The word bank, distinctly related to the English word bench, is supposed to have been adopted from the fact that early Jewish dealers in money sat by a bench in the streets of Italian cities. The commercial city of Venice is supposed to have been the seat of the first organization distinctly named a bank. This was a corporation of money lenders who handled their capital in the form of coin by exchanging it for notes of individuals. This was as early as the twelfth century. Since that time in every civilized community there has been experiment upon methods for quickening exchanges through such organizations, some of which have been of great advantage and some have brought disaster. The modern system of banking is the result of all these centuries of experience, a history of which cannot be given here.
_Bank described._--A brief description of the most modern form of banks under state or national restrictions will help to understand how these institutions serve the world of commerce.
In simplest terms, a bank is a company founded for the sole purpose of dealing in coin and current certificates of credit of every form, the prime object being the convenience of people in making exchanges of any kind. Sometimes a bank is called upon simply to make change, or, as we say, to break a valuable coin or a bill of large denomination into smaller pieces. On the border land between two countries the banker serves a traveler by exchanging the coins of the country he leaves for coins of the country he enters.
Often the bank, equipped with safe protection against fire or robbers, receives the wealth of others in any form of money for safe keeping, with provision for its being paid when it is needed, whenever and wherever the owner directs. The same bank may be asked to exchange the money in its possession for notes of individuals payable on demand or at definite future time. It may even issue notes of the firm in place of the individual notes received, acquaintance of a community with the standing of the bank as a dealer in money making its notes circulate where individual notes would not. In this case the wider credit of the bank is exchanged for the limited credit of individuals. In the end a well established bank in close association with a system of banks is expected to do any service that has to do with either money or credit, so long as the credit approximates cash transactions, and has not drifted into overdue debts requiring courts and officials for collection.