OTAGO BUILDING SOCIETY

Otago Daily Times, Issue 26544, 20 August 1947, Page 7

OTAGO BUILDING SOCIETY

RESTRICTION OF INTEREST ON DEPOSITS

Tam annual report of the Otago Biyld--ine and Investment Society and Dank of Deposit states that the .major problem confronting the society at Iho .me is the effect the Deposits Interest Restriction Order, 1945, Amendment No. 1, is having upon the society’s Progress. Under this legislation, it is not permitted to psy in excess of 23 per cent, for three-year deposits. On the other hand national savings are returning 3 per cent, for two vears while other financial institutions arc still at liberty to pay 2J per. cent, at call A permanent co-operative society must depend largely upon deposit moneys, and, whilst the Otago Society has shown an increase under this heading for the year u*der review, it has been insufficient to meet loan applications received. The report says that the profits and interest rebate has again been declared at 5 per cent.. £2923 13s 2d being credited to investors and £4827 5s lOd to-borrowers. In view of the times, the expansion in loans has been satisfactory. They now stand at £406,338, as against £363.921 in 1946 an increase of £42,417. Shares also show' an expansion, and now 'number 23,4821, held by. 1420 members, as compared with 20,864, held by 1298 members, at our last annual balance. Debentures record a figure of £207,052. as against £189,485 last year, an increase of £17,567. Matured debentures during the year amounted to £74,920. of which figure £58.000 was renewed, the balance being paid out. To the Mortgage Reserve Account has been added the sum of £704 10s Id from Profit and Loss Account, and £345 9s lid from Profits Surrendered Account, bringing the reserve up to £12,150.