Volume 2 - ElectricCanadian.com

382 HISTORY OF THE BANKThe epidemic came as a sort of aftermath to the ravages ofwar, and in numberless cases set the seal of tragedy on the mostdistressful five years in the history of Canada.At the close of the bank's fiscal year in November, 1918,the sum of $1,500,000 was added to the Rest, increasing thatfund to $15,000,000, a sum equal to the paid-up capital.This event, occurring just a few weeks after the signing ofthe armistice which closed the long and weary struggle withGermany and her allies, may be considered as marking theculminating point of the first fifty years of the bank's history.The exact anniversary had fallen some eighteen monthsearlier, on May 15, 1917, 1 but the outcome of the colossalstruggle in Europe was so wrapped in gloom that thoughit would then doubtless have been possible to reach this goal,the step would not have been warranted by the financialconditions of the times.The idea, so popular among Canadian banks, of accumulatinga Rest or reserve fund equal to the paid-up capital, isan outcome of the double liability clause of the Bank Act.The fund is intended as a safeguard of the interests of theshareholders in the event of the double liability being enforced.In the case of The Canadian Bank of Commerce (includingfor this purpose the figures of the Eastern Townships Bank),about seventy-one per cent, of the Rest has been derived fromundistributed profits, twenty-two per cent, from premiums onnew stock issues, and the balance from the purchase of thebusiness of the Bank of British Columbia and of the HalifaxBanking Company. 2 The accumulation of this fund has been1 The end of the bank's fiscal year has been changed twice during its history;first in 1887 from June to May, and then, in 1901, from May to November. Thismakes it difficult to compare the figures as on the exact dates.The composition of the Rest of The Canadian Bank of Commerce is givenbelow, the figures in the first two columns analysing the share of that bank alone,while the second two include an analysis of the Rest of the Eastern TownshipsBank, which was transferred, as it stood, to the Rest of The Canadian Bank ofCommerce. In the case of the other two banks, the Bank of British Columbia andthe Halifax Banking Company, the amount transferred to the Rest of The CanadianBank of Commerce bore no definite relation to the Reserve Fund shown on the books