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The Main and Usual Functions of a Central Bank in England

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Later by name of this street, it has received the nickname: the Old Lady of Threadneedle Street. From the moment of creation, the Bank concentrated on the issue of bills for the accepted deposits, i.e. predecessors of today's banknotes. It also was the banker of the Government and the ministries, simultaneously taking care of the GS (government stocks). The development of the Bank has led to an increase in the area of its building up to today's 3 acres by 1828.In 1826 it has been issued so-called Country Bankers Act, which has “ allowed the establishment of note issuing joint-stock banks with more than six partners, but not within 65 miles of London.

The Act also allowed the Bank of England to open branches in major provincial cities, which gave it more outlets for its notes” (Bank of England, n.d. ).In connection with the further complication of the Bank activity the Bank Charter Act of 1844 has demanded from the Bank conducting two kinds of accounting: on actually bank activity of the Bank and on its issuing activity. This system continues to function now.

However, in connection with several financial crises in the nineteenth century, the Bank has started to depart from commercial bank activity and to pass to attempts of regulation of the level of the interest rate. Simultaneously it has turned to the lender of last resort for banks in difficult financial positions. By the time of crisis of Barings Bank in 1890, when the Bank of England managed to prevent successfully the threat to all bank system of England, the regulation technique has reached the high level of development and set the pattern for the central banks of other countries. During World War II the basic function of the Bank there was financing a public debt, which has grown from 1 up to 7 billion pounds sterling.

Simultaneously it has been entered the control of currency exchange operations, which has been kept up to 1979.The bank has been nationalized in 1946. The property of the Bank authorized capital passed to HM Treasury of Great Britain. As a result of the collapse of several "additional" banks in 1973 and the followed bank crisis, it has been issued the Banking Act of 1979, which has given the Bank of England the right to supervise operations of so-called Recognized Banks and Licensed Deposit Takers.

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