BANKING STATISTICS

Otago Witness, Issue 3592, 16 January 1923, Page 7

BANKING STATISTICS

QUARTERLY RETURNS. A MARKED IMPROVEMENT. PROSPEROUS YiiiAß ANTICIPATED. (Prom Ottb Own Correspondent.) WELLINGTON, January 10. Tlie banking returns for the closing quarter of 1922 show a satisfactory movement when compared with the December quarter of 1921. There is a substantial decrease in the volume of the advances, and although the free deposits have contracted the Goverment deposits and fixed deposits have increased, the latter showing a substantial gain. The salient features of the past quarter’s figures compared with those for the corresponding quarter of 1921 are given in the appended summary: Government deposits increased £927,383 Free deposits increased 837,563 Fixed deposits increased 1,006,365 Advances decreased 3^998,249 Discounts decreased ... 129,461 Circulation decreased 694,477 Metal reserve increased ... 200,161 Taking the three classes of deposits the aggregates compare as under:

* Decrease. The Government deposits, though substantially greater than in 1921, are very much smaller than in any of the five preceding years. In 1917 the deposits amounted to £9.905,32+, due to war loans. The free deposits have contracted to the extent of as compared with December, 1921, and they also show a shrinkage when contrasted with the figures for the September quarter of 1922. The free deposits have a tendency to contract in the closing quarter of the year and gain in volume in the March and June quarters. The free deposits held by the several banks compare as under:

* Increase. Tlie National Bank and the Commercial Bank show slight increases, but all the other institutions exhibit decreases. The fixed deposits are greater by £1.006,183, as compared with December, 1921 - and this was secured by the Bank of New Zealand and the Union Bank, the figures of the several banks showing a a under: —

3t10,000,10* XI 1,001,00.* XI,UVO,IO.J ® * Decrease. The increase probably represents the proceeds of loans recently floated by local bodies and placed at fixed deposits pending expenditure on public utilities. The free and fixed deposits, for the December quarter of each of the past seven years show as under: Deo. Free Fixed quarter. deposits. deposits. Totals. 1916 ... £18,031,742 £13,229,076 £31,260,818 1917 ... 18,496,716 13,777,801 32,274,517 1918 ... 20,536,868 14,468.976 35,003,844 1919 ... 30,136,062 15,433,913 45,569,975 1920 ... 32,929,759 16,517,134 49,456,893 1921 ... 24,380,432 16,555,187 40,935,619 1922 ... 23,542,867 17,561,552 41,104,419 Dealing now with the advances the figures disclose a shrinkage of £3.998.24-9 when contrasted with the figures for December, 1921, and as the result of the improved economic conditions traders and others have not now the same necessity for seeking bank accommodation as was the case in 1920 and 1921. and the higher prices ruling for primary products has enabled many farmers and others to repay debts due to the banks. Tile average advances of each bank for the December quarter of 1922 and _921 compare as under: Dank. Dec., 1921. Dec., 1922. Decrease. New Zealand ... £20.679,957 £18,251,824 £2,428,123 Union 5,919,070 5,509,660 49,410 *Sr.S. Wales ... 5,014,385 4,588,470 425,915 Australasia 5,797,166 5,506,484 290,682 National 7.640,438 7,148,485 491,953 Commercial ... 717,911 765,755 *47,844 £45,768,927 £41,770,678 £3,998,249 • Increase.

The discounts also show a contraction, indicating that fewer promissory notes aro being given now, and that those holding such bills have no need to discount them to the same extent as previously. The discount business done by the several banks is shown in the table appended:— Bank. Dec., 1921. Dec., 1922. Decrease. New Zealand ... £978.492 £1,029.275 »£47.783 Union 116,093 89,244 26,849 N.S. Wales 210,262 170,500 39.7G2 Australasia 171,643 140,344 31,299 National 266,452 195,396 71,056 Commercial 46,857 35,579 11,278 £1,789,799 £1,660,338 £129,461 * Increase. The Bank of New Zealand alone shows an increase, and that a very small one. The aggregates of the free and fixed deposits and the totals of the advances and discounts for each of the past nine quarters show as under:

It will be noted that the deposits reached their lower point in the March quarter of last year, but in the succeeding quarters there was an expansion, with a set-back last quarter. The advances touched the nigh point in the June quarter of 1921, but since then each quarter has shown a drop except in the past quarter, when there was a small increase. In December, 1920, the deposits exceeded the advances, but since then the advances have been in excess of the deposits. The note circulation shows a shrinkage <-! £694",477 as compared with December, 1921,. testifying to the satisfactory progress of the deflation While the circulation has contracted the coin and bullion have increased by £200,161. and the aggregates under these two heads for the December quarter of each of the past seven years show as under:

Since 1920 the note circulation Iras contracted to the extent of £1.438,431. which shows how greatly the position has improved. Commodity prices are lower and the people require less cash in their pockets to meet their daily needs. Although the number jf notes in circulation is still very large, it will be seen that the banks hold sufficient in coin and bullion to redeem every note on issue and then have £1,120*202 to snare. This huge reserve of metal earns nothing, but it has to be maintained. Viewed as a whole, the returns are exceedingly satisfactory. The country is well on the way to prosperity, which cannot ’re marred, but ca,n be delayed, by the political complications in Europe. With our wool, butter, cheese, mutton, and lamb selling at the present high prices \ve can look forward with confidence to enjoying prosperous times.

Deposits. Dec., 1921 Dec., 1922. Increase. Government ... £2,307,631 £3,325,014 £027,383 Free ... . ... 24,980,432 23,542,867 *837,565 Fixed _ . .. 16,555,187 17,561,552 1,006,365 £43,333,250 £44,429,433 £1,096,183

Banks. Dee , 1921. Dee., 1922. Decrea se. New Zealand ... £11,635,893 £11,102.315 £533,578 Union ... 2,797,055 2,764,258 32,797 N.S. Wales ... 2,684,589 2,537,885 146,704 Australasia ... 2,470,863“ 2,291,970 187,899 National ... 4.146,855 4,199,150 *52,295 Commercial 636,171 647,289 *11,118 £24,380,432 £23,542,867 £837,565

Banks. Deo., 1921. Dec., 1922. Increase. Now Zealand £8,240.301 £9,251,747 2,126,199 £1.011,446 Union 1,860,330 265,879 N.S. Wales .. . 2,418,798 2,378,115 *40,621 Australasia 1,177,858 . 2,958,015 1,161,509 * 16,349 National 2,410,175 *547,84(1 Commercial 259,955 233,807 *26,148 £16.555.187 £17,561,552 £1.006,18.1

Quarter Deposits. Advances. December, 1020 ... £40,456,803 £47.118,295 March, 1021 47,155,730 52,446,341 June, 1021 45,511,095 54,385,485 September, 1021 ... 43,445,663 48,039,609 December, 1921 ... 40,935,621 47,558,726 March, 1022 40,360,389 46,401,314 June, 1022 41,388,886 46,155,934 September, 1022 ... 41,061,866 42,994,448 December, 1922 ... 41,104,419 43,431,016

Dec. q,r. Circulation. Coin and Bullion. 1916 ... £4,778,267 £7,688,098 1917 6,464,695 9,993,391 1918 6,761,705 9,434,670 19197,254,412 7,862,415 1920 8,252,839 7,657,093 1921 7,458,385 7,683,949 1922 6,763,908 7,884.110