BANK OF NEW ZEALAND

Otago Daily Times, Issue 16873, 9 December 1916, Page 13

BANK OF NEW ZEALAND

HALF YEARLY MEETING. (Pes United Press Association.) WELLINGTON',' December 8. Tho half-yearly meeting ot Uie Hank. it New Zealand w<us nelu to-dsiy, iVlr iitiroul Beuueliamp (chairman ot directors) presiding. alio Chairman, after a feeling reference to the deatn ot Mr Martin Kennedy, who hail been closely ldentilied with Uie bank tor tile past 22 years, and tlio appointment of Air K. \V. Kane as sliareliohlers' representative oil tile board in place ol Air Kennedy, proceeded to take a cursory review of tne leading features of tile present tinanciat and industrial position. in tho course of his acluress lie said: 1 may remark that in this dominion producers continue to experience a period of phenomenal prosperity, and our staple products are realising prices which, it may bo said, have never before been obta.ned m tho history of the country, Since early in 19i3, tlio dominion's meat output has been purchased in the interests ol the imperial (jovermncnt on a fixed and remunerative basis as to prioes, and Uie arrangement has recently been renewed till Uie end of the war oil somewhat more favourable terms to tho producer. A portion of the cheese output tor last season was also purchased on behalf of the Home authorities, and arrangements have recently been made to similaj'iy take over the dominion s wool clip lor the coming season. Throughout the whole country an exceptionally lavourable season has been experienced, and tho yield ol every description of produce promises to be bouutilu.. The area of arid under crop is somewhat restricted this year owing, to some extent, to the difficulty that is being experienced in obtaining the necessary labour to cultivate the land and harvest the crops, and also, in a measure, to the relatively higher prices ranging for meat and wool. It is to be feared that the high yield for meat is inducing prodigality in the slaughter of stock, and there is reason to apprehend that our flocks and herds are being reduced in numbers to such an extent that tho adequate stocking of our pasture lands will, in tho near future, become a very difficult problem for our farmers. More especially is this remark true in the case of cattle, of which class of stock a moro than ordinary number of young beasts arc finding their way to the Blaughter-hoiise. Lambing has generally been good for the whole country, and this, in some measure, will compensate for the excessive drain that has been taking place upon our sheep ,stock. The state of trade and business throughout the country is, on the whole, good. The excellent prices which have been realised for the past two years for our staple products and the largo expenditure of borrowed money that is in progress m connection with tho training and equipment of our troops for oversea service, has placed tho people generally in an easy position in regard to resources, and they are displaying the usual liberality, if not prodigality, in the expenditure of tho abundant funds that , they have available. Traders in luxuries, such as jewellery, soft goods, etc., have been doing exceptionally well. Land and agency business is fairly quiet. The building trade is severely handicapped by the shortage of skilled labour and the high prices of materials; and operations in this industry are confincd mainly to necessary works. There is little change to chronicle in the state of the money market. Mortgages still continue to be raised and renewed at rates averaging as a rule 5j per cent, to 6 per cent., and the effect of the £8,000,000 local war loan, which tho Government placed on the market in August last, and which was over-subscribed, has not apparently been to harden the market to any appreciable extent, at any rate in the meantime. Tho cost of living is steadily increasing, and the high prices to which the necessaries of life have advanced are imposing a heavy burden on the wage-earning and ' small salaried classes. Tho Government, with a view of placing a check on tho upward tendency of the price of butter sold for local consumption, fixed, by Order-in-Council,'the maximum wholesale price at which butter destined to be retailed in the dominion should be sold; and in order to compensate manufacturers for any losses they may sustain through selling for the local market instead of exporting, a levy at the rate (at present) of three farthings per pound of butter-fat used, was made on all butter and cheese factories, and the issue of a liccnse to export was made dependent on the payment of the levy. The principle underlying the Government's action is a very important one both to producers and con- „ sumers, and its operation as regards butter will be watched with interest. In sympathy with the increased difficulty of living decently and respectably at tho present time on small salaries, the board recently decided to grant to the bank's officers a war bonus of 10 per cent on all salaries, not exceeding £500 per annum, drawn by married men and by single men who are burdened with the support of dependents. As this bonus has been backdated to Ist April last, and is to continue at any rate till 31st March next, it will, we hope, effect a considerable relief to tho lower salaried officers of our staff in the matter of ways and means of livelihood. I have, no doubt that the board's action will have your cordial endorsement. The trade returns of the dominion exhibit. a very satisfactory position. In each of the two complete produce years that have passed since the outbreak of the war there has been a very substantial increase in the values of the dominion's exports, as compared with the previous year! To show to what extent the dominion has benefited by the very strong demand for its staple products, 1 append a table of the exports and imports (excluding specie) for the two years from October 1, 1914, to September 30, 1916, and also for tho two years immediately preceding the war, namely—from October i, 1912, to September 30, 1914:— Excess Exports. Imports. exports. Wl2-13 ... £23,682,416 £22,8G5..'i. r >4 1013-14 ... 23,7-59,347 21,056,384 Totals ... £47,441,76.1 £43,024,733 £3,517,025 IM4-15 ... 29,710,-M 10,786,224 1015-16 ... 34,026,541 23,701,152 Totals ... £64,636,075 £43,577,376 £21,050,500 These figures show that the exccss of exports over imports for the two pre-war years was £3,517,025, and the excess for the later period, £21,059,599. Turning to tho figures for the year ended September 30 last, namely—exports £34,926,541, imports £23,791,152—an analysis of the export figures shows that tho increase of £5,216,107, as compared with the preceding year, is due mainly to higher values, and not to increased quantities. Tho fluctuations in our main products are shown in tho following table: —

, Quantitv , , Value 1914-15. . 11)15-16. 1014-15. 1915-IC. Lbs. Lbs. £ £ Wool 203,008,118 200,130,179 10,425,172 13,173,908 l'ro/.cn Civ;. Cwt.

meat 3,368,164 3,-153,3-10 7,238,560 7,589,795 liutter 413,987 395,160 2,38,1,308 2,749,039 Cheese 792,075 , 970,84S 2,523,160 .3,446,142

It will bo' seen that all the principal products exported in 1915-16 exhibit an increase in value, though both wool and butter show a. shrinkage in quantity. Imports show an increase in value for the year of £4,004,828. This is a large increase, which in normal times would call for more than passing comment, but under present conditions it is obvious that a <:onsiderable portion of the increase is due to higher values of the goods imported i nd the execution of belated orders. The prosperity of tho country tends to encourage extravagance in expenditure and in methods of living, which in ordinary course results in increased imports; and from that point of view it is perhaps not a bad thing for tho country that inward: shipping facilities are in some measure restricted. Tho banking returns show an eminently satisfactory position. The combined deposits of the banks received from tho public at September 30 Inst-, compared with thns'j of September 30, 1915, were ar- follows: — Sept. 30, S pi. 30, 1915. . 11)16. Increase. Interest baring deposits ... £11.609,006 £12,978,029 £1,303,a63 Xon-intcr:st bearing Ap-jilts 17,515,863 13,020,871 2,071,50S £29,154,523 £32,593,31X1 £3,444,371 Government deposits show large increases,the conse'iueiicc ol the incoming of tue local loan moneys and - large revenues resulting from the taxation imposed under -ihe I- ijianee -Vet, IUID. ,\ol, oreu;;ir< ou snows an expansion of £1,507,146. This is not the result of any increased activity in tin; trade of the dominion, but is oecasjo'i.'d bv the complete suspynrion of gold settlements between the banks; settlements of exchanges being now mack in tile 1eg..l tender notes of the settling banks. Advances also show expansion to the extent of £1,329,059, the figures being as follows :— ■ Sept. 33, Srpt. 30, 1915. 1916. Inctro.ise. TO mounts & 1,357.653 £ 1.42**23 £ 71,145 Advances •• 21,991,222 23,241),136 1,257,914 £23,348,905 £24,677,964 £1,329,059 Sinoe tho outbreak of war no fewer than 369 of .the bank's officers—more than a

third of tho total staff—have joined the military forces. Tho bank granted leave of absence to 329 of these, with half-pny in the case of members of the colonial staff and full pay for members of the London stall', the military pay of the latter being on a lower scale than that of the colonials. The remaining 40 rescued iheir appointments in orl?r to jt-in the army, preferring that euursc lather than to wait their turn to he relieved. Of the officers on leave 1 regret to say that 20 have lost their lives, one is missins n,| d believed to be wounded, and 51 others have been wounded in action. As probably less than 203 of our officers have been in the liiing line, the balance being; still in camp or in 'torsit, this is a heavy toll, and ;t can be judged, that, as a soldier, tho bank cleric keeps well to the fore and taker, his full share of the fighting.

You will. I am sure, join with me in extending heartfelt sympathy to tho relatives of our gailant officers who have willingly given thoi-' lives in the service of King and Country. The difficulty of carrying on our large bus : ncss with a steadily weakening staff is one which is shared by practically every emplover in the country, but the magnitude of our business makes our task proportionately heavier. We have now 200 women clerks at work and aro taking on others. An efficient bank officer, however, is the product of yea.rs of experience, and ho cannot bo satisfactorily replaced by inexperienced clerks. The results of tho bank's work during the half year ended fv-pteinber 30_ last have boon found to be satisfactory. 'J he profits earned justify the usual distribution. An interim dividend of 6 per cent, is accord'n?lv now declared in r°spect of 1-ot.h preference and ordinary shares. Tho dividend will bo payable at Wellington to-mor-row. 9t.h instant, a,nil at branches on receipt of advice Mr Watson - returned th inks for bis rerlect'on to the boai'd, and Mr Kail" expressed his sense of appreciation of the action of tho board in appointing him to (he vacancy created by tho death of Mr MnH'n 'Kennedy.

The Chairman welcomed Sir James Mills, a member of the London board of directors, and expressed appreciation of his services to tho board at a time of crisis. Sir James Mills thanked the chairman for tho welcome, and expressed appreciation of the compliment paid to him by the New Zealand Board in asking him to accept a seat on the London Board. It had not been an uncommon thing for a member of the New Zealand Board to attend a London meeting, but this was probably the first occasion on which a member oj the London Board had attended a general meeting in New Zealand. Referring to the work of the London Board in the war period, Sir James stated that the position was a very anxious one for some days before the declaration of war and for a short while afterwards. until the Imperial' Government was able to formulate a scheme for the relief of the money market. It was, however, no secret that this bank was in a very satisfactory position at the time, and, if matters had turned out worse, it would have been as well able as the older banks to meet tho difficulties. Ho complimented tho chairman on his address dealing with the position of tho bank, and -giving so much valuable information as to the trade of the dominion. This would be very reassuring, especially the figures given of the excess of exports over imports. This was of inter'st to the London Board, as there a tendency for accumulated funds to find their way there. It was the duty of the London Board to'find safe investments, so that the money would not be tied iip, but would bo available for use by the bank if required. He quite endorsed the chairman's opinion that, notwithstanding the clouds hanging over them as regards the state of war and the political position at Home, they could look forward, with confidence to their staying power bringing ■ them that victorious position which all counted upon. It was difficult to forecast tho position after the war. It would depend to an extent upon tho character of the peace made, but there would be difficulties before commercial men and the banks. It would be no easy task for Great Britain to recover the tracle which had been lost or scattered through her attention being occupied with the war and which had fallen into the hands of neutrals, who profited by the great war expenditure on all sides, and who accumulated lai'fjo reserves. These they would use in competition with us, and they would spare no pains to retain and increase the advantage they had gained. We could also look forward to our present enemies making a great bid to recover their trade ;:s soon as the seas were open to them agun It seemed clear that, notwithstan- I '. nr her difficulties, Germany had been able to keep some of her industries going, and had accumulated goods and reserves of raw materials, which would be used to flood the markets when peace came. To meet this situation better organisation and co-opera-tion between tho banks and commercial men would be necessary, somewhat on the lines which had obtained with the Germ-m banks in the long years of space. They must prepare not for to-iiiorrow, but future generations, by tho better eduMti n of young men in banking and commor'' pursuits. They could do this in die reoondarv schools in Great Britain and hire, providing that Latin and Greek simnid take a second place in their system of education. Mr S. Weston proposed that the shareholders express their deep appreo-u-m of the services of the late Mr Martin Kennedy, their regret, at his death and thej'r respectful sympathy with his relative. Mr Weston said he did not think there was anybody to whom the shareholders were more indebted than to Mr Kennedy. From the very first he expressed confidence in the future of tho bank, and any shareholder joining to him for advice was. always encouraged to hold on. One knew that in giving that advice Mr Kennedy was not merely making a statement, but that he was telling others to do what ho himseif consistently did.

The motion was seconded by Mr J. B Harcourt, and was carried in silence.

On tho motion of Mr A. M'lntosh, seconded by Mr F. Dyer, the mooting unanimously expressed its entire approval of the action of tho board in appointing Mr Kane to the vacancy caused by the death of Mr Kennedy.

A vote of thanks to the directors and staff was carried on tho motion of Mr R. B. Jackson, seconded by Mr J. H. Owen.