Pioneer Banks Were Primitive

In the days of 1865, farmers were the "Lords of Creation"

The Janesville Gazette, April 7, 1909

Josiah Wright Gives Interesting Reminiscences of Early "Boom" Days of Janesville
 
Janesville in 1854 had three banks - the Badger State, usually called
"DIMOCK's bank"; the Central, "DOE's bank"; the Janesville City, or "BUNSTER's bank." While these several institutions were styled banks, they were what at that time in the east would be classed as brokers. Whether any except the City had a circulation I do not remember, but I think not. The bills were a neat ornamental piece of art - steel engraving, and looked as well as any currency. The banking law required a deposit of state bonds with the bank commissioner, on which the auditor would place his signature for ninety per cent of the value of the securities, making them a safe circulating medium.
The bank was not formally organized until Feb. 12, 1855 (although it had been
doing business before), with three stockholders, as follows, viz., Theodore PERRY, New York City, 83 shares, $8300; Wm. SANDERSON, Milwaukee, Wis., 84 shares, $8400; John W. HOBSON, Janesville, 83 shares, $8300.
With the above securities the circulation was obtained and the bank was known.
All that was absolutely needed was an office with the necessaries - a safe, set of books, and pen and ink. When the writer came, in 1854, Mr. Henry BUNSTER was the man at the helm. The office was a one-story little affair on the south end of the vacant lot owned by Mr. Thomas LAPPIN, who, when he built, commenced on the corner of the alley on Milwaukee street and built and finished an office, making it possible for the bank to move directly into, before the old office was removed.
Mr. BUNSTER was an Englishman, I think, although his blarney would sometimes
make him appear to be a true son of the "Emerald Isle." The greater proportion of the farmers were Scotch and English. A Scandinavian was not known upon the streets. When they did appear, they were appreciated for their sterling worth, as they have ever since been.
Personality has much to do in making friendships. Mr. BUNSTER had in a
marked degree these social qualities and the farmers who were the "lords of creation" seemed to like him and largely gave him their business.
For some unaccountable reason Mr. BUNSTER offered the writer the office of
cashier, which was declined. I preferred the freedom of a wholesale business which necessitated my going about the country soliciting trade and making acquaintances. The travel was with a horse or horses. The country was new. The rides were not only exhilirating, but enchanting. After repeated approaches I recommended a young man living in Utica, N.Y., Mr. Samuel LIGHTBODY, who had means. He came out and accepted the position. Within a short time Mr. LIGHTBODY and the writer bought out Mr. BUNSTER and became sole owners of the bank. Alternately we would serve as tellers. The bookkeeper was without exception the most accomplished for the position it has been my privilege to know. His name was James FRAZER, son of Mr. Robert FRAZER of Milton, a true blue Scotchman. In the first place, during business hours he was silent. He was also correct in figures, a rapid writer, and withal a hand so plain that any child could read it. Very different from the present service, for at least half the departments from outside banks, when listing, one might as well try to interpret a name from an Egyptian obelisk, embellished with winged bulls.
Bankers nowadays would shrink from the work of those times. On the pass-book,
as well as the slip, deposits had to be classified - eastern exchange, gold and currency, gold a premium, exchange a discount, currency at par.
It was not long before reports would be received rating certain cities at a discount.
We were on the eve of the wildest, most frenzied conditions of wildcat circulation ever known. When the work of the day was over and the safe locked we supposed the money was all good. The morning's inspection would find more or less, as reported from Chicago by wire, as worthless up to a small discount. With all these discouragements the bank was making money. Eastern exchange was from 1 to 2 percent discount. No one from there brought currency. Often we were obliged to send to New York for it - sent by express. The rate of interest was 10 per cent, but by agreement 12 per cent. Speculators in city lots and farm lands were busy. Often a sale made on which they would make $1,000. In order to get money to go on with their investments they would offer one-half of their profits for money. The value of property rose in a short time from one to five hundred per cent. Everything was simply on a boom.
Mr. A. K. NORRIS built a large steam sawmill just above the railway
embankment, where now are the City Ice Co. houses. He bought his pine logs from Wolf river lumberman and had them put on cars and brought to Chester, where they were dumped into Rock river and rafted, coming through Lakes Horicon and Koshkonong to Janesville. It was a strange sight to see great rafts of logs held by booms in our harbor. Fortunately the fleet was small. Had there been any such number as at present sailing would have been difficult.
Mr. NORRIS did a thriving business. It was a fine thing for those who were
building. In my case I needed extra long timber when building, so I went and selected the logs, which were sawed as desired. Mr. NORRIS came from Bangor, Maine. He was a relative of S. H. RAWSON, Esq., president of the City Bank of Bangor. His was one of the old safety funds and he wanted circulation. Many will recollect seeing those bills. We borrowed sixty thousand per month and scattered them about. The bills were all ones and twos. In fact, they were the principal currency on the street.
We loaned the directors of the C. & N. W. Ry. for grading from Turner Junction
to Belvidere. When completed, Mr. George SMITH, a Scotch banker of Chicago, expected a loan on their bonds, after which we could loan them no more money. Mr. NORRIS' requirements were large and the enterprise a success. After serving the bank a little over a year I became restive, as my leather business was suffering, and sold out my interest to Mr. LIGHTBODY. The deposits at the time were: on certificate - Sixty-eight thousand dollars; deposit ledger, seventy-eight thousand dollars. We considered the bank in fine condition, considering the fact there was no surplus money. It was all needed with which to buy or build. Mr. LIGHTBODY could find no one that suited as a partner. There were parties who wanted to buy and finally he sold to the following gentlemen: the late Hon. Hamilton RICHARDSON and John P. HOYT, who in turn sold to the late Timothy JACKMAN.
The Badger State was finally wound up; the Central reorganized and is now the
First National. The Producers was never opened for business. Alexander GREY and A. Hyatt SMITH were the organizers. It was intimated on the street they intended it to be the clearing house for the state of Wisconsin and possibly regions beyond of the ancient secret order (with its auxiliaries) of the memorable One Thousand and One.
We cannot be too thankful for our stable currency, for which we are largely
indebted to the late President Cleveland, who took a decided stand that our circulating medium should be based upon gold, instead of baser metals. Tariff and currency are two extremely sensitive questions.
Mr. BUNSTER was a good-hearted man; Mr. DIMOCK, too good-hearted or
accommodating, for a banker. Mr. DOE was a fine businessman and a pattern for young men.
The banks of our city are an honor to it. By the way of advice, I would urge the
young people to open accounts in the savings departments. I know of a good many that have. Don't spend all your money for theatre attractions or useless expenditures, but be saving, for some day the money will do you good.

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