Note DJ — LETTER XXVII.

Several bank charters in Louisiana contain a provision obliging the bank to lend a large proportion of the capital to the planters. The Citizen's Bank is bound to advance one half its capital to landholders, beside which they have the advantage of being share-holders without having paid up anything. The bank borrowed its effective capital of European capitalists; its nominal capital is double that sum. It gives in return mortgages on the estates of the share-holders to that amount, with the guarantee of the mortgage by the State. Each share-holder is entitled to credit to the amount of half his stock at the rate of six per cent. The other half of the capital is devoted to the commercial operations of the bank. The share-holders then, have their share in the profits. It will be seen that this system depends on the legislation in regard to mortgages.