D—No. 3

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12. By Mr. Ludlam.] Do you think the Governor should have the power to issue Charters, or shall the power be confined to the General Assembly ?—I cannot say decidedly, but I think a double security is afforded by having the matter referred to the General Assembly. 13. By Mr. Macandrew.] In the event of the Oriental Bank being established in New Zealand and their obtaining the business of the General Government is it your opinion that they would relieve the Colony of the Bank of Issue ?—lf the Oriental Bank should decide on extending its operations to New Zealand, and the General Government feel disposed to arrange with it for the transaction of its business, in connection with the abolition of the Bank of Issue, it would no doubt be met on liberal terms. 14. By Mr. Fitzherbert.] In what consists the advantage to a Bank of using notes ?—The advantage of additional capital for which it pays nothing, by that I understand the power of using credit as capital. 15. What is the average profit on which a Bank may calculate for the non-appearance of the notes issued by it?—l am not prepared to answer, but I would say from my own experience that the profit is very small, on the other hand, it is understood that the Scotch Banks, all having large issues of notes, are considerable gainers. I think in order to induce a Bank to establish itself in New Zealand it ought to have every privilege which can be bestowed including the issue of notes. There are Branches of the Oriental Bank established at the three Presidencies in India, Ceylon, Mauritius, Hong Kong, Canton, Shanghae, Singapore, Melbourne, and Sydney, paid up capital £1,250,000, with power to increase to £2,000,000, the reserve fund is £250,000, returns made monthly to Treasury and published in Gazette. Understanding the principle on which the Bank of Issue is established in this country, and the way in which its specie is invested, I cannot see that the country derives any advantage from it. 16. By Mr. Daldy.] What in your opinion would be the effect of a sudden demand for specie on the present Bank of Issue, looking at its public accounts ?—That its notes would be dishonored unless the Commissariat supplied it with specie, and in any case of immediate sale of its securities, a loss would be entailed on the Country. 17. In reply to Mr. Fitzherbert] In a new country I am of opinion that a greater elasticity may be extended to Banking with safety than in an old, that is to say, always subject to proper restrictions. It was moved by Mr. Hall and seconded by Mr. Macandrew, that the following report be adopted and presented to the House, — That this Committee are of opinion that it is necessary to afford facilities for extending Banking operations in this Colony, and that any obstructions now existing should be withdrawn as speedily as possible, for which purpose the prohibition of the issue of notes by private Banks should be forthwith repealed. William Fox, Chairman.