NEW ZEALAND LOAN AND MERCANTILE AGENCY CO.

New Zealand Herald, Volume XXVI, Issue 9324, 29 March 1889, Page 6

NEW ZEALAND LOAN AND MERCANTILE AGENCY CO.

The twenty-fourth annual general meeting of this company was held at the Cannonstreet Hotel, London, on February 1, the Right Hon. Sir James Fergusson, Bart., G.C.5.1., K.C.M.G., M.P., in the chair.

In the report it was stated that the net profit for the year ISBS, inelusive'of £15,053 15s fid brought forward from the preceding year, after deduction of expenses, interest, commissions, income tax and property tax, writing off stationery, and making provision for bad and doubtful debts, exhibited a sum of £82,153 7s fid, which the directors recommended should be applied as follows :— To payment of a dividend at the rate of JO per cent, per annum, and interest on capital paid in advance on old shares £59,678 15 8 Payment of bonus at 5 p j .r cent. .. 19,776 3 i Payment of interest at 5 per cent, per minimi on capital paid in advance on sixth issue shares 10,3."S 3 7 To be carried forward 12,M0 i 11 £82,103 7 C On 6th July last an ad interim dividend was paid at the rate of 10 per cent, per annum, amounting, with interest on capital paid in advance on old shares, to £19,018 I Is '2d ; and on 31st December, £10,358 3s 7d interest to that date at 5 per cent, per annum on capital paid in advance on sixth issue shares, so that there now remained for distribution the sum of £40,436 7s lOd. The Chairman said : Gentlemen, I have been a director of this company, with an interval of official service abroad, since 1875, and I gladly retain my connection with it. I resumed it on my return from India, and from the continued, interest 1 take in the Australasian Colonies, 1 am glad to think that a company with which I have been so long connected, and which is so intimately bound up with their progress, has been able to maintain its eminent position and its prosperity during years of perhaps unexampled severity. We have from time to time in our annual reports and proceedings entered so fully into the vicissitudes of these colonies, that I do not think I need touch on them, especially as their circumstances must be known to everyone connected with this company. At the last general meeting my right lion, friend, Mr. Mundella, described to you the remarkable growth and progress of the company, both as to its capital and mercantile agency operations, but it is my duty to call your attention to the fact that the meeting we are now holding is perhaps the most important which has occuired since the foundation of this company twenty-four years ago : we are now making a new departure in its management. Mr. Mundella pointed out to you last year the successive additions to the capital necessitated by the expanding business of the company, and he suited to you that it would be necessary yet further to increase the capital, in order to keep pace with our extended commercial operations, which it is lie policy of the directors to foster. Well, gentlemen, that was carried out by the addition of half-a-million to the capital of the company in '20,000 shares of £25 each, which are virtually paid up in full. By this means the paid-up capital, which on 31st December, 1887, stood at £364,245, has, during the past year, been increased to £8(53,(585. When the company was originally established in 18(55, its subscribed capital was £500,000 only, its operations were confined to New Zealand, and then there was a fitness in giving to a Board of Directors in New Zealand large powers of control. .Since then additions have from time to time been made to the capital, until it has now readied the sum of £4,000,000, an amount which is requisite in order to the proper conduct of the existing operations of the company. These have gradually been extended from New Zealand to t.he Australian Colonies, until at the present time threefourths of our business is in Australia. Similarly, whereas some years ago a large proportion of the company's shares was held in New Zealand, now nearly three-fourths of the share capital is held in this country, the remainder being distributed amongst colonial proprietors. The debenture capital of the company is likewise wholly derived from British investors. These facts emphasise the necessity for making a fundamental change in the constitution of the company, by which increased power of control and supervision of the company's colonial operations should be placed in the hands of the London Board of Directors. The resolutions requisite for this purpose will be submitted for your consideration and adoption at an extraordinary general meeting, to be held at the close of this meeting. In carrying them into effect, it will bo necessary to establish colonial Hoards of Advice to co operate with our managers in the colonies, who will be directly responsible to the London Board, so that no important transaction can take place without our approval and confirmation. In order to carry out the arrangements necessary for the establishment of such Boards and management, our able colleague, Mr. Larkworthy, lias recently proceeded to the colonies, where he is now engaged in examining the business of the company, with a view to communicating to the Board here the recommendations which he thinks will most effectively carry out the 'end in view. But, gentlemen, having regard to this increased control and responsibility, we must strengthen the Loudon Board. In consequence of the death of our late colleague, Mr. Boutcher, it is desirable that the vacancy should be filled with as little delay as possible. 1 am glad to inform you that one gentleman, with whose business qualifications I am well acquainted, has consented to accept a seat on the Board. I refer to Sir George Russell, Barb., M.P. for Berkshire, who, in addition to being a good lawyer, has large experience in the management of commercial affairs. There is another important change in the administration of the company, to which it is fitting that I should allude on the present occasion. For some years steps have gradually been taken with a view wholly to transfer the conduct of this company's business from the officials of the Bank of Now Zealand. In the early days of the company's existence, when its operations were nob only much smaller, but were confined to New Zealand, it was undoubtedly not only convenient, but economical, that the representatives of the Bank of New Zealand should also act there as agents fur this company. I believe that the relations between the bank and the company have been mutually profitable, bub with the increase of our business a gradual separation in colonial administration has been found expedient, until at length we have now throughout the Australasian colonies independent managers and agents. In London a like policy has been pursued, and

our offices will be removed from the build, j ing in the occupation of the Bank of New Zealand as soon as it may be convenient to do so. Gentlemen, you are familiar with J the great depression which has recently existed in the trade and commerce of the world, from which the Australasian colonies have not been exempted, There has been, 1 as you know, a fall in prices which has seriously affected their agricultural industries. While in consequence of such depression it could not be expected that this company should enjoy an entire immunity from losses, by a careful forecast of the position from time to time, and the maintenance of prudential reserves, provision has been made for all actual or contingent losses according to the latest advices in our possession. What may be the effects of the great drought by which the Australian Continent has lately been visited we cannot, of course, at. present say; but information has been received that in certain parts of South Australia, where two months ago the drought was most severe, so great is the recuperative power of the soil that with the advent of rain the whole aspect has changed, and country wire I) at the beginning of last December was but a barren waste is now clothed with abundance of grass. I am triad to able also to add that this company s advances are by no means large in those districts where the drought has been exceptionally severe. Before formally moving the adoption of the report it may be useful to call attention to one or two items in the balancesheet which has been laid before you. Taking first the debit side of the account, it will be found that the net profit for the financial year 18S8 is £82,153, against £69,568 in the preceding year. I have already made allusion to the increased capital of the company of £500,000, but it is proper to point out that as the instalments clue thereon were only paid during the last six months of the year 1888, the full benefit of this addition to the company's resources has not accrued in the period now under consideration. Turning to the credit side of the balance-sheet, under the heading company's premises, stores, and plant, will be found the sum of £225,084, which compares with £291,313 in the balance-sheet of 1887, or a diminution of £60,229. This arises chiefly from the sale of the company's premises in Collinsstreet, Melbourne, to which allusion was made in the report of 1887, less the cost of land purchased at Kensington Hill, in the vicinity of that city, where in due time premises suitable for wool and grain stores will be erected, and the surplus portion of the land not required for that purpose will be disposed of. From the satisfactory price at which the site was acquired, no difficulty is anticipated in selling such portion on favourable terms. The re-erection of premises,, in Gisborne, New Zealand, which had been injured by fire, was also completed last year at a small additional cost. The Chairman then moved the adoption of the report. Sir E. W. Stafford, G.C.M.G., seconded the resolution.

Mr. J. Skbag Montkfiore expressed his entire confidence in the directors and his satisfaction with the report and statement of accounts, and with the explanations which had so fully and ably been given by the Right Honourable gentleman who occupied the chair. The Chairman, in reply to inquiries made by several shareholders as to the disposition of the profits on the Melbourne premises, explained that the course foreshadowed by his colleague, Mr. Mundella, who presided at the twenty-third ordinary general meeting held a year ago, had been followed, and the amount had been placed to the prudential reserves of the company, a course which, from the friendly remarks waich had been made, he felt sure commended itself to the meeting as the right one to pursue. The resolution was then put and carried unanimously. The re-election of theßightHon. Sir James Fergusson, Bart., G.C. 5.1., K.C. M.C., M. P., as a director of the company, was m ved by Dr. Drysdale, seconded by Mr. Nicholson, and unanimously carried. Mr. Abraham thereupon moved the reelection of the Right Hon. A. J. Mundella, M.F., as a director of the company ; the resolution being seconded by Mr, Pankhurst, was unanimously adopted. A cordial vote of thanks to the directors of the company was moved by Mr. Willan's, ■seconded by Mr. Montkfiokk, and unanimously carried. .Mr. Thomas Russell acknowledged the compliment.

Dr. Drvsdale moved that the thanks of the meeting be given' to the managing directors, manager, and officers of the company, both in England and the colonies, for the efficient discharge of their respective duties, which being seconded by Dr. Weir, was unanimously agreed to. The extraordinary meeting was then held, when the resolutions passed at a previous meeting were confirmed.