The focus immediately after the war was on stability with little regard given to the efficiency of the financial system. This was consistent with extensive government intervention and regulations in other markets. As a result, in the early post-war period, the Australian banking system was highly constrained.
There were tight controls on interest rates for bank lending and borrowing, on terms to maturity of different types of deposits and loans, and quantitative and qualitative controls on banks loans in aggregate and to particular types of borrowers. These were introduced to guard against excessive risk-taking by banks with depositors’ savings and also were regarded as serving the needs of macroeconomic policy.