PROSPEROUS YEAR

Dominion, Volume 21, Issue 188, 11 May 1928, Page 15

PROSPEROUS YEAR

MUTUAL LIFE AND CITIZENS’ ASSURANCE

The forty-first annual meeting of The Mutual Life and Citizens’ Assurance Company, Limited, was held on April 20. The Hon. James Ashton, M.L.C., who presided, in moving the adoption of the annual report said :— The Late Sir John Garvan: Since shareholders last met, Sir John Garvan has passed from our midst. At the age of 23, succeeding liis father. Sir John assumed control of the company's business. From that time until the outbreak of war. all his thoughts and energies were dedicated to the interests of the company. During the war, and for years after, he no less exclusively applied himself to the problems of war finance in their varying phases. As a member of the Note Issue Board, and as chairman of the Commonwealth Bank of Australia, lie was the trusted adviser of Ministers. His service in that field of work was appropirately acknowledged and recognised by those who were ill the best position to judge of its quality. <>f his elmracteristics as a man, and of his abilities in the field of life assurance, there is little need to speak here. He possessed unusual intellectual powers, high, courage, and great tenacity of purpose, which enabled him in the early days of the company’s history to face and surmount; difficulties that, would have daunted most: men. The highest tribute to his capacity, perhaps, is to be found in the history of flic company, whose destinies he so long controlled, and in its position as disclosed in the statement of accounts now before you. “If you seek a monument, look around.” To the relatives of Sir John Garvan the board immediately upon his death conveyed their sense of his loss as a leader and colleague. The adoption of this report will be accepted by the members of his family as an assurance that the feelings already expressed by his colleagues on the board are shared in full measure by the geenral body of shareholders. New Managing Director. During the years that Sir John Garvan devoted himself almost entirely to public service, he deputed the executive management of the company to Mr. A. M. Eedy, who for 28 years held the post of general secretary. Growing up in the company’s service with the late Sir John Garvan, his heart as well as his interests have always been centred in the company’s affairs. As has already been observed at a meeting of the board: — “It is often a matter of difficulty and anxiety for boards of directors in similar cases to find a suitable man to fill so important a post, especially in succession to a man who had set such a high standard as our late chief, In the present case, they were faced with no such anxiety, for they had in Mr. Eedy a man whose proved ability, close association with Sir John Garvan, and long experience in the company’s affairs, inspired the directors with complete confidence.” To this may be added that in view of the extent to which Mr. Eedy directed the affairs of the company during. the years that Sir John Garvan applied himself to the problems of public finance, the appointment of Mr. Eedy as managing director followed as a matter of course. So well are Mr. Eedy’s qualities known to shareholders generally that it seems almost superfluous to say that in the opinion of the board the direction of the company’s affairs could not be in safer or more capable hands. Mr- Eedy has the able and loyal support of Mr. W. J. Bloomfield, who, after nearly 36 years’ service in the company, has succeeded to the position of general secretary, as well as that of a higjilyqualified staff of experts. Results for 1927. Passing to a review of the last year’s operations, it may be said that the characteristics which have marked the company’s history from its inception are reflected as clearly as ever in the report which we present to-day. Increasefl new business, reduced expense rates, larger interest earnings, additional reserves and greater profits, are the salient features of the year’s work. In the s ordinary branch, the new business was £3,559,507, which is the company’s highrwater mark; the increase in premium income was £32,584, one of the largest in its history. In the industrial branchy the growth in premium income—£33,7B7 — has been exceeded on only two occasions. In the accident branch the increase was £9851. TJie ratios to premium income of the expenses charged to the ordinary and the industrial branches show still further reductions over those of the very low rates of the previous year. The addition to the funds was £618,489, and the effective rates of interest earned are the highest the company has yet registered. Since Sepfeinber, 1025, we have issued with-profit Industrial Branch policies in Australia and New Zealand on the model which Ijas proved so successful in the Ordinary Branch, and the increased flow of new business justifies the innovation. Milestones of Progress. We have been the pioneers in setting up the must stringent reserves for wilh-protit policies, and in the year under review we have valued the policy liabilities of the with-profit section of the Indust ria) Branch at 3 per cent, instead of 31 per cent, as hitherto, and have provided the additional money required therefor. The action of the company in thus further strengthening reserves is not a new feature of its policy, but merely U continuation of its traditions. It was at tile close of 1895 (the company was then only nine years in existence) that we decided on a 31 per cent, net premium valuation for Ordinary Branch contracts. In 1902, the rate assumed was reduced to 3 per cent. In 1914, we established a net premium valuation in the Industrial the position of that branch by fixing Branch, and in 1924 further solidified the interest rate at 3J per cent. These achievements are milestones in the company’s progress.

Strong Reserves and Liquid Assets.

The general reserve stood at the beginning of the war at £lOO,OOO. This was drawn upon to the extent of £32,000 to refund to soldiers or their representatives all war charges made in connection with their policies. The reserve has now been re-established at its former figure, £100,000._ Of our assets of £18,567,527, 85.25 per cent, are represented by public securities—Government and municipal —and 6.63 per cent, by loans on policies. Upon our mortgage loans no interest was outstanding at the end of the year. Striking Average Daily Figures. It will be of interest to mention that during the year the company received on each working day an aver-

age amount of £6143 in premiums, and £3216 in interest; on each working day the company paid an average amount of £6143 in premiums, and £3216 in interest; on each working day the company paid an average amount of £4983 in claims, and invested an average amount of £10,920. As bearing on the operations of the company, it is of interest to qubte the considered judgment of the trustees for the policyholders, who in their report say : — “The trustees note with pleasure the increase of £32,31S in the general reserve, which now stands at £100,000: the highly satisfactory interest rate yielded by the funds; which are invested in securities of the highest grade; and the economical manage-' meat evidenced by the low expense rate charged. They congratulate the policyholders on the results of the most prosperous year the company has experienced.” Mr. Janies Kell seconded the motion, which was carried unanimously. A vote of thanks to the directors, trustees and staff, proposed by Mr. Sydney Evans, and to the chairman, proposed by Mr. Charles Binnie, terminated the proceedings.—(Published by Arrangement.)