ought to submit to publicity-to such publicity as the parties granting the charter might require-not that of a newspaper. Those who ask for privileges must pay for them. Private bankers do not seek them.

9. Branch Banks, practice of Business, &c. (p. 1109.).

It is no more a privilege to issue notes than to draw a bill of exchange, or but little. The expense of the issue of notes is about one to two per cent. per annum. This includes paper, printing, stamps, the sum kept at home in coffers, and the sum at the London agents. The proportion of assets to issues kept in the bank at Bristol, forms, in ordinary times, a reserve of 21. for every 201. out. If clamour arise, the reserve must be increased. The discussion of this question has lately rendered an increase necessary. Since the branch banks have been established, greater security has been felt in private concerns, because sovereigns can be got from thence without sending to London. They (the joint stock bank) are thereby enabled to do with less gold than formerly. In cases of a run, the public are usually satisfied by getting Bank of England paper. The branch banks have a tendency to defeat the action of private banks; they receive many dividends that used to be received by other bankers. The latter are in some respects obliged to charge less to their customers for doing business. The public gain by competition; but if a bank has not a fair remunerating profit, it cannot answer in the long run. Industry may suffer, inasmuch as that establishments, guided by written rules, cannot afford that assistance, by way of loans, &c. which can be given by private bankers, acquainted with their neighbours. Formerly, if gold was wanted to meet a run, it must have been got from London; it is one of the advantages derived from the branches, that they take the risk and expense of bringing down the supplies needed by the country.

10. Panic, Political Discredit, &c. (p. 1142.)

Independently of assets in London, the private banks keep a deposit of bank notes and gold-in general of branch bank notes, or balances there, for which they can readily get sovereigns. In cases of panic, or political discredit, they rely on the Bank of England for supplies of specie; but to get it, they must of course either have money at the Bank, or stock to sell. During the recent political discredit, the Bank would have incurred more responsibility if London notes had been issued in its name. Country paper was at that time preferred. If the branches had then existed, many of them must have stopped. In cases of commercial as well as of political discredit, the paper of country bankers who are known and confided in, may chance to remain in the coffers of farmers and persons of that description, when Bank of England paper would not. But in the interior of the country, where the circulation lies amongst agriculturists, and people of no education, little is known of commercial discredit. Runs often proceed from

an undefined sensation of alarm-one demands gold because another does. When there is an excess of paper in the country, it will come in on a slight alarm, by whomsover issued. A country banker, having an estate of 6000l. to 10,000l. a year in land, the farmers, and persons who know the fact, would doubtless prefer his paper to all the bank notes in the world.

11. Loss by Forgeries small. (p. 1156.)

The loss by forgeries to the Bristol bank has not been 100%. during an existence of sixty years. They feel as secure against losses of that kind as the subject will admit. Farmers bringing Bank of England paper to their counter, often say, they don't know whether it is true or not, but can judge of their notes. Not much has been lost by forgeries of Bank of England notes, particularly since the discontinuance of 17. and 27 notes.

12. Small Banks less liable to Panics than large ones, however responsible, &c. (p. 1168.)

"Do you think that a circulation that should rest upon the security of separate banks scattered over the country, would be less liable to universal distrust, than a circulation issued by a great body, however responsible?"-" I do think so." A banker in credit has generally as much upon his drawing and deposit accounts as on his circulation. His ability to afford accommodation to persons paying their rents, &c., as before stated, depends greatly, but not entirely, on his issues. An old bank, the notes of which have been regularly paid, attracts more deposits, and enjoys more credit, than would be the case if they discounted only, and issued no notes at all. The circulation of notes, payable in London, makes a bank known all over the kingdom.

13. Profits from Circulation equal to one-third of the whole, &c. (p. 1178.)

In the establishment of witness, the profits from the circulation is about one-third of the gross profits: this circulation is perhaps large in proportion to the drawing and deposits account; but in Somersetshire, people have always been accustomed to require much of their paper. Most certainly, banks having a circulation of their own, are able to afford more accommodation than those that have none; perhaps as well in manufacturing districts as in agricultural.

14. Principles of Circulation, &c. (p. 1186.)

The Bank of England reduced its issues 2,000,000l. from 1823 to 1824, and to 1820 only increased them by 120,000.; this does not seem an over liberality to have produced the panic; but then the quantity of specie in circulation should be considered. With regard to a demand on the Bank of gold for foreign purposes, it would appear that if the precious metals are kept at the mint price, and the changes in favour of the country, it could not be called on for any great quantity of specie. Whether at any given

time, say when large foreign loans were to be remitted, the Bank might think proper to export bullion, is a question. A diminution of their issues might prevent the necessity, by taking away all profit on the export of gold, and other commodities would be sent.

15. Panic of 1825. (p. 1194.)

During the panic of 1825, witness took down from London Bank notes and gold enough to pay three-fourths of his circulation, 100,000/. in notes, and only 30007, in sovereigns. The Bank notes answered all purposes. In this case, supposing the Bank to have been guided by the foreign exchanges alone, and had not issued its paper, the distress would have been greater; but then there was no actual increase to the circulation, it was merely a substi tution of A. for B. They issued a million a day; if they had not, most of the banks in London, as well as in the country, must have stopped. On the 13th of December in that year, the exchanges were favourable; therefore the Bank did not, strictly speaking, contravene the standard principle; but had it been otherwise, when Bank notes were called for in lieu of country notes, supplies were indispensable. In ordinary times, if rules are acted on, panics would not occur; when they do occur, new principles come into

action.

16. Joint-Stock Banks: terms on which Country Gentlemen would join them. (p. 1203.)

The law forbids the establishment of banks of issue within sixtyfive miles of London. That distance might, in all probability, be safely lessened, but that no bank of circulation should be allowed in London, but the Bank of England. A limited responsibility in the case of partners in a joint bank, would induce many gentlemen to unite in such, who now do not like to risk their whole fortunes because of a share infinitely less. If persons of large landed estates were made liable for twice or three times the amount of their shares, it might possibly do. A country bank, having a charter, should lend a capital to government at a certain interest, and have it repaid at par; and perhaps some regulation could be adopted, by which the Bank could get the money in case of alarm.

17. Experience of the past will prevent Panics in future. (p. 1208.)

The experience of the past is some security to the public, that mismanagement in issues with the Bank of England shall not occur again; still, in extraordinary times, it may be proper to permit them to pay in uncoined gold: in that event, government should have a daily account from the Bank, to keep the thing in check. Previous to 1825 they did not look carefully to the exchanges; since, they have pursued a system which has kept the circulation pretty equal. Their own safety will prompt them to continue this system.

18. In favour of one Bank of Issue in London. (p. 1214.)

A competition of banks of issue in London, would not have a tendency to increase security, but the reverse. On the spot where the foreign exchanges are regulated it would be dangerous. The check of a daily account from the Bank to the government, in paying in uncoined gold, is only proposed with a view to having the earliest possible return to the regular payment. The public cannot readily have better security for the conduct of the Bank than the regard it must have for its own safety. Witness is o opinion, that the proper principles are now acted on by the Bank, and that they will seldom, if ever, get into difficulty, unless at a period of popular commotion, which would be most likely brought on by no fault of theirs.

19. Chartered Banks would bring us to a sound system of Banking. (p. 1218.)

He is further of opinion, that chartered banks, with a paid-up capital, and limited responsibility of partners, would, in the course of years, bring us to a sound system of banking. The limited responsibility would expedite the formation of such banks, and probably increase their stability, by adding to the numbers and character of the partners. Chartered banks of this kind have been tried in America; they have not succeeded well, because the thing was overdone, and altogether improperly managed. They have there a very bad system of banking, and have suffered accordingly. The objections laid against the Bank of England lending money to government would not apply to the chartered companies; the evil is in the lending money not properly at disposal, when pressed by authority. It is imperatively essential to the interests of the community, that the question under discussion should be speedily settled.

20. Resolution of Country Bankers against the monopoly of the Bank of England. (p. 1233.)

Here was handed the following resolution, passed at a late meeting of country bankers :-"That it appears to this committee highly inexpedient that the circulation of the country should be confined solely to the Bank of England, and that they will exert themselves, to prevent a measure so highly detrimental to the agricultural, commercial, and manufacturing interests."

FRIDAY, JUNE 15.

WILLIAM BECKETT, ESQ.

Banker at Leeds.

1. Practice of Business. (p. 1234.)

The circulation of the Leeds bank, which is a bank of issue, but not of joint stock partners, under the late Act, is produced, by pay

ment to the customers of the bank. Checks are sent by those who have accounts with the bank, and its notes are given out for the sum required. A few bills are discounted across the counter, and many to the bank's customers. Money is lent on securities, real and personal, on the deposits of deeds, and on the character and credit of the borrowers, who are generally merchants or manufacturers. The money is lent sometimes for long periods, and it varies in amount. Interest of 2 per cent. is paid on deposits that remain six months in the bank, after that term the interest is payable on demand. The Leeds notes are not payable in London. The accounts are made every six months; and, in running accounts, the interest due to parties is carried to their credit, charging a commission of one and a quarter upon the current account, where it oscillates, but not upon deposits. Very small sums are received as deposits, and take interest: this is to accommodate the middling class. On bills discounted, four per cent. is the simple charge. The bank is often in advance to creditors of good character: it charges four per cent. in such cases. The commission charged on open, or ledger accounts, is general among the country banks.

2. Circulation, State of Leeds, its Trade, &c. (p. 1282) The circulation of the bank is under one-fourth of its deposits. The circulation is a subordinate part of the bank business, and is merely to supply wages and such demands, at short periods. One part of the funds is employed in government securities in London, the other part in discounting bills for customers at Leeds. The government securities are the source whence any drain on the circulation and deposits must be met. All deposits are payable on demand. The bank has been established fifty-eight years. The trade of Leeds during that time has increased greatly, and with it, the business of the bank also. The establishment of the bank at Leeds has conduced considerably to the growth of the trade. Accommodation has much extended the operations of the manufacturers. At present the state of Leeds is the reverse of prosperous; its traders have not been doing prosperously, or to advantage, nor are they so wealthy as they were a few years back. It would be impossible to pay wages, &c. regularly, without the accommodation derived from the bank. The bank would continue to give accommodation were it to be prevented from issuing notes; but without such issue, perhaps, it could not have materially benefited trade as it has done. Gold and silver, however, as well as notes, are advanced by the bank to merchants, &c. perhaps two-thirds gold and one-third in notes of the bank of Leeds. Before 1826, considerably more than half the circulation was in 1. notes, which were gradually withdrawn up to 1829. Wages, now paid in gold, were then paid in 17. notes. The same facility in making advances exists now as did before the change of system. Very lately the mode of manufacture in Leeds is changing; the making of cloth is reverting to the villages, and becoming a domestic manufacture. There is now more competition than formerly, which reduces