Collecting Agents.

Question 217.— A bank receives on deposit from one of its customers a sight draft which is sent for collection to a branch of La Banque Ville Marie. The latter remit by draft on the head office, but before the draft can be presented the institution closed its doors. Can the first bank look to its customer for the amount?

Answer.—The cases make it clear that unless the bank sent the bill to the Banque Ville Marie at the request of the depositor, they are responsible for the consequences of sending it there.

" Cut " Collection Kates between Banks.

Question, 218.—I recently received two letters from a branch of a certain Canadian bank offering to make collections in the town and vicinity (where it had recently opened), first at 1-10 of 1 per cent., minimum 10c, and later at 1-16, minimum, 8c, evidently desiring to take this class of business away from a bank which had been established at this point for many years. I replied that we were quite satisfied with our present arrangements for collecting, and had no intentions of making a change.

I would be glad to have your opinion as to the propriety of the action of a bank in cutting rates in this manner.

Answer.—The members of the committee are unanimously of opinion that competition of the kind referred to is most inadvisable, and that banks should not help it on by accepting " cut" rates. The question is, however, one respecting which we could scarcely do more than express the views of the members of the committee unofficially.