RESERVE BANK

Nelson Evening Mail, Volume LXXII, 14 April 1939, Page 3

RESERVE BANK

RESERVE RATIO, 25.501 PER CENT.

DECREASE IN STERLING EXCHANGE NOTE ISSUE AT HIGH LEVEL WELLINGTON. This Day. Sterling exchange funds of the Reserve Bank of New Zealand on Monday totalled £4.598.652, a decrease of £64.658. The bank's net overseas assets at £4,554,564, were down by £82,525. The proportion of reserve to notes and other demand liabilities on Monday was 25.501 per cent, compared with 78.519 per cent, a year ago. Advances on dairy produce at £7,497,177, show an increase of £325.977. Advances to the State for “other purposes” total £11,975.000, a decrease of £IOO,OOO. Total advances by the bank to the State are £19.472,177, a net increase of £225,977. The note issue has reached the high level of £15.457.625. which is £1.519.990 in excess of that of a year ago. The statement of assets and liabilities of the Reserve Bank as at the close of business on Monday, 10th April, is as

£(N.Z.)30,947,193 2 0 ‘Expressed in New Zealand currency. Proportion of reserve (No. 7 less No. 5) to notes and other demand liabilities* 25.501 per cent., compared with 25,924 per cent, on 3rd April, and 78,519 per cent, on 11th April. 1938. The reserve on Monday amounted to £7,356.354, compared with £7,428,880 on 3rd April, a decrease of £82,526. On 11th April, 1938, the bank's reserve stood at £19,871,865.

Sterling exchange, expressed in New Zealand currency, totalled on Monday £4,598,652, compared with £4.663,309 on 3rd April, a decrease of £64,658. There are liabilities in currencies other than New Zealand currency amounting to £44,088 (an increase of £17.868), thus reducing the bank’s net overseas funds to £4.554,564, a decrease on the week of £82,525. A year ago the bank's overseas assets totalled £17,070,074. Gold remains unchanged at £2,801,791. Subsidiary coin totals £224,548, a decrease of £1947. Advances to the Primary Products Marketing Department total £7.497,177, an increase of £325.977. Advances to the State for other purposes amount to £11,975,000, a reduction of £IOO.OOO. Investments total £3.699.138. an increase of £9233. Other assets total £150,887, an increase of £3163. The note issue, swelled by holiday requirements, totals £15,457,625. an increase of £178,155. The latest figure is £1,519,990 in excess of the total note issue of £13,937,635 a year ago. Demand liabilities to the State amount to £3,630.084, an increase of £63,400. The trading banks’ reserve balances, totalling £9,339,352, show an increase of £415,197. Other demand liabilities at £420.532, show a decrease of £504.455. Other liabilities amount to £555,511, an increase of £1603. The statement balances at £30,947,193. an increase of £171.767. MOVEMENTS IN STERLING EXCHANGE The movements in the sterling exchange held by the Reserve Bank of New Zealand during the last few months and the decrease in the ratio percentage of reserve to notes and other demand liabilities, are shown in the following table:— Sterling Reserve exchange. ratio

follows:— 1. LIABILITIES £ Gen. Reserve Fund 1.500.000 0 d. 0 2. Bank notes 15.457.625 10 0 3. Demand liabilities— (a) State 3.630.083 13 8 <b> Banks 9,339,352 0 9 (c) Other 420.532 1 11 4. 5. Time deposits Liabilities in currencies other than N.Z. currency 44.088 4 5 6. Other liabilities ... 555,511 11 3 £t N.Z. >30,947,193 2 0 ? ASSETS Reserve — £ d. (a) Gold 2,801.791 0 0 *<b) Sterling exchange 4.598.651 14 4 8. fc) Gold Exchange Eubsidiary coin ... 224.547 13 4 9. 10. Discounts— (a) Commercial & Aricultural Bills (b) Treasury and Local Body Bills Advances— (a) To the State or State untakings— < 1) Primary Products Marketing Dept. 7.497.177 3 0 (2) For other purposes . 11,975.000 0 0 11. (b) To other Pub lie Authorities Investments 3.699.138 2 5 12. 13. Bank buildings Other assets 150.887 8 11

£ (N.Z.) per cent. 1937. Dec. 27 16.992,748 70.323 1038. 13.095,000 67.2 12.639,000 65.847 Sept. 12 »M«. 12,681,343 66.428 Sept. 19 12,247,006 63.853 11,449,447 60.785 Oct 3 10,594,978 57.259 Oct 10 9.900.233 57.903 Oct 17 9,118,330 52.27 Oct 24 8.313.575 48.451 Oct 31 7,707.697 46.09 Nov. 7 6.633.031 39.733 Nov. 14 5,662.977 36.825 Nov. 21 5,029,137 33.723 Nov. 28 4.828.302 32.685 Dec. 5 4,200,856 29.834 Dec. 12 - T — 4,572.031 30.333 Dec. 19 4,368,095 28.109 Dec. 20 4,678,233 27.882 Jan. 2 4,017,232 26.13 Jan. 9 3,933,851 25.526 Jan. 10 ... 4.373,105 26.782 Jan. 23 4,395,525 26.695 Jan. 30 4,133.586 25.75 fr eb. 0 ... 4.074,954 25.047 Feb 13 4,164.499 25.073 Feb. 20 4.523.031 25.378 Feb. 27 4.839,555 25.799 Mar. 6 4,705,897 25.017 Mar. 13 4.591,686 25.026 Mar. 20 4.547.863 25.129 Mar. 27 4.659.874 25.419 Apr. 3 4.663.309 25.024 Apr. 10 4.593,652 25.501 The statutory minimum ol the reserve ratio is 25 per cent.