As contrasted with this highly centralized, highly organized banking system of Great Britain, attention may be given to the colonial systems of banking, of which those of Canada and Australia are good examples. In each of these countries there has been organized a relatively small number of banking establishments. In some instances colonial banks have been created under a general incorporation law like our National Bank Act, but subject to restrictions which kept the number of such banks very small. In others the banks were created through special charter which authorized the establishment of a banking institution vested with specified duties and powers. Whichever plan was followed, the result was practically the same in that the outcome was the creation of a comparatively small number of powerful institutions which directed interlacing networks of branches throughout the territory in which they were organized. Thus, under the Canadian banking system, thousands of branches scattered throughout the Western states gave to the population of Canada practically as many actually open or available banking offices as have been developed in the United States under the plan of incorporating independent banks. The result of the system was to establish a small banking community. In Canada the total number of banks is seventeen at the present time, and has seldom been much over thirty. In Australia to-day about twenty-five banks exist, and, although some of them have their head-quarters in London, the majority are locally incorporated. Unity of action in banking is obtained in each country through informal communications between the managers of the different banks or through action of the bankers' clearing house, which operates as a kind of combination or pooling of interests for the nation as a whole. While there is no central bank of rediscount, each bank is in itself sufficiently strong to exercise, under good management, many of the functions of a central bank, or in cases where material aid is needed, it may be obtained through interbank rediscounting or sale of bills on a considerable scale. In Canada, an element of centralization has been super-imposed through the creation of a joint guaranty fund held by the government and designed for the purpose of paying off the notes of any bank which may happen to fail. In Australia, centralization is in a measure obtained through the recent creation of the Commonwealth Bank of Australia, operated by the government and holding its deposits. The Commonwealth has, however, tended to be a bank among banks, and has never attained the pre-eminence of the Bank of England in Great Britain as a bankers' bank.

Taking the Canadian and Australian systems as types, therefore, they may be regarded as representative of a fairly well integrated and developed banking system. Their characteristic feature is seen in the application of what amounts to centralized control through a community of interest, moderately supplemented, as in the case of Canada, by some special features of public intervention or participation. Nowhere, however, in the British colonies has more than sporadic progress been made toward the establishment of a positive and direct governmental control over the banking system. The indirect control sought to be applied in some countries like Australia, through the chartering of a governmental institution, has thus far been only partially successful, and its future may be regarded as still to be determined.