Up to 1862 the Banks had the right of note issue; but this right was so hedged about by a restriction of the total liabilities payable on demand to a certain multiple (at first three times, later four times) of the cash reserve, and of the total liabilities of all kinds to the amount of the Bank’s capital (up to 1839), or of the total note issue to a fixed amount (from 1839 to 1862), that the note issue of the Presidency Banks never became important. In 1862 the management of the note issue was taken over by the Government in the manner described in Chapter III. At the same time the right of note issue by private Banks was finally abolished.[88] In 1876 the Government relinquished their share of the capital of the Banks and their right of appointing directors.[89] Since then the Presidency Banks have lost their official character, but remain distinct from other Banks in that they are governed by a special Charter Act (the Presidency Banks Act of 1876). 6. The Presidency Banks have worked from the beginning under very rigorous restrictions as to the character of the business which they might undertake. These restrictions were originally due partly, perhaps, to a feeling of jealousy on the part of the Court of Directors of the East India Company lest the Banks should compete in business (such as foreign exchange) which the Company regarded as its own; but chiefly from a proper wish that semi–official institutions, in a country so dangerous for banking as India, should be conducted on the safest possible principles.[90] An exceedingly interesting history of the restrictions is to be found in Mr. Brunyate’s _Account_. In 1862 they were greatly relaxed, but the most important limitations were reimposed in 1876.[91] Since that time only minor charges have been effected. 7. The principal restrictions on the Presidency Banks are now the following:— (i.) The Banks may not draw, discount, buy, or sell bills of exchange or other negotiable securities _unless they are payable in India_[92] or in Ceylon; this restriction has cut off the Presidency Banks completely from dealing in sterling drafts or any kind of foreign exchange; (ii.) they may not borrow, or receive deposits payable, outside India, or maintain a foreign branch or agency for this or similar purposes, and they are thus prevented from raising funds in London for use in India[93]; (iii.) they may not lend for a longer period than six months[94]; (iv.) or upon mortgage, or in any other manner upon the security of immovable property; (v.) or upon promissory notes bearing less than two independent names; (vi.) or upon personal security; (vii.) or upon goods, unless the goods, or the title to them, are deposited with the Bank as security.