AMSTERDAM, Bank of. This insti tution was established in 1609, much upon the plan of the Bank of Venice. Its chief and at first its only function was that of affording payment for bills of exchange drawn upon the merchants of that great commercial port, in full-weighted coins; the coins in common cir culation being more or less below standard by reason of attrition, filing, sweating or other means of degradation. In order to give effect to the plan of the bank, the municipal law pro vided that all bills of exchange above 600 guilders should be payable only at the bank. Its capital consisted entirely of its customers' deposits, whose desire to meet their bills promptly induced them tolceep a sufficient bal ance at the bank for that purpose. The city guaranteed the solvency of the bank; and to guard against mismanagement appointed its principal officers and made frequent examina tions of its accounts. For this guarantee the bank charged the depositor and paid the city 10 guilders for each account opened, besides other small. fees on transfers, amounting in the agregate to between 150,000 and 200,000 guild ers per annum. money)) usually com
manded a premium or agio of 5 to 9 per cent in circulating money, the agio representing the difference between newly minted coins and those in circulation. It was the common belief that. for every guilder represented by the bank's receipts or acknowledgments for de posits there was a metallic guilder in the vaults of the bank, so that it appears to have made no loans and indulged in no enterprises or specu lations. In 1672 when the French King Louis XIV was at Utrecht, the bank paid in coins, which, by the marks of fire upon them, must have lain in its vaults more than half a century. However, upon the second French invasion, 1793, the bank was found to be entirely desti tute of money, the deposits having been drawn down and concealed for greater safety. After a useful career of more than two centuries the bank was wound up in 1820. For the his tory of other ancient banks see list under the heading BANKS, ANCIENT AND MODERN.