The Taranaki Herald. DAILY EVENING SATURDAY, JUNE 14, 1919. THE BANK OF NEW ZEALAND.

Taranaki Herald, Volume LXVII, Issue 16462, 14 June 1919, Page 2

The Taranaki Herald. DAILY EVENING SATURDAY, JUNE 14, 1919. THE BANK OF NEW ZEALAND.

The retiring general manager of the Bank of New Zealand will have the proud satisfaction of handing over to his successor the control of the bank’s affairs in a state of quite remarkable strength and prosperity. For fifty out of the fifty-eight years that the bank has been established Mr. Callender has been associated with it. He has seen all its ups and downs, but during the period that he has held the most responsible offices the bank has steadily, even rapidly, acquired strength until now it can claim to be one. of the soundest finanial institutions in the Dominion. The balance-sheet presented at the annual meeting on Friday is perhaps the best yet produced, showing expansion of business, increased profits, and at the same time a cautious writing down of assets and strengthening of the reserve fund. With the appropriation from last year’s profits ■ this fund has now reached a total of £2,350,000, which is a little in excess of the bank’s paid-up capital. When it is remembered that twenty-five years ago the bank was on the verge of bankruptcy, and only saved by Government intervention, this is a remarkable achievement. The business of the hank has expanded in an equally striking manner. At the same time the bank’ has played an important part in the development of the Dominion’s trade, industries ai}d resources. It has given liberal assistance to legitimate enterprise while avoiding encouragement. of merely speculative ventures. Good profits, it is true, have been made., but these cannot be regarded as excessive, especially when it is remembered that during recent years heavy taxation has had to be borne. Last year alone rates and taxes absorbed £386,272 of the gross profits. Then it must not be forgotten that banking business is not always profitable. Shareholders in this bank have in the past lost heavily and it is only fair to set off the lean periods against thfe fat. The management has adopted a very proper policy during the war of strengthening its resources, for it is impossible even now to foresee with any certainty what post-war conditions of trade and finance will be. The chairman of directors, Mr. H.. Beauchamp, in his address adopted a cheerful tone and we believe this is fully justified. New Zealand of all countries should be able to weather any storm that may come as a result of the war. It has incurred a heavy debt, it is true, but it profited substantially by the high prices ruling for its principal products, and there is every prospect of a good demand at remunerative prices for everything it can produce for years to

come, -It may be thought that the bank is inclined to be over cEuitious in providing capital for industries, but Mr. Beauchamp •was undoubtedly on sound ground in his remarks in this connection and he quoted a high authority, the deputy-chairman of Barclay’s Bank, Ltd., in support of his view. It is not legitimate, banking business to undertake, the risks often involved in the establishment of industries, though it is -a bank’s business to assist in financing them with adequate security. That is to say, a bank may quite properly provide a substantial proportion of the capital required, say for a freezing works, on the security of unpaid (not unissued) share capital, assuming, of coarse, that the shareholders are good for their calls. The Bank of New Zealand’s policy has been and is to give such assistance, and as long as it continues this policy and avoids speculation which in years gone by nearly brought about its ruin it will be a power for good in the Dominion. If there is a feature of the business which calls for. criticism it is in connection with the staff, the rank and file of' the staff. These have found the increase in the cost of living during recent vears very trying and the bonuses given have not sufficed to meet it. The master has received a good deal of attention from the directors and management/ and of course the future has to be considered as well as the present, but the officers of the bank, especially in the middle and lower grades, are perhaps entitled to share a little more freely in the present prosperity.