SUMMARY OF WEEKLY RETURNS OF BANKS OF ISSUE FOR FOUR WEEKS ENDING JULY 1st, 1882.

Average Weekly Circulation of these banks for the month ending as above:-
Private Banks

..

..

£1,638,934 1,682,472

On comparing these amounts with the Returns for the previous month, they

And, ascompared with the corresponding month of last year:-
Decrease in the notes of Private Banks
Increase in the notes of Joint-Stock Banks

Total Increase as compared with the corresponding period of last year £31,065 The following is the comparative state of the circulation as regards the Fized issues:

The Private Banks are below their fixed issues

£1,909,232 708,666

Total below their fixed issues

..

£2,617,898

SUMMARY OF IRISH AND SCOTCH RETURNS TO JULY 1st, 1882.

The Returns of Circulation of the Irish and Scotch Banks for the four weeks ending as above, when added together, give the following as the Average Weekly Circulation of these banks during the past month, viz. :— Average Circulation of the Irish Banks Average Circulation of the Scotch Banks

Together..

On comparing these amounts with the Returns for the previous month, they

The Fixed Issues of the Irish and Scotch Banks a the present time, are:-
Ireland, 6 Joint-Stock Banks
Scotland, 10 Joint-Stock Banks

Together 16

£6,354,494 2,676,350

£9,030,844

£551,561 3,099,258

The Actual Circulation compared with the above gives the following results:--
Irish Banks are Above their fixed issues
Scotch Banks are Above their fixed issues..

Total Above fixed issues

£3,650,819

Average amounts of Gold and Silver coin held by these banks during the past month :

Being a Decrease of £57,939 on the part of the Irish Banks, and a Decrease of £357,278 on the part of the Scotch Banks as compared with the Return of the previous month.

CIRCULATION OF THE UNITED KINGDOM TO JULY 1st, 1882.

Average Weekly Circulation for the month ending as above, as compared with the previous month:

(From Wetenhall's Stock Exchange List.)

THE BANKERS' MAGAZINE

AND

Journal of the Money Market.

SEPTEMBER, 1882.

BANKING CAPITAL AND LIMITED LIABILITY.

THE adoption of limited liability by the joint-stock banks of England and Wales has now advanced so far, that we may fairly at the present time proceed to take stock of the alterations which have hence resulted in the amount of the capitals and reserve funds of the banks. So recently as four, or even three years ago, the majority of English joint-stock banks were unlimited in their constitutions, and it seemed but little likely that any immediate alteration would be made in this respect. Many of the older men connected with joint-stock banking were strong in their objections to any change of plan. They thought limitation of liability undesirable, they believed it to be uncalled for, they resisted a change which they considered alike unfair to the creditors of the banks and lowering to their own prestige. But the general body of those concerned were of a different opinion. The shareholders were almost unanimous in approving the change, and in desiring to place a limit to the risk to which their estates were exposed by being proprietors of bank shares. Gradually the feeling, we might call it the prejudice, against the alteration in constitution, and the addition of the word "Limited" to the description of a bank, was overcome. It

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became more generally understood that there was nothing un suitable in a bank being limited. Precedent, always a potent factor with Englishmen, was quoted in favour of the form of association, in the most respectable example that could be brought forward. The Bank of England itself is limited by charter. Could any other English bank do wrong in following that example?

When limitation of liability was proposed, those in charge of the interests of the banks felt one thing very strongly-that the change could never be suitably made unless the banks offered those who did business with them-those, in fact, who trusted them with their money-solid and adequate security. If the old arrangement-the liability to the last shilling and the last acre-were to be given up, something very substantial should be proposed in its place. The result was that in almost every instance the alteration in the liability of banks was accompanied by heavy additions to the capitals, and also, as a natural result, to the reserve funds as well. The high standing the banks had already obtained enabled them to offer their new shares at a considerable premium, which formed a substantial addition to the reserve. The shareholders are in most instances liable for four times as much, and in some cases for a larger multiple of the paid-up capital. This ought to make the depositors abundantly secure. Sufficient capital to meet any sudden demand is essential to the efficient working of a bank, although real safety in business does not consist so much in the possession of large amounts to work with as in careful management. The capital of a bank ought always to bear a very solid proportion to its deposits. The statement which follows at the close of this article contains a list of the joint-stock banks of England and Wales as their capitals and reserve funds stood in 1877, and as they stand now in 1882. The former date was selected as being a sufficient length of time before the failure of the City of Glasgow Bank and of the West of England and South