BANK NATIONALISATION

Poverty Bay Herald, Volume LXI, Issue 18503, 15 September 1934, Page 15

BANK NATIONALISATION

WHAT WOULD FOLLOW ?

BANK CHAIRMAN’S VIEWS

MELROURNE. Sept. 5. Further references to the proposal of the Labor Tally for the nationalisation of banking were made yesterday by Mr. E. O’Sullivan, chairman of the Associated Banks of Victoria. . .Mr. O’Sullivan said the nationalised bank proposed by the Labor Tarty would, it has been intimated, compete for business with the trading banks, and thus, by beating them out of existence, bring: about a one big nationalised banking monopoly. The competition which the Labor Party said was to be inflicted on the trading banks by the Commonwealth Rank* reformed according to Labor ideas, would be either fair or unfair. If it was fair, the trading tanks had nothing to fear, for there had never yet been a, fair contest between Government and private enterprise that did not result in victory ior private enterprise. The competition vyould be unfair so much so that private banks would be doomed from the. first to extinction. That much Labor bad made clear. It was well that the electors should understand just where such action must lead. Eabor scorned to assume that the trading hanks would continue the* hopeless fight until their assets had been dissipated or acquired by the national bank. Clearly they would not, but would sell out as soon as it became obvious that the contest was hopeless and while they could still show a surplus over 20 shillings in the pound. They would close voluntarily. ' what must happen

“I am not stating now any definite policy of the banks, because, in this connection they have none., Mr. O Sullivan went on. “I am merely pointing out what oommonsensc tells me must Imppen. The banks would call in llfeir advances, pay their creditors and depositors, sell thejr buildings and sites, disniiss their staffs and distribute the balance on realisation of their assets to shareholders. Buildings and sites worth at, present, about £15,000,000, would be thrown on the market for compulsory realisation. This would bring about, a serious slump in property values throughout the Commonwealth. Unemployment would lie caused, first, by the dismissal of bank staffs, ami then by the. evacuation of buildings which at present employ large numbers of workmen on repair ami maintenance. The trading banks would also withdraw from tho Commonwealth Bank their current deposits, totalling nearly £30,000,000, which are now a now a. verv important part, of the Commonwealth Bank’s working capital, on which no interest is paid. That money would have to be found elsewhere, or the Commonwealth Bank would be inconvenienced, and the only alternative to getting if by taxation from flic people would be to adopt, the disastrous Labor method of printing it. which Mr. Frank Brennan ancj other Labor candidates make quite plain is the principal part of Labor's crazy policy of financial reform. Tn addition, the people —or tho, printing press, would have to provide about £2,000,000 a year which the trading banks no pay in taxation.”