This section is from the "Practical Banking" book, by Albert S. Bolles.
The Boston Clearing-house, like that of New York, has had but two managers, Mr. Henry B. Grove, from the organization of the Clearing-house in 1855 to his death in April, 1877, and Mr. Nathaniel G. Snelling, the present incumbent, from that date until the present time. Mr. Snelling was assistant manager from 1861 to 1877, and has therefore been connected officially with the Clearing-house for twenty-three years. The clerks and porters, as well as the manager, give bonds. The daily routine is substantially the same at Boston as at New York. The hour for clearing is ten o'clock, A. M. The debtor banks are required to pay their balances by 12.15 P M., and the creditor banks receive them at 1½ o'clock P. M. Thirty minutes are allowed for the proof and for delivering check tickets, and for each fifteen minutes' detention beyond that time two dollars are added to the fine incurred. About half an hour is required to prepare the exchanges for the Clearing-house. The messengers complete the delivery of the packages at the Clearing-house in about five minutes. They receive the return clearings in about ten or fifteen minutes, and are generally back at their respective banks by fifteen or twenty minutes past ten. The paying teller completes the examination of the return exchange usually by eleven o'clock, and then delivers the checks and vouchers to the bookkeeper, who enters them on his books in ink of a different color from that used in charging those paid over the counter. Usually the bank sending paper to the Clearing-house marks its number on the back of each check or voucher in blue ink, but the practice is not uniform. Although the check tickets are usually prepared at the bank and delivered by the messengers, this is not obligatory. It is sufficient if the check tickets are all delivered before half-past ten o'clock, for failure to do which a fine of one dollar is imposed. No failure has ever occurred among the banks connected with the Boston Clearing-house, though the Mechanics' Bank (No. 30) never came in, and the Metropolis (No. 38), discontinued business many years ago. Provision is made in the Constitution for making one of the associated banks a depository of coin against which certificates may be issued. But this provision is at present dormant, United States gold certificates beings used instead. In case of default by any bank in paying its balances at the Clearing-house, the Constitution, in addition to provisions similar to those of the New York Clearing-house, provides that any bank responding to the manager's requisition for the deficiency may have its exchanges with the defaulting bank canceled, and be restored to the position in which it stood before the exchange was made. Weekly statements are required from the banks, as in New York.
At Philadelphia there are two clearings daily. The first, and principal clearing is at half-past eight o'clock, A. M. The balances of this clearing are paid in legal tender notes or United States certificates, between the hours of eleven and twelve o'clock. A second, or "runners'" exchange, is held at half-past eleven, for the settlement of the items formerly taken to the different banks by the runners, namely, the notes and checks received by the morning mail. The balances of this exchange are paid by due bill, which goes through the next morning's exchanges. The clearing methods are similar to those at New York. Weekly bank statements are also published.
At Chicago the hour for clearing is eleven o'clock daily. Balances must be paid by the debtor banks between the hours of twelve and half-past twelve, and the creditor banks receive them between half-past twelve and a quarter of one o'clock. Balances are, by the rules of the Clearing-house, payable in gold coin, legal
tenders, National bank notes, United States and Clearing-house certificates. It is customary, however, for the banks to save the handling of actual cash to a greater or less extent by the following expedient:A debtor bank sells to some creditor bank New York or Boston exchange, and receives from the latter a check or order on the Clearing-house, the form of which is printed on green paper, and is as follows:
or order Dollars,
The debtor bank delivers this voucher at the Clearing-house in settlement of the amount which it represents, and it is available to the Clearing-house in settling with the creditor bank without handling any cash. At St. Paul a similar usage prevails, the check or order on the Clearing-house being printed on light yellow paper.
W. S. Smith, Manager,
Chicago Clearing-house. Pay......................................
and deduct from balance due us this day. $........