Viewed in its banking department, the Bank differs from other banks in having, the manage ment of the public debt, and paying the dividends on it; in holding the deposits belonging to the Government, and making advances to it when necessary; in aiding in the collection of the public revenue, and in being the bank of other banks. For the management of the public debt, the Bank receives about £247,000, against which there has to be set £124,000 of charges. The remaining profits of the Bank are derived from its use of its deposits, on which it allows no in terest. and of its own capital. The capital was originally £1,200,000; in 1816 it reached £14, 553,000—the present amount. There is besides a reserve of about £3,200,000. In Deoembcr, 1901, the public deposits were £10,493,177, and the private were £39,460,027 ; the maximum of de posits, public and private, is about £50,000,000.
to 1797, the Bank, being on the verge of bank ruptcy, was ordered by the Government to sus pend the redemption of its notes in coin, and the notes became the main currency of the nation, until the resumption of specie payments in 1821. The notes during this interval not having been eonvertible into coin on demand, there was no Cheek upon the Bank in the amount of its issues; and the currency became depreciated. It is, however, said that the value of gold at the time was enhanced owing to absorption by hoarding and by military-chests, and that the depreciation was more apparent than real. The export of gold following on a rise of prices occasioned by an issue of bank or Government notes is un limited, except by exhaustion, if these notes are not payable in coin on demand, and are issued without any check from without or self-imposed.
But as prices estimated in these notes rise, the price of bullion, like other commodities, rises too, and the price of coin which can be converted into bullion, or be used abroad at its previous purchasing power, rises also. Since 1821 the Bank has more than once been on the verge of a suspension of payments, owing to foreign drains of gold. The separation of the Bank into two departments is regarded by many as having a tendency to produce a suspension in times of panic, when the reserve is reduced by with drawals to supply a foreign drain, or to meet an internal run. Before the separation, the Bank, in the case of withdrawals of gold, had the whole amount of gold within its vaults to meet them; but now it loses the command of all the gold in the issue department. It cannot get that gold unlees in exchange for notes, but, its reserve being reduced or exhausted, it has none to spare. The restriction of credit con sequent upon the approach to an exhaustion of the reserve of the banking department, is so great that the fear of it occasions a panic; and in 1847, 1857, and 1866, on the possible suspen sion of payments by the banking department, owing to a reduction of its reserve, being ap parent, the Government of the day took the re sponsibility of authorizing the Bank to lend ad ditional notes, not represented by gold, which was an indirect way of getting at the gold in tho issue department, where the object of the bor rowers was to obtain gold. The Bank of Eng land is situated in the centre of London; but it has two branches in the metropolis and nine brandies in the provinces.