Introduction:

Loughnan’s Bank was first registered on 23rd September 1800, by Connel Loughnan and John Helsham, who became Lord Mayor of Kilkenny in 1804. It opened shortly after the Williams & Finn Bank established itself in Kilkenny City. John Helsham was the fourth member of his family to become Lord Mayor of Kikenny, following

• 1679 Arthur Helsham (who died during his tenure)
• 1692 and 1693 Joshua Helsham
• 1725 and 1739 Arthur Helsham

According to Stamp Duty returns records of 1803, Loughnan’s Bank had 1,000 notes under Three Guineas and 1,000 notes under Ten Pounds.

Type 1: Kilkenny Bank (Connel Loughnan and John Helsham)

Banknote denominations included:

• ?

Type 2: Kilkenny Bank (Michael Brennan and James Loughnan)

In 1813, they were replaced by Michael Brennan and James Loughnan. When Brennan retired in 1816, Loughnan remained as sole director until it closed in 1820.

Banknote denominations included:

• ?

Type 3: Kilkenny Bank (James Loughnan)

A small private bank with only one director might seem a bit risky, given the track record of small banks towards the close of the 18th C but James Loughnan pressed on and seemed to do well in the short term.

Banknote denominations included:

• Five Pounds Sterling
• Four Pounds
• Two Pounds
• One Pound & Ten Shillings
• One Guinea
• One Pound

The Napoleonic Wars ended in 1815 and there was a brief period of economic boom. The first shock came to the linen industry in England later on in 1815 but that did not adversely affect Kilkenny.

The Corn Laws of 1815 did affect Ireland – as the English Parliament imposed a tariff on foreign grain in an effort to protect English grain producers (agricultural landowners). This resulted in an agricultural depression in Ireland and Scotland that did not end until 1822. A depression in the wool industry in 1820 worsened problems for Irish agriculture.

In common with many small private banks at that time, Loughnan’s bank found itself in financial difficulties and, despite support from the Earl of Dysart, the bank failed in 1820 when a group of creditors petitioned to ‘wind up’ the bank.

The solution to Loughnan’s difficulties seemed quite amicable insofar as the Committee appointed to administer the financial affairs of James Loughnan stated:

“…by economical and judicious management his effects may may ultimately be equal to meet his engagements.”

The Earl of Dysart certainly helped the creditors situation by announcing that he would continue to accept Loughnan’s paper notes as rent. When the bank’s statement was made public, it was found that Loughnan’s total liabilities totaled £63,600, of which £25,800 were on notes outstanding. Against this lay assets to the value of £

• Bank assets @ £24,000
• Loughnan’s property @ £28,200
  • A shortfall of £11,400
  • The Committee estimated a payout of 10s to the Pound

 

Loughnan’s Bankruptcy:

The aftermath, however, proved to be less amicable than originally perceived. The creditors were anxious to avoid the delays (and the inevitable high costs) of formal bankruptcy proceedings and they voted to ‘wind up’ the bank. They were, however, too late, as one creditor had already applied to the Courts for a bankruptcy and, despite their pleas, the Lord Chancellor refused to supercede it.

• Formal proceedings lasted until 1822 and, after costs were taken into account, creditors were awarded 7s & 6d in the pound.
• By 1834, some creditors had still not been paid
• Proceedings ‘dragged on’ until 1842

Small wonder the creditors wanted to avoid ‘the Courts’ back in 1820!

 

Bibliography:

Barrow, Lennox, Old Kilkenny Review, No. 24, pp. 36-40 (1971): Kilkenny private banks: Loughnan’s + Williams and Finn

Mansfield, Brocard M., Old Kilkenny Review, N.S. Vol 2 No 4, pp. 319-327 (1982): The Helshams of Kilkenny

Tenison, C.M., Old Kilkenny Review, No. 7, p. 54 (1954): Loughnan’s Bank, Kilkenny 1800-20 – Connell Loughnan & John Helsham

Young, Derek, Irish Numismatics, No. 56, pp. 47-48 (1977): The Private Banks & Their Notes – Loughnan’s Bank 1800-1820