eed for an excess of issue beyond the limit.

In accordance with a law passed in 1906 the Imperial Bank issues notes
(_Reichsbanknoten_) of the value of 20 marks (L1), and 50 marks (L2, 10s.)
in addition to the 5, 10, 100 and 1000 mark notes (5s., 10s., L5, L50)
previously in circulation. Imperial paper currency of the value of 20 or 50
marks (L1 and L2, 10s.) had previously existed only in the form of treasury
notes (_Reichskassenscheine_); these will in consequence be withdrawn from
circulation.

The amendment of the banking law of Germany, passed in 1899, not only
affects the position of the Reichsbank, but that of the four other
note-issuing banks. The capital of the Reichsbank has been raised by the
bill of that year to L9,000,000. The reserve fund has been raised out of
surplus profits to L3,240,000. This exceeds the amount required by the act
of 1899, which was L3,000,000. The amending act further diminishes the
dividend receivable by the stockholders of the Reichsbank and increases the
share which the government will obtain.

The arrangement with the four note-issuing banks is designed to cause them
to work in harmony with the Reichsbank when the Reichsbank has to raise its
bank-rate in order to protect its gold reserves. The official published
rate of discount of the Reichsbank is to be binding on the private
note-issuing banks after it has reached or when it reaches 4%. At other
times they are not to discount at more than 1/4% below the official rate of
the Reichsbank, or in case the Reichsbank itself discounts at a lower rate
than the official rate, at more than 1/8% below that rate. If the
Reichsbank discounts below the official rate, it is to announce that fact
in the _Gazette_.

The subject being important, we quote from the amending act the sections
governing the discount rate:--_Gesetz, betreffend die Abaenderung des
Bankgesetzes vom 14. Maerz 1875; vom 7. Juni 1899, Artikel 7, S. 1_. The
private note-issuing banks are bound by _Artikel 7, S. 2_, after the 1st of
January 1901:--"(1) Not to discount below the rate published in S. 15 of
the bank law, so long as this rate attains or exceeds 4%, and (2) moreover,
not to discount at more than 1/4% below the Reichsbank rate, published in
S. 15 of the bank law, or in case the Reichsbank itself discounts at a
lower rate, not to discount at more than 1/8% below that rate."

It remains to be seen whether the note-issuing banks will find these
conditions too o