The Express.
London, England, 1857-12-09 00:00:00

JOINT-STOCK BANKS.

Mr. MUM:arose to move,--;'7llMt the unlimited
I dandity of shareholders in joint-dock banks gives
des to a species of audit injutioua to the interests
sf the public; and that the present law enforcing
the adoption of this principle requires alienation."
The reason that induced him to bring the question for-
ward was his rooted conviction, arrived at after the events
of 180, end enetirined by mote recent events, that the prin-
ciple of unlbuited liability led to the mismanagement of joint
stock banks, and that that mismanagement produced mai-
meroisl crises so their inevitable consequences. Ho believed
that if the principle had been abolished in 1849 we should
not now have to deplore suck wide-tread commercial
die-
eater ea had remedy been dmmed. He would sow lea way
few words proceed to mime the nature of Weems sad the pro-
pieties which he meant to ground on it. He contended
that In periods of trade preepsity, when there wee no peer
sate on the mosey market, the mismanagement of
joint stock beaks sewed the seeds of future commodes,
Gtr these broke, reser ing unbounded command of car-
tal, were ambled to looter idis specolationa, only to be over-
thrown by the Ant moment of pressure on the money Mr-
kilt. The second **tics was that unlimited liability
stabled them banks to incur an unlimited amount of debt,
thereby predpitating their fall when the panic came. When-
ever a panic or re eama, either from unfavourable
exchanges or bed harvests, then the inflatod credit of the
joint stock banks collet...ad, and the state of thing. occurred
which 111.11 described in the Bank directors recent letter.
On receipt of that letter the government did what they had
previously done is 1847, and the result ems the same la both
mars, namely, that the country. after severe diameter, at last
righted Well. The remedy was only temporary,
but at neither period as anything permanent
dune to prevent evil in future. Having explained the manner
in which capital accumulated in joint stock hanks drat by
all, and secondly by deposits a high interest, the hon.
member said that their machinery gave them the power of
mortgaging the whole property of a district, and thus of ac-
quiring unlimited credit In the money market. From this
it followed that however great might be the mismanagement
of the hank, it was always able to borrow money under the
dple of limited liabelity. la fact &course we. followed
porymthe corporation which no shareholder dared attempt in
lii. individual capacity. One of the most injurious of the
practices of these hanks was that of re-discount. The mats
on such traneectione wee the difference of diaeonnt between
the local and London money market, and thoret.re there wee
always a temptation to take In stimulative paper. Bat this
was in short, nothing but wiling the credit of the
shareholders. The bank thus beim. largely indebted
money market, and wee in consequence in a thoroughly Was
and unsound position. Abonk in such a position wee always
liable to have its advances stopped, and when they were
stopped there we. then nothing for it but to close die doors
and suspend payment, lie moot admit hie conviction that
this practioe of re-discount had not revelled in the London
joint stock banks. It world be found that whenever a failure
occurred the pried-up capital had been squandered, and this
generallfrom something mom then a mere emir of judg-
ment. When a bank found itself in such circumstances the
law should enable the shorcholdere at once to wind up or, If
they wished, to resew their cspital ; butes the law mood it was
perfectly possible for a hank to go on after ell its capital
lied been squandered, on this abused credit of the sham.
holden,. From year to year it would go on from bad to worm,
paying larger sums every time for secommedation, and in
venous other way. it we. compelled to carry on Its business
in an umeconomical manner, until at length the time cams
when failure was immediately in eight, and then If the
wealthy ahareholdees held on for a few years they got rid of
their charm, and left the burthen of the km on the poor and
telia= With such temptations it was no wonder that
was carried on until the occurrence of • panic in
the money routes when claims we, inevitable and whole
districts were ruined. It was unlimited liability that led
to all this, by meoweging misannagement, and pertaining
unbounded credit. . . .

-.11766Vi AN opposed the motion. Re had been always
opposed, he said, to nothing the liability of banks, and he
wee unoormineed by the speech of Mr. Headlam, who bad
mistaken the mum of the evils be bad mentioned, which had
resulted front a system of envoi mfinuanagement, brearhes of
trust, and premise. shish should be made Indictahle offeems.
Mr. COLLIER said, if the resolution had been based
upon the principle of non-laterlsrenee, leaving parties to do
as they pleased, be slosald rapport it; bat, as it pledged the
bowel to lbe madeseamlos of matitalted liability, be was
COM_ yeUed to vole %Oast It.
Mr. EWALT alai Mr. WIMO shortly supported the meolu•
the ; whisk was opposed by Mr. L. Kivu.
Ms. WZOIMLIN remarked that there was a distinction

between prinership commis that traded with their own
mosey, sad brake trading with the mem of others. To
limit the liability of tanks would be to Snit their audit,
which was their ask capital. He opposed the modem.
The CHANCELLOR of the EXCHEQUER rid, he
oonerred in the obrotien of Mr. Collier to the fora of the
rawhides, sad prorated estslast hg bound_ down to s
forma& that the unlimited liability of fortotodi banks was
Injurious to the interests of the public, the informos being
that it should to prnhitited. These beaks bed two footless
—cm the Mae of notes, soother the roodpt of &Fits ; sad
there ma a direction in rapid to liability between these
two filmdom. When a marry beak Mad motes, although
they went net • legal tender, they did protically discharge ,
the toned= of ropey ; theorem Assort of warm teak
etroolsted4Eo.a the credit of the. kiosk, sad It would sot be
to jor the holders of the mosrity of is red Ma-
i With our sot, is thag.ijudeos to the latreole
of the radio. The whole would, however, fell
within the rope of the el the onesdree the re-
apprising of which he as !day, sad no
wee under the sonority of oppoerg the retios.
Mr. MALINB wee of corer the petrilossirt should net
=osier la the opplicatios et the priselple of limited
, Mirk slosh be ended to tic_
as well as to
other roaches of trade.
Mr. HAWKEY moved, by way el assieadmist, the bb
resolution .—`• That the peasant kw, esfoidag the
unliwitwl liability of shareholders la Maar* basks, to-
mine alterstiou."
Mr. HEADLAM, in replying, observed that be did not'
think the motion ought to be got rid at by mord piseding,
sad expressed a hope that the hoar mold prosouase or
*rostra the law required siterstioa. Bellevrg MAIM
renerre el the ratter a asmoltro 5= 18
regaisey he arid act to
carrot to SS
arreierevor, had ao *Mien loW.the words
oldie migeond Ide Mend.
The origrel motion was then pat and negatived, and the
soushotot was pot so no MOW motion ; s which the
house divided. The atinabromeu
For the motion
Against ft
THE BEVERLEY ELECTION—PROSECUTION OF
MR. GLOVER.

Oa the motion of Mr. J. A. Slimly the probation which
apes the ird of Assume I. via= from the select
eeneelthe ea the Ewa* deeds was reed. The
both pselems Asa =mei, ty with that resole-
the, Mat Mr. Attorosy•Oarral is directed to prosecata
Meer/ Aorlorsty Orme, Rea respect of the dachas-
deal reds and signed by lir oder Meer the bat sod Sod
el Victoria, cep. 48 • that the sites of this brie
sal the shorthand :niter amrdup this homes have leave to
meths& sad give 'videos', rid to rodeos inch papers and
desassear ea may be retEalred es tie trial of the rid ad-
vent Anchor ty Glover, Seq.
The motion was agreed Is.
TRANSPORTS TO INDIA.
• • -

Oa the motionMm ordered it
the npmes of transports taken up far India, specifying whss
thee steamers or =ping vessels, their tonnage, If etestame
their horse power. the number se ma each corned, rate of
perms mousy, the date of sailing, sad the date of arrival as
it es le knows.

COMMIITBE ON PUBLIC PITMONB.
Oa the moths of kr. BONNAY Munn, the followleg
hoe. roseabirs wore appgated end sernMeted se the shot
oorawltter at public lender :—Mr. Bonham Carter, Mr.
Thaisely, Kr. Beow, Ms. Adeltoriey, Mr. Owen Beenley, Mr.
Homy Aunt& Brom, Mr. Grugem Mr. Do Vo.V.r..
WWI, Mr. Dillwyn, Mr. Clarke Ponta.,
Devises, Mr. Weeds, sod Mr. Termer John Miller
to be the quorum__