Valuable Old Lady

When Charles II was King of England, the goldsmiths of London were his bankers. To him they lent well but not wisely and were ruined when he decided not to pay his debts. So when William III needed money in 1694 the Bank of England was created, the bank lending him -L-1,200,000 in return for the right to issue banknotes and conduct a general banking business. The South Sea Bubble nearly ruined them in 1720. The early success of the Young Pretender (Charles Edward Stuart, grandson of James II) started a run in 1745. Napoleon's wars forced them to suspend payments in 1797. But the Old Lady of Threadneedle Street was not to be downed by war, rebellion, or civil commotion. This year she celebrates her 240th birthday.

In almost two and a half centuries much has happened to the price of Bank of England stock. Last week, as sprightly Montagu Collet Norman began his 15th term as Governor, it was revealed that the most exciting thing of all happened only last March. At a semi-annual meeting of the court (board) of directors, one E. T. Hargraves announced that after diligent research he had discovered that on March 6 the price of Bank of England stock was the highest in 240 years: 387% of face value,/- Highest price prior to that was 367% in 1898; lowest, 51% in 1697.

The court of directors had a special reason to be pleased: they are understood to be the biggest stockholders. Twenty-four in number, each is required to hold at least -L-2,000 of stock, while the Governor must hold at least -L-4,000, the deputy governor -L-3,000. How much more they actually hold is a secret. A central bank of issue, Bank of England is owned by private individuals, operates independently of the state. Only holders of -L-500 or more are entitled to vote.

/- Bank of England stock is not traded in shares but in principle amount like bonds.

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