Lynchburg Virginian. [volume] (Lynchburg [Va.]) 1829-185?, 1836-11-17
Ala moment when the public mind is turned t.

the sabj"ci 81 Banking, the following article Will
be- acceptable to many II our readers:
FOREIGN BANKS.
Baak ot EngiaHd.-The largest proportion
born 81 inanl bill, in circulation IN England and
Of foreign bills drawn an Great Britain, being
made pay able IN London, the bank Of Engla
has therefor. been long tho principal bank ol cir
cusiion in Europe. Ii was originally chartered
by parliament in 1904, by virtue OF which III"
British Government obtained an Indispensable re-
liei BY timely loan. Subsequent advances were
similarly made so that the whole loan
mount, to II ,6s6,00O pound, sterling, about
II million, of dollars. This forms the capital OF
the bank, ani has double adyantage--tho faith
of the government being pledged for the whole
capital and the bank giving public security to
that amount: that the whole loan must be 81
crifeed before the holders of lis notes can sustain
any loss But ia by the late act for renewing tue
charter, fourth of hi, capital !, 10 be paid
off, the remainder alone can then form the Whole
capital tot banhing purpo>es-witieh will be 49,
0il,15O pounds sterling, or about % millions OF
dollars. Tie notes Of the bank are now legal
tender every where in Great Britain, except AT
the bank itself It's branches: this prevents the
dram Of specie from lis vaults, while the bank
Ia, thus the power Of controlling the ISSUES OF oh-
cr banks. Her own ISSUES are guided by gene
much com and bullion IN their Golfers rs may
together amuunt--whrn the exchange is at par
10 zone third at the liabilities including dcposltes
with ISSUE; bat they are temporarily increased
during favorable exchange, OF when bullion Is
sent IL hc exchanged Tor notes: aud rice rerSd.
Thus the action oi exchange IS made the control
lag p'ncipie.
In nrdcr to prlsrm nadue competition win the
local banks or private bankers, the bank OF Eng
land commonly leave, discount operations TO them,
by charging a higher rate OF interest and requiring
greater securities: tins prudence prevents also
excess OF circulation, and tluctuaiion of exchange
But should the other banks increase their rate OF
interest discounts, the security of the bank Of
England being greater than theirs, a preference
i, generally gwen to that bank b, those who wish
loans, aud the ate Of interest is checked with
in proper bounds. This bank is the depository Of
the British revenues, and usually makes advances
on Them 10 gUNcrnment,-i winch 1t was pald
a handsome SIim turnerly. But this has been re-
dnced by the late charter, as the bank is permit
ted 10 trade the balance of unpaid dividends
due the government. 1t has the management OF
the national debt, aud of the public pensions and
anbunis.
II never allows interest on dcpo>itcs nor per
nuts deposit accounts to be oyeidrawn. The re-
ncwcd charter is for twenty years. but after the
expiration oi ten, IT'S exclusive privilege may be
repealed giving twelve months notice
The Bank Of Scotland was chartered in 1893.
lis capital Is now 800, 600 pounds sterling one
million OF which has been paid. II is entitled to
the credit OF having introduced and established the
distinctive principles OF the Scotch banking syS-
tenn, by first allowing interest on depositcs, and
granting credit on cash accounts This lasi OBJ
Yates the necessity OF making deposit by giving
a bond IN good security to the amount Of credit
required; and for that amount, he applican, is
entitled to draw IN whatever manner he pleascs.
These credits are not 10 be used dead loans,
for the sake OF interest only them, but are bone
6eia to the bank IN the circulation OF It's notes. and
in the frequent repaymcnts in way east affecting
it, circulation. Deposit accounts may be over
drawn ON paving interest
The BWF ri Ireland was chartered in 1888,
with similar privileges to those Of the bank OF
England. lis present capital. under renewed
charter, Is three millions. Ii neither grants
cash credits, nor allows interest on depo>cs and
ii discounts at 5 per cent.
These three are the only banks in Great Bri-
tam chartered by act OF Parliament. But there
are various banks iccnccd TO issue notes under
/ the provisions OF A general law They amount to
about 600 IN England, 800 in Scotland and i'm
! Ireland. Besides charging interest on discounts
! or oycrIraWn accounts, many OF those licensed
/ banks eli re COMMISSION tor services rendered
! the collection oinotcs the payment of bills, trans
mission 81 money, &C. Maay of them allow re-
dnced interest on deposits bat the failures OF
banks Occurring so frequently, lew are willing to
enlrust them wllh deposits Their nominal capt
/ tai Is generally twice or lhr that paid up and
| the provincial banks formerly labofcd under re-
! strcuons as to drawing bills on London and the
number OF partners. But Is these are greatly olivia
ted by the act renewing the charter OF the bank OF
England, the utility and stability of the other
banks may ho promoted although so many Joint
stock bdnhlns companies have lately been tor med
IN consequence, and without the necessary secu-
rty Tor the public that the ndition OF most Eng
ll,h banks IS now rather experimental. The more
prudent oil the English political economists endea-
'ored to nave general act passed, requiring the
Shareholders IN such banks to give security to
government Tor all their issues. it is believed that
secnrily Tor shares is Insufficient to secure public
confidence. Net IA shadow of doubt is cast on the
sol,cncy OF the Scotch banks for their >harehold-
ers are individually subjected to an unlimited
responsibility for all liabilities of the banks, and
the law OF Scotland affords every facility for
sttachInsa debtors property in lands or movea-
hles, and making II available for the payment of
his debts. Such a law has always sautary eff
feet.
There are various private bankers who do not
i>sae notes, but tade on discounts bills &c
The Bank Of Venice was the FIST banking cs-
adjustment III Europe. 1t was founded in M
ard was continued till the fall Of the republic in
! l'9I. II was essentially ii deposit bank and
| lis DlIlS bore at all tunes "A premium or dgio over
! the current money OF the CITY.
Il. L.