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• Banking In Germany.
• Chapter I.: Non-issuing Credit Institutions.
• Chapter II.: German Banks of Issue.
• History of Banking In Austria-hungary.
• Chapter I.: The Austrian National Bank.
• Chapter II.: Austrian Joint-stock Banks and Banking Associations.
• Chapter III.: Hungarian Joint-stock Banks and Private Credit Institutions.
• Appendix to Banking In Germany and Austria-hungary.
• II.: Statistics of Banking In Austria-hungary.
• Banking In the Netherlands.
• Introduction.
• Chapter I.: Era of Exchange Banks.
• Chapter II.: Period From 1814. Modern Dutch Banking.
• Chapter III.: Period 1814-1863. the Netherlands Bank.
• Chapter IV.: The Netherlands Bank, 1864 to 1895.
• Chapter V.: Banks of Issue In the Dutch Colonies.
• Chapter VI.: “cashiers,” Joint-stock Banks, and Private Bankers.
• Banking In the Scandinavian Nations.
• Part I.: Banking In Denmark.
• Chapter I.: History Previous to the National Bank.
• Chapter II.: The National Bank During the First Half of the Nineteenth Century.
• Chapter III.: Private Banks.
• Part II.: Banking In Sweden.
• Part III.: Banking In Norway.
• Banking and Money In Japan.
• Part I.: The Banking System.
• Chapter I.: Common Banks.
• Chapter II.: The National Banks.
• Chapter III.: The Yokohama Specie Bank. ( Shiokinginko. )
• Chapter IV.: The Bank of Japan. ( Nippon Ginko )
• Chapter V.: Land Mortgage Banks.
• Part II.: The Currency of Japan.
• Chapter I.: The Old Coinage System.
• Chapter II.: The New Coinage Period.
• Chapter III.: The Paper Currency.
• Chapter IV.: Readjustment of the Public Debt.
• Chapter V.: The Future Money Standard.
• Appendices.
• Appendix D.: National Debt In Japan. (from the “british Economic Association Journal” of June, 1895.)
• Banking, Currency and Land Tenure In the Chinese Empire.
• I.: China’s Currencies.
• II.: Chinese Banking: Ancient and Modern.
• III.: Land Tenure and Taxation In China.

PART III.

BANKING IN NORWAY.

ORIGIN OF THE ROYAL BANK.

PRIMARILY, Norwegian banking started parallel to that of Denmark, since the oldest Norwegian bank was a department of the Danish Royal Bank, founded in 1813, and of which we have elsewhere given a full account. It is true that in 1760, and again in 1770, the question was mooted of establishing a bank for Norway alone; but the matter ended without positive results. In 1814, however, Norway was separated from Denmark, and one of the first projects of the new Government was to reorganize the Norwegian department of the Danish Royal Bank as an independent institution. The Constituent Assembly resolved in 1814 that the total Norwegian circulation (somewhat over 8,000,000 rix-dollars) of Royal Bank notes, together with such assignat notes as were outstanding, should be guaranteed as a public debt. These notes should be taken up by the Royal Norwegian Bank by exchange for new Norwegian Bank notes, at the rate of 375 rix-dollars to 100 silver dollars. Meanwhile, in order to meet the new Government’s heavy expenses, it became necessary to issue a large amount of new notes, and the consequence was a marked depreciation of the paper currency. One rix-dollar, instead of being equivalent to thirty-two Norwegian shillings in silver, had fallen to six shillings in silver.

After the whole situation with respect to the State’s debt had been subjected to a thorough investigation by the Storthing in 1816, it was resolved to undertake a conversion of the debt at the rate of twelve shillings in silver to every nominal rix-dollar. This plan was carried out by the law of 1819, which contained for its main provisions the following stipulations:

NORWAY BANK ACT OF 1819.

The law provided that a new bank should be organized, and the requisite means were to be procured partly through voluntary contributions and partly through compulsory assessments on property. Upon the inauguration of the new bank, the Royal Bank should cease to operate, and its unredeemed notes, amounting to 2,000,000 rix-dollars, should be withdrawn and liquidated by a like amount of new taxes. The remaining circulation of 23,000,000 rix-dollars should be redeemed with notes of the new bank at the rate of one rix-dollar to twelve shillings in silver and in the current small coin. Such cash resources as were needed at once should be furnished by new taxes on property and trade. As for the existing liabilities, it was provided that these should be modified, and the different obligations be adjusted according to the time they had to run. When the voluntary contributions were not forthcoming, the compulsory assessments had to be made up to a total of 2,000,000 specie dollars, the sum needed for starting the bank. The bank was opened under the name, “Bank of Norway,” and it was authorized to issue notes to twice the amount of its silver reserve. As it was obliged to effect the gradual redemption of the Royal Bank notes, it naturally acquired the latter’s rights in property attachments. [Compare “Banking in Denmark.”] By the earliest bank statutes it had been prescribed that from 1819 bank notes should be redeemable in silver; but that ordinance was suspended in 1818, and the notes consequently depreciated from par value in 1818, to the rate of 220 to 100 in 1822. Subject to passing fluctuations, the rate slowly rose again, till in 1841 it got back to par. The silver reserve was augmented year by year through receipts from attached proprietors; and in 1827 it was exceptionally increased through the creation of new shares amounting to 500,000 specie dollars. That the notes, nevertheless, appreciated only slowly was chiefly due to the strange policy of constantly keeping the circulation as large as the law allowed—that is, twice the extent of the silver reserve, without any regard to varying demands of the market.

NEW CONDITIONS OF REDEMPTION.

The law of 1842 ordained that the Bank should redeem its notes at par, and, at the same time, new regulations were adopted with reference to the terms of redemption. On the basis of the capital stock, which had been raised to 2,500,000 specie dollars (10,000,000 crowns), the Bank might issue notes to the amount of 6,250,000 specie dollars, though this provision was to be merely temporary, in that the Bank should continually buy in silver until the proportion of silver to notes had been brought up to the original status, namely, one to two. Furthermore, in certain various contingencies, the Bank might issue notes to one and a half times, twice, or only once the value of its redemption fund. These regulations have undergone sundry modifications in the course of time; but a detailed account of them would be lacking in general interest. We shall simply add that the present situation is such that, when the Bank has a coin reserve of at least 16,500,000 crowns, the third part of which consisting of claims on Copenhagen, Hamburg, London, and the Swedish Royal Bank, it may issue notes to the amount of nearly 35,000,000 crowns, leaving an uncovered circulation of some 18,500,000 crowns. Any circulation in excess of the legal limit must be fully covered in coin.

The Bank of Norway is governed somewhat like the Swedish Royal Bank. The Storthing, or representative body of the nation, elects all the Bank directors, and appoints a large part of the working force. The board of directors is composed of five members on limited terms of appointment. There is also an elective committee of fifteen; and all these higher officers, together with the directors of the twelve branch banks, serve for six years. The supervision of the Bank of Norway’s accounts devolves upon a board of auditors chosen by the Storthing.

PRIVATE NON-ISSUING BANKS.

Besides the Bank of Norway, which is the only bank of issue in the kingdom, there are private banks, non-issuing. The first of these was founded at Christiania in 1848, and there are now 35 private banks, for which there is no particular legislation. Most of them have but a small capital stock, and only seven show a capital exceeding 1,000,000 crowns. In 1852, the State opened a mortgage bank, whose province should be to furnish loans on landed security. The Mortgage Bank does no general banking business. Its capital stock amounts to 11,500,000 crowns. Some smaller mortgage banks have been started within comparatively recent times, all of which are organized as private joint-stock companies.

The resources and business magnitude of the Norwegian banks will appear from the following table:

SAVINGS-BANKS.

In addition to banks proper, savings-banks play an important part in the financial operations of the three Scandinavian countries. They are generally small institutions, but very numerous; and, as a rule, their activity is not simply confined to savings-bank business. To a wide extent they serve as local banks. The benevolent feature, which characterized these banks during the first half of the century, has been only partly retained. In 1894, there were no less than 537 savings-banks in Denmark, and their aggregate resources amounted to 564,000,000 crowns. Of this sum, 93,600,000 crowns appertained to the Savings-Bank for Copenhagen and Suburbs, and 44,400,000 crowns to the Beehive Savings-Bank of Copenhagen. Thirty-three of the Danish savings-banks had available resources exceeding 3,000,000 crowns. In 1893, Sweden had 377 savings-banks, whose resources were 337,000,000 crowns. The number of savings-banks in Norway for 1894 was 367, and their aggregate deposits amounted to 217,000,000 crowns.

The author has made use of the undermentioned works:

A HISTORY

OF

Banking in Japan;

BY

JUICHI SOYEDA,

secretary and counsellor in the imperial ministry of finance, japan.

NEW YORK.

1896.

BANKING AND MONEY IN JAPAN.