Reserve Bank of Australia Annual Report – 1964 Annual Accounts

The balance sheets of the various sections of the Reserve Bank at 30th June, 1964, together with comparable figures at 30th June, 1963, appear on pages 28–29 and 30–31 of this Report.

A change in the form of presentation of the balance sheet for Central Banking Business has been made; Term loan fund accounts of trading banks, previously included in Other deposits of trading banks, is now shown separately.

The Main Changes

The aggregate balance sheet shows that Gold, and balances held abroad and Other overseas securities, which together comprise the Bank's holdings of gold and foreign exchange, rose in 1963/64 by £160 million and £66 million respectively. Australian Government securities (including treasury bills) held by the Bank fell by £58 million; holdings of Treasury bills declined by £34 million and other Government securities by £24 million. Loans, advances and bills discounted declined by £35 million, being mainly the reduction in outstanding advances of the Rural Credits Department to wheat and other rural marketing authorities.

On the liabilities side, Australian notes on issue decreased by £2 million; Deposits, bills payable and all other liabilities increased by £145 million—the Central Banking Business balance sheet shows that Statutory Reserve Deposit Accounts of trading banks rose by £116 million, resulting from the increase in the S.R.D. ratio from 11.5 per cent to 15.5 per cent and the substantial growth in deposits with trading banks (i.e. the S.R.D. base); Term loan fund accounts of trading banks declined by £8 million, drawings on the Fund by banks in respect of loans to customers exceeding additions to it during the year; Other deposits of trading banks rose by £8 million; Deposits of savings banks increased by £31 million, reflecting the record increase in their own depositors' balances over the year; Deposits of overseas institutions, which includes deposits of overseas governments, central banks, and international financial institutions, fell by £3 million; other liabilities, which include deposits of Australian Governments and other central banking customers and provisions for contingencies, showed little variation over the year.

Inter-departmental accounts — mainly advances by the Central Bank to the Rural Credits Department — amounting to £52 million, have been offset in the aggregate balance sheet.

Profits

Net profits of the various sections of the Bank for the year ended 30th June, 1964, after deducting amounts written off bank premises and amounts provided for contingencies, were as follows:

Of the net profits, £15,982,795 was paid to the Commonwealth of Australia, £2,737,733 to the Reserve Funds of the Bank' and £246,371 to the Rural Credits Development Fund.

A comparison of the above figures with those for 1962/63 given on pages 28 and 29 shows that net profits in the three sections rose in 1963/64. The increase in profit from Central Banking Business arose from a generally higher level of assets, particularly overseas investments on which average interest rates were slightly more favourable than in 1962/63; an increase in the amount of interest paid on deposits in Australia provided some offset. The rise in Note Issue Department profit reflected higher average earning rates on assets held, while a higher average level of outstanding advances during the year was responsible for the increased profit in the Rural Credits Department.