74 INFORMATION REI^ATING TO CREDIT 



GERMANY. 



THE BANK OF THE EANDSCHAFT OF EASTERN PRUSSIA AT KOENIOSBERG IN 



igi5-iqi6. — Dcr Deutsche Ockonomist, Berlin, 29 July iyi6. 



When once the pre-war conditions of administrative Hfe had been re- 

 estabHshed in Eastern Prussia economic life could resume a more normal 

 course within this bank's sphere, thanks to State support and to the antici- 

 pated payment of indemnities for losses by the war. The bad harvest of 

 1915 certainly made recuperation slow, and agriculture had still in many 

 respects to siiffer from the measures rendered necessary by the war. 



The war gave a particular character to economic life. The flocks and 

 herds could not be maintained at their formier level : in many cases it was 

 impossible to procure manures and concentrated forage in sufficient quan- 

 tities, and on the other hand the sale of live stock and agricultural products 

 reached important dimensions. Many products which were used for pro- 

 duction in time of peace were converted into money which flowed into the 

 banks and savings banks. The quite extraordinary^ increase in the deposits 

 of the Bank of the Landschaft of Eastern Prussia is thus explained. For the 

 same reason a reduction was noticeable in several cases in the investments 

 on current account and other investments, which were transferred to credit 

 accounts : although after recurrent oscillations the total decrease was more 

 important at the end of the year, particularly as a consequence of subscrip- 

 tion to the war loan. The funds entrusted to the bank and the impor- 

 tant sums paid into it by savings banks necessarily remained available owing 

 to their particular character, and were consequently used to buy Prussian 

 and German interest- bearing treasury bonds. At times the bank held more 

 than 47 million marks (i) in these bonds. The issue of bills naturally de- 

 creased owing to the interest taken in the war loans. The banks could there- 

 fore grant considerable quantities of bills at moderate rates, gradually 

 put a term to those financial operations of the Landschaft which were pend- 

 ing at the beginning of the war, and take back the bills issued b}' the Land- 

 schaft. 



(i) I mark — 11 3/^d. at par. 



