LOWER DEPOSIT RATES.

Auckland Star, Volume LXIII, Issue 160, 8 July 1932, Page 8

LOWER DEPOSIT RATES.

AUCKLAND SAVINGS BANK. ORJ>ER-IN-COUNCII< OPPOSED. PROTEST TO MINISTER. On the ground that the action is highly detrimental to the email depositor and a discouragement to thrift, the board of trustees of the Auckland Savings Bank has passed a resolution emphatically protesting against the recent reduction by Order-in-Couneil of the deposit rate to 3J per cent. The terms of the resolution have been forwarded to the Minister of Finance, together with the following comment: "The letter dated June 16 from the Minister of Finance, with reference to the compulsory reduction of interest on savings banke' deposits, was duly discuseed by the trustees. It is considered that the comment of the Minister that the trustee savings banks, savings departments of building societies, and the Post Office Savings Bank, should be complementary arid not competitive, must eurely force recognition of the fact that these other institutione have advantages not possessed by the trustee banks, both as regards the limit of deposits <Jn whidi interest may be paid, and in the nonmaintenance of liquid assets to the degree imposed on the trustee banks. The trustee banks were all established long before the Post Office Savings Bank and many years before the buildingsocieties, and in general (in particular in the case of this bank) have consistently paid a higher rate of interest than the Post Office Savings Bank, principally due to the accumulation of strong reserves, and with the desire to give the best return possible for the encouragement of thrift. "The reserves of the Auckland Savings Bank would enable an interest rate of 4 per cent to.be paid, but the rate has been arbitrarily fixed at 3J per cent for reasons which are not considered satisfactory. Urder the circumstances, the depositors have every right to proteat, and my board respectfully requests reconsideration of the interest rate, with a view to fixing it at 4 per cent as from April 1."