turer employing any great number of hands to collect the money required to pay the weekly wages of his people. It is not a valid argument against their utility that occasionally, by the facilities they have afforded, the tendency to overtrading has been encouraged. In 1826 the 7 Geo. IV. c. 6, provided for the gradual withdrawal of small notes from circulation, by prohibiting the future issue of any stamps for that purpose, and declared that their issue should wholly cease on the 5th of April, 1829. It was on the occasion of the introduction of this act that the Bank of England undertook, at the recommendation of government, to establish branches of its own body in different parts of the country. The practical effect of this measure of preventing the circulation of notes below l. value, has been to lessen, in an imporant degree, the issues of country bankers. Previously to their suppression, the small otes formed more than one-half the cirulation of country banks, whose issues ave not, however, been reduced in that roportion, owing to an enlarged amount f 51. notes being taken by the public: he reduction, on the whole, has been stimated at 30 per cent. It is generally cknowledged by country bankers themelves, that the description of notes withdrawn formed by far the most dangerous part of their issues; that in the event of ny run or panic, the notes of 17. value were always first brought in for payment, and that, in consequence, the situation of the country banker is now one of much greater security than it was while small notes were issued. The country bank notes in circulation in 1810 amounted to 23,893,8681. In July, 1844, the issues of private banks was 4,624,1797. and of jointstock banks 3,340,3261., being together less than eight millions. In February of the same year there were forty-three provincial bankers which, by an arrangement with the Bank of England, agreed to issue the notes of that establishment exclusively, to the amount of 2,429,000l. Up to 1832 no local circulation existed in the great manufacturing and trading County of Lancashire, where Bank of England notes alone passed from hand to hand, but a great number of payments were adjusted by means of bills of exchange drawn upon or made payable by London houses. Subsequently some of the joint-stock banks of Manchester and Liverpool issued notes. By 3 & 4 Will. IV. c. 83, banks issuing promissory notes were required, for the first time, to make quarterly returns to the Stamp-office of the average amount of notes in circulation; the quarterly average to be founded on the amount in circulation at the end of each week. The 4 & 5 Vict. c. 50, required the returns to be made at the end of every four weeks. The 7 & 8 Vict. c. 32, § 18, requires returns to be made of the notes in circulation on every day in each week; the average for the week; and a like average for every four weeks, and, as will be seen, gives the Commissioners of Stamps the power of inspecting bankers' books. At the time of passing the law for the suppression of small notes in England, provision was made by the legislature in the manner already described, for the establishment of joint-stock banks, which should be banks of issue, at any distance beyond sixty-five miles from London. In consequence of this act above one hundred joint-stock banking companies have been formed in England. About one hundred and thirty-eight private banks have been merged in joint-stock banks. The following table shows the number of joint-stock banks, &c. in the United Kingdom in January, 1839: England... 105 Scotland... 29 Ireland.... 18 Branches, No. of Partners. No. of Banks. &c. 648 32,142 Total ..152 Of the 29 Scotch banks, one established by act of parliament, and four by royal charter, are not required to lodge lists o partners. According to some valuable tables in the 'Bankers' Magazine' for August, 1844, the number of joint-stock banks in the United Kingdom at that date was as follows:-England and Wales, 106; Scotland, 20; Ireland, 10; and there were besides 10 joint-stock Colonial banks in London. Private Joint-stock Banks. Banks. 1826 554 1827 465 6 1828 456 7 1829 460 11 1830 439 15 The following is given in a Parlia- | tive restrictions on the operation of the mentary return as the number of pri- act 7 Geo. IV. c. 46, permitting the esta vate banks and joint-stock banks from blishment of joint-stock banks. A joint1826 to 1842:stock bank could start into existence, whether for the purpose of deposit or issue, or of both, without any preliminary obligation beyond the payment of a licence-duty and the registration of the names of shareholders at the Stamp Office. A secret committee of the House of Commons, appointed in 1836 to inquire into the operation of the abovementioned act, reported that the law did not require a revision of the deed of settlement by any competent authority; that there was no restriction on the amount of nominal capital, which varied from 100,000l. to 5,000,000l., and in one case an unlimited power was reserved of issaing shares to any extent; that banking operations might be commenced before the whole or any certain amount of shares enforce any rule with respect to the nobe subscribed for; that the law did not minal amount of shares, which vari! from 51. to 1000l., nor with the amet of paid-up capital before the commente ment of business, which varied from to 1057., and that the law was not suf ciently stringent to ensure to the pub that the names registered at the Stamp Office were the names of bona fide pr prietors, who, having signed the deed settlement, were responsible to the publ The committee also pointed out that the law did not limit the number of branches. or their distance from the central back and that the obligation of making the notes payable at the places of issue was disregarded. 1842 311 The average quarterly circulation of the private banks and joint-stock banks from September, 1834, to July, 1844, was as follows:Quarter Private Joint-stock Banks. £ 1,783,689 2,508,036 3,969,121 3,340,326 The system upon which the business of a joint-stock bank is conducted is the same generally as that pursued by private establishments; but it is, of rourse, more obligatory upon managers acting for others to adhere rigidly to system, than it is for an individual or a small number of partners without the same degree of responsibility. The disasters which befel several of the oint-stock banks ought long ago to have led to some general measure for placing these institutions on a safe footing. In 1837 there scarcely existed any legisla By 1 Vict. c. 73, shareholders in jointstock banks were rendered liable only the extent of their shares, instead of t whole of their property being answerab but up to the end of the parliamentary sion of 1844, the joint-stock bank syst.." laboured under a number of disadva tages, some of which are removed by th act 7 & 8 Vict. c. 113, "to regulate ja stock banks in England." Every Company is required by this act to prese:: a petition to the Queen in Council, signe by at least seven of the sharehuiders, praying that letters patent may be granted to them, and specifying very fully the 1,917,000l. was circulated by the branches. The bullion in the bank coffers was 1,037,100l. and the total securities amounted to 7,250,7007., consisting o 4,226,500l. public securities; 1,844,400! notes and bills discounted; and 1,179,800L, of other securities. The total deposits were 3,555,300l., of which 2,484,1007. were private, and 1,071,200l. public deposits. names and abodes of all the partners of | 1844, was 3,618,600l., of which sum the proposed company; the proposed name of the bank, and where the business is to be carried on; the proposed amount of capital stock, and the means by which it is to be raised; the amount already paid up, and where and how invested; the proposed number of shares, and the amount of each share, not being less than 1007. The petition will be referred to the Board of Trade, who will report as to the provisions of the act having been complied with. The deed of partnership must be prepared according to a form to be approved of by the Board of Trade. Banks already existing may be remodelled under the provisions of the act. Joint-stock banks have now the privilege of suing and being sued. The acts of an unauthorized partner formerly bound all the rest of the partners; but now it is only the acts of an individual director properly appointed which are binding on the shareholders. The Bank neither grants cash credits nor allows interest on deposits. The suspension of specie payments led, as in England, to the establishment of numerous private banks in Ireland; fifty of these were in operation in 1804. The power of issuing notes was greatly abused by these banks, and the mischief thus occasioned was aggravated by other individuals issuing notes also. It was given in evidence by several persons before a committee of the House of Commons, that about this time there were 295 issuers of paper money in Ireland, whose notes A national bank was established by were in some cases put forth for a few charter in Ireland in 1783, with the same shillings, and occasionally even as low as privileges as those granted to the Bank of 6d. and 3d. each. These issuers conEngland by the act of 1708. The origi- sisted of merchants, shopkeepers, and nal capital of this corporation was petty dealers of all descriptions. The 600,000l., and was lent to government consequences might easily have been at 4 per cent. interest. The manage- foreseen; forgeries and frauds innumerment is vested in a governor, deputy-go-able were committed, and it became nevernor, and fifteen directors. În 1809 1,000,000l. was added to its capital. This sum, which was raised by subscription mong the proprietors at the rate of 125 per cent., was also lent to government at 5 per cent. interest. In 1821 the capital was augmented to 3,000,000l., and a further prolongation of the charter was granted in 1808. cessary to put a legal stop to the practice. The mischief recoiled with severity upon the bankers, so that of the fifty who carried on business in 1804, only nineteen remained in 1812. A few had prudently withdrawn from business, but the remainder had failed; and of the nineteen here mentioned eleven became bankrupt in 1820. The number of private banks in Ireland is now only four. The system adopted by and in regard to the Bank of England has on various The mischief and misery thus occaccasions been extended to the Bank of sioned called loudly for the interference Ireland. In 1797, when it became ne- of government, and in 1821 an act was cessary to restrict the Bank of England passed (1 & 2 Geo. IV. c. 72) by which from paying its notes in gold, that mea-joint-stock banking companies were alsure was, almost necessarily, adopted in Ireland, and in consequence the issue of the Bank of Ireland notes increased from 780,000l., which it was in 1797, to upwards of 4,000,000l., before the Suspension Act was ultimately repealed. The total circulation of the Bank of Ireland for the week ending April 27, lowed to be established at a distance of fifty Irish (sixty-three statute) miles from Dublin. This district comprises a population of about 1,500,000, and the Bank of Ireland has only six branches, while in the various towns of Ireland beyond sixty-three miles from Dublin there are above one hundred branches of joint-stock banks. The Bank of Ireland has altogether twenty-four branches. The act 1 & 2 Geo. IV. was at first inoperative, in consequence of its omitting to repeal several vexatious restrictions; and it was not until after the passing of a new act in 1824, by which this error was remedied, that a joint-stock banking company was established in Belfast with a capital of half a million. This was followed in 1825 by the formation of the Provincial Bank of Ireland, with a subscribed capital of two millions, one-fourth part of which has been paid up by the shareholders. The shareholders are principally resident in England, where the management of the bank is conducted, the chief officer being in London. This association carries on business in thirty-six of the principal cities and towns of Ireland beyond the prescribed distance from Dublin. Each branch is managed, under the control of the directors, by an agent, with the advice and assistance of two or more gentlemen residing in the district, each of whom holds at least ten shares in the bank. The system of business adopted is the same as is followed by the Scotch banks. The benefit to the country from the introduction and prudent employment of so much capital has been very great. The notes of the Provincial Bank are received by the Irish government in payment for duties and taxes equally with the notes of the Bank of Ireland. The great grievance of the Irish jointstock banks is, that beyond sixty-three miles from Dublin they can neither draw nor accept bills for a less sum than fifty pounds, nor for any sum upon demand; and all such banks in Dublin, or within sixty-three miles, can neither issue notes nor accept or draw bills at all. When the charter of the Bank of Ireland again comes under the consideration of the legislature, some of these objectionable disabilities will probably be modified or removed. There are ten joint-stock banks in Ireland, including the Bank of Ireland, and branch banks are established in one hundred and fifty-six different towns. In the same year with the formation of the Provincial Bank, the directors of the Bank of Ireland, in 1825, began to estab lish branches in the country. The notes issued from these branches were not a first payable except in Dublin; but this inconvenience was rectified by the at 9 Geo. IV. c. 81, which makes it obligatory on all banks to pay their notes t the places where they are issued. Th regulation, which does not apply to baS in Scotland, renders it necessary to kep at all times a considerable supply of g at the branches; and from the political state of Ireland, this necessity is more particularly pressing. In 1828, during arun,' the Provincial Bank of Ireland sent over from the head-quarters in Lodon no less a sum than 700,000l. in go i to its branches. In Scotland the notes would have been payable at the beac office, where specie is easier provided. The law of 1826, forbidding the issue of notes under 5l. value, does not exter: to Ireland. Bank notes are not a legal tender in Ireland. V. Scotch system of Banking.-Ther are three incorporated public banks i Scotland: one of these, called the Bank Scotland, was established by act of Scottish parliament in 1695; another. called the Royal Bank of Scotland, received a royal charter in 1727; and th third, the British Linen Company, was incorporated in 1746, for the purposef undertaking the manufacture of liner. but now operates as a banking compary only; its capital is 500,000l. None the Scotch banks have exclusive priv leges resembling those of the Bank England and Bank of Ireland. The capital of the Bank of Scotlan was originally 1,200,000l. Scots, e 100,000l. sterling money, divided in 1200 shares. This capital has since been augmented at different times, and now amounts to 1,500,000l. sterling, but this sum only one million has been p up by the subscribers. This bank beg to establish branches in 1696, and issued notes for 17. each, in 1704. It also bega very early to receive deposits, for which it allowed interest; and in 1729 it introduced the plan of granting credits on cash accounts, which now forms a princi pal feature of the Scotch banking system. The nature of these cash accounts com sists in the bank giving credit on loan, to the extent of a sum agreed upon, to any individual or house of business that can procure two or more persons, of undoubted credit and property, to become surety for the repayment, on demand, of the sum credited, with interest. When a person has obtained this credit, he may employ the amount in his business, paying interest only upon the sum which he actually uses, and having interest allowed to him from the day of repaying any part of the loan. These loans are advanced in the notes of the bank, whose advantage from the system consists in the call which these credits produce for the issue of their paper, and from the opportunity which they afford for the profitable employment of part of their deposits. In order to render this part of their business as advantageous and secure as possible, it is necessary that the credits should be frequently operated upon; and if the managers of the bank find that they are used as dead loans to produce interest only, or that the operations of the borrower are infrequent, so that the amount of notes called for is inconsiderable during the year, they will speedily put an end to the credit, it being to the interest of the bank to keep up an active circulation of its notes. These cash accounts are found to be very advantageous to traders, by supplying an additional capital, for the use of which they pay only in proportion to the amount of it which they employ. The management of the Bank of Scotland is vested in a governor, deputygovernor, twelve ordinary and twelve extraordinary directors. They are chosen every year by the stockholders having 2501. of stock or upwards. The management of the various branches, which are opened in all the principal towns in Scotland, is confided to cashiers or agents. The Royal Bank of Scotland had at first a capital of 150,000l., which has since been increased to 2,000,000l. The system of business adopted by this establishment, and by the British Linen Company, is the same as that of the Bank of Scotland, which has already been described. The act of 1708, which restrained any association having more than six part ners from issuing notes payable to bearer, did not extend to Scotland, where banking companies, with numerous partners dealing on a joint-stock, have long existed. "There is no limitation upon the number of partners of which a banking company in Scotland may consist.""The partners of all banking companies are bound, jointly and severally, so that each partner is liable, to the whole extent of his fortune, for the whole debts of the company. A creditor in Scotland is empowered to attach the real and heritable, as well as the personal estate of his debtor, for payment of personal debts, among which may be classed debts due by bills and promissory notes; and recourse may be had, for the purpose of procuring payment, to each description of property at the same time."--(Commons' Committee on Scotch Banks, 1826.) In 1793 and 1825, when so many bankruptcies took place among country bankers in England, not one Scotch bank failed to make good its engagements. The Lords' Committee on Scotch Banks, in 1826, reported that "the banks of Scotland, whether chartered or joint-stock companies, or private establishments, have for more than a century exhibited a stability which the committee believe to be unexampled in the history of banking; that they supported themselves from 1797 to 1812 without any protection from the restrictions by which the Bank of England and that of Ireland were relieved from cash payments; that there was little demand for gold during the late embarrassments in the circulation; and that in the whole period of their establishment there are not more than two or three instances of bankruptcy, and as, during the whole of this period, a large portion of their issues consisted almost entirely of notes not exceeding 17. or 1l. 18., there is the strongest reason for concluding, that as far as respects the banks of Scotland, the issue of paper of that description has been found compatible with the highest degree of solidity." In another respect the law which regulates the system of banking in Scotland differs from that in force in England. The act of 1826, which put an end to the circulation of notes under 5l., does not extend to Scotland, |