The Sun.
London, England, 1845-06-10 00:00:00

Mr HUME considered that the bankers of Scotland should
not be interfered with, with respect to their issues, when there
was no occasion for it.
After a few words from Sir W. CLAY,
Mr. DENNISTOUN said he was astonished to hear the
remarks which had just fallen from the Hon. Member for
the Tower Hamlets, for he would just ask what had been the
facts of the case referred to ? The Scotch banks had at .nne
time been apprehensive of a run, and they got 50,0001. in gLld
from England, but from that day to this not, a single pun i ha d
been received from England.
Mr. COLLETT rose to notice a trifling omission which was
perhaps of no great consequence after all. He meant the
omission of the word " silver" in the clause.—(Laughter.)
The clause was then agreed to, as were clauses 10, 11, and 12.
On clause 13 being proposed,
Mr. P. M. STEWART moved that at the end of the clause
the following words be inserted .—" Provided always, that such
banker shall not be liable in such penalty, unless the aggregate
amount of such monthly circulation of all the bankers in Scot-
land shall exceed the aggregate amount of the average circu-
lation of all the banks in Scotland, to be taken in manner
herein provided." Now he said in conclusion that if the banks
collectively were to work out the contraction and expansion
principle to which the Right Hon. Baronet referred, they must
adopt the amendment. With regard to its being practicable, let
it go into the Bill, and he had no doubt but it would work
satifactorily.
Sir R. PEEL was really afraid of arguing the question any
longer. The Hon. Gentleman talked of the penalty being
tremendous. Now, in case of cccessive issue, a bank no doubt
did incur a penalty. Supposing a banker were to issue
100,000 i. in notes more than he could pay, there was no
penalty provided against his so doing, there was no penalty! except by a joint action. It was not possibfei it was true, to
prognosticate whether or not such a case might arise. Sup-
posing the emergency should arise that the issue of Scotland
should fall below 3,500,000. by effecting the union of banksthe
most effectual precaution had been taken for guarding
against any danger arising from such a diminution. He must
oppose the amendment •as it contained every absurdity that
could be imagined.
Mr. TURNER having spoken a few words,
Mr. STEWART said, the whole circulation was the same
now in Scotland as was provided for by the proposed Bill.
The measure was only intended to restrain speculation and un-
due circulation. He would say let the Bill be judged of under
all circumstances, and then a competent opinion could be
formed of it. The Bill had been treated throughout too much
as a banker's Bill, and not a measure for the people of Scotland.
It was right that improper restrictions might be guarded against ;
and if his amendment was not received, the Government would
rue it.

Sir R. PEEL said the Hon. Member evidently wished to
give a portion of Scotch bankers an advantage over others,
and he could, by no means, agree to the amendment.
The amendment having been negatived without a division,
the remaining clauses of the Bill were agreed to.
On the motion being put fir the Chairman reporting
progress,
Mr. HUAIE rose and said he wished to have a last word on
the Bill before it went out of Committee. His principal ob-
jection to the Bill was, that it limited the number of banks, and
established one of the worst systems of monopoiy. There
ought to be freedom in trade, in money, and cheques, as well as
in corn or anything else, and the Right Hon. Baronet, in his
opinion, was contravening the whole principle he so ably laid
down and explained to the House in 184:3.
Sir R. PEEL said the Bill placed no restrictions on the
number of banks. No restrictions whatever were placed upon
banks employing capital in a legitimate way, but the Hon.
Gentleman had formed an erroneous conception of the Bill.
It only restricted the number of banks dealing in paper, and by
such means limited the number of banks dealing in gold.
After a few words from Mr. Flume, Mr. P. Stewart, and
other Hon. Members, the House resumed, when
The CHAIRMAN reported progress, and the report was
ordered to be brought up to-morrow.
THE IRISH BANKING BILL.
On the question being put for the House going into Com-
mittee on this Bill,
Mr. ROSS said it would be his duty to detain the House
for a few minutes before going into Committee. A meeting of
merchants and others had, he said, been held in .the Hall of
Commerce in Dublin, where resolutions were passed denouncing
the present Bill, as being of a mischievous character, and in-
jurious to the best interests of the country. His own objec-
tion to the Bill, and he believed it was an objeelion very ge-
nerally-entertained in Ireland, was to the mode in which the
averages were proposed to be taken. In consequence of most
of the banks in Ireland having provincial branches, every banker
would have to make a deposit of 3/, for every I/. they might
have in circulation. He regretted that they proposed to
abolish the 30s. notes, which were found most convenient in
the markets of Ireland. By doing so, they would compel
bankers to keep a greater quantity of silver in their
coffers than heretofore, and entail much inconve-
nience upon those in the habit of making their
purchases with these notes. He had been instructed to give
his most strenuous opposition to the measure, and in doing so
he could not but regret that the Irish Members were not in
their places to oppose it. By being in their places they would
be doing their country far greater service than sitting in Con-
ciliation Hall hatching vain empires.—( A laugh.)
Colonel CONOLLY would be glad if some provision were
made for the increase which might occur in the circulation of
Ireland. The circulation of Ireland during the last year in-
creased one million, which was shown by returns which had
been made to the House. This could not be assigned to
any other cause than the general improvement and cultivation
of the country. He was happy to see this in a country in
which it was proverbial that idleness and poverty prevailed to a
great extent. The exports from two of the most important
ports in the north of Ireland had increased to an incredible
extent. The exports from Dublin had also materially in-
creased. Although no one could admire the principle of the
Bill more than he did, yet he thought the restriction very hard
on local banks which had been encouraged by the improvement
in the trade of the country to increase their circulation. He
concluded by expressing his admiration of the principle of the
Bill and with a hope that the Government would make a pro-
vision for increasing the circulation of the banks in proportion
to the improvements in the commerce and with the demands
of the country.
Sir R. PEEL wished he could impress upon the represen-
tatives of Ireland the strong conviction which he entertained
that the measure was intimately connected with the growing
prosperity of Ireland, and that no country on the face o f the earth
would derive more benefit from a sound system of banking and
a staple system of government.—( Hear, T bar.) No country
on the face of the earth had suffered more from a bad system of
banking than Ireland. From his personal experience he was
satisfied that many of the cases of distress which occurred in
the south and west of Ireland arose from the simultaneous
failure of almost all the banks in those parts of the country,
causing individual cases of heartrending distress as well as
general injury to the country. By the failure of these banks
the Irish Exchange has been so greatly affected that in 1804
no less than 50 banks had failed. Since that. year many more
had been established, but these all failing the whole community
had been plunged into general and universal distress. Of
these banks four had been established in Dublin, three in Bed-
fast, and one in Bala. but, these had all failed he believed'
without exception. Of the case of Lord Ffrench's bank he
could say nothing. But there had unquestionably been great
distress about that time, and one of the main causes was the
supposition that inconvertible paper was wealth. It might
have been supposed that the exclusive principle held by the
chief banks of Dublin would have prevented that run on the
provincial banks, but such had not proved to be the case. In
several parts joint-stock banks had been established, and he
believed that on the whole they had been managed with pru-
dence arid ability, but their chief source of safety had been
their acknowledged liability of their notes being convertible
into gold, and the consequence had not been as was supposed
the prevention of this course of rendering them convertible
into gold. The conduct of a certain portion of the joint-
stock banks had been to render the system suspicious, and had
exposed the other banks to a run. And what was the course
of thejoint-stock banks in 1837 There was a bank at that time
called the Agricultural Bank of Irelat d, which had far exceeded
its amount of gold in its issues, and what was the consequence ?
Not only had that bank failed but there had been very wide
and intense distress, indeed never had he seen such a depth of
distress as had been occasioned by the failure of banks at that.
particular period, to the destruction of all confidence, and the-
entire disruption of all ties of property, and an injury to every-
other bank in the country. There was at that time another
bank in Ireland, and he believed there still was, called the Pro-
vincial Bankof Ireland, which was, of the highest respecta-
bility, and had conducted its operations with great skill and sa-
tisfaction to the public. The secretary of that bank had been
examined before a Committee of the House whether, in conse-
qaruiesni
ncge otfo tthhe failure of h e
otherhankts,aat bank,ruihe hthaedre ha
replied
rbe ! en any evil
that
toevery
one it had caused great loss. He was further asked whether
there had been at that time sufficient gold in Ireland to meet,
the requirements of the public at that time, and he replied
that he had not the slightest doubt that at that particular time
muchthe t. e
largerwa s unquestionably,soni o f
specie for theyonhand thhaadn been
they
actuallyobliged
p
from the apprehension of a run, and the sum was increased so
as to greatly exceed the amount of their issues. The necessity
had arisen from no:requirement of unusual business, but solely
from the feverish state of excitement, and the excess was only
wanted to meet that feeling. When asked whether he could
tell whether that gold was in the country or whe-
ther it had been brought from England, he re-
plied that certainly there had been a considerable
quantity in the hands of the bankers in Ireland, but that a
very great portion of it had been brought from England, and
that for the purposes of the run it had all been brought from
England. When asked whether it was brought from Lon-
don, he replied, from London and other places ; a great pate
from London, but some also from Liverpool and Bristol. The
whole of it, he believed, originally came from the Bank of
England, and he thought that not only the Provincial Bank,
but also all the other banks in Ireland, had been compelled
to pursue this course, in consequence of the conduct of the
Agricultural Bank, who, though they professed to meet all
theirissues in gold, had used every expedient to get their notes
into circulation. When asked as to what amount he cancel ved this
increase had been made, he replied, certainly not less than
this2,o t200,,,,aC50n0. i
sln
a nl
lyg gross. And
or w hwehe n t
he
ragi
ta again,
sit a
meet
ee
tt inquiredhe ewxhter
at hoer:
dinary amount of issues, he replied that there was no doubt of
the fact that it was simply for the protection of the banks.
Now was it right that such a sum as 2,000,000/., should
have to be kept for meeting an emergency arising from no
real call, but only to save the inconvenience they could not
controul, and to avoid a disadvantage for which they were in
no way responsible. He thought, therefore, that it would be
no small benefit to the country to give a check on this un-
limited issue. It would also he something to give relief from the
state of painful suspense and excessive anxiety which such a
system must inevitably occasion. The Hon. Member (Col.
Conolly) said that the object of this measure was to reduce the
amount of the circulating medium just at the time when tee
increase of trade and commerce required its expansion, but he
( Sir Robert Peel) thought that this restriction on these issues,
and the obligation to pay in gold, would be to enable the banks
to extend their issues, as they would be freed from those
liabilities to which they were now subject. An increased con-
fidence would pervade the country, and less expense would be
incurred in the obtaining and keeping gold. He had also been
accused of bringing this measure forward prematurely, but he
thought that this charge was, at least, entirely without founda-
tion, for when he brought forward his motions respecting
the banks in England last year, he had distinctly given
notice that. he intended to deal this year with the
banks of Scotland and Ireland, and he thought that
during the interval there had been ample time for considera-
tion of the banks. When he had brought forward that mea-
sure he might with equal justice have included the banks of
the other two countries. exactly twelve weeks before he
had used, his speech introducing that measure, he'had given
notice to the bankers of England of the nature of his intended
project, and no difficulty had been experienced either by the
banks or in the country. He had been told, also, that he had
dealt unfairly with the banks of Scotland arid Ireland, as he
had taken the average of one only thirteen weeks, and the
other twelve months. In his opinion Ireland gained the ad-
vantage; but as there was a -difference, though he himself
thought that the protection would be greatest for Ireland, he
would take the larger suns as the basis of his calculations—
( Hear, hear)—and he would give the average of the twelve
months. In addition to this he would give the privilege of
issuing notes within the prescribed distance of sixty-four miles,
which
based on
ichhad hithesrpteoefiee.rmeßdy thethabt privilegeoundarylt all banks havingne,providedthelssue
was
more than six partners were excluded from not only circulating
notes, but also from having any houses of agency, or conduct-
ing any transactions in their own name in Dublin, where they
would interfere with the notes circulated by the Bank of Ire.