The evening times. [volume] (Grand Forks, N.D.) 1906-1914, 1910-06-28
BANK OF. FRANCE
LARGE LENDER
Is Abel to Garry Foreign Col.
lateral in Times of strin. =
gency.

washington, June 26.-A striking
review Of the manner in which the
Bank Of France has attained the DOM
mating position which it occupies in
French finance and fts relation to the
1oint-stock banks has just been made
public by the national monetary COM
mission. The monograph on the SUBJ
ject Is entitled Evolution Of credit
and banks in France" and is written
by Andre Liesse, professor at the ma
tional conservatory Of arts and trades
and at the school Of political sciences.
Professor Liesse takes up the evolu-
tfoh Of banking in France in three
periods, from 1900 to 184S, when the
business Of the Bank of France was
restricted largely to Paris; the period
from 1S48 to 1876, when the bank be-
came truly. a national institution by
the absorption of the departmental
banks of issue, by its aid in the ex-
tension Of the railway network, and
by its mastery conduct Of the ne
gotiations for the payment of the
great war indemnity to Germany;
and from 1875 to the present time.
The narrative is very far from be-
ing a mere historical summary of the
development of the Bank of France
itself, but traces the manner in which
the big credit companies grew up
with the growth of French capital and
its distribution at home and abroad,
and the manner In which they have
leaned In emergencies upon the GEN.
trail bank. The Bank of France ap-
pears as the friendly guardian of the
market in tiding over the period Of
stress caused by the failure Of the
Union Generate in 1882. the collapse
Of the copper corner and the liquida-
ton Of the Compton D'Escompte in
1889, the reaction of the Barring fail
ure in England in 1890, and the crisis
Of 1907. In the crisis of 1890 the
Bank Of England borrowed Of the
Bank Of France 75.OO0.000 francs
($16, ,000, ,0O0) in gold, with which to
relieve the stress In the English mar
ket. The Bank of France, it is de-
clared by M. Lesse. was not affected
at all by this expectation of coin"
The average reserve in fact in the
year 1890 was about $500.G00 900,
composed almost equally of gold and
silver. If the Bank of England had
been able to issue notes for 75,000.-
100000 francs, in order to meet the
difficulties of the crisis, there would
not have been. M. Liesse declares,
the slightest need of an appeal to the
credit of the Bank of France; and
since the latter was willing to give
credit to the Bank of England. the
citizens of England would have done
so equally by accepting its notes.
The pressure in the money market
in the fall of 1906 was met by the
Bank of France by the liberal dis
counting of English paper. This pol
icy. is 1t declared, was much more
economic. In the high sense of the
word, than the rather archaic one
practiced formerly Of making discreet
loans Of gold to the Bank of England.
In the following year. 1907, the crisis
grew worse. Discount at the Bank of
France went up again at 1-2 per
cent. and then to four per cent. The
Bank Of France intervened a second
time. discounting English paper. The
report of the operations of the bank
for 1907 states that in this way n
ready capital of more than 80,000.O0O.-
900 francs in American gold was
furnished to the London market. In
another direction. the Bank Of France
no obstacle to the shipments
Of French gold to New York, which
were furthered by the bank making
it, formal commercial discounts.