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Volume 2 - ElectricCanadian.com

Volume 2 - ElectricCanadian.com

Volume 2 - ElectricCanadian.com

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THE CHARTER 27Confederation, Mr. Rowland took the post of Minister ofInland Revenue, Mr. Gait again be<strong>com</strong>ing Minister of Finance.In October, 1867, just five months after The CanadianBank of Commerce had begun business, came the final scenein the tragedyof the Commercial Bank. At the annualmeeting in June, 1867, it was proposed to write off part of itscapital. New directors took charge, and auditors wereappointed to investigate and report on the bank's position,but their report failed to reassure the public. The depositorsbecame uneasy and the unrest culminated in a run. Assistancewas secured from the Bank of Montreal, but a few weeks laterthe run started again. The Hon. Alexander T. Gait, Ministerof Finance, was at this period one of the bank's directors, soapplication was made to the Dominion Government to <strong>com</strong>eto the bank's assistance. This was refused, and a subsequentapplication to the other banks in Montreal meeting a likefate, the Commercial Bank suspended payment on October22. Great excitement prevailed in Toronto over the event,much more than in the case of the Bank of Upper Canada,and runs took place on several of the banks, which were onlyallayed when the Dominion Government announced itswillingness to accept the notes of all the banks stilldoingbusiness. The rumours regarding the Commercial Bank andthe unsettlement of the public mind that they produced wereamong the difficulties with which The Canadian Bank ofCommerce had to contend at the outset, giving the managementmany moments of deep anxiety and causing it to putforth every effort to maintain strong cash reserves, lest thedistrust should spread to the infant institution under its charge.The failure of the Commercial Bank was an honourableone. Its affairs were found in much better shape than thoseof the Bank of Upper Canada, and it was recognized that ifgiven time the liabilities could be paid in full.Finally, earlyin 1868, arrangements were concluded with the MerchantsBank of Canada to take over its assets and issue to its shareholdersshares in the Merchants Bank in exchange for shares

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