Finance and Investment

Evening Star, Issue 25770, 17 April 1946, Page 8

Finance and Investment

1 INVESTOR'S NOTEBOOK AUSTRALIAN BANKS INCOME AFFECTED BY WAR The war has not been kind to the nine Australian trading banks, and their reduced earning capacity is reflected in striking changes in the distribution of their assets during the war. Advances, which are the principal earning assets, had fallen to £207.7 million in February of this year from £279.7 million in February, 1940. They now are only 33.1 per cent, of total deposits, , amounting to £628.6 million, as compared with 79.1 per cent, of total deposits ot £347.8 million in February, 1940. The overdraft rate is now 4$ per cent., compared with 5 per cent, at the earlier date. Treasury bills now represent 11.5 per cent, of deposits instead of 12.7 per cent, previously. The discount rate is now 1 per cent, instead of l' s per cent. Other public securities, mainly Government bonds and stock, have increased from 9.5 to 18.9 per cent, of deposits. Lower interest is earned from war-timo additions than on pre-war portfolios. Although cash balances have fallen from 13.1 to 7.1 per cent, of deposits, "spec;.! accounts" impounded by the Commonwealth Bank have risen from nil to 33.7 per cent, of customers' deposits. On these special accounts,' it is understood ft interest approximating the cost of acquiring and handling deposits is paid. Keductions in fixed deposit rates pre offset by an increase to 64.8 from 39.9 per cent, in current accounts relativelv to total deposits. 1.C.1. DIVIDEND. (P.A.) WELLINGTON, April 16. Imperial Chemical Industries Ltd. recommend a" final dividend on the oidinary stock of 5 per cent., making 8 per cent, for 1945. BANK STOCK INTEREST. The Reserve Bank has advised the Stock Exchange that the first interest, paymenl on 15/11/1957-60, 3 per cent, stock (the Bank of New Zealand stock), to be made on May 15, will amount to £1 12s 5d a\ £IOO of stock. This payment covers interest from November 1, 1945, the date of tho commencement of the Act. DUNEDIN BREWERY The annual meeting of the Dunedin Brewery and Wilson Malt Extract Company was held yesterday afternoon, the chairman being Mr W. Anderson. Certain raw materials seemed even more difficult to obtain than was the case during the war, said the Chairman. If t.ie present shortage of transport continued, it would very seriously affect the compa'nj's turnover, as the bulk of the company s output went to the North Island. If Dunedin was to prosper, then better transport between this city' and the northern markets would have to be brought about somehow. In moving the adoption of the report and balance sheet, the Chairman referred to the heavy burden of taxation. As. the greatest amount of war expenditure was now being saved, he said, surely sumu relief by way of taxation should have heen forthcoming long ago. If the Government expected industries in New Zealand to expand, it should give them the opportunity by way of relief. No manufacturing concerns had sufficient funds (after paying the high income tax) to purchase new machinery and generally improve not onlv the efficiency of the factory, but the conditions for the "staff. "All the talking will not bring about relief, however.'" lie added. " We must just sit down and wait." Mr Anderson stated that, of the company's turnover, the whole amount of money was disbursed as follows: —Wasres took over 16 per cent., raw materials 38A per cent., general expenses 9 per wit., and duty and taxation 34 per cent. There was left for the shareholders, just a iitt'e over 2 per cent. "It can safely be said," he commented, " that these pereenrages are similar to those of other companies, so the story that manufacturing concerns are making pots of money for ihemselve> is just a fairy tale." ..■!■■■" PHILLIPS AND IMPEY. Net earmngs of Phillips and Inipey Ltd. for the year ended August 31 were £17.865, against £17,385 in the previous vfar and £14,071 in 1943. The usual dividend of 8 per cent., plus a bonus of 24 ner cent., absorbed £13,125. A sum of £5,000 was placed to the credit .of goodwill account, reducing it to £35,000| and £1,250 was transferred to taxation reserve, leaving £26,661 to be carried forward, against £2.817 brought in. Gross earnings were £94,800, an increase of £6.306 but expenses, including taxation provision, rose £5,826 to £76.935. SHARE MARKET INDICES.

New York.—Dow Jones (1926 equals 100) ; 1939—Highest (Sept.), rails, 35.90; industrials, 151.22. Lowest (April), rails, 24.15; industrials, 121.4.

Lo ndon .—Financial Times (1926 equals 100) : — Govt. Rails. Indus. Gold. Feb. 28 ... 117.4 63.4 - 144.8 • 174.2 Mar. 27 ... 117.3 64.2 142.5 .160.0 Mar. 28 ... 117.3 . 64.2 142.6 159.7 Mar. 29 ... 117.3 64.1 142.7 159.8 Apl. 1 ... 117.4 64.2 142.9 159.5 Apl. 16 ... 118.7 65.9 148.2 157.2

Rails.. Indus, i Shares sold. Feb. 28 ... ... 62.23 190.09 1,170,000 Mar. 28 ... ... 64.10 198.18 900,000 Mar. 29 ... ... 64.32 199.56 1,220,000 Mar. 30 ... ... 64.26 199.75 610,000 Apl. 1 ... ... 64.30. 199.19 1,050,000 A pi. 6 ... ... 64.32 204.98 690,000 Apl. 15 ... ... 63.58 206.01 1,170,000