It is quite clear in such a state of things that a decided and very serious falling away would be witnessed in the efficiency of the system upon which the business generally of the country was conducted, and that the interests of the community both at home and abroad must of necessity suffer in consequence. Where private firms, having for a number of years carried on their business under the watchful and never-tiring care of partners directly interested in the result, are merged in companies to be managed in numbers of cases by persons with less experience and skill than was possessed by those who guided the fortunes of the business previously, inferior results as regards profits will as a matter of course be obtained. We have but to cite the memorable example of the firm of Overend, Gurney and Co., whose conversion into a joint-stock company and subsequent collapse did so much harm to English credit abroad, to show how much the confidence foreigners had previously felt in the practical business qualities and high integrity of English traders, would be likely to diminish on their realising how much looser and more dangerous were the foundations of our joint-stock system.

One of the great defects as regards organisation lies in the fact that in banks, for example, it is almost impossible to keep up a sufficient supply of well-fitted and properly qualified managers. Joint-stock banks grow and pay larger and larger dividends, and, indeed, increase their capital as a safeguard against the risks necessarily arising from the wider area of their operations; but they think it superfluous to multiply and educate the managers and departmental managers. A bank manager should have at least some commercial experience, which is only to be gained by practical experience as a trader, or in a trader's office. How can any man hold his own against the tricks of traders when he has never had any practical experience of them? One man, moreover, can only do the day's work of one man. If he is set to do the work of two, he either does everything badly and loses the money of the proprietors, or he breaks down in his efforts to keep pace with the too great calls upon his powers, and eventually dies of softening of the brain. This is not unfrequently happening in London, and is a circumstance in connection with joint-stock banking of the gravest importance.

Whatever diminishes the interest of the labourers in their work is injurious to the work. England and France have in many things shown opposite tendencies. France has been developing the system of societe en commandite or the spreading of capital, so that little money shall be managed by many heads, while England has been collecting her floating capital into unmanageable heaps and economising the management of it to such a point that there is little exaggeration in the statement that during a large portion of their career the English joint-stock banks are in their working not very far from automatic. Every bank naturally endeavours to attract to itself clients whose drawing and discount accounts require but little looking after.

Those who use the banks for their own purposes, and have no particle of interest in its existence except for the use that can be made of it as a means to the end they have in view, prey upon it with ruthless voracity when difficulties arise and they are driven to seek any port in a storm. Yet when managers and directors are well aware that such will be the course their clients will pursue, in nine cases out of ten in case of need, year after year new accounts are opened, fresh and little known people are trusted, the guide and index to their stability being the possession of some thousands of ready cash, which, like a dazzling sunray, is thrown between the managerial vision and the underlying difficulties which it is sought to cloak. We require no proof that such is the case, for the events of the midsummer of 1875 are sufficient confirmation of the truth of the statement. For a series of years the joint-stock banks of London had been dividing more than they had really earned, for no bank can consider its profits fully realised until every obligation to the bank has been liquidated.

What a wholesome innovation would it be if every establishment laid down a law that once a year every client upon their books who had a loan, or whose name was under discount, paid up and stood clear for a fortnight. While no such test is ever applied to anybody, who is to prevent future Collies from ringing the changes on all the banks, one after the other, each being ignorant of what is going on outside his own door? Year after year passes by, and such is the eagerness for fresh business, and such the keenness of the competition, that fresh plasters are put upon the external indications of the disease within, and the more arduous task of grappling with the disorder at its root is continually postponed. The day's work of these overgrown establishments is got through with thankfulness when no new catastrophe has occurred to add fresh evidence to that already accumulated in favour of an improvement in the organisation. How is it possible for two or even three men to preside over the affairs of a bank having say some eight to ten thousand drawing accounts and deposits to employ, varying in the total from ten to thirty millions. The successful solution of the problem lies in the subdivision of these large institutions and the appointment of an experienced and able manager to each division, as if it were a separate bank, By such a spreading of the duties and response bilities each would be able to look after the customers who kept their accounts in his department, and something definite could be known of the business ramifications of each. No bank can be successfully managed unless its clients are followed up. There should be no guess work in discounting business. A man in trade is either making money or he is losing it, and it is the first and most important business of the bank manager to find this out, and not give accommodation simply because the dealings of the client with the bank have been steadily regular, and he has kept a decent balance. The balance, in the case of a sharp man of business will obviously be steadily larger up to a certain limit, in proportion to the difficulties he has to contend with. His sheet anchor is the good word his bank will say for him, and consequently the last thing he will disturb is the foundation upon which that rests. Herein lies the pons asinorum of bank management.