Atlantic National Bank (New York City)

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Atlantic National Bank was a bank located at 17 Nassau Street in lower Manhattan in New York. It was organized in 1853 as a state institution. It became a national bank after legislation authorizing such institutions was voted on by the United States Congress. [1] It was selected by the Erie Canal Board as a depository of its canal tolls in March 1856. [2] The bank became insolvent in April 1873.

Bank financial institution

A bank is a financial institution that accepts deposits from the public and creates credit. Lending activities can be performed either directly or indirectly through capital markets. Due to their importance in the financial stability of a country, banks are highly regulated in most countries. Most nations have institutionalized a system known as fractional reserve banking under which banks hold liquid assets equal to only a portion of their current liabilities. In addition to other regulations intended to ensure liquidity, banks are generally subject to minimum capital requirements based on an international set of capital standards, known as the Basel Accords.

Nassau Street (Manhattan) street in Manhattan

Nassau Street is a street in the Financial District of New York City. It is located near Pace University and City Hall. It starts at Wall Street and runs north to Spruce Street at the foot of the Brooklyn Bridge, located one block east of Broadway and east of Park Row, in the borough of Manhattan.

Lower Manhattan Central business district in New York, United States

Lower Manhattan, also known as Downtown Manhattan or Downtown New York, is the southernmost part of Manhattan, the central borough for business, culture, and government in the City of New York, which itself originated at the southern tip of Manhattan Island in 1624, at a point which now constitutes the present-day Financial District. The population of the Financial District alone has grown to an estimated 61,000 residents as of 2018, up from 43,000 as of 2014, which in turn was nearly double the 23,000 recorded at the 2000 Census.

Contents

Bank history

The Atlantic National Bank was one of three in New York City to be exempted from taxes which pertained to capital invested in United States stocks after February 25, 1862. On that date a clause in an act was passed specifying this exclusion. The amount which the Atlantic National Bank declined to pay was $5,203.20. [3]

United States federal republic in North America

The United States of America (USA), commonly known as the United States or America, is a country composed of 50 states, a federal district, five major self-governing territories, and various possessions. At 3.8 million square miles, the United States is the world's third or fourth largest country by total area and is slightly smaller than the entire continent of Europe's 3.9 million square miles. With a population of over 327 million people, the U.S. is the third most populous country. The capital is Washington, D.C., and the largest city by population is New York City. Forty-eight states and the capital's federal district are contiguous in North America between Canada and Mexico. The State of Alaska is in the northwest corner of North America, bordered by Canada to the east and across the Bering Strait from Russia to the west. The State of Hawaii is an archipelago in the mid-Pacific Ocean. The U.S. territories are scattered about the Pacific Ocean and the Caribbean Sea, stretching across nine official time zones. The extremely diverse geography, climate, and wildlife of the United States make it one of the world's 17 megadiverse countries.

In April 1864 an amendment was passed in the New York Legislature to amend the bank's charter. [4] In December 1865 the bank's directors declared a semi-annual 6% dividend which was exempt from government tax. The funds to be issued came from the profits of the previous six months. They were distributed after January 2, 1866. J. E. Southworth was the bank's president at the time. [5]

At the conclusion of March 1871 the Atlantic National Bank possessed capital of $350,000, with undivided profits amounting to $63,700. [6]

Insolvency details

At the time of its failure the Atlantic National Bank had fixed capital of $300,000. Following its opening on April 26, 1873, it incurred heavy losses after the depreciation of securities which it held as collateral for losses. These funds were not replenished. F. L. Taintor, the cashier, declared the bank insolvent and attested to its defaulting in the amount of $400,000. The money which was lost came primarily out of bank funds, but it was acknowledged that Pacific Mail was among the securities which came up short in the losses sustained. [1]

A subsequent investigation conducted by W. J. A. Fuller, Chairman of the Depositor's Committee, found that the Atlantic National Bank was in an insolvent state for at least a year prior to its failure. The United States Treasury was left to consider the mysterious circumstances of how the bank remained afloat for so many months. Of particular interest was how a cashier could drain $300,000 from the funds of depositors without the knowledge of the institution's president or its officers. [7]

Other banks

This bank should not be confused with the unrelated Atlantic National Bank of the City of New York (1914-1922), [8] Atlantic Bank of New York (1952-2006), Atlantic National Bank of Jacksonville, Florida (1903-1985), or other banks with similar names.

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References

  1. 1 2 A Broken Bank, The New York Times , April 27, 1873, p. 1.
  2. ↑ Canal Toll Deposit Banks, March 22, 1856, p. 3.
  3. ↑ A Raid On The Banks, The New York Times, January 21, 1864, p. 8.
  4. ↑ State Legislature, The New York Times, April 25, 1864, p. 4.
  5. ↑ Dividends, The New York Times, January 10, 1866, p. 6.
  6. ↑ Financial Affairs, The New York Times, March 30, 1871, p. 3.
  7. ↑ Banks In Trouble, The New York Times, April 30, 1873, p. 12.
  8. ↑ New York Bank History
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