HC Deb 22 February 1938 vol 332 cc191-2
51. Mr. G. Strauss

asked the Chancellor of the Exchequer whether he is aware that British banks pay 1 to 1½ per cent. on substantial deposits; that Swedish banks pay ½ per cent., American banks ¼ per cent., and Dutch and Swiss banks pay nothing; and, as the rate of interest paid by British banks is an important influence in attracting foreign deposits to this country and swells the country's adverse balance of payments, will he take legislative steps in the national interest to remedy this situation?

Sir J. Simon

As the hon. Member is aware, there is no fixed rate of interest on foreign short-term deposits in this market. The particulars he gives for other markets may well be correct, though I am not aware how far the rates are effective rates. As I said in my reply of 15th February, the rate of interest is by no means the most important factor in determining the international location of foreign short-term deposits at the present time. In these circumstances the answer to the last part of the question is in the negative.