for interest on loans $29,719, and obtained in dividends $22,867.[1] The date, July a 25, 1783, is given as that upon which private individuals had taken up all the shares originally subscribed by the government.[2] It is safe to say that this, the first "specie paying, convertible bank note bank" in this country, never could have started but for the silver borrowed by the government from France and placed in its vaults.
There was much doubt about the power of Congress to pass an act of incorporation. The Virginia delegates reported to the Governor of that State that they had consented to the act on account of the utility of the bank, but that the States ought to ratify the act of Congress. The bank determined to seek a charter from Pennsylvania. Objections were made in the Assembly that the charter was perpetual; that the bank had power to hold real estate; and that the president of it had encouraged negotiations with General Howe during the war.[3] Nevertheless the act was passed April 1, 1782. An act had been passed a fortnight earlier, in that State, making it felony to counterfeit the notes of the bank.
In 1782 a proposition was made to Robert Morris to found a bank in New Hampshire. He declined and nothing came of it.
In 1784 and 1785, the Bank of North America earned 14 per cent. In the former year it enlarged its capital by issuing 1,000 more shares at $500 each. This led to the foundation of a rival institution which was on the point of being chartered, when the new subscription was extended to 4,000 shares at $400 a share, and those who had already paid in $500 received $100 back with interest. At the same time the affairs of the bank became disordered on account of over-extension of its business in the attempt to defeat the new bank. For the safety of the community "it became absolutely necessary to drop the idea of a new bank, and to join hand in hand to relieve the old bank from the shock it had received. Gold and silver had been extracted in such amounts that discounting was stopped, and for this fortnight past not any business has been done at the bank in this way. The distress it has occasioned to those dependent on circulation and engaged in large speculations is severe; and as if their crop of misery must overflow, by the last arrival from Europe, intelligence is received that no less a sum than £60,000 sterling of Mr. Morris's bills, drawn for the Dutch loan, are under protest. It is well known that the bank, by some means or other, must provide for this sum. The child must not desert its parent in distress; and such is their connection that whatever is fatal to the one must be so to the other. * * * I have had several interviews with our friend, Gouverneur Morris. He is for making the Bank of New York a branch of the Bank of North America; but we differ widely in our ideas of the benefit that would result from the connection."[4] Disquieting rumors about the bank had been current in Holland in the previous January, where it had been reported that the
