COMMERCIAL A.N.Z. gives details of new scheme

Press, Volume CXI, Issue 32774, 26 November 1971, Page 17

COMMERCIAL A.N.Z. gives details of new scheme

(New Zealand Press Association)

WELLINGTON, November 24

The Australia and New Zealand Banking Group, Ltd, announced today details of a new investment scheme involving time deposits secured by transferable certificates of deposit.

Approval for the scheme' was announced last night by, the Minister of Finance (Mr! Muldoon).

The A.N.Z. Bank said the bank would accept deposits for terms of more thar. 25 months.

Amounts would be for a minimum of $7OOO and in multiples of $lOO with no maximum limitations.

Interest would be paid six monthly direct to the registered depositor. Interest rates will vary depending on the term and amount of each lodgement; they wil be favourable to the investor.

Depositors will be issued with a certificate Deposits can be transferred from one party to another by completing a simple form, issued with the original certificate. The

total deposit, or part, may be transferred without limitations, except as to the minimum being $7OOO. The statement by Mr Muldoon said that trading banks had been given permission to accept time deposits secured by transferable certificates of deposit. Certificates could be transferred from one holder to another, but they could not be repurchased by the banks or their savings bank subsidiaries.

This form of deposit had been available in overseas countries for a number of years, Mr Muldoon said, and lit was now believed that it ! would provide a useful avei nue for the investment of J surplus funds held primarily by the commercial community in New Zealand. “It is a modest step forward in the implementation of the Government’s monetary policy,” he said.

To minimise competition with the savings banks, and to avoid any undue movement in funds the minimum amount which could be accepted on each certificate had been limited to $7OOO, while the term of certificates would be for a period of not less than 25 months. To facilitate the develop-

ment of a market in certificates of deposit, official market dealers had been informed that they might hold up to five per cent of their portfolios in this asset.