Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-12-21
THE BANK OF ENGLAND
Close Relations With the Gov
eminent Maintained.
NEW GOVERNOR EACH YEAR
Great Demand for the Position of
Clerk.
SMALL SALARIES ARE PAID
Employees Retired on Full Pay on
Reaching the Age of Sixty.
Forgery Of the Notes.
SMALL SALARIES ARE PAID
BY WILLIAM E. CURTIS.

Written for The Star and the Chicago Record.
Herald.
The Bank of England, which am asked
by Mr.. T. c. Thorpe of Angus, Iowa, to de-
scribe, does a general banking business,
and theoretically is not a government insti-
tuition, although 1t holds a charter from
parliament allowing exclusive privileges.
and practically its relations with the gov
eminent are quite as close as those of
the United States Treasury to our gov
eminent. 1t is Familiarity called THE
Old Lady of Threadneedle Street" and is
one of the most interesting institutions
IN the world. 1t handles all the govern
ment's money, is the depository for all
the revenues of the kingdom, and paws
all the expenses of the government upon
orders from the exchequer. 1t manages
the PUBLIC debt of Great Britain and PAYS
the interest upon the bonds. For this
service the bank receives a commission
OF about 100000 year and enioys a
monopoly.
Before the foundation of the Rank of
England the merchants of London were
~, ~ the haDit OF depositing their cash bull
lion and other articles of value IN tha
rover. under the protection of the king
IN 1910. however, King Charles /. being
IN IN great straits for money because of his
h ta.ai oissoiution of parliament before it
nao voted the annual supplies for the
government, confiscated the deposits. The
merchants were bankrupt: thew had NO
money to pay their bills or to transact
.nesr business. and after prolonged ne
EQUATIONS they jointly agreed to let the
king have 10000 upon receiving adeonate
security, and he returned the vaIuabIes
ne mad confiscated. The whole of the Ioa
was Ultimately repaid with interest. but
t an m IN the royal honor was gone:
saIe depository. and the merchants kent
tnelr surplus funds in their own houses
nidoen away in secret places or stored In
IRON pound chests that were kept con-
SANITY under guard.
Then the goldsmiths becamo ao,..,
tories Tor bullion, upon which thew is.
sueo notes and their customers uera
auo~ed 10 draw upon them to meet
,nelr pins. In that way banking in Eng
and began. and the goldsmiths of Lon
don were the first persons in that countrv To
be called bankers. They acted as individ.
uals. however, and although several
schemes for joint stock banks similar to
the Bank of Venice and the Bank of St
George in Genoa were proposed Under
the government Of Cromwell, it was not
until 1894, In the reign of William and
mary: that the act was passed incorporate
Ing the Bank of England
Establishment Of the Bank.
Ihls bank was proposed and the act
was secured by William Paterson, a
Scotchman from Dumfriesshire, who
afterward attained an odious reputatto
because OF the failure of a wild specu-
iation to settle a colony to be called New
Caledonia" upon the Isthmus of Pana-
ma Four years after he had founded the
bank Paterson sailed, with 1000 man
coionists. and was afterward Joined by
l.60O more. who, after terrible sufferings
persisted from disease or were murdered
by the Spaniards and the natives. Few
OF them ever reached home. Paterson
became insane and Is said to have COM
United suicide. He was never governor
Of the bank and was a member of the
board Of directors for only one year.
The organization Of the bank and its
early development Is due to Mr.. Michael
Godfrey. an East India merchant; Charles
Montagu, Earl Of Halifax, who was chan
cellor OF the exchecquer under William
and Mary, and Sir John Houblon, gold
smith. The bank now stands upon the
site of the latter's house and garden
Godfrey was the first deputy governor
He wrote and issued the first advertise
ment explaining the purpose and plan
of the institution. and asserted that those
would have it much more safe and quite
as much at their disposal as il 1t were
in the hands of a goldsmith or in their
own chests. He had attacked the honesty
| OF the ROiQSIH1t0S anu utCiei GU IL
the money which had been lodged with
them for four or five years had been
lodged with the bank it would have pre-
vented it from being so scandalously
clipped" He predicted that TINS clip
ping of the coins of their customers by
the goldsmiths would cost the nation a
million and half or two million pounds.
Michael Godfrey was shot July IL: 1888.
little more than six months after the
opening of the bank. at the siege OF
Namur' Belgium, where he had gone to
make a report to King William concern
corning its operations. The king was then
hesieeing the French, who occupied that
place.
ORGANIZATION Of the Bank.
The Rank of England was whig
project and has always been an object OF
great interest to the wing party. Although
II is now entirely out of politics. 1t was
| the object of attack by the tories for two
centuries.
The charter was given ny Parliament to
| q CORPORATION to be called THE Governor
and Company of the Bank of England
and It continues to carry that official title
| unto this day The condition under which
| II was granted was that the stockholders
should make a voluntary loan of $6,OOO,OOC
| to the government for the purpose of car
| rying on the war with the French, which
sum was to be repaid IN instruments Oh
/
| monopoly right to issue notes for as much
money as 1t advanced to the government
and the government guaranteed the pay
ment of the notes. The charter has been
amended on several occasions, but in prin-
cipal remains the same, and although II
Is the sole financial agent Of the govern
ment. and handles all of the government
money, the board of governors has never
been composed OF politicians. and for gen
| erations political influence has been inef
fective in their selection.
| The original stock of the bank was
81, 200. eco, which has since been increased
from time to time until 1t is now f14. $50 .
600 and Il Is very widely distributed
throughout the kingdom. The private de
posits are about 500, 0OOO; the govern
ment deposits average 100000; TIT
loans and discounts average $3.50 600 600.
Directors and Officers.
Directors are elected annually, al
stockholders having the right to vote
Quakers and Hebrews are not eligible ant
a director must be the owner of SO 90,
in stock. They are paid salaries of $2.5Ot
each The directors elect annually gov
ernor, who must own $4,000 in stock, q
deputy governor, who must own $4,000
1.-The deputy governor Is permanent Of