BANKS’ RESERVE CAPITAL
What is the reserve capital of the hanks in Australia and New Zealand? The question was asked of the “Sydney Bulletin,” and the following answer was given : Reserve capital is not in the hands of the banks, and can be called up from the shareholders only in the event of liquidation; that is, it is for the final protection of depositors and other creditors, and meantime is to be left where the misfortunes of the hank cannot touch it. Reserve funds are made up of (1) undivided profits, and (21 premiums on new share issues. Except in very rare eases they are not invested separately, but are used in the business, being lent on overdraft, etc. At its last balance the great Bank of New South Wales had £0.130,000 of reserve funds, besides £335,877 of unappropriated profits. Yet a’/t tho coin and bullion it had, according to tho last quarterly averages, was £261,806. along with £2,683,941 of notes and cash at the Commonwealth Banks this was all the unused money it had among upwards of 550 branches. And at that time it owed £85,299,110 on posit, over 11 millions of it at call,
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Hokitika Guardian, 2 March 1931, Page 2
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196BANKS’ RESERVE CAPITAL Hokitika Guardian, 2 March 1931, Page 2
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