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 founded. There are also other securities in the Issue Department, which are, and in fact always have been, securities of the British Government. But it should be noted that nothing in the Bank Act restricted the Bank of England to securities of this kind for the backing of the fiduciary part of its note issue.

When we look at the Banking Department's figures we find it much more similar to the balance sheet of an ordinary bank. Capital of course explains itself. "Rest" is the somewhat eccentric title under which the Bank of England describes its reserve fund, which is also eccentric in the fact that it fluctuates with a frequency and to an extent which is unusual with other reserve funds. In fact this item appears to include both the reserve fund and the profit and loss account.

In the next two items we find the real significance of the Bank of England's position. The Public Deposits are the deposits of Government Departments, and it need not be said that the Bank of England's position, as bank of the British Government, has been in the past the main cause of its great prestige and of its paramount position in the London Money Market. Nowadays, perhaps, the next item is even more important. The Other