TV set may be interest’

Press, 10 December 1982, Page 6

TV set may be interest’

PA • i Wellington The Government yesterday introduced legislation aimed at stopping finance houses from enticing depositors with the offer of gifts. • . The Prime Minister, ‘ Mr Muldoon, said the bill would also make various., controls, related to credit and interest rates more It will come Unto” force before the end of this year’s session. “There is one t ; specific question that has arisen and that is the practice of at least one financial institution giving, in addition.to interest, a free television set. ■ “The effect of this bill is to make the television set interest,” Mr Muldoon.said. - The Reserve Bank of New Zealand Amendment Bill replaces the existing definition of financial institutions and widens it to ensure that all institutions are subject to the act. ‘ . The definition of interest is

changed .to include “nonmonetary ■ considerations.” The Reserve Bank will be able to specify the maximum and. minimum rates of interest arid give directions to trading banks over acceptances and their maximum "charges.' . . The present system of using an Order-in-Council to control the interest rates of financial institutions, including? trading banks, will be replaced by the use of regu- ‘ lations. Provision is made for fixjpg actual rates of interest, and maximum and minimum ’ rates of interest. Regulations will also be invoked instead of an Order-in-Councii to. require financial houses (other than trading banks) to hold certain specified assets, such as Government securities. The Labour Party z did not oppose the bill’s introduction. It was referred to the Public Expenditure Committee.