, 1889-03-13

cent, and in many cases to four, while the
usual commission of 5 per cent for purchas.
ing for Money from date of invoices, has
fallen IN most liues of business, to 5 aud
q per cent.
In the Canadian. Australian and Afri.
"an Colonies, the rate of discount does not
exceed 6 per cent, and in all these Colo.
MES, the banks have very largely assisted
the development OF the colonial trade and
agriculture, by very liberal advances on.
landed property, and great facilities given
to merchants in the way of discount and
Accommodation. -
In these days of severe competition, few
businesses eau afford to pay 8 per cent, for
discount, aud 8 per cent for advances On
open account. The consequence is that if
a merchant can arrange with his London
or New York agents to extend hiS credit
ut q per cent. or 5 per cent, he will avoid
business with the bank. III this way the
tfotonlal Bank loses u great deal Of the
best and safest business of the West
India Colonies, and We can quite under.
stand that their funds accumulate in> Lon.
don and that the amount OF discounts
should decrease.
The remedy for the state OF things com.
planned of by the Chairman Of she Bank
Directors, il u reduction of the rate of
discount to 3 per cent. and the adoption
OF u reasonable system of al vanceS for
agricultural purposes, similar to the me-.
thOdS that have so wonderfully assisted
Ia the development Of the Industries of
CeyIOn. we DO not suppose, for u mo-
ment, that the Colonial Bank, which the
Chairman admits to be an old.t&shiOned
aud conservative Bank, would make such Ii,
oeral advances to planters as the. ARTicul.
tural Banks OF CeylOn But, with diS0re.
ton and prudence, and consequent safety,
the ColOninl Bank could very largely in.
crease its business, in this direction, and
thus add to Its own prosperity aud cOnteC
a considerable benefit on tue West Indies.
In Jamaica, perhaps, more particularly 10
the system of agricultural banking requi.
red, and if the Colonial Bank would take
up this line of business, there would DO
no more complaints of capital lying idle in
London, We do not, for q moment, advo.
cate any reckless extension of aCcOmmoda.
tlOu but the acceptance of securities
against loans, OF u different character to
Ell lorSements on Bills. We feel quite
sure ourselves that the money of the 90.
Ionlal Bank would be quite as secure, IL
advanced under proper restrictions, TO
assist planters to properly cultivate their
AND and extend the production thereof,
as 1t Is on acceptances secured only by one
vi TWO endorsements or people, whose
actual possessions may, after oil, consist
simply in the credit afforded 10y some TO.
reign merchant. Some amount of risk ia
absolutely unavoidable in ell commercial
transactions, and a Bank, like a private
firm, has to depend OH the honor aud ex.
lsting reputation of it's clients, az. much
as ou the security afforded by the un-
doubted possession Of capital or property,
We would, while on the subject, like to
say a word on the subject of premiums ON
Bills of Exchange. No merchant will for.
felt the convenience and the security of
Bank Bills ii he can obtain them at the
market value; but in these days most inen'
are compelled to watch, their expenditure.
closely, and if they can see u small ;&dvan..
tage in shipping specie or purchasing pri:
vate drafts, o high Bank premium will
sssurcdly drive them to adopt th~eSe'Flatter
courses in preference to purchasing Ban.
ker's drafts. ..., -+fl ,s;sa0
A premium of l per cent on a 80 day
paper, is too high for the times, aud the
Bank would do . better and larger bust.
ness if it would reduce its rates 0tt prenis
um to half per cent, which would afford
. handsome profit, since the exchange
business generally. is made to balance on
the selling and buying accounts,and THUS
there is no employment. of capital and. the
earnings on this account are made entirely
by the credit and standing of the Bank.
10 hills a,o houOhf I'm q 0roofnr io<fouk