A NEW BANK.

Auckland Star, Volume LIX, Issue 174, 25 July 1928, Page 8

A NEW BANK.

GOVERNMENT NEUTRAL

" WHO IS BEHIND IT 1" BILL GOES TO COMMITTEE. (By Telegraph.—Parliamentary Reporter.) WELLINGTON, Tuesday. The Minister of Finance informed the House of Representatives, when the London and New Zealand Bank Bill was under consideration, that the official attitude will be one of ensuring the protection of the public and offering no objection if the necessary safeguards are provided. Mr. J. G. Elliott (Oroua) formally moved the second reading of the bill, and did not discuss it as the next procedure was to refer the matter to a Select Committee for inquiry and report. The Leader of the Opposition (Mr. H. E. Holland) asked what was to be the Government's attitude towards the bill. If the Government took up an antagonistic attitude, any discussion by members would be merely wasted time, therefore the House was eititled to know at once what would be the position. The Hon. W. Pownie Stewart. Minister of Finance, pointed out that the bill was a private one not sponsored by the Government. His view was that the correct time to discuss its merits was on receipt of the Select Committee's report. "I have intimated to the member in charge of the bill my personal view that if a responsible body of citizens wish to start a bank and if they incorporate in their bill the ordinarv legislative provision' designed for the protection of those doing business with the bank and also, of course, satisfy the committee that the capital is behind it and their banking facilities are reasonable. it i« not the dutv of the Government to obstruct the bill in any way." " Not Without Resistance." I Mr. Veitch (Wanganui) expressed the opinion that the bill ought to be discussed at once. If it passed in its present form the Government would have no say in authorising the new bank. When the Colonial Bank Bill was passed the bank's capital had already been subsidised and the names of the promoters known. There was no such information available in connection with the new banking proposal. Mr. Elliott: Are you opposed to this legislation ? Mr. Veiteh: I am just expressing my opinion. This measure is not going through without resistance unless the necessary information comes to hand. Half a dozen new banks, he added, would not break up the present monopoly. The only way of doing so was to widen tlie banking laws so that any corporation created within the law and having sufficient capital to safeguard the public interest should be allowed to compete against the existing banks, as was the case in the United State*. The Hon. A. D. McLeod: Tt's a common thine for some hundreds of them to go bankrupt. "Plenty of Customers." Mr. Veitch retorted that there was no danger of the banks going bankrupt, though thousands of their clients had been in that position while the banks ccntinued to make profits. As the bill gave an exclusive right to some unknown promoters to start a bank and raise capital with commission autlior- | ised up to £00.000, they were asking for a very valuable consideration. Agricultural banking would be preferable to the proposal. He predicted that the proposed bank would be unable to carry on without becoming associated with existing banks. Mr. W. S. Glenn (Rangitikei) said if the bill were to reach a stage where the backers and promoters could come forward and establish their bona fides, then the House would know who were behind it. Tt was most unlikely that the Government would allow a wihl-cat scheme to go through. Mr. Glenn welcomed the advent of any in-stitution which would mean extra capital for New Zealand. If this proposed bank was a genuine concern with the proper baek- , ing it would get customers quickly , enough. At this stage Mr. Glenn could see nothing to worry about. The bill was read a second time and sent to a committee of selection.