BASK OF NEW ZEALAND.

Evening Star, Issue 11677, 8 February 1902, Page 8

BASK OF NEW ZEALAND.

A DIVIDEND FORESHADOWED. [Special to the Star.] WELLINGTON, February 8. The Chairman of the Bank of New Zealand (Mr Malet). in the coarse of his speech at the half-yenrly meeting of the propraetors yesterday, said the accounts of the Bank are made up for publication onoe a year onlv, but the position of the Bank is carefullv reviewed at the September balance. A balance-sheet is taken as out on the 30th of that- month, and is of use, if for no other purpose than to give the authorities of the institution a clear idea as to how the business is being maintained. Such periodical investigations are of the greatest advantage even though the results may not be given to the public, I oan, however, say without hesitation, that, compared with the figures of the corresponding period twelve months back, there is a very satisfactory increase in the volume of business, and I may tell you, what to you as shareholders will le of particular interest, that the profits for the half-year have been fully maintained. There is no reason to suppose that the current half-year will prove less satisfactory, though in the matter of deposits it is only reasonable that with less money coming into the country by reason of the low price of some of tie chief products of the colony, current accounts in the aggregate may. not show as well as at March last. However, it is waste of time to indulge in prophesy as to the future. At the annual meeting the actual figures will bo laid before you. The abnormal condition of the wool market is a mailer for serious consideration, and it behoves the Bank to carry on its business with caution. The industries of the colony, however, are varied, and consequently. Tie colonists do not carry all their eggs in one or two baskets. It is rarely that all the products of the colony are depressed atone and the same time. When one industry is depressed some other important e is the reverse, as, for instance, the dairy industry. While undoubtedly the colony must fed the present condition owing te the price of wool, the clients of the Bank are in a better position to withstand the depression of the wool market than they were years back. They have experienced a few years of prosperity, and have lo doubt profited by the experience gained in the past. Moreover, the reduced value '( money has been in their favor. I have referred particularly to the present condition of the wool industry, as it is one cf the staple products of the colony, and te !Haok« tsbrongb its large constituency is entrusted with the disposal of a very considerable proportion of this valuable item in the exports of the colony. Mr Martin Kennedy, who was re-elected a director without opposition, said that whilst it was true that an election should depend upon the whole of the shareholders in Australia, England, and in New Zealand, it virtually rested with the shareholders residing hi Wellington or visiting Wellington at the time of the meeting: and in view of future legislation, or tee legislation that was likely to take place, they were told, within the next year or two, affecting the Bank, he thought that, from his experience, he ought to point out (with a view perhaps of getting it remedied) that this, in his opinion, was an anomaly. They would see that this restriction was bs special legislation, and it was a question for them to consider and for the Legislature to consider presently, whether that restriction was judicious and in the rightdirection. Its ostensible object was to prevent officers of the Bank and directors for the time being from arming themselves witn proxies; but if the directors did not get the proxies their opponents got them. Somebody must get them. lie himself thought at one time that he would not circularise the shareholders, but, however, he did so, with the result that 500 proxies came to him—more than half from England, and a good share from Australia. What was he to do with them? He did not ask the Wellington shareholders to give him. proxies, but he intimated later on that he would ask them to hold proxies. Having got 300 of these, he depended upon that. But his opponent, who did nob get fifty proxies, yet got the votes. He (Mr Kennedy) would not hold the proxies, and this disfranchised the shareholders at a distance. The suggestion he would make was one merely for the consideration of shareholders and for the consideration of the Legislature. He would suggest that if it were desired to make a restriction on tie ordinary way of voting, it should be done in a manner similar to that of the AMT. Society by voting through the Post Office. Then each man. instead of sending his vote as at present, would exercise it through the Post Office. This would fc more satisfactory to the candidate and to the persons exercising the proxies.—HHear, hear.) At the present meeting no figures were put before the shareholders. And what, he asked, was the good of meeting merely to see that ...o election took place. However, the position must remain, as it was until the legislation took place, bat legislation was likely to take place soon. With the 300 proxies ke had received -~ere were forty or fifty letters written to him. Some of the shsreholders writing were naturally anxious to know what was to happen in the future, and wanted advice—advice which a director could not- very well give, whatever he might think. Some of them had bought shares at £2O and £2O odd, and wanted to know whether they were warranted in buying more. 'Hus was advice which he could not give. Ho mentioned this because he had not answered these letters, and he hoped the gentlemen writing them would accept this as the answer, and the only answer, t-e could‘rive them. It would be imprudent for one° in the position of a director to give advice, and he must decline to give it. Some, again, wanted to know what prospects were for the future, and whether there was to be a dividend. Some thought the prospect* disclosed were such that there ought to be a dividend. Some of them stated that they were living on an income, that they had strained themselves badly in paying the last- call, and hoped that a dividend would be paid before they passed away to another world, and so oru —(Laughter.) He could only answer by quoting the Act under which the Board were ruled. The Act- stated that the profits should be devoted in the first place in payment rl a fixed cumulative sum of £50,000 per annum, which shall be transferred and jail to the Assets Board. In the next place, the Bank “ shall have paid all instalments then due of a call directed to be made under section 9 hereof of a dividend not exceeding 5 per cent, per annum on ihe amounts for the time being paid up by them .'n respect of such call, and the residue (if any) of such balance shall be paid to the Assets Board.” This was the law at the present time, and it was under tkwe tooditiens that they were to administer the surplus profits of the Bank. In answer, therefire, to the numerous queries he had received as to whether a dividend would be paid next time, he could only quote the words of the Act, and say that if money had been doe merely ca debentures or borrow ed in the ordinary course there would be a. dividend; that the Bank’s affairs were clean, and written down suificientlv; and that there would be that surplus of profits which would warrant them in paying a drvi dend. —(Hear, hear.) There were two directors representing the shareholders, and four, as they knew, nominated hy the Government of the day. There was no division at all in the ordinary administration or affairs between these direceora, and the general consensus of opinion of tho whole Board, including the auditor, was that there were sufficient profits to pay the dividend. unless ulterior circumstances should force the hands of the Government, This was the position, and it would not be rignfc for him to say whether there would be a dividend. He believed that there would he a dividend, but this was his own individual opinion, and was non-committal. However, aa representing the shareholders, and taking the earnings of the Bank for the current year, he would say that whether the money hod been guaranteed by the Government, or had come from debenfemes in London he would be free to act, and as far as bis judgment went he would cast his vote in favsr of a dividend. Speaking of the change in the chairmanship, Mr Kennedy congratulated Mr Malet on his new position, and said he was satisfied that the inBank,,did.«ot sirfler ; i)y th 6

change in the chairmanship. If a Premier went out of office his Ministry fell, but when the chairman of this institution resigned has office there was no fear of any consequences. Whatever the business of the Bank, it went on in just the same way. and with the same assurance as if the late chairman had been there. He could give his assurance from his personal knowledge that there would be no ill consequences to the Bank by reason of the change in the chairmanship.—(Hear, hear.) In answer to Dr Newman, who asked whether the chairman could tell the meeting who the new directors would be, Mr Malet said that the Hoard of Directors had not yet received any notification from the Government. Replying to Mr Sharp, of Nelson, the chairman said that the Hoard had received a rotitication from the Government that Mr Blair had tendered his resignation to the Government. Beyond that the Board of Directors knew nothing.