The herald., 1896-02-02
RUSS|ES IMPERIAL BANK
Affords the Empire a Stable
System of Finance
IMPROBABLE GOLD RESERVE
4 Monopoly That Enjoys the Popular
Confidence
Peasants Are the Principal Depositors-Ably
and Probably Conductsd-The Men
Who Govern IL

The agitation in financial circles in
this country and Europe, caused by
the rumors of war bstwesn England
and the United st ties, disclosed, per-
haps, what was intended to be state
yecret, that the Russian government
had some years ago made the generous
offer OF large gold loan to this coun-
try. ana had recently renewed the offer.
Russia aud Russian finances are lit
tie known in this country, and nation
that generously offers to loan $6O000,-
900 in gold and still has some $780,
100000 left in her treasury, is worth
becoming better acquainted with. The
government institution from which
this gold would have been drawn, cup
posing the United 8 tates government
had accepted tie loan, would have been
the Imperial bank OF Russia.
By an imperial decree of 1889, still in
force, silver was abolished ''as ths
legal and unalterable unit of the
money current in the empire" The
Russian national debt is enormous,
and the exact figures are not publicly
known, but the interest is promptly
paid. aud Russis's credit is good.
In 1874 the Russian government CON-
menced the accumulation of metal,
when 100000 rubles we're deposited
in the St. Petersburg citadel and 12,-
000,000 more we're added in less than a
year. This forming a reserve fund
nearly half as large as the amount in
circulation raised the value of the cur
rency, and when, little later, Empe-
ror Nicholas ordered 100000000 rubles
government money to be invested in
foreign stock hnanciers thought them
selves justified in considering the
printed currency OF Russia tantamount
to coin. In 1860 the government es-
tablished the present imperial bank
and conferred upon it extensive pow
ers with view to a reform of the mon
etary issues and revival of commerce
and productive growth. Two years
later, in 1862, M. Eugene Lamanski,
the director, an able economist and an
accomplished banker, published re-
port on the causes of the disorganiza-
tion OF the machinery OF credit in R1s-
eia and on the best means of financial
reform. He showed that one principal
cause of mischief was the instability of
the monetary circulation, and declared
that so long as the state maintains a
forced currency the paper money can
have but little stability of value, but
that il Russia would forever renouncs
the policy of using the ISSUE OF paper
money as a financial reserve all might
be remedied. This suggestion was ap-
proved by the emperor, aud his sue
cessor on the throne continued the
20 icy.
To the present able minister of
finance, NJ. De Witte, and the governor
OF the Imperial bank, M. Pleske, the
improved condition of Russian finances
ars to great extent due. The Journal
de st. Petersburg, one of the official
newspapers Of Russia, and printed in
the French language, published on the
1st OF December q report of the Impe-
rial bank and its nine general Offices
throughout the empire, which shows
the enormous amount OF business
passing through the state bank.
Report OF tbs Imperial State hank of
Russia, Dec l, 1895:
ACTIVE
Redeemable treasury notes .... 67l, ,2Sl .634
TEN porAry treasury notes. guar
rntced by an mperial ukase of
July .s. s9I.................... $1,000, 900
Total. ..............l, 12l, 2S1 ,634
PASSIVE
Francs
Treasury notef in circulation. ... /, ,O46, 251 634
Temporary treasury n oes, guar
anieed by ar imperial ukase OF
July 2s 1891. 1.......... ....... $4,000 900
Total ................... .... l, III ,2S1, ,634
The bank is powerful instrume ment
OF administrative finance. Like the
IL 4
bank had for it's primary purpose the
function of helping the operations of
government finance, but, unlike those
celebrated institutions, the Russian
bank was founded on capital advanced
wholly by the government. Its board
OF directors are committee of the ra-
tional treasury, its profits pass directly
into the Golfers of the government, and
its management is carried on wholly
by government officials. If the offices
of our treasury in Washington, New
York, Boston and other cities we're to
receive deposits and to make loans in
addition to their present functions our
independent treasury system would
very closely resemble the system i'm
posed by law upon the Imperial bank
of Russia.
Beside the state bank Russia has
several hundred commercial banks
which somewhat resemble our state
banks, and st. Petersburg, Moscow,
khsrkow, Kew. Riga, Volga Kama,
Warsaw and Odessa have several joint
stock banks each. The bank law of
Russia is said to be very stringent in
it's limitations in the amount of ad-
vances. The nature of the securities
TO be taken. the publication of ac-
counts and the like, and the failure of
a banking institution is the cause of a
most stringent inquiry by The govern
ment, and severe punishment is meted
out to all defaulters, as in the case of
DIR. Strasberg, who, as one of the de-
positors in the Moscow Commerce
and Loan bank, was convicted of
wrecking this institution in 1875 and
was barisbed for life from Russia.
The fnancial system of Russia offers
not few points of similarity to our
own. 1t is more than century since
the issue of the Russian paper money
was begun. Previously the trade of
the country was In a very undeveloped
condition, and the exchanges were
carried on by means of copper circu-
lation. The heavy copper copecks
previously in use were so inconvenient
that the paper currency soon became
quite popular.
The system of popular banks in
Russia is comparatively recent irtro-