Panic of 1857 - Condition of Kentucky Banks

Condition of the Kentucky Banks.

The latest statements of the condition of the Kentucky banks were made on the 1st of July last. The Louisville Courier makes an abstract of the aggregate statement of which we avail ourselves. On the first of July, 1857, the Kentucky had notes in circulation to the amount of $12,071,274. Since that time they have withdrawn considerable sums from circulation, so it is not now probable that their notes are out to a greater sum than $10,000,000. But admit that the same amount is out now that was afloat on the 1st of July, and our banks have assets to the value of $31,551,283.46, out of which to make good their circulation. These assets consist of discounted bills of exchange, promissory notes, city bonds, State bonds, debts due from other banks, real estate, coin and notes of other banks. Surely thirty-one millions of such assets are good security for twelve millions of notes, when, too, over for millions of these assets are gold and silver. There is no danger, therefore, of our banks breaking, and if any old woman is anxious about it the sooner her anxiety ceases the better it will be for her health and sleep and fortune.

The assets or means may be more specifically stated thus:

Gold and Silver .... $4,220,623.08

Notes of other banks .... $631,134.00

Means deposited in foreign banks subject to slight exchange .... $1,950,456.08

Debts due by other banks .... $3,045,877.72

Immediate means .... $18,042,090.92

To this is added —

Discounted notes and bills of exchange .... $19,481,602.33

Aggregate means, exclusive of real estate .... $29,530,693.15

In Kentucky there is no distrust of the banks, and no run by depositors. The run is by brokers for specie, and all the banks have to look to, is their circulation. Now it will seem that if the foregoing statement is accurate, our banks could redeem, on presentation, in specie or exchange, every note outstanding and still have on hand nearly $20,000,000 of notes and bills, nearly all good and rapidly maturing.

The Kentucky banks, occupying this impregnable position, are secure against all assaults, and cannot for a moment entertain the idea of suspending.