BANK OF NEW ZEALAND.

Otago Witness, Issue 3112, 5 November 1913, Page 29

BANK OF NEW ZEALAND.

AMENDING BILL. REPORT OF PUBLIC ACCOUNTS COMMITTEE. WELLINGTON, October 30. . The Public Accounts Committee brought down its report on the Bank of New Zealand Act Amendment Bill. The Chairman (Mr Hine) said that th® clause providing for a sinking fund wai struck out. The provision that in the event of the winding up of the bank the a.’aeti and reserved stock shall become the property of shareholders, was struck out, as tire interests of the State wore already p;o----served by legislation. A new clause waa added providing for vetoing the useinar of reserve funds for the purpose of paying dividends unless the consent of the Minister of Finance is first obtained. The honorarium of directors had been increased from £2OOO to £3OOO, and proxies were limited to 500. Sir Joseph Ward stated that he was surprised that the Committee had met that morning in the unavoidable absence of t’ha Minister of Finance, who was indisposed. A Bill of the vast importance of the Bark of New Zealand Bill should not have been, gone on with in the absence of a Minister. Dr Newman said that the Bill had been before the committee quite long enough, and it waa quite time a move was made to pass it.

The Prime Minister agreed with Dr Newman. The commercial community and the people generally wero awaiting the passing of the Bill w;th considerable interest. Mr Craigie suggested the setting up of a Roval Commission representing the commercial, agricultural, and industrial interests co inquire what could bo done to better tho banking system of the dominion. At tho present time there were 40 millions of money deposited in banks which did not earn one penny of interest. He moved an amendment to the committee’s report aa above.

Mr Buddo seconded the amendment, contending the future would see a large increase in trade, and a review of the whole position of financial institutions was nacessary. * - Ur Newman said our arrangements with the bank were exceedingly unsatisfactory, and he had a lot of sympathy for Mr Craigie's amendment. He favoured tho setting up of a Royal Commission to investigate tho banking conditions. If he had his way ho would buy out the whole of tho shareholders and hold tho bank for tho State. No doubt his sentiment® would cause consternation among his political friends, but he recognised that this was a revolutionary age and a revolutionary country. The State now owned one-third of the -bank and it should own the whole of it.

Sir Joseph Ward disagreed with Dr Newman’s suggestion. He stated that in nin® eases out of 10 the Bank of New Zealand was lending this couritry its own money. In his opinion the legislation now beforo the House should not bo hurried. He did not say it should be deferred, but haste was unwise. They should be calm and careful. Friction existed between the bank and the shareholders, and he thought it w'ould be a wise thing for the country to own the bank right out, paying the shareholders fully what they were entitled to, but ho did not believe that they could do that in a hurry. That it could bo don® with safety was beyond all question. Mr Ell endorsed Sir Joseph’s injunction to rofra,in from haste in banking legislation. He moved a further amendment to set up a Select Committee' this session instead of a Royal Commission. Mr Russell said he believed that if Mr Craigie’s amendment were carried a serious hardship would bo imposed on the work of the bank He at one time believed it would be a good thing to convert the bank into a State bank, but now ho had serious doubts on the matter. Mr Hanan favoured the formation of a State bank sepax-ate from any existing institution. He also agreed with the suggestion to secure information concerning banking institutions. On a division Mr Ell’s amendment wo® rejected by 45 to 13, and Mr Craigxe’e was defeated by 41 to 21, the committee’s report being adopted.