BANKING RETURNS.

Press, Volume LIV, Issue 16259, 9 July 1918, Page 7

BANKING RETURNS.

(FROM A SPECIAL CORHESPOXDE>T.)

WELLINGTON, July 8

The banking returns for the Juno quarter of the current year are not so satisfactory as they were twelve months ago. With the exception of Government deposits, all the items exhibit adverse movements. Thus, free deposits on current account balances, which last year showed an increase of £2,838,243, are this yenr less by £1,270,3G8. Fixed deposits increased last year by £i,2J0,043; this year the increase is only £110,266. All classes of deposits increased last year by £6,172,554; this year tho increase is only £5,405,34;). The advances last year increasou by £3,59<J, ( J94, and this year the increase is nearly a million more, being £4,753,691. There is a larger expansion in circulation, the increase being £1,263,692 against £972,466 a year ago. Coin and bullion, which a year ago exhibited an. increase of this year show a shrinkage of £265,890. The details of the deposits compare as under:— June, Ju tic, 1917. 1913. £ £ £ Government deposits 7,495,823 14,061,274 6,565,451 inc. Ficc deposits 23,380,996 22,110,628 1,270,3G8 dec. Fixed •deposits 13,819,184 13,929,430 110,266 inc. 44,696,003 50,101,352 5,405,340 The Government deposits arc nearly "double what they wore a year ago, but that docs not follow that the whob amount is at the disposal of tho Government. Tho authorities are handling a good deal of inoucy on behalf of the Imperial purchases of produce, and thtre arc, probably, other commitments also that are not disclosed. The free deposits, as already stated, disclose a shrinkage of £1,270,3GS as compared with a year ago t and tho movements as they affect the several banks are shown in the table appended: —

Totals '23,361.i,D9G 22,110,623 1,270,3E8 dec,

The shrinkage in the current account balances is not satisfactoiy, in view of the fact that the produce year has practically ended, and most of the produce has boon i>aid for. Of course there is a considerable quantity of produce in which the Imperial Purchase Board is not interested, but this cannot make all this difference. The disclosure is not a pleasing one. The_ fixed doposits show the slight gain of £110,266, but this is nevertheless satisfactory, as disclosing the fact tlicro is that sum for which the owners have no immediate use. The figures of each bank in respect to fixed deposits show as under:—

13,815,184 13,929,450 110,266 inc

The Bank of Now Zealand is tho chief sufferer in fixed deposits, and the shrinkage shown by that institution is important. Takinjr tho fixed and free doposits together for the Juno quarter of each of the past five years, wo obtain the following: —

The clients of the Bank of New Zealand have drawn very heavily on that institution, and it may be that some part of this increase is due to advances to those taking up the last war loan. The discounts exhibit a shrinkage of £226.193, and this can be understood, for retailers are doing very woil and the importing houses are obliged to restrict their purchases. The discounts for the June quarter of each of the past five years show as under:— Juno quarter. 1314 .. .. 1,799,189 1915 .. .. 1,441,430 1916 .. •• 1,352,718 . 1917 .. .. 1,470,637 1918 .. 1,244,491 If we take the fixed and free deposits on the one hand and the advances and discounts on the other, it will be seen that the excess of deposits haa shrunk materially as compared with each of the three previous years:— Advance®, Exccsa of June Deposits. etc. deposits, quarter. £ £ £ 1914 .. 25,505,744 23,938,855 1,566,889 1915 .. 28,645,156 23,423,577 5,221,579 1916 .. 33,161,889 21,268,340 8,893,549 1917 .. 37,200,180 28,280,803 8.919,877 1918 .. 36,040,078 32,807,801 3,232,277 The circulation and the coin and bullion are the next items to renuire .intention. The circulation has increased by £1,263,692 in the twelve months, or more than £1 per head, and she total circulation is about four times as 'arge as it was in 1914. The figures under the two heads are given below Coin and June bullion. Circulation. quarter. ' £ 1914 .. 1,699,809 5,500,450 1915 .. 2,824,902 6,750,140 1910 .. 3,918,338 7,268,432 1917 .. 4,830,803 > 8,355,526 1918 .. 6,154,495 8,089,636

Coin and bullion has decreased by £265,890. but as against this it must be remembered that tho banks hold large amounts in legal tender notes, apart from the ordinary notes, and bills of other banks. ... Viewed on the whole, the position is not quite satisfactory, and the adverse showing is due entirely to the fact that the producers have been unable to get quit of all their produce. Had this been realised, the banking figures would have taken on quite a different aspect. The position, however, must be viewed as it stands, and it appears that the Government will have some difficulty in raising the nest war loan, not because the people are unwilling to lend to the Government, but merely because they are without the ready cash. The facts must be taken into consideration by the authorities, and steps should be taken to tar new channels for the next loan. There should be a greater effort made to sell war certificates, and if necessary the majturing dates shodld be reduced "to two, three, and four years.

June, Junej 1017. 10'-8. Banka £ £ £ X. Zealand 11,2-12,031 10,G34,243 6C8.-13S dec. Union" 3,250,160 2,957,8.25 392,635 dcc. N.S. Wales 2,735,027 162,563 dec. Australia 2,o23,757 2,37C,5J9 153,209 dcc. National 3,112,171 3,141,560 G,f,09 dcc. Commercial 218,331 271,123 53,072 iuc.

June, June, 1917. 1U18. Banks £ £ & , N.Zealand 6,963,462 6,781,188 182,2(1 dec. Union 1,G38,050 1,045,499 7,449 inc. N.S. Wales 2,236,714 15,805 inc. Australasia 972,530 1,108,970 136,440 inc. National 1,972,788 2,001,885 89,097 inc. Commercial CI,445 95,191 43,749 inc.

Fixed Free Total June deposits. deposits deposits, quarter. £ £ £ 1014 10,807,025 14,698,719 25,505,745 1915 11,208,777 17,430,379 28,645,150 1916 12,619,141 20,342,748 33,161,839 1917 13,819,184 23,380.9!)6 3P,200,180 1918 13,929,450 22,110,028 36,010,078 Comin<* to the advances, there is to be notecT a very substantial increase, a greater increase than was disclose'! last year. The figures of the several banks disclose the position:— Juno, June, 1017. 1918. Increase. Bank. £ £ £ N. Zealand 12,450,872 15,296,619 2,839,747 Union 4,062,919 4,379,713 316,794 N.S. Wales 3,210,016 8,867,776 651,760 Australasia 2,748,111 3,249,024 500,913 National 4,110,647 4,463,058 352,411 Commercial 215,051 307,117 92,066 26,809,616 31,563,307 4,753,691