The New Orleans bulletin. [volume] (New Orleans [La.]) 1874-1876, 1874-12-11
The German National Bank Scheme.

The London Times gives the following sum-
mary Of the government scheme of an i'm
peral bank, which has met with so much
opposition in the German diet
The effect of the government bill, if it be-
comes a law, would be to keep existing note
circulations as they are, or, at all events, to
modify them only by circulating their amount.
It proposes that no new bank OF issue shall
be established, and that no extension shall be
permitted of the issues that are now au-
thorized. It proposes to enact also that no
bank of issue shall accept bills OF deal in
stocks, shares or merchandise, and that GER
tain monthly and annual accounts shall be
published by them /; but these clauses do little
more than reproduce regulations already
familiar. One change is indeed suggested
but it is not a change of principle, and is
sure to be stoutly opposed, and though it is
apparently devised in imitation OF our own
law, we cannot say we think it we'll advised
It is proposed that in future notes shall be
issued only for 100 marks (e5) and multiplies
of 100 marks, the notes now i'll circulation
being as low as 10 thalers (30s), if not lower.
We need not dwell on detail which could be
easily cut out of the bill, and We pass at once
to its most important provisions. 1t is sug-
gested that an account shall be taken of the
average issue of each issuing bank during the
three yerrs preceding the late war, and that a
nominal sum of 100000 of marks (e15,-
0OO, OOO) shall be distributed among these
banks in proportion to the average issues thus
ascertained. We are without exact informa-
ton as to the total note circulation OF the
States of the Empire before the war, but we
believe it did not differ much from this sum
Of els, 900, 600; SO that the Hypothetical sum
distributed among the banks would CORES
pond very closely with the amount each &C
tually had in circulation. The magnitude of
this hypothetical sum, would, however, be
henceforth an important fact in the position
of each bank.
No bank in England would deem it worth
while to issue notes upon the condition of
paying tax Of 5 per cent on the amount in
circulation, nor is the current rate of interest
in Germany high enough to make it profitable
there; and the probable effect of the law, if it
were passed, would, therefore, be to reduce
the minimum circulation of each bank to its
allotted share of the hypothetical els, 600, 900.
Tie result would be that the total note circu-
lation of the empire would be about fifteen
millions, distributed among existing banks in
the proportion of their average issues before
1870, subject to a payment OF l per cent per
annum on the excess of notes in circulation
over the cash kept on hand. The diversity of
issues in different parts of the empire would
remain untouched, and, as if to prevent pro-
vincial notes from passing into general circu-
lation, it is proposed, by a clause which the
Scotch and London bankers will appreciate,
that no bank having a right Of issue in one
State OF the Empire shall be allowed to set up
a branch OF an agency, or transact business in
any other State, except under conditions so
OnerOus that thew NAV be disregarded.