CHAPTER XIII.
Measures and Events Antecedent to the Crisis of 1837.
§ 1.—The United States Bank of Pennsylvania.
HE Committee of Stockholders to investigate the Bank of the United States, January 4, 1841, said: "The origin of the course of policy which has conducted to the present situation of the affairs of the institution dates beyond the period of the recharter by the State." We shall therefore use the information which that Committee obtained in regard to the internal history of the Bank, so as to present both that and the external history at the same time.
"When it was perceived," the Committee go on to say, "that the charter of the late Bank of the United States would not be renewed or extended by Congress, the president and directors commenced winding up its concerns, and among the first measures taken to that end was to sell or dispose of, as far and as speedily as could be effected, the assets of its several branches. This was generally done to State banks, who gave for them their obligations, payable by installments at distant periods. At the same time the policy was adopted of converting the active debt into loans upon the security of stocks, by which permanent investments might be provided for the capital of the bank during the long period of its anticipated liquidation." On the 6th of March, 1835, "the president submitted to the Board a general view of the situation of the Bank, its means and liabilities, its circulation and deposits, and the probable future demands upon it, showing its ample resources and power of expansion; whereupon" the Committee of Exchange, which was composed of three directors, appointed by the president, were authorized by the Board "to make loans on the security of the stock of this Bank, or other approved security, and if necessary at a lower rate than six, but not less than five per cent. per annum." "This delegation of power to the Exchange Committee was never expressly and formally renewed under the new charter, unless it be considered as included
