SAVINGS BANK WITHDRAWALS.

Hawke's Bay Tribune, Volume XI, Issue 238, 12 October 1921, Page 5

SAVINGS BANK WITHDRAWALS.

QUESTION IN HOUSE. INTEREST NOT TO BE RAISED. (Special to “Tribune.”) Wellington. October 11. The Prime Alinister was asked by the Hon J. A. Hanan in the house is his attention had been drawn to the substantial reduction in excess of deposits over withdrawals in the Post Office Savings Bank lately, and if he had considered increasing the rate of interest to check withdrawals, which were due to the diversion of money to other channels by the higher rates of interest ? The Prime Alinister replied that it was quite true tht Savings Bank deposits were useful to the Government, as Air Hanan suggested. They had on some occasions saved the Government from the necessity of applying for a loan. The deposits were not less than ■ the withdrawals. He believed there was an excess of £47,000 last month. The reason for withdrawals was that the money had become dearer here, as in other countries. Ho had noticed advertisements offering 7| per cent, for loans to companies. Whether properly or improperly that was going on, and tho Government could not stop it. He believed it was raising the rate of interest. . The question of paying additional, interest has not been seriously considered by the Government so far. It has not been considered necessary to put up the rate for deposits which would have the effect of putting up the rate of interest throughout the country.