N.Z. BANKS’ GOLD

Poverty Bay Herald, Volume LXI, Issue 18397, 15 May 1934, Page 9

N.Z. BANKS’ GOLD

PRICE TO BE PAID AN OLIVE BRANCH Differences of opinion between the New Zealand Government and tire trading banks in Mew Zealand as to the price at which the gold held by the banks should be acquired by the Government, were referred to at the annual meeting of the Bank of Australasia in London. The gold is to be taken over compulsorily by the Central Reserve Bank, which is to be established. Mr. A- Whitworth, who presided at the meeting of the Bank of Australasia, said that when the proposed bill was under discussion an understanding was come to with the banks that the price to‘be paid would he submitted to arbitration, and the bill in 1932 was actually drafted with a clause giving effect to this, but vvhen the bill was brought before the House of Representatives ■* in October, 1933, the stipulation was omitted, and the banks were informed that if the Government had insisted on its insertion the Government would have been defeated on the bill.

Mr. Whitworth said that if the public interests of New Zealand demanded establishment of a Reserve Bank, the trading banks were well advised to facilitate its establishment. In liis opinion the banks would have a gehttine grievance if the gold compulsorily ao mired from them was in excess, Ss in* deed it might be, of the backing required for the currency needs of the country, leaving a surplus for sale at a profit. It was-not quite certain whether the matter, in spite of the passing of the Act had been finally disposed of, but in any case the controversy was between the trading banks and the New Zealand 'Government, and Mr. Whitworth wished to emphasise that nothing that had been said or done in this dispute would affect .the relations between the Bank of Australasia and the new Reserve Bank when it started operations. He did not think that tile attitude of the Government of New Zealand towards this controversial question could be explained as indicating any general desire to attack private property. Even at this late hour he be'ieved that tile trading banks would bo yiti'fied if some recognition, however moderate, was made in satisfaction to them that the claims they had put forward were n'ot altbge'ther ' selfisli nnd without substance.