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The rise of financial accountability in British joint stock banks: 1825 to 1845

Published online by Cambridge University Press:  18 August 2020

Chantal S. Game ,
Lisa M. Cullen  and
Alistair M. Brown
Chantal S. Game*
Affiliation:
Curtin University
Lisa M. Cullen*
Affiliation:
Curtin University
Alistair M. Brown
Affiliation:
Curtin University
*
Corresponding author: Dr Lisa Cullen, Faculty of Business and Law, School of Accounting, Curtin University, GPO Box U1987, PerthWA6845, Australia, email: [email protected]; Chantal Game, email: [email protected]; Alistair Brown, email: [email protected].
Corresponding author: Dr Lisa Cullen, Faculty of Business and Law, School of Accounting, Curtin University, GPO Box U1987, PerthWA6845, Australia, email: [email protected]; Chantal Game, email: [email protected]; Alistair Brown, email: [email protected].
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Abstract

This study explores parliamentary reforms related to the financial accountability of banks following the 1825–6 and 1836–7 financial crises in England. An appraisal of nineteenth-century parliamentary Hansard transcripts reveals early banking legislative pursuits. The study observes the laissez-faire and interventionist approaches towards the banking enactments of 1826, 1833 and 1844 that underpin the transformation of financial accountability during this era. The Bank Notes Act 1826 imposed financial accountability on the Bank of England by requiring the mandatory disclosure of notes issued. The Bank Notes Act 1833 extended this requirement to all other banks. The Bank Charter Act 1833 increased the financial accountability of the Bank of England by requiring it to provide an account of bullion and securities belonging to the governor and company, as well as deposits held by the bank. Thereafter, the Joint Stock Banks Act 1844 pioneered the regular publication of assets and liabilities and communication of the balance sheet and profit and loss account to shareholders. State intervention in the financial accountability of banks during the period from 1825 to 1845 appears to have been cumulative.

Keywords

banking crisisfinancial accountabilityinterventionjoint stock bankslaissez-faire

JEL classification

N43: Europe: Pre-1913 N23: Europe: Pre-1913
Type
Articles
Information
Financial History Review , Volume 27 , Issue 2 , August 2020 , pp. 234 - 255
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Copyright
Copyright © European Association for Banking and Financial History e.V. 2020

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Footnotes

The authors would like to acknowledge the assistance of the two anonymous reviewers and Dr Joanne McEwan, and the contribution of an Australian Government Research Training Program Scholarship in supporting this research.

References

Sources

Banking enactments:Google Scholar
Bank Notes Act 1826Google Scholar
Country Bankers Act 1826Google Scholar
Bank Notes Act 1833Google Scholar
Bank Charter Act 1833Google Scholar
Bank Charter Act 1844Google Scholar
Joint Stock Banks Act 1844Google Scholar
Hansard parliamentary proceedings: 1826, vol. 14; 1832, vol. 12; 1833, vol. 18; 1836, vol. 33; 1844, vol. 74Google Scholar
Mirror of Parliament: 1840, vol. 2Google Scholar
Parliament. House of Commons reports:Google Scholar
Report from the Committee of Secrecy on the Bank of England Charter, London: James & Luke G. Hansard & Sons, 1832Google Scholar
Report from the Secret Committee on Joint Stock Banks, London, 1836Google Scholar
Report from Select Committee on Banks of Issue, London, 1840Google Scholar

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