BANK OF NEW ZEALAND.

New Zealand Herald, Volume XLIII, Issue 13226, 11 July 1906, Page 2 (Supplement)

BANK OF NEW ZEALAND.

.— - ■»'-•••' ■ ■ ANNUAL MEETING OF SHAKEHOLDERS. " ' A PROSPEROUS YEAR. The annual meeting of the. shareholders of the Bank of Now Zealand was held in Wellington on Friday, June 29. The chairman (Mr. h" do C. Maict) presided. . The annual report of the director* for tho year ended March 31 last showed that the profits, after providing- for.expenses of management, all bad and doubtful debts in tho bank's current business, and making provision for the annual donation to the provident fund and for a bonus to tho staff, were £330,329 14s 3d. From this has to be deducted interest on guaranteed stock £40,000, leaving £290,329 Its 3d. Of this sum the directors had allocated £16,000 14s 3d as under:—ln reduction \ of the Bank of Now Zealand premises and furniture, £15.500 14s 3d; in reduction of Colonial Bank premises, £500: tola!. £16,000 14s 3d, leaving a balance of profit totalling £274.529. This the directors had disposed -of as follows:—Statutory payment to the Assets Realisation Board, £50,000; provision for dividend at the rate of 5 per cent, for tho Year ended March 31, 1906, on £500,000 perference shares, issued to the Crown in terms of the Bank of New Zealand Act, ; 1903, £25,000; provision for dividend at the rate of 5 per cent, foi tho year ended March 31, 1906, on £500,000 ordinary share capital, £25,000; surplus paid to the Assets liealisution Board m terms of the- Bank of New Zealand Act-, 1903, Clause 15 (including £3482 Is Sd on account of income tax 011. debentures), £174, 328: total, £274,329. In moving the adoption of tho report and balance-sheet, the chairman referred to tho increase of capital to £2,000,000 by the sale of forfeited shares and payment of arrears of calls, and also to the increase of the reserve fund to £57,786 16s 3d. Reference was made to the increasing business of tho bank, and the chairman proceeded to refer to thequestion of profit and loss as follows: — After making provision for the customary items this year, as .last, viz., expenses of management, bad and doubtful debts, donation to the provident fund, bonus to staff, and £40.000, the interest on tho guaranteed stock (£1,000,000) the balance of net profits for this year amounts to £274,329, as compared with £253,930 on March 31. 1905. As an indication of the steady progress of the bank during the last five years, I may here mention that the balance of net profits for each year during that period has been:— „ ■'■•' £ For 1502 ,„.-■ .„ ... 172.501 5903 „„ »„ ... 195,590 1904 ,„ a.. ... 200,303 1903 ... .... ... 253,930 ' 1906 ... ... 274.329 It will be of interest to shareholders to recapitulate tho amounts appropriated out of profits, since 1895 towards clearing off deficiencies and paper assets in the balancesheet, and strengthening the position of tho bank. .--.-■ '.;".-''-''',".'.' After meeting all expenses of management, and making full provision for every debt of a bad or doubtful nature, and including the ' figures in the - balance-sheet now before you, the following sums have been allocated: — To. Assets Realisation Board—,* ", Statutory payment- of £bO,Cda- _ per annum .. , ... .- ...... .£550,000 To Assets Realisation. BoardAdditional payment, being bal- ' - ance of profits .. „• ... ; 655,'07 In reduction of assets in Ikxuidar t i- 0n - r- ,-." -, • 139.988' In effacing from balance-sheet " deDenture conversion .account"... 63,445 In writing off. ■"'. Oolqnial Bank goodwill account" ... ,',. .... ... 75,000 In reduction of Colonial Bank. property and premises ... .'..'•... 25,000 In reduction of our own Bank property, premises, and furniture... 99,805 ■ ~£1,643,445 When tho Assets Realisation Board was setup in the year 1895, the book-value of the property handed over by the bank to the Board was £2,680,285, for vhich debentures, bearing interest at ■3£ per cent, per annum, for a corresponding amount guaranteed by the Government wer* issued by the Board to tho bank. In his address to thaveholders on September 6, 1895, the then president of .tho bank stated that tho t.e>fieieney in the assets to be taken over ■' by the Board was computed at £850,000. The first charge on the profits of tho bank when the Assets Realisation Board was constituted by Act of Parliament was a statutory payment of , an annual sum of £50,000 towards the deficiency referred to. After payment of a dividend to the shareholders of the bank not exceeding 5 per cent, per annum on tho paid-up : capital, the statute provided that the residue of the net profits was also to be paid to the Assets Realisation Board. . ■ ;-I have compiled the -following statement from the information supplied to me by the general manager of tho Assets Board. His figures show the valuations and position of tho account as on March 31, 1906. From the amount of tho debentures unredeemed at that date, £1,025,000, I have deducted the stun of £170,500', appropriated towards further redemption of debentures out of the surplus profits of the bank since paid over to the Assets Realisation Board, tints reducing the total amount of outstanding debentures'at this date to £855,000: — ■':".'' •-■£ £ . Station lands ... 287,624 Sundry properties... ,-«.' ... 125,505 413,527 Stock, produce on band, and sundry assets 309,604 Mortgages and balances due by purchasers 370,266 Revenue accrued at March 31. 1906. estimated ... ' 3,569 N.Z. Thames Valley La.nd Co., anticipated final dividend ... r 2,512 ■ . -- ■ "mm Bank overdraft ... , 57,656 Less statutory -payment by .. Bank of New Zealand ~. ' 50,000 ' '. —" 7.656 . .■'■'.' ; "- ■'. -, "■ -'-~ 291,322 Debentures outstanding ■ at • March 31. 1906 .;:, ... ... 1,025,000 less, debentures since redeem- ' ' ed out of surplus profits of ' the Bank ... .... ... ,_ 170,000 - ' - --.- . , ——— £55,000 Showing an estimated surplus of assets over outstanding de- ... bentures of ... ..... ... 36,822 You will notice that the surplus profits of the bank have been paid over this year to the Assets Realisation Board before, instead of as in former years after, the annua! meeting. These moneys, as you are aware, under any circumstances must- by. statute be handed over to that body. This course was adopted on the present occasion, as the directors desired to have a valuation of the assets remaining in the hands of the Board, having reason to believe that tiie surplus profits of the year would more than cover the estimated deficiency of £158,882, as re-ported-to you at the last annual meetingThe- directors have taken action iii terms of clause 22 of the Bank of New Zealand Act, 1903, to cause a valuation to be made at the instance of the chief auditor of /-he properties now vested in- the Asset* Board, and the actual deficiency,between such value and the amount of the outstanding debentures, with, the interest due, or accrued due thereon, to be ascertained.. After a brief discussion the motion for the adoption of the report and balancesheet was carried. * The Chairman announced that the dividend would be payable on July 12 or on re ceipt of the necessary advice.