JOURNAL OF THE Institute of Bankers. (FOUNDED 1879.) VOL. XVIII.-YEAR 1897. London: BLADES, EAST & BLADES, PRINTERS, 23, ABCHURCH LANE, E.C. - 1897. H. F. BILLINGHURST HORACE GEORGE BOWEN ROBERT CAMPBELL NATHANIEL CORK ROBERT DAVIDSON.. .. Council. London and Westminster Bank, Limited. National Bank of India, Limited. Commercial Banking Company of Sydney, Ltd. SIR JOSEPH COCKFIELD DIMSDALE Prescott, Dimsdale and Co., Limited. Parr's Bank, Limited. National Provincial Bank of England, Limited. London Joint Stock Bank, Limited. Martin's Bank, Limited. Capital and Counties Bank, Limited. Messrs. Glyn, Mills, Currie & Co. Messrs. Hoare. London and County Banking Co., Limited. Messrs. Coutts & Co. Barclay & Co., Limited. Barclay & Co., Limited, Great Yarmouth. Messrs. Smith, Payne & Smiths. Union Bank of London, Limited. National Bank, Limited. Williams Deacon and Manchester and Salford Honorary Secretaries. MARTIN'S BANK, Limited, 68, Lombard Street. Solicitors. MESSRS. JANSON, COBB & PEARSON, 41, Finsbury Circus, E.C. Secretary. W. TALBOT AGAR. Offices. 34, CLEMENT'S LANE, E.O. The Institute of Bankers. JANUARY, 1897. A. S. HARVEY, Esq., in the Chair. RAILWAYS IN THEIR ECONOMIC AND FINANCIAL ASPECTS. Lecture I.-What a Railway is. [Delivered before the Institute, November 11th, 1896.*] (Right of reproduction and translation reserved). ROM the syllabus you will see that I have undertaken, I might almost say, to compress two volumes on the subject of railway economics into a lecture of an hour. I dare say you will forgive me therefore if I do not preface my lecture further than by briefly thanking you for the cordial manner in which you have received me. I propose to start from this point, which is a matter of common knowledge, that of the earnings which a railway company receives, roughly speaking, onehalf goes to pay working expenses and the other half to pay interest on capital. It is a common expression to say that a railway is worked at 50 per cent., or as it has come to be of late years in England, 54 per cent. or 55 per cent. of the gross receipts. We are of course not dealing with accurate figures but only with principles. For practical purposes let us say that half the earnings of a railway go to pay the interest on capital; we may call this half toll for the use of the road; just as in the case of the use of the turnpike road you paid toll for the privilege of driving along it, and that toll went to pay the interest upon the money that built the road, so in the case of a railway company, if you pay 2s. in fare, on the average 1s. goes to pay for the use of the railway. That at the outset is the thing which more than any other, I think, differentiates a railway from ordinary business concerns, the large proportion of its earnings which is absorbed in paying interest on fixed and irrecoverable capital. A bank has, you may say, a good deal of its capital invested And in Birmingham, on November 10th, 1896, Mr. Hugh A. N. Smith presiding. 403161 B |