The Clearing House.

The new system had but been three years in operation before the Cheque-issuing Banks found the advantage of periodically adjusting their debts by mutual Releases, as had been done in the sixteenth century by the French Merchants, whose bills were all made payable at the Fair of Lyons, and as had already been practised in 1775 by Banks in Edinburgh. What is called the Clearing House was thus established, and until 1854 consisted merely of a meeting of private Bankers who exchanged Cheque claims with one another daily, and paid only the net differences in Cash or Bank Notes. In 1810 the thrty-six private banks that "cleared" had a total duly average of £4,700,000, and were able to settle ill their balances by some £220,000 in notes. In 1154 the Joint Stock Banks, rigidly excluded thus far from the Clearing House, were preparing to organise one of their own, when suddenly some half dozen of them were admitted to its benefits, from which, however, the Bank of England was shut out until 1864. It was stated in evidence to the House of Commons that, prior to the admission of Joint Stock Banks, the London and Westminster used to be compelled to keep £150,000 in notes to meet its daily "Bankers' charges" alone. What must have been the aggregate waste of trading capital forced thus upon the community?