The San Francisco call., 1905-06-11
ORIGIN OF GREAT
INSTITUTIONS
Design of Bank of England
Conceived in Year 1861
by One William Paterson
RENEW CHARTER OFTEN
First Was for Eleven Years.
Six Millions Of Capital.
Business Done in One Room

Considering the worldwide reputation
of the Bank of England, it is remarkable
how little is generally known as to it's
internal workings. Standing in the very
heart of the largest city in the world
central landmark of the great metropo-
lis-eyen the busy Londoners around 1t
have. as a rule. only the vaguest possible
knowledge of what goes on within its
walls. In truth, its functions are so
many, its staff SO enormous and their du-
ties so varied that many even Of those
who have spent their lives in its service
will tell you that beyond their own imme-
diate departments they know but little of
it's inner life.
The Bank of England originated in the
brain of William Paterson, a Scotchman-
better known perhaps as the organizer
and leader of the ill-fated Darien expe-
dition. 1t commenced business In 1894. its
charter-which was in the first instance
date July q of that year This charter
has been from time to time renewed. the
last renewal having taken place in 1s44
The original capital of the bank was
but $6,000,e00, and 1t carried on its BUSH
ness in a single room in Mercer's Hall,
with a staff of fifty-four clerks. From so
small beginning has grown the present
nearly three acres.
BIG NOTE ISSUES.
In the banking department Is transacted
the ordinary business of bankers. Here
other banks keep their reserve" hence
draw their supplies as they require them.
The issue department is intrusted with
the circulation of the notes Of the bank.
which is regulated as follows: The bank
in 1874 was a creditor of the Government
TO the extent of $55, 900. and to this
amount and $40. 900 beyond. for which
there Is in other ways suff1cient secu-
rity, the bank is allowed to issue notes
without having any gold reserve to meet
them Beyond these SIS 200. 900 every note
issued represents gold actually in the cof-
fers of the bank.
All Bank of England notes are printed
in the bank itself. Six printing presses
are IN constant operation. the same ma
chine printing first the particulars OF
value signature, etc. and then the NUM-
ber of the note in consecutive order Ine
paper used is of peculiar texture, being
at once thin, tough and crisp, and the
combination of these qualities. together
with the peculiarities of the water-mark'
which is distributed over the whole sur
face of the paper, forms one OF the prin-
cipal guarantees against imitation. The
paper. which is manufactured exclusively
at one particular Mill, Is Indoo III op'oio
slips, allowing just enough space for the
printing of two notes side by side.
NOTES NEVER REISSUED.
No note is ever issued a second time.
When once it finds its way back to the
bank to be exchanged for coin II Is I'M
mediately Cancelled, and the reader VIII
probably be surprised to hear that the
average life of bank note, or the time
during which 1t is In actual circulation,
is not more than five or six days. The
returned notes are brought into what
is known as the accountants sorting Of
flee. Here they are examined by inspect
ors. who reject any which may be found
TO be counterfeit. In such case the
navinc-in bank Is debited with the
amount.
The notes come in from various banks
in parcels, each parcel accompanied by
memorandum stating the number and
amount of the notes contained tn 1t. The
memorandum is marked with certain
number and then each note in the parcel
is stamped to correspond, the stamping
machine automatically registering now
many are stamped and consequently
drawing attention to any deficiency IN
the number of notes as compared with
that stated in the memorandum.
This done. the notes are sorted accord
ing to number and date, and after being
defaced by punching out the letters indi-
eating value and tearing or the corner
bearing the signature, are passed to the
hank note library, where they are packed
in boxes and preserved for possible luture
reference during period OF five years.