e extreme measures which have been required since the act af 1844 point
out for themselves the necessity for reform. Three times since the date of
the Bank Act of 1844 it has been needful to give permission for the
suspension of that act which forms the very foundation of the monetary
system of Great Britain. This, whenever it has occurred, has exercised a
very injurious effect on credit abroad, as well as on prosperity at home.

The British money-market, the clearing-house of the world, is, in
consequence of the smallness of its reserve, exposed to greater
fluctuations than that of any other country. These fluctuations may arise
from the need of meeting the requirements of other countries for specie or
those arising from domestic trade. The recorded excess of imports over
exports, L147,000,000 in 1906, though the difference is eventually balanced
by the "invisible" exports, gives foreign nations at times a power over the
British money-market greater than has ever previously been the case. The
current must always have a tendency to flow outwards; this is enhanced by
the great increase in the number of foreign banks which have branches in
England. The need of providing sufficient reserves to meet requirements
thus occasioned is obvious.

[Sidenote: British banking abroad.]

As regards the banks in which British interests are concerned in British
colonies and other countries we can only speak briefly. It must not be
overlooked that in the Dominion of Canada there are 29 banks, many of them
large, managed much on the Scottish principle with capitals of nearly
L19,000,000 and deposits of about L140,000,000. These banks have more than
1200 offices. In Australia and New Zealand there are 24 banks with capitals
of nearly L18,000,000 and deposits of about L130,000,000. The number of
offices is nearly 1700. There are, including the three Presidency banks,
about 15 banks doing business mainly in India--in some cases connecting
neighbouring countries and places like Bangkok, Hong-Kong and Zanzibar.
These banks have capitals of more than L5,000,000 and deposits of fully
L36,000,000 and over 210 offices. There are at least 8 banks in South and
West Africa with capitals of nearly L5,000,000, deposits of nearly
L50,000,000 and nearly 370 offices. There are 5 banks, including the
Colonial Bank, in other British territories with capitals of about
L1,000,000 and deposits of L3,300,000, and about 25 offices. There are
thus, besides many