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Ultimately, however, the banks will have out on loan and overdraft as much money as banking conventions will allow. When that point is reached, the only way to expand business farther will be to attract more deposits from the public. And this is the real significance of the personal loan and personal cheque schemes. Neither of these innova- tions really appeals to people who are already customers of the banks. If you are running a bank account you can already get an overdraft for any of the purposes covered by the personal loan scheme, and you will have no need of a personal cheqUe account. The appeal is directed towards those millions of wage-earners who regard the banks as institutions for other people, and pay away part of their wages in hire-purchase instal- ments instead.

The banks must be pleased with the response that there. has been. The idea has been firmly HE City of London is rightly regarded as one I of the world's leading international centres. Many people would say it was still the main centre. But it is not until you begin to.stroll about the City itself that the truth of this begins to strike home. Before you have gone many yards down Thread- needle Street or Lombard Street or, perhaps better still, Bishopsgate, the real International flavour of the place begins to be all too obvious. Here are bank branches front most pirts of the world. Move along Bishopsgate and you will soon have passed banks with their head offices in Portugal, Belgium, India, France and Czechoslovakia. Go along Lombard Street and the list extends to Canada, Spain, the United States, South Africa and France. In short, there are few countries in the world that have not established a bank branch or banking representative in the Square Mile. The Commun- ist States are well represented and active, from the Moscow Narodny Bank to the Bank of China.

It is not unusual for international centres of finance to have foreign banks in their midst. The main feature of the London scene is that there are so many of them. Whether you go to Zurich, Milan, Paris, Brussels or New York, nowhere will you find so many foreign bankers established.' Experts at the Federal Reserve Board in Washing- ton were interested enough in the whole topic a year or so ago to add up' which centres had attracted most foreign banks. The answer was quite clear. London had by far the most. New York came in second place and Paris was third. In all close on a hundred foreign bank branches are contained in the City of London. What'do they do and what has brought them here?

It is natural for bankers and financiers to fol- low trade, and from the beginning of the nine- teenth century onwards the centre of the world's

International Zone

By A CITY EDITOR planted in the public mind that the banks are out to win customers from all parts of society. But much more effort will be needed before the bank- ing habit really starts to spread. Further, to swell their deposits, the banks will have to make head- way against the savings banks, the building societies and to some extent the hire-purchase com- panies, all of whom are now competing for the public's Savings. Eventually it may be that the banks will win, because they can provide addi- tional facilities on a scale which none of these other institutions undertakes. Through a bank, for instance, you can not only run a current account with all the advantages that brings, and a deposit account, but you can also use the bank to paY standing orders, to look after your valuables or securities, to advise on investments, to get your travellers' cheques and arrange for foreign cur- rency as well as to act as executor or trustee. These facilities are available to all who care to use them: As they becohie better known, and as the public begin to appreciate that bank managers are dis- pensing overdrafts more liberally, many neW accounts should-be opened. The standard of living is expected to doUble within the next twenty-five years; will the number of customers of British banks grow even faster?

financial and trading activities was moving gradually, but none the less strongly, from Amster- dam to London. It was during this period that so many rich continental merchants found their way to the City. Some came of necessity—like so many other political- refugees before and since. Others came because business brought them here. While a number of the City's merchant banks can push their origins back two or three centuries, it is surprising how many of them dttte from the first half of the nineteenth century. But by the end of the century these immigrants were already part of the London scene. They were no longer strictlY foreign bankers. Some maintained, as they still do, close connections with their countries of - origin. But for all practical purposes they had been absorbed into the City's scheme of things. This, in a sense, was the first influx of foreign bankers and merchants—at least since London's rise to pre-eminence about a century and a half ago. The second influx at the turn of the century took quite a different form. By this time foreign banks were beginning to establish branches in the Square Mile. By 1900 there were still little more than a dozen. Yet within another eleven years the number had jumped to twenty-six.

It is not hard to see why they came. The interest- ing question is why so many of them did not core earlier. By that time London was financing the major share of the world's trade; it was finding growing amounts of long-term capital for the rest of the world; and the merchants and banks In London were shipping and 'financing goods and materials all round the globe, a large part of this trade not touching these shores at all. In short, sterling was financing the major share of the world's trade. Commonwealth, European and American trade was largely financed by banks in London in sterling. Since sterling was used to such