To the President and Directors
of the Massachusetts Bank1
May 30th. 1791.
With a view to the accommodation of those in your quarter, who may incline to become subscribers to the Bank of the United States, I have concluded on the following arrangement.
That for any sums which shall be deposited in the Bank of Massachusetts to the Credit of the United States, to an amount not exceeding in the whole sixty thousand Dollars, I will cause equal sums to be paid in the City of Philadelphia towards the subscriptions which such persons respectively, or their respective representatives shall make to the Bank of the United States.2
In order that this arrangement may be carried into execution it will be necessary that the sums paid in be duly passed to the Credit of the United States; and that the parties or their Agents produce certificates from the Cashier of the Bank specifying the sums paid in and that they have been passed to the Credit of the United States.
And it is to be clearly understood that the operation to be for the sole purpose of subscriptions to the Bank as no money will be paid here in lieu of that deposited but on account of such subscriptions.
I take it for granted that your Direction will chearfully cooperate in a measure, so exclusively dictated by a desire to accommod⟨ate⟩ and so convenient to all concerned.
I have not thought fit to make any public annunciation of this arrangement, but it is my wish that it be informally communicated as extensively as may be.
I have the honor to be Gentn. Your obedt Servant
The President and Directors
of the Bank of Massachusetts.
Copy, RG 36, Collector of Customs at Boston, Letters from the Treasury, 1772–1818, Vol. 6, National Archives.
2. The statute of incorporation of the Bank of the United States stipulated that a subscriber could deposit one-fourth of the purchase price of each share and then pay the balance over a period of eighteen months. Since the shares were four hundred dollars each, the down payment was one hundred dollars. The law, however, required that only one-fourth of the first payment be in specie and payable immediately; as a result the investor needed only twenty-five dollars in gold or silver for each share. The remaining seventy-five dollars might be in three or six percent Government stocks which were not payable until January, 1792. See “An Act to incorporate the subscribers to the Bank of the United States” (1 Stat. description begins The Public Statutes at Large of the United States of America (Boston, 1845). description ends 191–96 [February 25, 1791]) and “An Act supplementary to the act intituled ‘An Act to incorporate the subscribers to the Bank of the United States’” (1 Stat. description begins The Public Statutes at Large of the United States of America (Boston, 1845). description ends 196–97 [March 2, 1791]). By offering the Massachusetts Bank a credit of sixty thousand dollars H guaranteed to Massachusetts investors twenty-four hundred shares of bank stock.
H’s proposal was of major importance not only to the Boston investors but also to the New York subscribers, for he included the New Yorkers in his plan. By this procedure H ensured Boston and New York influence in the bank. Inasmuch as the law set Philadelphia as the place of subscription, purchasers in distant regions were at a disadvantage. Nonresidents had to travel to Philadelphia with their specie or employ agents to act for them.