THE BANKING INQUIRY.

Star (Christchurch), Issue 5667, 11 September 1896, Page 3

THE BANKING INQUIRY.

TO-DAY'S PROCEEDINGS. FPeb Piibss Association. I WELLINGTON, Sept. 11. The Banking Committee resumed at 11 a.m. Mr Maearthy produced a statement, showing that;" only two accounts of the Colonial Bank in central Otago, amounting to .£76 8s 7d, had not been taken over by the Bank of New Zealand. Seven of the accounts taken over by the bank in that district, amounting to «£14,277, had been subsequently closed. lie was further examined by Mr Montgomery, and stated that it would be to the interest of the bank to separate 'Messrs "Watson and Mackenzie. Those gentle:nen were not wanting in ability and honesty, but witness could not get away from the fact that someone was to blame for the state in which the Colonial bank had been found. Witness s.iid he held, a high opinion of the honesty and integrity of Mr Waison, but he considered that his ideas respecting the Colonial; Bank's.' business .required, watching He knew of fio man he. would like to/seem the position held, by !Mr Watson. The Bank of New Zealand should, in witness's opinion, take over the accounts in the B list, as owing to the limitation of the action of the liquidators of the Colonial Bank respecting them, serious financial injury would result to some of the persons whose accounts were in that list. He thought that the Legislature might interfere in this connection. As matters stood, the liquidators might call on a man in a perfectly solvent position to clear his account at short notice, the result of which might be disastrous to him. The Directors considered that the present system of conducting the bank's business was an absolutely safe one, as advances were now only made for purposes of business and not for investment. He believed it to be undesirable for banks to assume the position of loan companies, though in the past the Bank of New Zealand had filled that position. Whenever a fair price offered, the bank would dispose of its trading concerns. Witness was satisfied with the purchase of the Colonial Bank, and believed that it had increased the Bank of New Zealand's earnings by .£30,000 or more. Witness knew that the present inquiry was injuring the bank, but he thought it possible that when everything was placed, before the public, and confidence was restored, .the inquiry would prove to have been to the benefit of the bank. Examined by Mr Hutchison, witness stated that the guarantee for ,£25,000. given by the Colonial Bank, was not included in the cover given for the B and C lists. He declined to say when the .£20,000 was advanced, as the question had reference to private business. To the Hon J. M'Kenzie: Subsequent events proved the necessity of an umbrella cover for the B and C lists. He had not considered the question of the commercial portion of the Bank of New Zealand being taken over by a company, and the bank itself made into a State institution. The Committee : hen adjourned.