BANK INTEREST BILL

Evening Post, Volume CXI, Issue 72, 26 March 1931, Page 13

BANK INTEREST BILL

FEDERAL CONTKOL

SANCTION IMPOSED

(Received 26th March, 11 a.m.)

CANBERRA, This Day

The Federal Treasurer, Mr. E. G. Theodore, in moving the second reading of the Bank Interest Bill in tlio House of Representatives, said that if interest rates wcro reduced one per cent., industry in Australia would save about £4,000,000 a year. In the discussions with the Government tho banks had raised no objection to tho principle that interest rates should bo reduced. Tho Government, however, was unable to accept dictation from the banks as to its policy, and because tho banks failed to take the initiative in reducing interest rates, tho Government found it necessary to proceed with this measure. A line of £1000 was provided for as a penalty for charging a rato in excess of tho maximum, under the Bill. One proposal in the measure is that a board of five members be appointed Avith power to make recommendations to the Treasurer in the following directions: —- (1) The maximum rate of interest which is to be payable within the Commonwealth on bank deposits lodged with the banks and on. advances by the banks by the way of loans or otherwise, and (2) The maximum discount rate which is to be charged by banks on bills, drafts, and other securities.