The Bank of New Zealand.

Gisborne Standard and Cook County Gazette, Volume III, Issue 372, 2 November 1889, Page 3

The Bank of New Zealand.

WHAT THE PREbS SAYS.

The affairs of the Bank of New Zealand have been generally commented on by the Press the opinion being almost unanimous h condemnation of the action taken by Mi Buckley ar the re.-ent netting. The Welling ton Press, in which Mr Wakefield’s pen used t. a'-sail the Bank in the most vigorous way, has the following article on the subject: — Though it was less than two years ago that

the unwelcome news spread through the colony that the Directors of the Bank of New Zealand were unable to declare a dividend, it seems aa if a whole decade had passed over our heads. The interval lias been full of dis asters to some of the largest business firm* of the colony, and has been one of the darkest and most depressing paiiods in our later

colonial history, There is an old joke that a votary of Bacchus being remonstrated with on the excess of his libations to tho god, replied that it was not the getting drunk which he had any reason to deplore, but i begetting sober. We do not suppose that any of those who ran riot in the feverish race of speculation and floated joyously on the deceptive stream of prosperity which ran at full flood in the height of the Public Works Policy, profess to have much regret that they grasped their share and feasted while the feast was on What has been so terrible is the cold grey dawn after the carouse, the chilly hour when the music has ceased, when the lights are out and all the gallant company shrink like pale ghosts at the sight of each other’s haggard faces. It has been indeed a miserable two years for many unfortunate people in all parts of the colony. While numbers once wealthy have been reduced to penury, the margin of comfort of nearly all has been reduced. Labor and capital alike have been continuously deserting the water logged ship, Those who remained found themselves compelled to bear an inordinate taxation to pay the interest of loans which others had dissipated. One of the greatest factors in all these troubles was the Bank of New Zealand Its management had plunged heedlessly into the rash speculation in which its customers engaged, encouraging instead of checking the reckless gambling of commerce and the wild grasp at territorial ownership. The last two years have been years of sackcloth and a?hea for ths shareholders, and unfortunately for their customers the enforced repentance has reacted with most terrible consequences upon themselves. We have not one word to say again -4 the action of the new Managers of the Bank, They had not only the fortunes of the Bank creditors and of the ahareholders to consider, they had also the responsibility of the financial and mercantile credit of the colony upon their shoulders. The least indication o* any hesitating weakness on the part of those pledged to reform the Bank of New Zealand might have brought upon the colony financial disasters by the side of which all that has happened would have been insignificant. We do not suppose for a moment that the present management have committed one act of wanton crue ty, They were too well aware how deeply Culpable hid been the part the Bank had played in the past not to be at least considerate to those who had been the associates and were then the victims of the fatal policy, The Chairman’s reference in his speech to the M large and weak accounts which showed

a tendency to drift and which it was determined to wind up prc.emptorily evan at a sacrifice ” were properties the owners’ interest in which had practically long vanished, properties no skill could save, and the attempt to uphold which could only prolong the misery and perhaps involve more still in the ultimate ruiu. The Chairman spoke hopefully of the landed properties. No doubt a great change has taken place in the last year in the returns of many pastoral properties, and of go;d agricultural land, while the extraordinary price of flax has put life into other properties which seemed three years ago to be valueless. The Bink is justified, if, as the chairman says, they can obtain a large increase of revenue in the sale until the liquidation can be effected on terms not disastrous to the bank, Turning to the increase of advances by £560,000 we have the Chairman’s assurance that these advances are of a sound, liquid character, in other words the Chairman assured the shareholders that the Bank had entered on its new departure, that while it is contracting the old mass of undoubtful securities it ia laying out its assets on honest banking principles, that it is no longer engaged in encouraging speculative traders or too enterprising squatters, but is making its advances on sound business terms, and to healthy purpose. There is no doubt that this report of the Bank of New Zealand will give a fresh sense of security to commerce, and lend great encouragement, to the people and greatly strengthen our position on the Home market. The proposal to transfer the headquarters of the management to London will, perhaps, be somewhat an unpalatable dose for four friends in Auckland to swallow, but the Directors hold it necessary, and we see no just reason for disputing - their judgment. It must be remembered that the English depositors contitute a very heavy interest, and the English shareholders are hardly less weighty in their number and influence. If it is held that there is no permanent and effectual barrier against a return to the fatal policy of the past, except the removal of the management from the influences of colonial pressure, no friend of the bank or of the colony would hesitate in urging the shareholders to accept the advice which the Directors press upon them. The Bank will gain many advantages from the seat of the great money4narket of the world, and in those advantages the colony and the customers of the Bank will most unquestionably share. That the Government will have no longer the pliant servant at their elbow is certainly no matter of regret, and indeed we shall hold it to be one of the greatest gains that, whatever Ministry is in power, it will have to deal in the matter of advances with a strictly business manageipent in London, snd not with a directory here who by turns complaisant have by turns been quite sufficiently exacting in their demands for recognition of their services. We have only a few words to add as to Mr Buckley’s speech. Much as we respect Mr Buckley and highly as we esteem his character and ability, we cannot think that any useful purpose was served by his speech, That speech if made at all should have been made long ago. .Mr Buckley declares that 1! the Committee had known fifteen months ego the true state of affairs they would have reported that the Bank should be wound up. But the Committee found out in 1888 that the branch account certified to them were u unreliable and misleading, and that the oertificatet were worthless to authenticate and support the Mr Buckley knew all about these affairs before December last. He asserts that in addition to the sums already sacrificed by the shareholders, there is £300,000 more still to be written off. Major George brought an allegation against Messrs Buckley and McLean which attaches an even graver aspect to his long reticence, and deprives hi® present candour of any substantial value. He says that they have sold out all their shares but five and ten respectively. Mr Buckley’s speech, if it had to be made, should have been made from the Presidential chair in April last, just six months ago. It is a disagreeable episode, but it should be nothing more. It will perhaps increase the difficulties of the Bank for a time, but it leaves it perfectly sound *nd substantial, and the removal of the Directory to London will complete the work. That should not be delayed,