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THE BANK OF ENGLAND A HISTORY IN TWO VOLUMES VOLUME II CAMBRIDGE UNIVERSITY PRESS LONDON: BENTLEY HOUSE NEW YORK TORONTO BOMBAY CALCUTT A MADRAS: MACMILLAN Copyrighted in the United States of America by The Macmillan Company All rights reserved GEO RGE WARDE NORMAN Dire•tor ISzi-1872 THE BANK OF ENGLAND eA History BY SIR JOHN CLAPHAM C.B.E., Lrn.D., F.B.A. VOLUME II 1797-1914 With an Epilogue: THE BANK AS IT IS · CAMBRIDGE AT THE UNIVERSITY PRESS 1944 PRINTED lN GREAT BRITAIN CONTENTS Chapter I. The Years of Suspended Cash Payments, 1797- 1811 page I II. From the Resumption of Cash Payment to the Charter Act of ISH · 75 III. Between two Charter Acts, I8H-I844 13I IV. The DecadeJollowing the Act of 1844 and the Crisis of 1847 I86 V. War, Gold and Crises, 1854-I866 12.1 VI. The New Environment, 187e>-90 171 VII. From the Baring Crisis to the South Mrican War, I 890 to I 899 340 VIII. The Bank in the Early Twentieth Century 375 Epilogue: the Bank as it is 4I7 Appendices A. Half·yearly dividend on Bank Stock, 1788- 1943 B. Bank Rate, 1797-1914 C. Income from the Discounts, 1797-1915 D. Income from Short 'Loans and Advances, 1847-I914 435 E. Bankers' Balances at the Bank, 1878-I913 436 F. Gladstone and the Bank, I854 437 Graphs 440 Index 443 vii PLATES George Warde Norman, Director 182.1-1872 Frontispiece William Manning, Governor 1812-1814 jacingp. 36 John Gellibrand Hubbard, Governor 1853-1855 , 174 Henry Lancelot Holland, Governor 1865-1867 , \X'illiam Lidderdale, Governor 1889-1892 , SOURCES AND REFERENCES, VOL. II The main MS. sources-Court Books, Ledgers, etc.-are the same as for Vol. I, and the same style of reference is used. A much greater number of miscellaneous MS. sources is, however, available at the Bank than for the eighteenth century. These, when used, are described in full in the footnotes. Some small use is made of the Gladstone MSS. The Peel MSS. contain nothing of imporci.nce, but fortunately Peel's relations with the Bank are fully recorded there in 1844 Comspondence (seep. 178 seq.). The shortened references to Journals etc. are the same as in Vol. 1. APPENDICES A-F APPENDIX A Half-Yearly Dividend on Bank Stock, 1788-1943 1788-1805 ;! and;! 1872. 4! and 5 1805, Oct. St 1873 4i and 5! t8o6 ;! and 8! 1874 . 5 and 5 1807-2.2. 5 and 5 1875-76 4! and 4! I8a3-38 4 and 4 I 1877 5 and 41 1839-47, April ;! and 3! 1878 4i and 4! 1847-48 4! and 4! 1879 5! and 4i 1848, Oct. 3! x88o-81 4! and d 1849 5! and 3! 188z 5! and 5! I85o-52. 4 and 31 188; 5! and 5 1853 4 and 4· t884 5 andd 1854 4! and 4! 1885 5 and 5 1855 4 and 4 t886 4! and 4i 1856 5 and 41 t887 5 and 4! 1857 4! and 5! 1888 S and 5 1858 51 and 41 1889 5! and 5 1859 4 and 41 1890 5! and 5! 186o 4! and 5 1891 s! and 5! · 1861 5 and 5 1892. 5 and 5 186z 4! and 4! 1893 4i and 5 1863 4! and 4! 1894 4! and 4 t864 5! and 5! 1895 4! and 4 x865 51 and 5 1896 4! and 4! 1866 5! and 61 1897-1903 5 and 5 1867 51 and 4! 1904-13 4! and 41 t868 - 4 and 4 1914-2.1 5 and 5 . t869-70 4! and 4! 192.2. 6 and 51 1871 41 andd 192.3-43 6 and 6 Note: Steady dividends aimed at before 1847 and from 1897: the inter- vening half-century is that of maximum competitive activity and fluctuating dividends. 429 APPENDIX B Bank Rate, 1797-1914 1797 5 1855 5 April 4! 186o 24 4 18z2 2.0 June 4 3 May 4 8 Nov." 4! I8z5 13 Dec. 5 I4 June ;! 13 , 5 I8z7 S July 4 6 Sept. 4 IS , 6 1836 2.1 4! I3 4! 29 " 5 I Sebt." 5 27 ", 5 31 Dec. 6 1838 IS Fe . 4 4 Oct; s! 1861 7 Jan. 7 1839 I6May 5 I8 , 6 or 1t 14 Feb. 8 10 June st 1856 uMay 6 2.I March 7 1 Aug. 6 2.9 , 5 4 April 6 I84o 13 Jan. 5 2.6 June 4! II , 5 t 841 7 April 4 1 Oct. 5 t6 May 6 1844 5 Sept. 1! and;* 6 , 6 or 1t I Aug. 5 1845 13 March 1! 13 Nov. 7 IS , 4! 16 Oct. 3 4 Dec. 6t 19 , 4 6 Nov. ;! 18 6 19 Sept. ;! t846 27 Aug. 3 t8S7 2 April" 6! 7Nov. 3 1847 14 Jan. ;! t8 June 6 1861 9 Jan. 2t :u 4 16 July st 12 May 3 8 April" 5 8 Oct. 6 10 July 1! 5 Aug. st u 7 24 , z ;o Sept. " 8 ;o Oct. 6t 19 " 3 25 Oct. 8 5 Nov. 9 I86; 15 Jan. 4 uNov. 7 9 IO 18 5 1 Dec. 6 14 Dec." 8 19 Feb." 4 23 " 5 t8s8 7 Jan. 6 13 April ;t 1848 27 Jan. 4 14 5 ;o , 3 IS June ;t 18 " 4 t6 May ;! 2 Nov. ; 4 Feb." ;t 11 4 1849 22. ,, 1! II 3 z Nov." 5 t8so 16 Dec. 3 9 Dec." z! 5 6 1852 I Jan. 1! 1859 2.8 April ;t z Dec." 7 u. April 1 5 May 4! 3 , 8 1853 6 Jan. 1! 1 June ;t 24 , 7 20 ; " 9 , 3 1864 20 Jan. 8 1 June ;t 14 July zt II Feb. 7 1 Sept. 4 t86o 19 Jan. 3 zs 6 IS , 4! 31 4 t6 April" 7 29 ,, 5 2.9 March" 4! z.May 8 1854 II May s! u April 5 5 , 9 3 Aug. 5 10 May 4! 19 , 8 * Bills zt, Notes ;. t I month bills 5!· t 6crday at 6. 430 APPENDIX B 1864 z.6May 7 1869 4 Nov. 3 1873 2.9 Sept. 5 x6 June 6 1870 11 July ;t 14 Oct. 6 15 July 7 2.3 , 4 t8 , 7 4Aug. 8 18 , 5 I Nov. 8 8 Sept. 9 4Aug. 6 7 , 9 xo Nov. 8 II 5t 10 , 8 14 7 t8 " 4t 17 , 6 15 Dec." 6 15 " 4 4Dec. 5 1865 12. Jan. 5t I Sept." ;t II 5! z.6 , 5 15 , 3 1874 8 Jan." 4 1 March4t 29 " 1t 15 ;t 30 , 4 1871 2. March 3 ;o April" 4 4May 4! x; April 1! z.8 May ;t 15 4 13 July 2. 4 June 3 I June" 3! 2.1 Sept. 3 x8 , z.t z.8 ;o July 15 3 " 4 3 17 July" ;t 7 Oct. 5 6Aug. 4 16 Nov. 20 3 Aug. 4 4 " 3t 2.8 Sept. 4t ;o ;t 27 ,, 3 1 Oct. 5 14 Dec." 3 15 Oct. 4 5 , 6 '1871 4 April 3! x6 Nov. 5 7 , 7 it 4 ;o 6 13 Nov. 6 9May" 5 1875 7 Jan." 1 28 Dec. 7 ;o , 4 14 , 4 x866 4 Jan. 8 13 June 3! 18 , 3 22. Feb. 7 20 , 3 18 Feb. 3! 15 March 6 .18 July 31 8 July 3 3 May 7 x8 Sept. 4 29 " 1! 8 8 26 , 4t u Aug. 2 II " 9 3 Oct. 5 7 Oct. 2! 12. " 10 10 6 14 " 3! x6 Aug." 8 9Nov." 7 2.I , 4 2.3 7 z.8 , 6 18 Nov. 3 30 " 6 u Dec. 5 ;o Dec. 4 6 Sept." 5 1873 9 Jan. 4! 1876 6 Jan. 5 27 , 4! z.; ,, 4 17 , 4 8 Nov. 4 30 , 3! 13 March ;t 20 Dec. 3! z.6 March4 6 April 3 1 1867 7 Feb. 3 7 May 4t 10 " ;o May z.t 10 , 5 t877 3 May 3 15 July 1 17 , 6 5July 1! x868 19 Nov. z.t 4 June 7 12. 2 3 Dec. 3 12. , 6 28 Aug." 3 x869 I April 4 10 July 5 4 Oct. 4 6 May 4! 17 4! II 5 10 June 4 24 ", 4 29 Nov." 4 24 ;t 31 ;t 1878 xo Jan. 3 15 July" 3 11 Aug." ; ·3 I , 2. 19 Aug. 2! 15 Sept. 4 18 March 3 APPENDIX B 431 1S7S ;o May zt ISS6 zo June zt 1S91 2.9 Oct. 4 2.7 June ; a6Aug. ;t zo Dec. 3! 4 July 3! az Oct. 4 1S9z ZI Jan, 3 I Aug. 4 z6 Dec. s 7 April 2! IZ s tSS7 ; Feb. 4 zS z 14 Oct." 6 to March ;t 20 Oct." 3 uNov. s 24 ; I893 z6 Jan. zt IS79 16 Jan. 4 14 April" 2! 4May 3 30 , 3 2S ,, 2 II , 3! 13 March zt 4Aug. 3 IS 4 Io April z I Sept. 4 8 June" 3 6 Nov. 3 I8SS u Jan. 3! IS 2! tSSo 17 June 2! 19 3 3 Aug." 3 9 Dec. 3 I6 Feb." zt IO , 4 tS8t 13 Jan. ;t IS March z 2.4 , 5 17 Feb. 3 10 May 3 14 Sept. 4 18 April zt 7 June zt ZI , 3! IS Aug, 3 9 Aug. 3 5 Oct. 3 25 , 4 13 Sept. 4 1S94 z Feb.