BANK CLOSES DOORS

Dominion, Volume 24, Issue 282, 25 August 1931, Page 9

BANK CLOSES DOORS

An Australian Institution LIQUIDATION IS PLANNED (Rec. August 25, 1 a.m.) Sydney, August 24. The Primary Producers’ Bank of Australia, Limited, with its headquarters in Sydney, and branches in other States, has suspended payment as from to-day. The shareholders are to be recommended to place the bank in voluntary liquidation. The Chairman of Directors, Mr. 11. Schwieger, announced to-night that if the bank’s securities realised anything like the bank’s valuation all depositors ultimately should receive twenty shillings in the pound. Unprecedented Difficulties. The bank, which was established in 1923, encountered unprecedented difficulties, he said, accentuated by the pronounced fall in the values of wheat and other primary produce, the marked reduction of security values, such as country lands, and the necessity for maintaining advances to farmers; also steadily declining deposits, a lack of adequate capital, and the inability to obtain temporary accommodation or to amalgamate with any other financial institution. No Alternative to Move.

While most of the bank’s clients are unable to reduce their indebtedness iu the slightest degree, there is no alternative. added Mr. Schwhieger, but to close the bank’s doors. _ - ' The bank’s paid-up capital is £439,401. The deposits at the time of the ‘last bal-ance-sheet, in February, amounted to £1,483,845, and its assets totalled £2,102,443, of which bills discounted, loans, advances and other assets accounted for £1,592,318. The bank, held £376,OSG in liquid assets, including £37,890 in cash,'£92,ooo at short call, and £145,678 in Commonwealth bonds.