Volume 2 - ElectricCanadian.com

CHAPTER VII.THE LEGISLATIVE DEVELOPMENT OF THECANADIAN BANKING SYSTEM.As has been established by documentary evidence,theCanadian banking system is the direct descendant, and forupwards of half a century past has been the only survivingdescendant, of the first Bank of the United States, the charterof which was planned, chiefly after the model of the Bank ofEngland, by Alexander Hamilton, first Secretary of the Treasuryof the United States. The leading commercial andfinancial houses of Montreal, which were of necessity closelyassociated in matters of currency and exchange with thefinancial houses of New York, sought to establish in Canada abank similar to that of the United States.The bill of 1808 toprovide a charter for the Bank of Lower Canada reproduced,with the minimum of verbal change, the essential clauses of thecharter of the Bank of the United States. Circumstancesprevented the accomplishment of this design, but the chiefpromoters of it, after a second failure in 1817 to obtain acorporate charter under legislative authority, resolved to forma private corporation in the city of Montreal. Thus waslaunched the Montreal Bank in 1817. In the articles ofassociation of this bank all the essential clauses of the charterof the Bank of the United States relating to practical bankingwere faithfully copied. In the following year, 1818, the articlesof association of the Montreal Bank were copied in turn, withthe minimum necessary alteration, by three other banks:the Quebec Bank, Quebec; the Bank of Canada, Montreal;and the Bank of Upper Canada, Kingston. After severalattempts the Montreal Bank finally obtained a legislativecharter, assented to in 1822, as "The President, Directors and