ized, and that the provincial note issue,
which is a very convenient power for a bank to possess, and incidentally a
considerable advantage to its customers, has been swept away without any
attempt being made to remedy its deficiencies. There may be objections
raised to a note circulation secured by the bonds of the government, but
the security of the note issues of the national banks of the United States
made against such bonds, has scarcely ever been questioned.

A different policy was followed by Sir Robert Peel in Scotland and in
Ireland from that which he established in England. By the acts of 1844-1845
the Scottish and Irish banks were allowed to exceed their authorized issues
on holding specie to the amount of the excess, and no restrictions were
placed on amalgamations among banks in these countries. In Scotland and in
Ireland notes for less than L5 continued to be allowed. The result has been
that the ten large banks in Scotland, and six of the nine banks in Ireland,
possess the power of issuing notes. The large proportion of local branches
in these countries has been greatly assisted by this power.

[Sidenote: Amounts in circulation.]

Originally, besides the Bank of England, nearly all the provincial banks in
England and Wales possessed the privilege of issue. These banks continued
their operations as previously during the time while the Bank Act was
discussed in parliament. When the arrangements which that act created were
made public, nine banks, of which eight were private and one was a
joint-stock bank, ceased to issue their notes prior to the 12th of October
1844, when the act came into operation. Of these, the Western District
Joint-Stock Banking Co. was dissolved, one of the private banks was closed,
the remaining seven issued Bank of England notes and were allowed certain
privileges for doing this. By the act of 1844 the maximum circulation of
the English issuing banks was fixed at the average circulation of the
twelve weeks before the 27th of April 1844.

The number of the banks to which the privilege of circulation was then
allowed and the amount of notes permitted were, in England:--

207 private banks with an authorized issue of L5,153,417
72 joint-stock banks with an authorized issue of 3,478,230
------------
L8,631,647

The actual circulation of the country in October 1844