The Dominion. MONDAY, OCTOBER 21, 1907. THE BANK RETURNS.

Dominion, Volume 1, Issue 22, 21 October 1907, Page 6

The Dominion. MONDAY, OCTOBER 21, 1907. THE BANK RETURNS.

We are indebted to the chief officers of tlie several banks for advance copies of their quarterly statements for ' the period to September 30. The figures'are of unusual interest at- this juncture, and the movements as compared with the corresponding quarter of last year are striking. The banks show i a wonderful expansion of business in the twelve months, as will be a . comparison of the assets and liabilities: , Sept.,'os. Sept.,.'oo. . Sept., .'O7. Liabilities «£22,232,:W0 £24,375,817 £20,070,871 Assets ... £23,958,537 .£25,385,970 E h"biUtL - £555,428 £1,284,901 It has now become almost a fixed matter for some of ( the banks to employ their resources outside of the Dominion. To this there can be no objection, for it is incumbent upon bankers to make the;best use of the funds at their disposal. Short-dated loans in London have offered a wide and profitable scope for funds, and bankers are taking advantage of their opportunities. The local conditions are best seen by the advances and The advances show the substantial increase of £1.897,267, as compared with , the Sep- ! tember quarter of last-year, and all the banks have shared., in this movement, as the following table will show: — Bank. Sopt., '07. Sept., '06. Increase. Now Zealand £5,999,870 .€5,132,912 £866,964 Union Hank ,82.91)1,735 £2,3-14,881 .£016,811 New South Wales ... ._ .£2,583,153 £2,477,103 £106,050 Australasia ... £2,580,428 £2,371,93-1 £205,494 National ... £2,372,840 £2,270,922 £101,918 £16,498,032 £11,000,765 £1,897,267 The increase is much heavier than was shown last year, and may.be read as a good or bad sign as one chooses. The increasing dependence upon the banks is no doubt duo to the exhaustion of private capital, and the borrowiug may be due to pressing wants; on the other hand, it is not unreasonable to suppose that the money obtained from the banks is being profitably used by the boirowers, that is to say, that there is still scope for enterprise, but, to exploit which, capital is needed/ The high ' prices of commodities are another factor. The .discounts for the quarter once again exceed the two-million mark, a aud this is the third time in seven years that this mark has been passed in the September quarter. Compared with 1906, there is an increase of '.' £28,026 in the amount of the discounts, which hiis been secured by the three Anglo-Colonial institutions, the Bank ' of New Zealand and the National Bank exhibiting decreases. Comparing the v figures of each bank we get the following:— Increase.* , Bunk. Sept.,'o7. Sept.,'oo. Dec'se.t Now Zealand ... £870,921 £572,528 £1,802+ ■• Union Bank ... £213,233 £180,703 £20,530* N.B. Wales ... £277,012 £273,978 £3,031.* Australasia ... £321,101 £319,878 £1,583* National £1116,825 £319,041- £2,U9i £2,000,152 £1,972,126 £28,026" The Union Bank shows the heaviest actually and relatively, while the gain

in advances is relatively greater than any of tlie other institutions. An interesting table is presented in comparing the advances and discounts of the September quarter for a period of years. The table is as under: — Sept. 30. Adviinces. Discounts. Totals. l!l[)l .„ „. £10,180,012 £1,863,537 £12,050,119 1902 £10,778,512 .£1,717,093 £12,252,005 1903 ,£11,590,135 .£1,895,032 £13,491,107 I!I(H £12,403,933 £2,030,626 £11,491,550 IMS £13,2.v8,597 £2,107,833 £15,3CC,520 • 1000 £14,000,705 £1,972,128 £10,572,891 1907 ... •'... £10,J'J8,032 £2,000,152 £18,498,181 The figures show that to carry on the trade and commerce of the Dominion £6,448,035 more bank accommodation is needed now than six years ago, and £4,003,025 more than was necessary in. 1904. , The increase is Now we come to the deposits, and it is satisfactory to , note that the free deposits continue to expand, although the expansion in the past quarter is not as large as was .exhibited last year. There was an increase of £1,296,641' in the amount of tho free deposits, as com- , pared with the September quarter of last year, and in this all the banks shared as the following tabulation shows:— Bank. Sept.,'o7. Sept., 00. Increase. Now Zealand... £5,387,151 £1,893,838 £193,313 Union ... ... £1,801-091 £1,578,829 £225,262 N.S. Wales ... £1,575,11.2- £1,398,298 £176,811 Australasia ... £1,382,432 £319,878 £1,583* ; National . „ £1,808,114 £1,041,070 £107,311 ■ £11,957,200 £10,000,559 £1,296,611 While the position with regard to the free' deposits is satisfactory, the same cannot be said of the fixed deposits. Compared with the September quarter of lboG, the deposits bearing interest are less by £252,999. That is, the banks are losing deposits, while at the same time they are called upon to provide ■ increased accommodation for traders and business men. The Bank of New Zealand was the only institution to oxhibit an increase of fixed deposits,- as the following table will show , :—' ■ -. Increase.* Bank. ' Sept.,'o7.; Sopt.,'oG. ■Dee'se.J New Zealand £4,000,024 £4,»G4,343 £95,681* Union- £1,386,282 ,£1,583,125 £19G,8«t K.S. Wales ... JE1,G15,901 '£1,075,301 £29,400f Australasia ... £5(15,018 £043,913 £78,925t National ... £1,4-10,518 £1,484,030 £43,512f £9,097,803 £9,950,802 £252,9991 The banks are suffering in the matter of fixod deposits, from the competition of the Post Office Savings Bank, Building Societies, and in no small degree from trading companies, especially the co-operative concerns. The acceptance of deposits by trading corporations is a '■ matter that must be faced sooner or later, for Avhile the banks are .bound and restricted these other concerns are ■ free to do as they please, and in the event of a crisis there will be trouble j for many. Of course the banks can, J by raising their rates, attract deposits, : but any such movement must inevitably lead ,to dearer money, for the rea- ■ son tha,t if the banks haye to pay more ! to those who lend to them, they must ' charge more to those to whom they lend. The aggregates of the free and fixed deposits for the September quarter of ; a series of years show as under: — Sept Free. Fixed. Total. 30. ' Deposits. Deposits. Deposits. 1901 .* *- £7,007,003 £8,215,334 £15,282,337 1902 u. ;~ £7,912,954 £8,001,878 £10,574,832 1903 ... £8,83i;327 £8,808,556, £17,702,883 1004 ';„ ;~ £8,996,885 £5,950,358 £17,947,213 . 1905 :„ „' £9,180,019 £9,493,913, £18,073,992 " 1900 ;_ ... £10,000,559 £9,950,802 £20,011,301 1907, ™ •„ £11,057,200 : £9,697,503 £21,055,003 The note circulation and the coin, and ; bullion both show increases which are satisfactory and in keeping with tlie other movements., These two, items for a.series of years show as under:— Sept ,■■■< : ~ , •■ Coin and 30 •/. Circnlnhon. bullion. " 1901 - _ - - £1.,325,553 £3,030.015 5 1902 ... ... £1,347,507 £3,234,950 i- 1903 "Z T £1,420,290 £3,722,695 i MOt'.. ~ ... £1,420,938 ~£.1,921,930 - 1905 ~ .« £1,427,547 £4,022,318 3 1900 Z. ... _ ... £1552,682 £1,727,953 I 1907 £1,594,661 £5,003,839. E Reviewed as a> whole the returns are j satisfactory, as they show the country l to be.enjoyiug prosperity, with-trade, i commerce, and industry active. The' : only danger to this happy state of affairs is the possibility of being drawn i into the financial trouble now affecting 9 Europe and I America..'