SHARES OF BANK OF N.Z.

Southland Times, Issue 25550, 19 December 1944, Page 6

SHARES OF BANK OF N.Z.

Method Of Payment Discussed (P.A.) WELLINGTON, December 18. “Some of the outstanding features of the proposal that the taxpayers should acquire the Bank of New Zealand are the resultant damage to the bank’s business, the loss of that traditional banking protection to the privacy of the customer’s account and the complete absence to date of any sound reasons why the bank can be administered better as a Government department than by private control,” said Mr Andrew Hamilton, chairman of the Wellington Stock Exchange, in his address to the annual meeting today. Mr Hamilton said that apart from those problems, they were faced with the obvious inflation that ■ must follow the payment for such a large purchase, unless some entirely new scheme could be invented for settling with the shareholders.

If it was not intended to manipulate the bank’s business in any but the customary manner, what was the purpose of acquiring it? asked Mr Hamilton. The public had not fully realized how completely they would be making available for departmental inquiry every detail of their financial affairs, even to an intimate knowledge of their private expenditure. VALUATION OF ASSETS

As for payment to the existing shareholders, any proposal to pay a market price was simply a fraud, said Mr Hamilton. A man who built up a business or brought virgin land into cultivation was entitled to the value of his asset. Often he put back into his business or his land a good part of his annual earnings, and so it was with the bank’s shareholders. For years they had denied themselves cash distributions in order to write down their premises and other assets and to create reserves, so they had something in hand to draw upon to help their customers in time of need. Any suggestion of payment other than by a fair valuation of the assets disclosed at once the real reason for the acquisition.