Volume 2 - ElectricCanadian.com

30 HISTORY OF THE BANKIt was natural that Mr. McMaster, who had founded abank as a protest against what he deemed the unfair treatmentof^Ontario, should be personally opposed to the Rose resolutions.In this he had the support of almost all bankersthroughout Canada, who pointed out that the governmentproposals would make it necessary for the banks to replaceby the new notes not only their outstanding note circulation,but also those notes held as cash in the tills of the branches.This would involve the purchase of an immense amount ofgovernment securities at prices enhanced by the suddendemand. As the funds of the banks were already fullyemployed in then* discount business, the only way in whichthe necessary money could be obtained would be by callingon their customers to pay up their loans. This would at onceaffect the mercantile business of the country, and hi manycases cause distress and failure. There was also the objectioninvolved in the alternative of either carrying unused in theirtills for the greater part of the year the additional notesrequired to move the crops each autumn, or else bringing onevery year at that period a money stringency with all itsattendant evils. It is characteristic of Mr. McMaster,however, that he did not show his opposition publicly to theresolutions. He had excellent reasons for this, one being thehope of an easy passage for the private legislation desired byThe Canadian Bank of Commerce. It was a young institution,and though its advent had been eagerly welcomed bythe investing public of Ontario, it could not command supportin Parliament to as great an extent as some of the older banks.The Senator, therefore, thought ithimself inunwise to placeopen antagonism to the powers that ruled the Finance Departmentof Canada. The private legislation referred to was anapplication by the bank for permission to increase its capitalstock from one to two million dollars. Within a year or two,in mistaken zeal, he sought and obtained authorization foranother increase of capital. His correspondence from Ottawaduring 1869 and 1870 shows that these measures met with an