NATIONAL BANK OF NEW ZEALAND

Otago Daily Times, Issue 22632, 25 July 1935, Page 11

NATIONAL BANK OF NEW ZEALAND

ANNUAL REPORT (From Our Own Correspondent.) (By Air Mail.) LONDON, June 29. The profit and loss account of the National Bank of New Zealand for the 12 months ended March, 1931, reflects the slight improvement that has taken place in New Zealand business conditions, for the gross profits have risen from £528,400 to £547,278, and the net profits from £95,674 to £102,949, but it is otherwise with the balance sheet, the total of which has been reduced from £22,166,932 to £18,130,841. This reduction, however, is due mainly to the establishment of the Reserve Bank, which, among other things, has taken over the note issue and the financing of the Government. Thus the- note circulation has dropped by £959,462, deposits by over £2,000,000, while the item New Zealand Treasury bills and a special loan to the Government, which stood in last year's balance sheet at £6,503,171, has disappeared. On the other hand, investments in British Government securities have risen fora £978,674 to £1,713,499, while "cash at banks and money at call" has inceased substantilly fom £733,090 to £1,945,958. TRANSFER OF FUNDS. Owing to the impossibility of employing profitably in New Zealand the large amount of money which the New Zealand Government had formerly borrowed, the directors decided to bring Home some of these funds for employment in London. This is the explanation of the fact that the board has transferred £500,000 from the currency reserve to exchange and contingency account to cover the cost of transferring capital from New Zealand to London. This provision is necessary because the New Zealand pound stands at a discount of over 20 per cent, in terms of sterling, but, of course, it would be released on a reverse movement of funds, or if the New Zealand pound recovered to its old parity with sterling. The dividend for the past year is again 4 per cent., tax free, and the sum carried forward is raised from £100,416 to £115,306.