Page images
PDF
EPUB

Mr. J. T.
Bristow.

7 June 1875.

Mr. William Shaw-continued. 3564. And therefore their expenses are less? -Yes.

3565. Have you stated the subscribed capital of the three northern banks ?--The subscribed capital of each is 1,000,000l., and the paid-up capital of the three is 800,000 7. The paid-up capital of the Belfast Bank is 250,000 7.

3566. How much are the reserves of that bank?£. 180,000; the Ulster Bank have 250,000 l of paid-up capital, and 250,000 7. of reserve; and the Northern Bank have 300,000 7. of paid-up capital, and 170,000 1. of reserve.

3567. What dividends have they paid for the last year? The last dividend which the Belfast Bank paid was 20 per cent.; the Ulster Bank

Mr. Mulholland-continued.

3577. Have you met with any of the nonissuing banks in any of those districts ?-We (the Northern Bank) have not.

Chairman.

3578. Have you any branch or any agency in London?-We have no branch, but we have an

agent.

3579. Do you think it desirable that you should have a branch office of your own in London? We do not consider it desirable.

Mr. Anderson.

3580. That is because your business is purely a local one?—It is principally a local one. 3581. You have not a large amount of business

paid 20 per cent, and the Northern Bank paid that culminates in London-No, the only part

15 per cent.

3568. Except the London non-issuing banks, are there any other non-issuing banks paying such dividends as that?-I do not recollect that there are.

Mr. Balfour.

3569. When you said that you kept your reserve in London, did you mean that you kept it at the Bank of England, or in the hands of bill brokers at call, or both?-We do not keep any at the Bank of England; we have no account with the Bank of England; the reserve which we have in London is kept at our own correspondents, and at bill brokers.

3570. Then do your own correspondents lend it out to bill brokers?-It is lying at our account with them at call.

Mr. Sampson Lloyd.

3571. You were asked by the honourable Member for Liverpool as regards the comparison between the dividends of banks of issue and the dividends of banks of non-issue; is not the comparison of dividends very much affected by the amourt of paid-up capital in each case?Yes.

3572. For instance, of two banks, one may have 250,000 7. of paid-up capital, and the other may have 1,000,000 7. of paid-up capital; both may do an equally profitable business, and except as regards the value of the 750,000 7. difference of capital at four per cent., or what not, the dividend may be preternaturally high in the case of the bank with the small paid-up capital, though its charges to the public may be as low as or lower than the charges of the bank with the 1,000,000 7. of paid-up capital?—Yes.

3573. Therefore, in your opinion can any fair comparision be made of the benefit to the public of issuing and non-issuing banks without taking the question of the paid-up capital into consideration in each case?—No, certainly not.

3574. In fact the benefit to the public of a bank having the privilege of issue, is that it brings into a small place the advantages of banking which without the privilege of issue that bank would not be able to afford?-That is my opinion.

Sir John Lubbock.

3575. In fact you'regard the rate of dividend as being an entirely fallacious test?-Perfectly so, I think.

Mr. Mulholland.

3576. Have you established any branches outside of Ulster?-Very few. The three banks together have established 24 branches out of Ulster.

of our business that culminates there, or at least the principal part of it, is retiring our customers' acceptances that may be payable there.

3582. Is that part of your business increasing? -It has increased; there are more local bills made payable in London now than there were a few years ago.

3583. If it increases much further in the same direction, might it not be desirable for you to establish a branch in London?—I do not think that any convenience of that kind would induce us to do it.

Chairman.

3584. Do you consider that other Irish banks establishing branches in London gain any advantage over you by so doing?-The National Bank, who have a head office in London, are enabled to transfer money from Ireland to England, or vice versâ, or at least they do transfer money at a lower cost than the other banks do.

3585. Do you consider that that gives them an advantage over you?-It gives them an advantage if the opening of an establishment in London does not cost them more than they get by it.

3586. Do you consider that it is equally open to you to do it as it is to them?-I believe that there is nothing to prevent our doing it.

3587. But although that gives them an advantage, you do not think that you would gain enough by doing it to compensate for the expense of establishing a branch in London ?The amount of our London business is not at all such as would lead us to think of it.

3588. And local business you think you can carry on quite sufficiently without a branch in London?-Yes.

Mr. Backhouse.

3589. In fact, I suppose that the charges made by London bankers for conducting youraccounts are less than the cost would be of establishing and maintaining a branch in London? -I believe they are,

Mr. William Shaw.

3590. About half your flax, I believe, is foreign flax?-It varies very much from year to year.

3591. And almost all the payments for that are made in London, are they not?-Almost all the payments for that are made in London.

3592. And you think, on the whole, that it pays you better not to attempt to establish a branch in London ?-We think so.

Mr. Mundella.

3593. But supposing that you saw it to be to your interest

Mr. Mundella-continued. interest to establish a branch in London, you are not aware of anything that should prevent your doing so?-I am not aware of anything.

Mr. Willlam Shaw.

3594. Except the dangers and difficulties of London business, which might frighten you?Yes; but there is no impossibility, and nothing to prevent our doing it if we wished it.

Mr. Mulholland.

3595. Your chief reason for that conclusion, I suppose, is that you are able to employ all your capital and deposits locally?—Yes.

3596. If they increased very much, so that you could not employ them locally, that might alter your opinion, I presume?-It might.

Sir John Lubbock.

3597. You could employ them quite easily in

Sir John Lubbock-confinued. London by correspondents and bill brokers, could you not?-We can quite well now.

3598. Do you consider that a good deal of responsibility would be involved in opening an office in London ?-There would be a good deal of responsibility and a good deal of risk.

3599. And you think that such a business would not be so conveniently managed by a local board sitting in the North of Ireland ?-We think not, as it should be managed.

3600. On the other hand, if the board sat in London you would consider that the local dislocal board?-We think that the directors or trict was not likely to be so well served as by a managers ought to be as near the centre of their operations as possible.

Mr. Balfour.

3601. Do you get any interest upon the money which you have with your agents at call?-It is a matter of arrangement.

Mr. J. T.
Bristow.

7 June 1875.

z 2

[blocks in formation]

Mr. Readman.

10 June 1875.

Mr. GEORGE READMAN, called in; and Examined.

Chairman.

3602. ARE you the Manager of the Clydesdale Bank?-I am.

3603. What is the constitution of that bank; is it constituted under Royal Charter?-No, under contract of co-partnery.

3604. How long has that bank been in existence ?-Since 1838.

3605. What is the capital of the bank?£. 1,000,000 now.

3606. What was it originally ?-It was always 1,000,000 l.; but it was not always all paid-up. 3607. It is now all paid-up, is it?-Yes.

3608. Has the bank many branches?-We have altogether 79 branches.

3609. Does that include the branches in England?-Three in Cumberland.

3610. What has been the progress of the bank in late years in throwing out branches; has it thrown out many branches within the last 10 or 12 years? When I joined the bank in 1852, we had only 11 branches. Since that time we have had amalgamations with two other banks; and besides these, after the failure of the Western

Bank in 1857, by a kind of arrangement with them, or, at all events, with the concurrence of the liquidators, we got a good many of their

branches.

3611. You amalgamated with two other banks, besides taking up the branches of the Western Bank? Some of them, but not all.

3612. What were the two banks which you amalgamated with?-The Edinburgh and Glasgow Bank in 1858, and the Eastern Bank in 1863.

3613. Does your bank chiefly do business with a particular portion of Scotland, or is it fairly spread over the whole country?-It is chiefly in the west of Scotland, in the neighbourhood of Edinburgh, and as far north as Montrose, but not north of Montrose or Brechin. We have no branches in the extreme north of Scotland.

3614. Can you say that you are connected with any particular classes of business?-Our business is very general.

[blocks in formation]

3616. The question had not been mooted before that?-Not exactly in Cumberland. We had the question of opening branches in England under consideration for a great many years.

3617. When did you first have under consideration the question of opening branches in England? It is so far back as 20 years.

3618. That was in 1855 ?-That was in 1855.

3619. Why did you not open them then?There were a number of reasons which induced us not to open them. While we had the matter under consideration, and before we were prepared to act, the failure of the Western Bank occurred; and we had a very large accession of business from that cause. In the following year the Edinburgh and Glasgow Bank was united with brought us another accession of business. us, and later on the Eastern Bank, and that I may

also mention that in 1864 and 1867 two other banks established themselves in London, and they having begun in London we thought we would just look on and see how they succeeded.

3620. Then your reason for not proceeding to open branches in England was that you found that you had enough on your hands, and you did had any reason to think that there would be legal not wish to begin that extension, and not that you or other difficulties in the way?-We were satisfied that there were no legal difficulties at that time.

3621. Did you inquire into your legal position with regard to England at that time?—Yes.

3622. Did you take counsel's opinion?-We took counsel's opinion of both the English and Scotch Bars.

3623. Have you any opinions or evidence that you could give the Committee with regard to the legality or otherwise of your establishing branches in England?-The two counsel, whose opinions we asked, were Sir Roundell Palmer in England, and Mr. Moncrieff (who, I think, was then Lord Advocate, at all events, the present Lord Moncrieff) in Scotland. I have searched for the

3615. When was it that you began to consider Moncrieff) in Scotland.

opinion

Chairman-continued.

opinion of Lord Moncrieff, but I cannot find it; but I have the other. There are some points in it connected with the internal management of the bank, and the interpretation of our own contract, but I am quite willing to put it in.

Mr. Orr Ewing.

3624. What is the date of that?-Sir Roundell Palmer's opinion is dated the 27th November 1855. (The same was delivered in, vide Appendix.) I can put in also the contract of co-partnery, if the Committee desire it.

Chairman.

3625. Will you state what were the inducements which led you to open branches in Cumberland?-We have a very extensive connection in Glasgow and the West of Scotland with the iron trade and with large ironmasters; nearly all of whom have establishments in Cumberland. It was suggested to us that it would be a venience to them, and an advantage to ourselves, if we had branches in that district. In addition to that there is considerable intercourse between the opposite shores of the Solway Frith; we have several branches in Dumfrieshire and in Wigtonshire. Lastly, we were led to understand that there was a very large Scotch population scattered along the shores of Cumberland. Those were the inducements that led us to entertain the proposition.

3626. How many branches have you opened in Cumberland ?-Three.

3627. Will you state where they are?-Carlisle, Workington, and Whitehaven.

3628. What kind of business have you done there?—The ordinary general banking business, receiving money, and when we think fit, lending it out.

3629. Have you ever issued Scotch notes there?--Never; not one.

3630. Have you taken in notes of Scotch banks there? We have.

3631. Have you made any charge or commission upon them?—We have not charged anything to our own customers bringing Scotch notes; but we have charged to strangers.

3632. What commission have you charged ?3 s. 6 d. per cent., much the same as the commission on a document payable in Scotland. 3633. Much the same as you would charge if anybody brought you a cheque upon the Royal

Bank?-Yes.

3634. Can you state what amount you have received in that way?-Yes. I have returns here from three branches, from two of them in perfect detail, but from the third one, which is not a very large one, not so perfect. I will state the figures of each if you choose. At Carlisle, between the 7th of February 1874, and the 8th of June, the present month, we have taken in 903 11. notes of our own bank, and 1,235 l. in 5 l. notes and upwards of our own bank. In 17. notes of other Scotch banks, in the same period, we have taken in 10,376 l., and in notes of other Scotch banks of 51. and upwards, 14,540 l.; making a total sum, at Carlisle, of 27,054 1. At Workington in the same period, we took in eight 1. notes of our own bank, and 1107. in notes of 5 l. and upwards; 313 1. notes of other Scotch banks, and 150 l. in notes of 5 l. and upwards of other banks; making a total of 581 7. In Whitehaven, up to the 24th of April last, they had not

Chairman-continued.

kept a distinct account, but the total sum of every kind of note was 1,883 l.; and as an instance that they are not different from the others, I may mention that between the 24th of April and the 8th of June the notes of the Clydesdale Bank received at Whitehaven were 14 1 7. notes, and 190 l. in notes of 5 l. and upwards; 107 1 7. notes of other banks, and 75 7. in notes of 5 1. and upwards of other banks; making a total of 386 l. The total of the whole is 29,470 l.; and I may mention that at Whitehaven and Workington most of our notes come from other banks in the place and not from the public.

Mr. Goschen.

3635. Could you state what proportion of those notes came from your customers?-The whole thing is such a bagatelle that we have not paid much atttention to it.

Mr. Orr Ewing.

3636. What proportion did you receive from other banks?—Taking the case of Workington, for instance, I think that from the 7th of February 1874 to the 24th of April, there were eight 1. notes of the Clydesdale Bank, one of which came from another bank; and 105 7. out of the 1107. in notes of 5 1. and upwards, came in the same way from other banks.

3637. Did you charge the banker a commission in those cases?-I cannot say, but I almost think not.

3638. In the event of your not having had a branch there, what would have become of those 17. notes? If they did not give them away themselves they would send them to us or to some other banker in Edinburgh or Glasgow.

3639. It is a convenience to the other banks that you are there to receive them?-Yes, but it is really a very small affair altogether.

Mr. Goschen.

3640. Is it considered a convenience by the other banks, so far as you know, that you have such a very small matter, that I think it would established yourselves in Cumberland?—It is

not enter into their calculation.

3641. But is it considered a convenience by the other banks?-I think that Mr. Orr Ewing meant simply as regards these notes; it saved them the risk of sending through the post. considered a convenience by the other banks?— 3642. But have you ever heard that it was I never heard it mooted one way or the other.

Mr. Orr Ewing.

3643. The convenience was not considered so great that they would ask you to establish a branch there ?-No.

Mr. Goschen.

3644. Do you cash bills upon Scotland to any extent ?-Not to any great extent. 3645. Not to an extent equal to that of the notes ?-Yes, very much greater.

3646. Have you any details with regard to the bills which you have cashed?—I have not. 3647. What would you charge on those bills? -The same rate as we charge in Glasgow.

3648. What would you charge to your customers on Scotch bills?-The same rates as we should charge to any of our customers in Scotland.

3649. Would there be any agency charged to

Mr. Readman.

10 June
1875.

Mr. Readman.

10 June
1875.

Mr. Goschen-continued. your customers for cashing bills on Scotch banks? -We never cash bills on Scotch banks.

3650. Do you make any charges on bills on Glasgow and Scotch traders? They would be treated in every respect as if they were cashed in Scotland.

3651. Would your customers have an advantage, as regards bills on Scotland, in doing the business through you, as compared with doing it through an English bank?-I cannot tell what the English bank charges are.

3652. Supposing that there were there were a bill of 5,000 7. on Glasgow in the hands of some one at Carlisle, would he have an advantage in paying it through your agency as compared with paying it through an English bank?-He would have the advantage if our rates were lower than the English rates, but I do not know what the English

[blocks in formation]

Chairman-continued.

business in Scotland?—No, I think that we are in the same position.

3663. It is open to any of those banks to establish a branch in Scotland, if it pleases?—I understand so. We have no issue in England.

3664. But you consider, do you not, that you have the right of having a branch in London?The opinion which I have put in says so, and we think so.

3665. But you consider that these five joint stock banks would not have that right?-As I understand the law they would not if they had an issue.

3666. Therefore you are on a footing of advantage as compared with them, are you not, in respect of your being able to go to London, which they are not able to do?-They are at a disadvantage as compared with us, I think.

Sir John Lubbock.

3667. When you pay one of your own 17. notes I think I understood you to say that you make a small charge; would you mind saying what it is?-3 s. 6 d. per cent.

3668. How do you charge that upon a 1 note?-I suppose it is about d.; if a gentleman, as sometimes happens, returning from Scotlaud, came into our bank in Carlisle and said, “I have got two or three Scotch notes, will you be kind enough to change them for sovereigns?" If we knew anything about him we would take them; I do not suppose that we should charge d. each for them, but the charge is 3 s. 6 d. per cent. for any amount.

3669. And that is your usual charge in fact?Yes, to others than our own customers.

Mr. Campbell-Bannerman.

3670. I presume that the same gentleman going into one of the Cumberland banks with his two or three Scotch 1 7. notes would be treated in the same way?—I do not know it, but I should be very much surprised if they did not do it.

pays

your

Sir John Lubbock.

3671. If a customer of yours in Cumberland into bank a cheque drawn upon one of the Scotch banks, do you make him a charge for collecting it?-My impression is that we do, but it is one of those details which it is impossible that I can carry in my mind.

3672. As between your Cumberland branch and your Glasgow branch I presume that the Glasgow branch would make no charge upon the Cumberland branch for paying a cheque drawn upon it?-Yes, we should unless it were paid to the party himself.

3673. I understood you to say that the Cumberland branch of your bank would make a charge to your customer, but would the Glasgow branch of your bank make a charge to the Cumberland branch of your bank for paying a cheque drawn upon it?-That is a cheque upon ourselves, and we would not make any charge; but if a person came to the bank in Glasgow with a cheque upon Cumberland, we should make a charge upon him for cashing that cheque, and I have no doubt that it would be vice versa.

3674. But if your Cumberland branch received a cheque drawn upon one of your branches over the Border, your branch over the Border would make no charge to your Cumberland branch for

paying

« PreviousContinue »