PROFITS INCREASE

Dominion, Volume 31, Issue 54, 27 November 1937, Page 12

PROFITS INCREASE

Bank Of New South Wales EVIDENCE OF RECOVERY President Reviews Accounts Au increase of £72,788 in net profit is shown in the accounts of the Bank of New South Wales for the year ended September 30. 1937. The distribution for Hie year was 24/- per share, equivalent to 6 per cent., as against 5} per.cent. for the previous 12 months. In their report presented and adopted at Hie 'annual meeting in Sydney yesterday, Hie directors state that the net profits for tlie year, after deducting rebate on current bills, interest on deposits, and paying income, land and other taxes, reducing valuation of bank premises, providing for bad and doubtful debts, fluctuations in the value of investment securities, and other contingencies, and including recoveries from debts previously written off as bad, amount to £543,242/0/6; to which is added undivided balance from September 30, 1936, £129,499/17/2, making a total of £672,741/17/8. Interim dividend at the rate of 6/per share Australian currency for quarters ended December 31, 1936, March 31 and June 30, 1937, paid out of the year’s profits, in terms of clause 105 of deed of settlement, absorbed £395,100, leaving a balance of £277,641 17/8. This the directors recommend to be dealt with as follows: To quarter’s dividend to September 30, 1937, at the rate of 6/- per share Australian currency, £131,700; to balance carried forward, £145,941/17/8. The quarterly dividend is payable at head office, Sydney, to-day and at the branches on receipt of advice. The branches and agencies of the Bank of New South Wales now number 850. During the year 2.1 new branches were opened and 12 agencies converted into branches.

meeting yesterday, Sir Thomas Buckland, president of the bank, said the total of the balance-sheet this year had reached the high figure of £123,145,000, an increase of £7,900,000 on the figures of 12 months ago. “It can be considered an eloquent testimony of tlie recovery which has continued its progress in the countries we serve and also of the enthusiasm ami efficiency of the staff of the bank throughout all grades.”

Deposits now stood a[ £95,876,000, some £6,730,000 higher than last year. This grbwtli was largely the outcome of tlie better prices customers had received for their products. The year had also been free of any serious setback in the shape of a general drought, although individual districts had suffered some of them seriously. Bills payable £8,322,000 were £1,182,000 higher than a year ago, the result of increasing trade and a general improvement throughout the community. Capital £8,780,000 and reserve fund £6,150,000 remained the same as a year ago.

On the assets side, said the president, cash items, which stood this year at £16,646,000, were some £5,371,000 higher than at last review. “In accordance witli banking prudence and in co-operation witli the policy of the central bank, our figures show that we have used the improvement to increase the strength and liquidity of our position. It is almost unnecessary for me to remind you of the efforts this bank put forth in the years of 'difficult}' and stress to assist both its own customers and tlie community at large. As that, was the proper policy for those dark days, so is it essential that we should take the first years of prosperous conditions to gain that position of liquidity and strength that would enable us to face with certainty and calm a depression even of the severity of that recently past. I am glad to inform you that the attainment of this great objective is in sight.”

Funds at short call in London were some £600,000 higher at £2,070,000. Treasury bills standing at £2,630,000 were £4,645,000 less than a year ago, due to the withdrawal of Treasury bills from this bank by the central bank. Investments in Government securities were £1,270,000 higher at £5,159,000. Bills receivable and remittances in transit. £7,960.000 wore £600.000 higher than a year ago. This was further evidence of increased trade, but its value as an indicator was affected very largely by the time at which the export season opened. Growth of Business.

“It is interesting to point out,” said Sir Thomas Buckland, “that of the increase of £6,700.000 in deposits, some £3,600.000 have been retained, spread among casli and other more or less liquid items, and our loans and advances have grown by £3,980,000 to a total of £80,570,000. This increase is the result of a much greater growth of business than would be revealed by a mere comparison of the balancesheets for this and previous years. Improving conditions have enabled a very large proportion of our customers to lean less heavily upon the bank, creating a tendency for advances to decrease. The growth in our figures, therefore, while giving evidence of the careful policy being pursued by tlie bank, is a most encouraging evidence of an active and growing business.” This rate of growth had forced upon them tlie necessity of providing room for tlie expansion of many of the bank’s branches, particularly the larger ones. The president, after outlining the extensions of tlie bank's premises in respect of several large Sydney branches, said the increase of £300,00(1 in the amount standing against bank premises, £2,900.000, represented the outlay on these new premises less the proportion which it was found desirable to write off year by yea r.

Contingent liabilities stood at £3,650.000. a small increase on last year. This item represented tlie total of obligations undertaken by the bank on behalf of its customers.

Following is a comparison of the Bank’s results for the last three years: 19.35. 1936. 1937. £ £ Not profit 4 12,661 -170,454 513,242 Brought forward 116,335 119,996 129,500 558,996 590,150 072,742 Dividend — Rate 5 p.c. at p.c. 6 p.c. Amount .... 439,000 460,950 526,800 Carried forward 319,996 129,500 115,942 A Year of Progress, In his review of the accounts ► at the