BANK STATEMENT.

New Zealand Herald, Volume LXVIII, Issue 20768, 10 January 1931, Page 10

BANK STATEMENT.

ADVANCES .INCREASED

BIG MOVES IN DEPOSITS.

FREE SHOW HEAVY FALL. FIXED INCREASE OVER £2,000,000 [»V TEUSCSII.U'II. —I'UESS ASSOCIATION'.J WELLINGTON. Friday. The salient features of the banking averages for tlio past quarter may ho summarised as under:—Government deposits increased £201,005, free deposits decreased £4,130,655, fixed deposits increased £2,147,318, advances increased £602,087, discounts decreased £27,270, circulation decreased £411,134. coin and bullion decreased £262,400.

The ahovo comparison is with the December quarter of 1929, and what is most noticeable is that there is a very substantial shrinkage in tho current account balances and a fairly heavy contraction in the note circulation, these two items representing spending power. On the other hand, the fixed deposits have increased by a substantial amount. Tho three classes of deposits compare as under:— Dee.. 1929. Dec.. 1930. Increase. Govt. . . £1,658,402 £'1,859,'107 .{■201,005 Free . . 22.728,494 18,597,8:19 4,130,655* Fixed . 30,028,239 32,775,557 2,117.318 £55.015,135 £53,232.803 .fl ,782.332* 'Decrease. There is a decrease in the total of the deposits of £1,782,332 notwithstanding that Government and fixed deposits have increased. Distribution of Deposits. All the banks wore concerned in tho shrinkage of free deposits as will bo seen by the table appended Fit Eli DEPOSITS. Bank. Dec. 1929. Dec! 1930. Decrease N. Zealand fclo.s9S.Got 8.5G3.038 2,035,503 Union . . 2,508,291 2,130,590 437,701 M.S. Wales 2,144,510 2,011.582 429.958 Australasia . 2,171,147 1,850,8-15 320,302 National . 3.928,231 3.130,118 798,113 Commercial 1,017,084 903,000 109,018 Totals .. 22,728,494 18.597,839 4.130.055 The loss in free deposits shown by the Bank of New Zealand looks large, but when it is remembered that this bank does more than half the banking business of the country tho shrinkage is relatively not very great. Tho increase in the fixed deposits is not shared in by all the banks, the Commercial Bank of Australia showing a small decrease, tho figures of the several banks show as under: — FIXED DEPOSITS. Bank. Dec. 1929. Dec. 1930. Increase. N. Zealand £15.237,601 10,093.459 855,858 Union .. 3,231,747 8,754,495 522.718 N.S. Wales 4,091,801 4,171,300 79,439 Australasia 2,740,480 2,957,045 210.505 National 4,038,789 5.127,591 488.802 Commercial 087,701 071,007 10,091* Totals .. 30,028,239 32,775,557 2,147,318 'Decrease. The total of the free and fixed deposits is less than in the corresponding quarters of 1929 and 1928, but substantially greater than in tho preceding years. Tho movements in the deposits over a series of years are disclosed in the table appended. Dec. Quarter. Free. Fixed. Total. 1925 . £25.189.553 X 20.540.809 £40.030,302 1920 . 23,131,103 21,105,547 41,230.050 1927 . 21,438,335 24,2(52,722 45,701,057 1928 . 22.179,748 29,481,058 51,001,400 1929 . 22,728,494 30.028,239 53,350,733 1930 . 18,597,839 32,775,557 51,373,390 Two Banks Add to Advances. The advances show the small increase of £602,087, due to the free lending of the Bank of New Zealand, which shows an increase of £1,587,328 in overdrafts. The Bank of New South Wales is the only other bank to show an increase. The figures of tho several banks arc given in the table below:— Bank. Dec-., 1929. Dee., 1930. Decrease. N, Zealand £23,058.200 £2-1,045.594 £1,587,328* Union 0,400,337 0,304,553 95,784 N.S. Wales 0,441,572 0,547,229 105.057* Australasia 5.281.795 5,002,787 279,008 National . 9.703,840 9,119,797 584.043 Commercial 1.720.077 1.591.714 131.903 Totals JC52.012.557 .£53,214,G71 £002,087* "I ncrease. The discounts for the past quarter totalled £1.168.074. as compared with £1.195.344 in the December quarter of 1929, showing a shrinkage of £27.270. The total accommodation granted clients by the banks exceeds the aggregate of the free and fixed deposits and they have had to draw upon their other resources to meet the demands of borrowers. Tho movements in tho deposits and advances and tho excess of one over tho other are shown by tho figures appended : December Quarter, Deposits. Ad\nnres. Excess. 1925 .. £40,030,302 £43,551,427 £2.524,065 192R .. 41,230,050 51,273,211 7,035.501 1927 .. 45,701,057 59,759,00-1 4,058.607 1928 .. 51.001.406 48,101,104 * 3.500,302 1929 .. 53,356,733 53,807,931 451,198 1930 .. 51,373,390 54,382,748 3,009,352 'Excess of deposits. The banking position appears to be considerably better than in 1926 and 1927, in which years the, banks lent rather freely and no doubt they profited by the experience for they appear to have the position now well in hand. The note circulation totalled £6.133,388. compared with £6,544.522 in the corresponding quarter of 1929. 'lhe com anl bullion amounted to £6,352,564. against £6,614,964. Tlio returns as a whole show that the banks aro handling tlio situation with very grant euro, for those urc abnormal times when banking institutions must exercise oxtremo caution.