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TeachMeFinance.com - explain Suffolk Bank system historic definition... Suffolk Bank system -- A term derived from a scheme for the redemption of the notes of state banks which was devised by the Suffolk Bank of Boston in 1813. The notes of Boston banks at the time were worth 100 cents on the dollar while those of the country banks of New England were at a discount. The Suffolk Bank proposed to redeem the notes of the country banks at par if the country banks would keep a fixed deposit with it, plus a variable deposit to redeem such of their notes as should reach Boston in the course of trade. The interest derived from the use of the fixed deposit was to reimburse the Suffolk Bank for doing the business. The plan served to keep the issue of notes within wholesome limits, as it required a backing for them; at the same time, for the reason that a backing was provided lor them and likewise that a central place of redemption was provided, the value of the notes was maintained at par. About the author Mark McCracken Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English". Copyright © 2007 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.