The establishment of this great company was formed about the year 1694. Government at that time having great occasion for money, a set of men was found who lent to it about 1,200,000_l_. sterling, at 8 _per cent._ for the exclusive privilege of banking for 13 years; with this additional clause, that 4000_l._ sterling, _per annum_, should be given them to defray the expence of the undertaking. This sum of 1,200,000_l._ sterling, was the original bank stock. It has been since increased to 11,000,000_l._ by farther loans to government, for the prolongation of their privileges; as has been taken notice of in the 16th chapter of the second part. This stock, as in banks of circulation upon mortgage, is only to be considered as a subsidiary security to the public for the notes they issue: were it the principal and only security for their paper, this bank would then be founded on the principle of public, not of mercantile credit; under which last denomination we are going to point out in what the nature of it differs from those we have already explained. It is a rule with the bank of England to issue no notes upon mortgage, permanent loan, or personal security. The principal branches of their business may be comprehended under four articles, viz. 1. The circulation of the trade of London: 2. The exchequer business of Great Britain: 3. The paying the interest of all the funds transferable at the bank: 4. Their trade in gold and silver. I shall now shortly explain the nature of these four great operations; and first as to the circulation of the trade of London. When we speak of the circulation of trade, we understand the circulation of money paid on the account of trade. The great occupation of the London merchants engages them to simplify their business as much as possible. For this, they commit to brokers every operation which requires no peculiar talents or ingenuity in the merchant himself; and, for a like reason, they commit to the bank and private bankers the care of their cash. A Scots merchant begins by drawing money from the bank, for which he pays interest: a London merchant begins by putting money into the bank, for which he draws no interest at all. A London merchant, therefore, can give no order upon the bank, unless at a time when he has money lodged in it. If he has occasion for money at any time, he sends to the bank the bills he has, before they become due, and the bank discounts them at certain rates, according to their nature. If it be a foreign bill, the bank in discounting it, retains of the sum, at the rate of 4 _per cent. per annum_, for the time the bill has to run; but if the bill be at a longer day than 60 days, they will not discount it. So in this case, the merchant must keep his bill until it is within 60 days of the term of payment.