reserve; but though the practice is mended the theory is not. There
has never been a distinct resolution passed by the Directors of the
Bank of England, and communicated by them to the public, stating
even in the most general manner, how much reserve they mean to keep
or how much they do not mean, or by what principle in this important
matter they will be guided.

The position of the Bank directors is indeed most singular. On the
one side a great city opinion--a great national opinion, I may say,
for the nation has learnt much from many panics--requires the
directors to keep a large reserve. The newspapers, on behalf of the
nation, are always warning the directors to keep it, and watching
that they do keep it; but, on the other hand, another less visible
but equally constant pressure pushes the directors in exactly the
reverse way, and inclines them to diminish the reserve.

This is the natural desire of all directors to make a good dividend
for their shareholders. The more money lying idle the less,
_caeteris paribus_, is the dividend; the less money lying idle the
greater is the dividend. And at almost every meeting of the
proprietors of the Bank of England, there is a conversation on this
subject. Some proprietor says that he does not see why so much money
is kept idle, and hints that the dividend ought to be more.

Indeed, it cannot be wondered at that the Bank proprietors do not
quite like their position. Theirs is the oldest bank in the City,
but their profits do not increase, while those of other banks most
rapidly increase. In 1844, the dividend on the stock of the Bank of
England was 7 per cent, and the price of the stock itself 212; the
dividend now is 9 per cent, and the price of the stock 232. But in