THE BANK OF NEW ZEALAND.

Gisborne Times, Volume XXX, Issue 3554, 20 June 1912, Page 2

THE BANK OF NEW ZEALAND.

ANNUAL MEETING. HELD AT WELLINGTON YESTERDAY. THE YEAR’S WORK REVIEWED. ITER PRESS ASSOCIATION.] WELLINGTON, June 19. The annual meeting of the Bank of New Zealand was held to-day The Chairman (Mr. Martin Kennedy), in moving the adoption of the Report and Balance Sheet (which had been distributed some da vs previously), said:—

Ladies and Gentlemen, —1 presume you will take the Repart and Balance Sheet as read. 1 feel sure you will consider them highly satisfactory. I am glad to say that we have had a good year, the profits being the highest yet earned by the Bank in any year since its commencement in 1861. The Directors are pleased to be able to recommend the payment of a dividend on all the shares of the Bank, amounting to—on the Ordinary Shares, 15 per cent, for the year, and on the Preference Shares, 10 per. cent the statutory limit. Turning to the Balance Sheet—• Capital. —There is no change in the paid-up capital of the Bank, which remains at £2,U00,000.

The Reserve Fund. —Last year this Fund was increased to £1,600,000 by the addition of £200,000 from profits, and the Directors propose to place a similar sum to the credit of the Fund out of the profits for the year under review, making the total £1,200,000. With the amount proposed to lie carried forward, namely, £40.587; the Reserve Fund and Undivided Profits will amount to £1,240,587. As you will observe £500,000 of tho Reserve Fund is invested in British Governement Securities. Notes :rs Circulation, which stand at £1,030,966, show an increase of £53,720 as compared with the previous year.

Deposits are less by £2,052,878 than the figures of a year ago, the decrease being due to reduction in Government credit balances which, in the last Balance Sheet, were abnormally high. Ordinary deposits, both fixed and free, show a" satisfactory increase. Bills Payable and OGisr Liabilities show a comparatively small fluctuation, being less bv £71,937 than at March 1911.

Coin, Bullion, Money at Short Call, Etc. —You will observe that Money at Short Call, Government ancl Other Securities in London stand at £3,810,159. This amount, as compared with the previous year, shows a decrease of £3',394,050, attributable to the reduction previously mentioned in Government balances and to the withdrawal of funds from London to meet the active demand for accommodation in the Dominioli. Coin and Cash Balances also show at a lower figure, the amount under this head, plus Bullion, being £205,589 less that at March, 1911, the reduction in liabilities already referred to rendering maintenance of the high cash reserve of last year uncalled for. I may point out that the totals under this heading, together with the amount of Bills Receivable and Investments in the Colonies, are equal to 55 per cent, (or 11s "in the £) of the total liabilities of the Bank to the public. Bills Receivable, ill London and in transit, stand at £2,400,260, an increase of £111,615 on the figures of the previous year. Investments in the Colonies are less by £72,763 than at 31st March, 1911. ‘ Advances. —Bills Discounted are greater by £109,439 and Other Advances by £1,729,633, as compared with' the* figures of a year ago, and now stand at £1,221,075 and £9,667,748 respectively. During the year there has been a strong demand on the Banks and other financial institutions in the Dominion for accommodation, and, although adopting a restrictive policy for some time past, we have, as the figures 1 have placed before you indicate, responded reasonably to the call. Our'present policy is to maintain ourselves in a position to meet the legitimate requirements of our established connections and of tho Dominion’s industries and trade. With regard to Advances, let mo repeat that the greatest care is bestowed by your Directors- and the Executive Officers upon this most important branch of the Bank’s business.

Assets Ftealisation Board Assets— Totals under this heading now amount to £136,350, as against £216,354 last year. You will notice that the item ‘‘Sundry Assets Unrealised” has disappeared from the Balance Sheet, practically all the Assets Realisation Board properties having beeii diposed of.

Landed Property and Premises, after appronriation now made of £25,000, stand at £420,538, as compared with £423,739 at 3ist March last year. Profit and Less. —The profits, representing the work of our Jubilee year, show at £3966,182, an increase of £40,911 on the profits of the previous year. After paying the £40,000 interest on Guaranteed Stock ana making all necessary appropriations, 1 including provision, for the Bank’s ; annual grant to the Provident Fund ‘ and Bonus to the Staff, as well as allocating the sum of £25,000 in reduction of Bank Premises and Furniture lacounts, the net profits for the year amount to £331,182, as compared with £295,279 last year. Adding I the amount brought forwalrcl from last year (£34,405) and deducting the amount of interim dividend at 6 per cent. on. Preference and Ordinary shares paid ,in December (£60,000), the sum available for distribution, is £305,587. The Directors now propose to pay ia further dividend of 6 per cent, and bonus of 3 per cent), on Ordinary. Shares (making 15 per cent- for the year), and a further 4 per cent, on, Preference Shares (making 10 per cent, for tho year). The total amount distributed to shareholders will therefore lie the same as last year, namely, £125,000. ‘Of the balance remaining, it is .proposed to transfer, as already mentioned, £200,OCO to the Reserve Fund and to carry forward £40,587. The dividend and bonus will be payalto in Wellington to-morrow, 20th inst.j and at Branches on receipt of advice. Ganeral. The progress of tho Bank since its re-construction in 1894 Imving been (Continued on next page-)

!so fully put on record at our annual i " meeting last June, I need not enlarge j upon it- further than to note with satisfaction. the rapid growth of our 1 Reserve Fund, which in 1906 stood at £81,294 and to-day, after the proj posed transfer of the £200,000, will: ( stand: at £1,200,000. This acciunulai tion lias been made practically in the ! course of the last six years. ! As ia consequence of adherence to a ! cautious policy, the Bank’s leases have ! been exceedingly light. It is this j fact, coupled with the prosperity of the Dominion and the great expansion of settlement- and production that has taken place during the last eighteen years, that has made this splendid achievement possible. Indeed, it may bo said that the prosperity of the 'Dominion during the years referred to has been reaffected in the Bank’s Balance Sheet. The Bank’s interests being so intimately associated with those of the Dominion, it is pleasing to know that the revenue of the Dominion for the financial year ended 31st March last is a “record/’ being reported as £ll,032,544 —an increase of over £735,000 on the previous year, consisting principally of: Customs £251,000 Railways 182,000 Stamps 123.000 Land and Income Tax 60,000 The expenditure for the year is stated to be £10,340,000 under . all heads.

As some indication of the expansion of production and trade of" the'Dominion, I quote the totals’ of the combined Imports and Exports for the last seven years, which show an increase of about £10,000,000 for that period. I quote the Imports and Exports combined.for a series of years, as the imports and exports of any particular year may be affected by late seasons, shortage of tonnage, etc. The following are the combined figures: Year ending l 31st March, 1906 £29,445,541

Year ending 3lst March, 1906 £29, You will see that the expansion may be regarded as satisfactory. You will also be interested to learn that the undeveloped Native lands in the North Island, alluded to previously at our meetings, have been receiving the attention of the • Government since the passing of the Native Lands Act, 1909; so much so, that the Commissioner, in a recent address, assures the public the desired end will be attained within three or four years. Upwards of one million acres have already been alienated and settled during the past two years, and further alienation and opening up will be proceeded with as fast as surveys and reading can -be accomplished. In like manner, the available Crown lands are receiving attention, with the object of bringing them into profitable use by lease or otherwise.

Much of the Native lands is superior in quality and covered with heavy bush. The difficulty of promoting close settlement upon such land lies in the large amount of money required for roading and improvements. To a large extent, we have to look ouisioe the Dominion for -the funds to carry out these works. If we had to depend entirely upon our own resources, development- would be retarded for many years to come. The borrowing of money within reasonable limits, for the purpose of bringing such lands into profitable occupation and for acquiring other lands for close settlement, is fully justified- By such means, openings will bo made for numbers of immigrants—especially of the farming class with experience and -small means, and farm laborers. It is to the at- present undeveloped and unsettled portion of the North Island that we look, in the near future, for any large expansion in -the export trade of the Dominion. Board of Directors. You are doubtless aware that the Board consists of six members, two representing the holders of the Ordinary Shares and four representing the Government, the holder of the Preference Shares. One of the two representing the Ordinary Shareholders retires yearly and the vacancy is filled ■by election at the December halfyearly meeting. Mr. Kennedy was re-elected in December last. Two of the four Government appointees retire yearly and the vacancies are filled, in terms of the Statute, not later than the first "Wednesday of March in each year. Last March, Mr Milne and Mr Beauchamp’s terms expired and, as you know, the vacancies were filled by the Governmentappointing Mr. W. Milne and Mr. D. J. Nathan.

Advices- received from Mr. Beauchamp in London had indicated that his health would not permit of his •seeking re-appointment. Upon his retirement, the Board placed on record its high appreciation of the very valuable services rendered by him to the Bank during the thirteen years that he occupied a seat on the Board, and more particularly during the last five years when he filled the position of Chairman- lam quite sure you will all concur in this recognition of the good work performed by Mir Beauchamp for the Bank. Mi - Milne’s re-appointment gives us nuich pleasure; and Mr. Nathan’s wide business experience and commercial training will no doubt be of considerable assistance to the Board in its deliberations..

We welcome back Mr. W. Watson, who was absent in London when our half-yearly meeting was held in December last. While in London, Mr Watson attended several meetings of the London. Board. These meetings of your Diretcors with the London Board are regarded ov us favorably, as being conducive to the good of the Bank.

I may mention that Mr. Watson’s present term of office expires on 31st March next, and that it is his intention to offer himself for re-election. Of the original members of the Board who took office when the Bank was re-constructed in 1894, Mr. Watson mid myself alone now remain. Directors.

Mr. J- Bv Reid is at present absent from the Dominion on a visit to Europe. During his stay in London .Ire will be associated with the Local Board in, that City. My colleagues have done me the honor of .unanimously eletcing .me ?r> the, position of Chairman for the year, I need hardly assure you that tile best of my abilities will bo devotee' to the duties of the position and the promotion of the prosperity of the institution with which I have been, now, closely associated for nearly .eighteen years, you having, re-elected me each alternate year during that period unopposed. London Board We have pleasure in again referring to the great care and attention bestowed upon the Bank’s business' in

London by the members of the Board there.

i Staff. ( ‘t affords us pleasure to once more record our appreciation of the zeal | and ability displayed by our staff in : New Zealand, Australia, Fiji, and Lor don.

In view of the increased cost of living and of the greater responsibilities devolving upon the staff consequent upon, the expansion of our business, the Board, at- the annual revision of salaries, has dealt with the. remuneration of officers on a more liberal scale than in former years. The Board has recognised -their good services by granting a bonus of 5 per cent, for the year on their salaries, and I feel sure you will approve our lil erality. Much of our prosperity is due to the zeal and ability of our staff. They have worked, well, and it l-s only fitting they should be encouraged.

New Branches.

During the past year, wo have opened six new Branches, fivo Agencies have been made Branches, and seven new Agencies have been opened. You will see, therefore, that we continue atcive in the establishment of outposts to- meet the growth of settlement- This is a- matter which engages our constant attention, and we are always ready to consider the claims of growing districts in a sympathetic manner. Wherever reasonable inducement is found to- exist, we are prepared to afford banking facilities.

In conclusion I desire to remark upon the present gratifying state of the markets for the staple products of .the Dominion. Wool, frozen meat and dairy produce are all commanding satisfactory prices and the outlook for the coming season in this respect is distinctly good. In the Mother Land and in Europe, we find that political complications during the year have given rise to • many uncertainties and apprehensions as regards the future, aid in Great | Britain, the closing months have been marked by an industrial struggle the seriousness of which has, I fear, hardly yet been thoroughly apprehended, hut .which there can be no doubt lias resulted in the loss of many millions of money to the Britsih nation. Unfortunately, the end of such conflicts docs not appear to bet yet in sight, the strike of the London transport workers being at the moment in progress and entailing a considerable amount of inconvenience and loss upon the mercantile community. British capital has, as a consequence of these disturbing conditions, been shy and sensitive, and the London money market uncertain and in a state of tension. Owing to the combination of unfavorable conditions, to the shortening supply of .capital, and t-o the steady expansion of our own industries involving a continuous demand for financial assistance in the development of the country, a hardening tendency in the local money market is at present being displayed. I don’t think there is any other matter I need now refer to, and I have pleasure in moving that the Report, and Balance Sheet be adopted. Mr Watson seconded the motion for the adoption of the report, endorsing the views of the chairman. He said he would stand for election on the directorate again in December.

Mr John Mill congratulated Mr Kennedy on his election as chairman, and on the good report of the year’s transactions. He also approved of the Board’s statement as to the staff. He said living had gone up and the officers had to wear their Sunday clothes every day of the week.

A vote of thanks to the board of directors and staff was carried.

In reply to a shareholder’s inquiry regarding the Bank’s obligation to the Government, Mr Kennedy said many shareholders were under the impression that the guarantee was money owing to the Government.. It was nothing of the sort; it was money due ia London on guaranteed stock. Its redemption would not put any more money in the coffers of the Governmentj Still the question of renewal of the guarantee or paying it off would limit the Bank’s power of lending.

do. ' 1907 34,853,034 dos 1908 36,079,509 CiO. 1909 33,832,431 do. 191036,845,390 do. 1911 39,257,085 do. 1912 59,531,996