LOWER INTEREST

Hokitika Guardian, 10 June 1932, Page 2

LOWER INTEREST

KATES OF FIXED DEPOSITS. ORDERS-IN-COUNOIL GAZETTED. (By Telegraph—Per Press Association.) WELLINGTON,, June 9. Orders-in-Council under the National Expenditure Adjustment Act, have been gazetted providing for the maximum rates of interest that may be paid for deposits by Savings Banks, Building Societies, Investment Societies, and trading companies, to be operative from July Ist. They are:— Savings banks, including the savings bank departments of building societies : Three and three-quarters per cent. Kates for fixed deposits are, as follows for building and investment societies : At call (less than three months): Three per cent. Three to six months: Three and a-half per cent. Six to twelve months: Three and three-quarters per cent. One year to two years: Four per cent. Two years and over: Four and tt-half per cent. The rates for stock and station agents fob similar periods to those above mentioned hre respectively i At Call, 3; 3 to 6 months, 3) pet cent, j Q to 12 months, 4 per cent.; twelve months to two years, 4$ per cent, j two years and over, 5 per cent, In the ease of building and invest, ment societies these maximum rate® are applicable to the, renewals of the existing deposits. Stock and station agents, however, are given the option in dealing with renewals, during the next twelve months, of paying either the rates specified or rates one-half per cent, lower than the rate payable before the renewal. Deposits from the shareholders and staff of stock and station agents are exempted from the operation of the order. In the, case of trading companies, the deposits do not include contracts or agreements expressed in mortgage, or other instrument, by way of security or in company debentures. Moneys received in the course of mercantile current accounts are ateo exempted.

An explanatory statement has been issued by Mr Downie Stewart. Commenting on these Orders-in-Council, the Minister of Finance stated that the maximum rates prescribed, except in the case of savings banks, applied only to new deposits and to the renewal of existing deposits. The rates fixed for the building societies and investment societies are, for comparable periods, a-half per cent, above those recently announced by the Associated Banks. The maximum rates for the stock •and station agents art, lit tiitn, a half pet cent, above those for ; {be tmildiiig Olid invastfnent’ vsocietiea,

“These rates,” added the Minister, “wore decided upon as being equitable to ail concerned, after a careful re* view of all the available information, and considerable discussion with the interested parties, AVhile the Government is anxious to bring down interest rates, it does not desire to discourage savings, or to diminish the funds available for financing trade and industry. No limitation of interest rates has yet been applied to the deposit,? accepted bv merchants and trading companies, apart from stock and station agents. The reason for this is a lack of information as to the rates and terms of the deposits at present held by trading companies generally. Although it is known that the practice of accepting deposits is fairly general, very little information was supplied in response to a public invitation. Under these circumstances, the Government might, perhaps, have been justified in proceeding without more ado to fix maximum rates for all trading companies, but, as it ia not desired to hamper trade any more than can possibly be helped, it is deemed advisable to hold this matter over until the information that is contained in the first lot of returns of the deposits, required under the Act, has been analysed and reviewed.”