BANK OF NEW ZEALAND.

Southland Times, Issue 2116, 14 May 1875, Page 3

BANK OF NEW ZEALAND.

The half-yearly general meetine of the proprietors of the Bank of New Zealand was held in Auckland on the 29th ult, The Hon James Williamson, M.L.C , chairman of directors, presided. D. L. Murdoch, Esq., the inspector, read the advertisement convening^ the meeting, and also the minutes of the last half-yearly meeting, which were confirmed. EEPOET AND BALANCE SHFET. The following report and balance sheet were then read : — Twenty-geventh Report of the Directors of the Bank of New Zealand, to tho half-yearly general meeting of the proprietor?, held at the Banking-house, Auckland, on Thursday, April 29, 1875. The directors are enabled again to meet ihareholdera with a report and balance sheet irhich cannot fail to be satisfactory. The net profit at 31st March, after making very full allowance for all bad and doubtful dependencies, and towards reduction of Bank premises and furniture accounts, amounts to £48,058 4 10 To which has to be added balance of undivided profit at 30th September, 1874 13,916 6 3 The following appropriation of which is now recommended : To payment of dividend at the rate of 10 per cent, per annum £30,000 0 0 To bonus of 5s per share, equal to 5 per cent, per annum ... 15,000 0 0 To balance carried to profit and loss account 16,974 11 1 £61,974 11 1 The dividend and bonus will be payable at the head office, Auckland, to-morrow (Friday), the 30th April, and at the branches on receipt of advice. For the Board of Directors, JAMES "Wiiliamson, Chairman. Aggregate Balance Sheet of the Bank of New Zealand, at 31et March, 1875, including London Office to 31st December, 1874. De £ »• d - Bank Stock 600,000 0 0 BeserreFund 180,000 0 0 Notes in Circulation 468,420 0 0 Bills Payable in Circulation ... 1,450,368 0 6 Deposits and other Liabilities 3,884,117 15 3 Balance of Profit and Loss, at 30th September, 1874 13,916 6 3 Net Profit for half-year ... 48,058 410 £6,644,880 6 10 Cb £ s - d " Coin and Cash Balances ... 507,403 011 Bullion on hand and in transitu 250,664 12 10 Government Securities ... 300,000 0 3 Landed Property, Bank Pnmises, and Furniture 102,620 1 3 Bills Eeceivable and Securities in London 1,477,029 8 6 Bills Discounted and other Debts due to the Bank 4,001,163 3 4 £6,644.880 6 10 Pbofit asd Loss Accottjtt. £ s. d, To Dividend at the rate of 10 per cent per annum ... ... 30,000 0 0 To Bonus of 5s per shave, equal to 5 percent 15,000 0 0 To Balance carried to Profit and Less, New Account ... 16,974 11 1 £61,974 11 1 £ s. dBy Balance of Profit and Loss, at 30th September, 1874 ... 13,916 6 3 By Net Profit for half-year, after writing off bad debts ... 48,058 410 £61,974 11 1 Ebseeve Ftm>. £ b. d. To Balance 180,000 0 0 By Balance from last statement 180,000 0 0 The Chairman said : In moving the adoption of the report and balance sheet which have just been read it devolves on me to make a few remarks on matters connected with the business of the past half-year. I need not comment on the report, which I am sure will commend itself to shareholders generally, and will only take notice that one gratifying feature in it is that, notwithstanding the initiation of a policy by other Banks on which I will remark hereafter, which is calculated to interfere materially with banking profits, we are enabled to meet you with the same dividend and bonus, and to add something to the balance to be carried forward to the next half-year. In view of the possibility of the continuation of the competition now existing, the directors consider it prudent to keep a good balance in hand, which may possibly be needed in the future to equalise dividends. The policy to which I have referred, and with which most of you are no doubt more or less acquainted, waß the offer by the National Bank of New Zealand of rates for deposits much in excess of those previously current, which were of course adopted by the other Banks, and subsequently were increased by the Bank of Australasia. Previously to thiß step being taken, the Banks acted in concert as to rates, but, on the pretext of forcing us to join in a general agreement in Australia, the bank I have laat named withdrew from, and consequently upset, the agreement in the colony. At the first sight it may appear as if their position was not unreasonable, but when I tell you that our business in Australia consists almost wholly of our own agency business and dealings in exchange, it will at once be apparent to you that to join in the same agreement as the other banks have for general business would practically be consenting to close our Australian branches. As there appeared no prospect of a return to an agreement here, there was nothing for it but to carry the war into our adversary's stronghold : but, before doing so, a renewed attempt was made to bring about an. understanding, but without Buccesa. We therefore offered in Melbourne the same rates as were being publicly offered here by other banks, and though this action has been severely and very unjustly commented on by aome portion of tho Australian press, you may take our aiiurance that it is not working or likely to work to the disadvantage of this bank. I need scarcely tell you that the offer of the present extreme rates for snoney is

altogether foreign to the policy we would desire to adopt, and I am sure subversive of the best' Interests of the colony ; for though it gives depositor-! a present advantage, it withdraws mon^y from the ordinary channels of business, and inevitably leads to correspondingly high rates for advances. This has not yet beeD much felt, the competition between the banks keeping down lending rates, but the time will come when the banks will try to make up for the present low scale of profits, and I hope the commercial community will then remember that the pinch has not been caused by this bank. The figures in the balance sheet require little comment from me ; they prove satisfactorily that the business of the bank is being well maintained, and before sitting down I will only add that in conBequence of the maintenance of high prices for wool and a most abuudant harvest, the trade of the colony is in a very i buoyant condition, while the late successful negotiation of a further loan by the Colonial Treasurer gives assurance that his scheme of public works will continue to be vigorously prosecuted. I have \ pleasure in moving that the report and balance sheet as read be adopted. Mr Murdoch, in reply to a shareholder, said : I may say at once, that, in the ( recent action taken by the bank in Australia, no such object as that alluded to by Mr Prime in any way influenced the directors. They were simply actuated by a desire to bring about, if possible, a better understanding between the banks, by convincing them that the Bank of New Zealand was in as good a position to make them pay for deposits in Australia as they were to make it pay here. (Hear, hear.) But as to the statement itself — that we were attempting to attract Australian capital to New j Zealand — I think we might very reasonably retort the accusation, and say that the primary cause of the recent competition svas a desire on the part of foreign banks to attract a portion of the capital now at use in New Zealand to Australia, for the representative of one of the foreign banks, and one of those that took the first action in this competition, publicly stated that he had instructions to withdraw £200,000 of capital which he had at use in the colony, that he could only do so by squeezing bis customers, or by getting depesits, and that he had determined to zealously carry out the latter policy. Now, if we had allowed him to withdraw .£200,000 of deposits from other banks by the offer of high rates, the other banks would simply have been disabled from meeting the ordinary requiremenls of their customers, and the money so withdrawn would have gone to Melbourne to meet his bank's wants. This, I may say, is one of the inconveniences to which a colony is exposed in dealing with foreigu institutions, one day expanding and another day contracting their business, not, perhaps, from any local cause, but simply in consequence of a liability or necessity that arises in another quarter. I think New Zealand has previously experienced the incon venience, and this is but a repetition. But the accusation is only one of many I have seen in priut lately, since I was in Australia. Another charge was that we were squeezing our customers. Now, I fancy that shareholders and customers of the bank are better judges of this than scribbling letter winters ; and I think we may safely challenge any one to say that reasonablo accommodation has been refused to any one deserving it in the colony. I feel quite sure it has not been so. I hope shareholders generally, if they see such reports repeated, will treat them with the contempt they deserve, and look upon them merely as so many weak inventions of the enemy. (Hear, hear.) The Chairman, in reply to a shareholder, stated that the branches in Australia had not gone into actual banking business. They were simply accessories of the bank in New Zealand J to enable it to do the business it required to transact in the colonies to the best advantage. The Chairman referred to the influence for good that bad been exercised on the colony, both north and south, by the Bank of New Zealand, and expressed his belief that it would not be forgotten. The motion for the adoption of the report and balance sheet was then put and carried unanimously. The usual vote of thanks to the directors and officers of the bank was put and unanimously carried. The Chairman, in returning thanks on behalf of the directors, intimated that the late Governor of New Zealand, Sir Jaa. Fergusson, had joined the Board. He thought that from the position Sir James had occupied in New Zealand, and the knowledge he possessed of it, his name was likely to add to the standing of the institution. Mr Murdoch acknewledged the vote of thanks on behalf of the Btaff. This closed the proceedings, and the meeting adjourned.