The directors of the South Sea Company took legal advice, with a view to compel the bank to perform its contract; but the matter was arranged through the intervention of the government, who remitted to the South Sea Company two millions sterling as a compensation for the non-performance of the bank contract.
1721. By the 8th Geo. I. c. 21, the South Sea Company were authorized to sell £200,000 per annum, government annuities; and corporations purchasing the same at twenty-six years' purchase were allowed to add the amount to their capital stock. The bank purchased the whole of this £200,000 per annum, at twenty years' purchase, making £4,000,000.
1722. The bank capital increased £3,400,000 by a new subscription. This made the amount of capital £8,959,995 14s. 8d.
1726. The stock called three per cents. 1726, was created this year by the means of a lottery.
1727. The bank advanced to government, .£1,750,000 upon the coal and culm duties, at four per cent. interest (1 Geo. II. c. 8).
1728. The bank advanced to government, £1,250,000 upon the lottery, at four per cent. (2 Geo. II. c. 3).
1732. Thursday, 3rd of August, about one o'clock, the governor, sub-governor, and several of the directors of the bank, came to see the first stone laid of their new building, in Threadneedle Street; and after they had viewed the stone, on which his Majesty's and their several names were engraved, the same was covered with a plate of lead, and that, with the base of a pillar.
1734. Thursday, 5th of June. The directors began to transact business at their new house in Threadneedle Street. The business of the bank had previously been carried on at Grocers' Hall, in the Poultry. In the hall of the new building was erected a curious marble statue of King William III., with a Latin inscription, of which the following is a translation: -
For restoring efficacy to the laws,
Authority to the courts of justice,
Dignity to the parliament,
To all his subjects their religion and liberties,
For confirming these to posterity,
By the succession of the illustrious House
To the British Throne,
To the best of Princes, William III.
Founder of the Bank,
This Corporation, from a sense of gratitude,
Has erected this statue,
And dedicated it to his Memory,
In the year of Our Lord MDCCXXXIV.,
And the first year of this building.
1737. Considerable public discussion about the propriety of again renewing the bank charter. The following extracts from the "London Magazine" of this year will show the sentiments which different writers entertained upon this subject: -
"The bank have power to lend money on land, and no doubt might have put out prodigious sums that way, and have had a better interest for their money than most private people. Had the bank, then, lent out their money on land, they would have strengthened their credit and their interest, and also extended their usefulness by relieving the landed property, of which there is a great deal at this time in mortgage, most unaccountably, at five per cent., while inferior securities bear a premium at three per cent.
"Anosher branch of business which the bank have power to transact, but yet never meddle with, is the remittance of money backwards and forwards to London from all the chief trading cities in England, for which they should have proper offices or inferior banks erected in all such cities and towns as they intend to manage a remittance with; - this, besides what profit might be expected upon the remittances, would naturally bring great part of the cash which is circulated in the country to be lodged in their hands.
"I must next observe that in that branch of business in which they do employ themselves, which is that of a London banker, they very much contract and narrow their dealings, by refusing to take in payment the foreign coins, for which reason it is impracticable with many traders to keep their cash with them.
"This very privilege which the bank has for so long enjoyed, I could demonstrate to be a most heavy burthen upon the people, and a great prejudice to the landed interest as well as the trading interest of this kingdom; for if it had not been for this privilege, we should have had a bank, perhaps, in every county in England, and probably half a dozen different banks in London, by which means no merchant of tolerable credit could ever have been straitened for want of ready money at a low interest when he had occasion for it, nor would any landed gentleman who had a good title to his estate have been obliged to pay such premiums to brokers, or such an interest to mortgagees as they have now generally to pay; - whereas our present bank has never, so far as I have heard, assisted any landed gentleman, nor any merchant, except in and about London only.
"I am of opinion that with respect to the banking trade and the trade to the East Indies, neither the one nor the other can be carried on with such success, or in such an extensive manner, by private adventurers, as by a public company with such an exclusive privilege as our present companies have. The circulating of bank bills or cash notes must certainly increase the current cash of any country, and must, therefore, be of great use in trade; consequently, the more extensive and the more general such a circulation is, the better will it be for the inland trade of that country. It is true, a private man or set of men may, by a long series of good management, gain a very extensive credit, but that credit can never come to be so extensive or near so general as the credit of a rich public company, that has supported itself with honour, perhaps, for some ages; because the credit of a private man always depends upon himself, so that when he dies, his credit, as to any further circulation, generally dies with him, for it must require some time before those who succeed can revive or regain it; whereas a public company never dies, nor can their credit meet with any such interruption; and as their managers are always chosen annually by the company, there is a greater security for its being under good management than a private bank, whose chief managers are appointed by the chance of natural or legal succession: therefore, I shall always think it better for a trading country to have a public bank than to trust entirely to private bankers.