NATIONAL BANK OF NEW ZEALAND.

New Zealand Mail, Issue 1746, 23 August 1905, Page 42

NATIONAL BANK OF NEW ZEALAND.

ANNUAL MEETING. (From Our Special Correspondent.) LONDON, July 8. The thirty-third ordinary general meeting of the National Bank of New Zealand was held in London last Tuesday at Winchester House. Mr Robert Logan, who presided, said the Board were again able to present a very satisfactory balance-sheet, and to maintain dividend and bonus paid last year. On the whole, New Zealand enjoyed a very prosperous year, and there were few indications that this order of things would be changed in any material particular during the current twelve months. For the most part, all colonial trading and industrial enterprises were working satisfactorily.. Farmers and graziers had had a specially good year. The progress of land settlement continued, and with this progress the volume of imports and exports must go on growing. It was just possible that land values were rather inflated, but the general conditions were so favourable that lie did not anticipate any serious set-back at present. Turning to the accounts, he said that the reserve fund stood at £210,000. Their deposits and deposit accounts showed an expansion of £175,000, chiefly in interest-bearing deposits, and their bills payable an increase of £47,000. On the other side of the balance-sheet their coin, bullion, and cash had advanced by £146,000. Their investments also exhibited the usual increase, the result being that they held nearly £1,100,000 in cash and investments against liabilities to die public not much in excess of £3,800,000 —a very satisfactory percentage'. As regards the profit and loss account, the charges had grown by about £3OOO. The profit showed a reduction of about £IO,OOO, about half of which was real, and the balance an addition to the amounts which they had hitherto been in the habit of placing to their internal reserves. The real reduction in profit had been the result of two factors —first, an allround rise of $ per cent, in deposi rates, and, secondly, a disruption or British exchange rates, which, in conseeueuee cf the action of one or the Australian banks, came into opeiation last October. But for these unavoidable causes the profit would have exceeded the figures of the previous year. The deposit rates had again fallen, and efforts were being made to restore the exchange rates to figures which would give the hanks a fair profit instead of, as at the present, hardly any profit at all. It was proposed to add £20,000 to the reserve fund, raising it to £230,000, or within £20,000 of the paid-up capital. They had hitherto invested all their reserve fund outside the bank, but, having regard to the amount at which it now stood, it was’a matter for consideration whether they required in future to place such large amounts to their published reserve fund, and whether it was necessary or advisable to invest the whole amount outside the bank’s business. With regard to the dividend of 10 per cent, and the bonus of 2 per cent., the shareholders would undei’stand that the bonus would not be repeated unless the board felt they wer.e fully justified in paying it. The directors further recommended that a grant of £3500 should be made to the pension fund. BLe felt great confidence

in the future of the bank. Their business was sound and increasing. In th« space of ten years they had built up a large reserve fund, they held an adequate amount of coin and bullion, and they believed that, rapid as had been the bank’s progress in the past, it would be fully maintained, and surpassed in the future. He concluded by moving the adoption of the report, which was seconded by Mr E. C. Morgan. A short discussion followed, in the course of which Mr Conquest expressed his disappointment at the growth in the expenses, and said that, in view of their losses in the past, the shareholders wei*e hardly receiving the consideration at the hands of the directors to which they were entitled. Mr Moss Davis said that he was satisfied that the shareholders would not object to the increase in the expense? if the development of the business justified it. He believed that the bank was in its infancy. Nothing could stop the progress of New Zealand. The report was adopted unanimously, and the dividend and bonus agreed to. An extraordinary general meeting followed, at which the chairman moved a resolution to the effect that each of the 100j000 unissued shares of £lO each should be divided into two shares—one of £7 10s and the other of £2 10s. He

reminded the shareholders that, owing to losses several years ago, certain amounts were written off the bank’s capital, with the result that the nominal value of the issued shares was reduced; f'-om £lO to £7 10s each. Probably because there was no immediate prospect of dealing in any way with unissued shaves, their nominal value was left unaltered, so that the capital now consisted of issued shares and unissued shares of a different nominal value. For some time past the question of increasing the capital had occupied the board’s attention, and although no decis’on had yet been arrived at, it was deemed advisable to take the necessary steos to make the unissued shares conformable in denomination with the issued shares. At a confirmatory meeting a further resolution would he submitted, whereby 90,000 of the 100,000 £2 10s shares would be consolidated into 30,000 £7 10s shares, and the reuTainder cancelled. Replying to questions, the chairman said that if more capital were issued it would be offered, in the first instance, to the shareholders. The resolution was carried unanimously.