BANKS AND INDUSTRY

Nelson Evening Mail, Volume LXIV, 2 April 1930, Page 6

BANKS AND INDUSTRY

THE RIGHT TIM JO TO HELP "It lies with industry to reorganise itself, that not being within the province of the banks, and provision of capital is of little value unless a business is efficiently organised and controlled," said Mr F. I'. Goodenough, chairman of Barclay's Bank, in his address at the annual meeting. "If the banks should advance further money at a time when the control of the business itself is inefficient, or if the industry as a whole is labouring under more or less permanent difficulties, either natural or artificial, which cannot be overcome, tho money advanced by banks under thoso circumstances would become a loss, and no benefit would accrue either to tho industry or to the banks. In many instances, where a business fails to make progress, it may be found that the primary reason for this position is not a shortage of capital, but the handicap of inefficiency, as compared with other similar businesses. either at home or abroad. In the alternative, it may be due to the ignoring of economic laws or to some alteration of basic conditions. If tho difficulty is due to some relative inefficiency, it may be possible to overcome it through reorganisation. It is then that the banks can assist by helping to find the liquid capital that is necessary to such reorganisation when a scheme has been carefully worked out by experts. When, however, there has been a change in basic conditions, or some artificial interference with economic laws, which precludes the possibility of successful operation, if the banks try to help they are then merely throwing good money after bad."