BANKING RETURNS

Otago Witness, Issue 3384, 22 January 1919, Page 43

BANKING RETURNS

TREND TOWARDS NORMALITY,

(Fbom Ouh Own CoBHEapoNDBNT.) WELLINGTON, January 14. The outstanding features in the banking returns for the last quarter of last year are a shrinkage in the Government deposits, increases in both fixed and free deposits, a moderate expansion in the ad vances, and a further slight increase m the note circulation. The figures seem to reflect the slight improvement that has taken place in shipping, and indicate a trend towards normality. The movements in the three classes of deposits are ' disclosed in the table appended:—

♦Decrease. The shrinkage, in the v Governnient deposits is rather pronounced, and it is the first time since 1911 that we have had to record such a movement; as will be seen from the table following:— December, 1915 ... ... ...£3,030,645 December, 1816 ... ... ... 6,358,863 December, 1917 ... ... ... 9,905,324 December, 1918 7,151,353 . _. ■ A further decrease in the Government deposits may take place during the current quarter, unless, of course, the next war loan js issued in time to secure the application and allotment moneys before the end of March; but, apart from this, a change in the amount of the Government deposits must be expected. Now that the war has ended, and the time .for squaring accounts has arrived, the free , deposits of current account balances show the substantial gain of £2,040,172, while at the' close of 1917 the increase under this head was only £464-,974. This is undoubtedly an excellent showing and the increase has been shared by all the banks, except the Bank of New South Wales, as the table appended discloses:—

♦Decrease. , . Ab the corresponding date in 1917 the Bank of New Zealand figures exhibited a shrinkage, while now there is the huge increase of £1,030,707. The fixed' deposits also show a larger expansion than in 1917, the figures being £689,175, as compared with £518,725. The figures of the several banks compare as under:— -' ,

Tllhe Bank of New South Wales exhibits the largest relative gain, the increase being over 10 per cent. The following table, which shows the growth of the two classes of deposits for a number of years, discloses the effects of the way and "other finances of the people:— ...

In the years 1916 and 1917 the position was affected '>y the shortage of snipping, but In 1918 there is a substantial gain, ana we may expect further improvement now that we are beginning to be provided with a fair amount of shipping. Another pleasing feature of the returns is the comparatively small increase in the advances. Thi* inoreaso totals £2,076,162, while the increase in 1917 amounted to £4,361-,573, or more than double. The advances made_ by the several banks during the two periods disclose the following movements:

♦Decrease. The Bank of Australasia and the National Bank show 10 per cert, increases, and the Oomra'-.rcial Bank an increase of about 65 per cent. The Union Bank has reduced its advances by .£l4-7,637. The discounts are less by £3417, the aggregates being £1,333,917, as compared with £1,337,334 for December, 1917. The advances and discounts for a period of years show the following movoments;

The volume of the advances at the end of 1918 was nearly £10,000,000- more than at the close of 1913, Taking the fixed and freo deposits together and the advances and discounts together, the excess of the one over the other for tho December quarter of several years is given below:

Turning now to tho circulation, there is to b© noted an increase of £297,010, which is the smallest expansion that has taken place during the past five years. Coin, bullion, and legal tender notes amount to £9,434.670, and are less by £558,721 when compared with the total in 1917. The position is disclosed in the following t?.ble:

It is necessary to bear in mind that, although the circulation represents the aggreSate amount of paper issued by the banks, i is not all in circulation, because the

banks held £1,311,442 "legal tender notes of other banks." The true circulation —that is, the notes in the hands of the public for the past quarter—was £5,450,263, and not £6,761,705. The banks held the balance of the_ notes. Taken all round, the figures are satisfactory in that they show that the economio conditions are stable. As stored stocks of produce are turned into cash there should bo an imorovement in the banking figures. The deposits should increase and the advances decrease.

G-overment deposits Free deposits .. Fixed deposits December 1917. . £ 9,905,524 . 18,496,716 13,777,801 , December, 1918. £ 7,151,353 20,536,S68 14,466,976 Increase. ♦£2,753,971 2,010 152 689,175 Totals . £42,179,831 *42,165,197 £24,644

Bank Dec, 1917. Dec, 1918. Increase. Hew Zealand ... £8,740,159 £9,770,866 £1,030,707 Union ... ... ... 2,417,490 2,603,904 186,414 N.S. Wal€3 ... ... 2,458,286 2,418,686 *28,600 Australasia ... ... 1,974,563 2,249,106 274,542 Ka.tionul ... 2,665,549 3,159;565 . 494,016 Commercial ... Totals ... 240,669 333,741 93,072 ... £18,496,716 £20,536,868 £2,040,172

Bank Deo., 1017. Bee, 1918. Increase. New Zealand ... £6,928,818 £7,208,199 £279,281 Union ... 1,607,405 . 1,682,310 74,905 N.S. Wales ... ... 2,044,731 2,2G3,918 219,187 Australasia ...' ... 1,060,633 1,090,716 30,083 National ... ... ... ' 2,062,215 2,106,105 43,880 toommeroial ... Totals .1. 73,889 115,728 41,839 ... £13,777,801 £14,466,976 £689,175

December Free Fixed Quarter. Deposits. Deposits.. Totals. i:>13 ... ....-eu,2c:i.S75 £10,545,348 £22,839,220 1914 ... ... 13,675,479 10,727,620 24,403,099 1915 ... ... 17,293,719 11,861,582 29,155,301 1916 ... ... 18.031,742 13,229,076 81,260,818 1917 ... ... 18,496,716 13,777,801 ■ 32,284,517 1913 ... ... 20,536,868 14,466,976 35,003,844

Bnuk Deo., 1917. Dec, 1018. Increase. New Zealand ... £14,036,613 £15,186,441 £1,149,828 Union ... 4,315,212 4,167,575 ♦147,638 N.8. Wales ... ... 3,577,704 8,748,007 170,303 Australasia ... ... 3,431,917 3,771,816 339,899 National .„ . 4,070,170, 4,477,439 407,169 Commercial ... Totals ... 231,365 387,865 156,500 ... £22,662,981 £31,739,143 £2,076,162

Deo. quarter. Adrarjoec. Discounts. Totals. 1913 ... £21,826,746 £2,014,589 £23,841,335 1914 ... 23,121,235 1,811,573 24,932,808 1915 ... 22,589,136 1,453,703 24,042,839 1913 ... 25,298,403 1,668,222 26,966,630 1917 ... 29,662,981 1,337,334 31,000,315 1918 ... 31,739,143 1,333,917 33,073,060

Deo. Excess of Quarter. Deposits. Advances. Deposits. 1913 ... £22,839,220 £23,841,335 £1,002,115 1914 ... 23,403,099 24,932,808 529.709 1915 ... 29,155,301 24,042,839 5,112,462 1916 ... 31,260,818 26,966,630 4,294,188 1917 ... 32,274.517 31,000,315 1,274,202 1918 ... 35,003,844 33.073,060 1,930,784

Dc. quarter. Circulation. Ccin, bullion, etc 1013 . ...£1,671,733 £5,2S0,183 1914 . ... 3,614,232 6,209,113 1915 . ... 3,097,816 6,9sO,616 1916 . ... 4,778,267 7,:SS,0D8 1917 , ... 6,464,695 9,993,391 1918 : . ... 6,761,705 9,434,670