BANK OF NEW ZEALAND.

Wairarapa Daily Times, 11 December 1925, Page 6

BANK OF NEW ZEALAND.

HALF-YEARLY MEETING. At the half-yearly general meeting, held to-day at* the head office of the Bank, Wellington, Sir George Elliot (chairman of directors), presiding, said:— Although there are no accounts to lay before you, it is pleasant to be able to state that the operations of the Bank for the half-year, which ended on the HOth of September last, are of a satisfactory character. INTERIM DIVIDEND. •The profits earned during that period warrant the payment of an interim dividend on the ordinary ©hares at the same rate as that of a year ago, viz.. Is 4d per share on the capital that uas paid up at Ist April last, and of t-d pci .share on th'e small number of the new shares —1233 —which, not having been taken up at that date, were allotted on 7th September. This dividend ’"ill b( payable at Wellington to-morrow, and at’the branches on receipt of advice. AGTMCULTURA L BANKS. ■Since our annual meeting, a commission lias been set up to enquire into the question of rural credit associations, or agricultural banks, and to report thcicon to the Government. The Commission has left New Zealand with fairly free permission to visit any country where banking systems, having for their main object the financing of prim ary producers, are being carried oin At our meetings in 1922 and 192.;., 1 dealt very fully with the subject of agricultural banks, and expressed the opinion that the financial requirements of our primary producers- arc fully met b> banks and other existing organisations, and by the Government Advances to Settlers Department. What I said then, in my opinion, holds good now. I should like, however, to emphasise one idea embodied in the speeches referred to. It is that the institution of an agricultural bank for the purpose of making long or short-dated loans, or loans on an amortisation basis, would not be opposed by any banking corporation in New Zealand so long as an agricultural bank was placed on exactly the same basis in connection with the holding of liquid reserves against deposits, payment of rates, taxes, etc., as are the ordinary existing commercial banks. TIME-PAYMENT .SYSTEM, There is a matter which I think .should be brought before you, and that is the great extent to which the hire-, purchase or time-payment system of dealing in articles, from a gramophone to a motor car, from a perambulator to ' :i building section, is .becoming a feature of this country 's trade. The good old-fashioned notion of buying an article only when one has money to pay for it seems to have gone by the board. Almost any article can be, and is now being, purchased on the .payment of a few shillings a week and upwards. That the system is pernicious needs no argument; it seriously affects legitimate business; it is costly in the extreme to the purchaser, and it tends to breed a habit of reckless extravagance. There are, of course, exceptional occasions when the system may be of advantage, but, gegnrallv speaking, it is a dangerous practice for buyer and seller alike. Any serious financial setback would have a disastrous effect on those whose trade is largely made up of the selling of goods on the time-payment system. ' CASH ON DELIVERY SYSTEM. The cash on. delivery system, commonly known as the C.O.D. system, is extending to New Zealand. This is a system bv which a merchant in England can send goods through the post office to a customer in New Zealand; the Post Offico officials here collecting from the customer the cost of the goods, .plus Customs duty, and remitting to the merchant in England the price of the goods, and to the Customs Department here the duty collected.

This system lias been in vogue on the Continent of Europe for many years, apparently with satisfactory results. To show how it has grown, it is only necessary to quote two instances. In Germany in 1913, the last year during which normal conditions prevailed, 74 millions C.O.D. parcels were handled by the Post Office, of an aggregate value of £78,000,000; while Denmark, in 1914, handled 11 million parcels. •It is claimed by wholesale merchants and retailers in New Zealand that, if this system assumes proportionately anything like thees dimensions, it will have a most serious effect on the ■wholesale and retail . business of the Dominion. The very fact that the Associated Chambers of Commerce in Great Britain condemn the system shows that traders there are keenly feeling this Gov-ernment-assisted competition, and, if traders in Britain are feeling the competition, wheTe conditions between Britain and the Continent are more alike, there is greater reason for New Zealand traders to take strong objections when conditions are so dissimilar and the chance of a reciprocal trade being developed so microscopic. LOAN 'FLOTATIONS. Notwithstanding the lifting of the embargo, which was recently imposed on the floating of foreign and colonial loans in London, it is difficult to get money there at the present moment, except at a high rate of interest. In view of the depression of trade which prevails in Great Britain, the high taxation, and the enormous public debt to America, it is doubtful if Colonial Governments can look to London with, any, confidence to supiply their monetary wants for some time to come. It is doubtful, too, if America will supply our needs in the meantime, for it is quite apparent that the American public was not enthusiastically interested in the last Australian loan floated there. Underwriters and speculators must have been left with a large proportion

cf it, for even quite recently c\ erj jending institution in this country was being offered large quantities of tins Australian loan by American brokers. The difficulty in the immediate tuturc- cf raising loans may be a blessing hi ffis-uise. it' thereby a brake is put on mtblie borrowing. Much of the recent.' expenditure of local bodies _ ]ias been unwarranted. Hydro-electric reticulation schemes, especially those serving scattered populations, must tor many years be a burden on Duo rate■•'Sicro ] ias also been unjustifiable cxl>oadHure by Harbour Boards desiring to encourage overseas .shipping, upon harbours where the total export trade of the district served would not, if the produce could be held up for a year, completely fill one average-sized ship. As far* as the flotation of loans ts concerned, New Zealand will in the future, I think, have to depend upon her own resources to a greater extent than has been .the case in the past; and, unless loan isues are carefully and judiciously spread, high rates of interest will have to be paid.

Turnin’g now to primary products, it is satisfactory to note that the prices obtained during the past six months have been fairly good: DAIRY PRODUCE. Jh most parts of the country a very wet winter and late spring have been experienced. This has had the effect of greatly reducing the output of the dairy factories. Cows have been in poor condition, and the total yield of milk lias been much reduced. The grading statistics for the three months that ended on 31st October, •show that the quantity of butter graded was 3OSS tons less than in the corresponding period in 1924, while cheese graded showed, an increase of 533 tons, the total -showing a decrease, in terms of butter-fat, of 13.4 per cent. •With the advent of warmer weather, pastures have greatly improved, and dairy factories are now receiving satisfactory quantities of milk aiul cream. It is doubtful, however, if the decrease in production experienced at the beginning of the season can now be made up. ... Although there has been this diminution in quantity, price!? have been satisfactory. At the opening of the season some factories reported sales of their output of cheese up to the end of December at 91 d to 93d per lb, and it is estimated .that 80 per cent of the production to the end of the year has been disposed of at prices which mean a payment of about Is 10d per pound for butter-fat. Sales of October-Novcmber makes of butter have also been reported up to Is 7id per lb. Good monetary returns for the first half of the season are therefore assured. WOOL. The downward course of prices appears to have been arrested, and there is a. steadv, if somewhat limited, demand. At the recent London sales, and those hold in Australian centres, Continental buyers have been the main support of the market. The Home trade, while slowly recovering from the disastrous experience of the last few months, is only operating under a general policy of hand-to-mouth trading. Prospects for the new clip appear to be fairly good, and prices, although well below those recorded at the opening last year, should be at a remunerative level. MEAT. On account, of strong competition amongst exporters, farmers received higher prices for fat sheep and lambs during the past season than wore wair.mtcd bv prices ruling in the world's markets, and exporters had to bear heavy lo c ses on the realisation of their pinchases. Owing to the unfavourable weather, the present season is likely to be a backward one. The future of the market is somewhat uncertain, but it is reasonable to suppose that prices this season will not be on so high a level as those ruling last year. There is no occasion to take a gloomy view of the future, but there can be no doubt whatever that the present should be a rallying time for the industrial forces of the Empire. In New Zcaland, for example, it. should never be forgotten that Britain is our beet, customer, and everything possible should be done by the Government and the individual to encourage and foster British industry, for on the well-being of the Mother* Country, New Zealand absolutely depends for a continuance, of her prosperity.