As late as 1960 in New Zealand, about 90% of commercial trading bank lending was to businesses and only 10% to households. In March 1976 when regulations limiting interest on deposits were revoked, Savings bank deposits totalled NZ$ 4.2 billion while Trading bank deposits totalled just NZ$ 2.6 billion. Trading bank lending was NZ$ 1.8 billion. In New Zealand in 1976 there was about NZ$ 0.3 billion of cash and coin in circulation. As noted above, the figures show that bank lending was largely to supply working funds actually used for the physical production of goods and services. Working funds are not capital in the capitalist sense. They are the productive transaction account money (typically borrowed from banks) used in the productive cycle which is then cancelled when the product is sold. That money forms the dynamic balance of the productive part of M1 in the System for National Accounts (SNA system). Transaction account money is used to build a factory but capital (usually debt) is needed to buy it.
The subsequent period of deregulation in New Zealand amounted to a financial revolution.
By 2003, the debt situation in New Zealand had been reversed. By then, private banks were creating out of nothing more than 90% of household debt  compared to 20% in 1985 and 10% in 1960. The fundamental change that resulted from financial deregulation in New Zealand and around the world was that savings based investment was switched to investment using private interest-bearing bank debt. This is shown in Figure 2.
In Figure 2 existing savings in the blue box are no longer being recycled primarily into new economic activity as they were in Figure 1. They are instead typically channelled either directly or through so-called institutional investors into the exchange of existing non-productive assets. In that sense they perform the same function as the Savings and Loan institutions previously described. To the extent the savings end up in institutional transaction and reserve balances secondary lending is on a one to one basis and there is no cascading effect from multiple secondary lending.