BANK OF NEW ZEALAND

Evening Star, Issue 22363, 12 June 1936, Page 7

BANK OF NEW ZEALAND

THE ANNUAL MEETING REVIEW OF THE YEAR LOSS OF DAIRY PRODUCE HANDLING The anunnl meeting of the proprietors of the Hank of New Zealand was held at Wellington to-day, when Sir George Elliot, chairman of directors, reviewed the hank's year, making, of course, special references to the eliect of the non- Government's measures upon the trading banks. For instance (he said) they arc to lose from August 1 next the handling of the exports of dairy >. produce, and should wool and moat come under the Government's guaranteed price and marketing scheme, the effect would be that the banks would be entirely deprived of the normal means of replenishment of their London funds and would have |to purchase all their exchange requirements from the Reserve Bank of New Zealand. I need hardly say that the Government’s proposals in this direction will seriously affect an important branch of the trading banks’ business, a business they have developed and carried on since the earliest days of banking in New Zealand. BANK’S BUSINESS. During the year under review (Sir George said) the total amount of our notes presented for payment was £179,326. the amount of unpresented notes at March 31 being £324,452. In compliance with the terms of the Reserve Bank of New Zealand Act, 1933, the face value of our notes outstanding on August 1 next will be paid over to the Reserve Bank. Deposits, £35,740,430, are higher by £2,541,817 than a year ago, the greater part of this increase being in current accounts. • Coin, Reserve Bank Notes, and deposits with bankers stand at £6,913,141. Money at call and short notice, Government securities and other securities in London are £5,172,420 —an increase of £586,952. Bills receivable in London and in transit show an increase of £799,333, which is mainly accounted for by larger shipments of wool and the higher prices ruling. New Zealand Government securities (£3,397,058) show an increase of £249,386. Australian Government securities are less by £264,326. Advances and bills discounted, etc. (£22,179,373) are more by £688,642 than a year ago. THE DIVIDEND. f An interini dividend of 5 per cent, on ordinary shares was paid in December last. A further 5 per cent, is now being paid, making 10 per cent, for the year. The dividend on all classes of shares will be payable in Wellington to-morrow and at branches on receipt of advice. The dividends which the various classes of shares will have received for the year will be:—A preference, 10 per cent. ; O long-term mortgage, 6 per cent.; D. long-term mortgage, 7* per cent.; B preference, 7.27 per cent.; ordinary, 10 per cent. DAIRY PRODUCE FINANCE. After reference to the services of the Board of Directors and staff, Sir George Elliot reviewed the terms of the Primary Products Marketing Act, concluding: The trading banks have played an important part in financing and developing the dairy industry from the inception of the 00-operative scheme in New Zealand, and it is not too much to say that but for the assistance given by the banks the dairy factories as a would not be in the flourishing position they are to-day. In view of the services rendered to the dairy industry, it is to be regretted that the Government, in framing its proposals, has decided to take away from the trading banks an important portion of dairy produce finance which in the past has been handled by them with the utmost satisfaction to all parties. The loss of the London exchange in connection with exports of this produce will make unprofitable the working of some of our branches, the existence of which has only been justified because of dairy factory connections. TRADING.AND BANKING FIGURES. The trade figures disclose a sound position (continued the chairman). The values of both exports and imports are higher by approximately £4,000,000, the excess of exports—viz., £9,828,000 —being sufficient to meet all overseas interest commit men ts. The average total trading hank deposits for the March quarter amounted to £65,599,000, an increase of approximately £4,500,000 as compared with the March quarter of the previous year. Free deposits account for £3,229,000 of this increase. Advances show an increase of £2,028,000 for the same period. The total trading banks’ balances with the Reserve Bank at March 30 amounted to £8,937,618, or, say, £5,600,000 in excess of the statutory balance required to bo deposited. In addition, they held in London assets in connection with their New Zealand business aggregating the sum of £14,143,'369 (N.Z.). The trading banks are (therefore in a position to materially extend their lending operations in New Zealand. The London funds of the Reserve Bank of New Zealand and the funds of the trading bank's held in London relative to their New Zealand business, together amount to over £38.000.000 in New Zealand currency —a position of considerable strength. DAIRY PRODUCE. The prices received for the season’s production of butter • and cheese, although slightly in advance of those of the previous year, have been again disappointing to dairy farmers. The average price;; received this year are, approximately 92s per cwt for butter and 51s jior cwt for cheese, against 80s and 48s respectively last year. The peak price—viz., 128 s per cwt for Now Zealand butter in London—was reached in October last. This increase in price was duo to decreased production in Now Zealand owing to dry conditions in early spring, lower production in Australia about the same period, short supplies of Australian and New Zealand blitter in London during-October, and anticipation of the effect of a proposed agreement between Germany and Denmark which would probably be tbc means of diverting a portion of the Danish output from England to Germany It is estimated that by the end of the production year the quantity of butter manufactured will show an increase of, approximately, 7 per cent., while the production of cheese will have decreased by, approximately, 6 per cent.

WOOL. During the second half of last year an upward movement in prices took place, due principally to the prosperity in the Homo trade, which experienced a notable improvement .in exports. Available supplies were readily absorbed at firm values. The outlook for the Dominion wool sales, which commenced in November, was greatly improved. The opening sales showed that values had appreciated materially. As the sales progressed, a further improvement in prices was recorded, and the market remained fairly stable throughout the season. The total number of bales sold at the Dominion sales for the 1935-36 season was 737,454, which included a considerable amount of wool carried over from the previous season. The sum realised was £9,840,427 —an increase of £5,439,417 over the return of last year when 471,512 bales wore sold. The average value per bale and per pound of the wool sold at the Dominion sales the last two seasons was ns follows:—l934-35, £9 Gs 8d per bale; 1935-36, £l3 6s lOd. These figures show a satisfactory increase, and not the least pleasing feature of the position is the fact that the substantial carry-over of wool at the end of last season has been reduced to very small proportions. FROZEN MEAT. The season opened up much better than last year, but, owing to the exceptionally wet weather experienced later in most districts, the conditions for the production of fat lambs became unfavourable. With the rank growth of feed, the lambs did not finish well and gave a lighter average carcass than at the opening of the season. It will be noted that in both mutton and lamb the total show a substantial decrease when compared with last year. The killings of beef show some increase. Owing to the dry conditions experienced last season, it is probable that the decrease in the number of lambs killed will be offset to some extent by a greater_ average weight over the whole of this season. Prices for lamb on the London market remained fairly constant until early in March, when values receded. Prices for mutton have, with minor fluctuations, remained fairly steady throughout the season. Purchasing prices in New Zealand have been relatively high owing, mainly, to increased prices for wool and pelts. REDUCED EARNING POWER. Sir George concluded: You have, no doubt, noticed that there has been a gradual reduction in the earning power of the bank. This has been brought about by a general fall of interest rates both here and in London, by a curtailment of advances, owing to lessened demand, and by increasing deposits which cannot at present be profitably employed. Moreover, the amendments of the Reserve Bank Act and certain provisions of the Primary Products Marketing Act, already referred to, will have a tendency to further reduce banking profits. Mr Watson, at the last annual meeting, drew attention to the fact that a strong financial institution must he of great value to any country. If this hank had not, over many years, built up strong reserves, it could not have carried on the business of the country so smoothly, nor would it have emerged from the ‘depression (through which, happily, wo seem to be passing) in the strong financial position we find it holds to-day. Mr R, W. Gibbs seconded the adoption of the report, which was carried. PERPETUAL FORESTS “ There have been irritating but unavoidable delays in the organisation of the realisation company, and it is impossible to make a statement of policy at present,” said Mr W. Fraser, chairman of New Zealand Perpetual Forests Ltd., at the annual meeting on Monday. Mr Fraser said the greatest advantage that could come to Perpetual Forests would come through the success ot the Forest Products Company. If the Products Company was as successful as the directors felt sure _ it would he, given time and opportunity, then the shareholders of Perpetual Forests would derive substantia) benefits. _ ... Referring to Australian criticism of the company’s affairs, Mr H. Landon Smith, a director, said the purpose of the attacks was obscure. Apparently thej’ emanated mainly from two sources, and in neither case did the parties responsible have any interest in the company. Replying to a question, the Chairman said that while it was preferable it would not he possible to report new developments arising from present

FOREIGN EXCHANGE ON NEW ZEALAND CURRENCY BASIS The Bank of New South Wales, Dunedin, quoted the following rates (to-day) for purchase and sales of foreign exchanges (all rates ’ subject to alteration without notice) : Buying. Selling. London—

The Associated Banks (other than the Bank of New South Wales) quoted the following dollar rates to-day on a New Zealand currency basis. They are subject to alteration without notice. U.S.A. Canada. (Per £1 N.Z.) (Per £1 N.Z.) SELLING— T.T. (dol) 4.02* 4.03* O.D. (dol) 4.03 4.01 BUYING— O.D. (dol) 4.07* 4.08*

negotiations with Forest Products, to a general meeting of shareholders. The decision of the Bondholders Commission in the matter would carry' the same authority as the judgment of. a final court. It would not be advisable or practicable to seek to alter that decision, once it was given. He thought that shareholders would have no reason to be dissatisfied with the results. The report and balance sheet were adopted. The number of directors for the ensuing year was fixed at three, and Messrs Fraser. Owen Jones, and Smith were re-elected. At an extraordinary general meeting, held before the annual meeting, the draft new articles of association were approved without modification, and a special resolution was passed adopting; the articles. >

COMPANY NEWS GOLDSBROUGH MORT NET PROFIT FOR YEAR. [Per United Press Association.] WELLINGTON, June 11. Goldshrough, Mort, and Company Ltd. yesterday' advised the Stock Exchange Association as follows;—The net profit for the year ended March 31 last totalled £179,917. The amount brought forward last year was £l3lj--375, making £311,292, less interim dividend of 2 per cent, in December last, £48.000. The directors recommend a final dividend of 5 per cent., totalling £120,000, which, with the interim dividend, makes a total distribution of 7 per cent, for the year. It was decided to transfer to the provdient fund £5,000, and to carry forward DOMINION BREWERIES LTD. FIRST DIVIDEND DECLARED. [Per United Press Association] AUCKLAND, June 11. Dominion Breweries Limited, recommended a dividend of 6* per cent, on the ordinary shares and at the rate of 6* per cent, per annum on the preference shares for the year ended March 31. This is the first dividend paid by the company, which began operating in 1931. WOOLWORTHS (N.Z.) LTD. [Per United Press Association.] WELLINGTON, June 11. Wool worths (N.Z.) Limited reports an interim ordinary dividend of 5 per cent, on the ordinary share capital, declared payable on July 1. The transfer books will be closed from June 23 to June 30. GEAR MEAT DIVIDEND The Dunedin Stock Exchange Association received advice yesterday that the Gear Meat Company will pay an interim dividend of 3d a share. THE RESERVE BANK THE WEEKLY SUMMARY [Per United Press Association.] WELLINGTON, June 11. The ‘ Gazette ’ issued to-night contains the following statement of the liabilities and assets of the Reserve Bank of New' Zealand as at the close of business on June 8. The figures at the close of last week are given for the purposes of comparison, shillings and pence being omitted : LIABILITIES. \ Last Week. This Week. £ £ 1. General Rescrv. Fund 1,500,000 1,500,000 2, Brk notes ... 10,124,413 10,018.,<0 8. Demand liabilities —■ la' State 9,132,806 9,743,831 b) B ks 7,738,567 7,324,020 (c> Oiler 186.181 93,830 4. Time deici-s ... ... 5. Liabi!i'i>.s in currencies other i*ian New Zea6. Other 5 liabilities ... 76,505 82,083 Xor.il j£T38,758,474 ASSETS. 7. Reserve—(a* Geld . .. 2,801.733 2,801.733 (b) String exchange 23,488,362 23.487,819 (c) (jolc exchange ■“ 8. Subsidiary coin ... 200.934 £00.647 9. Disco«*n <— {h Commercial and afjrculara' Dills <b Treasury ann local bodv oills 10. Advances (a> To State or State undertakings .. —- (o* T<* other cu£)lic authority ... “ 11. Investments 2,008,641 2,014,957 12. Bank buildup -.IT™,, o-n n-n 13. Other us ets 2u8,80a -u9,3.0 ToU ) ... Propo'liop of re?-e*va f. o. 6 \o. 6 to note* -od other liabilities ... . 96.718% 96.<1^%.

THE SEARCH FCR GOLD ALEXANDER MINES The report of the Alexander Mines Ltd. for May is as follows; No. 4 Intermediate Level.—This level has been driven to a point 160 ft north, of the winze, making the total driven on stone at this level 200 ft. The stone showing in the face averages 4ft 6in in width and looks promising for continuing some distance further north. The lode being so strong underfoot, this level was stopped and a winse started at the end of the level. This winze has been sunk 15ft on the lode of varying width from 2ft to 4ft. The bottom shows reef '2ft in the south and 4ft wide in the north and underlying No. 5 North Level.—Driving has been continued, the position of the western drive north, now being 148 ft from the main cross-cut. This drive is being driven to a position where a connection can be made by rising to the winze now put down from No. 4 intermediate Stoping.—Stoping _ has been carried on as usual in No. 4 intermediate backs. On the north side of the main winze the leading and second stopes are being worked, the lode varying from 2ft to 9ft. . , . . Battery.-—For the period 370 tons of ore were crushed for a return of 1720 a 19dwt melted gold. The cyanide department treated 220 tons of sand for 440 z 18dwt bullion.Concentrates roasted and zinc box cleaned up for 440 z Bdwt bullion. The total estimated value of this return is £1,684. , • In addition 10.2 tons of concentrates have been saved, valued at £3OO. In estimating the above values gold has been taken at 140 s per fine ounce. ADELAIDE WOOL SALES Press Association—By Telegraph—Copyright ADELAIDE, June 11. ‘ The prices of all good-quality fleece at the Adelaide wool sales to-day were 5 to 7J per cent, lower than the February levels. Inferior lots-’dropped 10 per cent. Lack of Japanese competition was not responsible for the fall in the better types, which at times enjoyed keen competition, but its absence was noticeable in the inferior lots, of which Japan usually buys large quantities. RABBITSKIN SALE REPORT The Dunedin Stock Agents and Woolbrokers’ Association reports as follows: —Very large quantities were offered at yesterday’s ■ sale, and this, - combined with the easing in prices at recent Australian sales, resulted, ia a fairly marked drop in most grades at to-day’s sale. There was again quite a good demand for bucks, which can be quoted only 3d to 6d lower than last sale's high prices, but does were comparatively neglected and price? were 6d to 18d lower. Inferior sorts were 3d to 6d lower, and there was a bigger drop on spotted autumns, etc. The following is the range of prices:—Summer broken, 2"ld to 28Jd; autumn broken, 40d to 4lid; first winter broken,'s2d to 52id; runners. 30d to 32d; summers--, bucks 36d to 37id, does 30d to 33d; small, 18d to 22d; light racks, 38id to 38Jd; prime racks, 40d to 41Jd; dawny autumn. 451 dto 47Jd; early autumns, 65d to 66id; late autumn, 89d to 93|d; second incoming, Sid to 88d; incoming winter, 96id to 104 d; first early winter —bucks 125 d to 130 d, does 79d to 87jrd; second early winter—does 64d to 74d, bucks IOSd to 112 d: first spotted winters—bucks 107 d to 112 d, does 65a to 67d; second winter bucks, 121 dto 123 d; second winter does, 72d to 76Jd; first winter bucks, 139 d to 140 d; first winter dose, 87d to 88d; prime bucks, 143 d to 144 d; prime does, 91d to 94idi outgoing—bucks 86d to 90d, does 53d to 58d ; springs—bucks 58d to 64d, does 46kl to 49d; milky, 29d to 45d; fawn, 37d to 60d; winter fawn, 80d to olid; summer black. 30d to 32d; autumn black, 54d to 631 d; first winter black. 82d to 84d; second winter black, 60d to 67d; hareskins, 30d to 43id; horse* hair, 17id to 18Jd.

£100 stg. N.Z T.T. £124 £124 10/ O.D. £123 10/ £124 8/9 Australia— £A to £100 £103 10/ N.Z - T.T. £101 Fiji— £F to £100 £89 N.Z T.T. £90 7/6 New York— 4.02* N.Z ... T.T. 4.06i O.D 4.07* 4.03 Montreal— Dollar to £1 4.035 N.Z ... T.T. 4.06J 4.08* O.D. 4.03i Austria— Schillings to £1 20.88 N.Z . T.T. — O.D. • 20.90 Belgium— Belgas to £1 . 23.731 nTz. . T.T. O.D. — 23.742 Czechoslovakia — Crowns to £1 96.51 N.Z . T.T. — O.D. — 96.56 Denmark — 17.893 N.Z T.T. 18.203 O.D. 18.263 17.903 France — Francs lo £1 61.00 N.Z . T.T. • O.D. — 61.04 Germany— Reichmarks to £1 9.946 N.Z. ... „ ... . T.T. — O.D. — 9.951 Holland— Florins to £1 5.921 N.Z . T.T. —- O.D. — 5.92b Java— Florins to £1 5.878 N.Z . T.T. — O.D. — 5.882 Norway— 15.891 N.Z . T.T. 16.181 O.D. 16.241 15.901 Sweden — 15.490 N.Z . T.T. 15.785 O.D. 15.845 15.500 Switzerland — France to £1 N.Z . T.T. O.D. - 12.379 .12.384 Noumea — Francs to £1 N.Z. ... ... ... . T.T. O.D. z 59.63 59.69 Papeete— Francs to £1 N.Z ... . T.T. O.D. - 59.78 59.8<t Hongkong— N.Z. pence to dollar 1 T.T. 18 7-16 19 15-lb O.D. 18 H-32 19 29-32 India and Ceylon— N.Z. pence to rupee 1 T.T. 22 O.D. 22 9-64 3-64 22 57-64 222 Japan — N.Z. pence to yen 1 T.T. O.D. = 17 21-32 17 41-64 Shanghai— N.Z. pence to dollar X T.T. IV 5-32 18 17-32 O.D. 16 31-32 18 33-64 Singapore— N.Z. pence to dollar 1 T.T. 34 7-16 35 1-2 O.D. 34 1-4 35 31-64 DOLLAR RATES.