One hundred years ago
THE last ten days have been marked by an excitement in the City which has twice almost reached the proportions of a great panic. It has been for some time whispered about that the great house of Baring Brothers was in difficulties ow- ing to a great lock-up of its capital, and on Saturday it was announced that it had been compelled to explain its posi- tion to the Bank of England, and ask for assistance on an unprecedented scale. It was liable, in one way or another, for twenty-one millions sterling, and though its resources exceeded this by nearly four millions, so much of them was locked up in Argentine and other stock only saleable at heavy loss, that unless aid could be afforded, it might be compelled to suspend payment. The Bank, after ascertaining the exact state of affairs, agreed to advance the capital necessary to meet all the mercantile acceptances of the firm as they ma- tured, on condition that it received the assets of the firm as security, and was guaranteed against loss. The guarantee was given in the form of a subscription, by the Rothschilds and most of the other great houses and banks in the country, to the total extent of seventeen millions, and London was saved from a commercial catastrophe which would have been worse than that of 1866. It is rumoured that even the Treasury was alarmed at the far-reaching consequ- ences of the possible disaster, and that the Bank was assured that in the event of need, the Bank Charter Act would be suspended.
The Spectator, 22 November 1890
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