DOLLAR CREDITS.

Taihape Daily Times, Issue 219, 15 November 1916, Page 3

DOLLAR CREDITS.

EXPLAINED BY MR. BEAUCHAMP. WELLINGTON, last night. In order to facilitate trade between New Zealand and the United States, Ihe Bank of New Zealand some months ago arranged to issue dollar credits instead of or alternative to sterling money. An explanation of the system was given by Mr. Harold Beauchamp, Chairman of Directors of the B'ank of New Zealand, on his return last evening by the Niagara from a visit to America and Canada. Lie said that the new system would obviate the necessity of financing on the London market, as heretofore. In the past, for the payment of goods imported to New Zealand, it was customary to draw on customers in New Zealand for letters of credit established through London banks. Under the new dollar credits’ system, payment is made by the representatives of branches of the Bank of New Zealand in various cities in America and remittances to provide for these are made from New Zealand to the States, either by"telegraphic transfer or other wise. “I do not take any * credit,” Mr. Bea.uchamp said, “for inaugurating this system,, as provision was made for it prior to my departure from New .Zealand. I found both in the IJnited States and Canada that the altered system was greatly appreciated, and that it would tend to facilitate trade between both countries and. New Zealand. In conversation with several New York bankers, I was led to understand that when conditions had again become normal it would be more convenient to revert to the old system of financing. The alteration in the manner of financing is due to trie fact that America for the time being ? s thp creditor nation, with the result that, owing to large accumulations of gold in New York money in that city is to-day appreciably cheaper that what it is in London. When I left Vancouver on October 25 the rate for call of money in New York was from 2 to 21 per cent., as against 5 to 6 per cent, in London.”