1842, which was payable in the interior of any southern or western State.[1]
The exchanges in May, 1842, at New York, were as follows: England, eight and one-quarter premium; Boston, Philadelphia, and Baltimore, par or one-quarter discount; Virginia, five and one-quarter; Charleston, one and one-quarter; Augusta, two; Savannah, two; Mobile, twenty-five; New Orleans, six; St. Louis, five; Cincinnati, eight; Nashville, fifteen; treasury notes, one-quarter;—discount.[2]
The Governor in his message, January, 1843, said that the bonds held for the State circulation were worth at par $4.6 millions; that their market value was $1.6 millions; all the mortgages and stocks together were worth less than the circulation by $0.5 million. A year later his statement showed that the securities were a little in excess of the circulation. As to the safety fund, it was in arrears $579,353, for the notes of the insolvent safety fund banks.
In 1843, the office of Bank Commissioner was abolished, and the duties were transferred to the Comptroller. Every chartered bank was required, on July 1, 1843, to deliver all its bank-note plates to that officer, and to make a return to him of all bank notes created by it then in existence. All notes issued before that date were to be countersigned by the Comptroller before July 1, 1844, or to be redeemed and destroyed in his presence. After that he was to cause to be printed, countersigned, and registered such notes as each bank might require, being within its lawful limit. Every bank in the State was to make quarterly reports to him, and he was to appoint an examiner for any bank whenever he thought there was reason to do so. The Comptroller remonstrated against this last provision.
The general banking law was so amended that only bonds of the State of New York could be deposited as security for circulation. The terms were so stringent that bonds of the United States were excluded.
Ninety-three banks were incorporated under the general banking law before 1844. Of these eight failed to organize, twenty-six were closed by the Comptroller, who redeemed of their circulation $1,153,984, at a cost of $881,070, leaving $27,974 outstanding. The stocks on deposit, January 1, 1844, at the average value of the preceding year, just about equaled the circulation which had been issued against them.
The provision of law by which country notes might be redeemed at a discount of one-half of one per cent. led to a new device. The Comptroller, in his report of, mentioned a case of a bank organized under the free banking law in an out-of-the-way place in Orange county. Its nominal president lived in Connecticut and all its business was done in New York City. The arrangement was devised in order that it might make one-half of one per cent. on such of its notes as were presented for redemption in New York City.
