Page 4 Advertisements Column 2

Clutha Leader, Volume I, Issue 44, 13 May 1875, Page 4

New Advertisement. "— »—— —^— — ■ °— — —^—^— ■— — is that, notwithstanding the initiation of a policy by other banks, on which I will remark hereafter, which is calculated to interfere materially with backing profits, we are enabled to meet you with the same dividend and bonus, and to add something to the balance to be carried forward to the next hall-year. In view of the possibility of the continuation of the competition now existing, the directors consider it prudent to keep a good balance in baud, which may possibly be needed in the future to equalise dividends. The policy to which I have referred, and with which most of you are no doubt more or less acquainted, was the offer by the National Bank of New Zealand of rates for deposits much in excess of those previously current, which were of course adopted by the other banks, and subsequently were increased by the Bank of Australasia. Previously to this step being taken the banks acted in concert as to rates but, on the pretext of forcing us to join in a general agreement in Australia, the bank I have last named withdrew from, and consequently upset the agreement in the colony. On first sight it may appear as if their position was not unreasonable, but when I tell you that our business in Australia consists almost wholly of our own agency business and dealing in exchange, it will be at once apparent to you tbat to join in tbe same agreement as the other banks have for general business would practically be consenting to close our Australian branches. As there appeared no prospect of a return to an agreement here, there was nothing for it but to carry the war into our adversary's stronghold 5 but before doing so a renewed ! attempt was made to bring about an under standing, but without suecess. We therefore offered in Melbourne the same rates as were being publicly offered here by other banks, and though this action has been severely and very unjustly commented on by some portion of the Australian Pres?, you may take our assurance that it is not working, or likely to work, to the disadvantage of this bank. I need scarcely tell you that the offer of the present extreme , rates for money is altogether foreign to the ! policy we would desire to adopt, and I am sure subversive ofthe best interests of the colony ; for, though it gives depositors a present advantage, it withdraws money from the ordinary channels of business and inevitably leads to correspondingly high rates for advances. This has not yet been much felt, the competition between the banks keeping down lending rates ; but i the time will come when the banks will , try to make up for the present low scale of profits; and I hope the commercial community will then remember that the pinch has not been caused by this bank. The figures in the balance- Bheet require little ; comment from me. They prove satis- ; factorily that the business of the bank is being well maintained ;. and before sitting . down I will only add that, in consequence of high prices for wool and a most abundant barvest, the trade of the colony is in a very buoyant condition, and the late successful negotiation of a further loan by the Colonial Treasurer gives assurance that his [ scheme of public works will continue to be vigorously prosecuted. I have pleasure in moving that the report and balance sheet as read be adopted. Dr J. L. Campbell seconded the motion, 1 which was carried nem con. Mr -F.-L.' Prime asked the following question:— ln recent letters in the Aus- < -i tralian^ess on the 'subjlct of high rates of , interest offered by this bank, I ot serve we are accused of attempting to attract . Australian capital to New Zealand. May j I ask if this is one of the objects in view ? Mr D. L. Murdoch, Inspector, in reply to the. question, said r— " ln the recent i action taken by the bank m Australia, no such object as that which has been referred ': to by Mr Prime in any way influenced the : directors of this bank. It was simply a desire on their part to attempt to bring 1 abarit a better understanding between the 1 banks there, by eonvineing them that we were in as good a^ position to make them pay for deposits tn Australia as they were to make us pay hero. As to the accusation respecting the wish to" attract capital to New Zealand, I think we might very well retort the accusation against them as being 1 the primary cause of the recent competition i which has sprung up, and say it was a ! desire on the part of the foreign banks to i attract a portion of the capital now in use in New -Zealand to Australia; for the ; representative of one of the foreign banks which took the first action in this competition publicly stated tbat he had instructions to withdraw L2OO 000 of capital which his bank had in use in the colony. He could only do that by either squer z : ng ; bis customers or getting deposits. He did . not care to do the former, and he de- ! termined on the latter policy. Now, if we had allowed him to withdraw L200.000 in that manner, the effect would be it : would have lessened by. so much tbe power ' of the oiher banks te grant accommodation r to their customers. This, I inay here state, is one of the inconveniences that a colony is exposed to in dealing with foreign institutions— one day expanding and the next contracting their business, not perhaps from any local cause, bnt simply from the necessity they may stand in other quarters. I think that New Zealand has previously experienced this, and this would only be a ' repetition of what had happened 1 before. But the accusation referred to is only one of many that I have seen in print. Another one that I saw was that we ' were squeezing our customers/ But I fancy, that the 1 shareholders and customers of this bank \ are themselves better judges upon: this' point than scribblers in newspapers^ feaap ; sure tbat no one will sayrtfotrisiy reasonable accommodation has: been refused! by 1 the Bank of New Zealand to any one in the colony deserving it. I fe^ suirfrthat the shareholders ana customers generally, lif they see such reports in prhit; will tf eat i them with the contempt which they deserve, > and look upon .them as - : weak mventions of the enemy. '(Hear, hear.) ■-'"■ \ •«,• Mr Cherry asked : With respect tb the agency or branch in Sydney, I underwood, when ithe increase of J capital' was voted, : thereyivas a question 1 as' to whether we were going into buaineao in the oth4r colonies. :l> understood the diifeetott to MA\^z,mttftimsA^-miS^ I "WfMd^wJ aek wheth« theSydi^fcTand^iaa J gtfnwal , banking vbßp^«^swlitlto^fe^%^ . agency of tins office? ' . -ya yjr* • business ; they arc accessories to the bant