taken in execution, and that it should not be sold unless two-thirds of the valuation was bid.
The act for the regulation of banks was amended February 21, 1843. No one was allowed to be a director in two banks; not more than one member of a firm might be a director in the same bank; no loan might be made for more than six months; no dividend might be made when the capital was impaired; the stockholders were to be individually liable, except where the depositors and the bank might otherwise agree as to deposits; it was unlawful for the president or cashier to deal in stocks. In this act five new banks were organized under the law, and five others submitted to it. This act was considered too stringent, and banking associations refused to organize under it, hoping and expecting relaxation. February 15, 1844, three banks which complained of the restrictions of this law and asked extensions of their old charters obtained what they asked for, on condition of consenting to individual liability and keeping one-third of their circulation in specie. Immediately afterwards three others took the same step.
Of the twenty-three banks in Ohio, with a capital of $7 millions, the charters of thirteen expired by limitation January 1, 1843, and of two more, a year later. The remaining eight had a capital of $3.4 millions, of which about half was owned in the State. In December, 1843, the Commissioners said: "There probably never was a time when the banks of the State were in a better condition than the present."
Speaking of the ending of these thirteen banks, the Governor said, a year later: "Instead of the ruin and disaster predicted from the event, business and enterprise have continued to revive unimpeded in their progress; thus, as the banking system has literally rotted down in the sink of its own folly and corruptions, the prosperity of the country has received new life. Industry and enterprise, relieved from the bondage of banking operations, are recovering their energies with renewed vigor."
The Senate, in 1844, called upon the Bank Commissioners for an estimate of the loss of the people of that State by banks since 1831. The answer had no value on any point but one,—the loss by the circulation, which was put at $1.4 millions.[1]
The Bank Commissioners, in 1844, gave a list of forty-seven banks in that State which had failed. The Governor in that year expressed himself strongly opposed to the New York free banking system. One of the most famous of the unauthorized note-issuing companies, the Granville Alexandrian Society, came to the surface once more March 8, 1845, when an act was passed to settle doubts whether the note-holders could enforce payment against it, since it never had a right to issue, and whether it could collect debts due to it for its banking business; both were provided for, in order to
- ↑ The Governor quoted, without stating his authority, statistics of the losses to the whole country by the revulsion, 1837 to 1843, as follows: bank circulation and deposits, $54 millions; bank capital, $248 millions; company stock, $80 millions; depreciation of State stock, $100 millions; real estate, $300 millions.
