FRANCE, The Bank of. Before the Bank of France was established all attempts which had been made to create a fiduciary circulation had ended in ruinous failures. The last and most disastrous experience had been the creation of assignats in 1789 by the Assemblee Constituante. The assignats were government currency notes issued on the security of the Biens Nationaux (estates of the clergy), pending the sale of the latter. The assignats were to be canceled when returning to the coffers of the treasury; in fact they were left in circulation, multiplied without any control, until one day their value was measured only by their weight of paper. When that financial catastrophe occurred the disasters that attended Law's plans (under the reign of Louis XV in 1716), were still alive in the minds of the people. It is, therefore, easy to understand that the very name of bank ing was discredited when, in 1800, Bonaparte, being at that time First Consul, decided to es tablish a great issuing bank to serve the inter ests of the state and of trade as well. A corn was created under the name of Banque de rance just as an ordinary joint-stock company th an original capital of 30,0043,000 francs.
The capital was increased to 45,000,000 francs 1803, when the bank first began to enjoy the exclusive privilege of issuing national bank notes; then to 91,000,000 francs in 1848 and Finally to 182,500,000 francs in 1857. The capital as not been increased since that time. The shares are of a nominal value of 1,000 francs and they were quoted on the Paris Bourse at over 5,000 francs (in January 1917).
Although all the shares are nominative (the French capitalists having a marked preference for bear shares and bonds), and in spite of the fact that their price increases in a constant and steady manner, the shareholders have never ceased to grow in number. For the same amount of shares there were in 1860, 13,767 holders; in 1880, 27,136 holders; in 1909, 31,249 holders; in 1915, 33,453, holders.
In order to understand how popular are these shares with the general public it must be kept in mind that one-third of the holders do not possess more than one share each and that 50 per cent have no more than two shares each.
The Bank of France was given a charter at first for only 15 years. Before that period expired, the privilege was renewed for another period of 25 years and has always been renewed be fore expiration. The last renewal of the charter was granted by the state in 1897; it is to expire on 31 Dec. 1920, but it will of course be prolonged for another period.
Internal Organization.—At the beginning the bank was governed by 200 of the largest shareholders (each of them having only one vote), who elected the Conseil General, that is to say, the board of directors entrusted with the management. This Conseil General con sisted of 18 members, 15 of them being regents (directors) and the three other Censeurs (su pervisors). A committee of three regents was then selected by the Conseil General to act as Managing directors. In 1806 Napoleon (he had then become emperor), decided that the management of the bank should be invested in a nominee of the government. He accord ingly selected the three members form ing the Committee of Managing Directors, that is to say, the governor and the two deputy governors. That organization has lasted till tb-day. The governor and the two deputy governors are always appointed by the govern ment. The latter is also a national bank, inas much as it has no branch whatever in foreign countries, not even in the French colonies which have their own and independent banks of issue. At the beginning it was to be only a Parisian bank, but the area of its operations was by de grees extended to the whole of France where there are now 143 succursales (branches) in the principal towns. Besides, 75 sub-offices (bureaux auxiliaires) have been established in minor centres, whilst in 365 other localities (villes rattachies), selected among the most im portant, all drafts and bills, payable in these localities, are collected by the bank at par. (Altogether 583 banking places).