IN ASSEMBLY,

February 6, 1833.

REPORT

Of the Bank Commissioners on the resolution of the Assembly of the 28th March, 1832.

February 5th, 1833.

To the Hon. C. L. LIVINGSTON,

Speaker of the Assembly.

SIR,

We herewith transmit to the honorable the Assembly the inclosed report and accompanying documents, in compliance with the resolution of that body of the 28th day of March, 1832.

Bank Commissioners of the State of New-York.

REPORT, &c.

To the Honorable the Legislature of the State of New-York. The Bank Commissioners, pursuant to a resolution of the Assembly, of the 28th March, 1832, by which they were required to report to the next Legislature the name and place of residence of each stockholder in the several banks in this State which have been incorporated since the first of January, 1829, together with the amount of stock held by each person respectively, on the first day of September, 1831, and the amount held by them on the first day of September, 1832; and whether said stock so held is on their own account or in trust for others, and if in trust, for whom: Also the names and residence of all persons, or the name of any body corporate to whom any stock in either of said banks is hypothecated, and the amount of such hypothecation: also the dividends made by each of said banks during the year, and the surplus profits, if any, as the same shall appear on the books of said banks,"

RESPECTFULLY REPORT:

That the schedules hereto annexed, being a list of stockholders of the banks mentioned in said resolution, with their places of residence, and amount of stock on the first days of September, 1831 and 1832, and a table shewing the amount of dividends for the year ending on the first of September, 1832, and the amount of profits on hand on that day, are supposed to contain the information intended to be sought for by the resolution.

Being authorized to report to the Legislature such abstracts and statements as we may deem useful, we have thought ourselves at liberty to comply with the resolution, notwithstanding the strong language of the 25th section of the bank fund law, which prohibits us from disclosing information obtained in the course of our examinations.

That part of the resolution which seeks information in regard to the hypothecation of stocks, and of stocks held in trust, cannot be answered from any entries appearing upon the books of the banks. No entries are generally made of such transactions, on the books of the institution whose stock is thus hypothecated or held in trust, and the transaction is generally one between individuals, with which the bank has no concern, and not often any knowledge.

The only mode of acquiring full and accurate information upon the subject, would be by an examination of the stockholders themselves, which it would be almost impossible to make; and we have not considered ourselves called upon by the terms of the resolution, or by any apprehension of danger, to make the attempt. But so far as our knowledge of these transactions extends, we know of no instance of the hypothecation of stocks, or of stocks held in trust, except for fair and legitimate purposes, nor any instance of the kind in the slightest degree prejudicial to the standing or charaçter of either of the banks, and the subject is one upon which we have found nothing like attempted concealment on their part.

From information casually acquired, we could mention several instances of stocks pledged to secure temporary loans of money, made for the purpose, generally, of anticipating investments, and several other instances, where individuals engaged in active business, instead of withdrawing capital from their ordinary business to invest in stocks, have procured other capitalists to advance the funds, and hold the stocks in their own names, under a contract to transfer upon payment of the par value and interest. Such we understand to be the case with regard to the stock in the Ithaca Bank, held by Mr. Astor, and there are other instances of the same kind; but we know of no stocks so held in trust under any suspicious circumstances, nor any hypothecations by individuals for any other purpose than that of anticipating their means, or for an amount beyond their ability to pay.

The information we have upon the subject is not sufficiently authentic to form the basis of a report, and is entirely insufficient to enable us to give any thing like a full and perfect statement of the different cases.

And inasmuch as injustice might be done to individuals by misstatements founded upon facts more or less indefinite and uncer

tain, we have thought it would be improper to attempt a specification.

In some instances, where the banks have gone into operation since the first of September, 1831, and the stock ledgers were not opened until after that time, we have not been able to procure the list of stockholders as it stood on that day, and in those cases have taken it as it was at the time of commencing operations by the bank, or as near that time as practicable. In the case of the Broome County Bank, the original distribution is given, that being the most authentic list near the time required.

The surplus on hand, as shewn in the annexed table, includes all the undivided profits of each bank since the commencement of its operations, and is the accumulation, in some instances, of nearly three years' business. In estimating the real amount of surplus, a deduction ought in most instances to be made for bad and doubtful debts not charged to the account of profit and loss, and probably many debts now estimated safe, may eventually become chargeable to that account. These banks have all gone into operation recently, and have not yet had sufficient time and opportunity to test the solidity of their debts.

It should be remarked also, that the amount of surplus reported includes the discount upon the discounted paper of the banks for the time it had to run after the first of September. The discount is carried to the credit of profit and loss when the note is discounted, but is not in fact earned until the note arrives at maturity. The proper average deduction to be made from the surplus reported on this account, we estimate as equal to two per cent upon capital.

The amount contributed to the bank fund also, is not deducted from the profits, it being considered as property belonging to the bank, until the fund shall become liable for the payment of losses. CHARLES STEBBINS, GEORGE R. DAVIS,

LEWIS EATON,

Bank Commissioners of the State of New-York.