BANK OF NEW ZEALAND.

Hokitika Guardian, 11 June 1937, Page 2

BANK OF NEW ZEALAND.

ANNUAL MEETING.. WELLINGTON, June 11. The annual meeting of proprietors was .held to-day, Mr A. T. Donnelly, Chairman of Directors, presided, and in the course of his address said: — In accordance with the usual practice, lie proposed to refer briefly to items in the balance-sheet and profit and loss'statement which call lor comment.

Notes. in circulation, £62B—a reduction of £323,824. The present balance represents notes of a Fiji issue still outstanding.

Dijjposits, £35,636,112, show ; little variation.

Coin, Reserve Bank Notes, and Deposits with bankers, £7,929,471, are more by £1,016,330 than at 31st March 1936.

Money at Call and Short Notice, Government Securities, and Other Securi ties in London stand at <£,122,420 —a reduction of £1,050,000, L

Bills receivable in London • and in transit, £1.;3|38,924, which is lower by £935,947 than a year ago.

The fluctuations in these three items are mainly due. to .the diversion of the dairy produce, exchange to the Reserve Bank from Ist-August .last.

New Zealand Government Securities. £4,626,094—an - increase of £1,229,037. The purchase of Treasury , Bills and short-dated stock accounts for the higher figures. Australian Government Securities £2,995,900, are lower by £1’,591,913 sales having been made from time to time to replenish our cash funds in Australia.

Advances and Bills Discounted, etc.. £23,663,948, show an increase of £l, 1 484,575. 7 / Salaries and Allowances £553,072, are higher by £26,891, due principally to adjustments made in the salaries of some of the staff in accord ance with i legislative enactment which had for its object the restoration of certain salaries to the 1931 scale, i Rates and Taxes amounted to £323 |289, which is more.by £32,09/ than last fyear. Both Land and Income Taxes /have been increased. As you know, ]the banks are assessed for income tax, •not on their actual earnings, but on an assumed income arrived at by adding their average assets and liabilities in New Zealand together, and taking 30/per cent, thereof. Strong representa tions to the authorities have been made by the banks from time to time; as to the unfairness with which this system operates. ,A Committee to consider and report on taxation generally was recently set tip by Cabinet, and the banks’ case for relief has been submitted to that Committee. Dividend An interim dividend of n 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 o. shares will be payable in Wellington to morrow and at Branches on receipt ol advice. • Board of Directors The term of office of Mr R. W; Gibbs, one of the Shareholders representatives on the Board, expired on 31st March last. He offered himself and was re-elected.

The term of office of Sir George Elliot and himself expired on 31st March last. The Government reappointed him for a further term, and Mr John Dowgray, of Granity, Westport, was anpoii ted in the place ; of Sir George Elliot. The Board had done him the honour of electing him Chairman for the yeai. Staff He ' expressed appreciation of the loyal and efficient services of the staff

in New Zealand, London, Australia Fiji, and Samoa.

The profit for the year being considered sat sfactory, the Board felt j- s tilled in granting to the staff a bonu. of 7$ per cent, on their salaries as ai 31st March as a tangible mark of appreciation of their services. Banking Figures The deposit and advance figures ol the six trading banks for the March quarter of 1937 show some materia changes as compared with the corres ponding period of a year ago. The total «average deposits have increased by over £600,000, but a marked move ment has taken place in the two classes of deposits, free deposits having increased by £5,291,080, while fixed deposits are lower by £4,603,926. Advances, have increased by £1,831,874. Our advanes in the March quarter ol 1937 represent 68 per cent, of our ) total deposits, as compared with 63 per cent. for., the corresponding quarter last year. . The percentage of fixed deposits is 53 per cent., as against 60 per cent, in 1936. 1 . The free deposits,. fixed deposits, and advances of this Bank represent 43 per cent., 74 per cent., and 43 per cent, respectively of the total figures of the trading banks in New Zealand for these items. • Dairy Produce. Tt is estimated that when allowance is made for the relatively heavy quantities sold at low prices, the average ’■pa'isations to date will be in the vicinity of , 97/6 for butter and 61/- for cheese. Wool. Shortly after the July series of London wool sales a' Strong inquiry developed from all sections of the trade. Activity slackened off shortly before the September series, but as the sales progressed competition and values improved. From then onward the demand for all wools was strong, and at the November series prices appreciated from 15 per cent, to/ 30 per cent. Jfc has been stated that users of wool are “nearer the sheep’s back” than they have been for a long period. 11 this is the case then, apart from political disturbances, prices should remain on a remunerative basis for some time. The total number of bales sold in the Dominion wool salse during 1936-3 1 season was 663,798. 1 lie total value was £(N.Z.)14,903,257— an increase ol £5,062,830 compared with last year. Frozen Meat/ Owing to the wet weather and lack of sunshine, lambs were slow in coming into the freezing works. Feed was rank and full of moisture, and generally lambs were not up to standard. Jn the North Island there is still a large number of.lambs unfattened, and it is doubtful if they will be brought to a condition suitable for export. Con ditions in the South Island have been somewhat similar. Values on the London market have followed practically the same course as those of last season, remaining fairly firm- utnil the middle of March, when prices receded. Owing to the high prices received for by-products, however. the total receipts of farmers for meat products have been very remunerative. # Mortgagors and Lessees Rehabilitation Act, 1936. To enable mortgagors, lessees and guarantors whose liabilities, by reason of reduced values and altered conditions have become unduly onerous, to obtain a review of their obligations, the Government in October last brought into operation the Mortgagors and Lessees Behabilitation Act. The general purpose of the Act in relation to farmer applicants “is to retain them in the use and occupation of their farms as efficient producers, and to make such adjpstments of their liabilities as '"'ill

ensure that the liabilities secured on any property do not exceed the value of that property, that the rent of any leasehold property does not exceed the rental value of that property, and that the total amount and terms of payment of all their liabilities (whether secured or unsecured) are such that, after allowing for all normal current expenditure and providing for the maintenance of themselves and their families in a reasonable standard ol comfort, the applicants may reasonably be expected to meet their liabilities as they become due, either out of their* own moneys or by borrowing on reasonable terms.”

It is pleasing to be able to report that, having regard to the magnitude of the Bank’s operations, comparatively few of our customers liav-c applied, for adjustment of their obligations to the Bank. In many cases the applications of our customers have;been for the adjustment of their liabilities to'creditors other than the Bank ; but as, under the Act, an applicat ion for the of any liability involves a review 01 the applicant’s whole position, the Bank has necessarily been concerned in all such applications. A comprehensive Act of this nature, imposing novel conditions as between

creditor and debtor, has unavoidably introduced new problems of administration, particularly where considerable time must elapse before applications are finally dealt with; but in all cases the Bank has endeavoured to promote the smooth working of the legislation by devising methods which would on a '.V the various applicants to carry on their businesses, farming or otherwise, without embarrassment.

Si far few decisions have been gtyen by the Commissions and the Court in cases in which the Bank is concerned. I am, however, pleased, to be able to inform you that in a number of instances voluntary settlements'have been arranged with customers on terms which have be n regarde 1 by the applicants as quite, satisfactory.

I should like to clear up a misconception which may exist in the minds of some of our customers and possibly others. It is not the policy of tne Bank to call up advances a> at any time. While bank advances are repayable on demand, the occasions on which formal demands for repayment are made upon customers .are rme, and it is only where there are very strong reasons for taking such a stoo that this is done. It must bo remembered

that the success of the Bank depends

on the goodwill of its customers and v j that if its borrowing customers are subjected to treatment which they J have reason to consider is unnecessarily arbitrary, that goodwill may be speedily lost A little reflection would show how unwise it would have been for the Bank, even bad there been no relief legislation restricting the powers of mortgagees; to embark in depression years on a policy.of insisting upon repayment of loans and, m default of repayment, exercising the powers and remedies of a mortgagee* _ . He moved that the Ecport and Bal-anV-e-sbeet be adopted. Mi>William .Watson said be bad plea- \ sure in seconding the motion for the adoption of the Keport and BalanceSheet. - The Chairman has given von a very full account of matters affecting the business of the Bank as well as of tne Dominion during the financial year under review. He has alluded to the removal from the trading banks of the exchange Fusing built up bv them in many years in connection vitli t eir assistance "to the dairy industry Notwithstanding that loss, however. by charing in the natm-al progress of the Dominion, enhanced bv the recent! rise in values of the principal exports, the results for the year are, shown to be satisfactory.

Remarkable as the progress of New Zealand has been, it has become a matter of concern of late that in years the increase in the population has not kept abrest of that in other parts of the British Commonwealth. Many have already made public their views as to the absolute necessity of steps being taken to secure a greater population for the safety, development,;;and trade of tile country'." Railways.' roads and harbours, heve been prepared at heavy cost, and, by want of sufficient use, several of them are now burdensome to the,districts and to the nation. His reason for adding this subject in seconding the motion for the -adoption of the Report and Balance Sheet is that he believes it to he as important to the Bank and-its shareholders ns to all sections of the people. , !. .