The next trial came in 1847, and then the Bank permitted its banking reserve (which the law had now distinctly separated) to fall to 1,176,000 L.; and so intense was the alarm, that the executive Government issued a letter of licence, permitting the Bank, if necessary, to break the new law, and, if necessary, to borrow from the currency reserve, which was full, in aid of the banking reserve, which was empty.

Till 1857 there was an unusual calm in the money market, but in the autumn of that year the Bank directors let the banking reserve, which even in October was far too small, fall thus: Oct.

10 4,024,000 L " 17 3,217,000 L " 24 3,485,000 L " 31 2,258,000 L Nov.

6 2,155,000 L " 13 957,000 L And then a letter of licence like that of 1847 was not only issued, but used.

The Ministry of the day authorised the Bank to borrow from the currency reserve in aid of the banking reserve, and the Bank of England did so borrow several hundred pounds till the end of the month of November.