THE BANK OF NEW ZEALAND.

Press, Volume LVII, Issue 10738, 18 August 1900, Page 2

THE BANK OF NEW ZEALAND.

~Q- J ANNUAL MEETING.

THE CHAIRMAN'S SPEECH.

(PRESS ASSOCIATION T___GB_M.) WELLINGTON, August 17. The annual meeting of shareholder- of the Bank of New Zealand -was h_d to-day. Mr J. R. Blair, the Cl_arroa_ of Directors, reviewed the variations that had taken place the figures of the balance-sheet since the date of the previous balance-sheet. Referring to the increase of £753„379 in deposits, he said this was due almost entirely to the growth-of private-deposits, and was an evidence not-only of the general prosperity of tbe community, but also of the confidence that the community reposes in the bank as the custodian of its funds. It was more gratifying because the growth occurred at a thxte when enterprise and industry i throughout the whole colony was in all directions active and progressive. With re- j gard to London, all fixed deposits were being paid off as they matured, and no new deposits were being accepted. Discussing the assets side of the-statement. he said money at short call, etc., in Loudon showed an increase of £864,241, and there was also an increase of coin and bullion on hand. A larger holding of coin and bullion was necessitated by the increased volume of banks' deposits. Aa a consequence, mainly of ! th© same deposit, the growth of money at short call in London had increased, the bank's policy being to employ such funds in liquid advances in London where repayment could be obtained at very short notice if required. Rates for money in London having ruled higher during the last periods/the results to the bank had been almost as satisfactory from the profit point of view as if; the funds had been invested in the colonies, whilst the advantages under the world's existing uncertain financial outlook of holding ample resources in London available at short notice was obvious. Referring to the figures under the heading of "Investments in tho colonies," he explained that the decrease of £63,547 in other advances was small and unimportant compared with the volume of business transacted by the bank. Some shrinkage occurred through the gradual ingathering of old dependencies of an unsatisfactory or undesirable character. The Board made it a rule to pursue a generally conservative policy in regard to advances, j carefully selecting new business and gradui ally weeding out that which was undesirable j in the old. Though volume in advances had not increased the ordinary advances were j fairly well maintained, and' the quality was undoubtedly improving. There was a deI crease of £85,096 in the Bank of New Zeaj land Estates' Company assets in liquidation, j due to further heavy writings off from the profits to meet the deficiencies resulting on the realisation of the assets held in that category. A very large sum of £70,370 of j last year's profits was appropriated to that ; purpose. He could not say definitely when ; the limit of capacity of these assets in liquidation to absorb profits was likely to he I reached, but the outlook was clearing, and I the end was, he thought, fairly well in view. ! He announced that of the assets in this catej gory the last of those known as trading concerns bad now been disposed of. The | management expenses of the bank, in relaj tion to profit had been reduced by 6.92 per j cent. Viewing the situation as a whole, he ..thought shareholders were to be congratu- ! lated on the position to which the bank had i attained; the prospects were distinctly enj couraging, and he looked forward to the ! future hopefully. Speaking for himself and j colleagues, he said nothing would give them j greater pleasure than to be able to unfold J a silver lining to tbe cloud that so long ! overshadowed shareholders. He was sorry ' they could not on this occasion do more than point to its existence and bid them take courage. Ho might now safely say the, divi-dend-paving point waa coming within measurable distance. '-, ..Possibly in 1902 a dividend would be paid. Uncertainties attaching to any such forecast must, however, be borne in mind, and it must bo accepted ns subject to possible modification. He dealt at length with the whole position af- , fecting dividend paying, and pointed out how ; it was governed by the legislation of 1895. i Rv the forgeamnee of the Government, the I deficiencies of the Assets' Realisation Board could he provided for rtradnally as a surplus of banking profit would admit, while at the same time shareholders might be earning a small dividend. - In respect of the second call, the. Assets' Board appeared to be making'good progress with their liouidntion, \ the bulk of the estates in the South Island had been disposed of, and prospects in the i North Island appeared favourable for the • disposal of properties there to advantage. [ The work of rehabilitation was necessarily slow, and would take years to complete, but : there was no doubt it would be completed ■'satisfactorily within a reasonable period. \ Referring to the Rangiora embezzlement, he ii said, where practically the full staff of a small i branch combined to earrv on dishonest prac- :' tices, pecuflation might be safely carried on j for a long time. He wanted the public to :! understand that much might be done by the : | bank's own customers to prevent such occur:i ences by increasing the difficulty of carrying : | on dishonest practices. There would be fewer defections if the public would exercise greater care over their money matters and see they got proper acknowledgments from the bank officials. Temptation should not needlessly be thrown in the way of bank

officers. Mr Blair concluded by saying that there had been great expansion of trade in the colony and in the gold dredging industry, in the latter of which there wepe great dan- | gers, and he counselled people not to risk more than they could afford to lose. He moved the adoption of the report and balance-sheet. Mr Martin Kennedy seconded the motion, and.said he did not think the Chairman's anticipations coloured, and did nob think the earning power of tho bank had reached its limit. With x-egard Co the Rangiora incident, he thought rules could be drawn up that would prevent a recurrence of such a thing. Mr H. Beauchamp said the policy the directors were pursuing was a safe one, and that was why they had such a strong reserve in London in case of emergency. In reply to a question by Mi* Kebbell, who asked what amount would be required to make good the deficiency that ultimately arose from the realisation of the Estates' Company'- assets, Mr Blair said it was difficult to say, as the Board was entirely at the mercy of the market, but nrobablv between £30,000 and £40,000. He further said it was an entire misapprehension to say the bank business was decreasing. It had simply been weeding out bad business. The motion was carried, and a vote" of thanks accorded to the directors.