Bills dealer assisted by diversification

Press, Volume CXI, Issue 32561, 22 March 1971, Page 20

Bills dealer assisted by diversification

(N.Z.P.A.-Reuter—Copyright) AUCKLAND, March 21. The conservative attitude adopted in the building-up of the commercial bills and company markets in New Zealand should ensure that unsound practices such as those recently revealed in Australia would not occur here, said Mr R. King, chairman of Security Dealers, Ltd, Auckland short-term money market dealer, in his annual report for the year to October 31.

The company had diversified strongly into the commercial bills and intercompany markets, in the face of serious problems in the public security markets. The excellent performance of the group in the latest year was largely because of the operation of the holding company, which had extensive business dealing in securities, mainly in the public sector. The group boosted profit from $225,092 to $390,058 and lifted its dividend from 10 per cent to 12J per cent. However, dealing in public sector- securities, which had been the mainstay of the group’s activities, was gradually running down. In the last annual report, Mr King expressed dissatisfaction with the method used to introduce Treasury bills. He said the original inadequate situation had been worsened by further modifications, which had farreaching effects on the Government securities market. In the last year the free market

in these securities had been severely depleted, he said.

New Zealand was well out of step with the developed economies, in which the Government securities market normally played an important role. The directors hoped that the diversification into the private sector markets would lead to a situation in which a consistently good return could be secured by off-set-ting the periodic depression in the public sector markets against increasing returns from the private sector.

Issues, Calls Pending Comalco.—Final call of 135 c, payable .. Mar. 31 ; Mineral Resources.— ; Public dotation of 2.5 m 20c shares. Details later. Dunlop N.Z.—l:6 issue of 580,000 100 c shares at 225 c; ex rights .. Mar. 23 Sthn Cross.—Call of 4c on 4c pd ctg shares, payable .. Apr. 15 Swift N.Z. Issue of 900,000 100 c shares at 125 c. C'bury Roller. 1:5 issue. Details later. A. and l:tf issue of 100 c shares at par. ex rights .. Apr. 1 N.Z. Steel.—l:s issue of 100 c shares at par; ex rights .. .. Mar. 26