South New Zealand Finance Company,

Southland Times, Issue 11656, 10 February 1891, Page 2

South New Zealand Finance Company,

The annual meeting of the South New Zealand Finance, Loan, Building and Agency Company was held yesterday even* ing, Mr W. B. Scandrett presiding, and about thirty shareholders being present. The manager (Mr George Trew) read the annual report and balance-sheet, explaining that in the latter as published a oouple of errors had occurred. The balance-sheet was just a summary, he said, of the cash book for the year, nearly two thousand transactions being represented by the few entries placed before the shareholders. In taking out the figures the mistake had been made of putting L2OO to the amount opposite " debentures * on the income sido of the balance-sheet, instead of to "redemption of loans." The total was the same ; the assets and liabilities were correctly stated. He wished to disabuse anyone's mind who thought that the books had been incorrectly kept— he could ▼ouch that they had been honestly kept at anyrate. There had been a small mistake of 3d in the calculations which was scarcely worth saying anything about. The report and balance-sheet (as corrfected) were as follows: — The Directors beg to submit to the shareholders the eighth <thnual report and statement of accounts, and in doing so regret that— owing to the continued depression in the value of house and land properties, the shrinkage of rentals, and the heavy outlay incurred in repairs and renovations — the year's business will not warrant the payment of a dividend. The properties taken over by the Company have now reached ft£large*amount. Many of these at present give but slight returns ; and, as will be seen by the balance-sheet, necessitate a considerable annual cutlay for repairs etc., so as to render them tenantabW and te maintain them in a saleable condition. The directors have carefully gone through the securities with the object of trying to make a new valuation on them, but found their opinions so diverse that, they resolved on making no alterations for the present. They do not consider.it prudent to force sales in the absence of any market, but await a demand which they hope soon to see. From the propitious seasons experienced in this part of the colony for years put, and more especially from the abundant harvest anticipated for our farmers this season, your directors have every confidence that South* land cannot remain long unrecognised as a desirable field for settlement and for the in* vestment of capital ; that a/WMT'era. of prosperity will be established in It thereby, and that they will thus be enabled to dispose of several town and country properties at something like former values, but which at present are producing slight returns for the loans advanced upon them. Several proties have been sold during the year at satisfactory prices, with one exception. The debentures at date of report amount to under L 13,000. Against this the holders have the ample securities of the entire mortgages and properties ; and, in addition, the whole of the uncalled capital, Two directors, Messrs Craig and Campbell, retire, but are eligible for re-election. Two auditors have to be elected by the meeting. ■ Incomk— Debentures, L 13,845 2s Id ; repayments, LI B6B 8s 5d ; subscriptions, L 25 8s ; fines, L 74 10s 9d ; entrance and withdrawal fees, L 4 U6d ; interest and commission, L 720 2b Id; rents, L9591257d; insurances, LlO9 8s "3d; redemption of loans, LB7l 6s 6d ; rente—office iwoperty account, L7B 10s ; properties sold, L 515 0s 6d ; advances repaid, L 1302 16s lid ; Bank of New South Wales, LI 1,290 Its lid ; total, L 31,666 0s 6d. Expenditure— Debentures, L 17.470 Us Id ; advances, L 562 16s 5d ; property account — ground rent office, LB2 12s 9d ; interest on debentures, L 1244 3s lid ; insurances, L 132 19a 2d ; subscriptions withdrawn, L4l ; management—directors, L 104; salaries, L 33 5; auditors' fees, L 26 4s ; printing and stationery, L 6 9s ; advertising, L 39 17s 6d ; property tax and annual license, LI 30 7s 2d ; stamps, gas, and sundries, L 49 10s 9d ; outlay on properties, LIOO7 9s lid ; dividend ended 31st December, 1889, LSOO 5s lid ; Bank of New South Wales, L 9933 13s ; total, L 31,666 0b 6d. Liabilities.— To capital, L 20,012 10s ; debentures, L 12.693 8s Id ; accrued interest, L 241 12s 7d ; subscriptions with profit, LlB9 03 lid ; Bank of New South Wales, L 3303 10s lOd ; interest due bank, LB9 5s ; balance carried forward, L 22 Ul 8d i tot*] , L&&\

Assets.— By repayment loans (present value), L 4973 11s 9d; fixed loans, LlO,Oll 7s ; accrued interest, L 374 16s 3d ; securitia which have fallen in, Ll 3,011 13s 5d ; rent due, L 167 1 3s ; advances secured by bills oj sale, p. notes, and bond warrants, L 4270 4i 4d ; accrued interest, L 556 lls 2d ; advances ?^^1 rity of Ownp-oy'* «h*res and interest, Ll3Ol 7s 2d ; Company's shares held over, L 613 os ; insurance premiums, L 65 ; leasehold office premises, L 1150; ofiice furniture, LSO; total, L 36.551 19s Id. The Chairman said :— The balance sheet and report contains very full information, bat I recognise that shareholders will want ■ome assurance that the position is no worse than is shown by the balance-sheet. Private persons who are at all interested in property and companies of greater magnitude than this one have had much the same experience during the past year or two as we have had. I have compiled some figures to prove to you that the Company's risks are largely distributed over the whole district. All our eggs are not in one basket by any means. The loans now existing and those properties which have fallen in were in the hands of 150 separate and distinct persons. The largest loan is a town one of L3OOO ; there follows one at L 2500 which was reduced by the borrower to L2OOO, and has been written down and stands now at LIOSO ; the two nsxt highest are LISOO ; then two at L 1200; three at LIOOO ; five at L7OO ; three at L6OO ; and then they vary from LSOO down to L 25. The properties that have fallen in number 42 and the highest in value in the balance-sheet is L 1650. Of the Company's loans on properties 40 are in the town of Invercargill ; 20 in the suburban towns of Gladstone, A venal, South, East, and North Invercargill ; 7 at the Bluff, 12 at Mat&ura, 9 at Gore, 6 at Wyndham, 2 at Fortroae, 2 at Wsimea Plains, 6 at Winton ; 3 at Dipton, 6 at Lumsden, on* at Mossburn, one at Lake Wakatip, one at Riverton, one at Thornbmy, one at Drummond, two at Wreya Bush, one at Wairio, two at Otantan, three at Nightcaps, five in the Woodlands district and some at other intermediate Place*. This is a large distribution. It, however, has been found impossible to avoid property falling into the hands of the Company. The policy of the Company has been to get their own without pressing people into the Bankruptcy Court. In on* or two instances, perhaps, the borrowers did not deserve the eoosjderatton they received. The directors' object was to adopt the plan which would result in the least loss. There has been no difficulty with any loan advanced during ta* past three fear*. Of course all properties on which money was lent had at the time a Talue considerably beyond the money lent on them. In no single instance in the balanos-sheet has the value been increased by adding the interest that was due. Since the balance-sheet was prepared satisfactory arrangement* hay* ' been made with two properties, One stood in the balance-sheet at L 368, It has been disposed of for L 395 cash. Another on which L 350 was lent, but which was written down to L 335, besides lost of interest, has been sold for L 350 on the Sfeathly repayment seal*. It is much more satisfactory to be able to earn divid*nds,but private people who devote their undivided attention to their own interest* have not Seam able to get much value out of their properties during the past year or two. Yet, notwithstanding these facts, the present outlook is encouraging. The country district* are really improving in settlement and cultivation. The two transactions I have mentioned belong to the country. As I.stated on a previous occasion we cannot expect a marked improvement, in the towns sjspeciaUy, until the tide of immigration over emigration turns in oar favour. Last year v to November 30th the excess was against itß* epioay as a whole to the extent of 1800 persons. If we- had an increase of only one family a month or twelve families a year to town, which is a small number, you .bee an immediate improvement in the ' value of town property. There would . be a demand for houses, and rents would rise to ;ft fajr, charge. People cannot afford to build house* to let now at the low rents ruling. I did not intend to delay the meeting to this length, but at the same time an explanation of some of the reasons why you do not recefre fhe dividends you formerly received r Was J de*Uable. I move the adoption of the report and balance-sheet. Mr A. Storie seconded the motion. MrF. W. Borne said he had to congratulate the manager on the explanation he had -given in regard to the balance-sheet, but he thought it peculiar that after it had been ~«igßSd by directors, auditors, and the manager it was left to an outsider to be able to point out an error in the calculations. 9* inferred to several minor point* in the balance-sheet, and concluded by expressing rlfeiepißion that it was discourteous for the directors not to have mentioned in their report that since the hut annual meeting one of their number had died and another had retired. The Chairman said he had probably been at fault in not mentioning what Mr Borne referred to in the remarks he had made but there had been no intentional discourtesy. The directors had kept their number at five for economy's sake, and had only drawn fclterdnring the year instead of the L2OB to < - wMoh the wttcles entitled them. ' \, Tne, motion for the adoption of the report and' balance-sheet was then put and carried. The Chairman said the next business was the election of two directors. Mr A. B. Campbell was eligible for re-election but wished to retire to make room for fresh Mood. •* v lir^Oatspbell said he thought it would be l 'b»*t; to infuse a little new blood into the Company, but he would continue to take the r greatest interest in the Company's affairs, ; and had implicit confidence in the directors. ' 'The Chairman said the directors would be < sorry f» Idee Mr Campbell, but they took it as a compliment that he, a large debentureholder as well as a shareholder, showed his confidence by being content to leave his money in their hands. Mr Storie proposed that Mr Walter Henjknsn be elected a director. Mr Henderson declined, pointing out that as a matter of fact the number of shares he c .helddid not render him eligible for election to the directorate. He wished to state that what be had heard during the meeting had ; given him very great relief, especially after tbesjoi respondenoe and the insinuations which had appeared in the Press. The directors , could not be altogether blamed for the fact SsEat enamber of properties had fallen into then* hands. ' Most companies were in the same position, the cause being the inflated ideas as to the value of properties which all held » few years ago. It was gratifying to think that no disaster need be feared, and that if the securities did fall into the hands t4 the Company there would be no serious losses. He believed the directors were entitled to every confidence, and that in a few years they would bring the Company into a most prosperous condition. Item Win. Craig and G. Froggatt were the* WMoimously elected to fill the vacancies on tke directorate. Mr % Perkins announced that he did not intend to seek re-election a* auditor as he believed a change would be beneficiaL He had done his best while holding the position in the past, and he thanked the shareholders for the confidence they had reposed in him. Messrs W. G. Bright, A. Cross, C. W. Brown, and J. E. Hannah were nominated as aaaitors, and a baUot resulted in the clactJoa of Messrs Bright and Cross. Mr Borne moved—" That, subject to the articles permitting it, the management be instructed to prepare a list of shareholders, the number of shares held by each, with the amount of liability attached to each of those who have borrowed on their shares, the advances and interest to be shown separately, and the list to be open for the inspection of shareholders."— Seconded by Mr W. Hen* derson and carried. Mr Borne moved that an extraordinary meeting of shareholders be held on the 9th March to take into consideration the future management of the Company. After some discussion the motion was withdrawn, and, -Mr Henderson moved that if be an instruction to the directors to see whether it was passible to reduce the expenditure and if so to do so.— Seconded by Mr Borne and carried. Mr W Craig said he believed some reductions might be made, in the management expenses, and he would be inclined to begin by cutting down the directors' fees. A vote of thanks to Mr A. B. Campbell for his past services and a similar oompliJ pmt to (be directors wer* pasted, tbe

l j Chairman in acknowledging the latter speak' J ing hopefully of the Company's prospects ! and assuring the shareholders that the dit rectors would do all they possibly could is f their mutual interests. i ______ «_^__