39
compilation and publication by Government of a quarterly
summary of banking business generally in Palestine without
disclosing the names or respective position of the
individual Banks.
24. We may now turn to items (b) and (c) of our terms
of reference which are as under:-
"To consider the practicability of and to make
25.
recommendations regarding
(b) fixing a minimum cash reserve as a percentage
of deposits;
(0)
limiting the use of short-dated deposits or
current accounts to short-dated investments.
It is the fact everywhere that only a very small
proportion of the public have sufficient knowledge or
acumen to form any opinion from the most informative of
published statements as to whether the standing of a Bank
is good or bad. It is also the fact that in Palestine
many of the small Banks which have in our opinion an
inadequate amount of capital invested in the business also
lack the necessary knowledge or experience of banking
demanded of bankers. It is important therefore that as
far as practicable depositors should be protected from the
danger of certain of the local Banks being unable to repay
deposits on due date or on demand owing to investments
imprudently made from the point of view of security or
period.
26. In the first instance, we endeavoured to treat
(b) and (c) of our terms of reference separately; but our
deliberations brought us to the conclusion that the
problems are to a great extent identical in their object
of ensuring the liquidity of assets sufficiently to meet
claims of depositors for withdrawals.
27.