Do you think that an unfair arrangement ?

Yea j any Bank would deal more favourably. What terms do you think any other bank would give ?

At present in London the ordinary banking rate for the sale of drafts on the Colony, which amounted to the same thing, is sixty days' sight at par, and on demand 14 per cent, premium. The money would be paid here on demand at par, and if at 60 days' sight the Government would obtain 1£ per cent, premium. Of course they would lose the interest for the time, but that would not be an equivalent. The 2| per cent, interest is not so good as the 1£ per cent, premium for 60 days. In your opinion does the fact that the Go vernment keep their account in one bank in any way disturb the monetary transactions of the Colony? Yes. Do you know as a matter of fact whether it has done so ? Yes. To the disadvantage of the Colony ? Yes, and quite recently. Do you know of any case where the Bank has constrained the action of the Government to the disadvantage of the Colony? _ Ido not know that I can answer that ques tion, because if I did so I might guilty of a breach of confidence, but I may say that the fact of the Government- keeping its account in one Bank must necessarily nave that tendency, and the Government must be to a certain ex tent in the power of the Bank. Then, in your opinion, if the Government gave its account to an association of Banks, it would tend to avoid the creation of certain political power which must of necessity be en joyed by any one Bank which possesses the Government account ?

Decidedly. Do you think the rate of interest received by the Government for moneys held in England, namely f per cent below the Bank of England, a good one ? No. It is within my personal knowledge that the arrangement made with the Bank of New Zealand was a very bad one for the Colony. I allude especially to the million and a half, which was lodged with the Bank, and which it was understood they would have for a fixed period of six and twelve months. 