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We know there are instances where the public interest would be best subserved by the incorporation of new banks, and it is by no means our intention to prejudice such applications by the foregoing remarks in relation to the increase of capital.
If it were not for the apprehension that our local legislation would be found inadequate to effect the object desired, we should be inclined to add one further suggestion. Being perfectly sensible, as we have heretofore frequently remarked, that public confidence in a paper medium must chiefly depend upon its free convertibility into coin at all times, we think the character of the currency would be improved if there could be infused into it a greater proportion of specie, by gradually withdrawing from circulation our bank notes under five dollars. Such a measure would throw a large amount of specie into circulation among the community, and furnish a most valuable resource for the banks whenever a call for specie should occur. But the difficulty lies in the enforcement of such a law, so long as none such exists in the neighboring States. The legislature can act with effect upon our banks, to prevent their issues, but not easily upon individuals to restrain them from receiving small foreign notes.
In the city of New York, notwithstanding our law now prohibits the circulation of foreign bank notes under five dollars, they form a very large if not the principal amount of small bills in circulation. The experiment has been tried in Pennsylvania, and is said to have succeeded reasonably well. It might do so here, but we should apprehend more difficulty in consequence of our much more frequent and extensive intercourse with the neighboring States,
Connected with this subject, and as a measure necessary to carry it into full effect, the equalization of the standard value of gold and silver is exceedingly important. The Congress alone has the power to effect it.
All the banks chartered at the last session of the Legislature, have gone into operation, and we now have in operation in the State, besides the three branches of the United States Bank, sixtynine banks and two branch banks, subject to the bank fund law, and ten banks not subject to it.
The aggregate capital of all the State banks, as will be seen by the statements hereto annexed, is 827,846,460.
The bank fund, including the contributions due to it on the first instant, (which it is presumed have been paid,) amounts to about the sum of $290,000. When the payments of this year shall have been invested, as they will be soon, the annual revenue of the fund will amount to about $13,000. The contributions of the next year will probably raise the capital to upwards of $400,000, and the revenue to $18,000; and the increase will be in that ratio until the capital rises to about $700,000, independent of the additional re, ceipts which may be expected from new capital to be created. Albany, January 31, 1834,
LIST OF BANKS
In the State of New-York subject to the Bank Fund law, in operation on the 1st Jan. 1834.
503,253 50,000 1,688,822
750,000 | 204,908
112,500 4,126,292 369,496
1,426, 249 82, 822
485,928 15,971 37,500
488,037 26, 297 443, 208 10,104 355,744
68 | 22,017
4,075 30,376 27.470