STEP TAKEN BY BANKS

Southland Times, Issue 23840, 10 June 1939, Page 8

STEP TAKEN BY BANKS

SUSPENDING OVERSEAS CREDITS SITUATION NOT LIKELY TO LAST LONG (United Press Association) AUCKLAND, June 9. Overseas credits for goods the subject of licences for the second period of the year will not be granted in the meantime, according to advices received from trading banks by Auckland importers. The situation was not altogether unforeseen by importers, but it is considered that it will not last for any considerable period. It is pointed out that it is apparently intended by the banks to take stock of the position arising from commitments under the first' period of import licensing, which will not be completed until the end of the month. . “One can hardly conceive of the situation lasting any length of time,” said an importer who gave as an instance the situation in December last, when the issue of licences was held up, apparently while stock was taken of the financial situation. The funds overseas are heavier than at the beginning of the first period, the Reserve Bank’s sterling funds increasing by £1,318,000 during the past week, and it is thought by importers that, in view of the failure of the Australian loan in London, the banks’ desire was to build up the sterling reserve so that the plans of the Minister of Finance (the Hon. W. Nash) for the approaching conversion of £17,000,000 would be assisted. REPORTS DENIED IN LONDON FUNDS FOR PURCHASE OF GOODS LONDON, June 8. New Zealand banking circles in London deny the reports from New Zealand that they are not supplying funds for the purchase of overseas goods and repudiate the implied suggestion that they are bringing improper pressure. Government funds may have been withheld in special cases, pending investigation, but there has been no .general hold-up, it is stated.