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The Financial System was in the Disarray
Willam and MarySince William and Mary had taken the throne, they lived a extravagant life.They borrowed a lot of money so that the goldsmith bankers were damaged by the lax financial management of the Stuart kings. -
The Royal Charter was sealed
William envisaged a loan of £1,200,000 to the Government, and promised that the subscribers would be" Governor and Company of the Bank of England".The Royal Charter was sealed on 27 July 1694 and the Bank started the role as the government's banker and debt-manager. -
Open for Business
The bank opened for business in temporary accommodation in the Mercers' Hall in Cheapside. In 1734, it moved to a new site,Threadneedle Street.The Bank of England is sometimes called the 'Old Lady of Threadneedle Street'.After that, the bank accepted deposits and issued bank notes.The Bank's notes became a widely accepted currency. -
£1 and £ 2 was issued
The national debt increased by the end of the Napoleonic wars.Those wars put a lot of pressure on national finance and in 1797 the drain on the gold reserve.It made the bank stop paying out gold in exchange for bank notes.Until 1821, the bank issued £1 and £ 2 to compensate the shortage of the gold.The low denomination is also a temptation for counterfeiters.and over 300 people were hanged during the Restriction Period for counterfeiting Bank of England notes. -
Bank of Scotland
The Royal Bank of ScotlandMany "country" banks issued their own banknotes at that time, but it was difficult to circulate, especially in the difficult trading condition between 1820 to 1830.From 1828,to meet the demand for banks, these country banks open branches in some provinces. -
Banker to the Banks
In 1884, the bank was overtaken by the great joint-stock deposit banks.The bank chose not to compete directly with the joint-stock, but to develop its role as the central bank: the guardian of the gold reserve, the supplier of liquidity of last resort. In 1866 and 1890 bank crises threatened the bank system, always seeting interest rate was a matter of discretion for the bank. -
The Bank Charter Act
Bank Charter Act 1884The Bank Charter Act gave the monopoly of note issue in England and Whales and the right to continue to issue its own notes in Scotland. The Bank became the sole monetary authority for the United Kingdom.In order to prevent the inflation, the Act prevented the Bank from issuing new notes that were not matched by an increase in its gold reserve. -
The Bank Rebuilt
During the 1920s and 1930s the bank was rebuilt almost completely. -
The Gold Standard was abandoned
The Gold StandardAfter The First World War, the gold standard became more weaken.To prevent from the inflation and the trading diificulties among countries,etc,the gold standard was abandoned in 1931. -
Nationalisation
Though the bank was privately owned, its activities were still undertaken by the government.In 1946, it was nationated formally.It meant that the bank was owned by the governemnt rather than by private stockholders.
