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Thursday, 11 October 1956

Mr Whitlam m asked the Treasurer, upon notice -

1.   What interest rates have been charged in the last ten years by (a) the Commonwealth Bank of Australia and the private trading banks on (i) overdrafts to building societies, and (ii) credit foncier loans, and (b) life assurance companies on housing loans?

2.   What monthly amounts would a home purchaser have to pay to these banks, societies and companies to repay a loan of £2,000, of £3,000. and of £4,000 at the respective rates of interest over each of the following periods: - 15, 20, 25, 30 and 35 years.

Sir Arthur Fadden (MCPHERSON, QUEENSLAND) (Treasurer) - The answers to the honorable member's questions are as follows: - 1. (a) (i). The interest rates charged by the Commonwealth Savings Bank and Commonwealth Trading Bank on loans to government guaranteed terminating building and housing societies in New South Wales and Victoria over the last ten years have been as follows: - January, 1946, to July, 1952, 37/8 per cent.; August, 1952, to March, 1956, 41/2 per cent.; since April, 1956, 5 per cent. It is understood that the rates charged to building societies by private trading banks have been substantially the same as these, (ii) The rates charged by the Commonwealth Savings Bank on credit foncier loans have been the same as those charged to building societies. Before 1952, these loans were made by the General Banking Division of the Commonwealth Bank. The Commonwealth Trading Bank and the private trading banks do not make credit foncier loans but lend for housing purposes on overdraft. It is understood that most current housing advances bear interest at 5 to51/2 per cent, (b) The rate of interest charged on housing loans by life assurance companies is a matter for the individual company. It is understood that, at present, most of these companies are charging either 51/2 or 6 per cent, on housing loans.

2.   The following table shows the monthly credit foncier repayments for each £1,000 borrowed at various interest' rates and for various terms. It should be noted, however, that most lenders impose certain limitations on both the amount which can be borrowed and the term of the loan.

In the case of trading bank overdrafts, repayment is a matter for arrangement between banker and customer: -


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