BANKING REFORMS

Dominion, Volume 31, Issue 269, 10 August 1938, Page 14

BANKING REFORMS

Australian Legislation POSTPONEMENT LIKELY There is a strong likelihood of the Federal Government postponing until next year the introduction of the legislation giving effect, to the recommendations of the Banking Commission, according to a Canberra report. Chief of tlie reasons which would prompt this decision is the anxiety of the Federal Government to avoid hostility m the ranks of its supporters against any phase of the propo-ed legislation in view of the pending £70.060.000 conversion loan. The proposed banking Bills, it is understood, will be in two forms one establishing a mortgage bank and the other dealing with the recommendation of the Banking Commission that private banks lodge part of their deposits with the Commonwealth Bank. In view of the election promise of thcI’rime Minister pledging the Federal Government to legislation “to strengthen the banking structure." the Government now finds ifiself in an awkward position. . If it proceeds with the promised legislation it must face opposition within its party ranks to compulsion on private banks to lodge portion of their deposits with the Commonwealth Bank, while abandonment of this phase of legislation would invite the charge from the Opposition that the Government was pandering to the interests of the private banks. Opposition to the recommendations of the Roval Commission on banking with regard to the transfer of any percentage of deposits nt present being held by the trading banks to a central bank being given effect to was expressed last week by Mr. R. J. Hawke in his presidential address to the Sydney Chamber of Commerce. He thought there would be ample time for every section of the community to consider what might certainly be a threat to the present banking system of the country, the system which hitherto had withstood the depression and emerged with added strength.