EXTRAORDINARY BANKING RETURNS.

Nelson Evening Mail, Volume XVI, Issue 73, 26 March 1881, Page 4

EXTRAORDINARY BANKING RETURNS.

Tbe following article is abridged from the Australian Insurance end •Booking Rpcord for this month : — ; "The^Vietorian backing averages for the quarter ended 31st December, 1880, . which we present to-day, are in many ] respects remarkable. Overflowing - batik, treasuries are, in the colonies, so exceptional bb to be anomalous, end in a .... quarter of a century's banking we do .'. sot believe that there has been any precedent for the existing financial position. Well applied, sagaciously dealt with, and aided by concurrent favorable circumstances, the outcome of cheap money ought to be one highly favorable to tbe progress snd permanent prosperity of this and tho other Australian colonies The interestbearing or fixed deposits stand Bt almost precisely the same amount (hat they did & year ago. Thus the entire iucreasa is oo fl'e deposits at call, which inclade the doily each balnr.cae af, the credi' of the public The operation of the lowered rate of ir.tereet on deposits is here very clearly displayed. Those who are ordinarily bank depositors ere not inclined to accept the lower interest rates offered them. They prefer to place the proceeds of their deposit receipts to their credit on open account until they bave found some eligible outlet for investment. Thus, in the meantime, the result it not unfavorable to backere. For not only are tiey paying a lower rate of interest oo the same amount of fixed deposits which they held a year ago, but they have possession of an averege increase of over a million and a half, for which tfhey are paying no interest at ell Furthermore, from a public standpoint this condition of affairs is encourftging It is an evidence of increase of national wealth, mainly traceable to the prosperity of the three great producing interests of the couDtry — wool, gold, and wheat. The produce of the teemiog soil of Victoria, less the cost of obtaining ir, can be easily traced iDto the depoßit accounts of the biuks' customers. That no fortuitous cuubb has led to the increase of deposits may have been con- ; eluded from »he fac; tbat every back oan point to more or less growth ia this department of its busin &\. With o eiDgle unimportant exception, evory bank in v Victovia shows a coin increase on the quarter, except the institution natxsed, but, which in..siitudori, however, still holds a for larger stock o) erin than any other bernls — iodef»<! one-fi ; tb of the whole. • I Lr'i'itv.s ;he in.M'j&Sr on the year U £124,890 ami oi> the quarter imma e»ii. Advances (m all debts due to the bqnks) furnieh at present the most strioua aoxiety to bunkers — not, „. bb is usual, because of tbeir magnitude, but. from their persistent diminution. There is a decline ou the qunrter of ' l "-£744 911 ; oh tb« year, the faUing-off is £2,678 930; and as compared with two yet.rs ago, the contraction is equal to £4,391,309. No wondt r that bankers are s&kiog themselves where tbeir future dividends are to come from ! The causes which have led up to this singular result bave been before pointed out. They are mainly (1) the vest icflux of British capital through the finance companies, which have thus been able to take over many of the larpe pnßtoial advances formerly made by tbe banks ; (2) the increase of local resources, as shown in the d< posits; (3) tbe greater iudepondenca of aid in the equatting and come other sections of tb- 1 commr.rri;?; nnd (4) o dearth of entrrprisp, eepeois!!? in oocpfction will) buii'.!ir>£ iip.fi rr-al efitafp, arising from a BFnne of f oliiical insecurity which certainly exists — whether justly or cot we shall not uodt-rtpka to decide ia s statistical article such aa this ie. This me may say, that if political moderation is praofieed sb it is promised, it will not be loDg until lanced securities acquire a more readily realisable value than they now possess. However anxious tbe times for bonkers in search 1 of dividends, the prospects for tbe general public are brilliant. They will meet no refusals if they bring reeooable proposals to tbe bank managers. Applicants may remember that not only are there large amounts available in the colony, but tbat the backers hold (temporarily occupied), in LondoD, abundant resources which they are prepared to employ permanently in the cdocies if tbe encouragement of borrowing on legitimate seourity ia cflfarpo' to them. •