THE STATE AND BANKING.

Wairarapa Age, Volume XXXII, Issue 10002, 24 March 1910, Page 4

THE STATE AND BANKING.

An important report has been prepared by the Banking and Curency Committee of the British Association of Chambers of Commerce, arising out of which soma interesting recommendations will be discussed at the jubilee meeting of the association, which opened on Wednesday last, in London. The committee recommend that, in view of the fact that an opportunity for the revision of existing arrangements between the Bank of England and the State will take place in March of next year, the Government should nominate a committee to consider and advise as to how far it is desirable to modify such arrangements in the interests of the State. Also, that fuller information should be available to the public periodically, say monthly, as to the figures of all banka, showing their immediately available resources in detail, stating separate discounts, advances, balance with bankers and also their liabilities stating separately deposits and current accounts, acceptances, etc., cash in hand, cash at the Bank of England, and cash at call and notice. These figures should be. trade up on the average of the daily balances. The committee also propose that the Government should hold a reserve in cash, against the deposits in the Trustee and Post Office Savings Banks, suffiicent to provide means for meeting any probable sudden demand on the part of depositors, thus avoiding the necessity, in such a case, for putting pressure upon the money market in times of difficulty. Another interesting recommendation is that the Bank of England should issue £1 notes, under similar conditions to the notes now issued, so as to increase the proportion of coin to securities held m the issue department, but with the proviso that such £1 notes may be. issued four-fifths against bullion and one-fifth against securities, so as to provide for the expenses of issue. It is also proposed by the committee that the ordinary reserves of gold having been increased by the measures suggested, the Bank of England, on the recommendation of a committee representative of the State the bank, and the join stock banks, should be given an increase of ".its powers of issue against securities in times of emer gency, on payment to the State of a rate of interest to be fixed by law, such rate of interest to be neither so high as to make the permission imperative, no so low as to encourage speculation up to it.