10
(The Bank of Iceland) was established by law of 1903, and commenced
ils activities two years later. For a term of 30 years it was granted
the sole right of issue in Iceland in excess of the 3/4 million krénur
which the National Bank of Iceland was entitled to issue on behalf of
the treasury. This right was retained by f[slandsbanki for a period
of 19 years (1904—1922). But in 1921 it was enacted by law that
its note-issuing privilege should lapse in 1933, and its note circulation
be reduced by fixed annual amounts. When [slandsbanki was taken
over by Otvegsbanki Islands the circulation had come down to 4
million krénur. This amount is (according to the act under which Ut-
vegsbanki fslands is founded) to be withdrawn at once and the sole right
of issue handed over to the National Bank. But while [slandsbanki
was thus withdrawing its notes the National Bank was by law ob-
liged to re-discount for it sound commercial bills on certain specified
terms, to an amount not exceeding 5 million krénur. The amount for
which the National Bank was legally bound to re-discount bills should,
however, be annually reduced until it was entirely discontinued. The
special terms thus enjoyed by [slandsbanki are now transferred to
Utvegsbanki fslands.
According to the Balance Sheet the assets and liabilities of [slands-
banki on 31. December 1928 were as follows:
Gold . . . . . .
Bonds & Stocks . .
Loans . . . . . . . . . ..
Bills of Exchange kr. 24 632 680.88
less Net Profit — 583 003.16
Kr. 24 049 677.72
less estimated
loss according
to Bank Inspec-
tor’s estimate . — 1014 982.62 23 034 695.10
To balance (see Bills of Exchange) 1014 982.62
Banking Correspondents . , , 261 208.18
Foreign Currency . . . . . , — 7 184.93
Bank Premises and other real Estate — 2 034 809.09
Cash in Hand . . . . — 451 882.55
Kr. 38 774 962.51
Assets,
. . kr.
1 878 049.65
2 535 831.07
7 556 319.32
Capital Paid up . . . . .
Notes in Circulation . . ,
Bank Bonds . . . . . .
Liabilities,
. . kr. 4500 000.00
. - 4811 000.00
«0 o—- 706 000.00
Kr. 10 170 000.00
