The Stratford Evening Post WITH WHICH IS INCORPORATED THE EGMONT SETTLER. FRIDAY, DECEMBER 11, 1914. BANK OF NEW ZEALAND.

Stratford Evening Post, Volume XXV, Issue 295, 11 December 1914, Page 4

The Stratford Evening Post WITH WHICH IS INCORPORATED THE EGMONT SETTLER. FRIDAY, DECEMBER 11, 1914. BANK OF NEW ZEALAND.

The half-yearly General Meeting oi shareholders of the Bank oi New Zealand was held this morning, Mr Harold Beauchamp (Chairman of Directors) presiding. The only actual business before the Board, was the election of a representative by shareholders on the Board, and the declaration of an interim dividend. In the course oi' his speech the Chairman referred to the financial crisis caused by the deplorable war,' and stated that immediately Upon its becoming known that our Mother Country was involved in the struggle the New Zealand Government, with commendable promptitude, took the special steps which became necessary to prevent a financial crisis in the Dominion. A Bill enabling bank notes to be proclaimed legal tender was passed through Parliament and a proclamation issued making bank notes legal tender on and after the sixtli of August last. This proclamation has been renewed, and it will no doubt be found desirable to keep it in force until the war is over. Mr Beauchamp pointed out the object is not so much to provide currency facilities as to enable the Banks to preserve the gold reserves of the Do minion. It was not found necessary ,to proclaim a moratorium such as was required in the United Kingdom, all that was needed being the provision for the protection of mortgagors, and all purchasers under agreements for sale and purchase, with instalments of purchase money falling due. This provision was made by the "Mortgages Extension Act," which prevents realisation by mortgagors or vendors under powers of sale contained in securities except with the sanction of the Supreme Court. In London the position was, of course, different: far more serious in fact than we at this distance and in our circumstances can possibly conceive. For a few days or so there was confusion. With the bank rate at ten per cent, the money market was dead, the banks were temporarily closed, the statutory batik holiday on the 3rd August being extended over tho fourth, fifth and sixth idem ; trade, shipping and commerce all at a standstill. The British Govern inenf, bankers and financiers, conferred as to the best means of meeting a crisis quite unprecedented in the history of the world. A moratorium was proclaimed, and to assist in conserving the gold reserves of the country, Government Treasury notes for one pound and ten shillings each were authorised to lie made legal tender. Postal notes were also made legal tender. The banks were supplied with notes by the British Treasury, tinbanks paving to the Treasury for the accommodation a tax equal to the

Bank of England rate during the lime that the notes are used. The business of the banks reopened on the seventh August, but they were unable to. immediately resume discounting or the buying of Bills of Exchange. Then a measure of relief came, and it was announced on the thirteenth August that' the Bank of England would give assistance, under the guarantee of the British Government, by discounting approved Bills of Exchange accepted prior to the -Ith August, 1911, without recourse to the holder. A great rush set in, but gradually the mass of business was disposed of. Business began to assume a more normal aspect and natioiial credit was, in a large measure, restored. Referring to the Bank of New Zealand, Mr Beauchamp went on to say that viewing its general position it may be said to have come through the crucial stage of the crisis with the minimum of inconvenience and loss. The foresight of the London Board had anticipated the" financial difficulties that would arise upon the declaration of war, and consequently when the crisis was precipitated, the Bank was in the comfortable position of holding a very large balance of cash at the Baidc of England. The Bank therefore at any time had not the slightest trouble in meeting its commitments and providing for all requirements. Proceeding, Mr Beauchamp said the fact that the Bank should be able to weather so severe a storm with practically no damage was conclusive testimony of the soundness of the business it transacted and the wisdom of its policy in this respect has, in the recent upheaval, been made more abundantly evident than ever before. Too much stress, he points out, cannot be placed upon the magnificent service rendered in the relief of the position .by the British Government* which faced the crisis in a courageous and statesmanlike manner, and with prompt and firm determination threw the whole stress of the country's resources and credit to the support of its finance. Touching upon the war itself, Mr Beauchamp says that it is impossible to arrive at any trustworthy conclusion with regard to the duration of the present momentous struggle, but he cannot, however, help thinking that the huge economic and financial difficulties which Germany must shortly have to face, will prove a very important factor in de termining the duration of. the struggle. After dealings with many other important aspects Mr Beauchamp expressed his personal opinion, that the end will come sooner than has been expected, and possibly with a dramatic suddenness that will astonish us. The industries of the Dominion are • not likely to be adversely affected by the war, but rather, he says, the reverse. Prices for New Zealand staple products —wool, meat, butter and cheese—are satisfactory, and a large output is assured. If adequate facilities be provided for the conveyance of the Dominion's products to the remunerative markets that are awaiting them, a prosperous season will be experienced. Shortage of carriers was at one time apprehended, but the Government has now taken the matter in hand, and it is understood to be making arrangements which will give ample provision for the export of all produce available. Altogether Mr Beauchamp's able review of the financial position is a decidedly cheering one, and coming from such an .authority will do much to give confidence to the more timorous in our midst.