BANK RETURNS

Evening Post, Volume CXII, Issue 87, 9 October 1931, Page 10

BANK RETURNS

REDUCED ADVANCES

INCREASED DEPOSITS

Returns of the average amount of liabilities nnd assets of the six banks of the Dominion for the quarter ended 30th September last, when compared with those of the September quarter of 1930, show Government deposits at £2,694,788, or £905,314 less than at the end of September, 1930.

Free deposits, or current accounts, amount to £16,590,061 this September quarter, a drop of £4,212,510 for the year, plainly indicating the depression in industry and trade. All the banks show a shrinkage in their current accounts. Fixed deposits, on the other hand, continue to expand. They total £34,180,556, or an increase on September, 1930, of £2,433,288. The growth of the fixed deposits indicates in part retention of funds in New Zealand that for reasons of adverse exchange against remittances would otherwise have been sent out of the Dominion, contributing to the "invisible exports" of other countries, and in part to, the general reluctance of investors to embark in new enterprises or to employ their capital in undertakings giving a higher return than the current bank fixed deposit rates.

Advances, or overdrafts, aggregate £50,224,003, and these have decreased by £1,175,837. It is no secret that the banks haye been reducing their limits of overdrafts, restricting advances, and in some cases calling them up altogether. Only those who have tried know the difficulty (no matter what the security or margin) of obtaining accommodation foi- any newventure or immediate purpose.

Bills discounted amounted to £709,553, and are almost "cut in half" as compared with last year, being £397,508 less. Slackness in trade and heavy reduction in importing will partially explain the deficiency. ■ Necessarily, with heavily • reduced purchasing power on. the part of the public brought about by "cute" in salaries and wages, unemployment, higher taxation, reduced business turnover, and compulsory economy, note • circulation is lower this .quarter by nearly half a million Jess than the. end of September of last year, the notes out being £5,584,542, compared with £6,039,175 in September, 1930, a fall of £454,633.

The aggregate figures for the September quarters of 1931 and 1330 are compared as under:—

. Sept., 1931. £ Free deposits .... 16,500,661 Fixed deposits .. 34,180,556 Advances ! .. 50,224,004 Discounts 709,553 -Note circulation . 5,584,542 Coin and bullion . .6,942,332 Sept., 1930. £ 20,803,171 31,747,268 51,399,840 1,107,061 6,039,175 6,838,877