A BANK'S DEBT.

Press, Volume LXV, Issue 19610, 4 May 1929, Page 16

A BANK'S DEBT.

TO A.M.P. SOCIETY. B€tlO OF FINANCIAL CRISIS. (i*c<* oo» »w» ci>aaa<ironr>«*T.' SYDNEY, April 25. Memor.es of Australia's gr«-«t financial eri»w in W»l *«« KCilled t0 ninny the other day when at the annual MMtiog of the AMP. Society Mr B. J J>arkin«oa, of Melbourne, .Imeteu tho attention of the policy holders and the directors to the fact that the haglish, BeottUa and Australian Bank owed the Society £30,000. it ra explained by Mr Parkinson that tin* amount waa on deposit when the bank failed in the early -nineties. The creditors of the hank had agreed t« a reconduction in 1893, by which they were to receive 4i per cent, on their debt, converted into mock, and to a further reconstruction in 189<>, by which the interest was reduced to 3 per rout. Since that time, the bank has K«wn and flourished. However, according to Mr Parkinson, it refused to accept the view that the depositors —of whom tho society was one—were entitled to a refund of their deposits in full. The present shareholders of the bank were receiving Hi per cent., but tho society, as the holder of the 18t>ti stock, was getting only 3 per cent, on its £50,000, winch meant that the asset was worth only one quarter of what it was originally. Mr Parkinson said that he was aware that various efforts had been made to compel the bank to honour what was believed to be its obligations, and that these hud failed, and that the Federal Attorney General had said that there was no redress for the old depositors. He pointed out, however, that a condition of tho 1896 reconstruction was that "£15,000 was to be put into a special reserve to support these stocks," and that "this reserve was in no circumstances to become the property of tho shareholders." That £15,000 had now (frown into a fund worth £500,000, and he argued that, as it clearly was not tho property of the shareholders, it belonged to those depositor* who agreed to accept the 1806 stock; and that they should be repaid from this fund. He urged that the opinion of counsel should be secured, and the necessary steps taken to compel the bunk to pay. The chairman of the society (Sir Alfred Meeks) said that there seemed to bo no redresn. The value of the stock was not shown at its face valae —it had long since been written down to it* aetnal value. Ho wove-, the board would give tho matter further consideration, and opportunity would be taken to make representations direct to the bank in London in regard to the principle involved.