Gramercy Bank (Lafayette, IN)

Episode Information

Episode UID
4816125290685
Episode Type
Suspension → Closure
Bank Type
private
Bank ID
481612529 hash
Start Date
January 15, 1857
Location
Lafayette, Indiana (40.417, -86.875)

Metadata

Model
gpt-5-mini (chosen from majority vote of a three-model LLM ensemble)
Short Digest
29cb9f467245464e

Response Measures

None

Description

Contemporary reports call the Gramercy a failed/free bank caused by speculation and apparent fraud; no explicit receiver named in these articles.

Events (1)
1. January 15, 1857 Suspension
Cause
Bank Specific Adverse Info
Cause Details
Failure attributed to speculative operations in state stocks, Wall Street speculations, and apparent fraud by owners (securities removed).
Newspaper Excerpt
A dispatch was received ... that the Shawnee Bank of Attica, and the Gramercy Bank of Lafayette, had failed.
Source
newspapers

Newspaper Articles (4)
1. January 17, 1857 The Evansville Daily Journal Evansville, IN
Article from The Evansville Daily Journal, January 17, 1857

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Article Text

Bank Failures. A dispatch was received in this city yesterday, that the Shawnee Bank of Attica, and the Gramercy Bank of Lafayette, had failed. These banks have always been among the best of the free banks and both have been tak on on deposit by the Crescent City and Canal banks. These failures will prove a considerable loss to many of our citizens, some of whom have several hundred dollars of the paper on hand. The Gramercy Bank failure is a bad one, and the failure of the Shawnee Bank at Attica followed from the fact that it was owned by the Gramercy Bank. The sante contern was also interested in the Branch of the new State Bank at Bedford. The State Board has promptly taken possession of this branch, so that no misapplication can be made of its funds. The Gramercy managers made it a business to start stock banks in this State and Illinois, upon the borrowing system. As long as their credit could be sustained, everything went on swimmingly, but when the cost of circulation exceeded the interest, the result was suspension.

2. January 22, 1857 Marshall County Republican Plymouth, IN
Article from Marshall County Republican, January 22, 1857

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Article Text

Gramercy Bank Failed. The Indiana Journal, of the 15th inst has the following in reference to the fail ure of the Gramercy Bank. under its monetary and commercial head: The bills of the Gramercy Bank, at La fnyette. were thrown out yesterday by the Bankers of this city. The securities of the Bank are gone, and its notes, consequently, worthless. We understand that under misapprehension of the intention of the parties, and by seemingly fair rep. resentations made, the Auditor of State permitted the securities to be removed from his office. As matters stand at pre sent, the circulating notes of the Gram erey Bank are worth little or nothing. The Journal of the 16th, contains the following additional information in regard to the failure of the Gramercy and other Banks: The failure of the Gramercy Bank is attributable to speculations in State Stocks, in Wall street operations, and not to the failure of any Bank to pay claims held by the Gramercy Bank The owners of the Gramercy were, al. 80. the owners of the Shiwnea Bink at Attica, That Bank is now placed in the list of suspended and Broken Banks. The Gramercy owned four Illinois Banks, one of which [the Prairie State Bank, at Washington.] we noticed yes terday as having failed, Illinois money is generally discredited, not on account of the connection of the Genmercy with several of the banks of that State partic. ularly, but because a feeling of distrust has been prevalant for some time in ref. erence to their solvency. Some of our merchants receive Illinois money, but all the Banks throw it out or discount it heavily Both houses of the Legislature to-day passed resolutions asking the Auditer and Treasurer of State to lay before them the amount of circulation, bonds on deposite as securities, and the value of the same, belonging 10 the Gramercy Bank Another resolution calls for information of a similar character in reference to all the Free Banks of the State,When all the statements are made. it will then be seen who has been at fault, if fault there is, in the matter of the remo. val of securities, to which we alluded yesterday. The Free Banks of Indiana, in compliance with the law, have been publishing their semi-annual statements in the Journal for some days past. The stant. ing of the Banks can be learned from these statements They are all sound and safe. The failure of the Gramercy and Shawnea Banka should not affect the credit of any other of the Free Banks, or diminish the confidence that the people have in their stability. 11 the securities of the Gramercy were removed from the Auditor's office under false pretenses, that fact should not implicate the officers, or injure the credit of any other Bank.

3. January 23, 1857 Indiana American Brookville, Indianapolis, IN
Article from Indiana American, January 23, 1857

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Article Text

Another Bank Panic! The failure of the Gramercy Bank, Lafayette, and the Shawnee Bank, Attica, under circumstances that reveal fraud, on the part of their owners, if not also corruption on the part of the Auditor of State, has caused another panic in regard to the Free Banks of Indiana and Illinois. No wonder. If these, which sustained the shock of two years ago, go down, what confidence can the public put in any of them? Alluding to the panic in Cincinnati, the Gazette of Monday says: "The notes of the following Indiana Banks were thrown out on Saturday :Central and Farmers' & Mechanics' Bank of Indianapolis; Tippecanoe Bank at Logansport; and Brookville Bank at Brookville. The latter Bank, however, was by some considered good, and some of the houses continued to receive the paper at par. It is owned and managed, we are informed, by good and responsible men.Of the Illinois Banks, the notes of the following were thrown:-State Stock Security Bank at Danville; People's Bank at Carmi; Prairie State Bank at Washington; Rushville Bank at Rushville; Agricultural Bank at Marion; Central Bank at Peoria. The Bank of the Capitol at Indianapolis, the Exchange Bank at Greencastle, Ind., and the Farmers's & Traders' Bank at Charleston, III., are received with distrust. What this excitement will lead to, it is difficult to say." We wish it would lead to an abandonment of the new-fangled patent-Democracy system of banking without capital. If the present Legislature does not do something to protect the people from the flood of spotted paper, called money, we wish they would go into "joint convention" in the penitentiary for two years, and let the people elect Legislators who would do some good.

4. February 5, 1857 Belmont Chronicle Saint Clairsville, OH
Article from Belmont Chronicle, February 5, 1857

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Article Text

THE BANKS-Itwas our intention to have given the circulation and securities of the Illinois and Indiana Banks that are discredited, but the storm has prevented our doing 80 this week. The troubles in I Ilinois and Indiana have been precipitated by the Gramercy Bank, which concern, or its backers, owned several other banks, which, of course, all went over like a row of bricks. The Gramercy Bank owners, we see are at the head of one of the branches of the Bank of the State of Indiana." The discredited banks, as far as we are posted, are: Gramercy Bank, Lafayette, Ind.; Shawnee Bank, Attica, Ind.; People's Bank. Carmi, Ill.; Stock Security Bank, Danville, III.; Prairie State Bank, Washingtor, III.; Rushville Bank, Rushville, III. The Exchange Bank, Bangor, Me.. has gone into the hands of Receivers-Tomb of the Capulets."-Thomps Bank Note Reporter.