The Feilding Star. THURSDAY, AUGUST 6, 1891. Bank Failure

Feilding Star, Volume XIII, Issue 16, 6 August 1891, Page 2

The Feilding Star. THURSDAY, AUGUST 6, 1891. Bank Failure

The failure of the Bank of Van Dieman's Land is one of those events wLioh always take the outside public by surprise. After the disclosure has been made by the actual stoppage of payment, we are told that this had been regarded as an event likely to happen at any time during the past year or t<.vo ; but, that knowledge could only have been shared among the other rival institutions, and not until, perhaps, the eleventh hour by the depositors and holders of notes issued by the bank. In order to keep up the apirits of the unfortunate shareholders, a dividend of nine per cent was declared in June last, and, as was perfectly excusable under the circumstances, those who were intended to be hoodwinked, were made to believe the affairs of the institution were in a very satisfactory condition. We notice by the telegram, that a point is attempted to be made against the other Banks because they withdrew £33,000 which, although the the telegram does not say so, would be in gold. The explanation of this is very simple, and does not in the slightest degree indicate an act of hostility against the Bank of Van Dieman's land by the other banks. When the holders of deposit receipts, notes, or persons whose operative business accounts were in credit, had the first hint that all was not right, they would, as an act of self-protect-ion, make transfers to the other banks which were looked upon as more solvent, with ithe result that when the settling day with the banks for the exchanges came, the balance would be against the bank from which the withdrawals were chiefly made. The statement that the failure was brought about by making advances against the scrip of other banks, is not likely to be correct. It is probably meant that mining scrip was accepted as security, which is a very different matter. That opinion is -justified by the fact that several of the Zeehan silver mines will have to cease work at once. If we may accept the figures telegraphed as correct the public are not likely to lose much, but the unlucky shareholders will suffer heavily.