The Sun.
London, England, 1866-08-07 00:00:00

The Bank Charter Act of 1844.—Cap• 32.

An Act to Regulate the Issue of Bank Notes,
and for giving to the Governor and Company of
the Bank of England certain Privileges for a
Limited Period.-19th July, 1844.
Whereas it is expedient to regulate the issue of
bills or notes payable on demand : And -whereas an
act was passed in the fourth year of the reign of his
lateMajestyKing"WilliamlV., intituled "AnAct for
giving to the Corporation of the Governor and
Company of the Bank of England certain Privi-
leges for aLimitedPeriocl, under certain Conditions;"
and it is expedient that the privileges of exclusive
banking therein mentioned should be continued to the
said governor and company of theßank of England,
with such alterations as are herein contained, upon
certain conditions : May it therefore please your
Majesty that it may be enacted ; and be it enacted
by the Queen's most excellent Majesty, by and with
the consent of the Lords Spiritual and Temporal,
and Commons, in this present Parliament assem-
bled, and by the authority of the same,—That from
and after the 31st day of August, 1844, the issue of
promissory notes of the governor and company of
the Bank Of England, payable on demand, shall be
separated and thenceforth be kept wholly distinct
from the general banking business of the said gover-
nor and company ; and the business of and relating
to such issue shall be thenceforth conducted and car-
ried on by the said governor and company in a sepa-
rate department to be called " the Issue Department
of the Bank of England," subject to the rules and
regulations hereinafter contained ; and it shall be
lawful for the court of directors of the said gover-
nor and company, if they shall think fit, to appoint
a committee or committees of directors for the
conduct and management of such issue department
of the Bank of England, and from time to time to
remove the members, and define, alter, and regu-
late the constitution and powers of such committee,
as theyshall think fit, subject to anybyelaws, rules,
or regulations which may be made for that purpose:
provided nevertheless, that the said issue depart-
ment shall always be kept separate and distinct
from the banking department of the said gover-
nor and company.
Ik And be it enacted, that upon the 31st day of
August, 1844, there shall be transferred, appro-
priated, and set apart by the said governor and
company of the issue department of the Bank of
England securities to the value of fourteen million
pounds, whereof the debt due by the public to the I
said governor and company shall be and be deemed
a part ; and there shall also at the same time be
transferred, appropriated, and set apart by the
said governor and company to the said issue depart-
ment so much of the gold coin and gold and silver
bullion then held by the Bank of England as shall
not be required by the banking department thereof ;
and thereupon there shall be delivered out of the
said issue department into the said Banking Depart-
ruent of the Bank of England such an amount of
Bank of England notes as, together with the Bank
of England notes then in circulation, shall be
equal to the aggregate amount of the securities,
coin, and bullion so transferred to the said issue
department of the Bank of England ; and the whole
amount of Bank of England notes then in circula-
tion, including those delivered to the banking de-
partment of the Bank of England as aforesaid,
shall be deemed to be issued on the credit of such
securities, coin, and bullion so appropriated and set
apart to the said issue department ; and from thence-
forth it shall not be lawful for the said governor
and company to increase the amount of securities
for the time being in the said issue department, save
as hereinafter is mentioned, but it shall be lawful
for the said governor and company to diminish the
amount of such securities, and again to increase
the same to any sum not exceeding in the whole
the sum of £14,000,000, and so from time to time
as they shall see occasion ; and from and after such
transfer and appropriation to the said issue depart-
ment as aforesaid it shall not be lawful for the said
governor and company to issue Bank of England
notes, either into the banking department of the
Bank of England, or to any persons or persons what-
soever, save in exchange for other Bank of England
notes, or for gold coin or for gold or silver bullion
received or purchased for the said issue department,
under the provisions of this act, or in exchange for
securities acquired and taken in the said issue de-
partment under the provisions herein contained :
Provided always, that it shall be lawful for the
said governor and company in their banking depart-
ment to issue all such Bank of England notes as
they shall at any time receive from the said issue
department or otherwise, in the same manner in all
respects as such issue would be lawful to any other
person or persons.
111. And whereas it is necessary to limit the
amount of silver and bullion on which it shall be
lawful for the Issue Department of the Bank of
England to issue Bank of England notes : Be.it
therefore enacted, that it shall not be lawful for the
Bank of England to retain in the issue department
of the said bank at any one time an amount of
silver bullion exceeding one-fourth of the gold coin
and bullion at such time held by the Bank of Eng-
land in the issue department.
IV. And be it enacted, that from and after the
31st day of August, 1844, all persons shall be en-
titled to demand from the issue department of the
Bank of England Bank of England notes in ex-
change for gold bullion, at the rate of £3 17s. 9d.
per ounce of standard gold : Provided always, that
the said governor and company shall in all cases
be entitled to require such gold bullion to be melted
and assayed by persons approved, by the said
governor and company, at the expense of the par-
ties tendering such gold bullion.
V. Provided always, and be it enacted, that if
any banker who on the 6th day of May, 1844, was
issuing his own bank notes shall cease to issue his
own bank notes, it shall be lawful for her Majestyin
Council, at any time after the cessation of such
issue, upon the application of the said governor and
company, to authorise and empower the said gover-
nor and company to increase the amount ° f securi-
ties in the said issue department beyond
the total
sum or value of £,14,000,000
' and thereupontesto to
issue additional Bank of England no
amount not exceeding such increased amount an
of
securities specified in such order in Council, and
from time to time : provided always, that such s°
in-
creased amount of securities specified in such Order
in Council shall in no case exceed the proportion
of two-thirds the amount of bank notes which the
banker so ceasing to issue may have been autho-
rised to issue under the provisions of this act ; and
every such Order in Council shall be published in
the next succeeding London Gazette.
VI. And be it enacted, that an account of the
amount of Bank of England notes issuan e
d d byd
the
issue department of the Bank of Engl, anof
gold coin andof gold and silver bullion respectively,
and of securities in the said issue department, and
also an account of the capital stock, and the depo-
sits, and of the money and securities belonging to
the said governor and company in the banking
department of the Bank of England, on sonic day
in every week to be fixed by the Commissioners of
Stamps and Taxes, shall be transmitted by the said
governor and company weekly to the said Com-
ussioners in the form prescribed in the schedule
hereto annexed marked (A), and shall be published
by the said Commissioners in the next succeeding
London Gazette in which the same may be con-
veniently inserted.
VII. And be it enacted, that from and after the
said 31st day of August, 1844, the said governor
and company of the of Bank England shall be
released and discharged from the payment of any
stamp duty, or composition in respect
duty, upon or in respect oftie promissory
notes allre e
andch
roofmsitsasomrPy
and such
notes payable to bearer on demand
notes shall thenceforth he and continue
wholly exempt from all liability to any stamp duty
whatsoever.
yfli. And be it enacted, that from and after
t
the said 31st day of August, 1844, the payment
or deduction of the annual sum of £120,000,y
made by the said governor and company, under
the provisions of the said act passed in the fourth
year of the reign of his late Majesty Icing -William
the Fourth, out of the sums payable to them for
the charges of management of the public unre-
deemed debt, shall cease, and
in lieu thereof the
said governor and co.npany, in consideration of the
privileges of exclusive banking, and the exemption
from stamp duties, given to them by this act,
shall, during the continuance of such privileges
and such exemption respectively, but no longer,
deduct and allow to the public, from the sums now
payable by law to the said governor and company for
the charges of management of the public unredeemed
debt, the annual sum of £lBO,OOO, anything in any
Act or Acts of Parliament, or in any agreement, or the

contrary notwithstanding : Provided always, that
such deduction shall in no respect prejudice or affect
the rights of the said governor and company to
be paid for the management of the Public Debt,
at the rate and according to the terms provided in
an Act passed in the 48th year of the reign of his
late Majesty King George 111., intituled " An Act
to Authorise the Advancing for the Public Service,
upon certain conditions, Proportion of the Ba-
lance remaining in the Bank of England, for the
Payment of Unclaimed Dividends, Annuities, and
Lottery Prizes, and for Regulating the Allowances
to be made for the Management of the National
Debt."

IX. And be it enacted, that in case, under the
provisions hereinbefore contained, the securities
held in the said issue department of the Bank of
England shall at any time be increased beyond
the total amount of £14,000,000, then and in each
and every year in which the same shall happen,
and so long as such increase shall continue, the said
goiernor and company shall, in addition to the
said annual sum of £lBO,OOO, make a further pay-
ment or allowance to the public, equal in amount to
the net profit derived in the said issue department
during the current year from such additional secu-
rities, after deducting the amount of the expenses
occasioned by the additional issue during the same
period, which expenses shall include the amount of
any and every composition or payment to be made
by the said governor and company to any banker in
consideration of the discontinuance at any time
hereafter of the issue of bank notes by such banker ;
and such further payment or allowance to the public
by the said governor and company shall, in every
year while the public shall be entitled to receive the
same, be deducted from the amount by law payable
to the said governor and company for the charges of
management of the unredeemed public debt, in the
same manner as the said annual sum of £lBO,OOO
is hereby directed to be deducted therefrom.
X. And be it enacted, that from and after the
passing of this Act no person other than a banker
who on the 6th day of May, 1844, was lawfully
issuing his own bank notes shall make or issue bank
notes in any part of the United Kingdom.
' XI. And be it enacted, that from and after the
passing of this Act it shall not be lawful for any
banker to draw, accept, make, or issue, in Eng-
land or Wales, any bill of exchange or promissory
note, or engagement for the payment of money
payable to bearer on demand, or to borrow, owe, or
take up in England or Wales, any sums or sum of
money on the bills or notes of such banker payable
to bearer on demand, save and except that it shall
be lawful for any banker who on the 6th day of
May, 1844, carrying on the business of a banker in
England or Wales, and was then lawfully issuing, in
England or Wales, his own bank notes, under the
authority of a licence to that effect, to continue to
issue such notes to the extent and under the
conditions hereinafter mentioned, but not further
or otherwise ; and the rights of any company or
partnership to continue to issue such notes shall
not be in any manner prejudiced or affected by
any change which may hereafter take place in the
personal composition of such company or partner-
ship, either by the transfer of any shares or share
therein, or by the admission of any new paitner
or member thereto, or by the retirement of any
i present partner or member therefrom : Provided
always, that it shall not be lawful for any com-
pany or partnership now consisting of only six
or less than six persons to issue bank notes at any
time after the number of partners therein shall ex-
I ceed six in the whole.
XII. And be it enacted, that if any banker in
any part of the United Kingdom who after the pas-
sing of this act shall be entitled to issue bank notes
shall become bankrupt, or shall cease to carry on
the business of a banker, or shall discontinue the
issue of bank notes, either by agreement with the
governor and company of the Bank of England
or otherwise, it shall not be lawful for such banker
at any time thereafter to issue any such notes.
XIII. And be it enacted, that every banker
claiming under this act to continue to issue bank
notes in England or Wales shall, within one month
next after the passing of this act, give notice in
writing to the Commissioners of Stamps and
Taxes at their head office in London of such
claim, and of the place, name, and firm at and
under which such banker has issued such notes
during the twelve weeks next preceding the 27th
day of April last ; and thereupon the said com-
missioners shall ascertain if such banker was on the
6th day of May, 1844, carrying on the business of a
banker, and lawfully issuing his own bank notes in
England and Wales, and if it shall so appear then
the said commissioners shall proceed to ascertain
the average amount of the bank notes of such banker
which were in circulation during the said period of
twelve weeks preceding the 27th day of April last,
according to the returns made by such banker iu
pursuance of the Act passed in the fourth and fifth
years of the reign of her present Majesty, intituled
" An Act to make further Provision relative to the
Returns to be made by Banks of the Amount of their
Notes in Circulation ;" and the said commissioners
or any two of them shall certify under their hands
to such banker the said average amount, when so
ascertained aforesaid; and it shall be lawful for
every such banker to continue to issue his own
bank notes after the passing of this Act : Provided
nevertheless, that such banker shall not at any time
after the 10th day of October, 1814, have in circula-
tion upon the average of a period of four weeks,
to be ascertained as hereinafter mentioned, a greater',
amount of notes than the amount so certified.
XIV. Provided always, and be it enacted, that it
shall be made to appear to the commissioners of
stamps and taxes that any two or more banks have,
by written contract or agreement (which contract or
agreement shall be produced to the said commis-
sioners), become united within the twelve weeks
next preceding such 27th day of April as aforesaid,
it shall be lawful for the said commissioners to as-
certain the average amount of the notes of each
such bank in the manner hereinbefore directed,
and to certify the average amount of the notes of
the two or more banks so united as the amount
which the united bank shall thereafter be authorised
to issue, subject to the regulations of this act.
1 XV. And be it enacted, that the Commissioners ,
of Stamps and Taxes shall, at the time of certify-
ing to any banker such particulars as they are
hereinbefore required to certify, also publish a du-
plicate of their certificate thereof in the next suc-
ceeding London Gazette in which the same may
be conveniently inserted ; and the Gazette in
which such publication shall be made shall be
conclusive evidence in all courts whatsoever of
the amount of bank notes which the banker
named in such certificate or duplicate is by law
authorised to issue and to have in circulation as
aforesaid.
XVI. And be it enacted, that in case it shall be
made to appear to the Commissioners of Stamps ,
and Taxes, at any time hereafter, that any two or
more banks, each such bank consisting of not more
than six persons, have, by written contract or
agreement (which contract or agreement shall be
produced to the said commissioners), become united
subsequently to the passing of this Act, it shall be
lawful to the said commissioners, upon the application
of such united bank, to certify, in manner herein-
before mentioned, the aggregate of the amount of
hank notes which such. separate banks were previ-
ously authorised to Issue, and so from time to time;
and every such certificate shall be published in man-
ner hereinbefore directed ; and from and after such
publication the amount therein stated shall be and
bn e
providedo deemedtes
which unit ed
always,thabt anikt
to be the limit of the amount of bank
shall l not b
mayshahave in circulation
lawful l
o r
any such united bank to issue bank :
notes at any time
• after the number of partners therein shall exceed
six in the whole.
XVII. And be it enacted, that
if the monthly
average circulation of bank notes of any banker,
taken in the manner hereinafter directed,
shall at
any time exceed the amount which such banker is
authorised to 'issue and to have in circulation under
the provisions of this act, such banker shall in
every such case forfeit a sum equal to the amount
by which the average monthly circulation, taken
as aforesaid, shall have exceeded the amount which
such banker was authorised to issue and to have in ,
circulation as aforesaid.
XVIII. And be it enacted, that every banker in
England and
Wales who, after the 10th day of
October, 1844, shall issue bank notes, shall,
the 19 h d on
t
some one day in every week after ay of
to be fixed by the Com-
October, 1844 (such day
Tlxes) transmit to the
missioners of Stamps and , ,
said Commissioners an account of the amount of
bank notes of such banker in circulation on every
day during the week ending on the next preceding
Saturday, and also an account of the average
amount of the bank notes of such banker in circula-
tion during the same week ; and on completing
the first period of four weeks, and so on complet-
ing each successive period of four weeks, every
such • banker shall annex to such account the
average amount of bank notes of such banker in
circulation during the said four weeks, and also the
amount of bank notes which such banker is
authorised to issue under the provisions of this act ;
and every such account shall be verified by the
signature of such banker or his chief cashier, or, in
the case of a company or partnership, by the signa-
ture of a managing director or partner or chief
company cashier of such or. partnership, and shall
be made in the form tot
th is act annexed marked
th
(B) ; and so much of the said
th
said return as states the
weekly average amount o
shall be published by the said the notes of such bank
commissioners in the
next succeeding London Gazette in which the same
may be conveniently inserted, and •
if any such
banker shall neglect or refuse to render any
such
account in the form and at the time
required by