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twenty-five. The borrowing and lending of money on stock are matters of daily occurrence. This is not always done through brokers. Individuals often effect these transactions directly with the banks. The general rule is that the lender shall have a margin of 5 per cent. on the value of the stock, and shall be entitled to call for additional security whenever the market price falls below that difference.

We have noticed the different meanings given to the word "circulation" in England, since the passing of the Act of 1844. By the Act of 1845, it is enacted that this word shall have the following meaning in Scotland and Ireland:

"Section 17.-And be it enacted, That all bank notes shall be deemed to be in circulation from the time the same shall have been issued from any banker, or any servant or agent of such banker, until the same shall have been actually returned to such banker, or some servant or agent of such banker."*

The Exchanges between the Banks.

Since the Act of 1845-when other banks besides the Bank of Ireland acquired the power of issuing notes in Dublin-a system of clearing, or, as it is called, of exchanges, has been established, similar to that established in Edinburgh. following is a copy of a clearing balance-sheet:

BALANCES OF EXCHANGES WITH OTHER BAnks, on

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Here we may observe that all the banks that clear are banks of issue; and the clearing in Dublin includes all the banks of issue in Ireland, although three of these banks have their head

It may be stated here that the circulation of the Issue Department of the Bank of England is always 14,000,000l. more than the amounts of gold and silver held in that department. The amount of the circulation in the hands of the public is found by deducting the amount of bank notes in the Banking Department from the amount of circulation of the Issue Department.

quarters in Belfast. Two of the Belfast banks clear by their agents. The Bank of Ireland is the agent for the Northern Banking Company, and the Ulster Bank has a branch in Dublin. It will be observed that the Bank of Ireland-the chartered bank-is a member of the clearing; and, in fact, the clearing is held daily, at two o'clock, in one of the rooms of that establishment. The differences are paid daily, like those at Edinburgh, in exchequer bills. The following are the amounts required to be held by each bank:

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Those banks in Dublin that are not banks of issue are not members of the clearing. All the non-issuing banks, however, have accounts with the Bank of Ireland, and pay into that establishment the cheques they may have on the other banks. The issuing banks which attend the clearing have no account with the Bank of Ireland.

This system of clearing appears to work very satisfactorily. The following is an extract from a letter I received from an Irish banker on the subject:

The settlement of our 'exchange balances' in Dublin, through the use of exchequer bills, works very well. The great evil, previously, was, that when these balances were of magnitude, Dublin was such a limited money market, there was difficulty and expense in raising the needful quantity of Irish money for the purpose. If you anticipated the balance to be heavy against you, it was requisite to prepare some time before, and to have your funds lying idle and unproductive until the crisis arose. Now, we have exchequer bill interest for our surplus, and the power of replenishing our stock account whenever required by drawing on London, thus possessing the unbounded advantages of the greatest money market in the world. In point of fact, the arrangement has virtually changed the venue, and made London the actual and final place of settlement, through machinery worked in Dublin."

"Regulations for making exchanges between the several banks in Ireland, at Dublin, and for settling the balances of such exchanges, at Dublin; to take effect from and after the 8th day of December, 1845.

"1. The exchange shall be made daily at two o'clock, P.M.

"2. The payments of the balances snall be made in exchequer bills, except for the fractional parts of 500l., which may be paid in the notes of the particular bank debtor.

"3. The exchequer bills shall be filled up in favour of the bank who may be the original holders,* and shall bear the distinguishing mark of 'Dublin Exchange Bills,' showing that they belong to the Dublin exchanges, and are not intended to be used for any other purpose, and shall be received at par, with the interest that may be due when the transfer takes place.

"4. The amount of exchequer bills to be kept in the circle is fixed at 402,000l., to be apportioned amongst the following banks in fixed sums, calculated in their respective amounts of circulation:—

Bank of Ireland.
Provincial Bank.

Ulster Bank.
National Bank.

The sums being once fixed, each bank is to maintain its quota at all times, as hereinafter provided.

"5. Nine-tenths of the exchequer bills to be of 1000%., and one-tenth of 5007.

"6. The amount of exchequer bills held by each bank shall be stated every day in the Clearing-room.

"7. It is expedient that no bank shall be obliged permanently to hold more exchequer bills than a surplus of one-third above the fixed amount, nor shall be allowed to reduce the amount held more than one-third below the fixed amount; but as the exchequer bills will accumulate with some of the banks, and be required by others, it shall be imperative on the parties so situated to sell or buy exchequer bills; that is to say, the bank holding the greatest amount of exchequer bills shall be bound to sell to the bank in want of them, what may be required for the legitimate purposes of the exchanges; but it shall not be imperative on that party to sell a greater amount than what will reduce their stock to the original quota, and the purchaser shall be bound to take bills from those parties having the greatest proportionate amount of them beyond their respective original quota.

"8. The preceding regulations will tend in a great degree to equalise the amount of exchequer bills; but if exchequer bills shall nevertheless accumulate in the hands of a bank, so as to exceed their original quota by more than one-third, that party shall have the power to call upon the party or parties holding the smallest amount in proportion to their quota to purchase the excess-that is to say, the excess above their quota-plus one-third; but it shall not be imperative on any party to take more than is required to bring up their stock to two-thirds of the original amount.

"In this way the fluctuation in the amount of exchequer bills amongst the different banks, which is an essential part of this arrangement, need never permanently exceed one-third more or one-third less than the original quota of each bank.

"The terms of purchase to be governed by the next regulation.

* They are not now filled up in favour of the bank who may be the original holders, but are stamped by each bank and are payable to bearer.-EDITOR.

"9. The bank seeking to buy, or being called upon to buy, exchequer bills, from the bank or banks holding in excess of their quota, shall pay for the purchase by a Letter of Credit on their London correspondent, demandable on the fifth day after the date thereof, the purchaser paying 1s. 3d. per cent. on the amount of the Letter of Credit;* or to pay the amount in gold in Dublin, at the option of the holders of the bills.

"10. The exchequer bills to be used for the Dublin exchanges are to be as nearly as possible divided into the two dates of March bills and June bills, which are to be exchanged at the Paymaster-General's Office here before due, and new ones to be provided, so as to keep up the stock in the circle; and no exchequer bills advertised to be paid are to be used in the exchanges.

"11. Each bank is to be always liable to the income-tax on the interest of its original quota of exchequer bills, and no more; and the exchequer bills advertised to be renewed are, within a week after the Government notice appears in the Gazette, to be given up to the original holders, upon receiving other bills not advertised; failing which, a Letter of Credit on London, demandable on the fifth day from its date, subject to the charge as stated in No. 9, is to be given, or the amount to be paid in gold, at the option of the holders of advertised bills.

"12. The exchanges are to be made at the Bank of Ireland, who undertake to pay those banks who are creditors in the exchange the exchequer bills or bills of exchange received from those banks who are debtors in the exchange; but the Bank of Ireland shall not be in any way responsible for the exchange transactions, or otherwise soever.

"13. The statement of the balances after they are struck to be sent to their respective banks from the Clearing-room, by their clerks; and the clerks of bank creditors to be in waiting to receive the amount due to them at two o'clock.

"14. Any bank a party to this agreement to have the power of withdrawing from it, and receiving back their exchequer bills at par, upon payment of them if needful, upon giving three months' notice.

"15. No bank a party to this arrangement shall, after the 8th of December, 1845, directly or through any agent, demand gold from or pay gold to any other bank or banks parties to this arrangement, except as herein before provided, unless under special agreement between any two of the banks they mutually arrange to pay and receive a sum of gold.

"It is assumed that each bank always has its statutory amount of gold; and if any bank be either in excess or deficiency in that amount, the export or import of gold must be borne by the bank seeking to diminish or increase its stock.

"Any violation of this regulation after the 8th of December, 1845, to be considered a virtual withdrawal of the bank who departs from this rule.

"N.B. The foregoing arrangements are to be subject to such alterations and amendments as may be required and agreed on by the several banks parties thereto, after the plan shall be in operation, and its working effect ascertained."

* Drafts or Letters of Credit are now granted without any charge beyond the five days allowed for the settlement.-EDITOR.

SECTION VII.

THE MORAL AND RELIGIOUS DUTIES OF BANKING COMPANIES.

"I implore the blessing of Divine Providence on our united efforts to encourage the industry and increase the comforts of my people, and to inculcate those Religious and Moral Principles which are the surest foundation of our security and happiness."

SPEECH FROM THE THRONE, Aug. 9, 1845.

"Property has its Duties as well as its Rights."

THE LATE MR. DRUMMOND.

THIS is the age of public companies. The principle of association is one of the most powerful agents of modern times. Whatever object we wish to accomplish-whether political or commercial, literary or religious-the first step is to form a society. Those joint-stock associations that involve the outlay of capital with a view to profit, are called public companies, and these form the subject of our present inquiries.

Public companies now occupy a distinguished place in our social economy. We receive our education in schools and colleges founded by public companies. We commence active life by opening an account with a banking company. We insure our lives and our property with an insurance company. avail ourselves of docks, and harbours, and bridges, and canals, constructed by public companies. One company paves our streets, another supplies us with water, and a third enlightens us with gas. At home, numerous luxuries are brought within our reach by different companies. And if we wish to travel, there are railway companies, and steamboat companies, and naviga tion companies, ready to whirl us to every part of the earth. And when, after all this turmoil, we arrive at our journey's end, cemetery companies wait to receive our remains, and take charge of our bones.

The question that now claims our attention is, whether these powerful companies ought to be regarded as moral agents?— that is, whether they are capable of virtuous and vicious actions, and, like individuals, are responsible to a Superior Power, who will reward or punish them according to their works.

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