The Madisonian

First National Bank of Madison ~ click to enlarge

National Bank Notes were United States currency banknotes issued by banks chartered by the United States Government. The notes were backed by United States bonds the bank deposited with the United States Treasury.

Background
Prior to the American Civil War, state banks issued their own banknotes. During the Civil War, in 1863, the National Banking Act established a system of National Banks which were empowered to issue National Bank Notes subject to federal oversight. The chartering of banks and administrative control over the issuance of National Bank Notes were the responsibility of the Office of the Comptroller of the Currency. In 1865 the Congress enacted a 10% tax on state bank note issuance making it unprofitable for state banks to issue notes, and thus restricting the circulation of privately issued banknotes to the National Banks.

The Program
From 1863 to 1935, National Bank Notes were issued by banks throughout the country and in U.S. territories. Banks with a federal charter would deposit bonds in the U.S. Treasury. The banks then could print banknotes worth up to 90% of the value of the bonds. The federal government would back the value of the notes – the issuance of which created a demand for the government bonds needed to back them.

The Notes
National banknotes were similar in overall appearance to most of the Federal Reserve Notes that circulated from 1929 through the 1990s, with one important exception: the “title” (name) of the issuing “national bank”, as well as the name of the town and state where the bank was located were printed on the notes. These notes also bore the signatures of that bank’s president and cashier.

End of the Program
National bank notes were retired as a currency type by the U.S. government in the 1930s during the great depression as currency in the U.S. was consolidated into Federal Reserve Notes, United States Notes, and Silver Certificates – and privately issued banknotes were eliminated. The passage of the Gold Reserve Act created an accounting gain for the Treasury, part of which was used to provide funds to retire all of the bonds against which

National Banks Notes could be issued.
Sometimes these notes are called “hometown” notes, with their popularity deriving from the wide range of towns and cities that issued them. In the paper money hobby, especially in the U.S., these notes are avidly studied and collected. Some examples of rare banks, towns, states and combinations thereof are quite valuable.

First National Bank of Madison ~ click to enlarge

J.M White By Charles A. Daugherty - 1970

So a friend handed me these four drawings of steamboats that he had discovered in a box in his garage, they had been in the box in his garage and not seen the light of day for over fifteen years he says. Looking over the Internet to find some information about the artist proved futile until, quite by chance I emailed the owner of www.w9fs.com after reading his ‘people’ page. The mention of Charles A. Daugherty was enough for me to fire off an email, on a hunch. Most of the hunch was based on the name mentioned and the general area of Kentucky these good folks rooted from, specifically Howell Valley, Three Springs and Louisville.

I was searching the net for an artist names Charles A. Daugherty who did steamboat paddle wheelers in the 1970′s. From reading your site I learned you have a half brother of that name, possibly from southern Indiana. The four drawings were acquired in Madison IN, and I’m trying to find any info on this artist named Charles A. Daugherty. So far the net has yielded nothing.

Any assistance would greatly be appreciated.

Thanks in advance,

Morning Star By Charles A. Daugherty - 1970

I was pleasantly surprised to say the  least when this email found my inbox just a day later! Certainly didn’t expect any answer let alone a positive ‘hit’. 

Hi Bob,
Yes that is the work of my half brother, he did several paddle wheel drawings for several of the banks in Louisville in the 60′s.
I will forward this also to his son (my nephew) Charles P. Daugherty and if he will contact you he can answer many of the questions you may have!

A few more days pass and then the artists son sends along this historical information about them. Amazing what one can find out!

Donora By Charles A. Daugherty - 1970

Now the scans of these pictured do them absolutely no justice at all. They are very ‘crisp’ and the India ink is very black, unlike the pictures here. On close inspection the artwork is on a very heavy paper board and the signature at least appear to be originals signed in lead pencil. The pictures themselves do not appear to be originals (however with a authentic signature and no numbering, makes me wonder) as I’m thinking they are ink art done with the scratchboard technique. They may not be scratchboard at all and maybe someone will drop by and shed some light on the actual process of these great works of art.

Indiana By Charles A. Daugherty - 1970

You can get a better view and feel for these works in the photo galley using full screen mode and slide show.