Fierce competitor for funds

Press, 11 December 1976, Page 1

Fierce competitor for funds

Securitibank was established in 1966, and has a paid-up capital of S2M. Of this shareholding, almost 86 per cent is held by major institutions. Besides Mr Rutherfurd, Securitibank’s board consists of Messrs J. G. Russell (managing director), D. L. Bullock, R. D. Cox, J. K. Skinner. R. S. V. Simpson and W. G. Anderson.

Other companies given as subsidiaries of the group in addition to Merbank and Commercial Bills are Short-term Deposits. Ltd; Secured Deposits, Ltd; Safe Custody Nominees, Ltd; Mortgage Management, Ltd. and Securitibank Securities, Ltd.

In the money market, Securitibank has been a fierce competitor for funds, offering much more than the rival merchant banks have on commercial “paper." It is believed that attempts were made this vear to have Citibank, of New York, acquire 49 per cent of Securitibank’s capital, but this injection of foreign capital has not eventuated. . The bank’s managing director, Mr John Russell, is well known throughout New Zealand as an afterdinner speaker with an uncompromising view of finance and work. Earlier this vear in Christchurch, he advocated — to a group of management people — an Increase in unemployment to 2 per cent, or four times the present level. In the last few months, Securitibank has mounted an expensive national advertising campaign which has described its employers

as “a team of expert money managers.” The group has spent about $60,000 in the last three months on advertising in the press and on television.

The newspaper advertisement has shown two men wearing badges on their lapels. The headline has said: “The men wearing this badge belong to a team of expert money managers.”

Wearing the badge, says the advertisement, means that they will talk finance any time. “That means they know the sound of fruitful investment of money. Either a thousand, a couple of thousand, or up to hundreds of thousands.”

Last evening’s statement bv Mr Rutherfurd came after a meeting of the directors, which began in the morning. A spokesman said that the directors would be occupied most of the weekend on the group’s affairs. The closing of Securitibank’s offices took a number of its clients and other callers by surprise. Some visited the offices after, failing to get response to telephone calls. In Christchurch, some staff stayed at the office to answer calls from investors until being ordered to close officially for the day. A spokesman for the New Zealand Bankers’ Association said yesterday that Securitibank was not a trading bank.

The Reserve Bank Act, 1964. says that a bank is an institute as listed in the schedule to the Reserve Bank Act, the names of the five trading banks being listed. They are the Australia and New Zea-

land Banking Group, Ltd (A.N.Z.); the Commerical Bank of Australia, Ltd; the Bank of New Zealand; the National Bank of New Zealand, Ltd; and the Bank of New South Wales.

The activities of merchant banks are basically different from those of trading banks. There is no need for concern by depositors in trading banks.

At April 26, Securitibank’s S2M share capital was held by the following: John Keith Skinner and John Murray Sidey, Dunedin sharebrokers, 25,000 shares; B. W. R. Nominees, Ltd, nominee company of Buttle, Wilson, Rutherfurd and Company, Auckland sharebrokers, 10,000 shares; Butland Industries, Ltd, Auckland, 212,796 shares; the Government Insurance Commissioner, 354,146 shares; the National Insurance Company, Ltd, 200,501 shares; the New Zealand Insurance Company, Ltd, 39,264 shares; the Norwich Union Life Insurance Society, 123,150 shares; the Provident Life Assurance Company. Ltd, 300,000 shares; the Prudential Assurance Company, Ltd, 170,667 shares; the South British Insurance Company, 250,000 shares; the State Insurance general manager, 102.068 shares; the AA Mutual Insurance Company, 98,102 shares; Rothmans Industries, Ltd, 94,306 shares; Robert Donald Cox, Auckland chartered accountant, 5000 shares; Robert King, Auckland, 2500 shares; Richard Spence Volkmann Simpson, senior partner in

Bell, Gully and Company, Wellington barristers and solicitors, 3500 shares; John Campbell Bates, Auckland, 5000 shares; Douglas Littleton Bullock, Auckland, 1000 shares; Forbar Nominees, Ltd, nominee company of Forsyth, Barr, and Company, Dunedin sharebrokers, 2000; and Walter Gouinlock Anderson, Lower Hutt, 1000 shares. The New Zealand Insurance Company reduced its holding by 85,736 in the year to April 26.