In the case of the central banking systems there has been developed a nucleus which represents practically the combined banking strength or the pooling of bank reserves of the community. Other banks are then offshoots from such an institution, such as the Bank of England, not in the sense that they are owned or directed by it, but simply in that they look to it for guidance and direction, shape their policies in accordance with its doings more or less, and count upon its aid under certain given conditions. Before the opening of the European War it was believed that the British banking system was perhaps the best type of organization. That banking system included a number of large, strong institutions organized for the performance of regular commercial banking operations in England. These banks had themselves in many cases been developed out of a considerable number of other banks, so that each of them represented a pooling of interests. Each such bank had a considerable number of branches scattered throughout the United Kingdom, while the main office of each was in London. The Bank of England was thus surrounded by a group of strong commercial institutions. At other points in the United Kingdom were situated the headquarters of other banking systems. Thus in Scotland and Ireland independently organized institutions existed, each with its set of branches, and such banks usually had a branch in London for the purpose of transacting business with the Bank of England or of participating in the general financial market at that place. In all, there were in the United Kingdom probably about ninety banks with interlacing systems of branches; but the whole banking structure was practically dominated by a few strong banks with headquarters in London, to which reference has already been made. The Bank .of England, as the result of long practice and custom, was the holder of the bulk of the reserves of these banks. At times before the war the bulk of the cash held by the banks fell as low as 3 or 4 per cent of outstanding liabilities, and various banking authorities were inclined to view this with some alarm. The Bank of England, however, by maintaining a strong reserve and a liquid portfolio, kept itself in position constantly to meet the demands of the other banks, and consequently no British bank which was in possession of paper eligible for discount or salable in the open market was ever without the means of providing cash with which to meet the demands of its depositors. During the war, as elsewhere observed, there was a change in this state of affairs, the British banks amalgamating into a still smaller number of institutions. Confining attention, however, to the prewar situation, we may say that the British banking system was practically a pure central bank organization.