PROVISION OF BORROWING FACILITIES. 885 



situated within their district, provided that at least one-half per cent, 

 of the capital is to be repaid annually ; in special circumstances this 

 sinking fund payment may be waived for a period of two years. 



In most Prussian Provinces there are Land Improvement Funds 

 or Land Improvement Annuity Banks, which form in fact branches 

 of the provincial administration. They were founded as a result of 

 the demand by agricultural organisations for the provision of credit 

 for land improvement which should be adequate in amount, not 

 subject to recall, amortisable, and bearing moderate interest. In 

 Saxony, Bavaria, Hesse, and Oldenburg, Land Improvement Annuity 

 Banks also exist. But these institutions have not developed any 

 great volume of business, nor have loans been usually made to indivi- 

 duals, except in Prussia, where, down to the end of 1908, 250,000 

 out of 565,000 lent had been granted to large landowners holding 

 under family or other special settlements, and an additional 20,000 

 to other landowners within the same period. In Bavaria and Saxony 

 where these Banks show greater activity, the great bulk of the loans 

 have gone to communal authorities for water supply and for local 

 schemes of drainage and road construction. The Bavarian Legislature 

 has recently (1908) extended the scope of the Bavarian Bank to the 

 loan of money for pr omoting the production and supply of electric 

 light and power, especially in country districts, as well as the erection 

 of dwellings for rural and other work-people and the settlement on 

 the-land of agricultural labourers ; and at the same time the limit 

 of value of bonds (for which the State is guarantor) in circulation was 

 raised from 1,500,000 to 2,500,000. 



The Prussian Provincial Aid Banks grant credit mainly to bodies 

 of a public or semi-public character to communes, unions of 

 communes (Kreise), school and ecclesiastical organisations, and 

 co-operative societies, especially those for land improvement. In 

 two or three provinces, however, loans on mortgage security are 

 made inther extensively to individual owners. Like the Prussian 

 Laud Improvement Banks they are conducted as a department of 

 the provincial government. 



Under a Prussian Act of 1850 seven Rent CJiarge 7&/>//-.v were 

 created, each to serve one or more provinces, and authorised to issue 

 bonds to landowners in settlement of charges and servitudes due to 

 them (but declared by an Act of the same year to be commutable) 

 and to collect from landholders thus relieved annuities comjK)sed 

 49 



