Indeed, it cannot be wondered at that the Bank proprietors do not quite like their position. Theirs is the oldest bank in the City, but their profits do not increase, while those of other banks most rapidly increase. In 1844, the dividend on the stock of the Bank of England was 7 per cent, and the price of the stock itself 212; the dividend now is 9 per cent., and the price of the stock 232. But in the same time the shares of the London and Westminster Bank, in spite of an addition of 100 per cent, to the capital, have risen from 27 to 66, and the dividend from 6 per cent, to 20 per cent.[1] That the Bank proprietors should not like to see other companies getting richer than their company is only natural.
Some part of the lowness of the Bank dividend, and of the consequent small value of Bank stock, is undoubtedly caused by the magnitude of the Bank capital; but much of it is also due to the great amount of unproductive cash—of cash which yields no interest—that the Banking Department of the Bank of England keeps lying idle. If we compare the London and Westminster Bank—which is the
- ↑ The Bank of England dividend declared in April, 1914, in respect of the half year ended February 28, was at the rate of 10 per cent. per annum subject to deduction of income tax as compared with 9 per cent. per annum free of income tax for each half year since 1904. The price of Bank Stock at the end of April, 1914, was 249½. The dividend of the London County and Westminster Bank was at the rate of 21¼ per cent., and the £20 shares £5 paid up were quoted at 21¾.
