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New Zealand Herald, Volume XXII, Issue 7382, 17 July 1885, Page 4

A cable message announces that the balance-sheet of the National Bank of New Zealand (Limited) shows the doubtful debts to be £131,000, and to meet possible contingencies on this account the shareholders have agreed, at the annual meeting held in London on the 14th inat., to transfer £100,000 from Capital account, and £10,000 from the Reserve fund. This information has been generally known in Banking and Commercial circles in Auckland for the past week, and the Directors and Management have been commended for having the courage to face the difficulty Bnd get rid of it once and for all. It must be borne in mind that the amount now transferred is not altogether lost, as it is represented by large securities in the colony, which have shrunk in value owing to the long and continued depression in the South Island. With a revival in trade and commercial pursuits, these will soon again grow to their former values. In the early days of all Banking Institutions unsatisfactory securities are apt to be taken, and the best polic3 r is as euon as possible to write them ofT as doubtful assets, and thus place the Institutions in a aound business condition This course was taken in Australia some time ago by the Colonial Bank of Australasia and Commercial Bank of Australia, Limited, and, though it caused temporary cessation in dividends to the shareholders, the wisdom of the step was soon shown by increased business and a decided advance in the shares. Both these Banks are now in strong positions, with large accumulated reserves, and such will, we doubt not, soon be the result in the instance of the National Bank. The Bank being cleared of old-standing impediments, will be more firmly established in the estimation of the Proprietary and its Constituents, si.ll of whom we feel assured will join with us ia our approval of the wise course adopted at the annual meeting of shareholders. The telegram conveying the substance of the message received from London by the Inspector of the Bank, and which appears in this issue, supplies important information respecting the effect of the decision adopted at the annual meeting of the shareholders. It will also be gratifying to those shareholders resident in the colony, and will tend to increase their interest in the operations of the Institution, to know that Messrs. Edward Pearce, of Wellington, and James Rattray, of Dunedin,~gentiemen of acknowledged colonial reputation and business experience, have been appointed Directors of the Bank.