State bank

As a result of the financial crisis sparked in late eighteen ninety, a Banking Royal Commission was held in Victoria.

While the inquiry was running, the forerunner to Victoria's State Bank, the Commissioner's Savings Banks, adopted a unique model of finance for home and farm loans, which had been presented to the Melbourne Chamber of Commerce by an expert in the matter from Austria-Hungary.

The Royal Commission advocated the same approach of credit foncier loans, which it described as loans for long periods at low rates of interest and light charges with easy conditions of repayment when it reported in November eighteen ninety-five.

As noted, the Savings Bank had already moved with a limited form of this lending, limited to deposits alone.

But when it merged with the Post Office Savings Bank as recommended by the Royal Commission, full use of the mechanism was enabled with the issue of debentures and mortgage bonds.

Refer to the Ascent and Destruction of Sovereign Banking in Australia, Part three: A Banking Revolution in Victoria, Elisa Barwick, Australian Alert, twenty twenty-five, and the Credit Foncier System, paper by Mr. Carl Pinchoff, and State Banking Report of the Royal Commission on State Banking, Victoria, eighteen ninety-five.

State banks in every state provided cheap housing loans from nineteen ten, but these were fairly constrained until state housing commissions were established.

The Credit Foncier Department of Victoria's State Bank provided long-term cheap loans, at first for farmers, and by nineteen ten for housing, too.