The problems Woodruff was encountering would become known as the Panic of 1837, a recession that took many years to recover from. Arkansas would only receive $45,583.83 of federal money, the amount of the first check which was ultimately settled by the Natchez banks. While Woodruff was trying to acquire the Distribution Act funds, the Arkansas State Banks had opened in Arkansas Post, Batesville, Fayetteville, Little Rock, and Washington and had been loaning money based on the notes given to Woodruff from various other states. Further, the bonds issued by the banks were not selling as anticipated, leaving the institutions without much of their anticipated seed money. Both banks would fail within a decade, with the bonds they had issued becoming entangled in legally questionable deals. Eventually the bonds fell into the hands of London banker James Holford, and they would come to be known as the "Holford Bonds", valued at $1,239,526.82 ($ million today) in 1858. The issue of whether or not the bonds were a legitimate state debt and whether or not they would be repaid would be a political issue in the state throughout the 1800s.