CENTRAL BANKING

New Zealand Herald, Volume LXXII, Issue 22090, 22 April 1935, Page 5

CENTRAL BANKING

BRITISH EMPIRE CHAIN NOW PRACTICALLY COMPLZTE THE CANADIAN INSTITUTION The chain of central banks in the British Empire,, which has been forming in the last few years, has been practically completed with the opening of the Central Bank of Canada on March 11. The institutions in Australia, South Africa and New Zealand are already functioning, and it is expected that the Reserve Bank of India will have assumed its* statutory functions by July 1. The capital of the Central Bank of Canada is £1,000,000 in 100,000 shares of £lO each, which are held by 12,000 subscribers. The dividends are limited to 4J per cent. The bank has taken over the gold reserves held by the Government and by the chartered banks. Gold held in the vaults of the Federal Treasury totalled £14,000,000. Gold handed over by the banks totalled £7,000,000, which was assumed at the nominal gold price of 20.67 dollars an ounce, although the price to-day is 35.48 dollars. The banks entered a formal protest at not receiving the current price of gold, but were over-ruled. The profit, over £4,000,000, goes to the Central Bank. With additional securities, the total assets will bo about £44,000.000. which is approximately the obligation on the note issue. The creation of a range of central banks' has opened the way to the development of a system of financial cooperation within the Empire. In reviewing the position, English authorities state that the primary responsibility of a central bank is naturally to its own country and its own Government, but they point out the scope for co-operation, which they claim will in any event be forced upon the banks in varying degrees. It is stated that fears of dictation from England are groundless. Finance and trade are inseparably connected, it is stated, and financial co-operation is an essential element of Imperial economic policy. Due weight has not previously been given to that fact, it is claimed. The London Times states: —"If Empire trade is to develop, it will be necessary to evolve some community of policy between the monetary authorities of its constituent parts. In the working out of this monetary co-operation, the central banks of the Empire are obviously destined to play a leading part." GOLDMINING INDUSTRY OVERSEAS INVESTIGATORS PARTY CONCLUDES INSPECTION The view that opportunity offered for successful goklmining enterprise in New Zealand, provided sound business lines were followed, was expressed on Saturday by Mr. G. H. Hutton, of London, one of a party of four English mining engineers which has been investigating possibilities in the Dominion on behalf of overseas interests. The party, which left by the Mariposa for Sydney, has travelled over 4000 miles in the course of its inspection of goldfields. It visited 26 plants in the South Island and nine in the North Island. Mr. Hutton expressed appreciation of the assistance given to them by the Government and the Mines Department. He said that the future action of the English companies concerned in the investigation depended on the decision of the directors, following consideration of the engineers' reports. FOREIGN EXCHANGES (Received April 21. 5.5 p.m.) LONDON. April 20 On the foreign exchange markets today the following quotations ruled: New York, 4.81£ dollars; Paris, 73| francs; Batavia, 7.18$ florins. NEW ZEALAND QUOTATIONS The Associated Banks (other than the Bank of New South Wales) quoted the following dollar-sterling rates on Thursday, subject to alteration without notice: United States Canada Conversion dollar bills received for collection and sale dollar drafts and telegraphic transfers . . . . .1.84 4.86 Purchase dollar bills . . 4.57 4.89 On a New Zealand currency basis these rates are equivalent to: — Selling: United States Cannda T.T 3.88% 3.90% On demand .. 3.89!/. 3.90% Buying: » On demand . . 3.9-1% , 3.96'/4 Following are the latest rates for purchases and sales of foreign exchange quoted by the Bank of New South Wales, Auckland. They are subject to alteration without notice: — T.T. On Demand To £1 N.Z. Currency Selling Buying Selling U.S.A., dol .. 3.88% 3.91 3.89V4 Canada, dol. .. 3.89% 3.917, 3.90% France, fr. . . 58.46 60.06 53.51 Noumea, fr. .. 57.71 61.11 57.76 Papeete, fr. .. 57.71 61.11 57.76 Belgium, belea . . 22.724 Germany, rm. . . 9.4(55 Italy, lire .. .. 46.30 Switzerland, fr. .. 11.868 12.343 11.878 Holland, fl. .. 5.661 5.961 5.665 Java, fl 5.649 5.924 5.653 Sweden, kr. .. 15.459 15.829 15.469 Norway, kr. .. 15.868 16.238 15.878 Denmark, kr. .. 17.878 18.248 17.888 Austria, sell, . . 20.224 Czecho-Slovakia, cr. 92.84 N.Z. pence to Japan, yen . . 17 13 / 18 Shanghai, dol. .. 24 M / 3a 23 V 4 24 a /„ India, rupee . . 22"/. „ 22%, 22% Ceylon, rupeo .. 22"/,« 22% ? 22% Hongkong, dol. .. 32% e 31% 32% Singapore, dol. . 35% 34' i«, So 3 /,* The cost in New Zealand currency of the pound sterling, and of the principal overseas units, on tho latest quotations, is as follows: Present Price Par sd s d Australia, pound .. 19 10.81 20 0.00 London, pound . . 24 10.50 20 0.00 New York, dollar .. 5 1.56 4 1.31 Montreal, dollar .. 5 1.41 4 1.31 Paris, franc .. .. 0 4.06 0 1.98 Berlin, reiclimark .. 2 0.80 0 11.74 Copenhagen, krone .. 1 1.33 , 1 1.22 Yokohama, yen . . .. 1 5.52 2 0.58 CUSTOMS EXCHANGE RATES Rates of exchange ruling at the announced dates of departure of vessels named are shown in the following table. They are subject to confirmation by the Customs Department when the exact time of departure is learned on arrival of the vessels in New Zealand. Finally declared rates are marked*; — Brisbane Mnru, Japan, yen .. IP/V 1 Indian, America, dollars .. .. 4.82/4 Mariposa, Canada, dollars . . . . 4.81 Mariposa, America, dollars .. 4.84 Canadian Britisher. Canada, dol. 4.84/4 Golden State. America, dollars .. 4.20 Australind, America, dollars . . 4.83/ a CALL AND DIVIDEND LIST Dividends— Alexander —Is n share . . ~. Apr. .9 United Building (Auck.)— int., 5 p.c p.a. . . • • ■ ■ Apr. 30 Dominion Pictures —int., ord., 2i ' p.c.; prof., 3 p.c. . . Apr. 30 Aus. Iron and Steel—pref., 71 p.c. p.a. for half-year ended May, 1931 May 1 12., S. and A. Bank—int., 21 p.c. May 1 Bank Adelaide—final, 2 p.c. . . May 8 Broken Hill Proprietary—Halfyear, Is a share May 15 Macky, Logan, Caldwell —3 p.c. May Mosgiel Woollen—int., 4 p.c. . . May Nat. Bank A'asia—final, 2J p.c. May Bank of New Zealand—final, 5 p.c,; D mort., 3j p.c. .. June 14