"XII. That if any banker in any part of the United Kingdom who after the passing of this Act shall be entitled to issue notes shall become bankrupt, or shall discontinue the issue of notes, it shall not be lawful for him to resume such issues.
"XIII. That every banker claiming under this Act to continue to issue notes in England or Wales shall, within one month after the passing of this Act, give notice in writing to the commissioners of stamps and taxes of such claim, and of the place and name and firm at and under which such banker has issued such notes during the twelve weeks next preceding the 27th of April, 1844. and thereupon the commissioners shall ascertain the average amount of those twelve weeks' issues; and it shall be lawful for every such banker to continue to issue his own a: Provided, nevertheless, that such banker shall not have in circulation upon the average of a period of four weeks, to be ascertained as hereinafter mentioned, a greater amount of notes than the amount so certified.
"XIV. That if it shall be made to appear to the com-ioners of stamps and taxes that any two or more banks have become united within the twelve weeks, it shall be lawful for the commissioners to certify the average amount of the notes of the two or more banks so united as the amount which the united bank shall thereafter be authorized to issue, subject to the regulations of this Act.
"XV. That the said commissioners shall, at the time of certifying, publish a duplicate of their certificate in the 'London Gazette,' and the ' Gazette' shall be conclusive evidence in all courts whatsoever of the amount of notes which the banker named in such certificate or duplicate is by law authorized to issue.
"XVI. That it shall be lawful in case banks become united, for the commissioners to certify the amount of bank notes which each bank was authorized to issue, and the amount stated shall be the limit of the amount of notes which such united bank may have in circulation : Provided always, that it shall not be lawful for any such united bank to issue notes at any time after the number of partners therein shall exceed six.
"XVII. That if the monthly average circulation of notes of any banker shall at any time exceed the amount which such banker is authorized to issue, he shall in every such case forfeit a sum equal to the amount by which the average monthly circulation shall have exceeded the amount which such banker was authorized to issue.
"XVIII. That every banker in England and Wales authorized, under the provisions of this Act, to issue notes, shall transmit to the commissioners of stamps and taxes a weekly account of his issues, for them to publish in the 'Gazette;' and if such banker shall neglect or refuse to render such account as required by this Act, or shall render a false account, he shall forfeit the sum of £100 for every such offence.
"XIX. In this clause the mode of ascertaining the average amount of notes of each issuing bank was set forth.
"XX. The commissioners were empowered to cause the books of bankers, containing accounts of their notes in circulation, to be inspected, and, if it were thought fit, copied; and a penalty, in case of refusal, of £100 for every such offence imposed on the refusing banker.
"XXI. All bankers to return their names once a year to the Stamp Office.
"XXII. Bankers to take out a separate license for every place at which they issue notes or bills; with a proviso in favour of bankers having four such licenses in force on the 6th of May, 1844.
"XXIV. The Bank of England are authorized to compound with banks desirous of withdrawing their own notes and issuing those of the Bank of England; the amount of composition not to exceed 1 per cent. per annum, and payment thereof to cease on the 1st of August, 1866.
"XXVI. Any society or company, though exceeding six in number, carrying on the business of banking in London, or within sixty-five miles thereof, may draw, accept, or indorse bills of exchange, not being payable to bearer on demand.
"XXVII. The bank are to enjoy the privileges secured by this Act, subject to redemption upon twelve months' notice, to be given after the 1st of August, 1855, and upon repayment of the public debt, and of all sums and arrears whatsoever owing to them by Government."
A searching inquiry will be found in a previous part of this work into the design, import, and effects of this much-debated Act.
We proceed to give a summary of the business operations of the bank, and of the changes which have taken place in its relations to Government and the public since the publication of the former editions of this work.
The Bank of England can now issue to the extent of £15.000,000 against that amount of securities set apart fur this purpose. It can issue to any farther amount against lodgments of gold and silver, as regulated by the above Act. This amount of .£15,000,000 may be issued either at the office in London or at the branches. Were the bank to reduce the number of its branches it would not be required to issue less than this £15,000,000; and were the bank to increase its branches, it could issue no more. If other banks discontinue their circulation, it may upon application receive permission to extend its issues to two-thirds the sum thus withdrawn; but all the profit of this increase must go to the Government. It cannot issue any note for a less amount than five pounds. All the notes are payable in gold on demand. The payment of those issued in London can be demanded only at the London office. But the payment of those issued at the branches may be demanded either at the London office or at the branches where they were respectively issued. Bank of England notes are a legal tender in all cases, except when tendered by the bank itself.
It will be observed that the issue against securities is now £15,000,000 as compared with £14,000,000 at the time of the passing of the Act. The occasions and reasons for this increase have been lucidly set forth as follows in the "Bankers' Magazine" for March, 1866 :-