THE BOURSE, PARIS.
Since the establishment of the national banking system 5171 banks have been organized, of which 1224 have gone into liquidation, 368 have become insolvent, and 3579 are in operation (February 4, 1899).
There is a marked falling off in the number of new national banks organized in recent years. In 1890 there were 307 organized, but in 1898 there were only 50 organizations reported, and that was the highest number reported since 1893. The capital of the national banks is also decreasing, but the deposits show a large increase.
At present the State banks are gaining in numbers more rapidly than the national banks.
BANK OF ENGLAND, LONDON.
Profit on National Bank Circulation.—Many suppose that national banks make an undue profit on the privilege they have of issuing notes to circulate as money, based on a deposit of bonds with the United States treasurer. Official figures disprove this. The total national bank notes outstanding, February 4, 1899, was $203,636,184.50. The law permits these banks to issue notes to the extent of 90 per cent of their capital. This capital, on February 4, 1899, was $608,301,245. Therefore they might have had notes at issue on that date to the amount of $545,871,120.50, instead of only $203,636,184.50. This is conclusive evidence that there is no substantial profit in the issuing of such notes.
In the figures furnished by the Comptroller of the Currency for 1898, he shows that the profit which a national bank could make by taking out circulation on a deposit of $100,000 of United States bonds, on October 31, 1898, was less than 1 per cent. On that date eight leading banks had no circulating notes at all out. The meagre profits of national banks explain why they do not supply an adequate paper currency. The restrictions on them make it impossible to render any substantial assistance to business in this respect. This is especially true in times of panic. Possessing gigantic strength, they are compelled to see the industries of the country attacked by doubt and distrust, and are unable to go to their aid because of the restraints which forbid them to exercise their legitimate functions.