The Dominion MONDAY, JANUARY 11, 1915. BANKING RETURNS

Dominion, Volume 8, Issue 2355, 11 January 1915, Page 4

The Dominion MONDAY, JANUARY 11, 1915. BANKING RETURNS

The banking returns for the closing quarter of 1914 are now available, and judged on the whole the figures disclose a very satisfactory position. There is an increase in the advances of £1,294,489,-but a decrease in the discounts of £203,016, so that actual increased accommodation given by bankers to the* public, as compared with the December quarter of 1913, is £1,091,473; Turning to the other side of the account the free deposits show an increase of £1,381,604, and the fixed deposits an increase of £182,275, together totalling an expansion of £1,563,879, which is decidedly good. Bunk notes being legal tender the note circulation nas expanded by. £942,509, but the banks have ample cover for this as the total of coin and bullion has increased by £918,930, or practically, 'the same as the note circulation. • ■ Taking first 'the advances, the total for the past quarter is £23,121,235, as compared with £21,826,746 for the December quarter of 1918. The increase is not large, and indicates that traders, farmers, ' and others are able to get along without requiring very much help from the banks. TJie increase in the advances is shared in. by all the banks, as the following table shows: — Dec. 1913 Dec. 1914 Inc. . "RflTlV .P 1 -P Q N.Z. .'. 8,971,901 9,404,147 492,246 Union 8,731,686. 4,159,2(50 427,574 N.S. Wales 2,983,847 3,122,238 138,391 Australasia 2,961,208 3,060,951 99,743 Notional .... 3,155,330 3,240,719 85,389 Commercial 22,744 73,920 51,146 21,826,746 23,121,235 1,294,489 The largest gain relatively is shown by -the Union Bank of Australia. The discounts for the past quarter aggregated £1,811,573, against £2,014,589 for the December quarter of 1913, and all the institutions shared in the decrease except the Commercial Bank, which exhibits the modest gain of £1817, the figures of this institution _ being £3317, against £1500. Taking a period of five years the aggregates of the advances and discounts compare as under:— Dec. Advances.' Discounts. Totals, quarter. £ £ £ ' - 191 17,850,615 1,802,773 19,653,388 1911 21,388,649 1,802,354 23,191,003 1912 21,396,049 1,950,494 23,346,543 1913 21,826,746 2,014,589. 23,841,335 1914 ...... 23,121,235 1,811,573 23,932,808 The shrinkage in the discounts is perhaps the Dest feature shown, because it implies that traders are finding collections not so difficult, and probably also business is being done more on a cash basis. .. Now we pass to the deposits, and it is pleasing to see that there are increases' under the several heads, as the following table shows:— Dec. 1913 Dec. 1914. Inc. £ v £ Go-rt. deposits 2,086,064 2,418,545 ' 332,481 Free deposits 12,293,875 13,675,479 1,381,604 Fixed deposits • 10,515,345 10,727,620 182,275 24,925,284 26,821,644 1,896,360 The growth of the fixed deposits and of the deposits in the Post Office Savings Banks indicates that the people are able to save money, and that the economic conditions are not merely normal, but rather favourable. It is a period of prosperity. .The free deposits on current balances have increased by £1,381,604, in which all the banks have shared. The table' given below shows the movements:— • Dec. 1913 Dec. 1914 Inc. Bank. X £ ■ .C N. Zealand, 5,789,341 6,349,316 559,975 Union 1,682,112 1,989,028 306,916 N.S. Wales . 1,541,883 1,680,531 138,648 Australasia .. 1,298.284 1,460,714 162,470 National ... 1,942,837 2,103,588- 60,751 Commercial 39,418 92,262 52.5-14 12,293,875 ; 13,675,479 1,381,604 With respect to fixed deposits all the banks except the Union Bank exhibit increases. Taking the free and the fixed deposits for a series of years we obtain the following: — Free Fixed 'Total Dec. deposits deposits deposits quarter. £ £ £ 1910 12,120,977 10,442,341 22,563,318 1911 12,934,464 10,496,666 23,431,130 1912 12,468,018 10,438,732 22,906,780 1913 12,293,875 10,545,345 22,839,220 1914 13,675,479 10,727,620 24,403,099 The totals of the deposits have varied somewhat during the past fivo years, and it is significant that the fatal for 19M is considerably larger than in any previous year iu the table. Obviously the people have money to spare aud mouey to spend. Another interesting table is furnished by taking the aggregates of the advances and discounts and comparing the one with the other. The table appended shows the position :— Excess of ! Doc. . Deposits Advances Deposits I quarter. X £ j; 1910 22,563,318 19,653,358 2,909,930 1911 23,131,130 23,191,003 210,127 1912 22,906,750 23,3-16,543 439,763" 1913 22,839,220 23,811,335 1,002,115* 1914 23,403,099 23,932,808 529,709* 'Excess of advances. During the past three years tbe demands on the banks have been' exceptionally large, so that the advances have exceeded the deposits. We have now to deal with the cir-ni.laf-inn and the coin and bullion.

an'd the figures for five years compare as under:— December Circulation. Coin & bullion quarter. £ £ . 1910 1,649,928 5,028,248 1911 1,698,160 5,351,053 1912 1,712,466 5,237,767 1913 1,671,723 5,290,183 1914 2,614,232 6,209,113 The abnormal growth of the circulation is due to notes being legal tender, and it also indicates that there is no hoarding of gold by the public. Professor Chapman, of Manchester University, in an address recently to members of the Bankers' Institute, stated that one thing that non-com-b&tants i could do" to furnish aid in 'che national crisis was to pay their gold into a bank and take paper in exchange. A sovereign in the Bank oi England was worth a hundred in the pockets of the people, and the same holds good in New Zealand. The gold has found its way into the banks, and the banks have been thereby strengthened. ' It is impossible to take other Jhan a cheerful and optimistic view of the banking and financial position of the Dominion. The country is sound, and as there must continue to be eager competition for the food and other products of New Zealand the immediate future holds out bright prospects.