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No. III.-Account of the Circulation, Deposits, Securities, Bullion, and Surplus (exclusive of Capital) of the Assets over the Liabilities of the Bank of England on the 31st August (or as near thereto as the Accounts can be made up) in each of the following Years.

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1821 1822 1823 1824 1825

1826 1827

1828

1829

1830

£ £ £ 1793 10,865,000 6,443,000 14,810,000 5,322,000 2,824,000 1794 10,287,000 5,936,000 12,446,000 6,770,000 2,994,000 1795 10,862,000 8,155,000 16,990,000 5,136,000 3,109,000 1796 9,247,0 6,656,000 17,025,000 2,123,000 3,245,000 1797 11,114,000 7,765,000 18,261,000 4,090,000 3,471,000 1798 12,181,000 8,301,000 17,350,000 6,546,000 3,414,000 1799 13,389,000 7,642,000 16,930,000 7,001,000 2,899,000 1800 15,047,000 8,355,000 22,138,000 3,150,000 3,907,000 1801 14,556,000 8,134,000 22,210,000 4,335,000 3,855,000 1802 17,098,000 9,739,000 27,113,000 3,892,000 4,169,000 1803 15,983,000 9,817,000 26,919,000 3,593,000 4,711,000 1831 1804 17,154,000 9,716,000 25,827,000 5,879,000 4,836,000 1832 1505 16,388,000 14,018,000 27,773,000 7,625,000 4,961,000 1833 1806 21,027,000 9,636,000 29,473,000 6,215,000 5,024,000 1834 1807 19,678,000 11,789,000 29,937,000 6,484,000 4,954,000 1835 1808 17,111,000 13,013,000 29,244,000 6,016,000 5,136,000 1836 1809 19,574,000 12,257,000 33,435,000 3,652,000 3,256,000 1837 1810 24,794,000 13,618,000 40,974,000 3,192,000 5,751,000 1838 1811 23,287,000 11,076,000 37,083,000 3,243,000 5,961,000 1839 1812 23,027,000 11,849,000 38,176,000 3,099,000 6,400,000 1840 1813 24,828,000 11,160,000 | 40,106,000 2,712,000 6,831,000 1841 1814 28,368,000 14,850,000 48,346,000 2,098,000 7,225,000 1842 1815 27,249,000 12,696,000 44,854,000 3,409,000 8,319,000 1843 1816 26,759,000 11,856,000 37,280,000 7,563,000 6,227,000 1817 29,541,000 9,0x5,000 32,606,000 11,668,000 5,646,000 1818 26,202,000 7,928,000 32,371,000 6,363,000 4,601,000 1819 25,253,000 6,304,000 31,741,000 3,595,000 3,779,000 1520 24,299,000 4,421,000 23,846,000 8,211,000 | 3,337,000

1844

1845 1846 1817

£

£ 20,295,000 5,818,000 18,476,000 11,234,000 3,595,000 17,165,000 6,399,000 17,291,000 10,098,000 3,524,000 19,231,000 7,827,000 17,467,000 12,658,000 3,067,000 20,132,000 9,680,000 20,905,000 11,787,000 2,880,000 19,399,000 6,410,000 25,106,000 3,634,000 2,931,000 21,564,000 7,200,000 25,081,000 6,754,000 2,074,000 22,748,000 8,052,000 23,199,000 10,164,000 2,863,000 21,358,000 10,201,000 23,906,000 10,499,000 2,846,000 19,547,000 9,035.000 24,662,000 6,796,000 2,875,000 21,465,000 11,621,000 24,566,000 11,150,000 2,631,000 18,339,000 9,069,000 23,905,000 6,440,000 2,737,000 18,320,000 10,278,000 23,420,000 7,514,000 2,336,000 19,925,000 11,927,000 23,245,000 10,871,000 2,264,000 19,195,000 13,300,000 27,732,000 7,303,000 2,540,000 18,085,000 13,725,000 28,173,000 6,255,000 2,618,000 18,018,000 12,040,000 27,697,000 5,250,000 2,889,000 18,887,000 10,040,000 25,357,000 6,548,000 2,978,000 19,488,000 8,922,000 21,611,000 9,540,000 2,741,000 17,982,000 6,488,000 25,141,000 2,420,000 3,091,000 17,170,000 6,254,000 22,075,000 4,299,000 2,950,000 17,370,000 6,975,000 22,602,000 4,822,000 3,079,000 20,332,000 8,690,000 22,159,000 9,729,000 2,866,000 19,340,000 11,307,000 21,632,000 12,295,000 3,280,000 21,485,000 12,138,000 21,872,000 15,315,000 3,564,000 22,109,000 14,402,000 24,507,000 15,592,000 3,589,000 21,390,000 16,322,000 25,164,000 16,388,000 3,840,000 18,828,000 14,417,000 28,007,000 9,164,000 3,926,000

No. IV.-Account of the Average Aggregate Amount of Promissory Notes Payable to Bearer on Demand, in circulation in England and Wales, Scotland and Ireland, at the undermentioned Periods.

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No. IV.-Account of the Average Aggregate Amount of Promissory Notes &c.-continued.

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No. V.-Quarterly Averages of the Weekly Liabilities and Assets of the Bank of England.

4,978,300 4,356,160
3,159,124 4,822,211
4,7 0,901 4,401,142

9,569,100

2,457,900
2,247,375

3.583,904
3,241,873
2.895,670 38,673.0.8
3,702,901, 41,166,120)

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20,603,000 3,105,000
21,427.000 3,220,000

21,166,002,971,060

20,330,000 3,058,000

2,862,000
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2,774,000
2,754,000

20.407,000 2,954,000 2,738,000
21,719,000 5,000,000); 2,872,000
22,157,000 2,838,000 2,774,00)
21,294,000 2,977,000 2,789,000

5,968,000 3,906,000 2,130,000 3,132,000
6,217,004,552,007 | 2,558,000 | 3,202,000
3,745,000 4,174,000 2,377,000 2,90 4,000
5,812,000
2,491,000 | 5,381,000

4,526,00

5,693,000 4,069,000
5,873,000 4,096,000
5,633,0 4,703,000
5,766,000, 4,903,000

21.185,000 2,843,400 2,508.663 i 5,352.063 4,294,549
24,697,000 2,906,966 2,529,032 5,430,908
24,573,000 | 2,505,925 2,179,138 | 4685,153
23,404,000 2,766,878 2,334,127 5,101,005

36,130,000 37,98, xd

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SEC. VII.-BANKS (SCOTCH). The Act of 1708, preventing more than six individuals from entering into a partnership for carrying on the business of banking, did not extend to Scotland. In consequence of this exemption, several banking companies, with numerous bodies of partners, have existed, for a lengthened period, in that part of the empire.

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was passed in 1804, to 1,500,000Z., its present amount. Of this sum, 1,000,000l. has been paid up. The last-mentioned Act directed that all sums relating to the affairs of the bank should henceforth be rated in sterling money; that the former mode of dividing bank stock by shares should be discontinued; and that, for the future, it should be transferable in sums or parcels of any amount. On the union of the two kingdoms in 1707, the Bank of Scotland undertook the recoinage, and effected the exchange of the currency in Scotland. It was also the organ of Government in the issue of the new silver coinage in 1817.

Bank of Scotland.-The Bank of Scotland was projected by Mr. John Holland, merchant, of London, and was established by Act of the Scotch Parliament (Wm. III. Parl. 1, s. 5) in 1695, by the name of the Governor and Company of the Bank The Bank of Scotland is the only Scotch bank of Scotland. Its original capital was 1,200,000l. constituted by Act of Parliament. It began to Scotch, or 100,0004, sterling, distributed in shares establish branches in 1696, and issued notes for one of 1,000Z. Scotch, or 831. 6s. 8d. sterling, each. pound so early as 1704. The bank also began at The Act exempted the capital of the bank from a very early period to receive deposits on interest, all public burdens, and gave it the exclusive and to grant credit on cash-accounts, a minute of privilege of banking in Scotland for 21 years, the directors with respect to the mode of keeping The objects for which the bank was instituted, the latter being dated so far back as 1729. It is, and its mode of management, were intended to be, therefore, entitled to the credit of having introduced and have been, in most respects, similar to those and set on foot the distinctive principles of the of the Bank of England. The responsibility of the Scotch banking system, which, whatever may be shareholders is limited to the amount of their shares. its defects, is perhaps superior to most other systems The capital of the bank was increased to 200,0007. hitherto established. Generally speaking, the Bank in 1744, and was enlarged by subsequent Acts of of Scotland has been cautiously and skilfully conParliament, the last of which (44 Geo. III. c. 23) | ducted; and there can be no doubt that it has been

productive, both directly and as an example to other banking establishments, of much public utility and advantage.

It may be worth mentioning, that the Act of Wm. III., establishing the Bank of Scotland, declared that all foreigners who became partners in the bank should, by doing so, become to all intents and purposes naturalised Scotchmen. After being for a long time forgotten, this clause was taken advantage of in 1818, when several aliens acquired property in the bank in order to secure the benefit of naturalisation. But, after being suspended, the privilege was finally cancelled in 1822. We subjoin an official abstract of the constitution and objects of the Bank of Scotland, printed for the use of the proprietors. The terms and mode of transacting business are, of course, sometimes altered, according to circumstances.

I. The Bank of Scotland is a public national establishment, erected and regulated by the legislature alone: and expressly as a public bank in this kingdom; for the benefit of the nation, and for the advancement of agriculture, commerce, and manufactures; and for other objects of public policy. (Wm. III. Parl. 1, s. 5; 14 Geo. III. c. 32; 24 Geo. III. c. 8; 32 Geo. III. c. 25; 34 Geo. III. c. 19; 44 Geo. III. c. 23.)

II. The statutory capital is at present 1,500,000l. sterling. It is raised by voluntary subscription; and has been subscribed for. 1,000,0007. has been called for, and paid in. (44 Geo. III. c. 23.)

III. Subscribers, if not under obligations to the bank, may, at pleasure, transfer their right. If under obligation to the bank, the obligation must be previously liquidated; or the proceeds of the sale, at a price to the satisfaction of the directors, must be applied towards such liquidation. Transfers are made by a short assignment and acceptance thereof, both in a register appointed for that purpose. The expense, beside the Government stamp, is 11s. (Wm. III. Parl. 1, s. 5.)

IV. Bank of Scotland stock may be acquired, in any portions, by any person, community, or other lawful party whatsoever; without selection, exclusion, or limitation of numbers. (Wm. III. Parl. 1, s. 5; 44 Geo. III. c. 23.)

V. Bank of Scotland stock may be conveyed by will, and if specially mentioned, without expense of confirmation. It cannot be arrested: the holder's right may be adjudged. Dividends may be arrested. (Wm. III. Parl. 1, s. 5.)

VI. The Bank of Scotland is a public corporation by Act of Parliament. The bank's transactions are distinct from those of the stockholders: and theirs from those of the bank. (Wm. III. Parl. 1, s. 5.) VII. The establishment is expressly debarred from any other business than that of banking. (Wm. III. Parl. 1, s. 5.)

VIII. The management is vested, by statute, in a governor, deputy governor, twelve ordinary, and twelve extraordinary, directors. They are chosen annually, on the last Tuesday of March, by the stockholders having 2504. of stock or upwards. Those above 2501. have a vote for every 250l. to 5,000Z., or 20 votes. No person can have more than 20 votes. The governor must hold, at least, 2,0007. of stock; the deputy governor 1,5007; and each director 7501. They swear to be equal to all persons; and cannot hold any inferior office in the bank. (Wm. III. Parl. 1, s. 5; 14 Geo. III. c. 32; 44 Geo. III. c. 23.)

IX. The executive part is conducted by a treasurer, secretary and other public officers, all sworn. Those having the official charge of cash find due security. (Wm. III. Parl. 1, s. 5.)

X. The board of directors sits for the general administration of the bank, at the bank's public

head office in Edinburgh. The local business of that district is also conducted at that office. For the local business in the other parts of the kingdom, the bank has its regular public offices in the principal towns. At each of these offices there is the bank agent or cashier, who gives due security, and conducts the bank's business for that district in the manner after mentioned. (Wm. III. Parl. 1, s. 5.)

XI. The bank takes in money at all its public offices, on deposit receipts or on current deposit accounts. At the head-office drafts on the branches, and at the branches drafts on the other branches and on the head-office are granted. Both at the head-office and branches drafts are granted on the London, Dublin, and English and Irish provincial correspondents of the bank. All receipts and drafts are on the bank's engraved forms, and bear to be granted for the Bank of Scotland,' or 'for the Governor and Company of the Bank of Scotland.' At the head-office official documents are signed by the treasurer, and at the branches by the agents, and all are countersigned.

Remittances can be made to the principal colonial and continental towns; and bills, payable in the colonies and in foreign countries, can be negotiated through the bank. (Resolution of Court, 1793, as since modified.)

N.B.-The bank has always allowed interest on deposits, at a rate varying according to circum

stances.

XII. Bills on London, Edinburgh, or any town in the United Kingdom, are discounted at all the bank's public offices. The bank's agents judge, in ordinary cases, of the bills presented; so that parties meet with no delay. The bank does not re-issue the bills which it has discounted. (Resolution of Court, Feb. 23, 1789, and subsequent Modifications.)

XIII. Government stock and other public funds may be purchased or sold, and dividends thereon may be received, through the bank.

XIV. The bank gives credit on cash accounts at any of its offices, on bond, with security. The security may be personal co-obligants, or such other security as may be specially agreed on. Applications for cash accounts are given in to the office where the cash account is wanted, and must specify the credit desired, and the security proposed; and the individual partners, where co-partneries are proposed. Cash accounts are granted by the directors only; and are not recalled unless by their special authority. It is understood that these credits are not used as dead loans, to produce interest only. In the fair course of business, the advantage of the bank is consulted by an active circulation of its notes, and by frequent repayments to it in a way least affecting that circulation. (Resolution of Court, Nov. 6, 1729, and Feb. 23, 1789.)

XV. The bank's dividend has been for some time 8 per cent, per annum on its paid-up capital of 1,000,000l. sterling. The dividends are paid regularly twice a year, without expense. They may be drawn either at the bank's head-office, or at any of its other oflices, as most agreeable to the stock-holder.

The above may suffice as a general outline of the mode in which the business of banking is conducted in Scotland.

The Royal Bank of Scotland was established in 1727. Its original capital of 151,0007. has been increased to 2,000,000Z.

The British Linen Company was incorporated in 1746, for the purpose, as its name implies, of undertaking the manufacture of linen. But the views in which it originated were speedily abandoued; and it became a banking company only. Its capital amounts to 1,000,000Z.

None of the other banking companies established in Scotland are chartered associations with limited responsibility, the parties being liable, to the whole extent of their fortunes, for the debts of the firms. Some of them, such as the Edinburgh and Glasgow Bank, the National Bank, the Commercial Bank &c. have very numerous bodies of partners. Their affairs are uniformly conducted by a board of directors, annually chosen by the shareholders. The Bank of Scotland began, as already stated, to issue 11. notes so early as 1704; and their issue has since been continued without interruption. 'In Scotland,' to use the statement given in the Report of the Committee of the House of Commons of 1826, on the Promissory Notes of Scotland and Ireland, the issue of promissory notes payable to the bearer on demand, for a sum of not less than

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20s., has been at all times permitted by law; nor has any Act been passed limiting the period for which such issue shall continue legal in that country.' Deposits.-All the Scotch banks receive deposits of so low a value as 101., and sometimes lower, and allow interest upon them.

The interest allowed by the banks upon deposits varies from time to time, according to the variations in the current rate of interest. And it has been estimated, by the best authorities, that the aggre gate amount of the sums deposited with the Scotch Banks is little, if anything, under 50,000,000Z.

We borrow from Oliver and Boyd's excellent Almanac for 1868 the following table, exhibiting the capital and other particulars of the Banks of Issue in Scotland, with the price of their shares, as publicly quoted in the third week of December 1867:

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• The capital of the banks marked with an asterisk is not in shares, but in stock transferable to any amount.
↑ Ex dividend.

Dividend and bonus.

A witness, connected for many years with dif- under 1007. or 2007., upon his own security, and ferent banks in Scotland, being examined by the that of two or three individuals approved by the Commons' Committee of 1826, stated that more bank, who become sureties for its payment. The than half the deposits in the banks with which he individual who has obtained such a credit is enhad been connected were in sums from 107. to 2007. abled to draw the whole sum, or any part of it, Being asked what class of the community it is when he pleases, replacing it, or portions of it, that makes the small deposits, he gave the follow- according as he finds it convenient; interest being ing answer; from which it appears that the mode charged upon such part only as he draws out. of conducting this branch of the banking business. If a man borrows 5,000l. from a private hand, in Scotland has long given to that country most part of the benefits derivable from the establishment of savings banks.

Q. What class of the community is it that makes the smallest deposits?

Ans. They are generally the labouring classes in towns like Glasgow: in country places like Perth and Aberdeen, it is from servants and fishermen, and that class of the community who save small sums from their earnings, till they come to be a bank deposit. There is now a facility for their placing money in the Provident Banks, which receive money till the deposit amounts to 10%. When it comes to 107. it is equal to the minimum of a bank deposit. The system of banking in Scotland is an extension of the Provident Bank system. Half-yearly or yearly those depositors come to the bank, and add the savings of their labour, with the interest that has accrued upon the deposits from the previous halfyear or year, to the principal; and in this way it goes on, without being at all reduced, accumulating (at compound interest) till the depositor is able either to buy or build a house, when it comes to be 100%, or 2004, or 3004., or till he is able to commence business as a master in the line in which he has hitherto been a servant. A great part of the depositors of the bank are of that description, and a great part of the most thriving of our farmers and manufacturers have arisen from such beginnings.'

Cash Accounts.-The loans or advances made by the Scotch banks are either in the shape of discounts, or upon cash-credits, or, as they are more commonly termed, cash accounts.

A cash-credit is a credit given to an individual by a banking company for a limited sum, seldom

besides that it is not always to be found when required, he pays interest for it whether he be using it or not. His bank credit costs him nothing, except during the moment it is of service to him, and this circumstance is of equal advantage as if he had borrowed money at a much lower rate of interest.' (Hume's Essay on the Balance of Trade.) This, then, is plainly one of the most commodious forms in which advances can be made. Cash-credits are not, however, intended to be a dead loan, though they not unfrequently become such; a main object of the banks in granting them is to get their notes circulated, and they do not grant them except to persons in business, or to those who are frequently drawing out and paying in money.

6

The system of cash-credits has been very well described in the Report of the Lords' Committee of 1826 on Scotch and Irish Banking. There is also,' say their lordships, one part of their system which is stated by all the witnesses (and, in the opinion of the committee, very justly stated) to have had the best effects upon the people of Scotland, and particularly upon the middling and poorer classes of society, in producing and encouraging habits of frugality and industry. The practice referred to is that of cash-credits. Any person who applies to a bank for a cash-credit is called upon to produce two or more competent sureties, who are jointly bound; and, after a full enquiry into the character of the applicant, the nature of his business, and the sufficiency of his securities, he is allowed to open a credit, and to draw upon the bank, for the whole of its amount, or for such part as his daily transactions may require. To the credit of the account he pays in such sums as he may not have occasion to use,

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