Fayette County, Illinois - Chapter 5: Banks, 1878

Section 1. Be it enacted by the people of the State of Illinois represented in the General Assembly. That a bank of the State of Illinois shall be estab¬ lished at the seat of government, and shall be removed with the same; the capital stock of which shall not exceed two millions of dollare, to be sub¬ scribed by individuals and corporations, and divided into shares of one hun¬ dred dollars each, and of two million of dollars to be subscribed by the State of Illinois, whenever the legislature thereof may deem it proper to subscribe the whole or such part thereof as the condition of the treasury may justify, and the books for the subscription of state stock shall always be ana remain open; and subscriptions towards constituting the said individual and corpo¬ ration stock, shall be opened at the places and times and under the superin¬ tendence of the persons hereinafter mentioned, which subscription shall remain open until three hundred thousand dollars shall be subscribed; and it shall be lawful for any person, co-partnership, or body politic to subscribe for such, or as many shares as he, or she, or tney may think fit, not exceed¬ ing five hundred.

Sec. 2. Be it further enacted, That all those who shall become subscribers to said bank, their successors and assigns shall be, and are hereby created and made a corporation and body politic, and by the name and style of the " President, Directors and Company of the State Bank of Illinois," and shall so continue for and during the space of twentv-five years, from and after the passage of this act, and by that name shall be, and are hereby made, able and capable in law to have, purchase, receive, possess and enjoy, and retain

Sec- 5. Be it further enacted, That as soon as the sum of $15,000 shall have been received on account of subscription to the said stock, notice there¬ of shall be given in two newspapers printed in this state, specifying a time and place within the town of Kaskaskia, at the distance of thirty days, for the election of directors on the part of the individual stockholders.

Sec. 9. Be it further enacted, That books for subscription to the capital stock of the said corporation shall be opened on the first Monday in April next, at the following places: At Kaskaskia, under the direction of the president and directors, who shall be appointed by the General Assembly; at Golconda under the direction of James E. Willis, Robert Hancock and Joshua Scott; at Edwardsville under the direction of Benjamin Stephenson, John Todd and Robert Pogue; at Harrisonville under the direction of Alexander JamiBon, Thomas James and Jesse W. Cooper; at Bellville under the direction of Robert K. McLaughlin, William Glasgow aod Thomas Cohen; at Vienna under the direction of James Finney, James Bane and Aaron Brown; at Carlisle under the direction of John H. Lambert, John Kain and Charles Slade; at Carmi under the direction of James Gray, Leonard White and James Ratcliff; at Palmyra under the direction of Seth Gard, Jarvis Hazleton and William Becham; at Shawneetown under the direction of John C. Rives, Thomas Sloo and John Marshall; at Palestine under the direction of William Logan, Joseph Mitchell and John Dunlap; at Jonesborough under the direction of Thomas Cox, Abner Field and John Hacker; at Brownsville under the direction of Timothy Nash, John An¬ keny and William Boon. No one person, or corporation, or partnership commissioners, at the end of thirty days after the opening of the books, shall give notice thereof to the president and directors, and also the names of the subscribers, together with the kind of money they may have severally paid, and send the same to the president and directors at Kaskaskia, noting the day on which each subscription was made; it shall be the duty of the said president and directors, including those elected by the stockholders, to cause to be converted into specie without delay such bank notes as may have been paid in by the subscribers at the cost and risk of such subscribers, and until they shall have received fifteen thousand dollars in specie they shall not issue any notes signed by their president and cashier, or either of them, ********

Sec. 1. That in lieu of gold and silver, or bank notes of banks in the western country, paying specie, the subscribers to the capital stock 6f the State Bank of Illinois, may at the time of subscribing, pay the first instal¬ ment in warrants of the auditor, drawn on the treasurer of the state; which warrants, from the time of being paid in, shall bear an interest of six per centum per annum.

surer of this state, when in his opinion, the treasury is able to redeem such warrants, to give notice thereof in some public newspaper printed in this state, for three weeks in succession; upon which notice the interest is to cease and determine.

After the close of the second war with Great Britain the country became flooded with bank paper, an irredeemable currency, - this paper, particularly in the west, was of little value, and the country was almost without cur¬ rency.

In the years, 1819,1820 and 1821, property in Illinois was almost as value¬ less as the currency. Cows sold for four or five dollars per head, and wheat thirty-five and forty cents per bushel. Com was in many localities selling at ten cents per bushel. In the early part of the session of 1821 the legislature conceived the idea of creating a State Bank formed on the credit of the state This Bank was to have a capital of half a million of dollars, and to issue in the beginning only three hundred thousand dollars. The State, through the directors were to manage the main Bank and the branches, and the whole to remain under the control of the General Assembly. Money was to be loaned to no individual on personal security in sums above one hundred dollars, larger sums to be secured by real estate at two-thirds its value. The notes drew interest at the rate of 6 per cent, per annum. A principal bank was established at Vandalia, and four or five branches in other places.

The paper was made receivable for all taxes, state debts, Ac. The coun¬ cil of revision had to pass on all bills, and approve or reject them. The bill was presented to the council, and three of the five vetoed it and returned it to the house of representatives with their objection. Governor Bond, Judges Phillips and Reynolds, disapproved of the measure. Judges Wilson and Brown, were in favor of it.

The General Assembly were disappointed with the action of the Council, and passed the law by a coostitutional majority, over the objections of the Council. The charter became the law, and the Bank went into operation. The paper never was at par, and sunk, at times, down to twenty-five cents on the dollar.

The Bank lingered out a miserable existence, never observing its promises, or meeting the expectations of its friends, and was wound up in 1831. The following amusing incident occurred in connection with it. The legislature was very much infatuated with the Bank, and the Journals show that a resolution was passed, requesting the secretary of the treasury of the United States, to receive these notes in the land office in payment tor the public lands. When this resolution was put to a vote in the Senate, the old French lieuten¬ ant-governor, Col. Menard, presiding over that body, with more judgment than elegance, put the question and made the following comment: -

" Gentlemen of die Senate, it is moved and seconded dot de notes of * dis bank be made land office money. All in favor of dal motion, say aye; all against it say no. It is decided in de affirmative, and now gentlemen I bet you one hundred dollar he never be made land office money."

Col. Menard was in many respects a remarkable man. By his rare integrity and energy he accomplished much good for the people of the Territory and State, ana as a tribute to his memory and the services he had performed, the legislature subsequently formed and named the county of Menard, on the Sangamon river, in honor of him. The name of the new county could not have been more worthily bestowed.