Concern At Bank Take-over

Press, Volume CIV, Issue 30930, 10 December 1965, Page 1

Concern At Bank Take-over

(N.Z. Preu Auoeiatlon>

WELLINGTON, December 9.

The Labour Party caucus claimed today that New Zealand’s financial position and direction of the economy was being placed in the hands of overseas financiers. A statement, released after today’s meeting of the Parliamentary Labour Party, said the caucus was particularly disturbed at the report that the National Bank of New Zealand was to be taken over by Lloyds Bank of London. “While the caucus recognises that only 15 per cent of the shares of this bank are now owned in New Zealand, nevertheless, the proposed take-over is one which indicates again the Government’s failure to appreciate the significance of some of the takeover bids which have been made in recent years,” it said.

The caucus expressed the view that if the shareholders of the National Bank were anxious to dispose of their shares, the Government itself should seriously contemplate acquiring the shares for the purpose of enabling the considerable profits of the bank to remain in New Zealand.

“If the Government Was the sole owner of the Bank of New Zealand and the National Bank, half of the profits made by the trading banks would not only remain in New Zealand*—but would accrue to : the whole people of New Zealand.

“it would appear the proposed acquisition by Lloyd’s of the National Bank has the fulL consent of the Government.

“It is most unlikely such a transaction would have been contemplated had the Gov-' ernment not indicated its acquiescence.” The caucus also expressed concern that the merger could have a prejudicial effect on the bank’s staff and deplored the fact that the proportion of New Zealandheld funds in the National

Bank had so seriously declined in recent years through the use of shares for the purchase of “so-called noremittance licences” for ears.

The caucus also discussed the proposal of the Bank of

New Zealand to fora, a finance company for the purpose of lending on hire-purchase and it decided to reaffirm its earlier policy that as the shares of the Bank of New Zealand were held by the Government, any subsidiary of the bank should be wholly Government-owned. “The Government's decision to permit the Bank of New Zealand to establish a subsidiary in which it has only a minority share-holding is thoroughly bad in principle,’* It was the caucus view that the whole of the necessary capital of the new company should be found by the bank and the Government ,

The caucus also opposed the National Party policy of increasing departmental house rents—specially where the ac-

commodation was provided as part of the inducement to retain staff in remote areas.

Labour considered the Government’s policy unjustified and unrealistic in light of the problem* associated with the staffing of essential services in isolated districts. “While recognising the Government’s right to determine ita own policy in this matter. Labour assures the electors that immediately on becoming the Government it will—after full discussion with the service organisations concerned —take steps to rebate rents which - have . been increased (based on the proposed formula) to a figure which will adequately compensate the tenant for such factors as isolation, and employment responsibilities/’ ,