BANK OF NEW ZEALAND.

Hawke's Bay Herald, Volume XXX, Issue 10093, 7 September 1895, Page 4

BANK OF NEW ZEALAND.

MEETING OF SHAREHOLDERS. & l \V. [BY TELEGRAPH.] sh Wellington, Friday. hi Ati the adjourned annual meeting of gt fthe Bank of New Zed'aud this afternoon sb ■the president dealt at length with the m •provisions of the Acb juat passed. Ho f » ■aid in addibion to (he entries required by di the Act, it was now propised to wtite off the reserve tundot £4s,ooo, and tho balance Of profit) and loss of £383, so aa to reduce a( the bad, and doubtful debts to £376,900. a| After referring to the new call, he said in „{ any event no further call can be made | n until after December 31at, IS9S. Tbe t t Whole ot the stations, implements, stock, D , and lauded properties in New Zealand, p ; the properties of tbe Auckland Agricultural Company and the Company, and the shares ia the Thames Valley Land Company, are to be sold to the Assets Realisation Board for £2,731,706, and saoh additional sum as may be necessary to adjust the acconnts after March. After this tbe Incubus in the assets of the , Bank and the Estates Company will be replaced by debentures ot the Asseta Board . bearing3£pe.rcaQblnterest,andhavlngaDy deficiency upon them guaranteed by the colony. By this transaction the B»uk of *- New Sealand Estates Company 'b balanceanee'o will be rednced to small figures, and th 6 position of the company be rendered ■ thoroughly sound. The bad debts written t] off the. books ot the Assets Company will „■ be £467,000, 'against which no asseta exist, and £296,500 to brine down the remaining assets to their proper realisable values; the present deficiency in asseta to .be. taken over by the Asseta Board ? ■waa computed at £860,000. With good " management by tbe Board and an " advance in the prioe of wool, &0., this l deficiency mighb be made to disappear, X and the capital and goodwill of tbe Bank would be then the free property of the - shareholders. Meanwhile the oolony, to, secure the deficiency, has „ a Hen. on the shareholders' capital and 'ancalled reserve liability. Keferri'jg to the power given to the bank to purobase the business of any other j bank, be said it would enable the bank to . pay the shareholders regular dividends of | S per cent per annum, and contribute , materially to the reduction ot the defi- I oienoy of the Assets Realisation Board. ' Tbe tfieot of the provision would oe to eep^rate entirely the bank from any risk ' attending the large macs of properties standing in tbe books at nearly three millions. Had the directors thought such a serious fall in. wool and other produce was about to take place they would probably never, have incorporated the company at all. He pointed out tbat tbe numerous financial lnstibutiona doing business ia the colony had sufiered severely, and in many instances not only bad the shareholders to pay oalls, bnt had lost their properties. Ho explained tbat at the last meeting, though they hhd nob contemplated any farther call to be made on tbe reserve liability, tbey were then unaware of the position ot the Batatca Company, as the Recounts of tbe bead office in London had nob been received. He then detailed the investigations of the directors, which led to. tbe Government being applied to for assistance, t»nd pointed one wbere the eoheme submitted by the directors differed from thnt adopted by the Joint Committee; had the directors' recommendations been carried out, no c\U might have been. necessary. The directors coustder the shareholders should be grateful for whab Parliament has given effect to, for bad the bank been allowed bo go into liquidation the shareholders would undoubtedly have had promptly to pay the whole resetve liability, or as much of It as they Individually could. Under tbe scheme adopted there was every probability of their Retting 5 per cent interest, besides having under favorable circumstances,bbe goodwill of enhanced bntineua preserved to them. In conclusion he .said by the Aob of the Legislature tbe position of the bdftfc ac regards ica creditors was readetud as secure and strong as that of any Institution doing business south of tbe Equator, and their position being Tiow thoroughly ascertained, rthareholdera might well look forward with confidence and hope. : The report and balance-sheet! were adopted. .■>.. , . L&TKK. Major Messenger asked fjr a defiaicion Of the goodwill of the b .rik, and what was the position of the bank shareholders 1 It appeared to him that the Government now managed it, and i> the shareholders wished to wind up the Government would not allow them to do so, In replying, tbe President said the goodwill was the reversionary interest in the whole bank. ' When tbe deficiency of the Assets Company, to be taken over by the Realisation Board, was wiped off, all profits reverted to shareholders. The latter had active power, as they appointed their directors, bat Parliament had the power, of veto. Ms Blanchard made a severe attack on th*j directors for nob taking shareholders more into their confidence, and refusing to divulge necessary information to shareholders, while they took tbe position to a committee of persons not connected with the bank. He strongly opposed tbe Banking Bill, declaring It to be iniquitous in the extreme. He challenged the direotors to postpone the msetiot; nntll the London shareholders had had an opportunity, of considering the effect of recent legislation. He moved that the London directors and thoao associated with them in London, bs called on bo resign. (Motion not seconded.) Mr Blanchard said if he had sufficient money be would apply to the Supreme Court to place the bank in liquidation. He strongly urged shareholders nob to part with tbeir rights, and spoke against their handing prcxiea to directors. Mr Riley, Dnnedin, regretted the speech of, Mr Bianchard, and moved a resolution, " That a hearty vote oi thanks be accorded to Parliament, and especially to the Government, for the assistance they had rendered to the bank aad the. colony as a whole, and also for the consideration shown to the poorer shareholders in extending calls over a lengthy period, and placing the b.»uk on a sound foundation." Hu commended the action of the directors in the steps they had taken to prevent the bank closing, Tbe bank had been on the brink of a volcano for a long time, and had it not been for tbe good judgment and kindly impulses of the Government it would have been, bloivn Co atoms. He trusted that the call would eventually be the nncleua of frebh capital to tho bank. Had the Act not passed small Bettlers would have been pinched. Working men, too, were benefited, for had the bank closed down, where there was one man unemployed there wonid have been a hundred, as all Industries would have been affected. Mr Tanner seconded tbe motion. In doing so he thought that the adverse remarks of Mr Blaucbard should refer to those directors who gob the bank in diffi-. cnltiea, nob the present Board. He thought shareholders should show their gratitude to the Government for helping them ont of the difficulty. Mr G. Allen said ib would have been a very sad thing had the bank closed, though personally be would not huvu cared had the Institution been wonnd up. Mr Charles Smith hoped that Che motion would not be carried in the shape it was, and tbab tbe words " sound foundation" be eliminated, as ib mighb raise the hopes of the London shareholders, Mr Martin Kennedy, one of the directors, supported tbe motion. He spoke favorably oi the action of the Government, for had assistance not been given ' the director? , under tbe deed of agreement, would have had to force realisation, aua many shareholders wonld have been ' ruined. Shareholders would, he thought, be able to finance their shares and io save something. He had little donbt thab the amount of interest mentioned in the report would be earned. If the Institution had been wonnd op, every penny in the bank wonld have been lost, whereas now shareholders were partly seenred by assistance, anddeposltora were guaranteed every penny ot their money. If business Improved for the next few years, there waa no doubt, tbab the goodwill of the bank would be largely enhanced in value. In replying, Mr Riley said he was satisfied tbat there waa no bank trrdlog In New Zealand in so impregnable a posision as was the Bank of New Zealand. The motion was carried almost unanimously. Mr Kennedy said he desired to explain thab although the Government nominated a president and auditor of the bank, no Information of clientß' positions waa dl vnlged. The intention of the Government was only to maintain legitimate control as a director, lie felb positive the bank's Interests would not suffer by these appointments. Tbe meeting broke up with a vote of thanks to the officers of tbe bank.