Page:A History of Banking in the United States.djvu/451

 The banks of New York State succeeded at last in establishing an "Assorting House" at Albany, by agreement, on the 5th of April, 1858. All the notes were to be redeemed at one-fourth of one per cent. discount and paid on the following day at Albany, Troy, or New York.

In January, 1862, the Canal Department of New York had $2.5 millions on deposit in banks. Of this amount nearly $0.5 million was unavailable, of which $130,000 was represented as hopeless.

When the last safety fund charter had expired, in 1866, there remained $129,499 of circulation of the last four banks which had failed still outstanding. After paying the last of the State bonds issued to meet the responsibilities of the fund, there was sufficient in the fund to pay forty per cent. of those notes. So few of them were presented, however, that the remaining sixty per cent. was paid on those which were presented. A final residuum of $13,144 was paid into the State Treasury.

The Constitution of 1844 required a three-fifths vote in each House for granting or renewing bank charters, which were also to be limited to twenty years' duration.

In 1855, the bank circulation was made a preferred debt, for which, according to each charter, all the assets were pledged; also each stockholder was liable for double his stock, and the directors were individually liable without limit. It was reported, in 1857, that all the banks under the General Banking Law of February 27, 1850, were trying to get special charters. The free bank system had fallen into disfavor in New Jersey, and was being abandoned.

March 7, 1866, the Comptroller reported that thirteen banks, organized under the General Banking Law, were winding up; six banks, having obtained charters, were winding up business under the General Banking Law; seven were being settled by decrees from the Court of Chancery.

.—A general act for the regulation of banks was adopted April 16, 1850. It was a codification of the old rules of banking without a safety fund or stock deposit. It provided for a Suffolk system, with centers at Philadelphia and Pittsburgh, and contained a very stringent and comprehensive section against the circulation in Pennsylvania of notes for less than $5 issued by anybody outside of that State.

A great number of suits were brought against the Pennsylvania and Pennsylvania and Ohio Railroad Companies, in 1854, for passing foreign bank notes under five dollars. These suits were sustained by private individuals, and penalties to the amount of $30,000 were recovered. The Legislature passed an act to unite the suits into one for each company, on which the penalty would be $500, but the Governor vetoed it. The companies then caused the prosecutors to be indicted for conspiracy, and they were convicted and imprisoned.