The continental banks which issue notes more closely resemble the English banks as regard their manner of conducting their business. The nature of the transactions of these institutions is limited in a great measure by legal enactments, and they are obliged therefore to confine themselves more to the business of discounts and deposits. The deposit business on the continent has as yet received little or no attention as compared with this country. The issue of notes has always been looked upon on the continent as more important than the deposits, and banks have persistently endeavoured to extend their operations by increasing their note circulation, while they have shown indifference to the question of deposits. It is only since 1876 that the Reichsbank in Germany has begun to encourage the opening of drawing accounts (Girogeschaft) on the English system.

A second class of so-called banking institutions on the continent is that designated "Credits Mobiliers." They do not issue notes, but their business consists to a small extent of receiving deposits and discounting bills. Their principal transactions are of a speculative character such as the placing of foreign loans, the acquisition of real estate or vessels, the working of factories, etc. The first institution of this kind was established as long ago as 1772 by Frederic the Great and called the Prussian "Seehandlungs Societat." For eighty years this example found no followers, but in consequence of the success of the 'Credit Mobilier' of France, organized in Paris in 1852, by Messrs. Pereire, this class of banking concern became a great favorite and many companies have been formed on its model.

A class of banks the like of which does not exist in this country are the 'Mortgage banks' or 'Credits Fonciers.' These make advances on real property up to 1/2 or 2 of its value, raising the money required by the issue of debentures. The capital of these banks serves as a kind of guarantee fund, and some of them, as for instance, the Credit Foncier of France, enjoy excellent credit and have been exceedingly useful in many different ways, but we doubt if their operations are at all times sound, or that a thorough investigation into their position would show as satisfactory a state of affairs as is apparent on the surface. The different conditions under which real property is held in France, probably has something to do with the existence of these institutions in that country, and their absence comparatively speaking with us.

There are some other classes of banks on the continent, but they are of no great importance. The 'Exchange banks' do a similar business to the concerns of the same name in the city of London; and the so-called ' Building banks' answer to our building societies. A peculiar class of banks are the so-called ' Makler banks,' or Broker banks. These were first started with great success at Berlin in 1871. Through their directors and employes they do the business of brokers and back the signature of their attorneys by their capital which is generally employed in contangoes. The success of these institutions was, however, only ephemeral; when in 1873 the collapse came of stock exchange prices, most of them went into liquidation.

A genuine success in the way of continental banking have been the 'Co-operative Credit Banks' of Germany, Austria, Switzerland and Russia. These are popular associations whose object is to grant credits or to afford facilities for the cheaper acquisition of raw materials or articles of consumption, or even for the working of manufactories. The members are mostly liable to an unlimited degree for the obligations of the associations, and thus jointly command better terms than they singly could obtain. The co-operative or the friendly societies in England would correspond to these continental institutions which we mention only on account of the attention which has been given to them by political economists.

In concluding our remarks upon this subject we should mention that the great difference between the English and the continental banking systems arises from the different positions occupied by the principal banking establishments in England and abroad. The Bank of England still continues to be the great bank of issue of the United Kingdom and the great bullion reserve of the country. But side by side with this institution there exist now in London large banks of deposits commanding an influence over the English money market greater than that of the Bank of England. These powerful banks of deposit do not exist on the continent. The 'Banque de France' in France and the 'Reichsbank' in Germany with their numerous branches are by far the most powerful institutions in their respective countries and absorb the discount business to an extent which gives them an almost complete control over their respective money markets.

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