the same time the shares of the London and Westminster Bank, in
spite of an addition of 100 per cent to the capital, have risen from
27 to 66, and the dividend from 6 per cent to 20 per cent. That the
Bank proprietors should not like to see other companies getting
richer than their company is only natural.

Some part of the lowness of the Bank dividend, and of the consequent
small value of Bank stock, is undoubtedly caused by the magnitude of
the Bank capital; but much of it is also due to the great amount of
unproductive cashof cash which yields no interestthat the Banking
Department of the Bank of England keeps lying idle. If we compare
the London and Westminster Bankwhich is the first of the joint-stock
banks in the public estimation and known to be very cautiously and
carefully managedwith the Bank of England, we shall see the
difference at once. The London and Westminster has only 13 per cent
of its liabilities lying idle. The Banking Department of the Bank of
England has over 40 per cent. So great a difference in the
management must cause, and does cause, a great difference in the
profits. Inevitably the shareholders of the Bank of England will
dislike this great difference; more or less, they will always urge
their directors to diminish (as far as possible) the unproductive
reserve, and to augment as fall as possible their own dividend.

In most banks there would be a wholesome dread restraining the
desire of the shareholders to reduce the reserve; they would fear to
impair the credit of the bank. But fortunately or unfortunately, no
one has any fear about the Bank of England. The English world at
least believes that it will not, almost that it cannot, fail. Three
times since 1844 the Banking Department has received assistance, and
would have failed without it. In 1825, the entire concern almost