BANKING MONOPOLY

Wanganui Chronicle, Volume LXXXIII, Issue 19841, 16 May 1927, Page 9

BANKING MONOPOLY

MR. HOLLAND’S CRITICISM RAISING OF INTEREST RATE. [ Special to " Chronicle.] TIMARU, May 14. Mr H. E. Holland, Leader of the Labour Party, addressed a well attended meeting here to-night, when he spoke on tho lilies of his North Island addresses. With reference to the decision of the Associated Banks to raise the rate of interest to 7 per cent., he predicted that this would precipitate a crisis in the Dominion. Tho increase was possible through the existence in the Dominion of a private banking monopoly, which completely dominated the position. It was unsatisfactory that the Bank of New Zealand, in which the Government had intervened, was found functioning as an effective part of this monopoly, which was loading the guns against local bodies and private borrowers.

It should be explained, said Mr Holland, why interest charges were raised and credit made dearer at a time when cheap money was more needed in this country than ever before, and when the Bank of England was reducing its interest rate. Explanation was needed as to why this was done at a time when increases in bank dividends were being indicated. The Labour Party proposed to transfer from the private banking monopoly power to act as a central bank and to concentrate full power in a State Bank, which would have the sole right of note issue and would provide machinery for cheap credits for public undertakings and primary and secondary production.