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new phase in banking, such as the mutual principle, or division of profits with the customers of the bank, without involving the latter in any partnership liability, or allowing interest on current accounts to the customers of the bank, in order to induce parties to take shares,such stipulations, unless subsequently rescinded by a majority of shareholders, at a meeting specially appointed for that purpose, must be carried out in all their integrity, or the directors of the bank will be liable to have a Bill in Chancery filed against them.
11. By statute 30 Vict., c. 29 (17th June, 1867), all agreements made after the 1st of July, 1867, for the sale or transfer of any shares, stock, or interest in any joint stock banking company in Great Britain or Ireland (except the Bank of England and the Bank of Ireland), issuing stock or shares transferable by writing, shall set forth such shares, stock, or interest by the numbers by which the same are then distinguished on the register or books of the company, and, if there is no register or books, then the agreement is to set forth the person or persons in whose name or names such shares, stock, or interest shall then be standing.
Any person, whether principal or not, who knowingly inserts in the contract any false number or name as aforesaid is guilty of a criminal offence.
12. Companies are bound to show the list of shareholders to any registered shareholder during business hours, from ten to four o'clock.
OF THE LAWS, CUSTOMS, AND PRACTICES OF BANKING IN IRELAND.
1. Bank of Ireland similar in principle to Bank of England.
2. Restrictions upon the Bank of Ireland.
4. Agents of the Bank of Ireland, regulation respecting. 5. On the general legal restrictions upon Banking in Ireland.
6. Deeds of settlement prevent shareholders interfering with the business of Banks.
7. On the Irish Bank Act of 1845.
8. Irish Joint-Stock Banks do not publish any statement of their affairs.
1. The Bank of Ireland, like the Bank of Scotland, was established by Act of Parliament; its capital, like that of the Bank of England, was lent to the Government, and in consideration thereof the bank obtained the exclusive privilege of banking, as far, at least, as to prevent the formation of banks of more than six partners; this part of the Act is repealed, and public banks may now be established in Ireland.*
2. The bank is prohibited from discounting bills of exchange at a higher rate than 5 per cent. per annum. The corporation is also prohibited, under certain restrictions,
*The business of the bank is conducted in what was formerly the Parliament House. In the room where the Lords met, surrounded by a tapestry depicting the battle of the Boyne, the shareholders and directors hold their periodical meetings.
from purchasing lands of the Crown or from lending any money by way of loan upon anticipation of any branch of the public revenue, under penalty of double the sum lent.
In case any judgment is obtained against the bank by any person, he may take the execution to the officers of the exchequer, who are authorised to deduct the amount of the said judgment from the sum annually paid to the corporation for transacting Government busi
Forging the notes of the Bank of Ireland is made felony without the benefit of clergy.
3. In case of insolvency of the bank, the stock is to be first applied to pay the debts of the corporation; and if not sufficient each member is liable till the whole be paid.
The Bank of Ireland, like the Bank of England, does not allow interest to depositors; and being to a certain extent the Government bankers, they deem it their duty to give every possible facility to the investment in the Government funds, of the savings of the country.
They buy, sell, and transfer public funds, for persons in any part of Ireland, on the same terms as if those parties were personally present in Dublin, and employed a broker to do it. When the dividends become payable in Dublin, they pay them to the proprietors of stock in the most distant parts of Ireland by means of their several branches.
4. All the agents and sub-agents of the Bank of Ireland are furnished with a copy of general instructions, the original of which they sign; these instructions embrace a variety of points of general practice, and are divided into a number of rules under separate heads, distinguishing the duties of the agents, sub-agents, and clerks; they contain besides minute regulations for the safe custody of the bank property generally, the keeping of the accounts, the conduct of the general banking business, and the management of discounts under every variety of circumstances that general rules can embrace. The latter subject, of course, calls for continual advice and instruction, and constantly occupies the attention of the directors in Dublin.
5. There are various legal restrictions in connection with banking in Ireland which are not in force in any other part of the United Kingdom; such restrictions had their origin from the numerous disastrous failures which took place in that country about a century ago.
The following are a few of the disadvantages an Irish Bank has to contend against:
Every mortgage which a banker may effect must be registered one month after the date of its execution.* All grants, sales, alienations, and leases of real or leasehold estate, which are made by a banker to his son or grandson, his daughter or grand-daughter, though given for a valuable consideration, are void as against claims on the banker by his creditors.
A banker may assign to his brother, but a father cannot assign to his son even for a valuable consideration, although the creditor, who claims that the assignment shall be void, was not a creditor at the time it was made.
So that by this law a person, while he continues a banker, cannot make a marriage settlement upon a son or daughter, so as to be good against a creditor; in fact, it would appear that such a law, which is still in force, was framed for the purpose of preventing persons from becoming bankers.
Notes, negotiable receipts, or accountable receipts, with any promise or engagement therein contained for the payment of any interest, may not be issued by any banker. All such notes are absolutely void as against a banker's estate.
It is illegal for a banker in Ireland to give any receipt for the deposit of cash in the bank bearing interest. Some joint-stock banks, to avoid the penalties of such a law, give receipts for deposits, and put the conditions for payment of the interest on the back of the receipt, that mode being supposed not to come within the meaning of the words "therein contained."
There is another provision affecting Irish bankers which is considered oppressive, viz.: That if a banker fails, and cannot pay the principal of his obligations, he must pay legal interest for them.
6. The deeds of partnership of some of the banks of But the provisions of 21 & 22 Geo. III, by which the Bank of Ireland was prevented from lending on mortgage, are repealed by 23 & 24 Vict., c. 31, § 1.
Ireland, contain clauses absolutely prohibiting the shareholders from interfering in any manner whatever with the business transactions of the bank; it is a system of entire confidence on the part of the shareholders in the directors, whose appointments are permanent.
The directors of most of the banks are paid salaries, like other officers, and are prevented from entering into any other business.
7. The Joint-Stock Bank Act of 1845, fixes the interest to be paid to the Bank of Ireland, in respect to its capital advanced to the Government, appointing the bank sole manager of the public debt of Ireland, and to pay dividends thereon without expense to Government.
Bank of England notes are not a legal tender in Ireland, nor, in fact, are any notes. Those banks who claim to issue notes must give notice to the Commissioners of Stamps, &c., who fix the amount each bank is to issue.
Weekly returns are to be made of the amount of the notes of each bank in circulation, and of gold coin held by any banker.
Notes for a less sum than 20s. not legally negotiable in Ireland, and all notes for 20s. and above, and less than £5, to be drawn in accordance with a prescribed form.
No other parties, other than the bankers, are to issue notes payable on demand for less than £5, under a penalty of £20.
All joint-stock banks may sue and be sued in the name of the public officer of the bank.
8. The joint-stock banks of Ireland do not publish any periodical reports of their condition; they call their proprietors together and submit a short statement to the meeting, which sometimes appears in the newspapers, and that is the only means the public have of knowing anything about them.
A bank, however high it may stand in public estimation, which seeks the protection of the Crown, and obtains the important privilege not only of issuing notes payable to bearer on demand, but of securing its members against any liability beyond the amount of its joint stock or fund, ought not to content itself by satisfying the scruples, if any, of its own members when assembled at a meeting, to which the public have no access; but should, for its