BANK OF NEW ZEALAND.

New Zealand Herald, Volume XL, Issue 12240, 8 April 1903, Page 5

BANK OF NEW ZEALAND.

By Telegraph.— Association.—Copyright. Sydney, April 7. The Sydney Morning Herald thinks that New Zealand should wisely reduce the amount of guaranteed stock of the Bank of New Zealand, and thus abandon public connection with the Bank. The Herald regards the recovery of the Bank not as due to State supervision but to State aid, and such assistance as comes from possessing a Government account. Even with this measure of support, however, there is nothing remarkable in the progress made. If the Government began to issue paper ii; would be to suggest a new source of weakness to the colony's creditors at Home. [BY telegraph.-— correspondent.] Ohristchurch, Tuesday. Referring to the Premier' remarks" regarding the future of the Bank of New Zealand, the Press says:—"There has been a good deal of rather wild Falk among irresponsible persons about the Government taking over the Bank, converting it into a State Bank, 'and so forth. We are glad to sue that the Premier, although he is not quite so explicit in regard to the intentions of the Government as he might be, gives no support to any such crude, not to say dishonest, suggestions. The Bank of New Zealand is the property of its shareholders. Parliament has no more right, either legally or morally, to 'take it over' without the consent of the shareholders than it has to seize the National Bank, or, indeed, any private institution or business is any part of the colony. It is quite tree that Parliament came to the assistance of the Bank of New Zealand at a most critical period of its history, and no doubt saved it from collapse by the guarantees referred to. Mr. Seddon, we observe, complains thaib the Government have not received sufficient credit for their action on that occasion. For our part, we have no hesitation in saying frankly and unreservedly, that it was a 'bold and statesmanlike action, which has been amply justified by the results." The Press points out, however, that the guarantee was given, not so much for the sake of the Bank as for the sake of the colony, for if the Bank had gone down, practically every institution and ind&vidnal in the colony would have suffered. The paper continues : — "It is monstrous to suggest that because the colony gave the guarantee, that it is now entitled to convert the guarantee into shares of the Bank, as has been coolly proposed by some of the irresponsible persons, to whom reference has been made. The Acts of Parliament which authorised the guarantees, both in respect of the two millions and the Assets Board's debentures, gave no sanction to any 'taking over of the Bank's business, so long as the Bank's obligations are met. The Bank has amply met every obligation laid upon it under the Acts indeed, it has done more than it was ever hoped it would be able to do in the matter of reducing the colony's liability under the guarantee. There is" every reason to believe that if it were given a free hand by the "Legislature, it could raise enough capital to pay off all the guarantees, and establish itself on a firm and sound basis for the future. It may be, however, that it is better on the whole that its emancipation should not be forced on just yet, but that the' colony should continue to act in some such relation to the Bank as it does at the present time, reserving the same kind of control over its affairs.' The article concludes by asserting that one of the most urgent needs in the new arrangements to be made in regard to the Bank is the abolition of the Assets Board, the properties being placed in the hands of the Bank for realisation. That is a point which Parliament ought to insist upon.