other and unavoidable duties, I believe it
to be impossible that they can sign more than 1000 daily, and
thus will the Bank be deprived of its principal source of profit.
It is, no doubt, known to you, that a bill providing a remedy for
this evil passed the Senate last year, but was postponed in the
House. W e are endeavouring to have it revived, and if you were
in Washington, I should feel confident of success. Can you, fry
letters to your friends, promote, if you approve of this object,
or can you reach Washington in time to aid the measure ?
Under the fifteenth section of the charter, the Secretary of
the Treasury claims, I am told, the right of passing his checks
upon any point, whether he has money at such particular point
or not; for example, if he have one million of dollars at New
Orleans, and if he have occasion for this sum in Boston, he will
draw on the latter, although he may not have, a dollar there.
May it not be contended on the part of the Bank, that he must
give notice where he wants his funds to be placed; that the Bank
must transmit them at its expense, and that when so placed, but
not before, they may be drawn for ? A contrary practice has, I
understand, produced the following highly injurious result to
the Bank. At points where money means coin, the overdrafts
of the Treasury amount to 1,800,000 dollars, and at places, in
many of which money means any thing but coin, the Treasury
has to its credit 2,500,000 dollars. You will at once perceive
how oppressive this must be to the Bank. It has actually paid
1,800,000 dollars in coin, and has, in remote places, 2,500,000
dollars, of which it can make no present use !
When I took up my pen, it was only my intention to accompany the discharge of the duty assigned to me, with an expression of the gratification which I derived therefrom. The all important subject, however, of obtaining the means to afford an
adequate amount of notes for circulation, has drawn me from
my original purpose, and has subjected you to the perusal of
common place observations, hastily, and therefore, no doubt,
imperfectly expressed. I will hope for an apology in my motives,
and I have the honour to be,
With the greatest respect,
Sir, your obedient servant,
(Signed)
"
J. A. B U C H A N A N , President,
LANGDON CHEVES, ESQ*

89
The question of the right of states to tax the United States
Bank will, it is expected, come on before the Supreme Court at
Washington next week.
Cheves,
Potter,
Bolton,
absent, . . . . . 6
Gracie,
Chauncey,
Sergeant,
Jones,
resigned,
2
Williams,
Public Directors, not appointed, . . 4
Signatures to the letter,
13
25 being the
whole number of Directory

No. 5.
EXTRACT.
Philadelphia, Feb. 1, 1819.
" The chief difficulty, probably, now will be if the Bank cannot continue to pay specie, and consequently incur a liability
to be called upon by its creditors for twelve per cent. per annum
interest. Will the payment of this interest be the greatest evil
to be apprehended ? Will it destroy confidence so much as to
leave the Bank without credit with the public? Of this you can
judge as well as if you were here- We fear there is too much
cause to calculate upon the Bank being placed in this unhappy
situation before many months.
"It is desirable that there should be a head to the Bank as
early as practicable. We wish therefore that you could make
arrangements to come on here without delay, and leave the
moving of your family until it could be done more conveniently
and comfortably than it possibly could be done at this unplea
sant season of the year."

40
No. 6.
(Private and Confidential.)
Philadelphia, 9,0th March, 1819*
SIR,

The situation of the Bank of the United States, at this moment, is in a great degree critical; and it is the more so, because the state institutions are equally or more embarrassed:
and this general embarrassment is increased by the fact, that it
is not peculiar to this continent or the trade of this country.
Europe suffers perhaps equally, and thus each, and particularly
the United States, is deprived of the accustomed resources in
times of difficulty. The mutuality of the suffering and the nature
of the causes which produce it, make it likely to be of some permanency. These causes are more familiar to you than to me, and
your information concerning them much better than mine, it
would therefore be impertinent and useless for me to do more
than allude to them. The Bank ought to contemplate two great
objects, for both of which it is, unhappily, badly prepared.
First, to sustain its specie payments for the present.
Secondly, To reinvigorate itself for future active, profitable
and useful operations.
On the first, your public conduct ha* abundantly shown that
you entertain the opinion, to which I unequivocally and heartily
subscribe, that in the money concerns of the country there can
be neither public nor private safety or prosperity without the
continuance of specie payments, at least by the Bank of the
United States. On the example of this Institution this great
question entirely rests. There is no state bank, south of Boston,
that would not a year ago have abandoned the payment of specie, but for the Bank of the United States, connected with the
determination of the Government not to receive its demands in
the notes of banks which did not pay specie. If this Bank can
continue specie payments, though some and even many of the
state banks should suspend such payments, those which are
sound, as far as the business of the country will enable them to
do a profitable business, will re-establish their means and redeem
their credit. A depreciated currency cannot increase or circulate to any extent in the country while the Government and the

41
Bank of the United States unite in discrediting it. The first b j
refusing it in payment, and the latter by supporting its own
credit; and unless the Bank can support its credit, it would be
very difficult for the Government to get on with its operations
without using a depreciated paper currency, for there would
instantly be no other seen. To the Bank it would be absolute
ruin—it could carry on no business. The bills which it has in
circulation, and all the individual deposits which it has, would
be converted into objects of speculation, with a view to obtain
the interest of 12 per cent, to which it would be liable. It would
be a sure and profitable speculation (the solvency, not to sa}r
prosperity, of the Bank being in all events undoubted) and
therefore it would undoubtedly occur. Its business would be
suspended until it could pay off all it owed and provide unusual
means for a new commencement. Confidence would be impaired, and time (which, considering the limited duration of its
charter, is equivalent to money) would be lost. And, to recur
again to the effects on the country, it would first have an immense unregulated and depreciated paper currency, which
would last till it became intolerable, and then it would have
none at all. Two greater evils cannot be suffered. It is my own
opinion that no sacrifices, however great, should be forborne by
the Bank to sustain a specie circulation, and I believe this would
be the opinion of the Board, if such a question were submitted
to them. All the great efforts of the Bank, and very great they
were, in the importations of specie, have had their operation,
but while they furnished relief to the Bank while it was engaged
in the Herculean efforts which it undertook to equalize the
exchanges, restore a specie circulation, and to put the mass of
the government deposits into sound money, they have left no
resource for present or future support. All the specie in the
vaults of the Bank in Philadelphia, New York and Boston, by
the late statements, amounts only to about 720,000 dollars. Of
this 240,000 dollars are in the Mint, and could not now, and
cannot for some time, serve the purpose of meeting a demand
upon the Bank. The balance of the city banks of Philadelphia
against us is 176,000 dollars and upwards, which leaves but
350,000 dollars, in a shape which could meet demands on the
Bank and its Offices at New York and Boston. The only specie within the control of the Bank is 100,000 dollars, which it
F

42
lias ordered from New Orleans, 250,000 dollar's from the west*
ern Offices, and about 200,000 dollars, which is expected from
Europe; the receipt of all which will be some time delayed, and
is subject to accidents. The relief which we ought to have from
the southern Offices is precarious, and perhaps cannot be realized in time—they urge their inability suddenly to afford it, and
reluctantly yield it. While we are struggling to support the
specie payments* of the north, they answer that the commerce
of their cities will suffer, and that urgency upon their customers will produce great and ruinous failures;—but we are obliged to persevere. Their ability, too, has been turned in another
direction, for all the sterling bills which they have been able to
purchase are necessary to pay for specie formerly imported
and used, and to meet the contract with the Barings for the
payment of the Louisiana stock. W e have sold the remnant of
our six per cents.; we are curtailing something, though slowly,
every day; and yet there is a continual though small drain
upon us for specie and an increase of the late balances of the
State Banks against us, though this also is small. Girard alone
has a balance of near 130,000 dollars. The others together
about 46,000 dollars. At this moment the preparations for the
Asiatic trade are commencing, and will be continued by every
effort which capital or cunning can make or contrive, and
they will continue for some months. The results of new efforts
to procure specie from abroad it is probable would be long delayed, and to engage in them is difficult. W e have no credit
established in Europe but with the Barings, and that for a small
sum. W e already owe them three fourths of a million almost;,
and they are themselves so much pressed at this time, it is understood, that we could not rely*much upon them beyond the
funds we might furnish. It is supposed we might collect some
specie in the Havana, by the sale of bills on England. But to
meet them we must purchase others in the United States, and
we are already in the market for them to a great extent and
with embarrassed means. If we were to get Spanish dollars, the
tardiness or rather inability of the Mint could not recoin them
to meet present wants, and they would be drawn from us for
the Asiatic trade as fast as we could get them in. Under these
circumstances, the first great object of the Bank—the continuance of specie payments—seems to depend on its curtailments,

48
on southern assistance, and lastly such assistance in the modes
of doing business as your department may be enabled and as
you may be pleased to afford. The two first we are attending
to with all our might, and one object of this long epistle, which
I hope you will excuse, is to ask your co-operation in the last
Hitherto the Offices have been able to meet the drafts of the
Treasury with the means which they happened to have at the
time, but as the Bank has so little active ability at this moment,
its dispositions for contingencies must necessarily be very sparing. Large drafts, therefore, on an unprovided point would find
it perhaps unable to pay, and not within reach of protection.
At present the drafts reach their destination frequently before
the Parent Bank knows of their existence. If it were practicable to notify the Bank some time before these warrants were
issued, to transfer funds to meet them, it would remove some
of the embarrassments and much of the uneasiness which the
drafts of the Treasury sometimes occasion both to the Parent
Bank and its Offices.
The operations of this Bank would be calculated with more
certainty, and relied upon with more confidence, if it were ha=
bitually and regularly enabled to ascertain, as long beforehand
as possible, the duties receivable, within given periods of the
year, at the several places of receipt, and if it could obtain general or rough estimates of the probable payments of the government within the year, at the important points of disbursement,
I do not know whether it would be convenient to you in the
business of your department, to direct such information, or
whether you would deem it compatible with your views of propriety and duty. These particulars are therefore thrown out in
the supposition that neither objection may exist.
There are great advantages in executing specie contracts,
where the article is to be derived from the West Indies, particularly the Havana, or the Spanish continental territories, in
having the transportation made in national ships. In looking to
the restoration of the active powers of the Bank, some pretty
large operations of this kind in some way must be contemplated.
Would our government furnish aids in the transportation by
giving a government vessel a direct destination in the case of a
large contract? Would it also, in case government vessels were
likely to touch at Havana, La Vera Cruz, and like places, au^

44
thorize a little delay, and direct their officers to take in smaller
sums which might be provided? Would it indulge inquiries as
to the probability of vessels touching at these places, so as to
give the chance of preparing for their arrival? If these inquiries would not be improper, are there now any vessels which
will speedily come within the objects of these inquiries? It is
believed the British government is in the habit of affording such
facilities even to private enterprize. These inquiries are made
with reference to no particular object or time, but merely to be
possessed of information as to the general means that may possibly be employed in such operations.
The government has the power to redeem in October next, the
balance of the Louisiana debt, but I believe it cannot redeem
less than three millions. It would be very important to confide,
as far as you may think it safe and proper, your views on this
subject to the Bank, It is an event which ought to be met by
previous preparation—I mean in the course of the business of
the Bank. The last payment now ties up the hands of this Insti
tution. If the demand had been made directly upon its vaults,
it being for foreign account, it must have declared its inability
to answer it. You are perhaps not informed, that by an agreement of the Bank and the Barings, two and a half millions of
it are paid and are payable in Europe. This made it practicable
though very burthensome. Preparations not having been made
by limiting the previous business of the Institution, its whole
ability was on the stretch, and combining this with the embarrassments of the times, which make retrenchments every where
difficult and in some places impossible, the real weight of the
transaction is doubled. It is therefore very important that the
Bank should be informed as far as you are at liberty to confide.
Will you also permit me to suggest, that the effect of such a
payment is great on the general commerce of the country; that
it is greater than the payment of many times the sum within the
country, which remains in the market and only changes hands!
that the last payment is now and will for the ensuing twelve
months, be severely felt, and that the country will badly bear
the payment of three millions more until it has had some rest,
has restored its means, and has weathered or repaired the effects
of those storms which, both in Europe and the United States
at present, seem to threaten as well public as private finance?

45
I have ventured to trouble you with these views with the
hope that you will pardon the liberty, and with the conviction
that if you can serve this Institution in any of them which you
shall deem consistent with the public good, you will feel a pleasure in doing so.
I have the honour, &c. &c.
(Signed) L. CHEVES.
T H E HON. W . H. CRAWFORD,

Secretary of the Treasury, City of Washington.

Treasury Department, 27th March, 1819.
SIR,

Your letter of the 20th instant has been duly received. The
view which it gives of the state and concerns of the Bank, is
deeply interesting to the government, and is entitled to the
most serious consideration of this department.
The derangement of the currency, which embarrasses ail the
fiscal transactions of the government, can be restored only by
great circumspection in the management of the principal banking institutions of the Atlantic cities.
In the adoption and prosecution of the measures necessary
to a gradual but ultimate restoration of the currency to a sound
and healthful state, the Bank of the United States must lead
the way. The task will be executed with difficulty and loss to
those institutions, if indeed it be practicable. The diminution of
the dividends consequent upon the execution of the measures
necessary to ensure the prompt redemption of their notes in
specie, when compared with the reduction of the prices of labour and of the produce of labour resulting from the same
source, will be found not greater than in the latter cases.
The expediency of continuing to import specie from abroad
may well be questioned. It is the performance of an operation
which can be successfully and profitably executed only by those
who can be remunerated for the cost and expense incident to
it, by disposing of the specie imported at a rate beyond its legal
value. Every importation effected by the Bank supersedes the
necessity of importation by the mercantile interest to an equal
amount. The Bank has already expended more than 500,000
dollars in the importation of specie. If this expense had been

46
incurred during one year, it would be equivalent to more than
the interest of 8,000,000 dollars. If the expense of the importation is to be charged upon the operations of the Bank for
eighteen months, then it is nearly equal to the interest of
6,000,000 dollars, for the same time. The reduction of the discounts of the Bank to the latter amount, would have had the
same direct effect upon the profits of the Institution, as the
importation of specie. What the general and indirect effect of
the former measure upon the interest of the Bank would have
been, compared with that of the latter, may be considered doubtful. If the omission on the part of the banks to import specie
had imposed upon the mercantile interest the necessity of importing it to the amount imported by the banks, beyond what
was actually brought into the country by commercial enterprize,
it appears to me that the situation of the banks must have been
bettered by the adoption of that policy.
If the directors shall, however, be of opinion that, upon general principles, or in consequence of the particular situation of
the Bank, it is important that specie should continue to be imported on account of the Bank, every facility will be given by
the Navy Department in effecting that operation which the public service will permit.
Several vessels will shortly sail on a cruise in the West Indies, and in the Gulf of Mexico, for the protection of our commerce. Their commanders will be instructed to touch at such
ports in the vicinity of their respective stations, towards the
termination of their cruises, as you may designate as being the
probable deposit of specie for the use of tjie Bank, or of the
merchants of the United States, and receive on board and bring
into port whatever amount may be delivered to them. One of
these vessels will probably sail from the Chesapeake by the
middle of next month. It will be proper for you to inform me
of the ports in the W"est Indies and on the Spanish Maine,
where it will be proper for these vessels to touch preparatory
to their return into port.
Should the Bank or the commercial interest procure any
considerable amount of specie at any point where the employment of a public vessel should be necessary, which cannot be
conveniently and in due time brought by one of the cruizing
vessels, an application will be promptly made to the Navy De-

47
partment by the Secretary of the Treasury for its aid, which I
am assured will always be given when practicable.
The enclosed statement will show you the gross amount of
duties receivable during three months ending on the 31st of
May next, and the amount which is receivable in the principal
ports. The difference between these two statements is receivable at the smaller ports, of which Norfolk, Savannah, Alexandria, Salem, Portsmouth, Providence and Portland are the most
important. The quarterly payments at the Treasury, on account
of the public debt and civil list, amount to about 1,500,000 dollars, Boston, New York, and Philadelphia are the points at
which the public debt has principally accumulated. The accounts of the Bank with the Treasury will enable it to determine with sufficient accuracy the sums which will be quarterly
necessary at these places to meet the demands upon the Treasury on account of the public debt.
It is not intended to redeem»more of the Louisiana stock during this year than three millions. The amount of stock held by
foreigners which will be redeemed will exceed 2,000,000 dollars.
But the commissioners of the sinking fund are bound to employ
the whole amount of the fund appropriated for that object.
There will remain after the redemption of 3,000,000 dollars, of
the Louisiana stock, about a million and a quarter of dollars
which must be employed in the purchase of the public debt. These
purchases will be made of stock held in the United States so as to
avoid the necessity of greater remittances to Europe than what
are indispensable. In the course of the next or succeeding month
authority will be given to purchase, but in order to make them
gradual, I propose to recommend to the commissioners, to confine the purchases to the three and seven per cent, stock, which
are now within the limits at which purchases can be legally made*
In order to prevent, as far as practicable the exhaustion of
the public funds in the Atlantic cities, I have induced the Secretary at W a r to expend a larger amount of the sum appropriated for that department, in the western states, than has
heretofore been effected. If this can be extended to the utmost
limits of which it is susceptible, I calculate upon a considerable accumulation of the public funds in the course of the two
approaching quarters.
Shortly after the quarterly payments are effected on the first

48
of next month, a remittance of 150,000 dollars will have to be
made to London and Amsterdam, on account of foreign intercourse, 40,000 dollars to the latter and the remainder to the
former place. The plan of purchase will be left to the Bank.
After this remittance shall be effected, the demands upon the
Treasury until the 1st of July will be confined to the War and
Navy Departments. The former having made all its advances
to contractors, has assured me that its demands during the two
next quarters will not be great. Those of the Navy Department
will be more uniform in their quarterly amount.
I have requested of both Departments to inform me as early
as practicable when any considerable demand shall become necessary upon the Bank or its branches east of this place.
Every facility which is in the power of this department to
afford to the Bank, in its efforts to support specie payments
and restore the currency to a natural state, may be confidently
relied upon by the Directors. *
I remain with respect
Your most obedient servant.
(Signed) WILLIAM H. CRAWFORD,
LANGDON CHEVES, ESQ.

President Bank U. S.
Private.
Bank of the United States, April 2d, 1819.
SIR,

I have the honour to acknowledge the receipt of your favour
of the 27th ulto. in answer to my private letter of the 20th ulto.
As the contents authorized a disclosure of them to the Board, I
communicated them; and with myself they felt particularly
obliged by the frankness and fulness of the information it containctl on points of the greatest materiality to the management of the
Institution. I am constrained again to use the liberty of a private and unauthorized letter to lay before you my impressions
on the critical situation of the Bank. I do not hesitate to say
it is utterly impossible to support specie payments to the 1st of
June in the manner in which the Bank at present receives and
disburses the public revenue. The present mode puts calculation on limited means such as ours out of the question. We

49
&re proceeding entirely at hazard. W e depend on the fidelity
skill and obedience of the officers of eighteen establishments,
acting under general rules, susceptible necessarily of some latitude of construction and therefore of abuse and neglect. On
the g«od will and fidelity on the one hand, and on the other the
hostile favouritism and interestedness of hundreds of public
agents 3 the receivers and disbursers of the public money, and
on all the irregularities of an embarrassed commerce which
turning out of its accustomed courses, sometimes pours upon
particular points an unexpected flood, and at others leaves these
channels dry. Under such uncertainties double the natural
means would be necessary; and we have to meet them with
half those means.—We probably have enough to enable each
Office to meet its own engagements, but having no surplus, we
have no means to apply to so many contingencies. It has
t:ost us at the Parent Bank during the month of March the
proceeds of 85,000 dollars of 6 per cent, stock which we have
lately sold, 150,000 dollars specie received from Charleston,
50,000 dollars received from New Orleans, and a daily curtailment in our discounts. W e have no such resources left for the
month of April or any subsequent month. On this day all the
specie in our vaults is not equal to the payment of the state
banks by 30,000 dollars; we have, however, 260,000 dollars in
the mint and £00,000 dollars on the way from Pittsburgh. From
the statements of the public receipts and probable payments,
the same causes will operate to a much greater extent in April
and May. These causes are principally the following:—
1. The receipt of the bills of the Bank payable at other offices*
than that of the receipt on account of duties.
2. The payment of the Treasury drafts without reference to
the places of accumulation and without time to perform the
operation of transferring funds.
3. The payment of debentures under checks on the Bank and
its offices by the collectors, which are paid by the Bank in coin
or an equivalent, while the amount of the duties has been paid
in notes not of the collecting office to the collector, which have
been received of him as a cash deposit to the credit of the United States with the Bank.
All these causes resolve themselves into one effect, the necessity of paying where the appropriate funds have not accu-

50
tnulated and cannot be placed without time for the operation
If the funds of the bank were under its control and if at the
same time the deposits of the government greatly exceeded its
current payments, which would present an ordinary state of
things, the present system might be practicable. It is in vain
that we have redeemed ourselves from the inevitable ruin which
stared us in the face as the result of perseverance in the endeavour to equalize exchanges and the payment of our notes whereever they were presented, if we continue, in the present state
of our funds and the present state of the Treasury, to receive
our notes at all points in payment of duties, and disburse the
government monies as at present. The receipts of duties iriw
March, April and May will be 6,667,410 dollars 44 cents which
would more than absorb our whole circulation, which is little
more than five millions—the result is that we might as well be
bound to pay all our notes in coin wherever they may be presented. It may be supposed that they would not be taken out
of their usual circulation for the payment of duties, as for this
purpose the public debtor would be obliged to keep them on
hand till his bonds became due, and that the loss of use would
be more than equivalent to any advantage. But this is not the
state of the fact. There is a traffic in them carried on which
makes them cash at any moment for all other purposes and at
the same time keeps them in reserve for the payment of the
public demands. Thus, the state banks will receive them on
deposit as cash, and in the course of their business readily pay
them out again to the many applicants who want them to pay
the immense sums which the government is almost daily demanding. This is the principal operation, but there are many
others by which they are made a commodity constantly applicable to the payment of the public demands, and yet their present use as money not lost. The evil is of such a magnitude
that we must immediately find some relief or we must be the
victims of it. I am aware of none but the removal of the causes;
nor will, in my opinion, any thing short of the total removal of
them serve this purpose. It is much to be lamented, if my views
be not wholly incorrect, that the subject has not had an earlier
consideration. If it had resulted in an early application of the
remedy, it would have saved the Bank a great deal of that
strength which it has exhausted in supporting the present system and which is lost to it and to the government. The ope

51
ration of the causes was discovered, but their magnitude and
their danger could not be seen without the information which
you were so good as to afford in your letter of the 27th ultimo.
To myself it was obvious that we were without chart or compass until we obtained that information, and therefore I used
the first moment I could spare to ask it. If the statements of
the Parent Bank and the Offices north of it be adverted to, it
will be very obvious they have no more at most than an ability
to meet their own engagements. The Offices of Virginia afford
us no relief either from indisposition or inability, perhaps a
combination of both, notwithstanding the most earnest entreaties and remonstrances. North Carolina, of course can do little,
Charleston and Savannah have been our great resources, and
their means are in full requisition for the payments in Europe,
and all their assistance must fall far short of supplying that demand. New Orleans has, with abundant means, afforded us
comparatively little aid—and much of the time during the present year has passed over when it could be most advantageously
done. All, too, which it can add, and more, will be necessary to
meet our European debt. It follows then inevitably chat the
government receipts and payments must not diminish or embarrass our means at the points of the greatest pressure, or we
must fall. If left to pay where we receive (or at other points
after such previous notice as will enable us by the usual operations to transfer funds) and to receive only what we can pay
away, I incline to think, if we act immediately, we will jet
be able to sustain ourselves at all points. I am sure otherwise
we shall fail to continue specie payments. On this latter point I
am supported, I believe, by the experienced officers of the Bank,
and by every member of the Board who usually attends its meetings. With these impressions I have this day asked permission
to call a meeting of the foreign directors (those absent from
Philadelphia) on this day week (9th instant) to determine on
the course which the Bank should take, and I have principally
for these reasons, submitted to you these views that you may be
apprized of the state of the bank, and of the course that the
Board may find itself, with a view to its immediate safety,
obliged to take. It would be very gratifying to me, and no
doubt equally so to the Board, to have your views on the subject, and particularly your approbation of the only course

52
which can afford us safety, if that be at all practicable. With
the proposed changes I do not despair.
On the right to refuse any o.ther paper than that of the place
where the public debts are payable, I have not imagined that
there can be any doubt. The act of Congress only makes the
bills of the Bank receivable when they are payable on demand,
or are due, but leaves them to be governed by their tenor and
effect. It no more makes them receivable where they are not
payable than for more than they are payable. A different construction would oblige the government to receive, but it could
not impose it, but by agreement, on its agents (the banks) in
their collections. Undoubtedly, except in a case of self preservation, the wishes of the government would be a controlling consideration. But the remark is only made to show the embarrassment it might, under possible circumstances, occasion to the
government. It is not required by any claim of justice on the
part of the public debtor. In making such a change a short no
tice might be given, though it must be short to enable the
Bank at this time to bear it. I have inquired of the only member
of the board of the old Bank of the United States who is a member of this board, under what impressions the present practice was adopted by that institution. He says it was adopted because the Bank found it convenient to do so, and not under the belief that it was obligator}^.
This subject bears directly and immediately on another most
important point on which you have been so good as to express
your views;—the payment of the 3,000,000 dollars of the Louisiana debt. It will be impossible to pay the two millions receivable by foreign holders, unless by obtaining a loan in
Europe. The utmost ability of the Bank will be required to
keep its faith in paying the balance of the former payment by
the 1st of August next, which is the stipulated time. If the
Bank can sustain its credit, it may be encouraged and enabled
to negotiate immediately for a loan, but it will be obliged to
stipulate for a much longer period of indulgence than was required in the former arrangement. It must have time to re-establish and re-invigorate itself, and in the present embarrassments
of Europe I am afraid no small difficulties will be found in negotiating such a loan. The whole subject is not one, I think, which
calls for despair; but it requires exertion and decision, In both

58
we will, no doubt, feel greatly strengthened by your countenance in the measures we may be obliged to adopt.
I am sensible, sir, that so much of this communication as
consists of my own opinion, is entitled to little consideration.
But I may add, that on the main point I think there will be no
difference of opinion among those who at present have the management of the Bank. And these opinions have been only intended as the vehicle in which to convey the facts on which
your own mind will be enabled to act.
The facilities offered by the government in the procurement
of specie, will be very useful, if any thing can or ought to be
done in that business. On that subject I will, if it be not deemed obtrusive, trouble you briefly with my views, in connexion
with a very few ideas on some temporary means of restraining
the exportation of specie. I do not mean by prohibition.
I have the honour to be, sir,
With great respect, your obedient servant,
(Signed)
L. CHEVES.
T H E HON. W . H. CRAWFORD,

Secretary of the Treasury, City of

Washington.

(Private.)
Bank of the United States, 6th April, 1819.
SIR,

The very critical situation of the Bank, which is becoming
more so every hour, the great interests, both public and private,
which are involved in its fate, and the intimate connexion it
has with your department, I hope will be a sufficient apology
for the frequency of my communications. The directors who are
not resident in Philadelphia, have been summoned to attend
the board on the 9th inst. and I am desirous of informing you
fully of the situation of the Bank, in order to obtain your views
should you think fit to give them on the subject; and that you
may not be surprised by any steps the Bank may be obliged
to take with a view to its safety. I think, as I have before said,
the only adequate relief is to be found in not requiring the
Bank to receive its paper except where payable, and allowing
it time to transfer by actual transactions the funds which accumulate at various points, to those where the government may
be obliged to disburse them,

54
On the obligation to receive the branch notes, the Bank lias
asked the opinions of Mr. Binney and Mr. Pinckney. The opinion of the former has been obtained, and I owe it to candour
to state to you that it is adverse to the opinion I expressed in
my last letter to you. He thinks that the government is bound
to receive them wherever payable, and that the Bank, as its
agent, is alike bound. Bat that it is not bound to give the government credit otherwise than according to the tenor of the
note. The opinion of Mr. Pinckney has not yet been received.
If the opinion of Mr. Binney be correct, the embarrassments of
the Bank and the government both will be much increased. If
the government be bound to receive, and the Bank be unable
to pay, except according to the tenor of its notes, you will better judge than I can state, what will be the probable effect on
the national finance. Exhausted, scattered and inactive, as the
funds of the Bank may be, it has still more ability than any
combination of banks as they are now situated can establish.
I confess I always considered the construction as a popular
error, growing out of the voluntary practice of the old Bank,
and I must yet have stronger reasons than any I have met with,
to change my opinion. The magic seems to be in the term " all
payments?' But then the payments are to be made, I v/ould say,
as all payments are made, according to the contract, in money
of the place where it is payable* The Bank is literally bound to
receive its notes in all paymmts to itself exactly as the government is bound, but it is nevertheless not bound to receive them
in any payment at points where they are not payable. All remote and conjectural arguments of policy and intention, and
there are none which bear with strength or certainty on the
point, 1 think yield to the controlling nature and effect of the
contract of the debtor to pay, which embraces as essential parts
of it, the place and the money of the payment, and the tenor
of the notes, which makes them no payment where they are not
payable.
The obligation of the Bank to transfer the public funds, does
not att'ect the question, because it is entirely independent of it.
I think the strongest argument which I have heard in support
of the opinion that the government is bound to receive them
where they are not payable, is, that as the notes are receivable
in all payments they will of course be receivable in states and

55
territories where the Bank has no Offices, and therefore must
be received where they are not payable. This argument is certainly plausible; but I doubt whether it is more than plausible.
The force of the argument is founded on the supposition that
there exists a legal necessity for receiving them in all the
states and territories, which is little less than an assumption of
the point in controversy. There is no necessity, though there
may be expediency in receiving them in states and territories
where the Bank has no branches. Payments may be made as if
there were no Bank of the United States. The necessity then
does not exist, and the expediency will be met, under all proper
circumstances, by the voluntary acceptance of the government.
Besides, the argument proves too much. If the notes were receivable in all payments, without reference to the contract of the
debtor or their tenor, then they are receivable in every part oi
the habitable globe, where the United States may have a debtor,
and I think it cannot be denied that if the bankers of the government in London or Paris or Amsterdam, should become
debtors, and should choose to make the point, they might pay
their balances in branch notes.
If this construction be right, I cannot wish that it should not
prevail whatever may be the consequences. I venerate the certainty and obligatory character of the laws, but it must nevertheless be a subject of lamentation that a construction should
be necessary which will inevitably go far to prostrate this noble institution, and with it deeply and injuriously affect all the
interests of the state, whether public or private. I feel satisfied
that a different construction affords the only hope on which t©
rest with any confidence the credit and safety of the Bank.
There is no point of the whole institution where it cannot, if it
can make the change proposed immediately, and each be only
required to meet its own obligations, by a little sacrifice be
sustained. But when the means of all may be called to any, without any practically useful warning, it cannot support any point
long where the pressure may be severe. It has certainly no more
than ability to meet at the natural points, the obligations of the
Bank, and any diversion from these points turns adequate ability at once to feebleness, For full and conclusive proof that
there is no excess of ability which can be held disposable for
contingencies, [ refer to the weekly statements furnished tOyoui

56
department. To the same I refer for reasonable proof that it has
ability to meet its engagements at points to which they are
naturally referrible.
I beg leave to state one or two particulars to show how distressing and unmanageable the government receipts and payments are in the present mode. The receipts of duties at Philadelphia within the last week have been about 208,000 dollars.
Of this sum upwards of 70,000 dollars have been received in foreign notes. The drafts of the government and the checks of
the collector for debentures instantly draw all the receipts of the
government out of the Bank, and this operation is on the whole
therefore equal to a draft of 70,000 dollars on the vaults of the
Bank. The proportions of foreign paper received at New York
and Boston, it is morally certain are greater, but allow them to
be the same, and even those of Philadelphia have heretofore been
greater. In March, April and May the duties receivable were
6,667,000 dollars and upwards. The same proportions would
therefore give a draft on the vaults of Philadelphia, New York
and Boston for 2,200,000 dollars and upwards. Let any deductions whatever be made for inaccuracy of estimates and the result is yet seen to be inevitable that the Bank must fall if the
present system be persevered in.
That all the government receipts are drawn for almost immediately will be proved by reference to the accounts of the Bank
with the government and its drafts. On the 5th instant (yesterday) the cash deposits of which the Bank is informed, and
its information is probably as late as that of the government,
were only 1,056,897 dollars, 23 cents, and the drafts of which the
Bank has notice, amount to 1,240,300 dollars, leaving a balance
against the government of 183,400 dollars. Besides, there are no
drafts for the last quarter's interest on the funded debt payable at
New York and Boston, which nevertheless will be payable, according to custom and will encrease the balance. There may
be and probably are collections of which we are not informed,
which may cover these drafts, but this aggravates our distress.,
for we are called upon to pay at Philadelphia, New York and
Boston, our weak points, what may have accumulated at remote
branches, before we know of the receipts.
Now to show some of its actual effects on our vaults. The
balances against us yesterday with the city banks was 914,000

57
dollars, we suffered drafts for specie during the day of 50,000
dollars, by banks and brokers, and the day closed with only
95,000 dollars specie in our vaults, and we had the day before
received 50,000 dollars from Baltimore. But notwithstanding
this deplorable state of things, if we were permitted to apply
our means to their proper objects there would be no grounds for
despair. W e have upwards of 200,000 dollars in the mint and
£00,000 dollars on the way from Pittsburgh and we could and
would, by a sacrifice which would terminate the evil, provide
more means if necessary. But of what use would exertion be
against the operation of the irresistible causes whose existence and effects I have pointed out.
I pray you then, sir, to consider, if you should not be forbidden by your own deliberate opinion, or the concurring opinion
of counsel on the point of right, whether you cannot yield your
approbation to the rejection of foreign notes in the payment of
duties (it need extend no further) and give us such notice of your
drafts as will enable us by actual operations to draw the revenue from the points where it is received to those where it is to
be disbursed ? The expense we are willing to meet. Or, if foreign notes must be received; then whether you cannot conform the operations of the Treasury to our actual ability (the
whole of it shall be faithfully exerted) founded on actual transactions for the transfer of the funds from the points on which
your drafts are properly chargeable ? To require more will cer~
tainly not serve the government, though it may break down the
Bank.
I am, sir, with great respect,
Your obedient servant,
(Signed)
LANGDON CHEVES.
T H E H O N . W M . H. CRAWFORD,

Secretary of the Treasury, City of Washington.
(Private*)
Treasury Department, April 6, 1819.
SIR,

Your letter of the 2d instant was received on the 4th, and
has received that consideration which the importance of the
* This correspondence is not published without the acquiescence of
the writer.

H

58
questions presented in it so well deserves. You are of opinion
that the continuance of specie payments by the Bank depends
upon the adoption by that Institution of the following regulations: viz. 1st. The receipt of no bills of the Bank or of its
Offices, payable at other places than where they are oiFered in
payment of duties. 2d. Exemption from the payment of treasury drafts drawn without reference to the accumulation of public money, and without time to perform the operation of transferring them to meet such drafts. 3d. The refusal to pay " debentures under checks on the Bank and its Offices, which are
paid by the Bank in coin or an equivalent, while the amount of
the duties has been paid in notes, not of the collecting office,
to the collector, which have been received from him as a cash
deposit to the credit of the United States with the Bank." It
may be proper to observe that the second proposition is entirely within the control of the Treasury, and that no difficulty
will occur in relation to it. The drafts drawn upon the Bank
and its Offices, to any considerable amount, under the immediate direction of the Secretary of the Treasury, are confined
almost exclusively to the payment of the interest of the public
debt. The payments on this account at the principal Loan
Offices, do not materially vary during the year. The Bank is
always apprized of course of the amount which it may be necessary to transfer to any given point to meet the payment of
the interest, and reimbursement of the principal of the public
debt in each successive quarter.
The remittances made to London and Amsterdam, for the
payment of the interest of the Louisiana debt, and for the discharge of the demands connected with our diplomatic intercourse, have been uniformly effected through the agency of the
Bank and its Offices, which it is presumed, gives the necessary
notice where the purchase of bills may require the transfer of
public money. The payment to the W a r and Navy Departments
will be hereafter regulated upon the same principle.
Before I submit any views to your consideration concerning
the first and third propositions, which are substantially the
same, it may be proper to observe that I am sensible of the extent of the embarrassment to which the Bank is and must for a
considerable time be subjected, to enable it to continue to dis«
charge its notes on demand in specie. It is even doubtful whe-

59
ther it is practicable, ivith all the exertions ivhich it is in its
power to make, to continue specie payments through the year. If
its principal reliance is placed upon palliatives, the stoppage
of specie payments by the Bank and by the state institutions,
is inevitable. The axe must be applied to the root of the evil
or the country will be inundated with paper which has no relation to specie. Admitting that the state banks in the commercial cities, as a body, are not better supplied with specie than
the Bank of the United States, can the demands for exportation
for the prosecution of the East India and China trade, be satisfied, and a sufficiency be retained for the support of the ordinary banking transactions? I presume there can be no difficulty
in answering this question in the negative. Specie payments
must then be abandoned, or the banks must reduce their specie liabilities nearly to the amount of current coin in their
vaults, at least until the rage for exportation shall have ceased.
These are the alternatives presented to the banks as a community. There is no middle course. Palliatives may prolong the
existing embarrassments, and, by exciting the hopes and fears of
the community, aggravate the existing evils, but cannot influence the final result.
Permit me now, sir, to offer a few observations upon the proposition intended to be submitted by you to the Board of Directors, to refuse to receive from the government the bills of the
Bank and of its Offices, at any place except where they are
made payable. I do not intend to examine whether the Bank is
bound to receive from the government its bills under such circumstances. I shall confine myself to the consideration of the
consequences which will probably result from the adoption of
the measure, both to the Bank and to the government.
The latter will be the first in order, in the views which I propose to submit to your consideration. The government must
follow the example of the Bank, or it must continue to receive
from its debtors the notes of the Bank and its branches, which
will not be received from it by the Bank and its branches. In
the first case it is probable that the holders of the paper thus
refused in payment, will consider it a legal tender, and rely
upon, the question of law which necessarily presents itself in
the transaction. The great and universal pressure now weighing
down the commercial community, offers adventitious induce-

60
ments to this course. There will be no odium attached to this
procedure. The refusal of credit at the custom house, to those
who adopt it, will under the precedents which have been established, be considered as a measure of extreme rigour, and cannot fail to excite much clamour not only against the Treasury,
but also againt the Bank. If the tender of the bills of the Bank
and its Offices should, under such circumstances, be generally
resorted to, the receipts into the treasury will be immediately
insufficient to meet the current expenses of the government^
the vital interests of the nation will be sacrificed, and a complete fiscal derangement necessarily ensue. I offer no opinion
upon the legality of the tender under contemplation/and unfortunately the absence of the Attorney General prevents a
resort to his legal advice, upon a question of so much delicacy
and importance. There can, I think, however, be but little doubt
that the question is not so clear against the legality of such a
tender, but that professional men of the highest standing will
be found in its support.
The bills of the Bank when they are payable on demand or are
due, are"f'eceivable in all payments to the United States. The
question of where due, so important to the Bank, and no less
goto the government, when the Bank avails itself of it in its
transactions with the government, is not brought into view as a
condition upon which it is to be received. The Bank is under no
obligation to the government to establish any office except at
this place. Let us suppose that no other office has been established, the government then, in the face of its undertaking to
receive the bills of the Bank, which are payable on demand or
are due, in all payments to the United States, would, according
to your opinion, be under no obligation to receive the bills of
the Bank and it^ solitary Office, except when tendered at Philadelphia and Washington respectively. I doubt extremely
whether an idea of this kind was entertained by a single member of congress who voted upon the bill establishing the Bank.
I am persuaded that the adoption of the measure will draw
down upon the government the public indignation to an extent
never before witnessed in this country, the consequences of
which it is as difficult to foresee as to prevent. If such will be
the consequence to the government, I may be permitted to ask
what the Bank is to gain by the adoption of this measure, evea

61
when aided by the government in its execution, which will
compensate for the irritation and resentment which I am persuaded will be excited by it? In the first place, it will be relieved from pressure at Boston and other places to the east of
this city where the demand for specie for exportation is great,
so far as that pressure has been increased by the accumulation
of bills of the distant Offices in those places. Let us admit, for
the purposes of this examination, that no resort will be had to
the tender of the bills which the Offices will not receive from
the collectors; that the duties accruing at Boston will be paid
in specie, in bills of the Office at that place, and in the bills of
the state banks in Boston. The liability of the Office for specie on account of the government, beyond what is paid in, will
be the amount of its bills received in discharge of duty bonds.
The bills of the other Offices, which had before been receivable,
will be thrown back upon those Offices, the specie drawn from
them and carried to Boston. The advantage to the Bank, in the
first instance, consists in imposing upon the holders of them the
expense and time spent in transporting the specie they represent to Boston, instead of doing it itself. Ultimately the measure terminates in confining the circulation of the paper of the
Bank and its Offices to the districts in which it is issued, as
much as that of the state institutions. The pressure upon particular Offices will be reduced, whilst that on others will be increased. It is probable that the time and expense of transporting specie from one place to another may diminish in a small
degree the general drain from the Bank and its Offices. But
as long as the demand for exportation shall afford a premium
sufficient to bear the expense of transportation from New Orleans to Boston, and pay a profit to the carrier, there will be no
considerable diminution of the quantity exported, resulting
from the adoption of the measure intended to be submitted
to the consideration of the directors. The measure is then
simply palliative, furnishing nothing like a radical remedy.
I t gains a little time to the Bank, at the expense of what,
I fear, will prove much more detrimental to it than the time
which will be gained.
But it is probable the Treasury will be constrained to receive
the bills of the Bank and its Offices without regard to the place
where they are payable. It becomes necessary then to inquire

62
what will be the result of this course to the government and
to the Bank? It is manifest that the immediate consequence to
the Treasury will be the accumulation of special deposit from
Portsmouth to New Orleans. This special deposit, consisting
of the bills of the United States Bank, accumulated at places
where they are not payable, must be made effective, either by
transferring them to the specie which they represent, or by
transferring the specie to them. This transfer, however made,
must be effected by the Bank of the United States. For example, ' 100,000 dollars, in the bills of the Office at Charleston,
are received by the government, at Boston. The government
requires that this 100,000 dollars shall, at the expense of the
Bank, be sent to Boston. The Bank cannot allege that the government had not 100,000 dollars at Charleston. To make this
allegation upon presentment of the bills, would be to charge the
Office at Charleston with insolvency. If any doubt should exist
upon this point, the operation might be reversed. The Office at
Charleston might be required to transfer the specie to Boston,
where the bills which represent it are deposited. The one or
the other of these requisitions would be obligatory upon the
Bank. I presume there can be no reasonable doubt of the legality of the former.
According to this view of the subject, the only thing gained
by the Bank is time to make the transfer. That can always be
given without resorting to the measure proposed. The expense
of transferring is, in either event, borne by the Bank. I see no
real benefit that can result to the Bank from the adoption of the
measure, unless the Treasur} r shall adopt the same rule of conduct. I have endeavoured to explain the nature of the embar*
rassments which will probably result to the finances of the Union
from its adoption. The evil so strongly to be apprehended may
not occur, but, when the pressure of the times is considered,
the strong temptation which it presents to obtain delay, by disputing the legality of the regulation, the additional incentive to
the adoption of this course, resulting from the irritation which
will probably be produced by the refusal of the bills of the Bank
and its Offices; when all these considerations are duly weighed,
I am fearful that you will only deceive yourself, if you calculate
upon securing any benefit from the course proposed to be submitted by you to the Directors, At the same time, I must repeat^

63
that I am deeply sensible of the difficulties by which you are, on
every side, beset. I greatly fear that no effort which it is in the
power of the Directors to make, ivill be successful. I wish to have
no other influence upon the decision which the Board of Directors is called upon to make, than the views which I have presented are calculated to produce. The first duty of the Board is
to the stockholders; the second is to the nation. I shall oppose
no obstacle to any measure which the necessities of the Bank
may require, and which in its nature is legitimate.
I shall submit the whole question to the President with as
little delay as possible. In the mean time, I shall take the opinion
of the Attorney General, upon the legality of a refusal by the
government to receive the bills of the Bank and of its Offices.
Until I can receive the benefit of the views of the President,
and of the legal opinion of the Attorney General, I shall make
no decision upon the course which the contemplated measures
of the Board of Directors may require me to take.
My present impression is, that the safety of the Bank can
only be effected by withdrawing nearly the whole of its paper
from circulation. If the Bank does this, all other solvent banks
will be compelled to do the same. When this is effected, gold
and silver will be introduced into the country, make a substantial part of the circulation, and enable the banking institutions
gradually to resume their accustomed operations. Whilst this
is effecting, the community in all its relations will be greatly
distressed. Considering the extent of suffering which has already
been experienced, it is greatly to be desired that some good may
result from it. This is impossible, unless the experiment is per
fected. To stop payment at this point, or on any future day, will
prove that the object for which so much suffering has been sub
mitted to, was unattainable.
I shall, at all times, be gratified in receiving any communication which you may be disposed to make, either individual or
official. Indeed, a free communication of the measures of the
Bank, and of the reasons upon which they are founded, will not
only be acceptable, but can hardly fail to be useful, both to the
Bank and to this department.
It may not be improper to state, that most of the measures of
the Bank which were the subject of censure, both in the public
papers and in the report of the committee, never were comrau-

64
nicated, officially or unofficially, to this department. It derived
its knowledge of the existence of those measures from the
sources through which they reached the public. I do not mention
this by way of complaint; I had no legal right to ask such communications, and of course made no request that they should
be made.
I remain, with sentiments of
The highest respect,
Your most obedient servant,
W . H. CRAWFORD.
LANGDON CHEVES, E S Q .

President of the United States'
Philadelphia*

Bank,

Treasury Department, April 9,1819.
SIR,

I have the honour to acknowledge the receipt of your letter
of the 6th instant.
The answer which Mr. Binney has given upon the question
which has arisen under the 14th section of the Bank charter,
corresponds, in every respect, with that which I entertain. It
appears to me, that there are other reasons, besides that which
arises out of the fact, that there are states and territories in
which there are no Offices established, that are equally strong,
if not stronger. At the time the Bank was chartered, the internal duties were considered a permanent part of our system of
revenue. At the same session at which the charter was granted,
a direct tax of three millions of dollars was imposed. The derangement of the currency at that time was so great that, with
few exceptions, the money collected in one place, would not be
received by the public creditor in another. The evil resulting to
the government and to the nation from this state of things, was
one of the principal, if not the exclusive cause of the incorporation of the Bank.
It was intended, through the instrumentality of the Bank, to
furnish a currency which could be every where received and
paid away by the government. In determining the construction
of the fourteenth section of the act, it is impossible that these

65
circumstances should not have some weight. It appears to me,
that you have connected, in the consideration of the subject, the
obligation of the government to receive, too closely with its obligation to deposit the public money where received, in the
Bank and its Offices. The questions are entirely distinct in their
nature. The obligation of the government to receive, does not
in any degree, depend upon the proximity of the Bank or of its
Offices to the place of receipt. The obligation of the government, at the time it was incurred, was to receive the direct tax
at the house of each individual upon whom it was levied. The
site of the Bank and of its Offices are mathematical points. The
bills of the Bank and of its Offices are payable only at these
mathematical points. It is only when tendered in payment to
the United States at these points,, that these bills are receivable
hj the government, according to the opinion you have formed.
It may be said, that this is pressing the construction for which
you contend, beyond its natural extent; that the bills of the Bank
and of its Offices ought to be considered the money of the state
in which they are respectively established. It appears to me,
that there is no connexion between the Bank or its Offices, and
the limits of the states in which they may be located. The limits
of the circulation of their paper are not those of the states respectively. The circulation of the bills of a Bank is determined
by the commercial intercourse between the place of its establishment and the surrounding country. If the bills of the Office
at Baltimore be offered to the collector of internal duties for
the district of York in Pennsylvania, they could not be received,
according to the idea of the Office in each state supplying the
state with money; yet such bill would, in point of fact, be as
much payable at York as the bills of the Mother Bank; and, in
point of convenience to the debtor and creditor, much more so.
It is impossible to say that a bill payabje at Philadelphia is any
more receivable at York, on the supposition that the United
States are not bound to receive them except where they are
made payable on their face, than one payable in Baltimore. If
then, as I believe, there is no connexion between the limits of
the states and the circulation of the notes of the Bank and its
Offices established in them respectively, and it is manifest that
there is no such legal construction, the bills of the Bank are
receivable bv the government at the places only where the Bank
T

66
and its Offices have beon established, and there only where the
notes tendered are payable at the place of tender, whilst the
government is boundvto demand payment at the house of each
citizen throughout the Union affected by the direct tax. A construction of this kind would produce an inequality in the rights
of the citizens that could never have been contemplated by the
legislature. But, sir, it appears to me, that the obligation of the
government to receive the bills of the Bank where they are payable on demand, whenever presented, even out of the United
States, can be supported without resorting to considerations of
the nature which I have endeavoured to present in the preceding
observations. It is manifest, from the phraseology of the fourteenth section, that the attention of the legislature was drawn
directly to the consequences of the undertaking which it contains.
The bills of the Bank are unconditionally receivable in all payments to the United States. The practice of issuing post notes
was known to the framers of the charter. To make post notes
receivable before they were payable, even at the place of payment, would have subjected the government to no other inconvenience than the loss of the use of the money until they became
due; jet this loss is carefully guarded against by the section.
The inconvenience arising from the receipt of a note at Boston
which is payable only at New Orleans, and which could be realized only after the time necessary to present it for payment
and remit the proceeds to Boston, is certainly equal to that in
the supposed case of the post note, yet there is no condition of
this kind attached to the undertaking of the government. Had
the section declared generally, that the bills of the Bank should
be receivable in all payments to the United States, it might be,
supposed that the framers of the charter thought there was no
necessity for inserting any conditions, on the ground that the
subject matter itself would necessarily furnish the means of c!e~
termining them. But the exception to the generality of the undertaking, it appears to me, upon sound logical principles, must
exclude all other exceptions than that which is expressly embraced by the section. The exception establishes the general
rule, that the bills of the Bank, payable on demand, are receivable in all payments to the United States. In fact, the government undertakes, in this section, to consider bank bills payable
on demand to be money in all its transactions with the public

67
debtors, whilst it is not money in relation to the public creditors.
No one can doubt the right of the government to assume this
obligation. If, then, it has, in fact, bound itself to consider the
bills of the Bank as current money, in all payments due to it,
the idea of money of the place where the contract is to be exe-\
cuted, with a view to refuse bank bills at places where they are
not payable on demand, appears to me to be untenable. Current
money must be current co-extensively, as to place, with the authority of the law which makes it current. I even contend that
it may be current, and in this particular case, as to the United
States, is current, beyond the jurisdiction of the law. That the
fourteenth section of the charter attaches itself to all contracts
with the government, when the contract does not expressly
stipulate against it, and binds the government to receive the
bills of the Bank, without regard to the place where they are
payable, as strongly, as if the obligation was specially inserted
in each contract. It may even be doubted, whether a stipulation
in a contract with the \ nited States, that the bills of the Bank
should not be receivable, would not be void. It would be a contract against law. A condition which the agents of the government would have no right to impose, and which it is presumed
the courts of law would hesitate to enforce. So long as the fourteenth section is in force, a tender of the bills of the Bank at
Amsterdam, Paris, or London, in payments to the United States,
could not, according to my impressions, be legally resisted. The
bills of the Bank, when made payable on demand, or which have
become payable on demand, are current money in all payments
to the United States. If they are not current money for this object,
except at the points where they are payable by the Bank, they
are, in fact, not current, as to ninety-nine out of every hundred
citizens from whom the United States, at the date of the underfaking, was bound to demand, at their respective places of abode,
the direct contributions which were required of them by the existing laws.
These views are presented to you at this time, under an impression that it is of some importance that you should understand the grounds upon which it appears to me the measures of
this department must be founded. The opinion of the Attorney
General is not expected until some time next week, but it would
lie uncandid not to say to you that J doubt whetherf even when

68
supported by his opinion, I should feel myself authorized To
adopt the rule which you think necessary to the security of the
Bank.
In deciding upon the question of expediency, which will necessarily present itself in the consideration of the subject, the
Directors will no doubt take an enlarged view of the whole
ground. Whatever may be their decision, I shall rest satisfied
that the motives which dictate it are honourable. No obstacle
will be opposed to it by this department, unless the imperious
interests of the Treasury shall require it. It is presumed, however, that the rule, if adopted, will not be extended beyond the
necessity which it is supposed renders it indispensable. Can
any injuries arise to the Offices south of this place, from a continuance of the old practice? The evils resulting from the payment of debentures, and from the exportation of specie for the
China and East India trade, are not felt in the southern states.
So far as an exception of this kind will have any effect, will it
not be to relieve to the same extent those points where the
pressure has been permanently and uniformly greatest? W h y
should the notes of the Offices at Boston or New York, which
by ordinary or adventitious circumstances, have been carried
t6 the southern states, be by regulation forced back upon those
Offices?
If the bills of the Offices in the eastern and middle states
never find their way into the southern states, the regulation as
to these states will be simply nugatory. Its application to them
will produce no other effect than to make the excitement as
general as the rule. It is possible that I may be mistaken in the
belief which I have expressed that the adoption of the fule will
produce a general dissatisfaction throughout the Union. 1 wish
that I may be; but I feel persuaded that the best and only mode
of diminishing the excitement which will result from the measure will be, the adherence on the part of the Treasury to the
practice hitherto pursued of receiving the bills of the Bank
without reference to the place where they are payable.
You will perceive, sir, that I have offered no opinion of the
right of the Bank to refuse to receive from the government,
and to credit as specie its notes, except tendered where they
are payable. With that question I have not and do not intend
,to interfere. It is the expediency of the measure, and not its le~

69
gality, which ought, it appears to me, principally to occupy the?
attention of the Directors. What will be gained by its adoption,
if the Treasury does not proceed pari passu with the board in
its execution? If but little is gained, the excitement which it
will produce against the Bank and Board of Directors will more
than balance it. Such I am apprehensive will be the result of
the experiment. In the present state of the precious metals,
not only in this country, but in the commercial world, it appears to me that the banks in order to secure the continuance
of specie payments, must approximate their circulation and individual deposits to a sum justly proportioned to the amount of
specie in their vaults. Any thing short of this will keep them in
a precarious state, and postpone the period when banking operations can be safely prosecuted upon ordinary principles.
I remain, with respect,
Your most obedient servant,
(Signed) W . H . C R A W F O R D ,
LANGDON CHEVES, Esq.

President of the United States' Bank^
Philadelphia.
Philadelphia, 13th April, 1819.
SIR,

I have had the honour to receive your letters of the 6th and
9th instant, and I am particularly obliged to you for the liberal
opinions they express and the kindness with which my communications have been received. The situation of the Bank calls
for decision, but it alike forbids rashness. I thought the opinion
of counsel in favour of the measure I proposed necessary to
make it justifiable. The opinion of Mr. Pinckney confirmed
that of Mr. Binney, and I therefore abandoned the measure. I
dare not add, to a correspondence already too much protracted,
my reasons in support of an opinion which is borne down by
the weight of authority, and which I am therefore bound to believe was founded in error, although I have not been able to
change the conviction of ray own mind. The manner in which
you have treated the subject in the present relations between
the Bank and the government, will embolden me to seek a personal interview with you, to disclose and explain to you the mo-

70
tives and objects of the measures adopted by the Board, which are
immediately connected with your department, and to solicit your
concurrence in some which they have proposed, which must depend on you for their execution. The principal measure in connexion with your department which has been adopted, I have
already, this day, had the honour officially to communicate. It
is founded in absolute necessity; without it, it would be vain to
make an effort; but if this and the other measures proposed
shall meet your support, I still think the Bank may get on. You
will perceive, when I shall have the honour to make them known
to you that they are founded in no selfish views; that while they
seek to save the Bank, they are calculated to benefit the nation,
The Bank of Columbia is indebted to the Bank United States
in no less a sum than half a million of dollars, and the Bank has
imposed upon me the duty to negociate with the former in person. This will afford me the opportunity of paying my respects to you in person in a few days.
I have the honour to be, sir, with great respect,
Your obedient servant,
(Signed)
L. CHEVES.
T H E HON. W M . H. CRAWFORD,

Secretary of the Treasury,
City of Washington.
(Private and confidential.)
Bank of the United States, 27th May, 1819.
SIR,

I have just received your letter of the 24th instant. My last
letter to you anticipated the matter of the Washington Office.
The necessary bills shall be supplied.
I have directed instructions to be given to the Offices while
the present arrangement subsists, to honour the drafts of the
Treasury without reference to apparent funds, which will render it unnecessary to furnish the statements you suggest, but
which certainly would be requisite if the Offices were, in their
acceptance of government drafts, to be regulated by the statements, This I hope will be satisfactory.
I have been very anxious for some time past to trouble yon

71
\vith a free communication on the subject of the Bank and the
mon^j concerns of the times, but my duties are so numerous
and so perplexing, that I have from day to day been obliged to
postpone it. You will no doubt have observed, however, that
we are at present quite safe. The banks in New York are considerably in our debt, and those of Philadelphia also. This is
one of our great difficulties. W e dare not allow them to be our
debtors to a large amount, because I feel satisfied if pressed
they would refuse to pay specie. I do not believe, though it is
very much in the nature of conjecture that I say so, that the
banks in this city have above a million of dollars, and I think
those of New York have not more. This is very unequally divided, probably, and when they should be pressed, if the balances were large, they would refuse to pay. They would feel
authorized to do so because they have the feeling so generally
pervading the community, that the last object of this Institution
should be its own interests and preservation. W e have drawn a
small amount from the city banks of this place, who very lately
drew on us without mercy, and yet the very institutions who
have not returned altogether as much as they have taken from
us in the last three months, are open-mouthed against us. An
officer of one, who, not a month ago, boasted that his bank was
doing very well, that the Bank of the United States furnished
all the specie they wanted, the other day, when called upon for
a portion of the balance due by his institution, by way of threat
said they could pay specie as long as the merchants could pay
their bonds to the custom house. You will immediately see the
tendency of this threat. It is one I have long anticipated.
When I had the honour of meeting you at Washington, you
may recollect I drew your attention to it. W e dare not collect
your surpluses (which we do not wish to use, and shall not I
hope touch in the way of business) but in funds which we
can tender in payment. State bank paper or balances are not
funds of that nature. Should they accumulate to large amounts,
they themselves would refuse local paper from us—if the demands should pass to them, as they probably will in a great
measure, they would probably demand of us, but it would de
pend altogether on contingencies, whether we should receive
of them. But if we could secure their utmost good will and
fidelity, as a great portion of our funds would not belong tr>

72
those who would be our debtors, we should be unable to meet
the demands upon us if we relied on balances due by them. If
your balances should accumulate pretty largely, then, in Baltimore, New York, and this city, we will find it exceedingly diffi
cult to keep down the balances of local banks. W e dare not
suffer them to rise, and if we press and compel them to stop,
many persons will be unable to pay their bonds, and others
will make it a pretence for a delinquency which they could not
otherwise have avoided. That they will not be able to meet
their engagements, I only state as a possibility. You have as
many facts as I have. They may even have the power to control us again unless we are very cautious, for our real power is
very little. But of this I feel tolerably confident, that in these
times of difficulty, when the large payments of government
have to be made, which will occur before the first of November
next, if they be large debtors to the Bank of the United States
they will not pay it. What then are we to do but persevere?
W e have authorized discounts on Louisiana stock at New
York, and will do it elsewhere to absorb that claim in some degree, and thus leave more money in the community. Yet I
think it very doubtful whether this will be a public benefit. The
real and original evil under which the country is suffering is
over-banking—this led to excess in trading, manufacturing,
building and speculating; and a history of the ill-judged enterprises which have been undertaken in these several concerns,
would give a very full history of all the distresses of this country, except a little agricultural distress, growing out of the inordinate expectations which the other causes excited. Now the
remedy is, as you have yourself remarked on former occasions,
to make all banking institutions provide the means to meet
every dollar which the course of trade or the embarrassments
of the times may throw back upon them. Any alleviation out of
the course of the real transactions of the times perhaps nurses
the evil. That which led to these remarks, however, (discounts
on Louisiana stock) will be inconsiderable, and I have only
used it to illustrate the subject. While, however, this is my
opinion of what is the real remedy, yet, as public opinion will
not go so far probably, I should be glad to add other means of
alleviation. I do not know, however, that I can suggest any. If
-\ difficulty should arise, will you authorize us to receive any

78
portion of their paper as special deposits? Your control over
them would be much greater than ours. W e might venture to
allow considerable balances to accumulate, if they would give
us six per cent, stock as a collateral security, with an engagement to allow it to be sold at par, so as to be absorbed by the
sinking fund, if not redeemed in specie. But they will not come
into such a measure until they have tried the effect of public
clamour against the Bank of the United States. If therefore
things should require it, and you were to authorize special deposits for a limited time and amount, and coerce such a condition, it might make the subject more manageable. If revenue
shall accumulate to the south, I do not know what we shall be
able to do with it. The cashier of the Bank has just received a
letter from the cashier at Charleston, which states that exchange on the north is at %\ per cent, premium, and not to be
had at that price. On England at 3-£ per cent, advance, but no
safe drawers. At Savannah probably no better, or worse, and
the Office perfectly regardless of our instructions, with no power
on our part to coerce them.
I am perfectly satisfied that with the present organization of
the Bank it can never be managed well. W e have too many
branches, and the directors are frequently governed by individual and local interests and feelings. For a time we must bear
with the branches, but I hope they will be reduced, and I hope
the presidents may be made to devote their whole time to the
business, engage in no other business, and receive a very liberal
salary, which would make them value their offices and be afraid
of losing them. A different management of several Offices
would in the business of each have saved and gained more than
would have paid five thousand dollars per year to each president of the branches. Nay there is no calculating the actual
loss and the loss of gain the Bank has sustained by the want of
competent and confidential men at the head of the branches. I
write this letter in great haste, as I am about to go to Baltimore in the morning, the Board of that Office having requested me to go there* You know, without doubt, by the clamour of
the delinquents which must have reached Washington, if not by
other means, that Mr. M'Culloh has been displaced. Mr.
Buchanan has resigned, and Mr. Donnell has been unanimously elected to succeed him. He, however, will probablv only conK

74
sent to fill it temporarily. The following is an extract of a letter from him to me, dated the 25th instant, the day he was
elected president. "The affairs of the Office are in a dreadful
confusion, and I tremble for the result. Acts have been practised beyond what could be supposed by even the greatest
enemy. In short, it is not possible to state to you on paper the
numerous facts and violations of trust that have been practised,
and I fear that added to all this there is want of morality to
surrender the whole of what is now in existence. The Board,
after full deliberation, resolved that I should address you on
the subject, and urge the necessity of your coming here without
a moment's delay." It is no doubt bad enough, as I have been
for sometime aware, and as I informed you in Washington, but
I incline to believe, and hope, the surprise of Mr. Donnell has
magnified it. It has been a most stupendous fraud. On some of
the authorized loans we added nominally 900,000 dollars, but
certainly and effectually 500,000 dollars, to the security of the
Bank, before I brought before the Board the question of Mr.
M'Culloh's removal.
I have great pleasure in saying that the government directors
have given the greatest assistance in all the measures calculated to save the credit and restore the circumstances and activity of the Bank.
I have the honour to be, sir,
With the greatest respect,
Your obedient servant,
(Signed) L. CHEVES,
T H E HON. W . H. CRAWFORD,

Secretary of the Treasury, City of

Washington.

Treasury Department 11th June 1819.
SIR,

Your private letter of 27th ultimo was received by due course
of mail.
The views which are presented in it are extremely interesting and have received that consideration to which they are justly entitled.
There can be no doubt that the difficulty of collecting the
revenue accruing from the customs will continue to increase

75
as the money in circulation shall be diminished. The accumulation of the revenue in the vaults of the banks will have the*
same effect upon the currency as the curtailment of bank discounts. The operation of both causes united cannot fail to re*
duce the circulation in a short time to the lowest point of depression of which it is susceptible. It is presumed, however,
that the safety of the banks will not require the reduction to be
pushed to that extremity. The interest of the community requires that it should not be reduced below what is indispensable
to secure solvent banks against the stoppage of specie payments.
Whether the revenue bonds can be paid with punctuality when
the circulation shall be reduced to that point is extremely problematical. The reduced premium which Spanish milled dollars
now bear in Philadelphia and New York indicates an approximation of the currency to a healthful state, which cannot fail to
aid in restoring confidence to Banks, which recent occurrences
in some of our cities have been calculated so strongly to impair.
Notwithstanding this favourable symptom I am fearful that it will
be necessary to resort in the course of the next quarter, to the
expedient suggested by you, of permitting the paper of the local
banks to be received to some extent as a special deposit. This
event, however, I am extremely solicitous to avoid, if it be practicable. Discounting upon the pledge of Louisiana stock, if
extended to all the Offices where that stock is held, would certainly afford some relief. As the Bank is now secure, and will
not make any use of the public revenue which may accumulate
in its possession, in its ordinary business, I think it will be adviseable to commence early next month the purchase of Louisiana stock by the commissioners of the sinking fund, in addition
to that of the three per cent, stock which has already been directed, but which has not yet been done with a view to the convenience and safety of the Bank. From the known sagacity of
the direction of some of the eastern banks, it is highly probable*
that their efforts will be directed to the purchase of that stock,
which would place them in a relation to the United States Bank
which might be productive of inconvenience to it, This view of
the subject, independent of the necessity of furnishing, as far as
practicable, the necessary circulation, to facilitate the collection
of the revenue, is sufficient to justify the adoption of the
measure. The amount of the domesticated Louisiana stock is

76
about equal to that part of the sinking fund which can be ap
plied to purchases of the public- debt within the year. Should
the whole sum subject to that disposition be so applied, the suni
necessary to meet the redemption of the Louisiana stock on the
21st October will but little exceed 2,000,000 dollars,
Inclosed I send you a statement of the amount of that stock
standing on the books of the different land offices. Inclosed
also is a statement of the revenue bonds falling due in the
third quarter. Perhaps the amount will be increased 10 or
15,000 dollars, by the statements of bonds yet to be received*
It may be useful to inform you that the bonds which fell due in
the first quarter amounted to 4,788,670 dollars, and that the
payments into the Treasury during the quarter, from imports
and tonnage, amounted to 4,352,819 dollars 74 cents. It is
probable that the difference between the amount of bonds due
and of the payments into the Treasury, will be greater in
the three succeeding quarters than in the first,
I will furnish you with a statement of the expenditures of
the war and navy departments for the next quarter, as soon as
one approximating to accuracy can be obtained. I am fearful,
however, that no great reliance can be placed upon any estimate which it is in the power of those departments to furnish.
If it is desirable on the part of the Bank to diminish the
issues of the notes of the Office at this place, I think there is no
doubt but that the bills of the banks of Philadelphia and New
York may be used to a considerable extent in discharge of demands upon the Treasury at this place. So far as they can be
used in this way, it would diminish the necessity of permitting
them to be received as a special deposit, and would be a much
more eligible mode of employing them.
I think it would at least be expedient to make the experiment, by way of ascertaining the accuracy of the suggestion^
I remain, with sentiments of respect,
Your most obedient sprvant,
(Signed)
W . H. CRAWFORD
LANGDON CHEVES, ESQ.

President of the United States
Philadelphia,

Bank,

77
Louisiana Stock Domesticated.
At the Treasury,
$
68,250 00
New
Hampshire,
1,000 00
Boston,
195,000 00
New York, .
454,000 00
New Jersey,
2,500 00
Pennsylvania,
654,000 50
Delaware,
700 00
Maryland, .
51,000 00
Virginia, .
2,950 00
South Carolina, .
25,653 50
No. 7.
A statement showing the amount of capital on which interest
or profits were accruing at the several periods therein stated.
1818.
February 18,
41,181,750 80
9,475,932 84
50,657,683 64
April 2,
9,475,932 84
41,325,523 15
50,801,455 99
9,436,250 43
April 30,
41,091,295 21
50,527,545 64
9,436,250 43
May 28,
41,240.818 20
50,677,068 63
9,430,926 60
July 6,
41,458,985 27
50,889,911 87
9,430,926 60
July 30,
40,010,285 43
49,441,212 03
August 27,
9,430,926 60
38,715,070 60
48,145,997 20
October 1,
7,425,549 12
38,622,445 43
46,047,994 55
October 29,
7,393,049 12
37,206,544 10
44,599,593 33

78
November 26,

7,393,049 12
36,227,499 84
43,620,548 96

1819.
January 4,

7,391,823 64
35,786,263 79
43,178,087 43

January 28,

7,391,823 64
35,627,445 62

February 25,

7,322,823 64
34,632,894 96

April 1,

7,160,210 71
33,480,025 94

April 29,

7,139,485 36
32,504,192 17

May 27,

7,139,485 36
31,735,002 95

July 5,

7,139,485 36
30,949,642 72

August 2,

7,252,951 34
30,720,888 83

August 30,

7,252,951 34
30,507,815 36

September 27,

7,252,951 34
29,392,668 39
1,375,087 86

43,019,269 26
41,955,718 60
40,640,236 65
39,643,677 5S
38,874,488 31
38,089,128 08
37,973,840 17
37,760,766 70

October 28,

November 26,

1,852,578 00
7,195,355 96
29,381,388 27
1,386,174 46
7,195,355 96
1,852,578 00
28,126,321 00
1,279,869 61
1,540,000 00

38,020,707 59

39,815,496 69

39,994,124 57

79
1820.
January 3,

9,045,558
28,061,400
1,487,080
1,540,000

45
19
77
00

January 27,

8,477,781
28,149,800
1,749,737
1,540,000

94
13
00
00

February 28,

8,477,781
28,155,731
1,785,719
1,540,000

94
00
37

40,134,039 41

39,917,519 07

00

39,959,232 31
April 3,

8,477,781 94
28,336,361 40
1,818,255 99
1,540,000 00

May 1,

8,459,347
28,533,621
2,075,964
1,540,000

40,172,399 33
38

26
90
00

40,608,933 54
May 29,

9,459,347 38
28,179,221 49
1,896,198 05
1,540,000 00

July 3,

9,812,672 77
27,841,337 84
1,712,553 51
1,540,000 00

July 31,

9,812,672
27,559,169
1,465,366
1,540,000

August 28,

9,172,554 45
278,008 00
27,391,990 00
1,055,120 36
1,540,000 00

41,074,766 92

40,906,564 12
77
14
20
00

40,377,208 11

39,437,672 81

80
October 2,

9,172,554
278,008
27,296,536
958,323
1,540,000

36
00
55
85
00

October 30,

9,157,604
278,008
26,931,389
1,083,097
1,540,000

15
00
93
86
00

November 27,

9,157,156
278,008
1,510,503
27,071,835
1,239,697
1,540,000

45
00
00
94
04
00

39,245,422 76

38,990,099 94

40,797,200 43
1821.
January 1,

9,155,855
2,025,760
27,370,786
1,508,653
1,494,248

66
00
21
54
71

February 26,

9,155,855
2,025,760
27,162,844
2,257,134
1,494,248

66
00
90
36
71

April 2,

9,155,855
2,025,760
27,069,049
1,865,946
1,494,248

66
00
13
26
71

April 30,

13,361,261
26,828,791
1,748,014
1,494,248

74
16
77
71

May 28,

13,361,261
27,022,250
1,576,043
1,494,248

74
72
83
71

41,555,304 12

42,095,843 63

41,610,859 76

43,432,316 38

43,453,805 00

81
June 30,

13,360,780 71
26,641,158 45
1,745,758 15
1,494,248 71

July 30,

13,320,780 71
26,243,784 92
1,480,593 08
1,425,852 97

September 3,

13,320,780 71
25,362,902 86
1,301,114 07
1,425,852 97

October 4,

13,320,292 46
25,057,186 94
1,193,652 12
1,425,852 97

November 1,

13,320,292 46
25,470,252 08
1,255,794 58
1,417,457 23

November 27,

13,320,292 46
25,647,637 27
1,412,070 62
1,417,457 23

43,241,946 02

42,471,011 68

41,410,650 61

40,996,984 49

41,463,796 35

41,797,457 58

1822.
January 1,

13,318,950 51
26,487,994 85
1,573,174 74
1,417,457 23
42,797,577 33

January 31,

13,318,950 51
27,133,786 74
1,987,384 25
1,417,457 23

February 28,

13,113,071 51

43,857,578 73

27,388,739 55
2,148,707 69
1,417,457 23
44,067,975 98

82
April 5,

13,112,554
28,180,672
2,565,470
1,417,457

81
53
07
23

May 2,

13,112,554
28,511,270
2,900,632
1,357,457

81
70
15
23

May 30,

13,112,554
28,561,209
2,928,819
1,357,457

81
73
59
23

July 1,

13,112,443
28,522,641
3,273,059
1,357,457

47
86
09
23

August 1,

13,112,031
28,127,026
2,996,024
1,357,457

37
26
70
23

45,276,154 64

45,881,914 89

45,960,041 36

46,265,601 65

45,592,539 56
No. 8.
Extracts from a Report of the Committee on the State of the
Offices, adopted 9th May, 1820.
There is also another subject, of very material importance, in
which the Bank may be assisted by this agency.* It is the
obtaining of a thorough and solemn examination of the state and
value of the debts due to the Bank in the States of Ohio and Ken5th. That the Offices of Chillicothe, Cincinnati, Lexington,
and Louisville, respectively, be requested to appoint commit
tees, consisting of the president, cashier and three directors, to
whom the pay list to be prepared for the 1st June next, shall
be submitted, which committees shall thoroughly examine into
the character and value of the debts clue to the Offices respectively, and report through their officers to this Board an accurate statement of the character and value of the debts due to
* The agency of the Cashier of the Bank in the western states, in 1820,

88
their respective Offices; in forming which they are particularly
requested rigidly and faithfully to class the debts under the
following heads:—
1st. Those which are undoubtedly good, distinguishing among
these, cases which are secured by real estate.
2dly. Those which are doubtful, and
3dly. Those which are bad; and thence to deduce, according
to their best and deliberate judgment, such an estimate of their
value, as may be relied upon by the Parent Board.
6th. That the agent, (with reference to the same pay list and
pursuing if he can, the same mode of deduction) from the inquiries he may make and the information he shall receive, form
a like independent estimate of the debts due to the said
Offices respectively, and report the same to this Board,
Copy of a Report of the same Committee, adopted on the same day.
The committee on the state of the Offices, considering an
accurate knowledge of the state and value of the debts due to
the Institution, as of great importance to the due management
of its affairs, and with a view of effecting a thorough examination and accurate estimate of them, recommend the following
resolve:—
That the Offices respectively, (except the Offices in the States
of Ohio and Kentucky, in relation to which a like resolve has
been adopted in connexion with other matters) be requested
to appoint committees, consisting of the president, cashier and
three members of the board, to whom the pay list to be prepared for the 1st June next, shall be submitted, which committees
shall thoroughly examine into the character and value of the debts
due to the Offices respectively, and report; through their officers
to this Board, an accurate statement of the character and value
of the debts due to their respective Offices, in forming which
they are particularity requested rigidly and faithfully to class
the debts under the following heads:—
1st. Those which are undoubtedly good, distinguishing, among
these, cases which are secured by real estate.
2dly. Those which are doubtful; and
Sdly. Those which are bad; and thence to deduce, according
to their best and deliberate judgment, such an estimate of their
value as may be relied upon by the Parent Board*

84
No. 9.
Estimate of the cost of completely finishing the Southern Portico,
Steps, Flagging, &c. of the Bank of the United States.
Dolls.
Marble in rough, .
.
.
.
5000
40 column blocks,
.
.
.
8000
20 blocks for architrave,
.
.
3000
Marble mason's wages,
.
.
6700
Superintendent's wages,
.
.
975
Labourers' wages,
.
.
,
300Q
Copper for roof, .
.
.
.
1000
Blacksmith's work,
.
.
.
200
Total cost,

27,875

Materials now in the possession of the Bank of the United States,
Dolls.
Hoisting machinery,
.
.
.
.
1000
Rafters sufficient for finishing the roof,
400
Workshops, scaffolding and ladders,
.
600
Blocks, ropes, crabs, shovels and spades,
800
Tools of every description and spars and shears, 600
3400
Philadelphia, August 26th, 1822.
(Signed)
W I L L I A M STRICKLAND, Architect

No. 10.
Statement of the Dividends and Profits of the Bank, from 1st
January, 1817, to 1st January, 1819.
Dolls. Cts.
July, 1817. Dividend, .
,
.
910,000 00
Less interest on funded debt, 675,426 50
234,573 5Q
Jan. 1818. Dividend,
.
.
. 1,400,000 00
Less interest on funded debt, 270,254 65
—
1,129,745 35

85
July, 1818. Dividend,
.
.
. 1,225,000 00
Less interest on funded debt, 209,318 27
—1,015,681 73
Jan. 1819. Dividend,
.
.
.
875,000 00
Less interest on funded debt, 193,459 56
681,540 44
Add interest on funded debt, 675,426
270,254
209,318
193,459

3,061,541 02
50
65
27
56
1,348,458 98

4,410,000 00
Add also, balance to credit of profit and
loss, January, 1819,
.
.
. 125,887 89
Less, balance of amount called permanent expenses,
.
.
.
96,199 17
29,688 72
4)4,439,688 72
Average semi-annual gain,
1,109,922 18
1,109,922 18

1,109,922 18

35,000,000)2,219,844 36
Equal to 6 - ^ per cent, per annum.

Statement of the Dividends and Profits of the Bank, from 1st
January, 1819, to 1st July, 1822.
Dolls, Cts.
July, 1821. To Dividends,
.
525,000 00
Jan. 1822.
Do.
.
.
.
.
700,000 00
July, 1822.
Do.
.
.
.
.
.
787,500 00
Contingent fund,
.
.
* 3,550,000 00
Carried forward^

5,562,500 00

86
Brought forward,
5,562,500 00
Balance, profit and loss account,
245,796 07
Paid on account called permanent
expenses incurred before 1819,
96,199 17
Commission and expenses on loan
obtained in Europe, .
.
50,000 00
Contingent interest,
.
. 1,279,520 54
7)7,234,015 78
Average semi-annual gain,

1,033,430 82

1,033,430 82
1,033,430 82
35,000,000)2,066,861 64
Equal to 5 90/100 per cent. per annum.

No, 11.
Statement of the expenses of the Bank, from its establishment to
1st July, 1822.
July, 1817. To current expenses, salaries included, at
the Bank and Offices Boston, New York,
Baltimore and Washington, 66,912 33
Fixtures, &c. at Bank U. S.
at Boston, New York, and
Baltimore, (a)
. . .
39,062 89
Commissioner's expenses
which were then settled
and paid, ( a ) . . . .
40,089 85
146,065 07
Jan. 1818.

Current expenses, . . . 144,355 28
Permanent expenses, (a) 43,743 40
188,098 68

(a) The expenses called "permanent" and not particularly designated,
consisted of the cost of furniture, bank note plates, &c. &c. which were
afterwards included in "current" expenses,

87
July, 1818.

Jan. 1819.

Current expenses, . . . 171,332 59 .
Permanent expenses, ( a )
14,281 60
-185,614 19
Current expenses, . . . 158,968 39
158,968 39

July, 1819.

Current expenses, . . . 193,522 11
Less expenses transporting
specie, . . . . . .
7,731 05

Jan. 1820.

Current expenses, . . . 167,305 49
Less expenses transporting
specie,
5,616 59

July, 1820.

Current expenses, . . . 149,147 70
Less expenses transporting
specie,
880 68

185,791 06

161,688 90

148,267 02
Jan. 1821.

Current expenses, . . . 130,110 98
Less expenses transporting
specie,
958 63

July, 1821.

Current expenses, . . . 141,807 57
Less expenses transporting
specie,
3,628 76

129,152 35

138,178 81
Jan. 1822.

Current expenses, . . . 145,018 94
Less expenses transporting
specie, . . . . . .
4,273 42
——140,745 52

July, 1822.

Current expenses, . . . 136,918 88
Less expenses transporting
specie, . . . . . .
1,307 03
---- 135,611 85

N. B. The current expenses subsequent to July, 1819, include
the expenses of new furniture for Louisville, New Orleans.,
Savannah, Charleston, Fayetteviile, Baltimore, Philadelphia
and Boston, incurred either on removals, or purchases of new
banking liouses; besides very heavy and unusual law charges,
growing out of the western and other suspended debts

88
Summary of the holders of the Capital Stock of the Bank of the
United States, up to 5th October, 1822.
Number of
Stockholders.

Maine, .
.
.
.
.
.
.
Massachusetts,
.
Rhode Island,
Connecticut,
New Hampshire,
Vermont,
New York,
.
.
.
.
.
.
New Jersey,
Pennsylvania,
Delaware,
.
.
.
.
.
.
Maryland,
District of Columbia,
.
.
.
.
Virginia,
.
.
.
. . .
North Carolina,
South Carolina,
Georgia,
.
.
.
.
.
Louisiana,
Kentucky,
.
.
.
.
.
.
Ohio,
.
.
.
.
.
.
Tennessee,
United States Navy,
.
.
.
.
United States Army,
.
.
.
.
Residence unknown,
Foreign,
.
.
.
.
.
.
President and Directors, Bank U. S.
United States,
.

35
232
36
. 103
35
5
257
38
485
23
306
53
263
55
420
.
42
38
38
.
11
5
5
1
21
142
.
2649

Shares

701
28,384
2,758
1,541
862
112
39,463
1,505
36,747
664
39,555
2,486
13,535
4,985
30,433
3,260
542
356
1,086
211
483
11
472
31,894
37,954
70,000
350,000