The Hokitika Guardian FRIDAY, OCTOBER 13. 1022. THE BANKING RETURNS.

Hokitika Guardian, 13 October 1922, Page 2

The Hokitika Guardian FRIDAY, OCTOBER 13. 1022. THE BANKING RETURNS.

Tun outstanding feature of the bunking averages for the September quarter remarks a contemporary, is that on comparison with the position a year ago there has been a very- pronounced improvement in the relation of deposits and advances. A comparison bv

the year in respect of those figures is more informative than are compafmoliß by quarters, liecause of seasonal factors, the demand for accommodation being largely governed hy agricultural and pastoral conditions. Twelve months ago the average of advances for the quarter was some four and alialf millions over deposits. This, of course, was quite serious, though it was explainable by the after-war conditions of production and commerce. The siumtion has changed during the year to such an extent that advances exceeded deposits in the last quarter by only one million, so that the strain upon the hanking resources has been! relieved in the ratio of 4J to 1. This I is an excellent showing, and indicates a greater recovery in a single twelvemonth than even sanguine people might have expected. There is a substantial reduction recorded in free dc- 1 posits—that is. the non-intcrest-ln nr- I iug class—hut an increase in fixed dc- ' posits. For several years during t.W> I booming war time the magnitude of: free deposits was quite astonishing, 1 and it seemed strange that depositors 1 did not seek to turn their halamcs in-J to profit-earning channels. In those ! days, however, mom v came easily mi l . was less valued for that reason. Ah're ; stringent conditions have had their effect, so that there i< less money lying idle, so far as the owners are eon-j corned—for of course the hanking in- , stilutions make use of it. Tlr* re-! striotion of free deposits i-. no doubt,! due also to a contraction of actual funds to some extent ; hut we think a large factor is the transference of balances from the free to the fixed class. The heavy decrease in advances which is revealed in the latesi returns was to bo expected, for the hanks were obviously straining their resources a year ago. Possibly t’o- demand has fallen, and if this is the ease, and the j reason is that, the need of assistance is relaxed, then the country is to lie j congratulated. At all events, the j hanking figures show movements in . healthy direction's. There is an appro-* fin hie decrease in the amount of notes j ill circulation, which, so far as it goes. I lessens the evils of inflation. Altogether, the-stride towards normal and i sounder conditions which is indicated ! in the returns is a larger stride than might have been expected, and consequently, all the more welcome. I