Page:A History of Banking in the United States.djvu/400

 interest of the State." The debts which had been extended to 1846 were now extended to 1847, if one-half was paid before June 1, 1846, provided that the Commissioners were of opinion that the State would not lose. No more notes of the Bank of the State were to be burned unless it was necessary to do so to stop depreciation. A report of the trustees under this act made December 20, 1847, showed that they had accomplished much towards the liquidation of the bank. They had collected $3.4 millions, and they estimated the remainder, which was collectible, at $2.2 millions. They had taken up in their collections, of the circulation of the bank, $1,142,000. The amount still outstanding was $457,177. The notes were at that writing nearly equal to specie.

In 1850 the Legislature began to pass special acts, extending debts to the Bank of the State on behalf of individuals.

The trustee of the Bank of the State was directed, February 4, 1852, to sell the stock owned by the State in the Bank of Mobile, and to pay off the $600,000, five per cent. bonds, which had been issued wherewith to buy it. When this should be done the capital of the bank might be increased from $1.5 millions to $2.5 millions; two-fifths being reserved for the State while the charter runs. Five days later the charter was extended twenty years from the date of expiration, $100,000 bonus was to be paid in installments of not less than $5,000 per annum.

It appears that the earnest hope which had been expressed by the Governor in 1845 that the notes of the Bank of the State would not be re-issued was not fulfilled. On the contrary they seem to have circulated until the civil war. They could only be regarded as pure bills of credit after 1847. An act of February 16, 1854, ordered the trustee to give notes fit for circulation in exchange for the worn notes in the State treasury; the latter to be burned by State officers. The unmutilated notes under $5, which were in the treasury, were to be given out in exchange for large notes to any one who desired them, and the small notes were to be receivable by the State. An act of February 14, 1856, about loans to railroads, shows the notes of the Bank of the State and branches still in circulation. The Governor, in his message of expressed the opinion that the time had come when the circulation of the old Bank of the State notes should no longer be tolerated. At length, January 22, 1858, a law was passed that all the notes of the Bank of the State and branches in the treasury should be burned, and also all those which should come in thereafter. Laws for the extension of the Bank of the State in liquidation were repeated until the civil war.

.—The Legislature of 1840 turned against the banks. Some charters were repealed. February 6th post-notes were forbidden; any bank which issued them was to forfeit its charter; resolutions were adopted, February 13th, in regard to the prevailing distress, the causes, and the remedies. The chief cause was declared to be "excessive banking." They declared that paper issues stimulate speculation and extravagance; that it was the duty of the United States and the State governments to remedy