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Due from Bank of Burlington

124 25 Bills of other banks

14,381 67 Specie

.. 5,502 51

$245,069 58 Capital paid in

80,000 00 Circulation

145,159 00 Due depositors

8,270 06 Profit and loss

8,089 71 Dividends unpaid

1,169 20 Due bank of Poughkeepsie • Farmers' bank, Orwell

71 20 6 Bank of Troy

80 00 " Farmers' bank, Troy

175 00 46 Bank of St. Albans

351 46 " Bank of Middlebury

1,700 00

- $245,069 58 September 12, 1838.


RESOURCES. Bills discounted

201,815 18 Bills of other banks

8,226 50 Funds in City bank, Boston

54,652 42 Suffolk do do

3,000 00 Farmers' bank, Troy 26,922 95 Treasury notes

3,109 57 Real estate

1,871591 Specie

7,835 41

$307,433 94 LIABILITIES. Capital paid in

100,000 00 Circulation

182.681 00 Due depositors

14,338 45 Dividends unpaid

886 00 Due Bank of Middlebury

63 18 Manchester

200 00 Profit and loss

9,265 31

- $307,493 94 September 15, 1838.


RESOURCES. Bills discounted

186,41€ 70 Real estate

3,992 34 Bills of other banks

4,725 25 Specie

10,634 53 Checks and other cash items

6,994 57 Deposites in New York and Boston banks

36,800 50

- $249,563 89 Deficient in funds

8,938 67

-- $258,502 56

Capital paid in

92,470 00

139,292 00 Due depositors:

25,950 56 Dividends unpaid

790 00

- $258,502 56 September 20, 1838. In consequence of the severe pressure upon the business of the country, occasioning universal embarrassment, the foregoing banks were compelled to suspend paying specie for their bills and other liabilities in May, 1837. This suspension was permitted to continue no longer than the cause which occasioned it existed. In May, 1838, resumption generally commenced, and it is grr tifying to believe, with means available and sufficient, promptly to discharge all their obligations to the public.

Domestic bills or drafts, form nearly one half the amount of the item, “bills receivable.” The greatest proportion of these in amount will reach maturity at Boston, New York, Albany or Troy, where they are payable within sixty days. This paper, being generally founded on business transactions and paid in full when due, gives to the banks an easy remittance to those cities for the redemption of their notes-one which, in ordinary times, can be relied upon for this purpose. These domestic bills, with the immediate means in possession of the banks, show their ability to pay their liabilities to the public, while the balance of potes discounted, and other effects, seems to be quite sufficient to secure to stockholders a return of the capital, with a reasonable profit. The presert arrangement existing between most of the country banks in New England and those at Boston, gives to these domestic bills or drafts an additional value:-compelled as they are to redeem almost the entire of their circulation at par, in that city, where cash funds are from week to week absolutely necessary, these drafts answer the full purpose of specie, saving to the institutions themselves the risk of a money remittance, or the expense, trouble, uncertainty and risk of keeping the necessary specie funds for a redemption at their counter. The banks on the west side of the mountain are generally adopting the policy of keeping a considerable proportion of their debt in ihese domestic bills or drafts. It is one, which in the present state of the business of the country may be safely commended, and out of which no serious evils can be anticipated.

The capitals of the banks in this state are generally small, consequently they cannot accommodate individuals with permanent loans, and at the same time give the necessary facilities to the daily operations of the business community. The latter seems to be the legitimate object of their incorporation, and no course, it is believed, can more surely effect it, than by giving to these domestic bills or drafts a favorable consideration, the money arising from which, being almost exclusively devoted in aid of the industry and sale of the products of the state.

My attention was called to the Windsor bank on the 31st March last, and upon an investigation I found its condition to be as follows: Total amount of bills issued

8552,180 Amount cancelled and destroyed 366,926

-- $185,254

Bills on hand in the bank
Bills in circulation

72,736 112,518


Bills discounted

139,595 37
Bills in bands of agents

2,450 00 Balance due on book

904 51 Funds in agent's hands, Boston 70,695 76 Bills of other banks

1,814 00 Specie

528 73 Banking house

2,000 00

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Capital paid in

80,000 00

112,518 00 Due pension agent

12,985 00 Due depositors

859 25 Profit and loss

11,626 12

--- $217,988 37 There has been no alteration in the condition of the Windsor bank since my examination in April last, except the reduction of the bills » receivable by payment in Windsor bills to the amount of $18,199 00.

From the best information I could obtain, I believe that $80,000 of the item “bills receivable” will not be realized, as also the item of $70,695 76 " lunds in agent's hands, Boston' - making together a probable loss of $150,695 76. The failure of this bank, it is believed, inay be charged to the practice adopted by the board of directors, permitting one of their number to control its operations and become its principal debtor to a ruinous extelt-and also, in placing its funds in Boston in the hands of an individual, and as it proves, irresponsible agent, instead of confiding them to the care of a banking institution of known and undoubted solvency. Believing it my duty to do so, I requested the State's Attorney for Windsor county, to present the case of the Wind. sor bank to the consideration of the Supreme court of this State, under the statute in such case made and provided.

In all cases where the practice of placing funds in the hands of inviduals, for the redemption of bills, has been adopted by banks, I have recommended a withdrawal of the funds and the appointment of some strong bank in their stead. The latter mode, it is believed, better secures the public, as also the banks themselves, against the probability of los, which, as in the case of the Windsor bank, would be fatal to its continuance, or so diminish its funds as seriously to injure its credit. All of which is respectfully submitted.

HARRY BRADLEY, Bank Inspector. Montpelier, Oct. 11, 1838.

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