New Zealand Times. (PUBLISHED DAILY.) MONDAY, JULY 5, 1875.

New Zealand Times, Volume XXX, Issue 4459, 5 July 1875, Page 4

New Zealand Times. (PUBLISHED DAILY.) MONDAY, JULY 5, 1875.

"We are gratified to learu that the Banks doing business in New Zealand have agreed, through their representatives here, to terminate the' ruinous competition for deposits, .which has so seriously interfered, with legitimate business for several months past. The Banks practically revert to the arrangement in force before the competition began. This intelligence will doubtless be welcome to every one engaged in business, as it will release a great deal of capital now held by the Banks on fixed deposit at 7 per cent. While the competition for deposits lasted, capital was withdrawn from ordinary channels of investment, and placed to accumulate through banking agency; the new, or more correctly speaking, the old arrangement, will make it much more profitable for the capitalist to exercise his own judgment in the investment of his money than to entrust it to his banker*. In other words, it will not pay so well to place it at fixed deposit in the Bank, as to invest it on ■ private security at higher rates of interest, which may be readily obtained on adequate security. This will very soon lead to a distribution of the hoard which has been accumulating so rapidly of late. The arrangement, which is to take effect from to-day, is not a moment too soon. Business of all kinds was seriously interfered with, and but for the relaxation which is now possible, disastrous results must have ensued. There is a limit in the rates of discount beyond wliich business cannot be conducted with profitand that limit most certainly had been reached. As a matter of fact, however,' the Banks could not very well help themselves. They adopted a policy which could end only in one way, if persevered in. Luckily for all parties, it is not to be persevered in; and our advice to the mercantile classes is to forgive and forget, although the latter may bo somewhat more difficult than the former. We are satisfied the Banks desire to give the utmost assistance to every legitimate enterprise, and therefore we are pleased to find them putting themselves in a position to encourage, instead of hampering, trade and industry.