THE SAVINGS BANK

Dominion, Volume 10, Issue 3128, 5 July 1917, Page 5

THE SAVINGS BANK

WHY DEPOSITS AEE LIMITED. The limit imposed on interest-bearing , deposits in the Post Office Savings Bank was mentioned in the House ot Representatives yesterday. Mr. J. Payno (Grey Lynn) urged that the limit should be removed, in order that the bank might receive deposits of, any amount and reach its full development as "a State bank, capable of handling the Government business.

The Minister of Finance (Right Hon. Sir Joseph Ward) said that the removal of the limit would destroy the usefulness of the Savings Bank as far as the mass of the people were concerned. . The depositors under present conditions were able to withdraw their money at anytime.. If the limit were removed, the bank would be asked to receive and pay interest upon very large sums of money awaiting investment. It would be impossible to hold these large sums of money ct call, since the bank would have to invesc them in order to earn interest. The bank could not afford to retain enormous cash balances at the disposal of big depositors. The Minister added that the Post Office Savings Bank was not a State Bank in the ordinary sense. It was an institution, designed to meet the needs of small depositors, who wanted to have their money within reach at all times. An attempt to extend its .operations in the way suggested would destroy its value from the point of view of the small depositors. The bank fit- present was the soundest institution of its kind in the country, and it must retain the limit on deposits in order to remain sound.