paper, which they never issue but in cases of urgent necessity: they all draw bills upon Dublin at thirty-one days, which gives them a premium of one-half per cent; and the reason of their paying their notes only at their banks is to receive this profit.

During my stay in Ireland, I collected some information on the nature of the private banks of that country;* I do not, however, feel myself at liberty to name my authorities. The same motive prevents me from adverting to many important facts, the vouchers for which are now in my possession; for, although they might be of public benefit, considerations of respect for private feelings and private interest forbid premature interference in so delicate a subject as the concerns of private banking companies.

In Leinster there are three bankers, one in Wexford, one in Birr, and one in Kilkenny. There was one at Ross, who lately failed.+ The notes of the Dublin bankers circulate in this province.

The three private bankers, who issue the most notes in Dublin, are:

John Finlay and Co.

J. C. Beresford and Co.

Robert Shaw and Co.

There are three others; but their business is conducted on a much more limited scale.

Two of the largest bankers in Dublin are merely bankers of deposit; they issue no paper whatever.

In Ulster, the Lurgan bank had in circulation, in the summer of 1808, paper to the amount of £170,000.

The three Belfast Banks, which were called the commercial, the northern, and the Belfast, issue, perhaps, altogether £225,000.

In speaking of the Belfast banks, it may be worth while to remark, that a private bank, established there nearly sixty years ago, issued notes, but afterwards fell to the ground. Of those banks which have ceased to exist, I do not feel restricted from communicating such well authenticated information as came to my knowledge. I shall therefore subjoin, in a note, some particulars relating to them; and also to the

* Nothing is more erroneous than the list of private bankers given in the Dublin Almanack. Three Stewarts now, before one; neither Mr. Anderson's bank at Fermoy, or Lord French's at Tuam, are included, and many are put down which have failed.

+ JULY 16th, 1809. NEW-Ross.-Dr. Doyne says that the circulation of this country consists of private bankers' post-bills, payable at ten days after sight. The Ross bank, which failed on Mr. Colclough's death owed £200,000.

The following information respecting these banks I received in the month of May, 1810, from a corre spondent, on whose accuracy I can fully depend."The average issue of notes by each of the Belfast banks may be stated at from £50,000. to £100,000.; for it greatly varies, from a variety of circumstances, sometimes falling below, and sometimes exceeding either of these sums."

MAY 29th, 1811. BELFAST.-"The three banks at present in existence, charge six per cent discount; but use no gold. They manage their affairs in such a manner as to make it the interest of the merchants to furnish them

discount office, which, perhaps, may be interesting to readers desirous of becoming acquainted with the history of paper circulation in Ireland.*

The Londonderry bank is by no means extensive, on account of the property which the Beresford family possess in that county, causing the notes of their bank in Dublin to circulate widely in that part of Ulster.

In Connaught, there are four bankers at Galway, and Lord French's bank at Tuam. Their issues are chiefly in post-bills, with their amount I am unacquainted; as their notes are not payable in Dublin, their circulation is confined to this

province,

them with a certain quantity of Dublin bills, proportioned to the Belfast paper which they receive. These Dublin bills are procured by the bankers, at a rate rather cheaper than the market price; and this constitutes a part of their profit, of which the law can take no hold."

* MAY 28th, 1810. BELFAST." The old banks paid their notes in gold, and the difficulty of procuring guineas in Dublin, was the cause of their giving up business, which they did in 1797.

"The circulation of the Belfast bank, which broke up in 1797, was £40,000., occasionally £50,000. ; but neither of these sums could be considered permanent, because a scarcity of gold always brought in a considerable number of the notes. The circulation of these sums was after the first bank had ceased to exist. The gentlemen by whom the bank was first established were induced to dissolve their partnership, on account of the alarming situation of Ireland in 1797, the year preceding the rebellion. A member of the second bank, and one of the first, formed a new company, and continued it for some time; but I have understood that the last bank received little benefit by it; and the first, after carrying on the business for ten years, that is, from 1787 to 1797, made scarcely any thing more than the interest on the actual capital engaged."

MAY 28th, 1810.-" There were lodgments made in the discount office to the amount of £405,000.; but we are not to imagine that this capital, or one third of it, was ever in the office at one time. Let us suppose £10,000. to have been deposited in the establishment; this sum, getting into the hands of the merchant, would pay the grazier, farmer, &c., and then return from him to the discount office. The lenders, for this money, received 5 per cent. interest; and it was employed as a capital, in such a manner as to produce 8 per cent. by discounting bills. But though this mode of business was publickly known, the terms daily advertised, and the whole trade, both in the town and neighbourhood, carried on in this way, a trial took place at Cork, about two years ago, which shewed the whole transaction to be illegal; and fear of the consequence made the company break up."

"The Belfast Discount Company commenced in the year 1793, on a principle of discounting inland bills, and purchasing foreign drafts, and disposing of them as might suit their own interest and accommodate the town. It was originally formed in ten equal shares; but, by the death of two of its partners these were, some years after, reduced to eight. The business of the establishment was conducted by three of the members, Mr. Thompson, Mr. Bradshaw, and Mr. M'Ilvane, under the firm of Robert Shaw and Co. till the decease of that gentleman, in the year 1800; after which event the business was continued, the direction being intrusted to Mr. Bradshaw, under the firm of Gilbert, M'Ilvane, and Co. The capital of the house, at its commencement, did not exceed £50,000. At the period when it was determined to wind up its affairs, the capital, chiefly a borrowed one, amounted to upwards of £400,000. This establishment was adopted last year, instead of banks which, for some years, had been given up. The town of Belfast has, in general, manifested an inclination to encourage the banking system; but at this time a gold and paper medium of circulation being found troublesome, the Discount Company were obliged to give way to this sentiment, which was strengthened by the desire of some of the members to become partners in a banking-house."

in which, it is to be recollected, tally payments are common in the settlement of accounts.*

The greatest banker in Munster is the treasurer for the county of Cork, who resides at Mallow. In the city of Cork there were five bankers in November 1808, one of whom, the house of Sir James Cotter and Co., has since failed for £420,000. There was also a discount-office similar to that in Belfast.

At Limerick there are three bankers. At Clonmell there were two. There is one at Fermoy, one at Tipperary, and one at Ennis. At Waterford there were three, but one of them has failed. At Kilkenny there is a small one.

A return of registered bankers was made to the Irish Committee, on the 11th of April, 1804, at which time there were in Dublin six; but one of these having failed, and two new ones having been since established, there are now seven.

In Waterford there were two, one of whom failed. Another, who commenced business since, has shared the same fate. A new firm then arose, and vanished like "the baseless fabric of a vision." The old one, Messrs. Newport and Co., is therefore, the only one remaining.

In Cork there were six, two of whom have since failed.

In Limerick two, one of which has failed; but, to supply its place, two new houses have been established.

In Wexford there were seven, five of whom have failed, and one has given up the business; two new firms have been formed, which, with the old one, that of the Messrs. Redmonds, still remaining, makes the number amount to three.

In Enniscorthy there are, at present, no bankers.

* October 9, 1809. BALLINASLOE.-The country bankers are contending who shall exchange the greatest number of their notes for the bills of the counties of Meath, Kildare, and Dublin graziers.

BLOOMFIELD, County of Mayo.—Mr. Rutledge says, the circulation of this neighbourhood consists of Galway and Tuam notes, at and above three guineas. They are post-bills, which are never accepted. Any person having a quantity of them, must make a journey to get them accepted, and will, probably, be obliged to take a bill on Dublin, at forty-one or sixty-one days. He has observed the hearth-money collector receive provincial notes, upon which he exacted "discount." a

December 10, 1808. WATERFORD.-Newport Bank has notes in circulation to the amount of £150,000. I waited near an hour in a banker's shop this morning to exchange some private notes for others of the Bank of Ireland; but the clerks, who appeared to be busy, took no notice of my application, and I was at length obliged to leave the place without accomplishing my purpose.

April 18, 1808. WATERFORD.-Detained two hours by my servant not being able to get provincial notes changed for others of the Bank of Ireland. He was at one of the banks this morning, but the reply of the clerks always was, "we are very busy." If they have so much to do, there ought to be more of them, according to the extent of their business. Such an instance could not occur in a well regulated bank in England; yet this bank is in full credit.

December 6, 1808. MAREFIELD, near CLONMELL.-Mr. Bagwel believes the notes circulated by the Clonmell bankers to amount to about £200,000.

At New Ross there were four banks, three of whom failed, the house of Mr. Roe only remaining.

At Dungannon there was one; but there are none at present.

At Kilkenny there were three, two of whom failed; the other still remains. Clonmell had no more than two, which were registered. The house of Mr. Rials has been a long time established, and still remains.

Hence it appears, that the whole number of registered bankers in 1804 was fifty, of whom nineteen now remain; the rest having disappeared, and I believe, for the most part have failed. Since that time, two new houses have been established in Dublin, those of Lord French and Co. and of Messrs. Alexander.

The number of bankers, therefore, remaining, are thirty-three instead of fifty, unless subsequent failures have taken place. None of these were shop-keepers or issued notes; some account of them will be given hereafter, when I have to treat of silver

notes.

In the Report of the House of Commons* it is stated, that in the year ending the 25th of March 1800, the number of bankers issuing notes was

1st of January, 1801

1802

1803
1804

11

23

29

30

40

and in the preceding page they are said, in the last-mentioned year, to have been fifty.

In 1810, I enumerated, as before stated, thirty-three bankers, two of whom, Messrs. Latouche and Sir Thomas Newcomen, do not issue notes; these, therefore, being deducted, the number remaining will be thirty-one.

Some cause ought to be assigned for the failure of so many of these banks, as it appears that such a misfortune could not have taken place, but from mis-management. A banker who understands his business would, on an issue of £100,000, reserve £33,000 to meet the payment of his notes,+ and his income would, there

+ Sir James Steuart says, "nothing but experience can enable them to determine the proportion between

* Page 10.

fore, be equal to the interest made by the £67,000 left in his hands, which ought to be invested in undoubted securities, at the Irish interest of six per cent., having only a short time to run, "if the solidity of a bank which lends upon private security does not so much depend upon the extent of their original capital, as upon the good regulations they observe in granting credit.*" This sum would yield him £4,000 per annum. The expense of stamps, clerks, house-rent, &c. may be considered as liquidated by notes which are never presented for payment. These failures, therefore, we must conclude have arisen either from improper transactions, negligence, or ignorance.

It has been stated to me by intelligent bankers here, that any house which pays for issuing its notes, must of necessity fail; because the trade and transfers of a limited district of country, can require but a certain amount of circulating medium.+ Whatever is issued beyond that sum, returns as fast as it is sent out. The continued commission, therefore, which is paid for getting notes put into circulation, must bring ruin

the coin to be kept in their coffers, and the paper in circulation." In the present state of the monetary system of Ireland, the word "coin" must be changed for National Bank notes. Vol. iii. book iv. ch. iv. p. 201, of his works.

Ibid. vol. iii. ch. iv. p. 205.

+ Mr. Malthus seems to be perfectly aware of this principle, when he says, "the paper issues of a country bank are, as I conceive, measured by the quantity of its notes which will remain in circulation, and this quantity is again measured, supposing a confidence to be established, by the sum of what is wanted to carry on all the money transactions of the neighbourhood. Malthus on Population, edit. 1803. p. 403.

When I make this remark, I beg leave not to be classed among those who assert, that bankers never issue their notes, but for value first paid to them. This is one of those erroneous positions, which, though true in detail, are false as a general fact. But it will be best elucidated by giving an example of a mercantile transaction. A merchant at Liverpool has a cargo worth £10,000. consigned to him from abroad. He sells the invoice, the bill of lading, and the policy of insurance for £10,500. to another merchant, and receives his acceptance for the amount, which he gets discounted by a banker, or the Bank of England, who gives him promissory notes for the amount. On the one hand, they do not issue these notes without value received in the merchant's acceptance, which represents the cargo not yet arrived. The second merchant sells it before arrival for £11,000. to a third person, and procures another acceptance, which is, in the like manner, converted into bank notes. Thus an issue is sent abroad for £22,000. of bank notes, raised upon only £10,000. of merchandise not yet in England; but this third merchant sells to a fourth, and the fourth to a fifth, as has actually been the case, for I am here relating an account of transactions which fell within my own knowledge; so that on this occasion, £100,000. of acceptances, raised upon a cargo of merchandise which foundered, were discounted in this manner. Hence, though a banker does not issue his notes without value received, aņ immense issue may be sent afloat without any real representation of property. I am inclined to conclude, that part of the discounts at the Bank take place under similar circumstances, and to ignorance of this fact I impute some of those erroneous doctrines in regard to circulation which I have so frequently heard promulgated. Mr. Henry Thornton has adverted to this circumstance, yet Mr. Manning, the deputy-governor of the Bank, in the spring of 1811, exultingly asked, "if they (the Bank proprietors) gave away their notes to every person who asked for them;" and he argued as if he imagined that no note was issued but what was the representative of so much real property.