The duties of a discount clerk in some banks, especially smaller ones, are united with those of the note teller.

1. Discounts

A discount is a loan in which the interest, calculated on the face value of the note, is paid in advance, being deducted from the amount due the borrower. Thus, on a hundred-dollar note, payable one year after date, the bank would receive six dollars for a loan of only ninety-four dollars, which is more than six per cent.

2. Bank Discount

It was long ago decided that banks could deduct the legal rate of interest in advance, in the manner described, without rendering themselves liable for usury. This mode of calculating interest is sometimes called bank discount.

3. Offering Book

The discount clerk keeps the record of the notes offered to the bank in a book known as the Offering Book, and also of the disposition made of them by the directors. When paper is immediately discounted by the president, the record is different. In all cases, however, the notes discounted are entered in a book, usually termed the Dealers' Discount Book, which is so ruled that entries can be made in the following order: first, the maker's name, then the names of the indorsers, the place of payment, due date, running days, discount, and net proceeds. After further entries in different books concerning them, crediting the amounts to the borrowers, etc., the notes are put away, those of each day in a sepa-rate package.

4. Bills Receivable

The discount clerk has charge of the greater part of the bills receivable, which are kept in a compartment of the vault assigned to him, and are taken out the next morning by himself. If any of the officers wish to examine notes, they do so in his presence, or require him to show them. In this way his responsibility for them is preserved. He comes into frequent intercourse with borrowers, for they often apply to him to learn the fate of their applications.