THE NEW BANKS.

Auckland Star, Volume LX, Issue 33, 8 February 1929, Page 4

THE NEW BANKS.

YET ANOTHER ONE. MERCANTILE OF SYDNEY. Alter a lengthy neriod of quiescence in regard to new banking proposals, this Dominion is experiencing activity that is remarkable by contrast. First came the Dominion and London Banking Association, which obtained its charter from the New Zealand Parliament, and which is now endeavouring to obtain capita] abroad wherewith to commence operation*:. Then came the Australian and New Zealand Banking Corporation, Ltd., which has been registered in Sydney. According to a C'hristeburch paper, forms of application for prospective shareholders in this concern have been circulated by Dominion Broker*. Ltd., of Auckland. However, the secretary of Dominion Brokers, when interviewed by a "Star" representative, denied any suggestion that shares were being offered to the public. He said that a few application forniH might have been handed privately to friends, but there was no intention to offer the shares publicly until the prospectus was also available for issue. This was expected to be the case shortly. The proposed capital of the Australian and Xew Zealand Banking Corporation, it may be stated, is £.5.000.000. Now conies word of yet another banking corporation which it is proposed should operate in Australia and Xew Zealand, and for which shares will be offered in this Dominion. This is the Mercantile Bank of Australia, Ltd., which has been registered in Sydney and inter-States. Its nominal capital is £3.000,000 in £.5 shares, ■200.000 preference. 200,000 A preference, and 200.000 ordinary. It is proposed to issue 50.000 A preference aud 150,000 ordinary shares immediately. 3"he A preference shares, which are to W issued at £1 premium, will be entitled to 8 per cent cumulative dividend, and pro rata with ordinary shares when over 8 per cent U paid on the latter. Boards have alreadv been appointed in Queensland, Xew South Wales, and South Australia. It is reported that the services of one of the leading bank managers in Australia have already been secured, and that £1,000,000 in deposits are available the day its doors are opened. A local representative informed a "Star" reporter that fair support has already been obtained in Auckland, and that an influential local board is being appointed. The prospectus of this bank has already been circulated. Discussing the prospects of new banks in the Dominion, a local bank official expressed the view that the raising of the necessary capital to start operations was by no means the chief essential to success. The real problem would be to lend the money out in such a way as to cover establishment and administrative costs There is plenty of money available for investment, he said, but the difficulty is to find suitable avenues that are profitable and sate.