asked the Minister for Finance whether he is aware that the commercial banks are seeking to contract credits extended to their customers and that this credit-restriction policy is causing considerable inconvenience to manufacturers and traders who had bought stocks on credit extended to them by the banks in order to ensure adequate supplies in the light of existing world shortages; and, if so, what action he proposes to take in the matter.
Ceisteanna—Questions. Oral Answers. - Credit Restriction.
I am not aware of any general contraction of credit by the commercial banks, but note on the contrary that there has been a marked expansion throughout the past 12 months.
Is the Minister aware that the impression exists among the business community that the banks are, in fact, restricting credit more?
I am not aware that the impression exists, but quite possibly it may be mistaken. The actual position is that, so far as bills, domestic investments, advances and acceptances are concerned, there has been an increase of £29.3 million in the current year as compared with May of last year.
asked the Minister for Finance whether he or any official of his Department or any officer of the Central Bank advised, directly or indirectly, the commercial banks, or any of them, that they should restrict the issue of credit to their customers.
I do not know of any advice given to the commercial banks in this matter other than that which was tendered to them on May 2nd, 1951, by the then Minister for Finance, Deputy McGilligan, when in the course of his Budget statement he said:—
"In present circumstances it is desirable that the banks, while continuing to finance capital projects, the laying-in of essential stocks, and normal import requirements, should discourage any merely speculative or excessive borrowing."—(Column 1879, Volume 125, No. 13.)
As the Deputy at that time was himself Minister for External Affairs in the late Government, I must presume that the then Minister for Finance was expressing the Deputy's views also on this matter.
Was he expressing your view?