Volume 2 - ElectricCanadian.com

DEVELOPMENT OF CANADIAN BANKING 411for renewal. The Quebec Bank and the City Bank, whichfound themselves in much the same position as the Bank ofMontreal, received new charters in 1841, with practicallythe same conditions. 1During the session of 1841, a new bank, the Bank of theNiagara District, was chartered in Upper Canada. Thewording of the Act2 followed the charters of the Bank ofUpper Canada and the Commercial Bank rather than that of theBank of Montreal, but all the essentially new features in thecharter of the latter were incorporated in it, although owingto careless draughting, as in the case of the Gore Bank, thenew sections were not always reconcilable with the older ones.One of the requirements of the Home Government, not hithertointroduced, was made applicable to the new bank, namely,the condition that before the bank should begin business thewhole of the stock should be subscribed and at least half of itpaid in. There was even a section providing for a proportionalreduction in the allotment of shares in the capital stock of fivehundred thousand dollars in anticipation of an extensive oversubscription.This, however, did not take place; on thecontrary, the requirement that half of the capital should bepaid up immediately was found to be too severe, and wassubsequently relaxed both in this and in other new charters.In the end the bank came into operation under the "freebanking" system just mentioned.In 1842 the charters of the Bank of Upper Canada andthe Commercial Bank were renewed and their capitals increased,3 and all the essential features introduced into thecharters grantedin 1841 were included. In 1843 the Bankof Upper Canada, the Commercial Bank and the Bank of theNiagara District were authorized to set apart a certainportion of their unissued capital stock to be subscribed andmade transferable in the City of London only, and to be*4-$ Viet., 1841, c. xciv and c. xcvii.84-5 Viet.. 1841, c. xcvi.By 6 Viet., 1842. c. xxvii and c. xxvi.