Front Page Titles (by Subject) Branch Bank System. - Money and the Mechanism of Exchange
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Branch Bank System. - William Stanley Jevons, Money and the Mechanism of Exchange 
Money and the Mechanism of Exchange (New York: D. Appleton and Co. 1876).
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Branch Bank System.
It is impossible to avoid perceiving that the organization of the English bank system is undergoing a complete transformation, and is approximating to that which has existed for a century or more in Scotland. Instead of a great number of small, weak, disconnected banks, there is arising, by amalgamation and extinction of the weaker ones, a moderate number of important banks, each possessing numerous branches. The Scotch banks have long had many branches, and at present each of the eleven great banks has on the average 78 branches, the lowest number being 19, and the highest 125. Already a few of the English banks have equally extensive ramifications. Thus the London and County Bank, and the National Provincial Bank, which have especially developed the branch system, have respectively 148 and 137 branches; the Manchester and Liverpool District Bank has 50 branches and sub-branches. The Irish banks also adopt the same system, and the National Bank of Ireland has about 114 branches and sub-branches. It is interesting to observe that in Australia, too, the banking system has taken a similar form, and a comparatively small number of strong banks, such as the Bank of New South Wales, or the Bank of New Zealand, leave no rising village without its branch.
Now, the close connection which exists between the head office and each of the branches of an extensive bank leads to a great clearing off of claims. The diagram on p. 256 again serves to represent this relation, X being the head office, P, Q, R, S, branch banks, and a, b, c, etc., customers. If a pay m with a cheque on P, the cheque will be paid into R, credited to m, forwarded by post direct to P, and debited to a. The head office, being informed of this transaction in the usual daily statement, will close the business by transferring the sum from the account of P to that of R. Much accountants' work seems to arise, but it is work of mere routine which costs little. Cash remittances are seldom necessary, because each branch settles accounts only with the head office, so that many sums will be credited and debited during each week, and the balance will usually be small. The head office, in fact, acts in every way like a clearing house, or bankers' bank.
The question naturally arises, indeed, how will the branches of one bank transact business with those of another bank? The solution, however, is simple; for unless the branches happen to be in the same town, or for other reason, in close relation with each other, they will communicate through their head offices. A cheque upon any branch of the London and County Bank received by a branch of the National Provincial Bank, will be presented through the head office of the latter at the Clearing House upon the head office of the former.