RESERVE BANK ACCOUNTS

New Zealand Herald, Volume LXXIV, Issue 22779, 13 July 1937, Page 8

RESERVE BANK ACCOUNTS

The accounts of the Reserve Bank ] of New Zealand for the second full year of operation show a net profit of £147,142, against £98,0i2 for the preceding 12 months. The only other period for comparison is the eight months from August 1, 193!, to March 31, 1935, when the net profit was £28,854. A full year's dividend of £25,000 was paid to the shareholders in each instance, leaving the balance (o go to the Consolidated Fund. There is no such deduction from the net profit returned for 1936-37, though there is a liability for interest on the stock issued in redemption of the share capital. However, in assessing gains and losses, another important factor must be counted. Against the profit available to the Consolidated Fund must Ite set the taxation collected on the old note issues of the trading banks, now extinguished. It became a diminishing sum as soon as the Reserve Bank opened in 1931, and ceased altogether on August 1 last year, when the remaining issues of the trading banks were taken over. A comparison of the Reserve Bank profit available to the Government and the note tax is shown in the following table: — Profit available Note tax 1933-31 . . 1934-35* . . £3,8.11 218,017 1935-36 . . 73.012 31,389 1936-37 . . 147,142 *Kight months. In the first year quoted, the Reserve Bank had not started. In 1931-35 it operated from August to the following March. In 1936-37 there was some note tax payable between April 1 and July 31, but the amount has not yet been shown in the public accounts. But, incomplete as the comparison is, it proves that there has been an actual loss and no profit to the Consolidated Fund by the operations of the Reserve Bank.