asked the Minister for Finance if he will state whether there is any statutory provision or Departmental regulation prohibiting the trustees of Cork Savings Bank from investing moneys in any securities other than British trustee securities; whether he is aware that trustees of British and Northern Ireland Savings Banks are empowered to invest in municipal loans; and, if so, whether he is prepared to take such steps as may be necessary to enable the trustees of the Cork Savings Bank to make investments in municipal loans.
Ceisteanna—Questions. Oral Answers. - Investments By Savings Banks.
Prior to the establishment of the Free State, trustee savings banks were required by law to deposit their funds with the Commissioners for the Reduction of the National Debt and could not invest them in any other way. The British Statutes affecting the commissioners presented such difficulties that no clear provision was then made for the performance in this country of the general range of functions vested in that body, though the matter has been under consideration. In the meantime, the banks have continued to deposit their funds with the commissioners; but it should be noted that, with the consent of the commissioners, the banks may transact what is called "special investments" business, that is, they may accept from individual depositors moneys for investment otherwise than with the commissioners, and among the forms such investments may take are loans secured on local rates. This arrangement would appear to apply to the Cork Savings Bank and the other four Trustee Savings Banks as it does to British and Northern Ireland Trustee Savings Banks, and the need for what the Deputy suggests in the concluding part of his Question does not, therefore, arise. In this connection I note that the resources of the bank mentioned in the Question are of modest dimensions, so that the release of a proportion of its funds could hardly affect appreciably the financing of municipal loans. As regards the position of the Trustee Savings Banks generally in this country, I would refer the Deputy to the comments in paragraph 619 of the main Report of the Commission of Inquiry into Banking, Currency and Credit. The commission's recommendations, which are linked up with recommendations on other matters, such as that of the institution of a debt and investment council, are receiving attention. It may also be observed that Trustee Savings Banks are among the matters mentioned in Article 3 (iii) of the Financial Agreement of the 25th April, 1938, as being reserved for further discussion with the British Government.