The run on Page, Bacon & Co. therefore continued throughout the 21st, and I expected all day to get an invitation to close our bank for the next day, February 22, which we could have made a holiday by concerted action; but each banker waited for Page, Bacon & Co. to ask for it, and, no such circular coming, in the then state of feeling no other banker was willing to take the initiative. On the morning of February 22, 1855, everybody was startled by receiving a small slip of paper, delivered at all the houses, on which was printed a short notice that, for "want of coin," Page, Bacon & Co. found it necessary to close their bank for a short time. Of course, we all knew the consequences, and that every other bank in San Francisco would be tried. During the 22d we all kept open, and watched our depositors closely; but the day was generally observed by the people as a holiday, and the firemen paraded the streets of San Francisco in unusual strength. But, on writing up our books that night, we found that our deposit account had diminished about sixty-five thousand dollars. Still, there was no run on us, or any other of the banks, that day; yet, observing little knots of men on the street, discussing the state of the banks generally, and overhearing Haight's expression quoted, that, in case of the failure of Page, Bacon & Co., "all the other banks would break," I deemed it prudent to make ready. For some days we had refused all loans and renewals, and we tried, without, success, some of our call-loans; but, like Hotspur's spirits, they would not come.
Our financial condition on that day (February 22, 1855) was: Due depositors and demand certificates, five hundred and twenty thousand dollars; to meet which, we had in the vault: coin, three hundred and eighty thousand dollars; bullion, seventy-five thousand dollars; and bills receivable, about six hundred thousand dollars. Of these, at least one hundred thousand dollars were on demand, with stock collaterals. Therefore, for the extent of our business, we were stronger than the Bank of England, or any bank in New York City.
Before daylight next morning, our door-bell was rung, and I was called down-stairs by E. Casserly, Esq. (an eminent lawyer of the day, since United States Senator), who informed me he had just come up from the office of Adams & Co., to tell me that their affairs were in such condition that they would not open that morning at all; and that this, added to the suspension of Page, Bacon & Co., announced the day before, would surely cause a general run on all the banks. I informed him that I expected as much, and was prepared for it.
In going down to the bank that morning, I found Montgomery Street full; but, punctually to the minute, the bank opened, and in rushed the crowd. As usual, the most noisy and clamorous were men and women who held small certificates; still, others with larger accounts were in the crowd, pushing forward for their balances. All were promptly met and paid. Several gentlemen of my personal acquaintance merely asked my word of honor that their money was safe, and went away; others, who had large balances, and no immediate use for coin, gladly accepted gold-bars, whereby we paid out the seventy-five thousand dollars of bullion, relieving the coin to that amount.
Meantime, rumors from the street came pouring in that Wright & Co. had failed; then Wells, Fargo & Co.; then Palmer, Cook & Co., and indeed all, or nearly all, the banks of the city; and I was told that parties on the street were betting high, first, that we would close our doors at eleven o'clock; then twelve, and so on; but we did not, till the usual hour that night. We had paid every demand, and still had a respectable amount left.
This run on the bank (the only one I ever experienced) presented all the features, serious and comical, usual to such occasions. At our counter happened that identical case, narrated of others, of the Frenchman, who was nearly squeezed to death in getting to the counter, and, when he received his money, did not know what to do with it. "If you got the money, I no want him; but if you no got him, I want it like the devil!"
Toward the close of the day, some of our customers deposited, rather ostentatiously, small amounts, not aggregating more than eight or ten thousand dollars. Book-keepers and tellers were kept at work to write up the books; and these showed:
Due depositors and certificates, about one hundred and twenty thousand dollars, for which remained of coin about fifty thousand dollars. I resolved not to sleep until I had collected from those owing the bank a part of their debts; for I was angry with them that they had stood back and allowed the panic to fall on the banks alone. Among these were Captain Folsom, who owed us twenty-five thousand dollars, secured by a mortgage on the American Theatre and Tehama Hotel; James Smiley, contractor for building the Custom-House, who owed us two notes of twenty thousand and sixteen thousand dollars, for which we held, as collateral, two acceptances of the collector of the port, Major R. P. Hammond, for twenty thousand dollars each; besides other private parties that I need not name. The acceptances given to Smiley were for work done on the Custom-House, but could not be paid until the work was actually laid in the walls, and certified by Major Tower, United States Engineers; but Smiley had an immense amount of granite, brick, iron, etc., on the ground, in advance of construction, and these acceptances were given him expressly that he might raise money thereon for the payment of such materials.
Therefore, as soon as I got my dinner, I took my saddle-horse, and rode to Captain Folsom's house, where I found him in great pain and distress, mental and physical. He was sitting in a chair, and bathing his head with a sponge. I explained to him the object of my visit, and he said he had expected it, and had already sent his agent, Van Winkle, down-town, with instructions to raise what money he could at any cost; but he did not succeed in raising a cent. So great was the shock to public confidence, that men slept on their money, and would not loan it for ten per cent. a week, on any security whatever—even on mint certificates, which were as good as gold, and only required about ten days to be paid in coin by the United States Mint. I then rode up to Hammond's house, on Rincon Hill, and found him there. I explained to him exactly Smiley's affairs, and only asked him to pay one of his acceptances. He inquired, "Why not both?" I answered that was so much the better; it would put me under still greater obligations. He then agreed to meet me at our bank at 10 P.M. I sent word to others that I demanded them to pay what they could on their paper, and then returned to the bank, to meet Hammond. In due time, he came down with Palmer (of Palmer, Cook & Co.), and there he met Smiley, who was, of course, very anxious to retire his notes. We there discussed the matter fully, when Hammond said, "Sherman, give me up my two acceptances, and I will substitute therefor my check of forty thousand dollars," with "the distinct understanding that, if the money is not needed by you, it shall be returned to me, and the transaction then to remain statu quo." To this there was a general assent. Nisbet handed him his two acceptances, and he handed me his check, signed as collector of the port, on Major J. R. Snyder, United States Treasurer, for forty thousand dollars. I afterward rode out, that night, to Major Snyder's house on North Beach, saw him, and he agreed to meet me at 8 a.m. next day, at the United States Mint, and to pay the check, so that I could have the money before the bank opened. The next morning, as agreed on, we met, and he paid me the check in two sealed bags of gold-coin, each marked twenty thousand dollars, which I had carried to the bank, but never opened them, or even broke the seals.
That morning our bank opened as usual, but there was no appearance of a continuation of the "run;" on the contrary, money began to come back on deposit, so that by night we had a considerable increase, and this went on from day to day, till nearly the old condition of things returned. After about three days, finding I had no use for the money obtained on Hammond's check, I took the identical two bags back to the cashier of the Custom-House, and recovered the two acceptances which had been surrendered as described; and Smiley's two notes were afterward paid in their due course, out of the cash received on those identical acceptances. But, years afterward, on