Category Archives: Banking

Lloyd’s Coffee House

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We discovered this interesting article on the history of the Lloyd’s Coffee Houses – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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Lloyd’s Coffee House

It is difficult to decide whether Lloyd’s Coffee-House is more to be admired for its commercial importance, or for the many acts of benevolence with which its name and its subscribers are associated. This coffeehouse, which derives its name from the individual who first kept it, is over the northern piazza of the Royal Exchange; and though presenting none of those attractions which would allure the gentleman who loves “to take his ease at his inn,” is more frequented than all the other coffee-houses in London. It is indeed the centre of British commerce; the point where it concentrates, and whence it diverges over the globe. A bank post-bill does not obtain a readier currency than an article of intelligence from Lloyd’s, and to name this house as an authority is quite decisive  with every person who knows the means of information it possesses, and its accuracy.

Lloyd’s Coffee-House is the great mart for maritime insurance, and in order to obtain correct information it has agents in almost every port in Christendom, who are in regular communication with it, announcing every event that can in the most remote degree affect the political or commercial interests of the country. It was by these means, that during the late war government was often apprized of events, of which they had received no official intelligence, the arrival and sailing of vessels, a list of captures, accidents, and every thing relating to the shipping interests being regularly kept. One room in this coffee-house is appropriated to subscribers, who pay £25 on being admitted, and four guineas a year. No person, however, can be admitted without being recommended by six members, and approved by the committee of management.

The subscribers to Lloyd’s Coffee-House have been as much distinguished for their patriotic benevolence as for the extent of their commercial relations, and it was with this body that the PATRIOTIC FUND originated. This noble charity, the object of which was to provide relief for the widows and orphans of such as die in their country’s service, as well as to remunerate the wounded, was commenced on the 28th July [1803] with a donation of £20,000. three per cents, by the subscribers to Lloyd’s, independently of their contributions as individuals; and so liberally was their example seconded, that in the course of twelve years the fund amounted to £543,450 18s. 11d., out of which eighteen thousand persons had been relieved. Previous to the formation of the Patriotic fond, “Lloyd’s” had been the source and centre of many liberal subscriptions, particularly in [1794] and [1798]; in the former year upwards of £21,000 was raised tor the sufferers in Lord Howe’s victory, and in the latter £32,000 for the widows, orphans, etc. of the battle of the Nile.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

Lloyds Coffee House on Wikipedia

Lloyds of London

The Bank of England – Part VII

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Part VII of our series on the origins of the Bank of England – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – Part VII

The affairs of the Bank of England are managed by a governor, deputy-governor, and twenty-four directors, who are chosen annually. The duties are not only arduous, but of great responsibility, when it is considered that, independent of their own business in discounts, the interest on a debt of nearly eight hundred millions is paid in the Bank, and that with such regularity, that at the time when the pressure of our finances was the heaviest, not a creditor of the state had to call twice for his dividend, although nearly the whole of Europe was receiving millions from us annually, either as loans or as subsidies.

The interest on bank stock had long been at five per cent, half yearly, but in March [1823], it was reduced to four-and-a-half, which occasioned a fall in the stock from 236 to 210; it has, however, since recovered its former price. At the same time the company entered into an arrangement with the government, to advance a sum of £13,089,419 in order to pay the military and naval pensions, on condition of receiving an annuity of £585,740 for forty-four years. A few months afterwards, the directors determined on advancing money, on mortgages, in sums of not less than £10,000 at four per cent, one of the privileges of this great corporation which has rarely been resorted to, although a short time after it resumed its first charter, a bank was proposed for the purpose, entitled the Land-Bank, but it fell among the visionary projects of the age.

The name of Abraham Newland, a faithful and trusty servant of the Bank of England, for upwards of sixty years, is so connected with it, that the historian of this great establishment would be guilty of a very culpable neglect if he omitted to notice him. Mr. Newland was a striking instance of the success of diligence and integrity. At the age of eighteen, he was appointed a junior clerk; and, it is said, added to his salary the stipend of organist at one of the churches. His appointment at the Bank was about the year 1748, and in [1782], he became chief cashier, an office which he retained until [1807], when he resigned with a splendid fortune, the fruits of honest industry. On his retirement he refused to receive the usual annuity, which is very liberal, as, indeed, are all the transactions of the bank, but the directors prevailed on him to accept a service of plate of the value of 1000 guineas. So attentive was Mr. Newland to his trust, that for a period of twenty-five years he never slept beyond the walls of the Bank of England. Mr. Newland died worth £130,000 principally obtained, says a modern historian, by various successful speculations in the funds. It appears to us rather the accumulation of a liberal and increasing salary during the long period of sixty years. For had Mr. Newland speculated in the funds, he would have violated one of the regulations of the bank, and with that early knowledge which he must ex officio have known of the operations of the government, he might have made more money than he died possessed of, in a single hour.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – Part VI

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Part VI of our series on the origins of the Bank of England – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – Part VI

The business of the Bank of England was at first carried on at Grocer’s Hall, and continued to be transacted there until the year 1734, although the increase of the establishment had long rendered larger premises desirable. At length, in 1732, it was determined to erect a new building of sufficient magnitude, and the site chosen, was the house and garden of Sir John Houblon, the first governor of the company, in Threadneedle Street. The original building has since received so many additions, that it becomes more difficult to trace the architectural than the commercial growth of the establishment. The first edifice, which formed but a small portion of the vast fabric which now constitutes the Bank of England, was raised under the direction, and according to the designs, of Mr. George Sampson, and was opened for business on the 1st of June, 1734.

This building was soon found insufficient for the increasing business of the company, and some adjoining houses and ground having been obtained, wings were added under the direction of Sir Robert Taylor. In [1788], Mr. Soane succeeded as architect to the Bank, and to him is the present building indebted for its principal ornaments, particularly the rotunda. Mr.Soane had also the re-constructing of the principal part of the interior, which he has rendered much more commodious. From Mr. Soane’s first appointment to the present time, there has scarcely a year elapsed in which he has not been engaged, either in making some addition to the building, or in re-modelling and simplifying the arrangement of the interior; nor has he yet completed his work, but has recently added what may justly be considered the most splendid portion of this noble edifice. This consists of a new wing at the east end of the Bank; the elevation forms a colonnade of six fluted Corinthian columns which connect two pavilions; the columns do not form a portico, being barely insulated from the wall. The entablature, which is surmounted with a very fine parapet, has its frieze enriched with Vitruvian fret. The whole possesses much novelty, boldness, and elegant effect.

The whole building occupies an area of nearly four acres. The centre of the south front erected by Sampson, is eighty feet long, and is of the Ionic order. The two wings, added by Sir Robert Taylor, were copied from a building by Bramante, in the Belvedere gardens at Borne, and, although neat, did not harmonize with the centre. The north and west fronts have been erected by Mr. Soane, who, in this, as well as in several other parts of the Bank, has indulged in his favourite attachment to the Grecian architecture, which he has introduced in the purest style.

It is, however, in the interior of the Bank that the skill of the architect is displayed to the greatest advantages. The rotunda, where the money-changers assemble to traffic in real or fictitious stock, is a fine octagonal room, fifty-seven feet in diameter, and covered by a dome; the whole building being of stone. It was erected in [1795], under the direction of Mr. Soane. The court room, the pay-hall, the offices for the several kinds of stock, the hall, the apartments for the accommodation of the governor, the directors, and the cashiers, with the various offices requisite for the accommodation of eleven hundred clerks, who are now employed in the Bank, are all admirably suited for the purposes for which they are constructed, and nothing can exceed the order and regularity with which the business is conducted. As a whole, however, the Bank, from its having been built at different periods, presents several architectural anomalies and incongruities, and a confusion of orders as varied as the Babel-like confusion of tongues heard in the rotunda when a sudden fluctuation in the funds has created a multitude of hopes and fears among the clamourous multitude who usually assemble there during office hours.

Over the hall of the Bank there is a curious clock, which, by communicating rods, indicates the march of time in sixteen distinct offices, where dial plates are placed; thus obviating the inconvenience which might arise in the transacting of business in the funds by the variation of different clocks.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – First Fraud Case

More on the first recorded case of fraud at the Bank of England by Mr Robert Astlett in 1803 expanding on yesterdays post.  It is taken from The History and Antiquities of London Volume 3 and published in 1839.

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The Bank of England – First Fraud Case

In the year [1803], an extraordinary instance of embezzlement and fraud was discovered at the bank, on the part of Mr. Robert Astlett, a principal cashier, and one of the most confidential servants in the company’s employ. The detection arose from circumstances communicated to the directors by Mr. Bish, the Stock-broker and Lottery-office keeper, in Cornhill, who had been engaged by Astlett to dispose of some Exchequer bills, which on examination, Mr. Bish had found to have previously passed through his own hands, and been delivered in to the Bank. It appeared in evidence, that Astlett had the custody of all Exchequer bills brought into the Bank, till a sufficient quantity was collected to arrange in bundles, and deliver to the directors in the parlour, where the bundles are counted, and a voucher for the delivery of them given to the cashier.

In conformity to this practice three bundles to the supposed amount of £700,000. had on the 26th of February, been transferred to the parlour, and the proper entry made under the signatures of two directors; yet as counting the bills, it was seen that the vouchers had been given for £200,000 more than the bundles contained. For the felonious embezzlement of three of those bills, of £1000. each, Astlett was put co his trial at the Old Bailey, on the 8th of July, when it was proved by his counsel, that the purloined bills were not valid; inasmuch as they had not been signed by a proper officer, as required by an act of parliament.

The prisoner was therefore acquitted; but he was detained in custody by order of the court, in consequence of it being stated that the bank directors intended to issue a civil process against him for £100,000 and upwards, money paid for bills, which he had converted to his own use.

On the Thursday following, July the 14th, at a half yearly general court of proprietors, (which was held at the Bank for the purpose of declaring a dividend,) the chairman entered into a detailed and satisfactory explanation of the manner in which Astlett had imposed upon the directors, and been enabled by interlining sums, and other artful contrivances, to carry on his frauds without suspicion. He also stated that the actual loss was about £320,000 a sum nearly amounting to the entire dividends of the half year; but that the affairs of the company were in so prosperous a state that they should be able to divie as usual: about £78,000. likewise, of the above sum, he expected the Bank would be able to recover.

Previously to the return of the sessions, the directors departed from their declared intention of issuing a civil process, and Astlett, on the 3rd of September, was again tried for a criminal offence. The indictment was founded on the act of the 15th of George the second, chap. 13, and he was charged with the felonious embezzlement of property and effects of the Bank of England. The same ground of objection was taken as on the former trial, against the validity of the bills, from their want of a proper official signature; but this was over-ruled by Mr. justice Le Blanc, and the jury having brought in a verdict of guilty as to the facts, the point of law was reserved for the decision of the twelve judges. That decision was pronounced at the Old Bailey, on the 16th of February, [1804], by Mr. Baron Hotham, who stated that the objection had been ably and legally discussed; but that the judges were of opinion that the bills in question came properly under the denomination of the ‘effects, meant by the statute; and that the prisoner, by having been found guilty of the embezzlement of them, was subjected to the pain of death.’ This sentence, however, was not executed, and Mr. Astlett remained a prisoner in Newgate for many years, having but lately been discharged by means of a pardon.

Excerpt from The History and Antiquities of London Volume 3 and published in 1839.

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – Part V

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Part V of our series on the origins of the Bank of England – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – Part V

It will readily be perceived that the principal business of the Bank of England is as the agent of government in the management of the public debt; and, in addition, to the allowance it has for transacting this business, considerable profit is derived from the balances which it holds belonging to the government, which have sometimes amounted to six millions. Although there can be no doubt that the profits of the Bank, for transacting the business of the government, are great, yet it is but justice to this body, the first in wealth and character that ever existed, to say that the directors, on all occasions, manifest a corresponding liberality; that their treasury has always been open when the necessities of the government required a loan, and that when, in [1798], voluntary contributions were solicited for carrying on the war, the Bank commenced the subscription by a donation of £200,000.

In nothing is the resumption of cash payments by the Bank of England more gratifying, than the service it has done to the cause of humanity, by putting a stop to that system of forgery which every year sent numerous victims to an untimely death. The forgeries were generally in notes of the lowest value, and these being entirely withdrawn, the crime has almost ceased. A singular fraud, though not fatal to the individual, yet of such an extent as would have seriously injured many establishments, was committed on the Bank, in [1803], by Mr. Robert Astlett, a principal cashier, who, by re-issuing exchequer bills, defrauded the company of £320,000. a sum nearly equal to the entire dividends of the half-year. Astlett was tried on two several indictments, and capitally convicted, but judgement was deferred; and after remaining many years in Newgate, he was pardoned by his present Majesty, on condition of quitting the country.

The Bank of England has, on several occasions, issued a silver currency to a considerable extent, sometimes in dollars, and tokens of eighteen-pence and three-shillings, at an advanced price on the value of silver. The Spanish dollars, which were successively raised from four-and-sixpence to five shillings, were, in [1811], re-issued at five-and-sixpence, having been previously re-stamped by one of Mr. Bolton’s powerful machines, which entirely effaced the Spanish insignia, and replaced it by the head of his Majesty, and a figure of Britannia.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – Part IV

 

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Part IV of our series on the origins of the Bank of England – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – Part IV

The restriction on cash payments, authorized by the privy council in 1797, and confirmed by an act of parliament, though intended as a temporary measure, was continued by various legislative acts until the month of September, [1817], when the Bank issued a notice that cash would be given for all their notes of £1 and £2 value, dated previous to the 1st of January, [1816]: so great, however, was the demand for cash, that in the course of two years, from the 1st of January, [1817], to the 1st of January, [1819], the gold coin issued amounted to £1,596,356 in guineas and half guineas, and £4,459,725 in sovereigns. Had this sum been withdrawn merely for the purpose of superseding paper money in internal circulation, it would have occasioned no uneasiness; but it was found that it was exported to France at a premium, and that in such quantities, that out of a new coinage of £5,000,000. made by the French government, nearly four millions of it was out of the coin of this country.

In order, therefore, to prevent such a drain of the precious metals, it was determined once more to interdict cash payments. After this measure was adopted, two parliamentary committees were appointed to investigate the affairs of the Bank; In the report of the secret committee of the House of Commons, dated May 6, [1819], we have a clear and decisive proof of the flourishing state of the Bank of England, fully justifying that ample confidence which the public have reposed in the stability of its resources. It appears by this parliamentary document, that the sum which the Bank was liable to be called on to pay, in fulfilment of its engagements, on the 1st of January, [1819], was £33,894,580. and that it was then in possession of government securities, and other credits, to the amount of £39,096,900. leaving a surplus in favour of the Bank of England, of £5,202,320. exclusive of the permanent debt due from government to the Company, of £14,686,800 repayable on the expiration of the charter. Thus the total capital of the Bank exceeds twenty millions sterling.

The proposal again to restrict the Bank from payments in cash, met with considerable opposition in both houses of parliament, though the usual orders of the house were suspended, that the bill might pass through all its stages in one day; and it passed through the commons on the 5th of April, [1819], and through the lords on the following day. This act, which is known by the name of Mr. Peel’s Bill, limited the restriction to the 1st May, [1822], on which day cash payments were resumed, and have continued uninterrupted, and unlimited to the present time.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – Part III

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Part III of our series on the origins of the Bank of England – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – Part III

A more imminent danger threatened the bank, which had been steadily increasing in prosperity and consequently in capital, during the fanatical riots of [1780]. Fortunately, this great establishment was not the object of attack at the commencement of those daring outrages; for, unprepared as it then was, it is almost certain that it would have been entirely despoiled.  Dr. Johnson, in his Letters to Mrs. Thrale, when giving what he calls a journal of “a week’s defiance of government,” unhesitatingly states that if the mob had attacked the bank “at the height of the panic,” on Tuesday instead of the Wednesday night, “when no resistance had been prepared, they might have carried irrecoverably away whatever they had found.”  Wilkes headed the party who drove the rioters away, and this was the first effectual resistance they encountered. Since this period, a guard of soldiers has been regularly sent every evening from the Horse Guards, or from the Tower, and lodged in the bank for its protection.

The punctuality with which the interest on the bank stock, and the dividends on government securities were paid, and the facility with which the principal is obtained, soon pointed out the funds as the most convenient, and often the most advantageous modes of investing capital, and to such an extent was this done, that in the year [1791], when government called for a return of the unclaimed dividends which had accumulated in the bank, they were found to amount to £660,000 of which half a million was advanced to government without interest.

When the French revolution, that pivot on which so much of European history turns, was extending its principles to neighbouring states, and strong symptoms of attachment to them had been, manifested in England, the stability of the government, and consequently of the bank, began to be questioned, and several persons withdrew their confidence and their money from the public funds; this had been done to such an extent, that in the year 1797, the bank felt some difficulty in obtaining the requisite quantity of specie, which had been drained out of the country by loans and subsidies, to meet the demand, The bank had also been so liberal in its advances to government, that it had felt some inconveniences on this account; but the minister still sued for aid, and the directors, though protesting against further advances, could not refuse them. At length, when the wants of the government and the demands of the public threatened to drain the bank of its last guinea, the directors sent a deputation to Mr. Pitt, then Premier, on the 24th of February, 1797, to represent the state in which they had been placed, and to ask him “how far he thought the bank might go on paying cash, and when he would think it necessary to interfere before their cash was so reduced as might be detrimental to the immediate service, of the state.” Mr. Pitt was not the minister to hesitate on such an occasion; a meeting of the Privy Council was held two days afterwards, who passed an order, declaring it necessary for the public service, that “the Directors of the Bank of England should forbear issuing any cash in payment until the sense of Parliament could he taken on the subject.”

This order was extensively circulated, accompanied by a notice from the Secretary of the bank, stating, “that the general concerns of the bank were in the most affluent and prosperous situation.” The merchants and bankers of London, with that generous confidence which has always marked their conduct, again assembled, as in the year 1745, to declare their confidence in the Bank of England, and their determination to receive bank notes on all occasions. Upwards of four thousand of the most eminent mercantile men in London signed this declaration, but the panic had spread to the country, and a great shock was given to public credit. A parliamentary committee was soon afterwards appointed to examine into the affairs of the bank, when it was ascertained that the company had a surplus of £3,826,890 beyond all their debts, exclusive of a sum of £11,686,800. due to them from government, forming a total net capital of £15,513,690.  

This assurance was deemed satisfactory, though it was some time before the funds recovered the shock they had received. In consequence of cash payments being abolished, it became necessary to substitute a paper currency in notes of smaller sums than had been hitherto issued. Until the year [1759] no bank notes of less than £20. had been circulated, but in that year, others of £10 and £15 were used; in [1790], bank notes for £5 were put in circulation, and in 1797, when it was no longer obligatory on the bank to pay in cash, notes of £1 and £2 were issued, and continued in circulation until the year [1822], when they were wholly withdrawn, and cash payments resumed, an event which sadly disconcerted political economists, who declared that a return to cash payments was totally impossible. Although in 1797, a paper succeeded a metallic currency, yet the actual amount of bank notes in circulation in the month of December in that year did not exceed those issued in February by more than two millions, and the sum was altogether less, by about three millions, than in [1795].

The run on the Bank, as the call for cash in 1797 is generally called, reduced the issues of bank notes very considerably; and at the moment that the Bank was relieved from the necessity of cash payments, the amount in circulation was only £8,601,964. From this period, however, the issues were continually augmented, and they appear to have reached their maximum in the month of August, [1817], when the Bank had actually in circulation, bank-notes and bank post bills, to the amount of £30,099,908.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – Part II

Part II of our series on the origins of the Bank of England – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – Part II

The relief of Parliament became necessary, and a new act was passed, authorizing the bank to increase its capital to £2,201,171.10s and other privileges being granted to the company, its credit was completely restored; so much so that the bank stock, which had been given in exchange for exchequer tallies, then at a discount of from forty to fifty per cent rose twelve per cent, above par. The exchequer tallies were afterwards paid off by the bank, at par, by which means many persons, who had bought them when at a great discount, amassed large fortunes: one gentleman, Sir Gilbert Heathcote, is said to have gained £60,000. by the fluctuation.

The bank had hitherto been a corporation, assisting, but not connected with the State further than in the relation of a lender to a borrower, but in the year [1706], it became the direct and immediate agent of government by undertaking to issue exchequer bills to the amount of a million and a half, which paid as in later times an interest of two-pence per diem for every £100.

The Bank of England now became prosperous; and the act passed in 1708, for preventing more than six persons engaging in a firm, though now a law of questionable policy, did much service to the company, so that in the following year, when the bank was empowered to double its capital, the sum of £2,201,171,10s was subscribed in the course of five hours, at an advance of fifteen per cent. This advance in the price of bank stock was however nothing to what took place when the South Sea bubble had frenzied the British capitalists, and bank stock was actually sold at 260 per cent.

Successive acts of Parliament were passed to enable the bank to increase its capital, and on all occasions when the government required aid, the bank was willing to accommodate it on terms of reciprocal advantage. The affairs of the company were highly prosperous, and its capital stock more than ten millions when the rebellion of 1745 threatened to paralyse its operations. In the first moment of alarm, persons became anxious to obtain cash for their notes, and crowded to the bank for that purpose. Unfortunately the bank was not at that time very well supplied with the precious metals, and certainly not, in any thing like the quantity necessary to exchange the notes issued: some expedient was necessary, and in order to gain time, the directors paid the notes in silver, and wherever they could in sixpences, which rendered the process slow and tedious. But although the demands on the bank were numerous they were not very heavy, and the merchants and bankers in London felt so assured of its stability, that eleven hundred of the most respectable signed a declaration, expressive of their confidence in the safety of the bank, and of their determination to support its credit by receiving the notes in all payments, and circulating them on all occasions.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

The Bank of England on Wikipedia 

The Bank of England Archives

The Bank of England – 1694 – Part I

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We had a ‘dig’ around in our library on the history of the Bank of England and discovered this interesting article which we will publish in several parts over the next few days – its from the book London – Volume 3 published in 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery.

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The Bank of England – 1694

It was an observation of the father of political economists,  Dr. Adam Smith, that ‘the stability of the Bank of England is equal to that of the British government’ and the history of this establishment has proved that the remark is just: it is an institution whose welfare is so intimately connected with that of the state, that they must stand or fall together; not that the State is dependent on the bank which it enriches, but that the obligation and services are reciprocal. The bank is the agency house through which the government pays the greatest portion of-its creditors, allowing a liberal sum as a compensation for the trouble, which has of late years been somewhat reduced in amount.

The origin of the banking system has been traced by more than one historian to the time of Pharoah, when Joseph gathered all the money in Egypt to the house of his master, thus manifesting a partiality for the precious metals which the descendants of his tribe and nation have preserved unimpaired to the present day. Among the moderns Venice, the cradle of European commerce, was the first to form one of those institutions, which have since been found so advantageous to its progress. The first bank in this flourishing republic was established so early as the twelfth century, when a bureau, called the Chamber of Loans, was opened for receiving the deposits of a forced contribution, which the pressing necessities of the republic rendered necessary, and paying the interest of four per cent. Such was the origin of the first national bank in Europe, which continued to flourish until the invasion of France, in 1797, when the independence of this republic was overthrown.

Venice was so much in advance of the other states of Europe in commerce, that it was long before her example was followed. Amsterdam was the next, but the bank was not established there until the year [1609]. London was still later in adopting so excellent an institution, the Bank of England not having been established until the year 1694. Not that the merchants of London were ignorant of the principles of banking, for considerable business had long been carried on in that line by private individuals, particularly the Lombard merchants. It has already been stated, [vol. 1.] p. 323.) that the goldsmiths were the first regular bankers in London, and it exhibits a singular instance of what may be termed the longevity of prosperous commerce, that the descendants of the first two bankers still carry on the business, and that, too, where they first commenced. In an old tract, printed in [1675], entitled “The Mystery of the new-fashioned Goldsmiths or Bankers discovered,” the adoption of banking in England is attributed to the distrust which was generated in the reign of Charles I, when the merchants and tradesmen, who before trusted their cash to their servants and apprentices found it no longer safe to do so; neither did they dare to leave it in the Mint at the Tower, on account of the distress of majesty itself.  It is, however, rather to be wondered at, that banks were not established long before, than that they were only adopted in the year [1645]. The first regular banker in London was Mr. Francis Child, a goldsmith, who kept a shop in Fleet-street, Temple-bar, where the business of the respectable firm of Messrs. Child and Co. is still carried on. The next bankers were Messrs. Snow and Denne, whose shop is said to have been a few doors west, and on or near the site of the banking house of Messrs. Snow and Paull.

Excerpt from London Volume 3 1824 by Sholto and Reuben Percy – Brothers of the Benedictine Monastery

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Further reading and external links

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James Watt – 1736

 

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Matthew Boulton and James Watt formed a partnership in 1773 after Boulton took a share in Watts engine as settlement of a debt.  Today they are honoured for their work in superior coinage with them both featuring on the new £50 banknote. 

Catch-up with earlier posts in this series here or search our library here.

Below is an excerpt from The Quarterly Review Volume 104 published in 1858 – featuring James Watt.

James Watt – 1736

James WattJames Watt was born at Greenock on the Clyde, on the 19th of January, 1736. His parents were of the middle class honest, ‘God-fearing’ people, with a character for probity which had descended to them from their ‘forbears,’ and was the proudest inheritance of the family. James Watt was thus emphatically well-born. His grandfather was a teacher of navigation and mathematics in the village of Cartsdyke, now part of Greenock, and dignified himself with the name of ‘Professor.’ But as Cartsdyke was as yet only a humble collection of thatched hovels, and the shipping of the Clyde was confined principally to fishing-boats, the probability is, that his lessons in navigation were of a very humble order.

He was, however, a dignitary of the place, being Bailie of the Barony as well as one of the parish elders. His son, James Watt, the father of the engineer, settled at Greenock as a carpenter and builder. Greenock was then little better than a fishing village, consisting of a single row of thatched cottages lying parallel with the sandy beach of the Frith of Clyde. The beautiful shore, broken by the long narrow sea lochs running far away among the Argyleshire hills, and now fringed with villages, villas, and mansions, was then as lonely as Glencoe; and the waters of the Frith, now daily plashed by the paddles of almost innumerable Clyde steamers, were as yet undisturbed save by the passing of an occasional Highland coble.

The prosperity of Greenock was greatly promoted by Sir John Shaw, the feudal superior, who succeeded in obtaining from the British Parliament, what the Scottish Parliament previous to the Union had refused, the privilege of constructing a harbour. Ships began after 1740 to frequent the pier, and then Mr. Watt added ship carpentering and dealing in ships’ stores to his other pursuits. He himself held shares in ships, and engaged in several foreign mercantile ventures, some of which turned out ill, and involved him in embarrassments. A great deal of miscellaneous work was executed on his premises – household furniture and ship’s carpentry – chairs and tables, figureheads and capstans, blocks, pumps, gun-carriages, and dead-eyes. The first crane erected on the Greenock pier, for the convenience of the Virginia tobacco ships, was supplied from his stores. He even undertook to repair ships’ compasses, as well as the commoner sort of nautical instruments then in use. These multifarious occupations were the result of the smallness of the place, while the business of a single calling was yet too limited to yield a competence. That Mr. Watt was a man of repute in his locality is shown by his having been elected one of the trustees to manage the funds of the borough in 1741, when Sir John Shaw divested himself of his feudal rights, and made them over to the inhabitants. Mr. Watt subsequently held office as town-treasurer, and as bailie or magistrate.

Agnes Muirhead, the bailie’s wife, and the mother of James Watt, was long remembered in the place as an intelligent woman, bountifully gifted with graces of person as well as of mind and heart. She was of a somewhat dignified appearance; and it was said that she affected a superior style of living to her neighbours.

Excerpt from The Quarterly Review Volume 104 published in 1858.


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Further Reading and External Links

BBC News – New £50 banknote – featuring Matthew Boulton and James Watt