COMPANY BALANCE SHEETS.

Otago Witness, Issue 3613, 12 June 1923, Page 32

COMPANY BALANCE SHEETS.

BANK OF NEW ZEALAND. Dividend. Gross. Net. Preference. Ordinary.

Interest on guaranteed stock, 4 per cent, each year. The annual report just issued reveals a shrinkage in the gross profit of £263,214 from, la-st year. On the other side, rates ana taxes have almost entirely caused a reduction in expenses of £134,810. On this occasion, the first for a number of years, it has apparently not been considered necessary to write anything off bank premises and furniture. This makes a further diminution in charges of £50,000, with the result that the net profit works out at £78,404 below that of twelve months ago. It is, however, amply sufficient to pay the 10 per cent, dividend on both classes of preference shares, and allow the customary 13J per cent, to the ordinary shareholders. Barely enough to enable £150,000 to be added to reserve fund, the balance brought forward has to be called upon to make up the deficiency of some £9OOO.

Although at first sight the reduction in profit may seem formidable, the net result approaches more closely the proportions of 1918, and the years prior thereto. It has to be borne in mind that the capital has increased during the interval by over 70 per cent, through the calling up of £500,000 from the ordinary shareholders, and the capitalising of £1,125,000 of reserves, which then exceeded the paid-up capital. Thus on an enhanced figure, to-fifths only of which consisted of actual cash subscribed, the ordinary dividend is being more than maintained. In the case of the “B” preference shares, which the transfer increased by 150 per cent., the dividend has risen also.

For the fifth year in succession, the sum of £150,000 has been transferred from protrts to reserve fund. This account, which was cut down by nearly one-half in December, 1920, is showing a steady growth. Of late years the balance forward has swollen to large dimensions, from £111,595 in 1917 to £121,957 in 1323. This surplus may be retained for certain purposes in the near future. Here are the reserves (including the carry forward) shown in relation to the paidnp capital:

In addition, there is the specific reserve for taxes, £426,000. As in previous years, this remains unaffected, the taxes having been met out of profits. Notes in circulation are up by £270,000 approximately. This figure is short of that of 1921, and far short of that of the prior year. This rise may reflect a, better state of trade conditions, necessitating a larger issue. A comparison with the asset of coin, cash balances, and deposits with bankers' works out thus:

Deposits keep in step with the note issue and show a ri3e, which, although not regaining the level of reoent years, is welcome as an indication of improved conditions. Concurrently there appears a substantial decrease in advances, bringing the two items relatively to a more normal position. When it is considered that at March 102-2, the total advances bv Xsw Zealand banks exceeded their deposits by over six millions, it is gratifying to learn that our premier bank can show twelve months later deposits approaching double the total of advances. During the last six years the course of these two headings has been as follows: Advances, etc. Denosifs. tw

r 111I 11 , 0 . f^ cm bills payable, including- other liabilities, has altered comparativelv little As this heading comprises provision “for contingencies, the exact amount of the bills payable cannot be ascertained. Cash and bullion are nearly one million pounds higher than last year, and when money at call and British securities are added, the increase is in the neighbourhood of three millions. New Zealand Government securities are practically unchanged, but municipal and Australian Government securities taken together are larger by £\ 112 403 Notwithstanding that nothing has been written off bank premises at this time, these with landed property stand at only some £12,000 higher than last year. The profit and los3 account, which gives rnore detail than is usually to be expected from banks, discloses increased salaries and allowances more than balanced bv decreased general expenses. Bates and taxes at £4-10,671 are greatly diminished, and are mamlv responsible for bringing down charges by £'134,810. The -smaller items of directors’ remuneration and audit expenses have risen The total assets at £45.306,116 are nearly two million pounds more than twelve months ago. Money which then was employed in advances is now represented bv cash, bills, receivable, and investments. When the liabilities and the preference capital are deducted from the above total, there is a balance of £5,100,000 approximately to show for £2,250.000 ordinary share capital. Yet these shares noW exchange hands in the rnarket at over three tiro's their par value, demonstrating the confidence the public has in the Bank of New Zealand. Since the shares were subdivided into £1 each (fully paid), inducement has been given to the email investor to become a shareholder, so that the institution raav he in realitv the “People’s Bank,” whose prosperity is indissolubly bound up with the well-being of the great majority of the community.

March 31. Profit. Profit. £ A p.c. B 1018 ... 1,100.441 336,006 10 15 1919 1,217,153 388,021 10 15 15 1020 ... 1,376,838 419,045 10 174 llh 1021 ... 1,844,017 777,255 10 10 18;\ 1022 ... 1,800,255 632,042 10 10 1923 ... 1,540,041 553,638 10 10 13£

Reserves. Paid-up Capital. Per cent. £ £ 1017-18 ... ... 2.345,702 2,270,988 102.83 1018-10 ... ... 2,400,224 2,279.088 100.48 1919-20 ... ... 2,646,250 2,627,441 100.72 1020-21 ... ... 1,886,275 3.004,088 48.30 1021-22 ... ... 2,105,818 3,904.983 53.92 1922-22 ... ... 2,246,937 3,904,988 57.54

1017-13 Xotes. £ Coin, etc. £ Per cent. ... _. 3,312,983 5.500,385 60.23 1918-19 3,728,249 5,918,455 62.39 1919-20 ~ 5,765,337 8,371,535 68.87 1920-21 ... — 4,741,492 5,925,791 80.01 1921-22 4,294,230 7,427,410 57.82 1922-29 4,564,695 7,974,011 57.24

Auvuuces, etc. .Ucposits. Per cent. 1917-18 £ £ ... 16,466,493 30,437,936 54.10 19181919- ... 1920- ... ... 17,388,787 ... 17,928,615 ... ' 27,725,874 31,716,353 37,661,610 34,475,655 54.83 47.61 80.42 1921-22 ... ... 23,312,130 28,G7S.G03 81.29 1922-23 ... ... 17,746,718 30,003,926 59.14