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156. Where, then, do you expect to get the money to write down this fictitious amount for landed property and bank premises ? —We shall have to leave it to the future. 157. Meanwhile you put it as an asset in your balance-sheet, and you also treat the whole of the £75,000 for good-will as an asset ?—lt is a very good asset. 158. Have you made any profit out of the Colonial Bank business against which you can place the £75,000 ?—We have made some. 159. How much ?—I am not able to say this year. Surely it is but ten minutes, so to speak, since we took the business over. How is it possible to say, with the thousands of complicated accounts we have, that after a few months' working of a great business like that, to what extent it has been profitable. We are satisfied that the business is good to us to the extent of probably £20,000 or £22,000 a year. Surely the sum paid for such a business is not an outside price. 160. Is not that an assumption ? —lt is not an assumption. 161. Can you point to any proof?—We have a reliable valuation as to what the Colonial Bank is worth to us. 162. Where is that valuation ? —I am not aware that we have the particulars, but we had a very careful valuation made by the acting general manager, Mr. Andrews; and, after making a most generous discount, we had, at any rate, from £20,000 to £22,000 left, upon which, I think, it is perfectly safe to rely. 163. You think so; but could you give us any basis for that opinion ?—No; the negotiations belong to us, and we are responsible. 164. But you are responsible to the country, represented by this Committee?—We are; and we are discharging the duty faithfully, as well as to the bank. 165. I desire to have the foundation for the opinion you have so frequently expressed before the Committee, that you made a good bargain in buying the Colonial Bank ?—Yes. 166. I ask for your foundation for that opinion, so that we can test its value. What is the basis of your opinion, so that we may judge as to the correctness of that opinion ?—I do not at present see any objection to the detail being given to the Committee, which would show the course we took in determining the value of the business we were to acquire ; but I would like to have time, if I am permitted, to consider the matter and give answer to-morrow. 167. Taking the last balance-sheet of the Colonial Bank, the items of which you have given us to-day, is not the result of your analysis that the whole capital and reserve fund of the Colonial Bank was literally doubtful—from your own showing ?—No; we cut out from the Colonial Bank everything upon which their losses had been made, and took from it only their good business. 168. That would mean that the whole of the reserve fund and capital of the Colonial Bank had disappeared ?—I think you can form your own conclusion just as well as I can from the figures. 169. You are an expert. Can you not tell us what would be the result ?—I do not feel called upon to express an opinion about the Colonial Bank balance-sheet. 170. Very well. We will take the items of the Colonial Bank balance-sheet. First, as to the debit side : There was the capital, £400,000, and the reserve fund, £65,000. Then we find the items : Notes in circulation, bills payable and other liabilities, deposits, and balances due to other banks, aggregating £2,516,255, and, with the capital and reserve, totalling £2,981,255. The other item is, Balance profit and loss—this is a credit, but appears on the debtor side to balance the account—and the total thus being £3,001,236. Now for the other side: Coin, bullion, and cash balances at bankers, notes and balances due by other banks, Government securities, landed property and bank premises ; which last item appears at £125,399. Should it not rather be £30,000 or £35,000 less to be safe?—l do not think lam called upon to express an opinion. 171. On the valuation made by the Bank of New Zealand, should it not be less than £125,399 ? —If I was buying them I should not give so much by £30,000 or £35,000, I suppose, for them. 172. Would that not leave the value at £90,000 or £95,000—say, £95,000 ?—That is my estimate. 173. Then there is the item of bank furniture, which appears at £9,717. Should not that be put at £6,250 —the price you paid for it ?—I do not think so. 174. Was that the amount you took it over at?— Yes; we bought it, but did not want it; but the Colonial Bank possessed it, and we had full use for it. 175. We will suppose that the Colonial Bank was in liquidation. You estimated the value of the furniture for your purpose at £6,250 ? —Yes, that is what we got it for. 176. Very well, then, the last item is bills discounted and all other debts due to the bank, £1,731,549. Now, you treated the "D " list as something you would not purchase. You would not have anything to do with that?— No. 177. Then, the whole of the " D" list, amounting to £102,274 and £327,305, for which you took cover, as against the " B " and " C " lists, indicated the accounts that you would not take over out of that sum of £1,731,549 ?—Yes, that is so. 178. Then, assuming the figures I have given to be correct, including £95,000 for the landed property and bank premises, and £6,250 for stationery, and deducting the " D " list and the cover for the " B " and " C " lists, instead of a credit balance to profit and loss of £19,980, as shown by the Colonial Bank balance-sheet, there should appear on the other side a debit balance against profit and loss of close on £450,000 ?—Yes, supposing they do not get out of the " B " list any part of the cover. 179. They may recover something; but is the position at present as I have indicated ?—I do not think that is the position, consistent with the truth of the case. In the "D " list a considerable number of items have become much better, and the list promises to be much better than appeared to us likely at the time of purchase of the Colonial Bank ; and there may be a substantial advantage from working the "B " list. During the next two years the result may be that a large amount of money will come back to the Colonial Bank.