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and to the Committee-—a proposal submitted by the President of the bank ? Were you a party to those proposals?— The first proposal submitted—Yes. The directors were parties. I was a party to those proposals. 43. Were the directors parties to the acceptance of the final proposals?— They were. 44. Was this acceptance reduced to writing and sent to the Government with the formal approval of the directors ? —My recollection is not quite clear, but I believe we sent to the Government a formal acceptance of the final proposals. 45. A part of these proposals was the purchase of the Colonial Bank?— Yes. 46. With a view to increasing the earning-powers of the Bank of New Zealand?— Yes. 47. From whom did the proposals for the purchase of the Colonial Bank come ? Did they come from the Colonial Bank, from the Government, or were they suggested by the Bank of New Zealand itself, and when ?—I believe it is nearest the truth to say that it was the wish of the Bank of New Zealand that, if possible, arrangements should be made by which the Colonial Bank should be purchased ; I believe so. The president of the bank was very anxious that it should be done ; and we recognised that to some extent it was necessary, and, without doubt, advisable. 48. You would not be surprised, after that reply, to know that the Bank of New Zealand, as far back as 1889, had under its consideration the amalgamation with the Colonial Bank ? Have you made any inquiries into that ?—No. Apart from the additional importance of the earningpower to be got by the purchase of the bank, which could be done on reasonable lines, it was of great importance to the Bank of New Zealand that the competition of that particular bank should be removed —a competition which it was sometimes difficult to deal with. 49. Do you know whether the National Bank had ever been approached by the Bank of New Zealand for purchase or amalgamation?—l have no knowledge of it myself. 50. Did the Government, or any member of the Government, approach the bank in respect to the purchase or amalgamation of the Colonial Bank to your knowledge?— There was no suggestion of such a thing as far as I know in connection with the purchase of the bank. 51. A proposal for the purchase was contained in the Act passed in 1895? —Yes. 52., That Act was based upon the report of a Joint Committee of both Houses ?—Yes. 53. Did the Joint Committee of both Houses recommend the purchase of another bank so as to increase the earning-power of the Bank of New Zealand'?—l believe they did. 54. On the strength of the legislation that was passed giving the power to the Bank of New Zealand to purchase another bank—the bank having decided to purchase the Colonial Bank or approach the Colonial Bank with a view to purchase—will you tell us on what basis the proceedings took place to purchase?—We declined from the beginning, and emphatically, to buy the Colonial Bank. We determined that if anything was done we would buy only good business, and, in pursuance of that, we instructed the ablest officers we had to take the books of the Colonial Bank, which after some difficulty and some demur were submitted to us, and go through every account in the bank, and value the accounts and the securities —everything connected with them—and report to us. That was done; and then we as directors took their reports, and from day to day for a considerable time we went over every account ourselves and valued them, making some corrections where we thought the officers had been perhaps a little keen, but on the whole agreeing with them ; and that report we presented to the directors of the Colonial Bank, and, after a considerable amount of negotiation, our finding was embodied in the lists that were presented to Parliament. These lists disclosed the condition of the Colonial Bank at that time. 55. I understand you took the balance-sheet of the Colonial Bank as the basis ?—No ; we did not. We ignored the balance-sheet of the bank. We took the bank's books —we practically took the bank to pieces. We selected the lists as published, and took the business of the bank according to its safety and value. 56. I understand, then, from you that you took, first of all, the assets of the Colonial Bank ? —Yes. 57. That is, the whole of the assets in New Zealand and in London ?—-Yes. 58. You arrived at a conclusion as to the value of those assets ?—We did. 59. What were the total assets taken as good ?—The " A " list amounted to £926,197. 60. And the "B" and "C" lists?— The "B" list amounted to £604,695. The "C" list amounted to £98,382. These three lists make up £1,629,274. 61. Could you give the assets as per lists " B " and " C " which your bank considered good ? —■ I cannot give the names. 62. Ido not want the names. I am asking you. for the amounts ? —We took cover for the "B" list for £272,072. 63. What is the amount in the "B" list which is considered good?— According to this list given to me by you the aggregate in the lists " B " and " C " considered good is £375,772. 64. The Chairman.] Are you giving that answer from a document supplied to you by the Premier ? —Yes. 65. We want the answers, as far as you can give them, from your own knowledge ?—Well, my answer to the question would be that it is impossible to say how much of the " B " list is good, because we found it necessary to take on the amount represented—£6o4,69s—cover to the extent of £272,000. It might nearly the whole of it come out good, so that the cover would not be required; and it might be that most, if not all, the whole cover would be required. 66. Do you consider the cover you have provided amply sufficient for the losses incurred ?— We believe so. 67. You still believe that at the present time ?—Yes. I will give from no paper any answer to a question with which lam not satisfied of my own knowledge. The amount I gave from the list the Premier gave to me is the amount assumed to be good, taking off the whole of the provision. But I could not say that, because we hope a considerable amount of the cover we have taken will be available subsequently to the Colonial Bank. It may not be, but it may be.