Firth at the mouth of the Deveron. It is well built, carries on some
boat-building, and has ropeworks, a brewery, &c., fishing and shipping.
Near the town are the county lunatic asylum, and Duff House, a seat of the
Duke of Fife, now public property; on the east side of the Deveron is the
town of Macduff, where an extensive fishing trade is carried on. Banff is
one of the Elgin burghs, which together return a member to Parliament. Pop.
3517.--The county has an area of 403,053 acres. In the south it is
mountainous; but the northern part is comparatively low and fertile;
principal rivers, the Spey and Deveron; principal mountains, Cairngorm
(4095 feet) and Ben Macdhui (4296 feet), on its southern boundary. Little
wheat is raised, the principal crops being barley, oats, turnips, and
potatoes. Fishing is an important industry; as is also the distilling of
whisky. Serpentine abounds in several places, especially at Portsoy, where
it is known as 'Portsoy marble', and Scotch topazes or cairngorm stones are
found on the mountains in the south. Banffshire returns one member to
Parliament. Pop. (1921), 57,293.
BANFF, a town of N. W. Canada, at the foot of the Rocky Mountains, on the
Canadian Pacific Railway, with National Park, hot springs, coal-mines, &c.
BANG. See _Bhang_.
BANGALORE', a town of Hindustan, capital of Mysore, and giving its name to
a considerable district in the east of Mysore State. The town stands on a
healthy plateau 3000 feet above sea-level, has a total area of nearly 14
sq. miles, and is one of the pleasantest British stations in India. In the
old town stands the fort, reconstructed by Hyder Ali in 1761, and taken by
Lord Cornwallis in 1791. Under English administration the town has greatly
prospered in recent times. There are manufactures of silks, cotton cloth,
carpets, gold and silver lace, &c. Pop. 189,485.--The Bangalore district
has an area of 3070 sq. miles, of which more than half represent cultivable
land. Pop. about 760,000.
BANGKOK', or BANKOK, the capital of the kingdom of Siam, extending for
several miles on both sides of the Menam, which falls into the Gulf of Siam
about 15 miles below. The inner city occupies an island surrounded with
walls and bastions, and contains the palace of the king and other important
buildings. The dwellings of the common people are of wood or bamboo, often
raised on piles; a large portion of the population, however, dwell in boats
or wooden houses erected on bamboo rafts moored in the river, and forming a
floating town. Temples are numerous and lavishly decorated. Houses in the
European style have been erected in modern times, and the telegraph,
telephone, gas, fire-engines, and omnibuses introduced. A university with
eight faculties has recently been established. The trade, both inland and
foreign, is very extensive, the exports consisting chiefly of rice, sugar,
silk, cotton, tobacco, pepper, sesame, ivory, aromatic wood, cabinet woods,
tin, hides, &c.; and the imports consisting chiefly of British cotton,
woollen, and other goods. Pop. 628,675, of whom about a half are Chinese.
See _Siam_.
BAN'GOR, a city of North Wales, in Carnarvonshire, picturesquely situated
near the northern entrance of the Menai Strait. It appears to have
possessed a cathedral in the sixth century, which was destroyed by the
Normans in 1071. The present cathedral--the third--only dates from the
reign of Henry VII. It has a college of the University of Wales (founded in
1903), and a Normal College. Bangor has risen into importance as a popular
resort; its principal trade is in the export of slates from the
neighbouring quarries. Pop. (1921), 11,032.
BAN'GOR, a seaport town, Ireland, County Down, on the south side of Belfast
Lough. Principal trade: cotton, linen, and embroideries. Pop. 7776.
BAN'GOR, a port of the United States, in Maine, on the W. side of Penobscot
River, a flourishing and pleasantly-situated town, and one of the largest
lumber depots in the world. The river is navigable to the town for vessels
of the largest size. Pop. (1920), 25,948.
BANGO'RIAN CONTROVERSY, a controversy stirred up by a sermon preached
before George I in 1717 by Dr. Hoadly, Bishop of Bangor, from the text "My
kingdom is not of this world" (_John_, xviii, 36), in which the bishop
contended in the most pronounced manner for the spiritual nature of
Christ's kingdom. The controversy was carried on with great heat for many
years, and resulted in an enormous collection of pamphlets.
BANGS'RING. See _Banxring_.
BANGWEO'LO, or BANGWEULU, LAKE, in South Africa, the southernmost of the
great lake reservoirs of the Congo, heard of in 1798, was reached by
Livingstone in 1868, an oval-shaped shallow sheet of water, said to be 150
miles in length along its greater axis, from east to west, and about 75
miles in width, but its exact limits are uncertain. It was first
circumnavigated by Poulett Weatherley in 1896. See _Congo_.
BAN'IAN, or BAN'YAN, an Indian trader or merchant, one engaged in commerce
generally, but more particularly one of the great traders of Western India,
as in the seaports of Bombay, Kurrachee, &c., who carry on a large trade by
means of caravans with the interior of Asia, and with Africa by vessels.
They form a class of the Vaisya caste, wear a peculiar dress, and are
strict in the observance of fasts and in abstaining from the use of flesh.
Hence, _Banian days_, days in which sailors in the navy had no flesh meat
served out to them. Banian days are now abolished, but the term is still
applied to days of poor fare.
BANIAN TREE. See _Banyan_.
BA'NIM, John, an Irish novelist, dramatist, and poet, born in 1798, died
1842. His chief early work was a poem, _The Celt's Paradise_ (1821). Having
settled in London, he made various contributions to magazines and to the
stage; but his fame rests on his novels, particularly the _O'Hara Tales_,
in which Irish life is admirably portrayed. In these, as in some of his
other publications, his brother, Michael Banim (born 1796, died 1874), had
an important share, if not an equal claim to praise. The two brothers have
been justly called 'the first national novelists of Ireland'.
BANISHMENT. See _Exile_.
BAN'JARMASSIN, a district and town in the south-east of Borneo, under the
government of the Dutch. The town is situated on an arm of the Banjar,
about 14 miles above its mouth, in a marshy locality, the houses being
built on piles, and many of them on rafts. Exports: pepper, benzoin,
bezoar, ratans, dragon's-blood, birds'-nests, &c.; imports: rice, salt,
sugar, opium, &c. Pop. 52,000, mostly Dyaks.
BAN'JO (a negro corruption of _bandore_; It. _pandora_, from Lat.
_pandura_, a three-stringed instrument), the favourite musical instrument
of the negroes of the Southern States of America. It is six-stringed, has a
body like a tambourine and a neck like a guitar, and is played by stopping
the strings with the fingers of the left hand and twitching or striking
them with the fingers of the right. The upper or octave string, however, is
never stopped. The banjo was introduced into England in 1846.
BANJOEMAS (b[.a]n'yoe-m[.a]s), a town in Java, near the centre of the
island, well built and of commercial importance; it is 22 miles from the
coast, and is the residence of a Dutch governor. Pop. 6500.
BANKING AND BANKS. Banks are establishments for the deposit, custody, and
repayment on demand of money, and obtain the bulk of their profits from the
investment of sums thus derived and not in immediate demand. The term is a
derivative of the _banco_ or bench of the early Italian money-dealers,
being analogous in its origin to the terms _trapez[=i]tai_ (_trapeza_, a
bench or table) applied to the ancient Greek money-changers, and _mensarii_
(_mensa_, a table) applied to the public bankers of Rome.
In respect of constitution there is a broad division of banks into public
and private; public banks including such establishments as are under any
special state or municipal control or patronage, or whose capital is in the
form of stock or shares which are bought and sold in the open market;
private banks embracing those which are carried on by one or more
individuals without special authority or charter and under the laws
regulating ordinary trading companies. In respect of function three kinds
of banks may be discriminated: (1) banks of deposit merely, receiving and
returning money at the convenience of depositors; (2) banks of discount or
loan, borrowing money on deposit and lending it in the discount of
promissory notes, bills of exchange, and negotiable securities; (3) banks
of circulation or issue, which give currency to promissory notes of their
own, payable to bearer and serving as a medium of exchange within the
sphere of their banking operations. The more highly-organized banks
discharge all three functions, but all modern banks unite the two first.
For the successful working of a banking establishment certain resources
other than the deposits are of course necessary, and the capital paid up by
shareholders on their shares and forming the substantial portion of their
claim to public credit is held upon a different footing from the sums
received from depositors. It is usually considered that for sound banking
this capital should not be traded with for the purpose of making gain in
the same way as the moneys deposited in the bank; and it is for the most
part invested in Government or other securities subject to little
fluctuation in value and readily convertible into money. But in any case
prudence demands that a _reserve_ be kept sufficient to meet all probable
requirements of customers in event of commercial crises or minor panics.
The reserve of the banking department of the Bank of England is always in
coin, or in notes against which an equivalent value of coin and bullion is
lying in the issue department. In other English banks the reserve is
usually kept partly in gold and partly in Government stocks and Bank of
England notes; but it sometimes lies as a deposit in the Bank of England.
The working capital proper of a bank is constituted by moneys on deposit,
for which the bank may or may not pay interest; the advantages of security,
of ease in the transmission of payments, &c., being regarded in the cases
of banks little affected by competition as a sufficient return to the
depositor. Thus the Bank of England pays no interest on deposits, while the
contrary practice has prevailed in Scotland since 1729, where interest is
paid on deposits although not on current accounts.
Of the methods of making profit upon the money of depositors, one of the
most common is to advance it in the discounting of bills of exchange not
having long periods (seldom more than three months with the Bank of
England) to run; the banker receiving the amounts of the bills from the
acceptors when the bills arrive at maturity. Loans or advances are also
often made by bankers upon exchequer bills or other Government securities,
on railway debentures or the stock of public companies of various kinds, as
well as upon goods lying in public warehouses, the dock-warrant or
certificate of ownership being transferred to the banker in security. In
the case of a well-established credit they may be advanced upon notes of
hand without other security. Money is less commonly advanced by bankers
upon mortgages on land, in which the money loaned is almost invariably
locked up for a number of years. To banks of issue a further source of
profit is open in their note circulation, inasmuch as the bank is enabled
to lend these notes, or promises to pay, as if they were so much money and
to receive interest on the loan accordingly, as well as to make a
profitable use of the money or property that may be received in exchange
for its notes, so long as the latter remain in circulation. It is obvious,
however, that this interest on its loaned notes may not run over a very
extended period, in that the person to whom they are issued may at once
return them to the bank to lie there as a deposit and so may actually draw
interest on them from the bank of issue; or he may present them to be
exchanged for coin, or by putting them at once into circulation may ensure
a certain number speedily finding their way back through other hands or
other banks to the establishment from which he received them. A
considerable number of the notes issued will, however, be retained in
circulation at the convenience of the public as a medium of exchange; and
on this circulating portion a clear profit accrues. This rapid return of
notes through other banks, &c., in exchange for portions of the reserve of
the issuing bank, is one of the restraints upon an issue of notes in excess
of the ability of the bank to meet them. In the United Kingdom a more
obvious restraint upon an unlimited note issue, originating partly in a
desire for greater security, partly in the belief that the note
augmentation of the currency might lead to harmful economic results in its
influence upon prices, is to be found in the Bank Acts of 1844 and 1845,
which impose upon banks of issue the necessity of keeping an equivalent in
gold for all notes issued beyond a certain fixed amount. The wisdom of
these legal restrictions, which are not uniform throughout the kingdom, and
the desirability of the acquisition and control by the State of the whole
business of issue, are still matters of debate.
In specific relation to his customer the banker occupies the position of
debtor to creditor, holding money which the customer may demand at any time
in whole or in part by means of a cheque payable at sight on presentation
during banking hours. For the refusal to cash a cheque from the erroneous
supposition that he has no funds of his customer's in his hands, or for
misleading statements respecting the position in which the bank stands, the
banker is legally responsible. Moreover, the law regards him as bound to
know his customer's signature, and the loss falls upon him in event of his
cashing a forged cheque. In their relations to the community, the chief
services rendered by banks are the following: By receiving deposits of
money they are the means by which the surplus capital of one part of a
country is transferred to another where it may be advantageously employed
in stimulating industry; they enable vast and numerous money transactions
to be carried on without the intervention of coin or notes at all, thus
obviating trouble, risk, and expense. The mechanism by which the last of
these benefits is secured is to be found in perfection in the London
Clearing House.
The modern tendency of banks is towards amalgamation. The large English
banking institutions have absorbed many of the smaller banks. They have
also made working arrangements with Scotch and Irish banks and with similar
institutions abroad.
The result of these amalgamations is to give control of immense financial
resources to a smaller number of banks. In 1918 the Government appointed a
Committee to inquire into the effect of such amalgamations and absorptions.
The terms of reference were: "To consider and report to what extent, if at
all, amalgamations between banks may affect prejudicially the interests of
the industrial and mercantile community, and whether it is desirable that
legislation should be introduced to prohibit such amalgamations or to
provide safeguards under which they might continue to be permitted"; and
the Committee reported: "That legislation be passed requiring that the
prior approval of the Government must be obtained before any amalgamations
are announced or carried into effect".
In order, however, that such legislation may not have the effect of
producing secret amalgamations, the Committee decided that "all proposals
for agreements which would alter the status of a bank as regards its
separate entity and control, or for purchase by one bank of the shares of
another bank, be also submitted for the prior approval of the Government
before they are carried out".
Another development is the registration of the British Overseas Bank,
Limited, with a nominal capital of L5,000,000. The principal object of this
institution is to carry on general banking business in all parts of the
world. Four banks--two English, one Scotch, and one having connections with
South America--are financially interested in the Overseas Bank.
Banking operations on a considerable scale appear to have been conducted by
the ancients, and recent excavations have proved that in the seventh
century B.C. banking was practised at Bagdad by a firm of Egibi & Sons.
Modern banking, however, must be regarded as having had an independent
origin in the reviving civilization of the Middle Ages. In the twelfth
century almost the whole trade of Europe was in the hands of the Italian
cities, and it was in these that the need of bankers was first felt. The
earliest public bank, that of Venice, established in 1171 and existing down
to the dissolution of the Republic in 1797, was for some time a bank of
deposit only, the Government being responsible for the deposits, and the
whole capital being in effect a public loan. In the early periods of the
operations of this bank deposits could not be withdrawn, but the depositor
had a credit at the bank to the amount deposited, this credit being
transferable to another person in place of money payment. Subsequently
deposits were allowed to be withdrawn, the original system proving
inconvenient outside the Venetian boundaries. It is, however, less from the
Bank of Venice than from the Florentine bankers of the thirteenth and
fourteenth centuries that modern banking specially dates, the magnitude of
their operations being indicated by the fact that between 1430 and 1433, 76
bankers of Florence issued on loan nearly 5,000,000 gold florins. The Bank
of St. George at Genoa also furnished a striking chapter in financial
history. The important Bank of Amsterdam, taken by Adam Smith as a type of
the older banks, was established in 1509, and owed its origin to the
fluctuation and uncertainty induced by the clipped and worn currency. The
object of the institution (established under guarantee of the city) was to
give a certain and unquestionable value to a bill on Amsterdam; and for
this purpose the various coins were received in deposit at the bank at
their real value in standard coin, less a small charge for recoinage and
expense of management. For the amount deposited a credit was opened on the
books of the bank, by the transfer of which payments could be made, this
so-called _bank money_ being of uniform value as representing money at the
mint standard. It bore, therefore, an _agio_ or premium above the worn-coin
currency, and it was legally compulsory to make all payments of 600
guilders and upwards in bank money. The deposits were supposed to remain in
the coffers of the bank, but they were secretly traded with in the
eighteenth century till the collapse of the bank in 1790. Banks of a
similar character were established at Nuremberg and other towns, the most
important being the Bank of Hamburg, founded in 1619. In England there was
no corresponding institution, the London merchants being in the habit of
lodging their money at the Mint in the Tower, until Charles I appropriated
the whole of it (L200,000) in 1640. Thenceforth they lodged it with the
goldsmiths, who began to do banking business in a small way, encouraging
deposits by allowing interest for their use, lending money for short
periods, discounting bills, &c. The bank-note was first invented and issued
in 1690 by the Bank of Stockholm, founded by Palmstruck in 1688, and one of
the most successful of banking establishments. About the same time the
banks of England and Scotland began to take shape, opening up a new era in
the financing of commerce and industry.
_Bank of England._--The Bank of England, the most important banking
establishment in the world, was projected by William Paterson, who was
afterwards the promoter of the disastrous Darien scheme. It was the first
public bank in the United Kingdom, and was chartered in 1694 by an Act
which, among other things, secured certain recompenses to such persons as
should advance the sum of L1,500,000 towards carrying on the war against
France. Subscribers to the loan became, under the Act, stockholders, to the
amount of their respective subscriptions, in the capital stock of a
corporation, denominated the _Governor and Company of the Bank of England_.
The company thus formed advanced to the Government L1,200,000 at an
interest of 8 per cent--the Government making an additional bonus or
allowance to the bank of L4000 annually for the management of this loan
(which, in fact, constituted the capital of the bank), and for settling the
interest and making transfers, &c., among the various stockholders. This
bank, like that of Venice, was thus originally an engine of the Government,
and not a mere commercial establishment. Its capital has been added to from
time to time, the original capital of L1,200,000 having increased to
L14,553,000 in 1816, since which no further augmentation has taken place.
There exists besides, however, a variable 'rest' of over L3,000,000. The
charter of the bank was originally granted for eleven years certain, or
till a year's notice after 1st Aug., 1705. It was subsequently renewed for
various periods in 1697, 1708, 1713, 1742, 1764, 1781, 1800, 1833, and
1844, certain conditions which the bank had to fulfil being specified at
each renewal. On this last occasion it was continued till twelve months'
notice from 1855. At the same time the issue department of the bank was
established as distinct from the general banking department, the sole
business entrusted to the former being the issue of notes. By this
arrangement the bank was authorized to issue notes to the value of
L14,000,000 upon securities specially set apart, the most important of the
securities being the sum of L11,015,100 due to the bank by the Government,
together with so much of the coin and bullion then held by the bank as was
not required by the banking department. The bank has since been permitted
to increase its issue on securities to L18,450,000, but for every note that
the issue department may issue beyond the total sum of L18,450,000 an
equivalent amount of coin or bullion must be paid into the coffers of the
bank. For its special privileges the bank has to pay to the Government an
annual sum of L180,000, and the profit derived from the issue of notes
beyond L14,000,000. The Bank of England notes are practically equivalent to
gold. They are (like all English bank-notes) of the value of L5 and
upwards, and are legal tender throughout England. Notes once issued by the
bank and returned to it are not reissued but are destroyed--a system
adopted in order to facilitate the keeping of an account of the numbers of
the notes in circulation, and so prevent forgery. On 7th Aug., 1914,
Government notes for L1, and ten shillings, were issued convertible into
gold at the Bank of England.
In compliance also with the Bank Charter Act of 1844 the bank is compelled
to publish a weekly account, of which the following is a specimen:--
_Dr_. ISSUE DEPARTMENT. Week ending 11th August, 1920 _Cr_.
Notes issued L139,980,460 | Government debt L11,015,100
| Other securities 7,434,900
| Gold coin and bullion 121,530,460
| Silver bullion ---
------------ | ------------
L139,980,460 | L139,980,460
_Dr_. BANKING DEPARTMENT _Cr_.
Capital L14,553,000 | Government securities L68,250,449
Rest 3,458,795 | Other securities 73,805,565
Public deposits 15,999,059 | Notes 14,452,665
Other deposits 124,018,988 | Gold and silver coin 1,537,092
Seven-day and other 15,929 |
bills ------------ | ------------
L158,045,771 | L158,045,771