NORTH-COUNTRY BANKING.*
THE debt that civilisation owes to banks and bankers is seldom recognised. Without the development of the banking system, the enormous advance that has been accomplished in the matter of human comfort and general well-being would have been absolutely impossible. It is hard now to imagine a state of things in which cheques and bills of exchange are non-existent,—so hard, in fact, that it is at once evident that the world, as we know it could not have come into being without them. Naturally enough, therefore, just as children accept their parents' kindness as part of the eternal order of things, and grumble because they are not more indulgent, so the world in general regards banks as pedantic and disobliging institutions with ridiculous prejudices on the subject of over- drafts, while economic writers and financial journalists are ever railing at them because they do not keep large enough reserves of cash, and because they have the temerity to regard the interests of their shareholders and proprietors as • A History of Banks, Bankers, and Banking, in Northumberland, Durham, and North Yorkshire. By liaberly Phillips. London: Effingham Wilson and Co.
at least equally important with those of the public at large. Nevertheless, it is not too much to say that the nameless, patient workers who brought our banking system to its present state of perfection have struck a harder and more effective blow in the cause of civilisation and English greatness than all the statesmen and soldiers who decorate the pages of history with their glories and mar the interior of Westminster Abbey with their effigies.
Mr. Maberly Phillips has devoted his work to the history of banking in the Northern English counties, tracing the development of the various banks from their origin to the present day if they have had the good fortune to survive, or to the date of their collapse. Most of his facts and figures are of course interesting only to experts, and to those connected with the institutions treated of; but the writer's antiquarian taste and keen relish for an anecdote have enabled him to serve up a dry carcase of dull detail copiously seasoned with entertaining side-issues. He does
not confine himself strictly either to the period— 1755 to, 1894—or to the territory with which the work is said to deal. On the contrary, some of the most interesting parts of his book are concerned with the development of Scotch banking and the history of the Bank of England. He does not trace the beginnings of banking to the Bank of St. George at
Genoa, nor does he attempt to define the legitimate functions of banks. He contents himself with referring to the fact that in the Middle Ages banking was in the hands of the Jews, who developed the art by inventing "bills of exchange and similar modes of transferring values without the aid of coin." The life of the medimval banker must have been un- pleasantly exciting, for apart from the usual trade risk, he was always in danger of being drawn and quartered by his impecunious customers, who chose this simple an efficacious short cut when they wished to start afresh
with mete tabuix. We read that they were wont to deposit securities for advances in public buildings, and
"it is related that at the general massacre of the Jews at York, in the early part of the reign of Richard I., the gentry of the neighbourhood, who were all indebted to the Jews, ran, to the cathedral, the place where their bonds were kept, an made a solemn bonfire of the papers before the altar." Coming down to more recent days, Mr. Phillips has a good deal to tell
us about the early history of banking in Scotland, whence he- considers that the Northumbrians learnt the mysteries of the
art. There is something very grotesque, according to modern ideas, about the methods employed by rival banks to put one another in a difficulty. Bimetallists will find a new argument for their theory in the fact that in those days a bank, when pressed for cash, was able to stave off the demand by dribbling out sixpenny pieces. Here is an account of a struggle in which the Bank of Scotland and the Royal Bank of Scotland engaged with the "Glasgow Arms Bank" (Andrew Cochrane and John Murdoch) :—
"Their mode of procedure was to send to Glasgow as their' agent, Mr. Archibald Trotter, whose mission was to collect the notes of Murdoch and Co., which he presented at intervals, de- manding gold or Edinburgh notes. Mr. Trotter's polite attentions were duly weighed by the Glasgow banker, who was prepared for the occasion. Payment was not refused, but was delayed in all con- ceivable ways. Mr. Trotter has left a record of the affair, and says :—` When their notes were presented at the office for pay- ment a Bag of Sixpences was with great deliberation produced and laid upon the table ; the Teller then proceeded with ridiculous slowness to open up the Bag and Count the Money. He would first Tell over a pound sterling, in Single Sixpences, ranked upon the table, and then affecting to be uncertain about the Reckoning,. he would gather this small money and count it over again with One hand to the Other, sometimes letting fall a Sixpence for ai Pretence, to begin anew and count it over again : on other occasions he would make Time by ridiculous discourses upon the odd size or shape of Particular Sixpences, Sound another upon the Table, to try if it was sufficient coin, and some- times he would quit his occupation altogether upon Pretence of some sudden Errand or Call out of the Room. Very often, they employed one Coggill, by his ordinary occupation a. Porter, to act the Teller, and he lost time and blundered with great alacrity—being instructed to do his worst.' So the game went on ! During thirty days Trotter only got payment for notes to the value of under £1,100. This programme con- tinued for months, till= Mr. Trotter's flesh and blood could endure this treatment no longer ; ' and, accordingly, we find him in Murdoch's telling-room on 23rd January, 1759, solemnly accompanied by a notary and two witnesses. Utterly abandoned, the shameless Coggill was again set to work in the usual manner- of payment in sixpences. Some note-holders were not so well treated as Mr. Trotter, being called scoundrels by the tellers, and otherwise abused. Sometimes a beating was threatened, and one man was said to have got both a beating and payment in *sixpences. The instant the clock struck five all troublesome parties were thrust out of doors by the shoulders."
The consequent litigation revealed the remarkable fact that this enterprising bank had a capital of £15,000, and a note circulation of 2200,000. There is little wonder that it had to treat its note-holders almost as summarily as the Jewish bankers were treated by their debtors. In these early days when deposits were unknown and banks had to rely almost entirely on their note circulation for their profits, these attempts to ruin them by collecting their notes and presenting them suddenly in a large batch were common enough. In the history of the great banking firm of Backhouse and Co., we find an amusing episode of this sort
"Early in the present century some dispute arose between Lord Darlington and the Quaker Banker. The former gave notice to his tenants that they were to pay their rents in Backhouse's notes, intending to allow them to accumulate until he had col- lected a greater number than the banker could pay in gold upon sudden demand. This project of the nobleman became known to Jonathan Backhouse, who immediately posted to London, obtained a large supply of bullion, with which he hastened back to Darlington. It is reported that when passing through Croft, one of the forewbeels came off the chaise, and rather than wait to have the wheel replaced, the banker piled the gold at the back part of the chaise, so balancing the cash,' and driving into Dar- lington upon three wheels. By this sudden coup the bank was so well provided with specie that when Lord Darlington's agent presented a very large parcel of notes, they were all promptly cashed, the Quaker quietly remarking, Now, tell thy master that if he will sell Raby I will pay for it with the same metal.' "
An amusing anecdote is told of the late Jonathan Backhouse. On being pressed by a bumptious bagman, who did not know him, to bet as to the amount of money that they could respectively produce,—
" Mr. Backhouse, after a great deal of banter, said he did not bet, but to show his indifference to money, offered to put a five-pound note in the fire if the commercial would do the same. Suiting the action to the word, Mr. Backhouse took out a five-pound note and put it into the fire. The commercial, not wishing to be behind, did the same. Mr. Backhouse offered to repeat the process, but the commercial, considerably cowed, declined; when Mr. Back- house quietly thanked him for having burned one of his (Mr. Back- house's) bank-notes, for which he had received five pounds, while the note he (Mr. Backhouse) had burned was on his own bank, and had only cost him the paper."
Banking was exciting work in those old days when specie had to be fetched from London for emergencies, and when, as we read, in times of panic, the banks in Lombard Street were seen open on Sunday morning with post-chaises waiting for their parcels of bullion, which had to be carried to the far North through roads infested with highwaymen. Plenty of stirring adventures are to be found in Mr. Phillips's pages, interspersed with facsimiles of banknotes, quaint old prints, autographs, hand-bills, and other interesting matter. This is one of those rare books that furnish information without being dull.
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