BANKING RECORDS

New Zealand Herald, Volume LXXV, Issue 22950, 31 January 1938, Page 7

BANKING RECORDS

AUSTRALIAN FIGURES LARGE EXPORT RECEIPTS MORE INDUSTRIAL ACTIVITY For the last three months of 1937 the deposits of 10 Australian trading hanks rose to £3l-1. OSS,OOO and advances to £271.320,000. Hotli figures were records. The. previous peak lor deposits was £313,1.V2.000 and that for advances was £271,110,000, both reached in the December quarter ot 1929. Compared with the figures for the December quarter of 1936,- total tieposits were higher by about £23,760,000, fixed deposits having increased by £12,900,000 and current accounts by £10,800,000. This movement was largely a repetition of the year-to-year movements recorded during the September and June quarters last year. Most of the growth of deposits has been due to the large income of the export industries; some to the inflow of British and New Zealand luiuls lor investment in Australia.

At. the same time there were further additions to the net liquid resources of the banks in Australia. Compared with the December quarter, coin rose by £70,71;}, and bullion by £219,57(3, and Australian notes and cash with the Commonwealth Hank were higher by !_'6,946,802. Auuinst those additions there was a fall of £'2,MM,-161 in Treasury bills, but long-term Government securities increased by £5,023,381. The banking position, in short, remained "easy," with all the indications of a maintenance of cheap money rates. Advances to industry were higher by £6,61)1,050 than in the December quarter of 1930. Some of the increase may be attributed to the general buoyancy of trade, and some to the demands of the rural industries. It is probable that .the .share of secondary industry and commerce in the Iresli advances was quite large, since the tendency has been for expanding trade to encourage extensions ot manufacturing plant and additions to other capital equipment. Another factor promoting increased lending by the banks was the co-opera-tive building schema launched last year in New South Wales. The banks have already found about £ 1,1500.000 lor loans to the building societies under this scheme.

PROFIT OF £500,000 ENGLAND'S "BIG FIVE" ANALYSIS OF ACCOUNTS With a joint increase in profits by not quite £500.000, the "big live" banks have m:ul<\ or, rather, have shown, nntch the san:e aggregate additional earnings as last year, it a reasonable allowance is made lor the Westminster Hank's undisclosed staff bonus item, states the .Manchester Guardian. Separately considered, the banks have shown a difference in prolit increases for which only the respective boards' sense of discretion can be accountable. "Nobody," it states, "will suppose that Barclays Bank has added six times as much to actual profits as the Midland Bank or the National Provincial five times as much as the Westminster. The Westminster last year showed, even allowing for the bonus factor, a disproportionately large profit increase, but then it had shown none at all in 1935, and for 1937 once again shows very little. The National Provincial and Lloyds have spaced out their profit increases prudently. The Midland made targe returns in 1935 and 1936, but shows a small increase only for 1937. Even so, Barclays has. over three years, shown much the biggest addition, and is the only bank to have maintained its dividend unchanged since 1930, though the Westminster this year has restored, by way of bonus, the full distribution. "Collectively the banks have not added nearly so much to deposits in the last year as in the previous year, [•'or the clearing banks as a whole from November, 1935, to November, 193(5. the increase was £170,000.000; from November. 193G, to November, 1937, only £24,000,000. However, they have expanded the most remunerative earning asset, advances, by considerably more than the net addition to deposits. Nor. is this the only change that has made for greater earnings "The banks arc believed in 1037 to have profited considerably by reducing the interest allowed on deposits in almost all cases to ] per cent, even where previously they were allowing larger amounts in competition in country centres. For some reason, however, Mime of them arc still paying out larger percentages in foreign deposits. The Westminster Bank, first to declare its dividend, remains the only one that has added to its distribution again last vcar."

PREMIUM FOR BACON OFFER TO GROWERS DECISION OF SHIPPERS To assist tlio Department of .Agriculture in its efforts to encourage farmers to die lies't liaeon possible lor export and to give tlie department their fullest support to its grading scheme for bacon carcases, the principal exporters of bacon pigs have agreed to offer producers a premium price of fd per lb. This premium price, it was explained by one of the exporters yesterday, will bo paid for all bacon pigs grading No. 1 grade under the department's grading specification. As a result of this decision the buying schedule for prime bacon pigs, dressed weight 1211b. to 1601b., will be adjusted immediately as follows: —No. 1 grade, 6jjd per II).; No. 2 grade, Gd per lb.; No. .'5 grade, sjjd per ll>. Overweight baconers of from 3611b. to 1801b. will be paid for at the rate of Id per lb. less for each grade, and uncxportable and condemned carcases will bo paid for according to value. The standard for second-grade pigs has not been altered, and these will ho paid for at ojfd per lb. It was stated that the department's grading specifications are based on the thickness of backfat. It is expected that particulars will be gazetted tomorrow, from which date all bacon carcases for export will bo measured at the works for thickness of backlat under the supervision of officers of the department. The grading specifications lay down the maximum thickness of backfat lor each grade with variations adjusted to the weight of the carcase. The maximum thickness of backfat for the average weight carcase of, for instance, 1401b. dressed weight is provided for in each grade as follows:—No. 1 grade, shoulder, ljin., loin, ljin.; No. 2 grade, shoulder, 2Jin., loin, 1 gin.; No. 3 grade, shoulder, 2gin., loin, 1-Jin. During recent weeks, at the request of the department, grading of a preparatory nature has been carried out at most of the export works. It is anticipated from the experience so obtained that about 50 per cent of bacon carcases will grade No. 1, about 30 per cent No. 2, and the balance, of 20 per cent, will be mostly No. 3 grade with a percentage of seconds.