1.—6

44

325. At what stage did this matter crop up in reference to this possible loss of £30,000 or £35,000 ? At what stage of the negotiations ; was it near the end ?—I think the first time it came up for discussion by the directors was at the end, when the final conditions were settled. 326. How did you first hear of the £25,000 being in jeopardy ; who spoke to you about it ? —The fact became plain to us in the course of the negotiations. 327. Who told you ?—The fact became plain, as I indicated before, during the course of the negotiations. 328. Was it from Mr. McLean or Mr. Larnach that you first heard of it?— No. The advances had become doubtful; but the position became practically defined as indicated by the statement I made before, that, in the event of the agreement falling through, the security upon which the advances rested would disappear. 329. Supposing the agreement had fallen through, how would that have affected the Bank of New Zealand ?—I do not think I can say more without the answer involving a disclosure of the confidential relations of individual accounts, both of persons and companies, trading with the bank. 330. Did these advances of £20,000 and £5,000 originate in the Bank of New Zealand ? —They were advances made by the bank. 331. And during the arrangements for amalgamation or purchase you stipulated for these advances being guaranteed ?—We took advantage of what we believed was a very good opportunity, to obtain, as part of the bargain, a guarantee that would make these advances safe. 332. How was it that the Colonial Bank came to guarantee advances made by the Bank of New Zealand ? —I do not think I can explain that. 333. Can you do it, or do you refuse to do it ? —I cannot explain that. 334. From want of knowledge ? —Not from want of knowledge. 335. From indisposition ? What had the Colonial Bank to do with these two advances at all ? —That is another form of the last question. i: 336. Did they come to you from the Colonial Bank originally ?—No. 337.. Yo.u took the guarantee at the time of the agreement ? It was an insecure transaction which you took the opportunity of making stronger by your agreement?— Yes. 338. Do you repeat your former answer, that the President of the bank was responsible for the advances in the first instance ?—I adhere to my former answer, but it does not correspond with that. 339. What was your former answer?— That he was practically responsible. 340. Did the directors know of this at the time the advances were made ?—I do not think I can say anything further about that. 341. Were the directors, you being one, responsible for these two advances at the time they were made ?—I am not able to answer the question. 342. I wish you to answer clearly whether you decline or not —I am not able to give the answer. It would involve disclosures respecting private accounts. 343. It is that you refuse on that account ? You are able to answer, but you decline ? —That is so. 344. I desire that question to be taken down. Discussion ensued. h The Chairman : I think the question is one that can be put. Mr. Hutchison : Will you answer the question ? 345. The Chairman.] Were the directors, you being one, responsible for these two advances— namely, £20,000 and £5,000 —at the time they were made ?—I am not able to reply to that question without disclosing what would traverse the Chairman's decision of Saturday. 346. It is simply Yes or No, whether the directors were responsible or not? —I think, Sir, the question is not capable of being answered with truth, yes or no. The true answer would involve disclosures which would traverse your ruling on Saturday. 347. I ruled on Saturday that the question could not be put which was before us then, because it referred to writings-off, and we had no proof that there had been a writing-off. Discussion ensued. Witness : I can only say that, if that answer is not sufficient, I am not able to give an answer. 348. The Chairman.] Do you mean, you must decline to answer the question?—l must decline to answer the question. 349. Do you give any reasons?—l think that a further answer would disclose the confidential relations of the bank with its customers.

Tuesday, 11th August, 1896. Examination of William Booth, Director of the Bank of New Zealand, continued. 1. Mr. Hutchison.] There were some matters you were going to inquire into, Mr. Booth ?— The information is being prepared. It is not yet ready. Probably it will be by to-morrow. 2. Do you know the date of your power of attorney?— You will find it most likely in the papers that will be supplied to-morrow. 3. Can you tell us the date of the purchase of the Consols ?—No ; not from memory. i . 4. In fact, you are holding over all these matters which were in. suspense yesterday until to-morrow ?—I think the information will be ready to-morrow. They are preparing, it at the bank. 5. That includes also the doubt you had as to whether the President of the bank made certain statements at the meeting of the 7th February?— Yes.