BANK OF NEW ZEALAND

Taranaki Daily News, 16 October 1931, Page 9

BANK OF NEW ZEALAND

SEVENTIETH . ANNIVERSARY ’

foundation in auckla . HISTORIC EVENTS RECALLED. Seventy years ago to-day the Bajik of New Zealand, founded by a group of Auckland business men, first opened its doors for business. The original bank premises were on the eastern side of Queen Street, opposite the present location of His Majesty’s Theatre. The buildiu-r was one of the first brick structures in Auckland, and had previously been the warehouse of Alessrs. T- and S. Forsaith. Ou tiie site now occupied by the bank an the western side of Queen Street the Trafalgar Hotel then stood. “It is an institution that has been long and urgently required, and which, takin"' the New Zealand Insurance Company °as an example, can scarcely fail of achieving a large measure of success,” stated a newspaper account of the opening of the bank on October 10, 1801. The bank, says the New Zealand Herald, had been incorporated by Act of the General Assembly in the previous July, and had at its inception a capital of £500,000. ' '- Although the bank was not the first to operate in New Zealand, it was the first of New Zealand origin. The growth of the bank in 70 years is illustrated by the fact that to-day its paid up capital is £6,858,113, its reserve' fund totals £3,575,000, and undivided profits £626? 001, a total of £11,059,114. It has over 150 branches and agencies throughout the Dominion, a London office with a London board, and branches at Sydney, Melbourne,. Suva, Levuka and Apia. • The first directors were Air. Janies Williamson, president, Dr. (later Sir) John Logan Campbell, the Hon. Thomas Henderson, Alessrs. James O’Neill, George B. Owen, Thomas Russell and Charles J. Taylor. The general manager and inspector was . Air.- Alexander Kennedy, and the auditors were Alessrs. Samuel Browning' and William C. Daldy. An advertisement announcing the opening of the bank stated:- —“lhe Bank of New Zealand offers great facilities to the mercantile and general community for exchange operations by its arrangements with tiie Oriental Bank Corporation for transactions with their widespread and -numerous branches and agencies in the United Kiiigdoni, Victoria, New South Wales, India aiid China.” In the year when the bank was founded the footpaths of Queen Street were still formed of wooden planking, just as from the beginning of the time when there wore footpaths of any kind. All the buildings of Lower Queen Street, as far up as Vulcan Lane, were on piles—some because they abutted upon intake lagoons, and those . above Shortland Street because the surface of the ground thereabouts was mostly mud. Auckland was then the seat of Government, the removal of the capital to Wellington taking place in 1865. THE FIRST BALANCE-SHEET. The report presented to the first annual ifieeting on April 30, 1862, stated that “the directors have established 11 branches and agencies throughout the colony, exclusive of the agencies on the goldfields of Otago. The Taranaki branch was opened on November 15, the Dunedin branch on December 2, the Wellington and Nelson offices on January 15, and all the other branches and agencies have been since established. It will thus be seen that none of the had.been a full half-year in operation, whilemany of them were only just commencing business- Yet, after deducting the charges of the general nianagement, and expenses at the head office and branches and agencies, the directors have the pleasure of announcing a net profit on Alareh 31 of £6097 55.” A dividend at the rate of 0 per cent, per annum, absorbing £2370 12s, was declared, £3OOO was placed to the credit of the reserve fund, and the balance of £726 13s wiis carried to the profit and loss new account. The bank made a net profit of £13,970 in the following halfyear, added £6OOO to the reserve fund aiwft declared a dividend at the rate of 10 per cent. THE CRISIS OF 1894. Dividends at a satisfactory rate continued to be paid for several years, but the tide of prosperity ebbed steadily until 1887, when the bank entered the most difficult and dangerous period of its existence. In tiie times that followed the colony passed through- the most critical financial situation in its history until then, a period of depression during which many commercial firms and landowners faced great difficulties. The series of misfortunes which began in 1887 culminated in the loss of the whole of the capital and reserves and one-third of the reserve liability. In 1890 the administration was transferred from New Zealand to a London board and the New Zealand Estates Company was founded with the object of relieving the bank of heavy responsibilities which it had incurred when numerous estates and businesses fell into its hands. The Estates Company encountered difficulties. In 1894, when the outlook was blackest, the situation was saved by Government intervention and the issue of £2,000,000 worth of stock guaranteed by the country. At the same time the control of the bank was trausfeiied from London to a board in Wellington and the Government later became a shareholder. Reconstituted by legislative authority and aided by the acquisition of the business of the Colonial Bank, the Bank of New Zealand began by degrees to retrieve its fortunes. For a few years no dividend was possible, but, favoured by a succession of years of general prosperity, it was found possible to pay a dividend 'of 5 per cent- for the year ended March 31, 1902. The rate was raised in 1907 to 10 per cent, on ordinary shares and 7| per cent, on preference shares. The jubilee year, 1911, was marked by the payment of dividends or 15 and 10 per cent, respectively. BANK’S OLDEST CUSTOMER. The dividend on ordinary shares today is 14 1-3 per cent. On .preference shares the rates are:—A (held by Government), 10 per cent.; B (held by Government), 13 2-11 per cent.; C (held by Government), 6 per cent.; D, 7$ per cent. Whereas the first balance-sheet shows assets amounting to £555,979, the balance-sheet 1 submitted to the last 'annual meeting in J'J'm showed assets amounting to £52,959,262. The bank’s oldest continuous customer is believed to be Mr- P. Le Quesne, of Hamilton. Mr. Le Quesne, who celebrated his 95th birthday on October 7, opened his account with the bank i;i 1866.