OUR LOCAL BANKS.

Grey River Argus, Volume XV, Issue 1813, 28 May 1874, Page 4

OUR LOCAL BANKS.

Referring to the establishment of the new Colonial Bank in New Zealand, and to the several Banks at present in this Colony, the Otago Daily Times says :— Of all the five Banks at present operating in our midst, no less than three are, to all intents and purposes, levying a tribute upon New Zealand, and are annually taking from our wealth large sums of money, to be spent y the proprietors of stock elsewhr re. The other two are more or leas owned in the Colouy, nnd the comparatively large success which has attended thrm shows how warnolv the feeling of : patriotism enters in»o such matters, and how instinctively the business world here lias a tachrd itself to those institutions whic have a proprietary residence in New Zeal nd. Treating of" the Laws of Interchange among Nations." Air Mill has tainted out the f.cf that *'• rtmi'tahce to absentees are often very inconvctly likened in their general character to the pa\ment of a tribute, ; from which they differ in this very material circumstat'ce, tlikttribute, if nit piid to a foremn country (i.e. if nor. sent, from part to auother <>f the same country) is not paid at all. The two kinds of payment, however, have a perfect resemblance to each other in certaiu effects." To all intents and purposes the resemblance is compiete between a tribute paid by a conquered territory. to its conqueror, and the interest or profit upon Bank Loans renvtted by.New Zealand to Australia. : Probably five sixths of our readers will be " surprised to learn " how largely this Colony contributes to the prosperity of her sisters-in-law on the other side. An enormous sum surely was paid by this Colony to the proprietary of the three foreign Banks, when, according to the Gazette returns up to 31st December, 1873, they were enabled to pay dividends at the rate of 15, 13, and 10 per cent, per annum respectively. The amount over which' the Onion Bank of Australia has the .control, but which belongs to this Colony, calculated upon the basis of it 3 Notes and Bills in circulation and Deposits, interest-bearing or not, is just over one million, and to this extent they can tyranize over our commerce. The Bank of New South Wales controls our money, something like L 970,000. To the Bank of Australasia we entrust the manipulation of the smallest sum, but its power over our monetary transactions amounts to a trifle of L 234,000. The aggregate may fairly be stated at two millions — no less. What do we get for this ? The answer is indeed plain* We get nothing but a position of danger to our own mercantile and industrial undertakings; a position the more critical — the more dangerous — that it is impossible to say, when, or how, or why the blow may be struck, and every business in the Colony hampered or even ruined by causes beyond our control or calculation. To obtain such an object we are Bending money home to England for investment, and, with a charity that neither begins nor ends at home, are subjecting ourselves to a self-denying Ordinance rivalling that of the Commonwealth. Every merchant knows the danger of having au enormous Overdraft at the Bank. So long as things go right, all may be wellj but directly a monetary pressure Comes, no matter how good his securities may be,' he finds his profits swallowed up and the stability of his business, imperilled .by a rise in rates of interest and curtailment of his legitimate supplies. . New Zealand is i exactly in the position of a merchant who has got in with the Bank too deeply. This additional peril is hers. A Bank locally owned may find it good policy not to "put on the screw " too tightly j 1 the wheels; within wheels that we all wot of are apt to get clogged if this be done. What mercy could the Colony expect if there wereVa panic in the money market in Sydney, Melbourne, pr even in the Murrumbidgee 1 None whatever. The New Zealand establishments are mere country branches to them. Directly a tightness is felt there, ewers will come over tore-

trench here. Such things have happened, Miid will happen again. It is true when money is plentiful our funds may be left at our own disposal j and only a tribute required of us. So much, the worse. It is heads I win, and tails you lose. When we want money least we are flooded with it. When our need is sorest, our money will all be called in and applied to the relief of their necessities — yea, even from Wagga W.ag£a to Darling Downs. No sane man can doubt the wisdom of gathering up all our resources within the Colony, and not risking our future upon the prosperity of the other Australian Colonies.