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tions of his employers, and giving Aberdeen, and Glasgow, stated, security to them for his conduct. that more than one-half of the

The Bank of Scotland had, at deposits in the banks with which the date of the last return received he had been connected, were in by your committee, sixteen branch- sums from ten pounds to two hunes, established at various periods dred pounds. between the years 1774 and the Being asked what class of the present. The British Linen Com- community it is that makes the pany had twenty-seven branches. small deposits, he

gave the followThé Commercial Banking Com- ing answer, from which it appears pany in Edinburgh, thirty-one. that the mode of conducting this The total number of branches es- branch of the banking business in tablished in various parts of Scot- Scotland has long given to that land, from the southern border to country many of the benefits deThurso, the most northerly point rivable from the establishment of at which a branch bank exists, is Saving Banks. one hundred and thirty-three.

“ What class of the comSpeaking generally, the business munity is it that makes the smallof a Scotch Bank consists chiefly est deposits?” in the receipt and charge of sums A.-" They are generally the deposited with the bank, on which labouring classes in towns like an interest is allowed, and in the Glasgow. In country places, like issue of promissory notes upon the Perth and Aberdeen, it is from discount of bills, and upon advan- servants and fishermen, and just ces of money made by the Bank that class of the community, who upon what is called a cash credit. save from their earnings, in mere

The interest allowed by a bank trifles, small sums, till they come. upon deposits varies from time to to be a bank deposit. There is time, aceording to the current rate now a facility for their placing of interest which money generally money in the provident Banks, bears. At present the interest al., which receive money till the delowed upon deposits is four per cent. posit amounts to ten pounds.

It has been calculated that the When it comes to ten pounds it is aggregate amount of the sums de- equal to the minimum of a bank posited with the Scotch banks deposit. The system of banking amounts to about twenty or twenty- in Scotland is just an extension of one millions. The precise accuracy the provident bank system. Halfof such an estimate cannot of yearly or yearly those depositors course be relied on. The witness come to the bank and add the by whom it was made, thought savings of their labour, with the that the amount of deposits could interest that has accrued upon the not be less than sixteen millions, deposits from the previous, half nor exceed twenty-five millions, year or year, to the principal ; and and took an intermediate sum as in this way it goes on without the probable amount.

being at all reduced, accumulating Another witness, who had been till the depositor is able either to connected for many years with buy or build a house, when it different banks in Scotland, and comes to be one, or two, or three has had experience of their con- hundred pounds, or till he is able cerns at Stirling, Edinburgh, Perth, to commence business as a master

on the

in the line in which he has hitherto The banks were informed that been a servant. A great part of this communication would be conthe depositors of the bank are of sidered by the chairman as one that description, and a great part entirely of a confidential nature ; of the most thriving of our farmers that he would make no disclosure and manufacturers have arisen from of the amount of the issues of any such beginnings."

single bank; but collect from the On sums 'advanced by the banks returns the general result, and preon the discount of bills of exchange, sent that result to the

e committee. and upon cash credits, an interest An answer has been received to of five per cent is at present this communication from all the charged.

banks in Scotland, with one excep"A cash credit is an undertaking tion. Some of the banks that have

part of the Bank to advance made returns have not been able to an individual such sums of to distinguish the notes under and. money as he may from time to above five pounds; where that distime require, not exceeding, in the tinction has not been made, the whole, a certain definite amount, proportions have been estimated by the individual to whom the credit à computation framed upon the is given entering into a bond with proportions that appear in the resecurities, generally two in num- turns of those banks which were ber, for the repayment on demand enabled to distinguish their notes of the sums actually advanced, below five pounds from those with interest upon each issue from above that sum, and the result is the day on which it is made. stated in red ink.

Cash credits are rarely given Three of the banks from which for sums below one

hundred returns have been received haye i pounds; they generally range from omitted to state the amount of two to five hundred pounds, some- their present circulation. That cir-, times reaching thousand culation has been taken, in the subpounds, and occasionally a larger joined general estimate, on an

average between the highest and The Bank allows the party have the lowest amount of the aggre-i ing the cash credit to liquidate any gate circulation of those banks portion of his debt to the Bank, at respectively during 1825. any time that may suit his 'conve- Subject to the foregoing explanience, and reserves to itself the nation, the following is the general, power of cancelling, whenever it account deduced from the return, shall think fit, the credit granted. made by each bank, of the paper

With the view of ascertaining circulation of Scotland at the the total amount of the paper cur- different periods referred to in that rency of Scotland at different account: periods, and of estimating the varia- An Account of the Amount of tions in its amount, a letter was Bankers' Notes circulating in addressed by the chairman of the Scotland, showing the Highest committee to each bank in Scot- and Lowest Amount in the land, requesting information as to Years 1815, 1821, 1823, 1824, the amount of notes issued below and 1825; and also of the and above five pounds, and out- Amount in Circulation at the standing at certain given periods. latest Period in 1826 to which



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the Account can be made up: total, 280,0871. Probable amount distinguishing the amount of at present in circulation-5l. and Notes under 51. from those of upwards, 1,229,838l. ; under 5l. 51. and upwards.

2,079,2441. ; total, 3,309,0821. 1815. Highest amount--51. Two of the banking companies and upwards, 1,365,9981. ; under in Scotland have made no return 51. 2,185,4981. ; total, 3,551,4961. whatever. Lowest amount-51. and upwards, It will be seen from the above 908,3061.; under 5l. 1,868,324l. ; return, that the present amount of total, 2,776,6301.

the paper currency of Scotland, 1821. - Highest amount_51. being in fact (with the exception and upwards, 1,309,535l. ; under of silver) nearly the whole cur5l. 1,935,224l. ; total, 3,244,7591. rency of ihat country, is computed Lowest amount-51. and upwards, to be 3,309,0001., of which 963,143l.; under 51. 1,597,3021.; 2,079,0001. are in notes below total, 2,560,4451.

51. 1823. Highest amount-51. It has been calculated by Dr. and upwards, 1,396,3901. ; under Adam Smith, that the amount of 5l. 2,065,622l. ; total, 3,462,012. gold and silver coin current in Lowest amount-5l. and upwards, Scotland before the Union, and 1,006,6051.; under 5l. 1,706,6311.; then constituting nearly the whole total, 2,713,2361.

circulation of the country, was 1824. - Highest amount--51. about one million sterling. He and upwards, 1,701,1961. ; under observes that the amount of silver 51. 2,296,4921. ; total, 3,997,6881. coin brought into the Bank of Lowest amount--51. and upwards, Scotland for the purpose of being 1,095,1901.; under 5l. 1,764,825l.; recoined immediately after the total, 2,860,0151.

Union, was four hundred and 1825.- Highest amount_51. eleven thousand pounds sterling on and upwards, 1,946,721l. ; under and that it appears from the ancient 5l. 2,736,491l. ; total, 4,683,312. records of the Mint in Scotland Lowest amount-51. and upwards, that the value of the gold annually, : 1,323,451l.; under 5l. 2,110,648l.; coined somewhat exceeded the total, 3,434,0991.

annual coinage of the silver. Hei: Amount of notes at present in calculates, therefore, the total circulation. Amount of banks amount of gold and silver in cirwhich have made the return-51. culation about the year 1707, at ! and upwards, 1,125,743l. ; under

one million. 51. 1,903,2521.; total, 3,028,9951. The same authority, speaking of: Three of the banks who have made the year 1775, estimates the whole returns have omitted to state the circulation of Scotland at that time amount of their present circulation to be about two millions—"of The amount of their aggregate which,” he observes, “ that part circulation during 1825 was, at the which consists in gold and silver highest, 311,6461., at the lowest, most probably does not amount to 248,4411.; the average of these two half a million.” sums is therefore taken as the prob- Your committee trust that they able amount of their present have not improperly outstepped the circulation 51. and upwards, limits of their duty, in submitting 104,095l. ; under 5l. 175,9921. ; to the House this brief review of



the laws by which the business of with equal justice to the inhabi-
banking in Scotland is regulated, tants of the two countries--whe-
- and of the mode in which it is at ther the stability of the present

present conducted; it is a subject system of paper currency in Scot-
not adverted to in the reports of land can be ensured, if coin be not
previous committees, and it ap- in circulation as its basiswhether

peared therefore to your committee, that system can co-exist with a 1 that it might be convenient to pre- metallic currency in England,

fix a general account of the banks without deranging the currency of ling establishments and currency of this country, are the important

Scotland to their observations on considerations which must be ma" that important question, which was turely weighed before a final de

the more immediate object of the cision can be satisfactorily proi/reference made to your committee. nounced.

They consider that question in The presumption, on general substance to be, whether Scotland principles, appears to your comshall be permitted to retain the mittee to be in favour of an exten

privilege which she has hitherto sion to other parts of the United whad, of maintaining a paper circula- Kingdom of the rule which it has Istion for sums between twenty been determined to apply to Eng

shillings and five pounds; or land. Provision would thus be 220 whether she shall be required at made for equally apportioning 10 some period, to be now ascertained among all parts of the empire that

by law, to provide, in the same charge which is inseparable in the 1: manner in which England has first instance from the substitution iv been called upon to provide, a of a metallic in the room of a paper su metallic currency?


The wider the field - too's en Although the promissory notesis- over which a metallic circulation

pysued in Scotland are convertible into is spread, the greater will be the w gold at the will of the holder, yet security against its disturbance 11: it appears to your committee to be from the operation of internal or

proved by experience, that the per- external causes, and the lighter on is mission to issue notes of an amount any particular part will be the J"sufficiently low to perform the pressure incidental to a sudden 1.100 office of coin will practically ex- contraction of currency.

The alui elude that coin from circulation, business of banking, and probably

notwithstanding that such notes of all other commercial transactions hit may be payable at the will of the connected with it, would be con

holder : and it must be assumed, ducted on a more equal footing, in

that under the operation of the law respect to profit, under a system of {"; •now, applicable to the two coun- currency common to all parts of ? 1:tries respectively, England, will, the empire, than under one which 1; after the year 1829, have a metal- should confine to particular por

lic circulation for the payment of tions of it the privilege of issuing all sums below five pounds, and a certain description of paper. In Scotland a circulation of paper proportion as the offence of coining alone, for all payments of not less shall be found to be more difficult than twenty shillings.

of execution, and to be less freWhether this state of things can quently committed than the offence be allowed to exist, consistently, of forgery, in that degree, upon

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moral considerations, will a metallic The witnesses examined by your circulation be preferable to one of committee, with reference to the paper.

state of the circulation in ScotThese appear to your committee land, were seven gentlemen standto be the principal reasons in ing in various relations to some of favour of extending to Scotland the banks in Scotland :a system of currency which the Mr. Kirkman Finlay, a merlegislature has resolved to re-esta- chant at Glasgow; Mr. Gibson blish in England, reasons which Craig, a writer to the signet in seem decisive in favour of such an Edinburgh ; Mr. Hadden, a maextension, unless they can be coun- nufacturer in Aberdeen; Lieut. tervailed by the proof of some col. Campbell, factor to the duke peculiar circumstances in the con- of Argyle; Mr. Gladstone, a memdition of Scotland, justifying a ber of the house ; Mr. Moss, a special exception in her behalf, banker of Liverpool; and Mr. ånd by a strong presumption that Birkbeck, a banker in the Westsuch an exception can be admitted Riding of Yorkshire; were exawithout prejudice to the interests mined as to the manner of conof other parts of the empire. ducting the business of banking

The main object of the witnesses and commercial transactions confrom Scotland, who were examined nected with it, in Lancashire. Mr. before your committee, has been Gladstone was also enabled to give to prove the claim of Scotland to evidence upon some points relating this exception. Their opinion, with to the circulation and commerce of very slight shades of difference, is Scotland. decidedly adverse to any change in Three of the directors of the the laws which have so long re- Bank of England gave their evigulated the issue of promissory dence, chiefly as to the bearing notes in that country. In estimata which a paper circulation in Scoting, however, the weight due to land might have upon the interests their opinions as authority, it ought of the Bank of England, after the to be borne in mind that a great re-establishment of a metallic curpart of the witnesses from Scotland rency in this country: were gentlemen immediately con- The grounds relied upon by the nected with some of the banks in witnesses from Scotland to prove that country, subject, therefore, to that it is neither necessary nor the prepossessions which naturally expedient to alter the laws which spring from a long connexion with permit the issue of small notes in existing establishments, and from that country, appear to be the fola warm interest in the continuance lowing: of their prosperity:

That these laws, so far as they It is not improbable that, had relate to notes between the sum of the time permitted it, your com- 20s. and 5l. payable on demand, mittee would have extended still have remained unaltered since the further their inquiries ; and they first institution of banking in Scotdeem it on that account the more land. incumbent upon them to state the That, coincident with the pregeneral nature of the testimony sent system of currency, if not imupon which they have come to 'mediately owing to its effects, their present conclusions, there has been a grent and pro

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