AUSTRALASIA. 



55 



which IM. 000,000 had I,, en Mlh-cribcd and 



000 jiiiid in. Deposits amounted to about l'.">.- 

 000,000, of which ($,261,000 belonged to Scottish 



iim-iors. 'I'lit- failure was due l<> advices cabled 

 fnun l.niiiliiii that none of the Scotch deposits, 



1 IK- larger part of which matured at an early 

 date, would be renewed. Tim local depositors 

 had stood loyally by the bank, and there had 

 been no run upon it. The bank had but 5 

 brandies, all in Victoria, The Hoyal Bank of 

 Queensland, Limited, with the head office at 

 Brisbane, suspended on May 17. Its authorized 

 capital was 1,000,000, of which 750,000 had 

 been subscribed and 375,000 paid in. On Dec. 

 :(l. 1N92, the total liabilities of the bank were 

 61,889,606, of which sum 434,049 were due to 

 t he shareholders and l'!rJ7,550 to the public, the 

 deposits being 708,949. A half-year dividend 

 of 5 per cent, was declared. The bank had 21 

 branches. On the same day there was a run on 

 the Savings Bank at Brisbane, but all demands 

 were promptly met, and it soon subsided. 



New Banking 1 Laws. At a conference be- 

 tween the ministry of New South Wales and the 

 managers of the banks doing business in Syd- 

 ney the Government pledged itself to use its 

 power to maintain the credit of the solvent in- 

 stitutions of the colony. A bill was introduced 

 in the Legislative Assembly providing as a per- 

 manent enactment that all demand notes of 

 any bank in the colony shall be a first charge on 

 all assets and property of such bank ; and as a 

 temporary enactment, to have force for twelve 

 months only, that the Governor in Council may 

 at any time, by proclamation duly published, 

 make the notes of all banks designated in such 

 proclamation legal tender throughout the col- 

 ony for a limited period not exceeding the ten- 

 lire of the act. Before making such proclama- 

 tion the Governor must be satisfied that the as- 

 sets of each bank to be included therein exceed 

 its liabilities to creditors by at least the sum of 

 the paid-up capital and the reserve profits, and 

 he may require from each such bank adequate 

 security for the payment of all its notes in gold 

 upon presentation after the expiration of the 

 period named in the proclamation. The bill 

 further provides that if any note of any bank 

 covered by the proclamation shall not be paid 

 upon due presentation at the bank's head office 

 in the colony, the Government shall be liable to 

 Knjbonajide holder (not being a bank) at any 

 time within six months after the expiration of 

 the period limited in the proclamation, and the 

 colonial Treasurer shall pay such note in gold 

 upon presentation. The bill was promptly 

 passed, and became law by the Governor's assent 

 on May 3. Immediately after the suspension of 

 the Commercial Banking Company, May 15, a 

 proclamation was issued under the act making 

 the notes of the Bank of New South Wales, the 

 city Bank of Sydney, the Union Bank of Aus- 

 tralia, and the Bank of Australasia legal tender 

 within the colony for six months. The Bank 

 of Australasia and the Union Bank of Aus- 

 tralia received instructions from their head of- 

 fices in London instructing them that, while not 

 hostile to the Government plan, they would con- 

 tinue to pay gold to their customers if required. 

 The Government of New Zealand decided to in- 

 troduce a similar bill for that colony. 



On May 2'! tin- I'nme Minister of New South 

 \\ ;:les introduced u bill which provides that any 

 holder of a current account with any MMMDdM 

 hank in the colony may obtain from the pro- 

 visional liquidator thereof a certificate of the 

 amount of his current balance, and on pretmntu- 

 tion of the same at the treasury receive an ad- 

 vance of one half of the amount in treasury 

 notes. The certificate, which forms the security 

 for the advance, is to be indorsed over to tin- 

 Treasurer, who will be entitled to stand in tin- 

 place of the original holder of the account ; but 

 this does not give the claim the priority of a 

 Crown debt. The Treasurer is to be reimbursed 

 out of the moneys payable to the holder of the 

 current account. The original account holder 

 has the right of redemption at any time within 

 five years, and the currency of the treasury 

 notes is limited to five years. The Treasurer is 

 to withdraw from circulation at the close of every 

 month notes equal to the sums received during 

 the previous month in reimbursement of any ad- 

 vances, and the issue of these notes is not to ex- 

 ceed the 2,000,000 authorized. The Treasurer is 

 also required to publish a monthly statement 

 of the amount of notes outstanding, and of the 

 moneys received in liquidation of the notes in the 

 preceding month. The bill passed the Legislative 

 Assembly on May 25. and the Legislative Coun- 

 cil on the following day, and became law by the 

 assent of the Governor. This measure was se- 

 verely criticised in the United Kingdom, but it 

 gave great satisfaction and much relief in the 

 colony, where there were 57,000 people having 

 current accounts to the amount of about 4,000,- 

 000 locked up, some of them offering to sell 

 their claims at 50 per cent, discount. 



In Queensland a similar measure for the relief 

 of the holders of current accounts was passed, 

 and a law was likewise enacted authorizing the 

 issue of treasury notes of 5 or any multiple 

 thereof, payable on demand in gold. The issue 

 of such notes must not at any time exceed the 

 amount of cash and treasury notes then held 

 by the Government, and coin must be held to at 

 least one third of the value of the notes so is- 

 sued. The act also provides that the Governor 

 in Council may upon emergency proclaim such 

 notes full legal tender throughout the colony for 

 a specified time. A further enactment provides 

 for the issue of 4-per-cent. treasury bills having 

 a currency of four years, to the amount of 

 1,000,000. These are to be vested in trustees, 

 and to be negotiable only to meet demands upon 

 the treasury under the act authorizing the issue 

 of demand notes. A further enactment provides 

 for an increase of the tax on the notes issued by 

 banks from 3 to 10 per cent., the object being to 

 cause the withdrawal of such notes from circula- 

 tion ; but a& to notes already issued, the new tax 

 will not be imposed until the expiration of two 

 years. A fourth enactment deals with the notes 

 of the banks that have suspended payment. It 

 requires that every such bank in the colony 

 shall pay its notes in the same manner as if it 

 had not suspended, and the colonial Treasurer 

 is authorized to advance to the said banks treas- 

 ury notes in exchange for their own retired 

 notes, which are to be held by the treasurer at 

 4 per cent, interest, and be a Crown debt against 

 the assets of the banks. 



