RECONSTRUCTION.

Dominion, Volume 2, Issue 557, 12 July 1909, Page 5

RECONSTRUCTION.

AUSTRALIAN JOINT STOCK BANK. (By Telegraph — Press Association -Copyright) Sydney, July 10. Tho Australian Joint Stock Bank directorate bas issued a ciicular to shareholders covering proposals for reconstruction. UNFORTUNATE SHAREHOLDERS. DETAILS OF SCHEME ' The scheme, as outlined in previous cablegrams, proposes that prcsont shareholders shall bo given ,£1 shares 111 the new concern against their uncalled liability of £2 lOs. per share. Arrangements aro' to bo made for holders and depositors of inscribed deposits to 'take up shares if they so desire. "B' deposits will receive 2s, 6d. in tho pound cash, 10s. lOd. in interminable inscribed stock, and 6a. Bd. in preferential shares. The now share capital of the bank will be £3,582,000, It is understood the reconstructed bank will bo called the Australian Bank of Commerce. Eefernng to the interests of shareholders and of depositors, and to the difficulty of the Bank's Board in finding an cquitablo adjust--1 ment, tho Sydney "Morning Herald" saysi "There are 155,700 6hares subscribed, most of 1 which aro paid up to £3 10b, only leaving I £2 10s. or £m,GS still to be called up. Were the bank to liquidate the shareholders Would have to find this sum or whatever portion of it they could, and the money so subscribed would be used toward-, tho liquidation of liabilities, the shareholders getting nothing in return. Besides tho shareholders whose position has, certainly been an unfortunate 0110, there are tho depositDis whose money has been for so long locked up. There are depositors who hold in«cribcd stock to the amount of £797,751, and depositors who hold deposits to the amount of 42,933,217. The former carry interest at the rnte of 3} per cent, and the latter at 3 per cent, and one half is repayable as already indicated on January 1, 1912, and the other, half on January 1, 1917. It rested nlth the board to orideavour if to rle>i*e -some scheme that fiou'.d ovenly hold the balance betueen each of these to some extent divergent interests For how far success has attended these efforts will be seen. "Last half-year tho A J.S Bank made a not profit of .£15,775. This, however, was after 3J per cent interest had been paid on the inscribed deposit stock, which absorbed .£l3 000, and 3 per cent, on the 'B' deposits, which absorbed £H,298, or £58,193 in all. Under tho proposed reconstruction scheme .£32,217 would bo required as interest on the interminable inscribed stock, and £7033 on tho special I fixed deposits, or £39,250 in all. Providing, 1 thereforo, tho same gross profits were made as was the ca'-o last year, £18,918 more *ould be available for shareholders, or £34,723 in all A dividend at tho rate of 3 per cent to the preference shareholders nould require £17,010 for the half-year. As.a matter of fact, however, the additional resources of the bank should enable it to earn more than in the past."