THE BANK AMALGAMATION.

New Zealand Herald, Volume XXXI, Issue 9615, 13 September 1894, Page 5

THE BANK AMALGAMATION.

[BY TELEGRAPH.—PRESS ASSOCIATION.] ', Wellington, Wednesday. The agreement as to the amalgamation between the Bank of New Zealand and the Colonial Bank was signed yesterday by Mr. Murray on behalf of the Bank of New Zealand, aud the Hon. George McLean, chairman of directors of the Colonial Bank, and was at once forwarded to the Government. It is now under consideration by the Cabinet, and should the terms be approved of, the agreement will require to be submitted for confirmation to a general meeting of the shareholders in the two banks, which take place at Wellington and Dunedin respectively on the 26th instant. [BY TELEGRAPH.— CORRESPONDENT.] Wellington, Wednesday. Various rumours as to the contents of the signed agreement between Messrs. Murry and McLean for their respective banks are afloat, bub I believe the following will be near the mark :—The terms of the agreement for the amalgamation of the banks are now stated bo be that for purposes of account the shares of the Colonial Bank shall be credited at par. and those of the Bank of New Zealand ab a discount of 33J off par value. To balance this discount, apparently £30,000 is to be paid from out of the first profits of the reconstructed Bank to the credit of the Assets Company, and that concern is to be further contingently benefitted by payment of all profits of the Bank in excess of 6 per cent, for ten years. Excepting as to this liability the Assets Company will be completely separated from the Bank by statutory enactment. Power will be taken by the Bank of New Zealand to issue new Bhares to colonial shareholders of a full value of 40s, which is the par value of the shares they will surrender. Further, their shares will not carry any contributing liability, and the present shareholders of the Bank of New Zealand will, I under-, stand, be placed in. a similar position as to this last condition. Both classes of shares will thus rank as paid-up. The par ' value of the new issue holders will be £5 5s aud £7 108 upon each class of shares respectively, less 33$ per cent, in terms of the agreement; while new New Zealand shares to be issued to colonial shareholders will have a full value of £2 without further liability. It would thus seam thab the shares are practically taken at par on either side, and the New Zealand stock written down to admit of an immediate and contingent contributing assistance to the Assets Company, which otherwise will be absolutely separated from the re-con-structed bank.