PAST YEAR UNDER REVIEW

Hawera Star, Volume LIV, 14 June 1935, Page 5

PAST YEAR UNDER REVIEW

BANK OF NEW ZEALAND IMPROVED TRADE CONDITIONS SURPLUS IN PUBLIC ACCOUNTS (Special to the “Hawera Star”) WELLINGTON, To-dav. At the annual meeting of the proprietors of the Bank of New Zealand Mr Wilii&m Watson, chairman of directors, reviewed tbe bank’s trading operations for the yeah and mentioned rnat an interim dividend of 5 pet cent, was paid in December last, while the profits permitted the payment of a further dividend of 5 per cent., making 10 per cent, for the year—the same distribution as last year— earned on the whole funds and not on the capital alone. The chairman, in his address, said: —

“The 4 per cent, guaranteed stock, £529,988 10s 6d, which was .for so long included in our capital figures, fell due on July 19 last and was repaid from the bank’s London resources. The figures otherwise remained unchanged. “Notes in circulation amount to £503,77S 10s, as compared with £4,259,110 at March 31, 1934. “I'or a number ol' years the rate the banks paid for the right of note issue Was 3 per cent, per annum on their notes outstanding as calculated from week to week, but five years ago the rate was itiised to 41 per cent., which, with the costs of the notes and expenses in connection with them, left little or no profit to the banks. On August 1 last the Reserve Bank exercised its sole right to issue notes iu the Dominion, but until August 1, 1936, the trading banks will continue to pay the tax on their unredeemed notes, after which date each bank will pay' over to the Reserve Bank the face value of its notes outstanding and cease to pay further tax. “Large quantities of notes on which tax is now being paid have been destroyed in various ways, and while the trading banks will pay the fuji face values of these to the Reserve Bank, that bank will, of course, never be called upon to repay' the losers. “At March 31, 1934, th© trading banks’ notes in circulation' amounted to approximately £6,200,000; on the corresponding date this year they had been reduced to about £850,000, while the notes issued by the Reserve Bank totalled ovc* £9,300,000. The larger amount is accounted for by the fact that the trading- banks have to purchase Reserve Bank notes for till money. Our average holding for .this purpose is well over £2,000,000. “Deposits show a reduction of £1,129,390, the greater portion of which is accounted for by transfer oi. Government balances to the Reserve Bank “Coin, Reserve Bank notes, and de .posits with bankers are lower by £567,086. “Money at call and short notice, Government securities and other securities in London show an increase of £3,422,121, due to our purchases of London exchange having exceeded sales. “Bills receivable in London and in transit are less by £1,008,420, owing principally to lower prices for wool. “New r Zealand Government securities of £3,147,671, are less by £5,567,861, due to repayment of New Zealand Government Treasury Bills. “Australian Government securities show ft reduction of £93,087“Advances and bills discounted, of £21,490,731, show's at slightly lower figures than a year ago. Loans to the State against discharged soldiers’ settlement mortgages have been repaid. Our advances to the public show an increase.”

future progress. After dealing with various aspects of the economic situation, the chairman said that as far as the Bank of New Zealand was concerned he saw no reason to anticipate any decline in its progress. “Ordinary trade and the manufacturing industries have improved during the year, no doubt partly owing to more confidence as regards the exchange Tate, and also to the favourable prices obtained for last season’s wool,” he said. “The public accounts disclose that hr the past financial year the revenue amounted to £26,126,000 and the expenditure to £24,500,000, leaving a surplus of £1,620,000 principally due to profits ou the sale of portion of the gold taken over from tho banks and unusually' high receipts from death duties.

“Although the prices of our main products generally are at low levels, and our principal market-is- threatened with restriction as regards dairy produce and meat, it is better to be hopeful and pessimistic regarding the future and to strive for, and look forward to, better things. “A viskor with experience of South America recently told us that our land values were too high. He was only stating what a great many people >n New Zealand believe to be the fact. “Easy and plausible remedies are suggested to restore good times. . Industry and thrift seem to have little place' in some of these ideas which, Were they put into operation, would make the position of the people vet> much worse. It is surely better to face our difficulties than look for easy and futile ways of avoiding them. “New Zealand is in many respects a very favoured country. It should be borne in mind that ups and downs me the common lot of a people, and that our present difficulties, unpleasant though they may be, are not beyond the power of men to overcome.”