With the first great increase in immigration business was necessarily enlarged, and banking facilities became a necessity. Dr. Charles W. Borup, a Danish gentleman, who was engaged in the fur trade at Lake Superior as an agent for the American Fur Company, and Mr. Charles H. Oakes, a native of Vermont, came to St. Paul, and established a bank in 1853. They were brothers-in-law, having married sisters. They did a private banking business, under the name of Borup & Oakes, which adapted itself to the needs of the community, including real estate, and almost any other kind of venture that offered. The house of Borup & Oakes was the first banking establishment in Minnesota, and weathered all the financial storms that swept over the territory in its early history.

They were followed by Truman M. Smith, but he went down in the panic of 1857-58. Then came Bidwell's Exchange Bank, followed by C. H. Parker and A. Vance Brown. Mackubin & Edgerton opened a bank in 1854, which was the ancestor of the present Second National Bank, and always legitimate. I think Erastus S. Edgerton may justly be said to have been the most successful banker of all that were early engaged in the business. An enumeration of the banks and bankers which succeeded each other in these early times would be more appropriate in a narrative of the localities where they operated than in a general history of the state. It is sufficient to say that nearly all, if not all, of them succumbed to the financial disasters in 1857-58, and there was no banking worthy of the name until the passage of the banking law of July 26, 1858. But this act was a mere makeshift to meet a financial emergency, and it was not based upon sound financial principles. It allowed the organization of banks and the issue of circulating bank notes upon securities that were capable of being fraudulently overvalued by misrepresentation, and, as a matter of course, advantage was taken of the laxity of the provisions of the law, and securities which had no intrinsic value in fact were made available as the foundation of bank issues, with the inevitable result of disaster.

Another method of furnishing the community with a circulating medium was resorted to by a law of July 23, 1858. The state auditor was authorized to issue his warrants for any indebtedness which the state owed to any person in small sums, and the warrants were made to resemble bank notes, and bore twelve per cent interest. The credit of the state was not sufficiently well established in the public confidence to make these warrants, which were known as "state scrip," worth much over sixty-five or seventy cents on the dollar. They were taken by the money changers at that valuation, and when the state made its first loan of $250,000, they were all redeemed in gold at par, with interest at twelve per cent.In this uncertain way, the financial interests of the territory were cared for until the breaking out of the Civil War, and the establishment of the national and state systems which still exist.

Another evidence of the growth of the state may be found in the fact that at the present time the state has within its limits banks in good standing as follows: State banks, 172 in number, with a paid-in capital stock of $6,736,800, and sixty-seven national banks, with a capital stock paid in of $11,220,000. This statement does not include either the surplus or the undivided profits of these banks, nor the capital employed by private banking concerns which do not fall under the supervision of the state, which latter item can safely be estimated at $2,000,000.

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