The most important civic event in the reign of William was the foundation of the Bank of England. The bankers of the City had been, as we have seen, the goldsmiths, who not only received and kept money for their customers, but lent it out, for them and for themselves, on interest. Thus, when Charles the Second, on January 2, 1672, closed the Exchequer, his creditors could obtain neither principal nor interest. He then owed the goldsmiths of London the sum of £1,328,526. Some of the older banks of London trace a descent to the goldsmiths of the seventeenth century—Child’s, for instance, Hoare’s, and others.
A PERSPECTIVE VIEW OF THE BANK OF ENGLAND, 1743
From Maitland’s History and Survey of London.
The idea of a National Bank seems to have been considered and discussed for some years before it was carried into effect. The principal advocate of the scheme was a Scotchman named William Anderson. The advantages which he put forward in defence of the Bank were the support of public credit and the relief of the Government from the ruinous terms upon which supplies were then raised. There was great difficulty in getting the scheme considered, but it was at last passed by an Act of Parliament in 1693. By the terms of this Act it was provided that the Government should take a loan of £1,200,000 from the Bank, this amount to be subscribed; additional taxes were imposed which would produce about £140,000 a year, out of which the Bank was to receive £100,000 a year, including interest at 8 per cent, and £4000 a year for management. The Company was empowered to purchase lands, and to deal in bills of exchange and gold and silver bullion, but not to buy or sell merchandise, though they might sell unredeemed goods on which they had made advances.
The subscription for the £1,200,000 was completed in ten days. The Bank began its business on July 27, 1694.
Its offices were at first the Grocers’ Hall, where they continued until the year 1743. In this year the new building, part of the present edifice, was completed.
Maitland describes it as
“A most magnificent structure; the front next the street is about 80 feet in length, adorned with columns, entablature, etc., of the Ionick order. There is a handsome courtyard between this and the main building, which, like the other, is of stone, and adorned with pillars, pilasters, entablature, and triangular pediment of the Corinthian Order. The hall is 79 feet in length, and 40 in breadth, is wainscotted about 8 feet high, has a fine fretwork ceiling, and a large Venetian window at the west end of it. Beyond this is another quadrangle, with an arcade on the east and west sides of it: and on the north is the Accomptant’s Office, which is 60 feet long, and 28 feet broad. There are handsome apartments over this and the other sides of the quadrangle, with a fine staircase adorned with fretwork; and under it are large vaults, that have very strong walls and iron gates for the p reservation of the cash.”
By the charter they constituted a Governor, who must have £4000 in Bank stock; a Deputy Governor, who must have £3000; and twenty-four Directors, who must have £2000 each.