AUSTRALIAN BANKS.

Inangahua Times, Volume VIII, Issue 1324, 16 November 1883, Page 2

AUSTRALIAN BANKS.

I % « . — The remarkable expansion of Australasian banking business and profits within the past year is attracting the notice of English commercial authorities. The 'Economist' devoting an article to the subject, illustrates the position by reference to seven of the leading banks, whose net profits amounted to £524,6(60 for the half-year 1882-3 against £472,706 for the halfyear 1881-2. The management (says the ' Sydney Morning. Herald I) isverj properly credited with prudence in not dividing the , iyjb,ole amount aniottg shareholders. The dividends weiUi increased in most cases, the average increuse being frotn^.ls^ to lG^per-cent; but this left £89,160. t0 go to reserve, against £42,706 iv the earlier half-year. The encreased profitableness to the» banks is rightly attributed ta the immense' demands vn b&nk reßOiircesl

involviugthe'use of their capital and all the they could borrow, to ah exteirtFtiever before known, or iudeed neser before possible. The banks haOanly been able to obtain additions to their deposits to the extent 0f^4,000,000, with but very slight accretions to capital, while they had v&tu red on business obligations £9, 000,000, in excess of tbeir previous total. The enlarged denands are of course mainly due to the purchase of land on credit with bank capital, and to the competition of traders, resulting \in over-importation . But the losses of crops and the destruction of sheep by drought seriously reduced the assets, probably to an extent equivalent to the difference between the figures on the two sides of > the bank accounts. In the ~ great iner ase of their loans, of course thi banks made their enla,rg«l profits. This boon of Australasian banking hai| apparently not reached ita^ cluininating ; point,, for later return^ to our English aujfhofities J shtfw..lyet greater advances, and show corresponding enlargement of deposits or pther banking funds. But the commercial community here know that babka : are holdinij their purse-strings tightly |»nd V'th the incofu ing" to. - the" prooeesds-of . 4he wool: clip ,tip& "Bf the yj&ry ' : promising graiu harvest in all i*ie, A.ustraiiofc^la; hies,4ih«-pressnre-on the tiank resources ' will probably be less severe. Notwithstanding the iluctnations to which banking is exposed in the colonies, it has been. remarked by an, other English writer. ; that their career has on the^ whole , been .wonderfully successful . "It is- said v Only a few of the Eastern banks of seventeen or eighteen years ago no^ remain, while during that period, "no Australian bank of a»y importance has closed its doors."