The Daily News. WEDNESDAY, JUNE 17, 1914. THE BANKING MONOPOLY.

Taranaki Daily News, Volume LVII, Issue 23, 17 June 1914, Page 4

The Daily News. WEDNESDAY, JUNE 17, 1914. THE BANKING MONOPOLY.

There is a good deal of food for reflection in the balance-sheet of the Bank of New Zealand and the statement made in respect thereto by the chairman of directors. Most people will agree at once with the latter's observation that the position disclosed "must be regarded as very satisfactory"—for the shareholders of the Bank. The. net protits were a trifling £308,490, after making very liberal allowances for depreciation of premises, bonus to the staff, grant to the Bank's provident fund, etc. From the surplus the directors recommended the payment of a dividend on ordinary shares of a total of 15 per cent, (three per cent, being described as a ''bonus"), and 10 per cent, on preference shares. This will absorb £125,000. Of the remainder, £175,000 is to be transferred to the Reserve Fund, and £51,608 carried forward. It will thus be seen that the earnings of the Bank were large enough to permit of the payment of a dividend of not ten and fifteen per cent., but twenty and thirty per cent., with something substantial to spare. The thought must occur to the ordinary observer, Is it right that the Bank should go on bleeding its customers in the way revealed by its own figures? Is it in the best interests of this young country, whose people are clamoring for financial assistance, that the State should give one bank all its business and to participate in the profits itself? A stronger argument for the starting of a State Bank than the position and doings of the Bank of New Zealand could not be supplied. The Bank has for years been building up a strong reserve, which now stands at £1,550,000. This huge sum has all come out of profits, out of customers' pockets. No doubt it is an admirable thing for'a bank to have strong financial reserves, but shareholders might reasonably be asked to find the money, or the major part of it> themselves, instead of looking to the Bank's customers to provide it all. If any other semi-public utility concern were to exact Buch a large profit, there would instantly be an outcry for State competition, but none of our Governments have had the courage and independence to tackle the banking monopoly that flourishes so amazingly in this country. Banks seem to be "tapu" to most of our politicians, who are more concerned with pettifogging personalities and trivialities than, say, effecting a real reform in our banking system, whicn is crying out loudly for rc-adjusfcment, in a way that will give real practical and timely help to our struggling small producers. The Advances to Settlers is certainly of some service to this deserving class, but it does not go far enougli. As for tho Banks, they take no chances; theirs must be "safe" business. At the very time help is needed? that is just when the Banks draw in their horns and are adamant. If a working man has a £lO note, the State will erect him" a home to the. value of £450, but it does »ot accord tho producer anywhere near the same liberal treatment. And is the producer not just as deserving, if not more so? It is no exaggeration to say that there are hundreds of men in Taranaki to-day to whom an advanco of a further few hundred pounds, either by the State or by a Bank, would mean tho difference between success and failure, between comfort and discomfort, between contentedness and discontentedness. If it were not for the accommodation given by the auctioneers they simply could not coiitinue operations. A better system of State finance woulfl utter this, make for the increasecr development of our country, singe the wings of the present banking monopoly, and result in a contented .and prosperous yeomanry. The occasion calls for a strong man, able and fearless, with plenty of initiative, not tied hand and foot to any financial institution, who can promulgate a practical banking scheme, and have tho determination to carry it through to a successful conclusion".*