BANKING.

Taranaki Daily News, Volume LII, Issue 216, 18 October 1909, Page 4

BANKING.

THE (jUAIt-TERLY RETURNS. The returns of the banks trading in New Zea'and for the quarter ended on 30th September last are now before us. Ordinarily the returns for this period indicate an increase the indebtedness of the customers to the banks, with (probably) a decrease in the volume of deposits. The reasons for these movements are, firstly, that in the September quarter imports always, or nearly always, exceed the exports in total valu-, and, secondly, that in this period tiie farmers begin to draw money for the expenses of handling the products of the season. On the present occasion, siowcver, other factors have been in operation which have brought about unexpectedly favorable results. We will first consider the changes 111 the summarised totals in comparison with the figures of the June quarter. Appended are the totals under the most important headings in the two returns: Juno Septcmbir Quarter. Quarter. £ £ Deposits, free .. 10.8112,070 10,530,370 Deposits, fixed .. 10,039,08» 10.448,74'J Deposits, Govt. .. 1,142,038 1,428.034 Discounts .. 1,007,253 1,777,425 Advances .. 17,075,128 111,31)3,281 •Note circulation .. 1,023,071 1,525,554 Coin and bullion.. 4,050,114 5,028,400

The movements are a little remaniable. The free deposits show a fallim; oil' of £302,300, while the fixed deposits have increased by £4011,600, a net ga*M of £47,300. The Government deposits are also heavier by £285,1)00. On the other hand, the advances, both discounts and loans, show a sensible decrease, tlio aggregate shrinkage being £871,675 in the three months. The only thing that points to tlie reducing effect of an excess of imports or of advances against wool is the reduction of free deposits. Against • this, however, there is the increase of fixed deposits and the reduction of advances. We do not yet know how the exports and imports of the quarter will compare, -i year ago in the same quarter there was an excess of £2,000,000 in the imports. By the aid of increased exports and 'eouced imports the excess, if any. will this year be much less. According to interim returns the increase in exports will not exceed some £300,000, but the falling off iu imports, though substantial, can hardly be expected to reach £l-,700,000 so as to make the two tables equal. There have however, been factors operating for an improvement. Firstly, the excess of exports, in the first ?ix months of 1909, amounting to ■ £5,500, 000, was not fully reflectccf in the bank returns to 30th June. As these returns represent the averages of the throe months, the full effect of an improvement may not be seen till the following quarter. Another factor, and ma Important one, is that both the Goverrment and the local governing. bodies have of late r oeen obtaining funds from outside instead of absorbing the spare cash of the Dominion, as had been done for the previous four or five years. We liavo recently learned that Sir Joseph Ward when in London obtained and sent out a. million of money, partly for advance!. to settlers and partly for public works. I'rior to that we also learnec that local public bodies had raised loans in London to the extent of a million or over. These bodies, as funds came to hand, would thus be enabled to repay their bankers the amount of advances made in anticipation, and even to deposit the unexpended balance pending completion of works. This would explain both a decrease of advances and an increase of deposits. At the prcse it moment -we regard the movements of th-: lecent quarters asi of greater interest and importance than that of yearly comparisons; The hitter, however, have their value and we will now compare thi. quarter Just completed with the corresponding quarters of previous years, liistly, assets and liabilities compare as follows: