RECORD YEAR IN REVIEW

Southland Times, Issue 23651, 28 October 1938, Page 3

RECORD YEAR IN REVIEW

Permanent Building Society SERVICE OFFERED TO COMMUNITY “The providing of homes for the people on easy terms offers a source of service to the community which has a far-reaching effect, and with efficient directors and staff the Permanent Building Society of Invercargill should continue to help in the progress and development of Invercargill and Southland,” said Mr W. A. Ott, chairman of directors, at the annual meeting of the society last evening. He moved the adoption of the report and balancesheet and congratulated shareholders on the completion of another record year in the history of the society.

“Our figures this year show a marked improvement on former years, and it is pleasing to note that we are of assistance to home-makers in enabling them to secure, on easy terms, substantial and attractive homes, giving full scope to individual taste,” he said. “It is a great advantage to be able to make regular monthly payments, or weekly if preferred, and building societies are an example of what can be done by co-operation between lenders and borrowers through the medium of the building society system. Money is always available to borrowers at moderate rates of interest, and we pride ourselves on the promptitude with which any application for a loan is considered.” The society’s capital A shares remained at last year’s total of £50,000, but in order to provide for the year s increased turnover additional capital had to be obtained, and it was secured

“Our net advances now total £288,012,” said the chairman. “This is the net amount owing by the borrower after repayments have been made. Last year’s total was £242,506. We therefore, show an increase in net advances of £45,506. . , , “It will be seen that ample, funds have been provided to cope with the increased business that has been transacted during the year. The following table shows our effective capital during the past three years:— 1936 1937 1938 Capital A shares 50,000 50,000 50,000 Investment C and D shares 11,709 9,745 11,632

“The repayments during the year amounted to £57,385, almost £5OOO. a month, and our total advances for the same period were £102,277. The total deposits at the end of 1936 were £136,787; 1937, £153,146; and at the end of 1938 £183,792. SAFE INVESTMENT “I would again call attention to the safe investment offered to the investor who places money on deposit with the society. Under the Building Societies Act only two-thirds of the amount lent on mortgage can be raised from deposits, and as advances are granted up to three-fourths of the value and are being continually reduced by monthly payments, the margin of security is being constantly improved. “Adequate provision is made each year for any likely losses, and the directors propose that our security depreciation reserve be brought up to £lOOO. Our general reserve account, with the suggested addition this year of £l5OO, will bring that account up to £19,000, so that our total reserves will be as follows:—

“In the profit and loss account, the balance available is £6407. Last year’s figure was £5836; increased profit available, £571. The directors recommend the payment of a dividend at the rate of 5J per cent, per annum, absorbing £3234 on A, C and D shares. The transfer of £1632 to reserves leaves a carry forward to next year of £1540. Interest on D/1 and D/2 shares has been paid as usual during the year, and ••already debited to profit and loss account.

“Our management expenses this year amounted to £2501; last year’s figure was £2379. The difference of £122 is accounted for principally by increases in salaries. It is interesting to note that the percentage of cost of carrying on the business of the society this year was 13/9 per cent., last year’s figure being 16/- per cent. “The earning per cent, on our effective capital for the year was £6 1/10 against the previous year of £5 16/7. As our business expands and grows so our relative earning per cent, should increase as with practically the same overhead, more business can be transacted. The average net amount of our loans current this year is approximately £432 showing that our advances are well spread. GROWTH OF SOCIETY “The following table indicates the growth of our society since 1915:— Capital Reserves Net Profits

“A very substantial reduction has been made in the premiums payable under the combined life plan, and this protection is being largely availed of by borrowers. This cover provides that on the death of a mortgagor during the currency of a loan, the amount is paid off, thus releasing the property concerned and providing a home for dependents clear of liability The weekly payment required to effect this cover is now very small. Premiums are graded according to the age of the applicant. “The business of the society is confined solely to Southland, and our agents in the various country districts have given efficient service. Judging from the business offering since our balance date, September 30, I see no reason why our business should not expand and grow.” Mr W. B. Dixon seconded the adop-

tion of the report and balance-sheet. The resolution was carried without discussion.

The three retiring directors. Sir Robert Anderson and Messrs E. B. Pilcher and E. E. Broad, were re-elected unopposed. The auditors, Messrs C. E. Borne, and Webb and Stark, were re-elected. When thanking the shareholders for his re-election as a director Mr E. B. Pilcher said that including the StarrBowkett days the meeting was the forty-second annual meeting of the society he had attended. The StarrBowkett Society from which the Permanent Building Society emerged was established in 1896 and ran till 1914. In the life of the building society, from 1914 to 1938 the advances to applicants amounted to £904,085 and repayments totalled £616,074. The Starr-Bowkett Society in its life advanced £200,000, so that the total advances of the two amounted to £1,104,085, all of which had been available because of the thrift of the residents of Invercargill. The repayments amounted to £816,074 and the balance due was £218,011.

The society had followed the system of British societies, added Mr Pilcher, and he was pleased to say that he had received a letter from a director of one of the biggest societies in England expressing appreciation of the good progress being made in the building society movement in New Zealand. Appreciation of the woiT of the staff was expressed by the chairman, and votes of thanks were accorded the directors, the auditors and the chairman.

from the following sources:— £ Investment C and D shares 1,887 Investment D/1 and D/2 shares 8,852 Deposits 30,646 Cash in banks 3,220 Total £44,605

Investment D/1 25,009 and D/2 shares 1,108 16,157 62,817 75,902 86,641 Reserves 15,500 16,500 17,500 Totals £78,317 92,402 104,141

S General reserve 19,000 Security depreciation reserve 1,000 Balance carried forward 1,540 Total £21,540

£ advances £ £ £ 1915 6,141 — 2(5,136 466 1925 25,183 5,500 95,039 3,786 1936 62,817 15,500 211,367 5,547 1938 86,642 17,500 288,012 6,407