aces possess all the stability of branches of a
great central house is obvious, both in the increase of security to
depositors in time of financial stress and also in the ability of such a
house to lend money at lower rates of interest than is possible to the
poorer institution with its smaller capital which has no connections and
no resources beyond what are locally in evidence. It may be questioned,
however, whether the country as a whole would not lose much more than it
would gain by the less complete identification of the bank with local
interests. It would be inevitable that in many cases the local manager
would be restrained by the greater conservatism of the authorities of
the central house from lending support to local enterprises, which he
would extend if acting only by and for himself as an independent member
of the local business community. It is difficult to see how the country
as a whole could have developed in the measure that it has under any
system differing much from that which it has had.

In theory it may be that the functions of a bank are precisely the same
in Great Britain and in America. In practice different functions have
become dominant in the two. In England a bank's chief business is to
furnish a safe depository for the funds of its clients. In America its
chief business is to assist--of course with an eye to its own profit and
only within limits to which it can safely go--the local business
community in extending and developing its business. The American
business man looks upon the bank as his best friend. If his business be
sound and he be sensible, he gives the proper bank official an insight
into his affairs far more intimate and confidential than the Englishman
usually thinks of doing. He invites the bank's confidence and in turn
the bank helps him beyond the limits of his established credit line in
whatever may be considered a legitimate emergency. In any small town
whenever a new enterprise of any public importance is to be started, the
bank is expected to take shares and otherwise assist in promoting a
movement which is for the common good. The credits which American
banks--especially in the West--give to their customers are astoundingly
liberal according to an English banker's standards. Sometimes of
course they make mistakes and have to pocket losses. When a storm
breaks, moreover (as in the case already quoted of the panic of 1893),
they may be unable to call in their loans in time