BANKING. The banking system of the mon archy is quite simple. It centres in the Austro Hungarian Bank, with headquarters at Vienna and Budapest, 71 branches in the principal cities of the country, and agencies in many other towns. This bank has the exclusive privilege of issuing paper money, and to that extent exercises even a more complete control over the monetary situation of the monarchy than the Bank of England does over that country. It was organized in 1316, under the name of the "Austrian National Bank." and from the beginning was endowed with the great powers it now enjoys. Except for the period lasting from 1848 till the middle of the sixties, when the country's resources were drained to exhaustion by the ravages of the Revolution and foreign wars, it has enjoyed great prosperity during its entire existence, and has had a high reputation for stability and sound management. In 1877 it was recog nized as the Austro-Hungarian Bank, in order to bring it into conformity with the new political status of the country. The capital of the bank is fixed at $36,540,000, and the resources have been growing all the time, as the following figures (taken at the close of the respective years) will show: The most important bank next to the Austro Hungarian Bank is the Austrian Credit Bank for Trade and Industry (Oosterrciehische Credit Anstalt far Handel mind Gcalerbe). Its func tions are the same as those of the large private banking-houses of the United States; viz., the promotion of all kinds of industrial undertak ings, and negotiating State and provincial loans. It was founded in 1855, with an authorized capi tal of $40,000,000, which was subsequently re duced to $16,000,000, and has branches in the largest cities of the country. Among the other im portant banks should he mentioned: The Lower Austrian Discount Company, organized 1853 ($4,000.000) ; the Anglo-Austrian Bank, organ ized 1864, capital $7,000,000; the Austrian Ter ritorial Bank (Liinderbank ), organized 1880, with 4:16,000,000, mostly French capital, invested in railways, mines, and foreign loans; the Union Bank; and the General Austrian Mortgage Bank (Bodenkredit-Anstalt ), organized 1864. The lat ter advances loans on real estate by issuing mort gage bonds, which are sold in the open market, so that it practically serves as an intermediary be tween the real-estate owners and the capitalist who does the actual advancing of money. Its use fulness to the former is in securing for him a lower rate of interest than lie would otherwise have to pay, and to the latter in that it as sumes the responsibility for the solvency of the debtor. It has proved an extremely useful institution, attracting a large amount of capital from abroad (chiefly France), and dis tributing it in the agricultural community has stood in need of it most. Nearly all
of these banks have branches throughout the country, thus extending their usefulness as far as possible. An account of the banking system of Austria would not be complete without men tioning the Vienna Clearing-House (Giro nod Cassen-Verein), which, in addition to attend ing to ordinary clearing-house transactions (see CLumum-HOUSE), performs many other ser vices for banks and business firms. The growth of its transactions is shown by the following few figures: Annual Clearings 1873 $1,129,100,000 1880 2,369,200,000 1890 2,536,197,000 1894 3,293,633,000 In addition to the banks enumerated, there are a number of other banks of minor impor tance—savings, pawning, mortgage banks, etc. All in all, there are 44 joint-stock banks (be sides branches and agencies) and 17 private banks in Austria, with a capital stock of more than $120,000,000. The comparatively small number of banks in the country is due to the fact that in Austria the system of branch bank ing is in vogue. In Hungary the system of small independent banks is more in favor, there being in 1900, 360 banks, with a total capital of about $77,000,000.
The postal savings-bank system has attained a fuller development in Austria-Hungary than in any other country. Besides the savings de partment proper, in which deposits are accept ed for the smallest amounts, there is a check department, in which the minimum deposits are fixed at $40. The use of the post-office as a banking institution has proven of inestimable benefit to the business community, as the fa cilities thus afforded by the Government for out-. of-town remittances, as well as for local pay ments, are far superior to those offered by any private bank. The postal savings department has thus been converted into a gigantic clear inghouse for the entire country. The relative importance of the two departments is shown by the following figures: The number of de positors in the savings department proper in creased from an annual average of 783,208 in ISS3-90, to L527,265 in 1900; their deposits in creased during the same period from $8,500,000 to $26,000,000. In the check department the number of depositors increased during the same period from 17,SOS to 40,271, while the deposits increased from $14,000,000 to $41,000,000. The number of postal savings-banks in Hungary ex ceeded 4,200 at the end of the century, having 389,000 depositors and over $6,000.000 deposits. The private savings-banks numbered 550 in Aus tria, with more than 3,000,000 depositors; over $720,000,000 in deposits, and 731 banks in Dungary, with about $300,000 in deposits.