Rates of Interest on Deposits

Manawatu Times, Volume 62, Issue 25, 30 January 1937, Page 4

Rates of Interest on Deposits

i PRIME MINISTER EXPLAINS REGULATIONS. Per Press Association. WELLINGTON, Last Night. An explanation of the new regulations fixing the maximum rates of interest payable in respect of the period after March 31, on deposits made with Building and Investment Societies and with trading companies, was given today by the Prime Minister as actingMinister of Finance. Regulations were gazetted this week, Mr {Savage said, under tho National Expenditure Adjustment Act, 1932, whereby the Governor-General-in-Coun-cil was empowered to fix tho maximum rate of interest that might be paid by Building and Investment {Societies and by trading companies on moneys deposited with any such societies or companies. It was, however, provided by that Act as amended by the Finance Act, 1934, that no Order-m-Council should apply for any period commencing after March 31, 1937. From time to time successive Orders-iu-Couneil have been issued fixing the maximum rates of interest on such deposits, each such order applying only to new deposits made after tho issue of tho order and to renewals made after that date, of deposits made before such date. The last Order-in-Council (applicable to deposits made on or alter August, 1934) fixed the rates as follows according to the terms of such deposits: —At call or for any period less than three mouths, Investment and Building Societies, 2 per cent, per annum, trading companies 2£ per cent, per aunum; from three months to six months, 22 and 3J respectively; from six mouths to one year, 3 and 32; from one year to two years, 31 and 4; from two years to three years, 32 and 4i; three years or over, 4 and 42. As stated above, existing Orders-in-Council have no application to any period after March 31, 1937. This limitation was removed by Section 46 of the Finance Act of last session thus permitting the Governor-General-in-Council to fix the maximum rates of interest without any limitation of time. The Prime Minister stated that it is considered necessary in tho interest of the Dominion, that the Government should still retain control of tho rates of interest that may be paid on deposits with trading companies ana Building and Investment Societies and accordingly Orders-in-Council were issued ou the 21st instant, continuing for a period after March 31 next, the same maximum interest rates that are at present in force in respect of deposits made with trading companies and Building and Investment Societies.