BANK OF NEW ZEALAND.

Wairarapa Daily Times, 3 December 1926, Page 6

BANK OF NEW ZEALAND.

HALF-YEARLY MEETING. The half-yearly general meeting of the Bank of New Zealand shareholders was held at Wellington to-day. ■ o chairman, in his address, said', lU alia: —

To-dav brings to an end the halfvearly meetings that have been held annually in December since the head office of the Bank was' transferred from London to Wellington. Beyond being the occasion of the election of directors and the declaration of a dividend, it is difficult to find any other reason for their institution.

There are, as usual, no accounts o lav before you, but I have pleasure in stating that the profits earned for the half-rear ended September last warrant the navinent of dividends similar to those paid for the corresponding period last year. Dividends will be paid m Wellington to-morrow, and at the various branches on receipt of advices.

The proposal discussed at our annual meeting of setting up a special department for the making of long-dated loans on an amortization basis, was' considered by Parliament last session, aiid, as you are aware,*un Act known as the “Bank of New Zealand Act, 11*26, was passed giving the Bank authority to enter into this clas's of business. As a resume of this Act has been circulated amongst shareholders, I need not go over the various clauses.

Power was taken m the Act that, with the permission of tile Minister of Finance, further is'sues of shares . and debentures beyond those immediately authorised could be made on the same lines, but no application can be made to the Minister unless the consent of the ordinarv shareholders of the Bank is first obtained. In the future, therefore, the matter of extending the operations of this new department ivill be made on the initiation of ordinary shareholders.

As the matter of making long-dated loans on an amortization basis by a ■joint stock bank is, to an extent, tx perimental, the ordinary shareholders, should they deem it advisable, have the right to wind up the long-term mortgage department, cancel the shares? and return all capital at par.

It is expected that the expense involved in connection with the activities of this new department will not be great, as all matters connected with it will be carried on by the staff already in existence at the various branches, and although no direct profit can be expected, it is* anticipated that a certain amount of indirect advantage may accrue to the Bank.

The Department will be watertight, trading on its own special resources, and no funds of the Bank will be used in its conduct otherwise than that advances up to £500,000 from the ordinary funds may be made pending the raising of capital or debentures. With this exception, it is intended that the ordinary business' of the Bank and that of the long-dated loans shall be kept entirely separate.

The fact that practically the- whole of the Australian and New Zealand clips for 1925 had been sold and disposed or",' together with the half-million bales carried ovqr from the previous season, accounts, no doubt, for the present steadiness of the wool market, and augurs favourably for the coming season.

In view of the fact that there are practically no stocks carried over or held up eitheT in Australia or New Zealand, there is’every reason to believe that, the coal strike having been settled in England, the pro nt prices of all classes of wool should be maintained for some time to come.

Prices for meat, except for slight variations, have remained, steady throughout the period under review. Without a doubt, the industrial unrest in the United Kingdom accounts for the decided fall in the value of dairy products'. Under the circumstances. the supply of butter and cheese has greatly exceeded the demand. As.the chief problems of the -Meat Control Board and the Dairy Control Board are identical, the merging of the two int one would result, not only in a great reduction in expenditure, but would make for greater efficiency, especially is the number of the members pn the combined Board were'reduced considerably—say, to a total of five. —two representatives from each industry, with a chairman appointed by the Government.

I am certain that one small wcll-scl-ected Board could manage the business now carried on by the two Boards much more advantageously from every

po.int of view. The termination of the unfortunate coal strike —estimated, directly and indirectly, to have resulted in a loss of at least £400,000,000 to Great Britain—will, in my opinion, be followed by great industrial activity there. It should also have an immediate effect on the values of the- primary products of Mew Zealand.

-As compared with the previous year, apart from Government deposits, the total average deposits of all the Banki trading in New Zealand for the three months ended -September last, have decreased -by £1,770,571, while advances have increased by £0,127,375, making a total reduction in the resources of the Banks of £4,897,94(3.

This position is brought about entirely by excess of imports over exports. May I remind you that practically the whole of our exportable surplus is 7-hipped to the United Kingdom, and it is within the range- of possibility that in the years to come the demand for our products there- may gradually decrease. .

World conditions are changing. TliO tendency amongst the nations —not excluding the British overseas dependencies—is to heighten their customs barriers iu order to encourage their manufacturing industries, and, as a consequence, British trade must suffer.