NOTES AND MEMORANDA 541 whom was a body of proprietors of whose names and means they were alike ignorant;but at the same time they had the compensating advantages of periodical publication of accounts. This was really a crisis in the history of banking; the public exercised its right of judgment, and public opinion began to incline steadily towards the joint stock system. It is true that the shortcomings of the private bankers themselves contributed to the success of their rivals. Many disastrous failures of Joint Stock Banks have taken place through reckless, and even culpable mismanagement; but the crimes of Faunt- leroy and of Rowland Stephenson, and tl?e defalcations of Paul, Strahan, and Bates, probably produced a greater effect, and did more damage to the cause of private banking than did the failures of the Western Bank, the City of Glasgow Bank, or the West of England Bank. In the meantime, the Companies Act of 1862 had placed share- holders on a more satisfactory footing by limiting their liability. It is true that there has in some cases been an insufficient recognition of the fact that there is any liability at all, and that shareholders have more than once been rudely awakened from their dream that in embarking in banking they shared profits, without any corresponding duty of permissive control or responsibility for losses. By a subsequent Act of 1880 provision was made whereby the liability of the proprietors, restricted by the Act of 1862, might be once more enlarged for the better ultimate security of the depositors. Under such conditions the Joint Stock Banks continued to increase in relative importance, until the volume of their deposits in some cases rivalled that of the Bank of England, whose controlling influence in the money market became sensibly affected. The growth of the Joint Stock Banks was stimulated by the fact that it was by this time nearly impossible to found a new Private Bank. A Private Bank is of slow growth, and in recent years such have arisen rather as offshoots from some unusually successful trade venture, than on a special and inde- pendent foundation. The growth of population demanded increased banking facilities, and in a district where this demand arose, it could only be satisfied by the establishment of a Joint Stock Bank with a considerable capital, or by the extension to it of branches of banks already established elsewhere. Of the system of Branch Banks the Joint Stock Banks were much more prompt to make use than were the Private Banks; while the right of issuing bank-notes enabled them, here and there, even to anticipate the needs of a district by supplying facilities which its growth was certain shortly to demand. It was thus that while the increasing use of banking accounts and of cheques assigned a constantly diminishing importance to the part played by bank-notes in the business transactions of the country, and while the circulation of both is constantly shrinking, the Joint Stock Banks have always contrived to keep afloat a larger percentage of their maximum circulation than have the Private Banks.
