charter was at length obtained in 1791. One clause of it was that the bank should not emit any notes or contract debts payable in the State paper.
In point of time the charter of the Bank of Maryland was earlier than that of the Bank of New York, being dated 1790. The Bank of Providence, Rhode Island, was founded in 1791; the Bank of Albany, the Bank of South Carolina, unchartered, and the Union Bank of Boston in 1792. In the last year also the Hartford Bank was founded, the State reserving the right to take forty shares within twelve months. The historian of this bank thinks that its assets, at its outset, "consisted mainly of the promissory notes of stockholders endorsed by each other, with a moderate sum of silver, a light sprinkling of gold drawn from old hoards, and possibly a few notes of the Bank of North America."[1] One of the rules of this bank was: "What passes in the bank not to be spoke on at any other place." This expresses the mystery with which banking at this time was surrounded. Every bank was a secret society.
The Bank of Alexandria, Virginia, was founded November 23, 1792, with a capital of $150,000, increased in 1795, to $350,000. The lowest denomination of notes was five dollars. Its debts were never to exceed four times its capital. Its charter was to last ten years. It was given power for the summary collection of debts, which were not liable to the stay laws existing in the State at the time. It appears that this bank was not founded without occasioning alarm. Pope, of Kentucky, in the debate of 1811, said that the Virginians were known to be poor financiers, for they "were, a few years since, frightened at the very name of a bank. * * * * It required all the eloquence of [Brent of Virginia] to persuade the Legislature that the little Bank of Alexandria would not sweep away their liberties." A month later the Bank of Richmond was founded, with $400,000 capital, to last until 1804, with similar provisions. A statement is met with that from 1787 to 1804 there were no banks in Virginia, except the branch of the United States Bank at Norfolk, founded in 1799, and that the circulation was metallic.[2]
It should be noticed that when banks began to be founded, the notion of a national bank for each State was the conception on which they were constructed. The Bank of Massachusetts was expected and intended by its founders to be the only bank in Massachusetts, and the Bank of New York was founded on that plan; whether it should be called a hope or an intention is difficult to decide. In the Southern or Southwestern States, this notion of a Bank of the State became the source of a great number of institutions which will deserve our particular attention. Such a Bank of the State might exist, like the Bank of England, or the Bank of France, although there might be any number of other banks by the side of it in the same State. One consequence, which causes very great perplexity in the case of the great Banks of the States, is that the nomenclature becomes confused. We find a Bank of South Carolina, a State Bank in South Carolina, and a Bank of
