PAYMENT SUSPENDED.

New Zealand Herald, Volume LXVIII, Issue 20924, 14 July 1931, Page 9

PAYMENT SUSPENDED.

BIG BERLIN BANK.

devastating effect.

GENERAL run feared.

GOVERNMENT'S ACTION.

GUARANTEES DEPOSITS.

gy Tc'ieP"nph—Press' Aspocint-on— Copyright. (Received July 13, 7.35 p.m.) * BERLIN. July 13. j> a y m enfc has been suspended by the p armS tacdter und Nationalbank, one of ;h» l 'gs cs '' financial institutions in

GermanyThe Government has informed the director!! of the bank that it will guarantee all the deposits and .superintend the orl ierly liq'« lation o{ t,le concorn--Ihe> effect of the suspension of payment by Darmstaedter institution is likely to be devastating. The Government fears that a general run on all the 'banks will result in the greatest bank craiih Germany has known for years. The Darmstaedter und Nationalbank was hearily involved in the collapse of a ' German wool concern, but nobody dreamed that this old-fashioned business, which last year paid 8 per cent, and employed 7000 people, would close its doors. fir, Jakob Goldschmidt, the general managfir of the bank, is regarded as one of Germany's financial geniuses.

- The Darmstaedfer und Nationalbank is „ joint stock concern with headquarters in Berlin. Its paid up capital is 60,000,000 reichmarks (about, £3.000,000). It was established in Darmstadt in 1853 under the name of Bank fur Handel und Industrie. Upon its amalgamation with the National Bank fur Deutschland in 1921, the name was changed to the Darmstaedter und Nationalbank. The head office of the bank is in Berlin and it has branches in every important German town. [Hie bank has important affiliations with other banks in Germany, Austria, Holland and Poland, these associations having been established to ensure the collaboration of foreign capital in the reconstruction of German industry and especially in the financing of export trade. The bank paid dividends of 10 per cent, in 1924 and 1925, of 12 per cent, for the next four years and of 8 per cent, for 1930. Its net profits last year were £40J.3C0 against £589,850 in 1929. The responsible partners in the bank are Dr. K. Beheim-Schwarzbach, Hen* S. Bodenheimer, Dr. Jakob Goldschmidt, Dr. A. Bosin and Dr. A. Strube. The president of tho board of directors is Dr. Riesser and tho vice-president Herr H. Boemers.

SPECTRE 0E RUIN.

BOURSE COLLAPSE FEARED. ANOTHER DESPAIRING APPEAL.(Received July 23, 9.35 p.m.) , BERLIN. July 13. ■With a view to averting a collapse on toe -Bourse the directors are closing the Stock Exchanges at Berlin and elsewhere to-day. Trading in stocks has been forbidden for two days.

Public opinion is unanimous that the country cannot accept the political ultimatum because it' would be driven into a financial, corner. Instead a scheme for the declaring of a moratorium on all prhats debts in Germany is being discussed by the Cabinet. However, this is likely to be shelved as virtually it would he a declaration of national bankruptcy.

.Already very severe restrictions are being enforced on the discounting of bills. The Reichsbank is submitting each bill to-individual scrutiny as the gold and currency cover on Saturday had sunk to 40 per cent., which is the bare limit permitted bv the Bank Notes Act.

Herr Hitler's . supporters, who are lecuring many recruits, are ready to jump at the opportunity presented by the threatened chaos to seize power.

In receiving the Ambassadors of the United States, Britain, France and Italy, the Foreign Minister, Dr. Curtius, addressed another despairing appeal to the Powers to save Germany from ruin.

ECONOMIC DISTRESS.

HELP FROM AMERICA.

WILLINGNESS OF ' BANKERS.

(Received July 13, 5.5 p.m.) WASHINGTON, July 12,

An assurance that United States bankMs are prepared to assist in relieving the German economic situation was given today by the Acting-Secretary of State, Mr. W. It. Castle. He said the leadership in the matter would be left to the European central banks.